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Calmirb. Man and Nature. Sixth edition re- 
vised. Crown 8vo, $i .50. 

Stukmsrb. Man and Man. Third edition re- 
vised. Crown 8vo, $1.50. 



On thb Civic Relations. Being a third edi- 
tion of " Talks on Civics " rewritten from the 
catechetical into the expository form, and re- 
vised and enlarged. 

HOUGHTON, MIFFLIN & CO. 
Boston and New York 



ON THE 
CIVIC RELATIONS 



BY 

HENRY HOLT, A.B., LL.B., LL.D. 

Member of the New York A cademy 0/ Political Science, the A merican 
Political Science Association, and the A merican Economic 
A ssociatioH ; A uthor 0/ " Sturmsee : Man 
and Many** etc. 




BOSTON AND NEW YORK 
HOUGHTON, MIFFLIN & COMPANY 
Gfre fflrotttffce preft> Cambridge 
1907 



COPYRIGHT 1907 BY HOUGHTON MIFFLIN * CO. 

First Edition ( Third of " Talks on Civics ") printed May tqpj 



GIFT OP 
SCAN A. 8. WHITNEY 

{■30 



PREFACE TO THE THIRD EDITION. 

While this book is, in one sense, a third edition of 
my "Talks on Civics it is really, in many important 
differences and additions, almost a new work. Among 
the peculiarities, not to speak of the defects, under 
which the earlier editions labored, was the catechetical 
form, of which I expressed my distrust in the first 
preface. That form was adopted largely because the 
work was aimed at very young pupils. Before it was 
finished, I became convinced, as stated in a note to 
the earlier editions, that the aim was not one suited 
either to the greatest possible usefulness of the book, 
or to the capacity of the author. Both in regard to the 
aim, and to the catechetical form, this conviction was 
supported by many readers, and in consequence I 
have rewritten the book. The rewriting of course has 
led to many differences of detail ; and the growth of my 
own convictions, as well as the astonishing develop- 
ment during the past few years in many ctf the matters 
treated, and the increase of topics demanding treat- 
L ment, have combined to make the work, as already 
< stated, in many particulars a new one. So rapid has 
been the development in some particulars, as almost 
i to render them unfit for treatment in a book, and to 
make it impossible to keep pace with them except in 
the daily and periodical press. Each proof and each 
revise has clamored for insertions, and I go to press 
neglecting important matter that has appeared since 
my copy, and also my revises, went to the printer. 
I must even beg the reader's charity for some incon- 

iii 



iv 



Preface to the Third Edition. 



sistencies that must have escaped me between matter 
coming after the original draft, and matter contained 
in it. 

Notwithstanding the space saved by doing away with 
question and answer, this edition is more than a hundred 
and fifty pages longer than the preceding one. The 
added matter contains its share of the sort of repeti- 
tions that were confessed, and I hope justified, in the 
preface to the first edition. Most of it relates to "the 
labor question", socialism and municipal trading, and 
will be found principally in Chapters XIX-XXII, and 
XXVIII-XXX. 

I confess, not quite without shame, to having, in the 
earlier editions, handled the first of those subjects very 
briefly, and with gloves; the excuse, such as it was, 
being that whatever good the book might do, would 
be put out of the reach of common-school pupils by 
"Labor" influences. Having come to realize, however, 
before the book was finished, that it had grown unavail- 
able for such pupils, in this edition I have entirely 
abandoned the attempt to adapt it to them. Yet 
there may be places where enough of the earlier ten- 
derness for the juvenile mind has survived, to demand 
my humble apologies to the dignity of the under- 
graduate. But a much stronger reason for the changes 
regarding the subjects mentioned, was their growing 
importance. In the six years since the second edition 
was published, the "labor question" has become, not- 
withstanding the graft in corporations, the leading 
question of the time. I am sorry that my limits do 
not permit even a fuller treatment of it, but less sorry 
than I should be if I could not refer the reader for 
fuller information to so admirable a book as the "Labor 
" Problems" of Prof. T. S. Adams and Miss Helen L. 
Sumner. Despite the strange showings of figures which 
I have alluded to on page 252, and despite some other 
matters which I cannot endorse, Professor Adams's 
chapter on Strikes and Boycotts surpasses anything on 
the subject which I know. The book has appeared 
since the last edition of this one, and has done not a 



Preface to the Third Edition. 



v 



little to furnish me material for hope that this edition 
may be an improvAnent. 

What I have found to say regarding the right to stop 
work and the right to strike, tho not entirely novel, 
and tho somewhat anticipated even by court decisions, 
has nevertheless played so small a part as yet in dis- 
cussions of the subject, that I cannot help regarding it 
as well worth saying. I am also vain enough to hope 
that the additional matter regarding socialism may do 
a little to clear up in some minds that inevitably foggy 
subject, or at least to show why it is inevitably 
foggy. 

The book is of course "second-hand": to write from 
original investigation in so many fields, would be impos- 
sible: for even if life were long enough, while an author 
would be investigating one department, those pre- 
viously gone over would grow beyond him. The utmost 
possible is the exercise of reasonable care and dis- 
crimination in choosing authorities. This I have striven 
for, but I have not made any attempt like those which 
I have sometimes been uncharitable enough to suspect 
in others, to make the book appear more learned than 
it is, by bothering the reader with citations of authori- 
ties for all the statements. 

Tho disliking excuses, I will allow myself the one 
afforded in this connection, for not having taken the 
trouble to hunt up the names of law cases when they 
were not given where I found the substance of the 
decisions. A book intended primarily for under- 
graduates and general readers, does not need details 
required only by the profession and investigators. One 
of the critics of an earlier edition was at the pains to 
inform his readers that its treatment of law topics 
can be of little use to the profession. It will also be 
of little use to students of Chinese. Perhaps, however, I 
may be excused for saying that other critics (I do not 
know whether of equal authority) have said that the 
book contained a good introduction to the study of the 
municipal law. Whether it did or not, this edition 
contains a better one, largely due to the friends named 



vi 



Preface to the Third Edition. 



below. I have also gleaned a few new points from 
Professor Burdick's "Essentials of Business Law." 

I am indebted for various valuable criticisms of the 
earlier editions to Professor Daniels, Judge Baldwin, 
and Messrs. Samuel Huntington and Ralph Curtis Ring- 
wait of the New York bar. 

My obligations to other writers not consulted for the 
earlier editions, are, I believe, all acknowledged in the 
body of the work. 

I am glad again to name Mr. Neu, and to express 
my continued obligation for his admirable proof-read- 
ing, and for help in the cross-references and index. 

I crave the reader's consideration for the reasons 
set forth in the preface to the first edition, why the 
work is a considerable departure from previous works 
in the same field. 

H. H. 

Nbw York, 
March 29, 1907. 



FROM THE PREFACE TO THE FIRST 
EDITION. 

(March i, 1901.) 

THE MOTIVES. 

This book was written in the hope of doing a little 
something to develop in young people the character of 
mind which is proof against political quackery — espe- 
cially the quackery which proposes immediate cures by 
legislation for the abiding ills resulting from human 
weakness and ignorance. Since the Civil War, America 
has been cursed by such proposals probably more than 
any other country ever was. What beneficent institu- 
tions we have, have all been evolved through the long 
and painful struggles which have at the same time 
evolved character and morality. If Nature's ways are 
plain in anything, they are plain in showing that it is 
only for such prices that she yields such rewards. And 
yet of all our hard-bought institutions, there is scarcely 
one, from a stable currency down to the very right of 
accumulating property, that has lately escaped a strong 
attempt to overthrow it, and to substitute for it some 
invention of the moment — or rather some invention 
bearing a name of the moment, but being really a form 
of some protean error as old as history. 

As these errors all propose to get along faster than 
Evolution, they would of course be impossible to a mind 
habitually recognizing the law of Evolution. Yet that 
law has not even been named, so far as I can recall at 
the moment, in any of the American elementary books 

vii 



viii From the Preface to the First Edition. 

on civic subjects that I have been able to get hold of.* 
This may not in all cases be due to neglect, but some- 
times to the conviction that it is useless to present the 
subject to the young. My view is more hopeful, and 
this book is, perhaps more than anything else, an at- 
tempt to saturate young people's minds with the reali- 
zation that social institutions are evolutions, and there- 
fore (I) that they can no more be modified by laws or 
votes or any other manifestations of human will than 
plants or animals can ; but (II) that they can be modified 
as much as plants or animals can, tho only by the same 
means — careful study of their life-histories and habits, 
and cautious efforts in accordance with the proved con- 
ditions of their well-being; and (III) that they will be 
vitiated or destroyed by forced or ignorant treatment. 

This is why I have spent so much time over such 
topics as early land-tenure and the relations of status 
and contract — in short, over the archaeology of the sub- 
ject. I want to give the pupil a consciousness that en- 
during institutions are growths, and do not spring up 
responsive to any magician's wand, be it in the hands of 
Mr. Altgeld, Mr. Bryan, or even so good a man as Henry- 
George — I want to accustom him, when any method is 
presented for his vote, to ask: Has this thing roots? 

A second motive for the book was to place before 
American youths at least one text-book that should not 
claim that our constitutions — state and national, present 
the final word of human wisdom. Perhaps the admission 
of notorious defects will bring upon the book charges of 
lack of patriotism, yet it is not written in a pessimistic 
spirit. The pessimist generally despairs because achieve- 
ments fall short of ideals: the wise man compares, 
rather, what he an$i his have achieved, with what others 
have achieved. Our government may not be the best, 
but we are too near the best to despair. But if our gov- 
ernment is ideally good already, why bother to teach 

* There is abundant illustration of Evolution in Mr. Fiske's 
44 Civil Government in the United States but I believe the word 
is not even mentioned, perhaps because of the theological preju- 
dices prevailing so far back in the dark ages as ten years ago. 



From the Preface to the First Edition. ix 



anything about it ? : it can take care of itself ; and in fact, 
until lately, our people have generally been taught to 
leave it to do so. 

A third motive of the book has been to get some 
teaching on our constantly recurring questions of money, 
land-tenure, distribution and taxation, into some places 
where Economics are not usually taught, and also to 
get into some places where Economics are taught, a 
fuller treatment of those four topics than is usually 
given. 

A fourth intention has been to spread a just concep- 
tion of Contract. The absence of such a conception is at 
the root of most of the labor troubles, not to speak of 
private breaches of faith. Those who realize the im- 
portance of the subject will not be impatient with the 
rather protracted and abstract discussion that prefaces 
the treatment of the laws relating to it. 

In time the pupil will, as a voter, need to make up his 
mind on many hard subjects — so hard, some of them, 
that for his conclusions, or anybody's, to be taken seri- 
ously, seems almost ridiculous. But I am not sure that 
just that fact is not the most important of all that I want 
him to appreciate — the fact that in broad civic questions, 
the wisest man can only feel his way — as Lincoln did: 
and that of all pests for the voter to avoid, the chief is 
the man with a scheme — be it silverism, greenbackism, 
grangerism, socialism, communism, anarchism, or (I am 
tempted to add) protectionism and militarism, but some- 
times there are circumstances justifying these two. 

This attitude regarding a scheme may seem inconsist- 
ent with my close approach to recommending one re- 
garding taxation. But that approach is only incidental 
to an effort to trace the indications of Evolution. If our 
men of schemes would honestly restrict themselves to 
such efforts, they would be less dangerous. 

I have hoped to add life, as well as significance, 
even at the cost of interruptions, by frequent compari- 
sons of early conditions with present ones. 

I have not hesitated to repeat — even to repeat often, 
where the topic seemed worth iterating or presenting 



X 



From the Preface to the First Edition. 



from several sides. The significance of the matters 
here treated is not as plain as that of the multiplication- 
table, which needs to be presented but once. 

THE MATERIAL. 

From the unlimited range of topics embraced in civic 
relations, how to select the little bookful best adapted to 
the needs of the average American youth, is a hard 
problem. Probably the authors of some of the other 
text-books would be more puzzled to find good reasons 
for my selections, than I am for theirs. They generally 
give much more attention than I do to the anatomy of 
the government — state minutely all the offices, national, 
state and local, and not only the qualifications legally 
required for them, but even for voting for them. Now 
most of these things, so far as they affect a vote, the 
voter, as he grows up, is pretty sure to learn from the 
world; and so far as they do not affect his vote, they 
must be relegated to the vast domain of useless knowl- 
edge — unless indeed he aspire to be, as a politician, 
something more than a mere voter. The few boys, 
however, who have this spark of aspiration, get it from 
the altar of genius, even if it be genius for nothing 
higher than running a primary: and genius teaches 
itself. 

A man who tries to judge broad questions by details 
is not going to get anywhere : they involve too many de- 
tails : he can compass but a small part of them, and is in 
danger of getting the wrong ones and missing the right 
ones. Broad questions can only be judged on broad 
principles. Then, it might be asked: Why expect the 
man of ordinary attainments to judge them at all? I 
never have been able to find out why ; but inasmuch as 
a vote has been given him, that responsibility has been 
laid upon him, whether he is fit for it or not. Well, with 
a fatuity equal perhaps to that which gave him the vote, 
I have tried in this little book to give him some notion 
of the broad principles on which the vote should be 
used. If Ethics — the profoundest and vaguest of all 



From the Preface to the First Edition. xi 

sciences, is taught in some shape from the cradle, is it 
plain that problems of Civics need be entirely neglected 
in all shapes, during adolescence? Frankly, I do not. 
expect to teach very much about them : but I do hope 
to give such a notion of how some sound principles look 
from the outside, that the voter can tell whether they 
are recognized or not by those who seek his suffrages, 
and give his vote accordingly. 

And yet I am far from believing that all of even this 
little book can have much meaning, before it is illumi- 
nated by experience. I do believe, however, that much 
here which may be memorized as little more than dog- 
matic statement, will gain meaning from day to day, 
until it becomes significant ; and I have even some hope 
that if the desperate experiment fails with the young, 
the labor may be rewarded by clarifying to some maturer 
minds a grave problem or two, through the same courses 
of thought (even if borrowed thought) that have, I 
assume, clarified them to my own. 

It may seem inconsistent with the foregoing talk 
about broad principles, that the book includes some 
groups of such specific rules of the Municipal Law as a 
layman ought to know and might have to learn at his 
cost in ordinary business experience. Not only, how- 
ever, do I think that their value makes them a justifi- 
able part of the only teaching of civic relations that 
many of my hoped-for readers are apt to get, but I 
have tried to put even such matter in such a way that 
it will do its share *in impressing the main lesson of 
the book — the evolution of all the elements of social 
order, especially the inevitably imperfect evolution of 
some of the most important elements — "the glorious 
uncertainties of the law ". 

The original design included a second part, on the 
Evolution of Government, to be issued in the same vol- 
ume with the first. The first part, however, as is 
usually the case, outran expectation; and as it has a 
certain completeness in itself, and is long enough to 
take up the time given in the majority of classes to 
the subject, and especially as it contains most of the 



xii From the Preface to the First Edition. 

"practical" matter contemplated in the entire scheme, 
it has been thought best to publish it without waiting 
for the completion of the second part; and perhaps 
to let the completion of that part depend upon the 
reception accorded to the very uncertain experiment 
as tried in the present volume. 

Although in this part the evolution of several institu- 
tions has been considered, the evolution of government 
in general has not. The intention for the second part, 
has been not only to give an account of that, but also, 
as a natural concomitant, to give a fuller idea of the 
structure of government, tho substituting for much of the 
detail usually given in books for the same grade of pupils, 
some of the criticism and suggestion usually avoided. 

I let the foregoing paragraph stand to emphasize this 
one. Since that one was written, I have reread the 4 * Civil 
Government in the United States", by my lamented 
friend Professor John Fiske, and I realize more fully 
than I did in my first reading, that it is in many re- 
spects what, while writing my first part, I have come 
to intend my second part to be. If I ever carry out 
that intention, it will be because of the other respects, 
and especially because of a desire to reach minds less 
mature than perhaps Mr. Fiske's book can reach. 

Meanwhile, and perhaps afterwards (if there ever 
should be an afterwards), Mr. Fiske's book may be 
regarded as the best one known to me for supplementing 
what I have tried to do here. 

t 

AUTHORITIES. 

In addition to some of the older authorities which 
are already matters of course, I am specially indebted 
to the following, most of which are rapidly becom- 
ing matters of course, if not so already. I let the 
list grow larger than is usual in acknowledgments, 
in order that it may serve as a brief bibliography 
for the use of teachers.* — The late David A. Wells's 

* I permit this to stand, tho the present edition is intended 
for a grade of pupils whose teachers will know more of the 
bibliography of the subject than I do. 



From the Preface to the First Edition. xiii 

"Recent Economic Changes" and "Theory and Prac- 
tice of Taxation ",* Professor Mayo-Smith's "Economics 
and Statistics", President Hadley's "Economics", Pro- 
fessor Adams's "Finance", Professor Daniels's "Ele- 
ments of Public Finance ", Professor Seligman's books 
on Taxation, Mr. Shearman's " Rational Taxation ", 
Judge Baldwin's "Modern Political Institutions", Mr. 
Mallock's "Labor and the Popular Welfare" and 
"Classes and Masses", Professor Goodnow's "Municipal 
Problems", Doctor Shaw's books on Municipal Govern- 
ment, the valuable quarterly on "Municipal Affairs" 
published by the Reform Club, especially Dr. Maltbie's 
number on "Municipal Functions", and Mr. Godkin's 
"Problems of Democracy" as well as The Nation 
from the time he founded it. A word of acknowledg- 
ment is also due to the excellent articles on Civic 
questions in Johnson's Cyclopaedia. 

Among elementary books for pupils, I have found 
help in Mr. Raleigh's admirable little "Elementary 
Politics" (which, unfortunately for us, was written for 
England), Professor Robinson's "Elementary Law", 
Professor Bolles's "Commercial Law ", the summary of 
Municipal Law in Mr. Young's "Government Class 
Book", Mr. Fiske's "Civil Government in the United 
States " (tho its field is very different from that of this 
volume), and in several features of Mr. Martin's "Civil 
Government". His summary of the "Establishment 
of Liberty in England" (of course not touched in 
my present volume), seems to me a little gem, tho 
possibly rather condensed for the young pupil. I have 
also found Mr. Ford's "American Citizen's Manual" 
and Mr. Bartlett's "What I ought to know about the 
Government of my Country" handy for quick reference. 

* Two real books that ought to be read by every human being 
old enough and civilized enough to understand thorn; this, too, 
in spite of the fact that the latter was largely written during the 
lamented author's last illness, and therefore lacks the terseness 
and vigor of his earlier work. It appeared after the chapters on 
taxation in this present volume were written , but it was still pos- 
sible to inject from that work much of whatever good they may 
contain. 



xiv From the Preface to the First Edition. 

If I have done what I have attempted, as well as these 
authors have done the very different things which they 
attempted, I ought to be content. 

My hearty thanks are due to Mr. Theodore Neu for 
rare intelligence, interest, and suggestiveness in read- 
ing the proofs and preparing the index. 

I am also under very great obligations to Professor 
Goodnow for reading the proofs, and for calling atten- 
tion to errors. Of course he is not responsible for 
those which remain. I shall be similarly grateful to 
any one pointing out any of them. 



• 



CONTENTS. 



Preface to the Third Edition 

From the Preface to the First Edition 



page ill 



vil 



PRELIMINARY SURVEY. 



Chapter I. — Society's Control of the Individual — 



Sec. i. Introductory. 2. Social Influence and Control: 2 (a), 
through the Family; 2 (b). through Public Opinion; 2 (c). 
through Imitation; 2 (d). through Education; 2 (e). through 
Government. 3. Civic Relations Defined. 4. Government's 
Functions Illustrated. 5. Government's Functions Classified. 
5 (a). Protection of Rights. 5 (6). Promotion of Convenience. 
5 (c). Taxation. 6. Some General Results of Bad Govern- 
ment. 7. Responsibility for Bad Government. 8. Good Gov- 
ernment Requires Intelligence, Character and Effort. 9. Ex- 
tent of Government's Influence. 9 (a). Illustrated by Money. 



Sec. 10. Each Citizen Lives under Several Governments. 
11. Overlappings of Local Governments. 12. Functions of 
Local Government. 13. Of County Government. 14. Of State 
Government. 15. Of National Government. 15 (a). Sover- 
eignty. 



Sec. 16. Legislative, Judicial, Executive. 17. Sources of Gov- 
ernment. 18. The Three Departments Illustrated in Civil and 
Criminal Suits. 19. Legislative, Judicial and Executive Func- 
tions in Local Government. 20. The Functions in Counties. 
21. The Three Functions in States. 22. The Same Functions 
in the Nation. 



Government 



1 



Geographical Divisions of Government. 



Departments of Government. 



xv 



xvi 



Contents. 



book i.— the Protection of rights. 

Chapter II. — Of Rights in General 21 

Sec. 23. Rights Impose Duties. 24. " Greatest Happiness" 
Principle and its Application in the Three Kinds of Law. 
25. Rights and Duties Imply Each Other. 26 Rights Classi- 
fied. 

Chapter III. — Right to Life 25 

Sec. 27. The State's Claims. 28. Humanity's Claims. 29. 
Professional Claims. 30. Life and Work. 31. The Right to 
Work. 31 (a). Subject Only to the State. 31 (6). Picketing 
and Boycotting. 32. Duties Conditioning the Right to Work. 
33. Society's Alleged Duty to Provide Work. 34. The Eng- 
lish Poor Law and the French Workshops. 35. Public Charity. 

Chapter IV. — Liberty 32 

Sec. 36. Boundaries of Liberty. 37. Barbarian Liberty and 
Civilized Liberty. 38. Duties Balancing Rights to Liberty. 
39. State's Right to Restrain Liberty. 40. "Eternal Vigil- 
ance." 41. Constitutional Defences, Bill of Rights. 42. The 
Man with a Pull. 43. Freedom of Opinion. 44. Laws 
Threatening Liberty. 

Chapter V. — The Pursuit of Happiness 39 

Sec. 45. A General Term for Many Rights. 46. Restricted, 
as All Rights are. 47. The Right to Work Involves Rights of 
Property and Exchange. 47^ (a). Limited, like All Other 
Rights. 48. The Rights to Work, to Property and of Ex- 
change Involve Rights to Contract 49. and to Reputation. 
50. State does not Furnish Means %o Happiness, but Only 
Rights to Work for Them. 51. Evolution of Property Rights. 
51 (a). Their Sources — Raw Material, Labor, Ability. 

Chapter VI. — Real Property 44 

Sec. 52. Land and Sea the Source of Raw Material. 53. Early 
Conditions. 54. Communistic Ownership. 55. The Feudal Sys- 
tem. 55 (a). Why an Advance on Communism. 55 (&). 
When Established. 55 (c). Evolution of Hereditary Feudal 
Relations. 155 (d). Guardianship, Disposal by Marriage. 55 (<?). 
Domesday Book. 56. Evolution of Private Ownership. 56 (a). 
Scutage. 56 (6). Leases for Labor. 56 (c). Money Commuta- 
tion of Labor Leases. 57. Land-tenure in America. 58. Land- 
tenure Similar among All Peoples of the Same Grade. 59. Pri- 
vate Property in Land a Great Stimulus to Ability. 60. The 
Strong Man's Chance Not at the Expense of the Weak. 61. 
Proportion of Private Owners Increases with Civilization. 62. 
Landowners the Best Guardians of Government, 63. and the 



Contents. 



xvii 



Most Thrifty Citizens. 64. Exaggerated Claims from the Fore- 
going Advantages. 64 (a). The Right to a Home. 64 (6). The 
Right to a Living. 65. Land Valueless to All but Able Men. 
66. Proposed Reversion to Government Ownership. 67. 
Landowners Support the Government under Either System. 

68. Some Advocate Robbery, which would Disappoint Them. 

69. •The Only Way to Help the Poor is to Help Them Help 
Themselves. 70. The Moral Arguments — Original General 
Ownership. 71. Attempt to Remedy Injustice Sometimes 
only Increases It. 72. Performing Duties of Ownership Breeds 
Rights of Ownership. 73. Rights in Improvements. 74. The 
Unearned Increment. 74 (a). Not Characteristic of Land 
Alone. 75. All Schemes to Abolish Private Ownership are 
Retrogressive. 76. Private Property in Land of Universal 
Importance. 77. Rights in Land Limited like All Rights. 78. 
Rights of Eminent Domain. 

Chapter VII.— Law op Real Property 65 

Sec. 79. The Law in General. 80. Real Estate and Per- 
sonal Property. 81. Laws Protecting Ownership. 81 (a). 
Damages for Trespass. 81 (6). Right of Ejectment. 82. Laws 
Affecting Transfers. 82 (a). Livery of Seisin. 82 (b). Statute 
of Frauds Requiring Written Evidence of Transfer. 82 (c). 
Contracts of Sale. 82 (d). Deeds. 82 (c). Seal and its Effect. 
82 (/). Essentials of Deeds. 82 (g). Dower and Courtesy. 

82 (h). Value of Established Forms. 82 (1). Registry. Title- 
search. 82 (/). Judgments. 82 (k). Statutes of Limitations. 
Prescriptions. Appurtenances. 82 (/). Title Insurance. 82 (m). 
Clouds on Title. 82 (w). Delivery of Deed. 8^. Mortgages. 

83 (a). Bonds. 84. Leases. 85. Rights of Third Parties Re- 
garding Registry. 86. Effect of Fraud. 87. Land Differs from 
Negotiable Papers. 88. Technical Meaning of "Estate" in 
Land. 89. Rights under Estates for Years. 89 (a). Repairs. 
89 (b). Subletting. 89 (c). Terminability, Notice. 90. Rights 
under Life Estate. 91. Under Estates at Will. 92. Appur- 
tenances. 92 (a). Party Walls. 92 (6). Land beside Roads. 
Q2 (c). Land by Water. 93. Restrictions. 94. The Torrens 
System. 

Chapter VIII.— Personal Property 87 

Evolution of Rights in It. 

Sec. 95. Product Varies with Abilitv. 05 (a), even the 
Product of the Lowest Laborers. 96. Difficulty of Adjusting 
Rights between Ability and Labor. 97. General Functions ot 
Ability. 97 (a). The Civilized Man Loses the Savage's Inde- 
pendence. 97 (6). Things Made to Embody Thoughts. 97 (c). 
Averages and Ability. 97 (d). The Lower Depends on the 
Higher. 97 (e). "Finds Work." 97 (/). Increases Product. 
97 GO- Saves Waste. 98. Detailed Functions of Ability. 



xviii 



Contents. 



98 (a). Prophesying Wants. 98 (6). Raising Capital. 98 (c). 
At the Works. 98 (d). Outside of the Works. 99. Popular 
View of the Enterpriser. 100. Divisionjof Labor. 101. Few 
Men can Conduct Large Enterprises. 102. Ability Outside of 
Tangible Production. 103. 4 4 The Great Industry" Cheapens 
Product. 104. Enterpriser's Income Not at Expense of Labor. 
105. Invention and Evolution. 106. Labor Abounds in Poojest 
Countries. 107. The Enterpriser must Pay Good Wages. 
107 (a). Often in Bad Times. 108. Where Ability's Reward 
does Come from. 109. Production Not All by Hand. no. 
Destruction of Bad Economics. in. Values Depend on 
Sound Morals. 112. Paradoxes of Distribution. 113. Para- 
doxes of Opinion. 114. Why Returns of Labor are Nearly 
Fixed. 115. Why Those of Ability Vary Widely. 116. Capi- 
tal's Return More Like Labor's than Ability's. 117. Ability 
cannot Waste Time and Strength in Grinding Labor or Capital. 
118. Capital and Labor Powerless without Ability. 119. The 
Rates of Division. 120. Enterprisers Generally Get Less than 
Nothing. 121. Handworkers of Special Ability. 122. Prop- 
erty Not All Tangible. 123. Comparative Profits in Different 
Fields of Ability. 124. Why so Few have Great Ability. 
125. Discovery of the Foregoing Truths. 126. Ability In- 
creasing. 127. Suum Cuique. 128. Minimum Wage and Slid- 
ing Scale. 129. No Lack of Opportunity. 130. But Few Able 
to Embrace It. 131. Is Inequality of Fortune Right? 132. 
Evils have their Uses. 

Chapter IX. — Property as Capital 116 

Sec. 133. As Much Entitled to Government's Protection as 
Wages. 134. A Man who can Use Money can Hire It. 135. 
What Capital Consists in. 136. Rent. 137. Interest. 138. 
Usury. 138 (a). Laws against It Useless. 138 (6). Disappear- 
ing from Enlightened Communities. 138 (c). Hard on Bor- 
rowers. 139. Needs for Associating Capital. 140. Incorpora- 
tions. 140 (a). As Affecting Liability. 140 (6). Perpetuity. 
140 (c). Stocks and Bonds. 141. Large Corporations Not All 
Owned by the Rich. 142. Irresponsibility of Corporations. 
143. Very Small Corporations Undesirable. 144. Why Labor 
Hates Corporations. 145. Danger of Monopoly. 

Chapter X. — Competition, Monopoly and Industrial 

and Labor Trusts 127 

Sec. 146. Rights of and to Competition. 147. Hated by the 
Lazy and Stupid. 148. Benefits Illustrated. 148 (a). In Do- 
mestic Convenience. 148 (b). In Travel. 148 (c). In Com- 
mercial Traveling. 148 (</). In Regulation of Prices through 
Demand and Supply. 148 (e). Minor Exceptions. 149. Evils 
in Competition. 149 (a). Suppressing Incapacity not among 
Them. 149 (6). Nor is Poverty. 149 (c). But Wastefulness is. 
150. Public Seldom Gainer by Wasteful Competition. 151. 



Contents. xix 



Codperation and Competition. 152. Capital Trusts. 152 (a). 
Their Economy. 152 (6). Not Generally Profitable. 152 (c). 
Their Monopoly Sometimes Causes its Own Cure, 152 (d). 
and Sometimes does Not. 153. Property Rights do Not 
Always Include Monopoly Rights. 154. State Control. 154 (a). 
By Anti-trust Laws. 154 (6). Capital Trusts and Labor 
Trusts. 154 (c). By Fixing Prices. 154 (</)• By Eminent 
Domain. 154 (e). Danger of Government Tyranny. 155. 
Effect of Great Aggregations of Capital on Legislation. 156. 
Socialism as a Remedy. 157. The Only Real Remedies. 
1 57 ( a )- An Illustration. 

Chapter XI. — Rights in Natural Monopolies 144 

Sec. 158. Some Things are Inevitably Monopolies. 158 (a). 
But the Earth Not One of Them. 150. Why Railroads are 
Apt to be Monopolies. 159 (a). Why They Need Government 
Authorization, 159 (6). and should Pay for It. 159 (c). So 
with Other Facilities. 160. Those in America Being Generally 
Grabbed by the Politicians. 161. Should Not be Sold Out- 
right. 162. How Natural Monopolies Become Personal Prop- 
erty. 

Chapter XII. — The Law op Rights in Personal Prop- 
erty 148 

Sec. 163. Differences between Law of Personal Property and 
that of Land. 163 (a). Personal Property Seldom Registered. 
163 (6). Important Kinds Passed by Endorsement. 163 (c). 
Can Take One's Own Wherever Found, and in Some Cases by 
Force. 163 (d). Ownership of Some Kinds can be Lost With- 
out Neglect. 163 (e). Can be Mortgaged without Registry if in 
Mortgagee's Possession. 164. Pledges. 165. Personal Prop- 
erty the Great Field of Contract. 

Chapter XIII. — Contract 152 

As an Element in Civilization. 

Sec. 166. Difference between Contract Rights and Property 
Rights. 167. Contract, Agreement, Bargain. 168. Contract 
Possible Only to the Free. 169. Contract an Education in 
Freedom. 170. Under Contract, only Able Employers can Se- 
cure Labor. 171. Status versus Contract. 172. Contract, 
Freedom and Private Property All Evolve Together. 173. As 
They Evolve, Militarism Declines. 174. Because it is a Form 
of Status. 175. Fighting versus Producing. 175 (a). Illus- 
trated in Nations of To-day. 176. Why Private Property is 
Essential to Advance beyond Status. 177. Civilization and 
Trade Go Together. 178. Breaking Contracts and Advocating 
Socialism. 



XX 



Contents. 



Chapter XIV. — General Law op Contract 159 

Sec. 179. Essentials of a Contract. 179 (a). Illustrations. 
180. Natural Love and Affection. 181. Promises and Con- 
tracts. 182. Legal Fiction. 183. Mutuality in Contracts. 
184. Law and Religion. 185. Justice and Honor. 186. Con- 
tracts the Law will not Enforce. 186 (a). For Wrong-doing. 
186 (b). Wagers. 186 (c). "The Act of God or the Public 
Enemy." 187. Law Imposes Self-preservation. 188. But can- 
not Furnish Wisdom. 189. Contracts which the Law Assumes. 
190. Estoppel. 191. Carelessness and Fraud. 192. Fraud 
Never Denned. 193. Statutes of Limitations Again. 194. 
Force Vitiates Contract. 195. Courts Needed against Ignor- 
ance as much as against Fraud. 195 (a). Illustrated in Con- 
fusion, Construction and Friendly Suits. 196. Contracts when 
Parties do not Meet. 197. The Law is an Evolution. 

Chapter XV. — Law of Contracts Concerning Personal 

Property 173 

Sec. 198. Sale and Delivery, 198 (a), as Generally Affected 
by the Statute of Frauds, 198 (6). by Part Payment. 198 (c). 
Prior Lien. 199. No One can Sell More Title than He Has. 
200. Possession and Ownership. 201. Owner must not Secure 
Possession by Force. 202. Delivery and Acceptance Com- 
plete Ownership. 202 (a). Delivery to Agent or Carrier Good. 
203. Conditional Sale. 204. Option. 205. When Defects must 
be Disclosed. 206. Warranty. 207. Suretyship. 208. Insur- 
ance. 209. Bailments 209 (a), on Different Kinds of Goods. 
209 (6). "Common Carrier" Defined. 209 (c). Limiting Lia- 
bility without Contract. 209 (d). Bill-of-Lading. 209 (e). 
Hiring. 209 (/). The Law does not Require Impossibilities. 

209 (g). Bailment without Consideration. 209 («). Liability 
of Innkeepers. 209 (t). Pledge. 209 (/). General Principle of 
Liability of Bailees. 210. Tender. 210 (a) . Kinds of Money in. 

210 (6).- Determined by Congress. 211. Contractual Disabili- 
ties. 212. Some Limits of Quantum Valebat. 212 (a). En- 
richment. 213. The Law Protects the Weak. 

Chapter XVI. — Law op Contracts for Personal Rela- 
tions 190 

Sec. 214. Agency. 214 (a). Authorized Acts Bind Principal. 
214 (6). Agent Liable for Exceeding his Authority. 214 (c). 
Principal Bound Also by Acts Third Party has Good Reason 
to Believe Authorized. 214 (</). Agency through Necessity. 
214 (e). Agent cannot Make any Profit for Himself. 214 (/). 
The Superior is Generally Liable, 214 (g). even for Wrong 
Done in Course of Routine Duties, 214 (h). which Justice to 
the Sufferer Generally Requires. 214 (1). Both Principal and 
Agent Liable in Wrong-doing. 214 (/). Classes of Agents. 
215. Partnership. 216. Service. 216 (a). Discharge for Cause 



Contents. xxi 

Stops Pay for Rest of Term. 216 (6). Discharge without 
Cause, or Leaving for Cause, does not. 216 (c). Both Bound 
for the Entire Term. 217. Remedies for Broken Contracts. 

Chapter XVII. — Law of Some Quasi-Contractual Re- 
lations. .• 190 

Sec. 218. Trusteeship in General. 219. Safeguards. 220. 
Assignees of Bankrupts. 220 (a). Justice of Discharging 
Bankrupts. 221. Administrators. Devolution of Intestate Es- 
tates. 221 (a). Rights of Relatives of Intestates. 222. Execu- 
tors. Wills. 222 (a). Who cannot Make Wills. 222 (6). Re- 
strictions on Alienation. 222 (c). Devises for Educational or 
Charitable Uses. 223. Guardianship. 224. Need of Probate 
Courts. 225. Trustees for Defectives. 226. Court Supervision 
of Trustees in jGeneral. 

Chapter XVIII. — Personal Property 208 

Schemes for Distributing It More Evenly. 

(I) Scamping, Forbidding Work, Destroying Product, Anar- 
chism, Communism. 

Sec. 227. Poverty has No Causes. 228. Scamping Work. 
228 (a). Keeps the Scamper Out of Jobs. 228 (6). He Gets 
Only One Profit but Pays Many. 228 (c). Cannot Long Re- 
ceive Good Wages unless Earned. Piecework. 229. Pretend- 
ing and Forbidding Labor. 230. 4 'Shutting Down" a Different 
Case. 231. Destruction as an Aid to Production. 232. Only 
One Class of Many Schemes to Get Something Out of Nothing. 

233. People Generally Consider Only Income, Not Outgo. 

234. Anarchism. 234 (a). Badness of Present Laws docs not 
Prove Goodness of Proposed Changes. 235. Communism. 

235 (a)- $1,200 Apiece. 235 (6). Sudden Wealth a Doubtful 
Blessing. 235 (c). Would Last but a Little While, 235 (d) . 
and then there would be Less than Now. 235 (e). Meaning- 
less without Robbery. 235 (/). Many Kinds of Wealth cannot 
be Divided without Being Destroyed. 

Chapter XIX. — Personal Property (Continued) 225 

Schemes for Distributing It More Evenly (Continued). 
(II) Socialism. 

Sec. 236. Socialism. 236 (a). Wages could not Rise. 236 (6). 
Impracticability of Political Management. 2^6 (c). Losses to 
Education, Charity and Libertv. 236 (d). Forcing Ability. 

236 (e). The Argument from Experience. 236 (/). Can be 
Undertaken when Government is its Own Customer. 236 (g). 
Private Initiative Essential to Variety. 236 (h). General Gov- 
ernment Production Attacks Property, Contract and Charity. 
236 (t) . Futility of Attempting It by Eminent Domain. 236 (J). 



xxii Contents. 

Effect on Laborers. 236 (k). A Premium on Laziness. 236 (/). 
Would Destroy Freedom. 236 (m). The Unemployed. 237. 
Names Socialism and Individualism. 237 (a). Socialism a 
Vague Name. 237 (6). At Least Three Meanings. 238. So- 
cialism against Competition. 239. All Experience for Indi- 
vidualism. 240. Socialism and Maine an Illustration. 241. 
Present Agencies toward Same Ends. 242. No Magic in 
Laws and Names. 243. Another Specimen. 244. Need and 
Desert. 245. High-pressure Progress. 246. Socialism, when 
Possible, will be Needless. 247. The Web of Civilization. 

Chapter XX. — Personal Property (Continued) 243 

Schemes for Distributing It More Evenly (Continued). 

(Ill) Trade-union Coercion. 

Sec. 248. Corner of Supply of Labor. 248 (a). Justifiable 
Only in Self-defence. 249. Demand and Supply in Labor. 

250. Wages Necessarily Limited 250 (a), by Demand for 
Product, 250 (b). by Competition, 250 (c). by Invention. 

251. False Justifications for Coercion. 252. Aimed against 
Laborer, Employer and Public. 253. Coercing the Employer. 
254. The Strike. 255. Conspiring to Stop Work. 256. Other 
Coercions. 257. Misleading Statistics of Strikes. 258. Co- 
ercing the Laborer. 258(a). The Labor Trust. 259. Coercing 
the Public. The Union Label. 260. A Second Illustration. 
261. The Right to Stop Work. 262. The Community's De- 
fence. 263. Society Organizing in Self-defence. 264. Educa- 
tional Results. 264 (a). The Community's Defence will De- 
fend the Workman. 

Chapter XXI. — Personal Property (Continued) 265 

Schemes for Distributing It More Evenly (Continued). 

(IV) Labor and the Law. 

Sec. 265. Natural Law and Civic Law. 265 (a). The Law of 
Conspiracy. 265 (b). The "Corner" Again. 265 (c). Mali- 
cious Intent. 265 (d). Labor-saving Machinery. 265 (e). The 
Open Shop. 265 (/), " Immediate Interest" and the Sympa- 
thetic Strike. 265 (£). Prof. Adams' Summary. 265 (h). Con- 
flicting Laws. 265 (t). Duty of District Attorneys. 266. The 
Workman's Freedom. 267. The Law Chaotic. 268. Picketing 
Unlawful. 269. Unions* Liability for Damages. 26Q (a). Mis- 
demeanor as a Substitute. 270. Some Summaries ot the Law. 
271. Injunctions. 272. Regulation of Wages, Hours and Con- 
ditions. 272 (a). The Labor Trust Again. 272 (b). Protecting 
the Laborer against Himself. 272 (c). Wages Unlike Condi- 
tions. 272 (d). The Living Wage. 272 (e). Too Much Care 
Enervating and against Liberty. 272 (/). Extremes and the 
Medium. 



Contents, 



xxiii 



Chapter XXII. — Personal Property (Continued) 289 

Schemes for Distributing It More Evenly (Continued). 

(V) Remedies on Trial. 
Sec. 273. Industrial War and Industrial Law. 274. Legal 
Experiments in Australasia. 274 (a). Their Results to be Dis- 
counted for American Conditions. 275. State Competition with 
Monopolies. 275 (a). In Lending Capital. 275 (0). In Some 
Industries. 276. The Minimum Wage. 276 (a). Against 
Sweating. 276 (6). Sought by Good Employers. 276 (c). How 
Regulated. 276 (d). Not Always Effective. 276 (e). Recru- 
descence of the Sweat-shop. 276 (/). Exceptions Allowed. 
276 (g). High Prices Resulting. 276 (h). Bolstering up Needed. 
276 (?)• Points to State Employment and Socialism. 277. 
Statute Law and Natural Law. 278. The Arbitration Courts. 
278 (a). Started to Prevent Strikes. 279. Ineffectiveness of 
Voluntary Arbitration. 280. The First Compulsory Arbitra- 
tion Act. 280 (a). Recognized Only Unions. 280 (6). Could 
Dismiss Trivial Claims. 280 (c). Damages. 280 (d). Faith- 
ful Acceptance of Decrees. 280 (<?). Competence of Courts in 
Business Affairs. 280 (/). Effect on Strikes. 280 (g). Spread 
of the Courts and Unexpected Activity. 280 (/t). Both Sides 
Arranged Cases to Refer. 280 (*). Courts Tried to Follow the 
Market. 280 (/). Court's Power of Initiative. 280 (Ar). Ques- 
tion of Overcrowding. 281. Aspects in 1890. 282. A Theory 
of Wages and Prices. 283. Mr. Lloyd's Conclusions in 1900. 
284. Mr. Reeves in 1903. 285. Claims Continued Success. 286. 
Judge Backhouse's Testimony. 287. The Courts to Keep the 
Peace. 288. Details by Mr. Reeves. 289. Dr. Clark in 1906 
not Quite so Optimistic. 290. Courts Now Have Legislative 
Power. 291. Laws against Strikes. 292. Current Law Pro- 
hibits Sympathetic Strikes. 293. And Makes Awards Binding 
in Adjoining Districts. 294. Awards Evaded. 295. Hard to 
Fit Conditions. 296. Danger of Over-regulation. 297. Pro- 
motes Centralization of Industry. 298. And Uniformity of 
Wages. 299. But so Minimizes Oppression. 300. Only One 
Side can Pay Damages. 301. But Moral Sanction Often 
Effective. 302. Continued High Prices and Palliatives. 303. 
Courts Consider Cost of Living, and Profits and All Condi- 
tions. 304. Startling Declaration of Court's Powers. 305. 
Supports the Closed Shop — Conditionally. 306. Political and 
Class Legislation by Courts. 307. Curtails Freedom of the 
Press. 308. And "the Obligation of Contracts". 309. And 
the Right of Assembly. 310. And Trial by Tury. 311. At- 
tacks on Liberty not Premeditated. 312. New Conditions, 
Unexpected Results. 313. Yet All Admitted to be Progress 
toward Socialism. 314. Has Experiment Proved Socialism at 
War with Liberty and Progress? 315. No Business Disasters 
yet. 316. Experimenting in Prosperous Times. 317. Dis- 



xxiv 



Contents. 



agreement as to Prospects. 318. Increased Fealty to Law. 
319. The Equilibrium Unstable. 320. The Latest Word. 321. 
Repair as Likely as Failure. 322. Gains in Prosperity may 
Carry through Adversity. 322 (a). America must Change. 

Chapter XXIII. — Personal Property (Continued) 325 

Proved Methods for Diffusing It More Evenly. 
Sec. 323. Progress in General. 324. Diffusion of Wealth 
Depends on Diffusion of Ability. 325. Averages Tend to Rise. 
326. Diffusion Increasing. 327. *'Rich Richer, and Poor 
Poorer" is not True in Civilized Countries. 327 (a). Pendu- 
lum Swings Backward in 1903. 327 (6). Recent Reduction in 
Hours. 328. Increase in Wages and Decrease in Other Prices 
Come Largely from Capital's Share, 329. and from Labor's 
Increased Ability, 330. and from Diffusion of Honesty, 330 (a), 
which Makes Everybody's Money go Farther, 330 (6). especially 
Honesty in Government, 331. and from Creating and Supply- 
ing New Wants, 331 (a), mainly through Labor-saving Machin- 
ery, 331 (b). which, tho of Some Harm at the Outset, 331 (c). 
is but Seldom of Any Now. 332. A Man Secures Wealth Him- 
self 332 (a), by Forehandedness against Hard Times, 332 (6). 
in which Prices of Necessities Tend to Keep Up, while those of 
Luxuries Fall. 332 (c). By Cultivating Ability. 333. Poverty 
Seldom Blameless. 334. Most Rich Men Born Poor. 335. 
Happiness not Dependent on Wealth. 736. Wise Philan- 
thropy Necessary to Civilization. 336 (a). It should Continue 
on Present Lines. 336 (6). It should Help Only Those that 
cannot Work. 337. Province of the Law. 337 (a). Cannot 
Discriminate between People. 338. Benevolence does not 
Prevent Accumulating Wealth. 339. Speculation. 340. Law 
cannot Regulate Wealth Wisely. 340 (a) Must not Paralyze 
Ability. 341. Duties of Wealth. 341 (a). In Politics. 341 (6). 
In Charity and Education or Even in Sport. 342. America's 
Rich Men Peculiarly Oblivious of Public Duty. 343. Useless 
Rich Man a ' ' Dependent ". 



BOOK II.— THE PROMOTION OF CONVENIENCE. 

Chapter XXIV. — Preliminary Survey 357 

Chapter XXV. — Money 359 

General Considerations. 
Sec. 344. Reasons for Studying Money. 345. Barter and 
Money. 346. Swindling by Money. 347. Kinds of Money. 
348. Qualities °f All Money. 349. Bad Money as Legal Ten- 
der. 350. Definition Reached. 351. Bad Money Buys Less 
than Good. 352. Value in Paper Money. 353. Fiat Money, 
Token Money. 354. Redemption Money. 



nor tne wass tnat riancues i^easi uoia. 305. ine ranic 01 93. 
365 (a). Begins with Alarm in Europe. 365 (6). Business Suf- 
fers. 365 (c). Kansas Tries a New Way of "Bleeding". 
365 (d). Hoarding Begins. 365 (e). The Banks and the Poor. 



Contents. xxv 

Chapter XXVI. — Money (Continued).. 366 

Some American Experience. 
Sec. 355. How Paper Money Cheated Creditors, 355 (a), 
and Raised Prices. 356. "Never Mind Europe". 357. Effect 
of Money Not Payable in Gold. 358. Why the Silver Dollar 
has Depreciated. 359. Why Coins were not Made Heavier. 
360. American Remonetization in '78 and '90. 361. The Ra- 
pacious Fooling the Ignorant. 362. Who Profits by Light- 
weight Silver? 363. The Poor are not the Debtor Class, 364. 
nor the Class that Handles Least Gold. 365. The Panic of '93. 
" ' ^ ' • in ~ 

is 

365 (/)• Cleveland Stops the ^ahic, 765 (g). but at Heavy Cost. 
366. Government Banking. 367. 16 to 1". 368. Improved 
Trade Balance Supplies Gold. 369. But that cannot be 
Depended upon. 370. Light-weight Silver Money no New 
Scheme 

Chapter XXVII. — Money (Continued) 380 

Needs for the Future. 
Sec. 371. The Best Safeguard. 372. The Safest Money. 
373. Paper Better than Light-weight Silver. 374. Safety in 
Large Bills. 375. Only Sate Silver Certificates. 376. Objec- 
tions to All Government Notes. 377. Yet Coin Insufficient, 
377 (a), and Inelastic, 377 (b). and Eats up Interest. 378. 
Good Paper Currency Preferable. 379. But not from Govern- 
ment. 380. Essentials of Banknotes. "Wildcat" Money. 
^8i. Essentials of a Sound System. 382. Basis for an Elastic 
Currency. 383. The Farmer s Needs. 383 (a). Partly his Own 
Lookout. 383 (6). Remedy for Legitimate Needs. 

Chapter XXVIII. — Public Works 39I 

Extra-M unicipal. 
Sec. 384. Roads. 384 (a). As Spreading Civilization. 384(6). 
Evolution in Our Race. 384 {c). Bad American Organization! 
385. Bridges. 386. Regulation. Ownership. Operation. ^87! 
Ferries and Docks. 387 (a). Municipal and Private Con- 
tracts. 388. Railroads. 388 (a). Superior Service in America 
and England. 388 (b). Italy. 388 (c). Germany. 388 (d). 
Government Operation in America. 388 (e). American Con- 
struction Less Thorough, 388 (/). and Incidentally Less Care- 
ful of Safety. 388 (#). "Freight Discriminations. 388 (/*). 
Consolidation and Competition. 388 (i). Constitutional Ques- 
tions. 388 (7). Taxation of Franchises. 388 (k). Corporation 
Graft and Political Graft. 388 (/)• American Attempts at 
Government Regulation. 388 (m). Unsuccessfulness of Gov- 
ernment Regulation not Complete Argument for Government 



xxvi Contents. 

Operation. 388 (n). "Labor" under Government Operation. 
388 (o). Improvements Possible under Private Control. 

388 lp). Government Control of Private Operations. 388 (</). 
Government Aids and Politics. 388 (r). The Conclusion. 
389. Post-office and Express. 389 (a). City versus Country. 

389 (6). Favoritism to Papers and Periodicals. 389 (c). Com- 
pared with Other Countries. 389 (</). Damage to Literature. 
389 (e). Government versus Private Enterprise. 389 (J). Best 
where People Watch It Most. 390. Telegraph. 

Chapter XXIX. — Public Works (Continued) 420 

Municipal. 

Sec. 301. Street Railways. 391 (a). Evolution. 391 (6). 
Municipal Operation Increasing in England, Little on Conti- 
nent, in America None. 391 (c). Need of Constant Govern- 
ment Inspection. 391 (J). Municipal Sharing of Profits Ad- 
vancing in America. 391 (e). Ownership in America. 391 (/). 
Argument for Municipal Operation. 391 (g). American and 
European Conditions. 391 (h). Glasgow. 391 (*). Great Brit- 
ain versus America. 391 (j). Nashville. 391 (k). Rochester. 
^91 (/). The "Increment" in Franchises. 391 (m). Should be 
^eased but not Sold, and be under One Management. 391 (n). 



Rates of Fare. 391 (0). Deteriorating Private Service may 
Compel Municipal Experiment. 391 (p). Some Other Ex- 
periments Desirable First. 392. Waterworks. 392 (a). Why 



Fit for Municipalization. 392 (6). Health Questions. 392 (c) 
Municipal Management Naturally Wasteful. 393. Lighting 
393 ( a )- Craves Municipalization Less than Water. 393 (6). 
Cheapened by It in Some Places in Europe. 393 (c). American 
Reports Unreliable but Increasingly Discouraging. 393 {d). 
Peculiar Case in Richmond. 393 (c). Other American Cities. 
393 (/)• General Considerations. 393 (g). Electricity. 393 (h). 
Electricity versus Gas. 303 (*). Major Darwin on Utilities 
Already Treated. 394. Telephone. 305. Tearing up Streets. 
Tunnels for Pipes, Wires, etc. 396. Advertising Signs. 397. 
Summary. 

Chapter XXX. — Latest Aspects of Government Oper- 
ation 447 

Sec. 398. Platonists and Aristotelians. 399. Major Darwin 
to 1903. 400. Municipal Operation Retarding Development. 
400 (a). Dogs in the Manger. 400 (b). English Municipaliza- 
tion Obstructive. 400 (c). Strangling Private Enterprise. 
400 (d). Franchises too Short. 400 (e). Ownership Loaded 
with Operation. 400 (/). Results in Number of Lighting Plants 
and Telephones. 400 (g). "Politics". 400 (h). English Mu- 
nicipalization Dangerous to the Purity of Government. 400 (t) . 
Leaves Out the Able Man. 400 (j). Reversal of English Sen- 
timent. 401. Russia and Socialism. 402. Australasian Ex- 



Contents. 



xxvii 



perience. 403. Conditions Unprecedentedly Favorable. 404. 
Government Railroads Run at a Loss. 405. Taxes Highest 
among Civilized Peoples. 406. Vice of Statistics. 407. Tele- 
phones and Coal-mines at a Loss. 408. Government Success in 
Money-lending. 409. Life-insurance. 410. Conclusions Nega- 
tive. 411. Laborers Demoralized. 412. Some Fallacies. 413. 
The Latest American Experience. 413 (a). Omaha. 413 (6). 
A Weak Showing. 413 (c). The Strong Man will Control 
under any System. 413 (d). Monopoly and Privilege. 
413 (e). Our Private Initiative Better than Europe's. 413 (/). 
Democracy on Trial. 413 (g). Some Interesting Experiences. 

413 (/t). Fallacious Reasoning. 413 (*). Desirability of Pub- 
licity and Commissions. 413 (j). Monopolies the Ideal Field of 
the State when Practicable. 414. Summary and Conclusions. 

414 (a). English Taxation Increased without Proportionate Re- 
sults. 414 (0). English Municipalization Obstructive. Espe- 
cially to Inventive Talent . 4 1 4 (c) . " The Government Stroke ' ' . 
414 (d). Municipalization Desirable Only as Defence against 
Monopoly. 414 (e). Municipalization as Training in Citizen- 
ship. 

Chapter XXXI. — Peculiar American Municipal Diffi- 
culties 473 

Sec. 415. American Municipal Corruption. 416. New York 
in 1870, 416 (a), in 1894, 416 (6). in i8q8. 417. City Works 
are the Plums of Rural as well as Urban Politicians. 418. The 
City Contrasted with the Nation. 419. Contractors in Office. 

420. National Parties in Local Affairs. 420 (a). Partly Caused 
by Method of Electing U. S. Senators. 420 (6). Corrupts Both 
National and Local Politics. 420 (c). Paradoxes of Democracy. 

421. Civil Service Reform as a Remedy. 422. State Functions 
to the State, Local Functions to the Locality. 422 (a). Edu- 
cation. 422 (6). Police. 423. America Alone in Confusing 
Local and National Politics. 424. Vast American Wealth and 
Good Nature Promote Carelessness. 425. Corruption of Voters 
under the Guise of Charity. 426. Non-taxpayers Voting. 
426 (a). Tilden Commission's Proposed Remedy. 426 (0). 
Local Suffrage Rights Differ from Others. 426 (c). Limited 
Local Suffrage in AH Well-governed Cities. 426 (d). Where 
the Non-voter is Best Taken Care of. 426 (<?). America can 
Only Improve the Voter and Limit what He Controls. 427. 
Universal Suffrage Logically Implies Individualism. 

Chapter XXXII. — Recreations and Other Help to the 

Less Fortunate Capable 490 

Sec. 428. Museums and Libraries. 429- Parks. 430. Clear- 
ing Slums. 430 (a). Possible Only under Eminent Domain. 
430 (6). Graft. 430 (c). The Negative Side. 430 (<i). Success 
under Private Enterprise. 431. Housing the Poor. 431 (a)- 
Community should Regulate It in Self-defence. 432. Personal 



xxviii 



Contents. 



Conveniences, Army Outfitting ? etc. 433. Economy and Civ- 
ilization Both Require Chanty, 433 (a), preferably from 
Individuals. 434. Hospitals and Asylums. 435. Relief 
to Individual Poor. 436. Pawnshops. 437. Savings-banks. 

438. Lodging-houses. 438 (a). Throw Light on Street-begging. 

439. Labor Bureaus. 440. Insurance. 441. General Conclu- 
sions Regarding Charity. 441 (a). Mutual Help Better than 
Government Help. 441 (6). The Church, the State, the Philan- 
thropist. 441 (c). The Taxpayer. 441 (ci). Many Improvements 
not at Taxpayers' Expense. 

Chapter XXXIII. — The Defective Classes 507 

Sec. 442. The Persistently Poor. 442 (a). Neglect Increases 
the Number. 443. The Insane. 444. The Criminal. 444 (a). 
Generally Defective. 444 (6). One Wrong Step does not Dem- 
onstrate a Criminal. 444 (c). The Indeterminate Sentence. 
444 (d). Cheaper to Keep Rounders Permanently. 444 (e). 
Prison Labor. 445. Euthanasia. 446. A Society Able to Use 
Ideal Remedies will not Need Them. 447. Advisability of 
Death as a Penalty. 

Chapter XXXIV. — The Young; Education 517 

Sec. 448. Nurture. 449. Education. 449 (a). The Illiterate 
Voter. 449 (6). Unusable Education. 449 (c). Usable Edu- 
cation. 449 (J). Practical Education no Foe to Poetry. 
449 (r). Pauperization. 449 (/). State's Responsibility Estab- 
lished. 449 (g). Parents should Pay when Abie. 450. The 
Higher Education. 450 (a). Not Well Conducted by Political 
Pulls. 450 (6). The State, the Church, the Philanthropist. 

Chapter XXXV. — General Conclusions on the Sphere 

of Government 523 

Sec. 451. Individualism and Collectivism. 452. Municipaliza- 
tion Increases with Independence, Decreases with Police Con- 
trol. 452 (a). Increases with Good Local Government. 453. 
Necessary Limits. 453 (a). Effective Industry Requires Com- 
petition. 453 (b). Mainly Determined by Natural Monopoly. 
453 W- Tax for Commodities Universally Used, Charge for 
Others as Used. 454. The Fundamental Question. 455. Gov- 
ernment Service Outside of Monopolies Demoralizing to People 
and Officers. 

BOOK III.— TAXATION. 

Chapter XXXVI. — General Considerations on Taxa- 
tion 529 

Sec. 456. Taxes not the Only Source of Revenue. 457. In- 
terest and Importance of the Subject. 458. Everybody Pays 
Taxes. 459. Kates in Different Countries. 460. Methods In- 
fluence Rate, 460 (a), and Morality, Prosperity. Peace, Stable 
Government, and Even Health and Life, 460 (6). and Move- 



Contents. 



xxix 



ments of Capital and Ability. 461. Taxation and Civilization. 
462. Opposite Methods Illustrated. 463. Direct and Indirect 
Taxes. 464. Shifting of Taxes. 464 (a). Need of Free Com- 
petition. 464 (6). Prices Highest where Taxes are Highest. 

Chapter XXXVII. — Indirect Taxes 539 

Sec. 465. Excise. 465 (a). Taxes may Limit Dangerous 
Pursuits. 466. Duties. 466 (a). Encourage Home Produc- 
tion. 466 (b). Tariff Wars. 466 (c). The Foreigner Sometimes 
Pays the Tax. 466 (d). Early American Experience. 466 (c). 
From the Revolution to the Civil War. 466 (/). Since the Civil 
War. 466 (g). Industrial Effects. 466 (It). Both Parties Cor- 
rupted. 466 (1). Tariffs Tend to Expand. 466 (/). Protection 
and Wages. 466 (fe). Numbers Concerned. 466 (/). Gluts. 
466 (m). Effect on Trusts. 466 (»). Conclusions. 466 (0). 
Causes of American System. 466 (p). Expert Opinion on 
American Method. 467. Stamp-taxes. 467 (a). Both Direct 
and Indirect. 467 (6). Often Merely a Petty Nuisance. 

Chapter XXXVIII. — Indirect Taxes (Continued) 556 

General Conclusions. 
Sec. 468. Indirect Taxes Expensive to Pay and to Collect. 
468 (a). Hard on the Poor. 468 (b). Stimulate Corrupt Legis- 
lation. 468 (c). Fail to Stimulate Interest in Government. 
468 (d). Why They are Popular. 468 (e). Summary for and 
against. 

Chapter XXXIX. — Inquisitorial Direct Taxes 562 

Income and Inheritance Taxes. 
Sec. 469. Direct Taxes Divided into Inquisitorial and Ob- 
vious. 470. Income-tax. 470 (a). Falls Only on Successes and 
Active Property. 470 (b), and is Proportioned to Ability. 
470 (c). Like All Inquisitorial Taxes, a Premium on Lying. 
470 (d). Violates Rights of Privacy. 470 (e). Generally 
Doubles Taxation. 470 (J). As Illustrating Progressive Taxa- 
tion. 470 (g). Discrimination of Sources. 470 (It). As Equal- 
izing Fortunes. 470 (t). As Offsetting Injustice in Other 
Taxes. 470 (/). Out of Proportion to State's Services. 
470 (k). Taxation versus Benevolence. 470 (/)• Taxing away 
Business and Benevolence. 470 (m). Characteristic of Mili- 
tarism. 470 (n). Heaviest on Those Least Able to Bear It. 
470 (0). Approved Only as a Necessity. 471- Inheritance- 
taxes. 471 (a). Collateral not Very Objectionable. 471 (6). 
Conclusions. 

Chapter XL. — Inquisitorial Direct Taxes (Continued). .573 

Personal-Pro per iy Tax. 

Sec. 472. Personal-property Taxes. 472 (a). Uncertain of 
Diffusion. 472 (6). Tend to Double Taxation. 472 (c). Ef- 



XXX 



Contents. 



feet on Prosperity. 472 (d). Personal Property Hard to Find 
or Appraise. 472 (e). Views of Authorities and Operation of 
Natural Laws. 472 (f). Showing of Statistics. 472 (^."Pub- 
licity" a Foolish Means toward a Foolish End. 472 (/*). 
"Homogeneity" Fallacy. 472 (t). Effect on Corporations. 
472 (/). Cause of Prejudice. 472 (k). As Affecting Franchise 
and Non-franchise Corporations. 

Chapter XLI. — Obvious Direct Taxes 586 

I. The Realty-Taxes in General. 
Sec. 473. Objections to Realty-taxes. 473 (a). Their His- 
tory. 473 (6). Incidental to High Civilization. 473 (c). Ques- 
tion of Diffusion. 473 (d). Views of Economists. 473 (e). 
Fact versus Theory. 473 (f). Effects on Producers. 473 (g). 
Stimulate Production. 473 (/1). Sure to be Paid, 473 (1). 
and Easy to Assess, 473 m. and Cheapest to Collect. 473 (k). 
All Owners must Always Pay Part of It. 473 (/). Summary 
for and against the Real-estate Tax. 474. Real Estate under 
Poor Government. 475. Opinion of the Fathers. 476. Equal- 
ization. 476 (a). Remedies Proposed. 

II. Varieties of Realty-Taxes. 
477. Realty-tax, Single Tax, Separated Tax. Appropriation- 
tax. 478. The Single Tax. 478 (a). Locke's Theory. 478 (6). 
Walpole's. 478 (c). Diffusion on Different Grades of Property. 
478 (d). Local Option in Taxation. 478 (e). Effect of Single 
Tax Suddenly Imposed. 478 (/). Experience. 479. Separated 
Tax on Land Exclusive of Improvements. 470 (a). Buildings 
Diffuse Taxes More Readily than Land. 479 (0). Nevertheless 
Separated Tax Encourages Improvement. 480. Appropriation- 
tax. 

III. Rental-Value Tax. 

481. Rental-value Tax is on Consumption. 481 (a). Not a 
Real-estate Tax. 481 (b). Not Double Taxation. 481 (c). 
Should be on One Residence Only. 481 (d). Shifting. 

IV. Franchise-Tax. 

482. Has the Characteristics of a Real-estate Tax. 

Chapter XLII. — Double Taxation 608 

Sec. 483. Taxation of Mortgages. 483(a). Mortgage a Debt, 
not a Value, 483 (b) . and Value Alone should be Taxed. 483 (c). 
Mortgagor Generally Pays Tax Indirectly. 483 (d). Mortgage 
not Properly Real Estate. 483 (e). In Different States. 
483 (f)- Letting Mortgagor Pay Mortgagee's Tax. 483 (g). 
Conclusion. 484. Why Tax Mortgages and not Notes? 485. 
Tax All Recorded Liens "at the Source", and Deduct Them 
from Value of Property. 486. Multiplied Taxation, Especially 
bv Excises. 



Contents. 



XXXI 



Chapter XLIII. — Summary and Conclusions on Taxa- 



Sec. 487. Perfect Taxation not for Imperfect People. 488. 
Vampire-taxes Needed Now. 488 (a). The Rental- value Tax 
may Ultimately Replace Them. 489. Inquisition-taxes In- 
tolerable. 490. The Remote Ideal. 490 (a). Nature Pays 
Some Taxes, 490 (6). and can Pay All. 490 (c). A Question- 
able Objection. 490 (d) . The Future of Taxation. 490(e). No 
Hardship to Landowners. 400 (/). Amortization. 490 (g). A 
Boon to the Poor. 490 (/i). How to Include All Citizens. 401. 
Causes of Delay. 491 (a). Ignorance and Self-seeking. 491 (b). 
In the U. S. Constitution. 

Chapter XLIV. — General Summary and Conclusions. . 624 
Sec. 492. General Conclusions regarding the Civic Relations. 
493. The Questions for Experts. 494. Evolution of the Civic 
Relations, 494 (a), and ot u.e.r Problems. 494 (6). Rapid Ac- 
cumulation of Nostrums. 495. The Labor Trust. 496. The 
Labor Question a Real Question for Real Reason. 497. Ag- 



Government. 498. Improve Suffrage. 499 Evolution not All 
Negative. 499 (a). Even the Desire for Wealth Beneficial. 
499 (&}. The Struggle for Existence Ceasing to be a Brute 
Struggle. 499 (c). Wisdom and Sympathy Gaining Control. 
499 (3). They cannot be Forced. 499 (e). Their rlecessary 
Creed. 

Index 633 



TION 



615 




Evolution of Vices in 



ON THE CIVIC RELATIONS. 



PRELIMINARY SURVEY. 

CHAPTER I. 

SOCIETY'S CONTROL OP THE INDIVIDUAL — GOVERNMENT. 

Unless the student has grown up where 
ory * discussion of the civic relations is more 
frequent than in most homes, he is apt, before studying 
them, to regard them as matters of course, just as 
uninstructed persons regard light and air; and to realize 
their importance as little. Such indeed is too often 
the state of mind even of persons who take an interest 
in what usually passes for "politics"; and it can 
hardly be called rare even among those holding political 
office. And yet it is certainly true that to civilized 
men, nearly all that makes life worth living, depends 
upon the civic relations, as much as life itself depends 
upon light and air. 

Virtually all good things must be paid for in effort 
and self-control. This is no more true of the foods 
that the simplest savage must gather, and of the portion 
which he must deny himself at the moment, and lay 
away for a rainy day, than it is true of the benefits 
derived from the civic relations in the most advanced 
communities. 

Not all men have the character voluntarily to per- 



2 



Preliminary Survey. 



form the labors, and impose upon themselves the con- 
2. Social influence trol » called for by their civic responsibili- 
md controli ties: consequently an important element of 
civilization is a set of opinions, usages and institutions 
whose function is to develop and stimulate and control 
men, so as to insure their performance of the duties 
essential to the general well-being. We shall have 
occasion to touch upon nearly all of these opinions, 
usages and institutions, but our space will permit 
detailed attention to but one of them. Before pro- 
ceeding to it, however, we would do well to glance at 
the most important of the others. 
2<a). through th* First among these is the Family, where 
/amity; ^ e c i v [ c relations begin, and where each 

character that is to play its part in them, well or ill, 
gets its direction and much of its development. Civic 
relations begin with, and even before, the child's first 
breath; and do not end until the last pennies of what- 
ever estate he may accumulate, are divided among 
his successors. And yet so unconscious of all the facts 
just indicated, are even many intelligent people, that 
it was lately possible for an eminent, and deservedly 
eminent, authoress, who had been advocating great 
freedom of divorce, when asked: "And how about 
the children?" to answer. "Oh, I had not thought of 
them!" This, however, was before the recent reports 
from city police authorities, notably from those of 
Chicago, gave a most suggestive illustration of the 
importance of the home, in the fact that an astound- 
ingly large proportion of juvenile (and why not adult ?) 
crime and pauperism is found among the children of 
divorced parents. While the home is generally 
recognized as the chief seat of happiness, its immeasur- 
able importance as the very cornerstone of civilized 
life, is seldom thought of — as seldom as the importance ' 
of the state holding it together, in spite of alienation 
and wrong, as long as human nature can reasonably 
be called upon to endure the strain. But a full treat- 
ment of this important and neglected topic cannot 
come within the limits of this treatise. 



§ 2 e] Society s Control of the Individual. 



3 



Neither can that of another topic of almost equal 
2(b). through importance and interest — the effect on 
pubao opinion; civic relations, of general opinion — class 
opinion and public opinion. Class opinion makes the 
heart-wringing question of who a person's associates 
shall be, often depend upon such apparently trivial 
points as the color of a cravat or the handling of a 
table-knife; opinions held in trade-unions extend up 
to such questions as whether a people shall freeze or 
starve, with reason or against reason; public opinion 
is probably a stronger motive than self-respect, in 
making a man keep his clothes brushed; and public 
opinion leads to the payment of more debts, a million 
to one, than the law does. But even the colossal 
influences of opinion on the civic relations, cannot be 
treated here any more fully than can those of the home. 
2(e), through There is a third influence in the civic 
imitation; relations, perhaps as powerful as family 

life and public opinion, which deserves mention, but 
can here be given little more, tho it has lately been 
the subject of volumes. I mean imitation — the ten- 
dency to do the things which others do — things all 
the way from, on the one hand, wearing cravats, and 
in particular circles, particular cravats, up to respecting 
the integrity of each other's throats inside the cravats; 
but on the other hand, leading peaceable people to 
join in lynchings because others do. 
2(d). through The control of the civic relations by 
education; education, is worth mentioning, too, but 
cannot be gone into in detail here, tho it will be 
touched upon more than once later. 

Contenting ourselves, then, with the mere mention of 
those four controllers of the civic relations — the family, 
public opinion, imitation and education, let us proceed 
to a fuller treatment of one which, while it is in some re- 
spects more powerful than any, or even all, of the others, 
is fortunately in many respects much easier to under- 
2(€) , through stand. It is that massing and arranging of 
government. the opinions and powers of the people, called 
the Government. In a very primitive community, the 



4 



Preliminary Survey. 



government may seem to be rather the opinions and 
powers of one strong man; but his strength consist? in 
bringing under his own control, the faculties of all; 
while in advanced communities, and indeed as a test 
of their advance, the control is less in the hands of one 
or a few, and more in the hands of all. 

Our chief topic, then, tho we shall not avoid the 
others indicated, will be the Civic Relations under Gov- 
ernment. 

3. civic Relations Probably the intelligent reader will have 
defined. already noticed a gap in the system of 

exposition: I have been writing very freely about the 
civic relations, without having yet attempted to tell, 
with any precision, what they are. The omission was 
not altogether unintentional. The reader's own mind 
has probably extracted from his previous knowledge, 
and from what has already been said, a notion of them 
that it will now be easy for him to make more precise. 
The word relations requires no definition. The word 
civic is one of a group evolved from the Latin word 
civis — a citizen. All the words in the group relate 
to the consequences of people living together in society, 
and they range in meaning from "city" up to the 
"civility" which city life is supposed to breed. It 
may be asked: Why will not "political relations" do? 
Why do we want the comparatively new-fangled word 
"civic"? One reason is that, other things even, two 
syllables are better than four; a better reason is that, 
tho our fortunate language is often enriched by 
both a Latin and a Greek word for the same thing — 
just as we have "civil" and "civility" and their like, 
from civis ; and 1 ' political ' ' and 4 ' polite ' ' and 1 1 polished " 
and their like, from polis, yet the bottom meanings 
of the words "civic" and "political", or "civil" and 
"polite", are not the same. The fact is that when- 
ever we start with both a Latin and a Greek word 
originally meaning the same thing, we soon get to 
applying them to different things. A boor can be 
civil, but it takes a gentleman — a natural one at 



§5] 



Society s Control of the Individual. 



5 



least, to be polite — polished; politics really means 
the art of civil government, but perhaps more often 
merely the art of obtaining office or spoils, while civic 
really covers all matters affecting a man as a member 
of society, as distinct from purely personal and domestic 
matters: it embraces all that political does, and, in 
addition, law, economics, sanitation, public education, 
public art, and other subjects, all of which it would 
be a stretch of language to include under politics, tho 
politics may touch them ; but government must touch 
them. We will then define "Civic Relations" to 
mean the relations between people living together, 
especially as they are affected by government. Let 
us approach them, then, through government, by 
the way of a few simple illustrations. 
4. Government's If a person going out on a bicycle, 
functions Illustrated, finds the roads rough or dirty, the fault 
is the government's; if somebody knocks the rider 
down and takes away the bicycle, if the victim could 
obtain no redress, the fault would be the govern- 
ment's; if a foreign enemy in time of war, robbed 
him of his machine, the fault would be the government's ; 
if he bought a bicycle from a man who represented it 
as something different from what it was, in case he 
could not peaceably obtain money equal to his damages, 
or make the exchange for one as represented, the fault 
would be the government's; if he sold the bicycle to a 
person with plenty of money, and could not peaceably 
make him pay, the fault would be the government's. 
* Government's These cases, if carefully considered, will 
finctions classified, be found to illustrate the two great 
divisions under which the functions of government 
come — the protection of our rights — as against each 
other and against foreign aggression; and the pro- 
motion of the general convenience, as illustrated in the 
roads and other objects of government care. Some 
writers make a third division — the enforcement of 
contracts — like those for buying and selling the bicycle. 
But that really belongs under the head of the protec- 
tion of rights. 



6 



Preliminary Survey. 



Let us now consider more in detail what is meant by 

5 (a). Protection rights and the protection of rights. Every- 
ofRighu. one nas a right to the safety of his 
person and property, and that people should live up 
to their contracts with him, if he lives up to his with 
them. It is the business of government to protect 
these rights. Of course protecting rights promotes the 
$(b). Promotion general convenience too, but there are far- 
of convenience, ther functions of government, which more 
specifically promote the general convenience. It usu- 
ally lays out the streets and paves and lights them, 
regulates buildings so as to guard against fire and, in 
some European cities, so as to secure a reasonable 
amount of sunlight in the streets, and pleasing archi- 
tectural harmony. Government also often provides 
the machinery for putting out fire; regulates the 
liquor traffic so that a man shall not be tempted to 
drink too much, and abuse his family, and perhaps 
commit murder; shuts up stray animals in the pound 
until their owners get them; looks after water-supply 
and drainage and public health; provides public schools, 
parks, libraries, and sometimes museums; and coins 
money and carries the mails. The difference between 
all those functions for the public convenience, and the 
protection of rights, is that none of those convenien- 
ces are directly in the nature of protecting person and 
property from attack, or punishing for such attack, nor 
yet of forcing people to make good their contracts. 

Taxat ion There is still a third class of functions 
o. ax ion. essen tial to the performance of the other 
two classes, namely: getting the wherewithal — taxation.^* 

These three classes — protecting rights, promoting con- 
venience, and getting the money for so doing, through 
taxation, include all the functions of government. 

6 Someceneral ^ e k ave seen » then, that crime, unful- 
resuits orbad filled contracts, and bad systems of tax- 
Government. ation ( w hi cn are worse things than the 

novice is apt to realize) as well as bad roads, bad 
drainage and resulting disease, bad conflagrations 
wide-spread drunkenness, are all the fault of bad 



§8] 



Society s Control of the Individual. 



7 



government. Now if such things happen very often 
in a place, of course people will not want to buy prop • 
erty there, and so houses and lots will be sold for 
very little. Yet this works both ways: for while 
bad government has often made prosperous places 
deserted and poor, a return to good government has 
often made such places populous and rich. 
7. Responsibility Therefore, in, a free country where 
for bad everybody can vote, if a place suffers 

Government from bad government, it must be the 
fault of the people themselves. But why should people 
suffer from bad government, when their own votes 
make the government? For just the same reason 
that people suffer from poverty and disease — usually 
because they are ignorant, self-indulgent, dishonest 
and lazy ; sometimes, tho comparatively seldom, because 
they are unfortunate. 

Ignorance leads people to suffer from bad 
ment'rwiSres 6 " 1 " government, because government is one of 
d5rtfter C tfid effort t ^ ie most difficult things men undertake, 
' and ignorant people are apt to vote for 
ignorant people to carry it on. They do this not 
only because they do not know any better, but also 
because they prefer to be governed by people of their 
own kind. Ignorant people too often hate to acknowl- 
edge anybody as superior to themselves. It is only as a 
man grows wise, that he grows able to appreciate wis- 
dom in others, especially when it is greater than his own. 

Dishonesty leads people to suffer from bad government, 
because dishonest voters can be bribed, or tempted in 
some other way, to vote for dishonest officers. 

Laziness makes people suffer from bad government, 
because those who know something of what good 
government is, and what capable officers are, are often 
too lazy or too absorbed in their business or pleasure, 
to work to get good government. Many educated 
people do not even vote. Yet we have to work to get 
good government, because there are always many igno- 
rant, dishonest and selfish people working to secure 
bad government True, it is their own government, 



8 



Preliminary Survey. 



[§8 



and they have to suffer with the rest of the community, 
but the dishonest and selfish are, at bottom, stupid. 
A dishonest man, no matter how bright he may be in 
some ways, is always at bottom just what Solomon says 
he is — a fool. This, too, despite the fact that dishonest 
men often get rich and powerful. But frequent as such 
facts are, they are far from being the rule. Many suc- 
cessful dishonest men have plainly shown that they 
were miserable, and it is fair to believe that at bottom 
they generally are. A great artist who had painted 
the portrait of a rich scoundrel, said that the face was 
the most miserable he had ever seen. On the other 
hand, if such people are poor (and dishonest people are 
not apt to get rich) they generally sell their votes, sup* 
posing that the money they get for them, or the favors 
they expect if their friends are put in power, will be 
worth more to them than good government would be. 
Probably if all could be known, it would be found that 
they never estimate correctly. No sensible man would 
think that, any other human thing can help him do the 
best for himself, as much as good government does: 
for government affects almost everything a man does. 
9. Extent of Govern- It decides whether every step he takes and 
ment's Influence, every wheel he rolls, shall go with comfort 
or with difficulty, whether every cent he spends shall 
be spent to good advantage or poor, whether every 
second he lives shall be one of danger or security, and, 
in cities, whether every breath he takes shall be health- 
giving or dangerous. 

9 (a), illustrated So far, we have barely alluded to the 
by Monty. money which is spent by the government. 
But the government affects the worth of all money — 
determines to a great extent how much a man shall 
get for every cent he spends. If a government is honest 
and capable, its expenses will be low in proportion to 
the good it does: so taxes will be low, and taxes enter 
into the cost of everything — a landlord has to pay 
taxes on a store, for instance, and adds them to the rent; 
and so the storekeeper has to add them to the prices 
of the goods sold in the store. Thus prices will be 



§ n] Society's Control of the Individual, 



9 



made high by high taxes, and each man gets less for his 
money. 

Moreover: government manufactures the money, and 
if it manufactures bad money (as ours has done twice 
since i860), a man cannot buy as much as he ought to 
with it. 

GEOGRAPHICAL DIVISIONS OP GOVERNMENT. 

10 Each citizen ^° * ar * we have s P°ken of government 
lives under several as if it were but one organization — as if we 
*°vemments. lived under but one government. But 
Americans generally live under at least four — local, 
county, state and national. How much territory the 
local government covers, mainly depends on the thick- 
ness of the population. In New England and the 
Middle States, the local government generally covers 
a township, but often only a village or a city. In the 
Western and Southern States the local government often 
covers a whole county, or even more. We should note, 
in passing, the most striking differences between a town, 
a city and a village. A village or a city is always a 
collection of buildings; a town (in the American sense, 
not the English) may contain no buildings at all, or only 
scattered ones, or it may contain villages or even cities. 
A city is sometimes called a town, but that is only a 
fashion of speaking, just as men, women and children 
are alluded to as part of mankind. Although Americans 
generally live under at least four governments, they 
sometimes live under more — under both town and vil- 
li. Overlapping! ^ a £ e » or c * tv 9 gp vernment » as we ^ as county, 
of local gov- state and national. Sometimes, too, even 
emments. ^ e school districts of a town attend to 

more of its local affairs than merely those of the school, 
and really constitute additional governments. On the 
other hand, sometimes the whole township is covered by 
a city, and even, in rare cases, it has both a town gov- 
ernment and a city government. Generally, t ho, in such 
cases, the city government replaces the town govern- 
ment. But when the city covers the whole county, as a 



IO 



Preliminary Survey. 



few of our leading cities do, both city and county govern* 
ments generally continue side by side. On the other 
hand, in very thinly populated regions, something like 
the reverse occurs — the county is sometimes the smallest 
political unit, and performs what functions of a local 
government are necessary. Then people live under but 
three governments — county, state and national. 

12. Functions of Ordinarily, local governments do (or 
local government, neglect to do) the laying out of such 
streets and roads as are too short to come under the 
jurisdiction of the wider governments; and do what- 
ever grading, paving, sewering, sidewalking and policing 
the streets and roads may have. They also punish 
such offences and settle such disputes as are too petty 
to come before the wider governments ; regulate building 
and protect against fire; sell licenses for some trades; 
look after the schools and the poor and sick; grant 
permits (in thickly populated regions) for public vehicles ; 
and sometimes supply water, light and other conve- 
niences, or else grant franchises to companies that do 
supply them. 

13. Of County The county is mainly an organization 
government. f or the administration of justice better than 
it could be done by smaller local governments. The 
county generally provides better courts, jails and often 
almshouses and hospitals, than the minor governments 
could afford, and gives all its localities the use of them. 
At the county seat, too, it generally keeps the records of 
the real-estate transfers, and other important documents. 
The county also sees that the longer roads are properly 
laid out and cared for. When a city overgrows the 
county, and there are no little local governments, there 
is still need for all the more elaborate courts, records, 
etc., and the county government is generally kept up 
along with the city government. 

14. Of State gov- Of the state government, some people in 
ernment. the cities are beginning to say that its 
main function is really to enable the country to milk 
the cities — to give country legislators, who are in 
the majority, the chance to lay an undue share of 



§ 1 5] Society's Control of the Individual. 1 1 

the state's taxes onto the cities, and to give them 
also the chance to get bought off (or on) regarding all 
sorts of legislative " strikes" against the cities. What 
the state government professes to do, however, is, in 
regard to justice, something for the counties like what 
the counties do for their small local governments — it 
provides a high and expensive grade of courts to which 
important cases can be taken from all over the state, 
especially cases that are appealed from the lower courts. 
It also provides prisons, and often reformatories and 
insane asylums, better than any that any one county 
could ordinarily support; it regulates the roads and 
railroads that pass through several counties; and what 
is most important of all, it passes laws regulating per- 
sonal rights and property rights over the whole state, 
so that if a man wishes, he can deal safely with a neigh- 
bor who lives, or owns a piece of property, more than a 
mile or two from the place the former lives in, because 
the same law judges for both, if any difficulty arises. 

All the local and county governments can pass only 
such ordinances, and judge only in accordance with 
such laws, as the state government approves — in short, 
the state government controls them. 

Now the state government itself is not, like the 
local and county governments, under the control of 
15. Of Nttlontl an Y higher government, except in the par- 
government, ticulars where it has combined with the 
other states to make the nation. In so doing, 
each state gave up to the nation a carefully specified 
portion of its powers, but reserved all the others. 
There is a pretty distinct line between those given 
up and those reserved. Roughly speaking, there 
are but two fields in which the citizen's rights are 
regulated, not by the state, but by the nation: first, 
so far as his rights are affected by other nations; and 
second, as we shall see more particularly hereafter, so 
far as they come under certain broad principles of 
liberty which the United States is to maintain if any 
state should fail to do so. But these principles have 
become so much matters of course in the Anglo-Saxon 



12 



Preliminary Survey. 



race, that probably there is not one case in a hundred 
where a man's rights are not practically under the 
care of his state rather than of the nation. In the vast 
majority of cases, the state is still sovereign, as it was 
originally — so entirely that the terms "government" 
and 4 ' state " are still interchangeable. 

The expression "roughly speaking" may have been 
noticed in the last paragraph, and it is well worth 
while to realize before we go deeper, that Civics can- 
not be as exact as Mathematics. Our civic relations 
depend on human nature — the most complex and un- 
certain topic we know anything about — and upon 
human nature in many men, at that. So many influ- 
ences are at work, that there are apt to be different 
elements in cases that appear alike; and therefore 
such cases sometimes turn out very differently. But 
investigators have found plenty of principles that are 
true in most cases — but true only "roughly speaking", 
or "by and large". We will generally take the excep- 
tions for granted, however, and not stop too often 
to allude to them. But just here we are met by a 
vfcry important fundamental question, to which the 
best answers yet framed, are found to be "in the 
rough", or "by and large". A few lines back is the 
„, , , _ expression: "the state is still sovereign". 

Now what does sovereign mean? As a 
noun and an adjective, its meanings differ. The king of 
England is a sovereign, and yet he is not sovereign, but 
the people are. The Czar of Russia or "the king of the 
cannibal islands" is both a sovereign and sovereign. 

Our national government, as already said, is sovereign 
over 'the states only in certain particulars carefully 
specified in the Constitution. But through that sover- 
eignty, it makes the United States a great and power- 
ful nation, instead of a group of little states on any 
one of which any petty nation could impose, and 
which would be apt to impose upon one another. To 
prevent that, the national government provides courts 
before which, for instance, "little Rhody" may obtain 
justice in any dispute with big New York ; and it also 



§ 1 6] Society's Control of the Individual. 



13 



regulates commerce between the states. The govern- 
ment of the United States as a great nation, regulates 
our relations of commerce, peace and war, with all 
other nations. Hence it provides custom-houses, and 
army and navy; makes laws regarding naturalization 
of foreigners; and protects our citizens trading or 
traveling in foreign lands. It also guards the coast, 
by lighthouses and harbor improvements as well as 
by ships and forts. Moreover, as it is a great con- 
venience to have the same money, the same weights 
and measures, and the same mails, over all the states, 
the national government provides and regulates them. 
It also secures to inventors and authors the fruits 
of their labors by patent and copyright laws good 
over the whole of the United States, and has arranged 
for like security over most foreign civilized territory. 

DEPARTMENTS OF GOVERNMENT. 

16. Legblttlve, So much for a hasty preliminary sur- 
Judklal, Executive. V ey of our various American governments 
as geographically determined. Now let us take a 
similar glance at their individual make-up. Roughly 
speaking, they have these prominent features in com- 
mon with each other and with all civilized govern- 
ments: — they make laws, decide what laws apply to 
particular situations, and see that those laws are carried 
out. Those three functions are called Legislative, Ju- 
dicial and Executive. 

Now to understand these three functions of govern- 
ment, let us inquire: What is the advantage of having 
rights protected by government? Does not every man 
understand his own rights better than anybody else 
can? Why not leave each man to take care of himself? 
The bottom reason perhaps is in the answer to the 
second of those three questions. So far from it being 
true that every man understands his own rights, it is 
proverbially true that no man is a fit judge in his 
own cause: so one of the most important functions 
of government — a subdivision of its protection of 



14 



Preliminary Survey. 



rights, is providing unprejudiced judges to determine, 
when a man's rights are in dispute, what they really 
are. 

But after courts, with judges and juries, have deter- 
mined what a man's rights are, why not let him go 
for them himself? Because it would depend largely 
on the size of the other man whether he would get 
them, and nearly every lawsuit would end in a fight, 
perhaps a killing, perhaps a long family vendetta. 
They did so quite generally in the first few hundred 
years where we get glimpses of the ways of our Saxon 
and Norman ancestors, and still do in the primitive 
parts of our country, and in primitive countries gen- 
erally. It would be almost as well to have the fighting 
come before the lawsuit as after it, and save the ex- 
pense of the suit. 

To make the machinery for finding judgment of 
much use, there must be machinery for executing it, 
and machinery so powerful that the losing side would 
not think of resisting. In advanced societies, this power 
17. Sources of * s that of the whole community, behind 
Government. the officers of the law. In our*own coun- 
try, the humblest rural constable can call upon every 
citizen at hand, to help him enforce the law. If they 
cannot do it, he can send for all officers within reach, 
with such citizens as they can bring; if the resistance 
is still too strong, he can call upon the governor for 
every militia company in the state; if the resistance is 
too strong for them, the governor can call upon the 
President of the United States for its whole army and 
navy; and if they are not large enough, the government 
can enlarge them until every loyal citizen is in the ranks. 

If not enough citizens are loyal, of course the affair 
would amount to a revolution, and the resisting side 
would overcome the government and set up a new one. 
In fact, when people, like our neighbors in South 
America or our friends in France, get into an uneasy 
state, revolutions sometimes start in that way — in some 
petty quarrel, and spread until the whole state is in- 
volved. But in such cases, the community must already 



§ 1 8] Society's Control of the Individual. 15 

have been in irritated division over the question at 
issue. 

But great as is the need for a judicial department to 
determine rights, and for a strong executive to protect 
them and enforce duties, there is another reason almost 
as good, and in some aspects better, why a strong execu- 
tive is needed. If the executive is strong, there is very 
little protecting or enforcing needed. People come down 
quietly, as the 'coon did when he saw that the man be- 
hind the gun was Davy Crockett; and what is more 
important still, they do not go up — they behave them- 
selves generally, because they know it will not pay to 
do anything else. 

We seem to have found reasons enough for the judicial 
and executive departments of government, but in a 
primitive government, there are not even that many 
departments; the chief, with the men he can get to 
do his will, is the whole establishment; but a govern- 
ment highly organized (or highly differentiated, as 
the philosophers say) is split up not merely into the 
two departments we have already found necessary, but 
also into a third — the legislative, which makes many 
of the laws that the other two departments respectively 
judge under, and execute. A separate legislative 
department is always the last one evolved : for the priests 
always make a judicial department early; but the chief 
ruler — king or whatever he may be, always keeps the 
law-making power in his own hands as long as he can. 
He still holds it in Russia and Turkey. 

Now to illustrate how the three depart- 
d^artmentTliius- ments work, take the man going out on his 

trated In civil and bicycle. He breaks his wheel because of 
criminal suits. ,~ J , r ... j . • 

the roughness of the road, tries to get 

redress, and proceeds to sue somebody. He finds out 

that under laws passed by the state legislature, it was 

the duty of the men owning on the sides of that particular 

road, to keep it in order: that is step first — a law has 

been passed. Now it needs to be applied to the case: 

our bicyclist goes to the man owning on the side of the 

road where the damage was done, and the man says : "I 



i6 



Preliminary Survey. [§ 18 



don't take care of one side of the road. My opposite 
neighbor and I agreed to divide it lengthwise. We 
take fifty yards apiece. Your accident occurred on 
his fifty yards." But the neighbor says: 4 1 Nonsense: 
the accident did not occur on my portion of the road: 
I won't pay/ Then the bicyclist may have to go to 
court to see which man is responsible. That is step 
^second — determining how the law fits the case. When 
'the judge, after hearing all the evidence, determines 
that point, he may decree that one man or the other 
owes the bicyclist ten dollars. Then comes in the third 
step — executing the law: if the man does not pay, the 
sheriff comes in and sells some of his property, and pays 
the bicyclist out of the proceeds; and so are finished up 
the three general functions of government — providing 
the law, fitting it to a case, and enforcing it. Such a 
suit, when nobody is on trial for a crime, is called 
a civil suit. 

Now to illustrate a criminal trial: Somebody knocks 
the bicyclist down, and takes his wheel. The state 
government has provided laws (step first) punishing 
violence and robbery. The local government has a 
policeman or constable to arrest the offender; it has 
also a magistrate to determine what laws he has violated, 
and whether the punishment they decree is one of the 
slight ones that a local magistrate can inflict, or whether 
his case is so serious that it must be tried in a more 
important county court. After the offender is tried 
in one or the other, and the law in his particular case 
is declared (step second) and his punishment is decreed, 
the third step is taken — the law is executed — the local 
policeman locks him in the station-house for a day or 
two, or the county sheriff takes him to jail for perhaps 
a month, or the state officer receives him into the 
penitentiary for a longer period. 

In America, the town government, or 
dfclaVand^iwutr^ sometimes the county, is generally first 
fu ov C ernment. local evolved. Either of them starts in a 
governmen . mere collection of farms. At first, all the 
voters get together to legislate; they also select a magis- 



§ 2o] Society* s Control of the Individual. 



17 



trate to judge in disputes and crimes, and a board of 
"selectmen " (generally three), and perhaps a constable, 
to execute or administer the laws. 

As population increases, so many questions arise 
that people generally cannot come together often 
enough to settle them all. Moreover, when there are 
very many people, they cannot hear each other speak, 
and cannot readily count the votes. Under such cir- 
cumstances, they usually divide up into smaller bodies, 
each of which elects one man to represent it in a gather- 
ing of all the representatives, and there to decide 
matters of government for all the people. Thus a 
village generally legislates through a representative 
board of trustees, who pass ordinances about the 
streets, bridges, local health, etc., but they must do 
this in accordance with general laws laid down by 
the state legislature. A village also has its own magis- 
trates to judge under the state laws determining per- 
sonal and property rights: thus they settle petty 
quarrels and punish petty offences, or send the offenders 
to higher county or state courts. The village also 
has an executive or administrative head (the terms execu- 
tive and administrative are interchangeable), in the 
president of the board of trustees, who is assisted by 
commissioners for streets, fires, health, etc., to execute 
the ordinances of the board of trustees (legislative de- 
partment), and the president is also helped by police- 
men or constables to execute the decrees of the magis- 
trates (judicial department). 

A city government is generally composed of legis- 
lative bodies (known in different places as aldermen, 
councilmen, etc.) — sometimes of two chambers, to 
pass laws regarding local matters; of judicial courts 
as well — not only those of the magistrates, but addi- 
tional ones of a higher grade; and a mayor with a 
considerable body of assistants to see that the laws 
are executed, 

20. The functions The counties do not have any law- 
ln Counties. making assemblies for the direct purpose 
of legislation, tho the bodies known as Supervisors 



1 8 Preliminary Survey. [§ 20 

or Commissioners really have considerable legisla- 
tive power over taxes, roads, care of the poor, etc. 
Generally speaking, however, outside of these officers, 
county governments are, as said before, merely organi- 
zations for the administration of justice. They have 
no law-making body, but only two sets of function- 
aries — the judicial, consisting of judges of courts and 
their assistants, to apply the laws which the state 
legislature makes, and to record legal documents; 
and also twofold executive bodies: first, the sheriff 
and his assistants, to carry out the law after the courts 
declare what it requires in each case; and second, 
commissioners to care for the roads, court-houses and 
other county buildings. 

The state government has the " full 
flons^StatM^ 1 " " kit" — legislative, judicial and executive. 
ons ' The legislature generally (universally, so 
far as I know) consists of two bodies, both of which 
have to concur to pass a law: their laws provide 
for the care of person and property over the whole 
state, and are applied by local magistrates, city courts, 
and county courts. Then the state has its judicial 
bodies — the state courts, which generally hear cases 
appealed from the county courts, and also determine 
whether laws passed by the legislature are according 
to the agreement of the people under which the state 
was primarily organized (generally called the Consti- 
tution, 79 *) ; and the state has also its executive 
body — the governor and his various assistants, who 
see that the general laws passed by the legislature, 
and the particular applications of them determined 
by the judiciary, are executed. Some state govern- 
ments can remove local officers who fail in this regard. 
22 The same ^e United States government has the 

functions in the same general tripartite organization that 
Nation. t ^ e jninoj. governments have — the legis- 

lative body, consisting of two houses of congress; the 
judicial body, consisting of United States courts 



* The cross-references indicate numbered sections, not pages. 



§ 22] Society's Control of the Individual. 19 

scattered all over the country, and a supreme court 
at Washington to try appeals from them; and finally 
an executive body to carry out the laws and the deci- 
sions of the courts. This executive body consists of 
the president; his cabinet; all the national civil ser- 
vice in the departments at Washington, in the mints, 
custom-houses and post-offices, all over the country; 
the army and navy; the lighthouse and coast life- 
saving service; and many other divisions. 



BOOK I. 



THE PROTECTION OF RIGHTS 



CHAPTER II. 

OP RIGHTS IN GENERAL. 

Of the three general functions of government — pro- 
tecting rights (including protecting them against a 
foreign enemy), promoting convenience, and taxing 
for its own maintenance, protecting rights was evolved 
first, because, in early societies, before some progress 
has been made in civilization, there are no conveni- 
ences to promote. A result, then, on the body of 
Law and Political Science evolved even up to our 
day, is that it deals mainly with rights. The functions 
of government in promoting the public convenience 
have been evolved so late in comparison, that they 
are not nearly so clearly understood; in fact, com- 
paratively little attention was paid to them before 
the middle of the nineteenth century. 
23. Righti Impose First, then, to take the greater field — that 
duties. of rights, let us try to understand the in- 

teresting fact that all rights impose duties — duties on 
others, and also duties on oneself. They impose duties 
on others, because a right is, of course, a power justly to 
demand that somebody shall do something or refrain 
from doing something; and this doing or refraining 
on the part of somebody, in response to a right de- 
manded, is of course a duty. 

ax 



22 



The Protection of Rights. 



Whether the demand and consequent obligation are 
just, is determined by "the greatest good 

24. "Greatest hap- of the greatest number". What that is, 
njness " principle . , , ° , k . . „ f 

and its application is declared not only m all rehgions, but 
in thethne kinds by the gen e r ai experience of mankind. 

But the religions differ, and so do the 
opinions of mankind. Who, then, shall judge? 
Each nation has its own dominant religion and domi- 
nant opinions. In proportion to the advance of a 
nation, its opinions, religious and secular (which gener- 
ally correspond pretty closely), are embodied in cus- 
toms and laws. Of course men's convictions of right 
must be matured before laws are made to enforce 
them: so there are always moral rights acknowledged 
by good men, which have not yet become legal rights. 
As fast as legal rights are established, priests and 
judges apply them to the cases that come before them, 
being guided, in very advanced races, by a body of 
Law made up, (first) of recorded opinions and enact- 
ments that have been applied to similar cases, and 
piecing out such opinions to fit new cases. The body 
of these opinions is called with us the common law; 
(second) of statutes passed by law-making bodies, called 
statute law; and (third) of decisions and practices 
(like those of the treasury, the custom-house, and the 
post-office) arising in the course of executing the laws. 
The body of these last is called the administrative 
law. Thus rights and duties are declared and enlarged, 
and the power of the whole society, directed by the 
government, is exerted to defend the rights and enforce 
the duties. 

Yet priests, judges, legislators and rulers are human, 
and the system and its workings are hampered by 
human imperfections. They have improved immensely, 
however, in recorded history, and, taking the race 
by and large, are improving every day. The plain 
way of improving them faster among us, is by improving 
each man's sense of civic duty — so he will follow only 
wise priests, and vote for only good judges, legislators 
and rulers — if that is a "plain way". If such persons 



5*6] 



Of Rights in General. 



23 



were always in authority, they would keep legal rights 
closer up to the best convictions of moral rights. 
25 Ri htsand One's rights impose duties not only on 
duties Snpiy each others, but also on oneself , because a man 
other ' cannot justly expect other people to 

grant his rights unless he grants theirs. He can assert 
a right to life or property, for instance, only as he 
performs the duty of granting other people their rights 
to life and property. Why a man's rights are measured 
by his duties, we do not know, any more than we know 
why two and two make four. It is a law of Nature, 
proved by all human experience. Justice must be 
reciprocal — must be even to both sides: the goddess 
holds the scales. The statements of that law that 
have most influenced the civilized world are, 44 Do 
unto others as you would they should do unto you", 
and "Forgive us our trespasses as we forgive those 
who trespass against us." 

26. RJghti The rights for which our fathers de- 

classified, manded government protection, were 

summed up in the Declaration of Independence, as 
the rights to Life, Liberty and the Pursuit of Happi- 
ness. There might easily be a worse classification. 
But classification suggests the idea of scientific treat- 
ment. Now as these rights seem to spread everywhere, 
and yet as you cannot touch or see them, as you can 
a plant or an animal or a star, the idea of giving 
them any scientific treatment may seem impracticable 
to readers who have associated science only with tan- 
gible and visible things. Yet what we know about 
them can be given scientific arrangement, and that 
is all we can give to what we know of any subject. As 
to "scientific precision", however, of course we can 
know some things more precisely than we can others — 
simple things more precisely than complex things — 
things of sense more precisely than affairs of thought 
and feeling. For instance: the most precise science 
of all — mathematics, deals with the simplest things, 
mere quantity and position, without any reference 



24 



The Protection of Rights. 



whatever to the infinite number of conditions which, 
for instance, make the difference between a human 
being and a stone of the same shape. Again, as a 
stone is simpler than a plant, we have a more pre- 
cise science of stones than of plants; and for the same 
reasons, of plants than of animals; of the lower ani- 
mals than of the higher; of the animal's body more 
than of his mind; and of the individual animal's 
mind more than of the interplay of a number of minds. 
So we have got to be content with less precision, and 
consequently more difference of opinion, in studying 
the interplay of men's souls — their social relations, 
than in studying almost anything else. Yet we can 
make a science of them, as I said before, precisely 
as we make a science of anything else, by getting 
what knowledge we can, classifying it as best we can, 
and using our system to help us to more knowledge. 

To begin, then: Rights are usually first classified for 
scientific treatment into Rights regarding Persons 
and Rights regarding Things. At first sight, the 
Declaration of Independence hardly followed that 
classification, but it virtually did: for the rights to 
Life and Liberty are plainly rights regarding Persons — 
as against attacks from them, and as embracing duties 
toward them; and under the rights to the Pursuit of 
Happiness, we can easily treat separately those re- 
lating to persons, and those relating to things. 

Personal rights are sometimes regarded as rights 
affecting one's own person, as distinct from rights 
affecting one's property. The classifications cross in 
some particulars, as nearly all classifications do; but 
while, in this case, one may be no better than the 
other, we may as well follow the lines laid down by 
our fathers. 



CHAPTER III. 



RIGHT TO LIFE. 

27. The Stated The right to life seems too plain to 
d* 1 ™' discuss, and yet the state need not always 
preserve its citizens' lives, but on the contrary, it 
often demands them — by thousands at a time, in 
war for its own defence, and even (rightly or wrongly) 
for its own extension. But even then, it is the state's 
duty to guard the lives as well as circumstances per- 
mit — to give its soldiers the best possible care: — to 
give them such officers, surgeons, arms, food, and 
attention of every kind as will bring their lives through 
war if it is a possible thing. 

The state also demands life in other ways than in 
war. Under the laws of most states, a citizen for- 
feits his right to his life when he does not perform the 
duty on which that right rests. If he neglects that 
duty, and kills somebody else, his right not to be killed 
is gone, and the state may kill him if it sees fit. 

28. Humanity's A man has not always a right to his 
clalms » life, even outside of the state's demands 
on it in war or for justice: it is often a man's duty 
to risk it for those he loves, and in helping others in 
danger of their lives; and not only soldiers, but doc- 
tors, chemists, miners, engineers and many others, 

29. Professional must risk their lives to do their mere 
dalms. duty in the professions they have chosen. 
They cannot turn back from danger when other peo- 
ple's lives are in their hands. The time to turn back is 
before adopting one of the heroic professions — before 



26 



TJte Protection of Rights. 



subordinating their rights to life, to their strenuous 
duties. 

In some countries, Nature, unaided by 

30. Life and work. the e ff orts f men> supplies the essen- 
tials of life, and even the young reader need hardly 
be reminded that in such countries Nature is an over- 
indulgent parent, who spoils her children, and does 
not lead them to civilization. Civilization comes 
from work, and no country has ever become civilized, 
and therefore (on the very strongest ground we have 
for any expectation) no country ever can become 
civilized, where life itself does not depend on work, 
and where the right to life does not depend upon the 
right to work; and where, accordingly, the right to 
work is, to all but those dependent on others, of as 
much importance as the right to life. 

31. The Right And yet by one of those strange and 
to Work. instructive paradoxes which the thought- 
ful observer is continually noticing, in the countries 
where the right to life is most effectively guarded, the 
right to work is most generally attacked. One of 
the instructions in this paradox is that, as intelli- 
gence and the effectiveness of law advance,the absurdity, 
not to say the criminality, of attacking the right to 
work, advances with them. This may help us esti- 
mate the reasonableness and morality of both the 
American trade-union's claim that if a man will not 
join it, it can properly interfere with his right to work; 
and its practice, if he does not obey its demands, of 
burning his house and taking his life. 

But it has just been seen that the community has a 
right to a man's work, even in the most dangerous of all 

pursuits — in war, and even to his life itself, 
lnlyto 8 tht J s^ate. wnen tne state requires either or both for 

the greatest good of the greatest number. 
The trade-union justifies its claim on the same ground — 
the greatest good of the greatest number. In doing 
this, as the intelligent reader has probably realized, it 
simply performs the saltum of assuming itself to be 



§3i a] 



Right to Life. 



27 



"the greatest number'' — the state itself, or really, as 
it often assumes, the superior of the state — a saltum 
which we see it repeating in some connection every day. 

Any trade-union is a ridiculously insignificant por- 
tion of the state, all of the trade-unionists put together 
with their wives and children, are less than an eighth 
of the state, and what they may think for their great- 
est good, may be for anything but "the greatest good of 
the greatest number ", as they are constantly demonstra- 
ting by stopping the transit and supplies of the greatest 
number, and filling the streets of the greatest number 
with riot, arson, bloodshed and murder. 

Probably every war has been based on some similar 
perversion of logic. Over this one, here and there in 
America, civil war has been for some time cropping 
out in little skirmishes between unionists and their 
attendant hoodlums on one side, and the militia — 
sometimes even the army — on the other; and there 
are sober judges who look for an increase of it. Even 
the greatest philosopher of our time — and perhaps 
of any time, as he had more experience behind him 
than any previous philosopher — thought that the 
fallacy we have been treating, and the others vaguely 
grouped with it under various vague names (one of 
which vague names is socialism), will eventually pre- 
vail in their chronic war with intelligence; that the 
victory will be the greatest disaster so far experienced 
by mankind ; and that the first step toward recovery 
will be military despotism. But Spencer's unsurpassed, 
perhaps unequalled, greatness, was in the impartial 
grouping of passionless facts — a purely intellectual 
process, where there was little room for the bias of 
temperament. This pessimistic prophecy of his, on 
the other hand, tho it dealt with a relatively small 
group of facts, found every one of them hot with con- 
troversy; and the interpretation of them was that 
of an old and lonely man whose attitude toward life 
had never had the hope-giving influence of children. 
It is not inconsistent therefore with the profoundest 
loyalty toward his philosophy, to take a more hopeful 



28 



The Protection of Rights. 



[§3i<* 



view than he did regarding this passion-laden and 
(compared with his cosmic generalizations) minor 
question, and to find much hope in the already visible 
effects of very recent counter-organization and appeal 
to the courts. 

31 (b). picketing The courts try to guard the Right to 
and Boycotting. Work, as they guard any other right. 
They are now attacking both picketing and boy- 
cotting, but there are thousands of ways of making 
a man's life uncomfortable, and so interfering with 
his liberty, that the law cannot take hold of. 

If the people on whom a man depends for business 
or companionship, conclude merely not to have any- 
thing to do with him, it is pretty difficult for the govern- 
ment to force them to. A marked case was in 1899, 
when the workmen in Worcester, Mass., would not 
go to see the local baseball club play, unless it dis- 
charged a man who years before had refused to join 
in a labor strike. The courts could hardly force people 
to go to see baseball. Yet the law has done much, as 
will appear later. 

A workingman can avoid all this trouble by joining 
the trade-union and sticking by it, but if he is not free 
to join or not, as he pleases, he has no liberty. It 
Is as much government's duty to protect him in this 
liberty as in any other. 

32. Duties condi- ^! eo J er ^ T w , hen £ a man claims the 
tlonlng the Right Right to Work, of course he confesses 
to Work. certain duties. The most obvious of 

these are not to interfere with any other man's Right 
to Work; and to do his own work honestly. Under 
the first head, the effort to force men to stand idle 
when others strike, is not only an attack on others' 
Right to Work, in the very act of asserting the same 
right for oneself; but what is more ridiculous, if pos- 
sible, it is an assertion that the strike on hand has 
not justification enough to stand by itself, without 
being held up by force. 

The other duty of a man claiming the Right to 



534] 



Right to Life. 



29 



Work, was said to be to work honestly. In asserting 
that right, he confesses this duty not only to his em- 
ployer, but also to society, because he calls upon society 
to protect him in his Right to Work. Society, which 
buys the laborer's product, really pays him his wages, 
and has a right to its money's worth. 

33 Society's Beyond society's duty to protect the 
alleged Duty to Right to Work from interference, it has 
Provide Work. been cla i me( i that society shall find work 
for anybody needing it. But there is a vital difference 
in the two things — to protect a man from being inter- 
fered with in seeking honest work, is to secure him his 
right to pursue his own happiness; while for society 
to find work for him, is to take a share of the pursuit 
of his happiness upon itself. 

A more detailed treatment of this whole subject, 
will be given in a later special chapter on Labor Coer- 
cion, and in one on Labor and the Law. 

Universal experience has shown that if government 
attempts to do any more for people's work than to 
see that they are not interfered with, people get to 
depending upon government instead of upon them- 
selves, become shiftless and lazy, and ultimately expect 
government to feed and clothe them and do every- 
thing else for them, without their doing any work. 

34 The English Probably the most conspicuous demon- 
Poor Law and the strations of this were the working of the 
French workshops. English Poor Law in the eighteenth cen- 
tury, and of the French public workshops established 
after the revolution of 1848. 

The Poor Law of 1782 required the guardians of the 
poor to find work for everybody who did not find it 
for himself, and to support him until they did. It 
set the lazy all over the country to living at the ex- 
pense of the industrious, and to raising large families 
to get the benefit of the government dole for those 
who were too young to work. In 1834, England had 
to return to the old system of supporting only those 
who were willing to live in the workhouses, and then 



3° 



The Protection of Rights. 



[§34 



people generally became able to find themselves work, 
and the birth-rate among the useless classes diminished. 

A person receiving relief from the state was dis- 
franchised. When this book goes to press in 1907, 
bills are pending with every prospect of passage — per- 
haps some have been passed — to give meals to school 
children without disfranchising their fathers. Old-age 
pensions are expected next. The extension of the 
suffrage since the repeal of the Poor Law, has inclined 
politicians to curry favor with the poor, and similar 
"relief" will probably be extended until new repeals 
will be found necessary. 

The experience in the French workshops was that 
men would not hunt for work elsewhere, but flocked 
to them; other industries became disorganized; the 
officials could not turn away a man who claimed from 
the state the Right to Work; shops were filled faster 
than they could be built; but as the laborers felt sure 
of their places, they worked carelessly, and soon the 
whole thing had to be given up. 

An attempt has been made to insure people against 
loss of work. But even that is risky. When Germany 
forced its railroad employees to insure themselves even 
against accident, they became careless, and slow to 
return to work after being laid up. 

The moral of all this is that there is no way of super- 
seding Nature's method of advancing man, which is by 
forcing him to depend upon himself. Every effort to 
relieve him of that responsibility has led to his deterio- 
ration. 

But human arrangements are not per- 
35. Public Charity. fect There often come times of business 

depression, when many deserving people who are per- 
fectly willing to work, can find nothing to do. But 
that is a question of an occasional emergency, and 
notof the usual state of affairs ; and it is more a ques- 
tion of public charity than of public justice. Public 
charity should be reserved for only grave emergencies, 
otherwise it does more harm than good. This is 
illustrated by the experience with public kitchens, 



§35] 



Right to Life. 



3i 



soup-houses, and methods of relief of all kinds that 
have been thrown open to all comers. Unless such 
help has been restricted to those whom careful inves- 
tigation proves unable, for the time, to take care of 
themselves, it has spread idleness and beggary among 
people perfectly able to provide for themselves if 
obliged to. That has always been the case, tho it has 
sometimes appeared otherwise: for instance, after the 
great period of enforced idleness of '97, there was a 
very encouraging evidence that of late years people 
have been growing in self-reliance. When the unem- 
ployed began to get work again, at least one of the 
free-food depots was shut up because nobody applied. 
Whether it was a less attractive place than the others 
does not appear. But it was opened in an emergency, 
understood to be only for an emergency, and sup- 
ported only by voluntary private contributions ; there- 
fore people did not depend on it as they did on the 
French workshops. 



CHAPTER IV. 



LIBERTY. 

The right to life, with its concomitant right to work, 
in a sense belongs under rights to liberty. But the first 
two are so fundamental as to justify being in a class 
by themselves: they can exist in the absence of all 
other rights, while in the absence of them, no other 
rights can exist. 

36 Boundaries There are many definitions of liberty, as 
of Liberty. of most other important things. Probably 

as good a one as any, is absence of restraint in the exer- 
cise of one's rights. This of course cannot mean free- 
dom to do as one pleases : for no man is at liberty to 
do- as he pleases, if it interferes with another man's 
right to do any innocent thing that he pleases. Let us 
take some illustrative cases. If I should please to stop 
a man striking a woman, I would have a right to do it, 
altho it would interfere with his doing as he pleased: 
for his doing as he pleased in that way, would be inter- 
fering with her doing as she pleased — with her enjoying 
freedom from pain and injury. If she were his 
wife, and were wasting his substance, she would be 
- interfering with his doing as he pleased with his money. 
But if she were a hard-working woman, and he pleased 
to waste the money, he would be interfering with Iter 
right to do as she pleased with it. But how could 
they each have a right to do what they pleased with 
it, when each might want to do something different 
from the other? Each would have the right, but it 
would be limited, as was said a moment ago, by the 

32 



§37] 



Liberty. 



33 



other's right. To determine how people are to 
settle their rights when they conflict in this way, is 
one of the things that the state is for; but if people 
cannot settle their rights by themselves or with the 
help of their friends, they should resort to law, not 
to fisticuffs. 

When people are living together, then, it seems as 
if the liberty of each must be somewhat curtailed 
by the rights of the others. This is by no means 
restricted to husband and wife: all people Jjving near 
enough to affect each other, must have their liberty 
somewhat limited by the rights of the others. A 
37 Barbarian man uv * n g a l° n e in a forest would be at 
Liberty and civilized liberty to shout and sing and fire his gun 
Liberty. at anv ^ me Q f n ight f and shoot in any 

direction. But if he were living in a community, such 
conduct would very properly send him to the lockup. 
Under proper conditions, however, one can shout and 
sing or fire a gun in the city. 

The name given to the conditions that limit the 
exercise of rights, is duties, as already said. If a man 
claims the liberty to shout, sing and fire a gun in 
the city, he has the duties of doing it only at proper 
times and places — ordinarily in enclosed buildings, 
or on occasions rightly or wrongly considered proper, 
like the Fourth of July, and in places where every- 
body agrees to make a noise. If he claims the 
right, he admits the duties limiting it. A man's right 
to enjoy himself admits the right of others to enjoy 
themselves, and confesses the duty of enjoying him- 
self so as not to interfere with their enjoying themselves. 

If a man claims the right to make a noise and fire 
his gun in the wilderness, if nobody else is there, duties 
do not enter into the case, because there is nobody to 
claim them. But if there is anybody else there to 
make the claim, there arises the duty of not disturbing 
him or shooting in his direction. 

Social duties arise, then, from men living together 
in societies, and it pays to limit their rights by living 
together in societies, because they gain vastly wider 



34 The Protection of Rights. [§37 

and better rights — they can do many things together 
that they cannot do separately, and because there 
has been evolved from this habit of living together, a 
happiness in sociability itself. 

When, then, a man calls upon the 
,, ri D htfto b Libert P ower °f soc iety to protect his liberty, 
l g * ° • y *he confesses two duties to society — that 
r r not interfering with the liberty of others, and that 
of helping to protect the liberty of others, just as he 
claims that others shall protect his. If he is called 
upon, he must act as an officer (17) or, as but few men 
are needed as officers, it is his duty to vote for proper 
officers, honestly to pay his share of the expenses, and 
to inform himself so that he can take the right side 
in all social matters. His faithfulness in performing 
the duties government requires of him, measures his 
right to the liberty and the other rights and the con- 
veniences which government provides him. 

We have seen, then, that we get the advantages of 
civilization at the expense of some of the rude liberties 
of the savage, and it is easy to see that the state 
has the same right to restrain these liberties that we 
have seen it has to demand life itself whenever the 
greatest good of the greatest number requires it. Not 
only must the insane and the criminal be restrained, 
but the noisy, the indecent, the filthy and those other- 
wise disagreeable, must be kept within bounds. 

And liberty needs protection not merely 
wtrlh Ubert^ 1 10 a £ amst tne corrupt, foolish and dis- 
agreeable : sometimes in war, insurrection 
and riot, the rights of good and wise men have to be 
infringed upon, even by men as good and wise as Lin- 
coln: for, tho every accused man has a right to a 
trial, when people may be bearing arms against the 
government, there is often no time to wait for trials; 
and moreover, even in a free country at peace, a 
majority is apt to impose on a minority or an indi- 
vidual. Therefore it is well always to be sufficiently 
alive to political rights to guard against the slightest 
infringements. Like "the rift in the lute," infringe- 



Liberty. 



35 



ments tend to grow. There is reason for the proverb 
40 "Eternal vldl- tnat " Eternal vigilance is the price of 
ance." liberty" (8). 

But what is to determine when the state shall invade 
the citizen's rights? Who is to judge, when rulers or 
majorities are under temptation? Those are big ques- 
tions, and cover most of the art of government. Most 
of this book is to be taken up with them, and so are 
thousands of other books. 

41. Constitutional In the Constitution (79) of the United 
defences States, strangely enough, very little was 

Bill of Rights. originally said about liberty. It seems to 
have been the feeling of the framers that the principles 
of political liberty had been so firmly rooted in the 
Anglo-Saxon race that it was not worth while to write 
down many of them. But when the States were called 
upon to ratify the Constitution, they thought differently, 
and asked that certain other bases of political liberty 
which the race had been working out for over a thou- 
sand years, and which all the States then had in 
their own constitutions, should be written down. Con- 
sequently we have them in the first nine articles of 
the amendments, generally called the Bill of Rights. 
That name was first given to an English statute en- 
acted after the revolution of 1688, and ever since has 
been a favorite term for constitutional provisions to 
protect the individual against the government. 

The principal items in our "bill of rights" are (in 
the Constitution itself *) provision against arbitrary 
imprisonment, bills of attainder, ex post facto laws, 
unequal taxation, misuse of public funds, and- cor- 
ruption of public officers by giving titles of nobility 
at home or abroad, or by bribery abroad; alsof against 
wholesale charges of treason, and corruption of blood 
for it. The first eight amendments provide for free 
religion, free speech, free assembly, free locomotion, 
publicity of all government proceedings, prompt and 
fair trial by jury, the right to bear arms, and freedom 
from excessive bails and fines. 



♦ Art. I, See. IX. 



t Art, III. Sec. III. 



36 



The Protection of Rights. 



[§4i 



Many of these rights are so well understood by every 
American, and some of them can be so much better 
treated later, that we need consider only part of them 
here. 

A bill of attainder is a mere resolution by a legislative 
body, such as congress or a state legislature or the 
British parliament, to convict of crime, without trial. 
This was a favorite means of tyranny in the days of 
religious persecution. Our Constitution provides that 
every person accused of a crime is entitled to a full 
trial in a court, by jury, and with witnesses that he 
can cross-question and contradict face to face. 

An ex post facto law is a law imposing or increasing 
criminal penalties, or changing the evidence required 
for conviction, for acts that were committed before the 
law was passed. Laws imposing such penalties should 
take effect only upon acts committed after their passage. 

Free speech, which includes a free press, is necessary 
to liberty, because a government whose acts cannot 
be proclaimed and criticised, can easily impose on 
people. One of the first things tyrants attempt, is to 
muzzle the press; and even in our country, offices have 
been given to editors, which of course limits their ten- 
dency to criticise the party in power. In political 
meetings, the majority sometimes refuses reasonable 
attention to the opinions of the minority, or the rowdy 
element dominates the peaceful element, and sometimes 
drives them out ; even minorities have sometimes made 
trouble enough to break up meetings. 

The right of free assembly is necessary to liberty, 
principally because if people could not meet to pro- 
test against a bad government, every government 
would tend to become bad, and it could do as it pleased 
and hold on forever. Tyrants are all the time breaking 
up meetings, and bad men often do so even in free 
countries. 

The right to bear arms would naturally be one of 
the first rights a tyrant would try to suppress. It is 
not opposed, of course, by the laws in many of our 
states against carrying concealed weapons. 



§4*] 



Liberty. 



37 



Publicity of all government proceedings secures having 
all laws debated and passed in public, so that the 
people may know the reasons for and against, and 
bring their opinion and the influence of the press to 
bear on the law-makers; and may also know which 
men vote for good laws, and which for bad. In courts, 
publicity is perhaps even more necessary than in legis- 
latures. There is no guarantee that a secret trial will 
be fair, or a secret arrest justifiable. All the stories 
of tyrannous times are full of secrecy. 

Promptness of trial needs to be secured, because 
tyrants nearly always delay trials, if they grant them 
at all, and keep their victims lying in prison. True, 
accused people sometimes try to put off their own trials, 
but if they do, with decent courts, it is a strong sign that 
they are guilty. An innocent man can almost always 
prove his innocence promptly if he is free to call witnesses. 

In our country, the great security against illegal 
confinement, is the writ of Habeas Corpus. The words 
mean: "thou shalt take the person" (or, more strictly, 
"the body"), and they are the first words of a writ or 
writing or order that any judge is bound to issue, on 
proper application, requiring those who have the cus- 
tody of any untried prisoner to "take" his "person" 
promptly into open court to ascertain if he be legally 
held. It may be questioned whether it is worth while 
for us to consider such matters — whether we have in 
America any tyrants to keep in prison any person 
without proving charges against him. But we have 
more tyrants than we always realize. 

Sometimes a majority is the w r orst pos- 
a 2 punl ,e man w,th s ^ e tyrant; and in this case, we have 
the "man with a pull." In one of the 
bad wards of New York, for instance, such a man is 
said to have got the police to arrest, and the magis- 
trates to jail, almost anybody he pleased; tho of course 
he could not "please" like Richard III. and Henry VIII. 
to attack prominent people. He is also said to have 
got almost anybody he pleased, 'let off by the police 
and magistrates. We can defend our liberties against 



3« 



The Protection of Rights. 



[§42 



such people only by making government positions de- 
pend upon character and intelligence — so that there 
will not be corrupt police and judges. 

43. Freedom of * n America it hardly seems worth while 
Opinion. to speak of freedom of opinion, because 
religious liberty is so well protected, but are we after 
all free from attack on our liberty of opinion? A man's 
neighbors are always exerting a silent pressure to make 
him think and live in their way ; and laws favoring one 
set of private opinions and industries, rather than 
another, are constantly passed without people noticing 
them or realizing their bearings. Such are laws dis- 

44. Laws threaten- tributing charities or school funds with 
Ing Liberty. reference to religious opinions, laws mak- 
ing it easier to select from one political party than 
from others, the public clerks and laborers with whose 
work political opinion has nothing to do; and laws 
favoring one kind of industry at the expense of others. 
In such laws the danger of tyranny is greater than in open 
attack on life, liberty and property, because open attack 
would be understood and resisted by the whole community. 

And yet there is wide agitation for laws to interfere 
still farther with personal liberty. Some people want 
laws to say how many hours a day a man shall work; 
what wages he shall receive, whether earned or riot; 
how much he shall lay up and accumulate; and even 
who shall have charge of factories and stores. The 
objection to government thus managing labor, is that 
Nature manages it vastly better. For government to 
manage it, would take away the test of capacity to 
manage, and substitute the test of capacity to get 
office — so that a man might be born to develop great 
industries and find employment for thousands of his 
less capable fellows, and yet be denied the chance unless 
he were master of the arts of the politician; while the 
ordinary politicians would be attempting the tasks of 
the great captains of industry, and not have the ability 
to carry them out. 



CHAPTER V. 



THE PURSUIT OP HAPPINESS. 

Now let us consider the third right claimed in the 
Declaration of Independence — the right to 4 4 The Pur- 
suit of Happiness.' ' 

That right of course involves the rights to Life, to 
Work and to Liberty: the best classifications will over- 
lap. 

But really what the fathers called the 
for mtny , ri3ite! rm right to tne pursuit of happiness, is a gen- 
eral name for innumerable special rights. 
Perhaps we can feel our way to a scientific arrange- 
ment of them, easier than we can lay it down at the 
start, as the rights to political liberty were laid down 
in the Constitution. To make a very simple begin- 
ning: have you a right to pursue happiness into your 
neighbor's watermelon patch? Certainly not. You 
must pursue happiness under some restric- 
m^Vi5MB T v«r d " M ti° ns » tnen » u ^ e the restrictions on liberty. 

' Each man must respect the liberties of 
others: so he must respect the happiness of others. 
Every man has a right to pursue his own happiness so 
far as he does not interfere with another man's pursuit 
of his own happiness. How, then, about competing 
with a man, and perhaps driving him out of business? 
Competition exists among several people doing the 
same thing. To race fairly, each must not interfere 
with any other's doing the best he can, and govern- 
ment should see that he does not. 
Obviously, the very first thing necessary to do in 

39 



40 



The Protection 0} Rights. 



t§46 



the pursuit of happiness, is to work for a living, but 

that being, in civilized countries, a concomitant of the 

right to life itself, we so treated it. 

47 The Ri ht to There is another right essential to make 

Work involves ° the Right to Work of any value — the 

ri £ nt | °[ Property Right to retain or use up the fruits of 
and Exchange. Qne , s wofk . tfae tQ Wofk . g ^ 

for nothing unless a man can be protected in the right 
to the products of his work ; and not merely the right to 
use them, but also the right to exchange them as 
one pleases. If a shoemaker could exchange no shoes 
for bread, he would be in a bad way; or if a man 
working for wages could not exchange his money for 
anything else, he would be in even a worse way. 

The general name given to a man's right to produce, 
to keep what he produces, or to dispose of it as he 
pleases, is the Right of Private Property. Yet that 
right, like all others, is limited by the rights of others. 
47 (a) Limited, a man can exchange his property as 

like ah other ' he pleases, he has no right to spend his 
rights. wages in getting drunk, and if other people 

— his family, for instance, have a right to the money 
he spends in getting drunk, government should inter- 
fere to protect their rights. Even if nobody is depend- 
ent on him for anything, a man is seldom so solitary 
that nobody has any rights in him; and even if one is, 
government has a right to see that he conducts him- 
self so as not to annoy others, or become a charge 
upon them. A man owns a thing, then, and has a 
right to do as he pleases with it, only if he pleases 
not to injure anybody else, or to do anything that 
will harm other people more than it will benefit him (24). 
48. The Rights to ^ en se ^ om exchange product alone, 
Work, to Property and seldom does any one man even start 
fnvoive Rlghts g to with the raw material and make any 
Contract product into complete exchangeable shape. 

Generally, things are made by a number of men who 
exchange their labor for. money ; and in making these 
exchanges — in making all sorts of bargains, other rights 
arise to supplement the rights of Property and Exchange. 



The Pursuit of Happiness. 



41 



The first is each man's right that the man he deals with 
shall stand jip to his bargain — generally known as rights 
under Contract. 

49. and to Repu- Then as each man needs others to deal 
tatlon » with him, in order to get them to do so, 
there is another right almost as essential as rights of 
Property and rights under Contract — the right to 
Reputation. A man has a right not to be handicapped 
by any false reports that will interfere with his Right 
to Work and to hold or exchange the fruits of his 
work. 

But if he deserves a bad reputation, of course he 
cannot expect anybody to employ him. Otherwise, 
government should guard a man's reputation, as part 
of his Right to Work, and as part of his general Right 
to the Pursuit of Happiness. Government therefore 
punishes spreading malicious and injurious untruths. 
Moreover, a man can sue for damages to reputation. 
He has as much right to safety in his reputation as 
in his person and property. 

But, similarly with other rights, the right to repu- 
tation rests on the duty of deserving a good reputation. 
If a man sues for damage to reputation, and the truth 
of the charges is proved, he cannot usually recover any 
damages. He sometimes may, however, if he proves 
that there was malice in the charges. 

The groups of rights we have just considered, seem 
to contain all that a man needs in the pursuit of happi- 
ness, tho there are a good many others that it 
would be handy for him to have, such as rights in a 
good bank balance, and two or three good houses, 
with stables full of horses, and a yacht, and a few 

50. State does not other trifles. But the Signers of the 
furalsh means to Declaration evidently did not mean that 
rigphVSwoScSr y every man has a right to those things. 
them ' They only meant that every man has a 
right to "pursue" them, with a fair field and no favor. 
Nor does anybody mean even "them" to constitute 
"happiness". They probably do not, as often as the 
pursuit of them; and certainly not as often as the 



42 



The Protection of Rights. [§ 50 



pursuit (not to speak of the possession) of the treasures 
of the mind and heart. 

But we will not attempt anything so difficult as a 
discussion of "happiness*', but will treat of its most 
essential conditions so far as government can protect 
them, under the heads indicated. Now as to rights in 

property: people first got property by 
oropertyrighu. appropriating it from Nature — taking a 

limb from a tree for a club, or picking 
out a stone well shaped to hammer or chisel with. We 
oan hardly tell why that gave the person doing it, 
property rights in the thing: we simply know that it 
is so; or at best, we only know from experience, that 
its being so, is absolutely essential to human welfare. 
A man's right to what he has produced or appropriated 
from Nature, is one of those fundamental principles that 
the experience of mankind has found out, just as it has 
found out that two and two make four, or that rights 
and duties involve each other, or any other bottom fact 
in nature. It must have been realized very early, and 
has been better realized every day, that it is for the 
greatest good of the greatest number to admit such 
rights, and to develop custom and law to protect 
them. The conception of property rights is so ele- 
mentary that if two monkeys are on a tree, and one 
of them picks a piece of fruit, and the other tries to 
take it from him, we feel that the property rights of 
the first are invaded. 

The monkey's picking the fruit, involved some labor, 
and it also involved more or less intelligence: so the 
first conditions of property rights seem to have been the 
bounty of Nature, the desire for something, and in- 
telligence enough and labor enough to carry out the 
desire. 

Now when we follow the evolution of property up 
into man and into modern industry, we 
Voices— taw ma- find the essentials of its production to be 
aMilty lab ° r ' virtually the same three things as with 
the monkey or the savage; but with the 
names a little changed: we are now apt to call them 



§5ia] 



The Pursuit of Happiness. 



43 



Raw Material, Labor and Ability. The ttungs are 
changed too. Most mechanics use raw material that 
has already been produced by other mechanics — a 
painter's raw material is paint made by somebody else, 
and a carpenter's raw material is wood from a tree 
cut down and sawed up by somebody else, and even a 
blacksmith now seldom makes his own shoes or nails; 
but the paint and beards and hoiseshoes and nails are 
made of things that Nature furnishes directjy — from 
real raw material. 



CHAPTER VI. 



REAL PROPERTY. 

52. Land and sea Original raw material always comes 
the source of from the land — its forests, farms, and 
Raw Material. m i nes , and from the sea. But besides 
his own labor, and land (which we will understand 
as including the water and its products), man 
uses the powers of Nature, such as falling water, 
wind, heat, electricity, and the muscular strength of 
animals. Yet these are mainly developed from the 
land: to use a waterfall or tide power, a man must 
control the waterside; to use even the wind, he must 
have a place big enough to prevent others from shutting 
off his wind; to use heat and electricity, he must con- 
trol the powers already named, or some product of 
coal-mines and forests; and to use the strength of 
animals (including himself) he must feed them with 
products of the earth, or with animals that were fed 
with products of the earth. 

53. Eirly Con- Then the land is plainly the first essen- 
dltions. tial of property rights of any kind. Per- 
haps that has something to do with the name Real 
Property, or Real Estate, which is usually applied to it 
and the things affixed to it, such as fences and buildings. 

Among primitive peoples, everybody does as he 
pleases with the land, but nobody pleases to do much: 
so nobody exercises any property rights in it — no- 
body either tills or builds upon it, or even systematic- 
ally gathers any natural produce from it; nor could 
everybody do so, even if they knew how, without 

44 



§54] 



Real Property. 



45 



quarreling, and the strongest man driving the others off. 

That is what has really taken place as our part of 
the race has developed — the strongest has got posses- 
sion — exclusive rights over portions of the land have 
become the property of individuals; at first, by force 
of arms, but in recent times, by force of ability, which 
we shall see more of later. But it does not follow 
that all people having land have forcibly taken it from 
others who were weak in arms or ability. The early 
king is often at the head of a people glad to reward 
his leadership against their enemies, by making him lord 
of land which he parcels among his followers; and the 
modern man of ability, while he may control a great 
deal of land himself, generally enables those whom he 
guides to control more than they could without him. 
The savage has no idea of property rights in land. He 
simply wanders where he can find game and fish. For 
that matter, savages have not much idea of property 
rights anyhow; and this is true whether the savages 
are primitive men or the backward members of modern 
society. Barbarians, even when evolved up to the 
grade of the Spartans, have generally thought it admir- 
able to be a skilful thief; and even many ill-balanced 
members of civilized society wish to take part of the 
property accumulated by the wise and energetic, and 
give it to the stupid and lazy. 

The first germ of property rights in land, is the con- 
viction that the tribe has a right to the territory it 
roams over, so that no other tribe has a right to enter 
it. When the savage gets civilized enough to culti- 
54. Communistic va *e the soil, his idea of property rights 
ownership. i n it, is still very rudimentary — barbarians 

simply use their land in common. As civilization ad- 
vances, they portion it out among themselves for a 
short period, and then reapportion it. Even to-day 
backward people, like the Russian serfs and the In- 
dian ryots, hold their land on short leases from the 
community. But the community still owns all the 
land, just as it does among barbarians, and reappor- 
tions it from time to time. 



46 



The Protection of Rights. 



[§55 



As people progress farther than the Russians and 
East Indians, the feudal system is generally the next 
55. TheFeudil step, and it is a step toward distinct prop- 
System. er ty rights in land. It is generally a 
result of conquest. The system was (and is still, for 
that matter, in some backward places) that the con- 
quering sovereign getting possession of all the land, lets 
his dukes and great nobles have portions on condition 
that when called upon, they shall furnish and lead large 
bodies of soldiers; the great nobles parcel the land 
out again to petty lords and squires, on the condition 
that each shall help make up the overlord's quota of 
the king's army, by furnishing and leading a few 
soldiers; and these petty chiefs parcel out their pieces 
of land again to the actual cultivators, on condition 
that they shall serve as private soldiers. 

While nobody but the ruler owned anything under 
this system, it was an advance on such systems as still 
55(a). why an nn g er m Russia and India, because instead 
advance on com- of a man being shifted from one piece of 
muniam. land to another, as he is under the system 

when the community periodically takes it back and 
redivides it, he stayed on it, and his descendants after 
him, and got interested in it, and could afford to fertilize 
and make other improvements far ahead. 

The feudal system, then, was a great advance over 
the ownership by the community which goes with 
primitive civilization, because a man takes care of 
what he has some sort of permanent claim on, and 
neglects what he has not. Farms on short leases are 
always in a tumble-down condition. 
55(b). when I* 1 our own history, the communal sys- 

9atabti8h9d. tern changed into the feudal system among 
our forefathers in England, with the Saxon settlement, 
and the division of the conquered lands among each 
chief's followers. In some of the Saxon kingdoms the 
system was evolved faster than in others. It can 
hardly be said to have become universal, however, 
before Cnut the Dane was able to impose a uniform 
rule over all England. 



Real Property. 



47 



55 rc;. Evolution When he conquered England, he di- 
of hereditary vided what land he did not keep himself 
feudal relate his g^at jarls (earls), but only for 

their lifetimes. That was the first transition step toward 
the present system of an ownership forever, subject to 
only such taxes as the government may impose. At 
the earl's death, the king was again nominal owner; but 
as the earl had subdivided among a great number of 
followers, of course it was to the interest of these fol- 
lowers, as well as of the earl's family, that things should 
be left undisturbed; and it was also to the king's 
interest (unless he wanted to put a new favorite in the 
place), provided the successor would render him the 
same support in men or produce that his predecessor 
had rendered. Thus, as it was to the interest of all 
in possession, that no new favorite should come in and 
upset things, in time they generally succeeded, by 
arguments or payments or threats, in inducing the 
king to invest the dead man's son with his father's 
rights. 

55 (d) euardian- t ^ le °^ principle that the land was 

ship, 'disposal by the king's and returned to him as soon 
marriage. ^ ^ holder died, gave the king opportu- 

nities to exact heavy payments before letting widow 
and children succeed to the holdings of the husband 
and father. This was the original of our present suc- 
cession tax. It also led to the king having rights of 
guardianship over all minors, and of disposal of widows 
and fatherless maidens in marriage; and he generally 
got pretty big prices for the rich ones, and pretty 
large commissions out of all estates. Now the only 
relic of any such rights is, in England, the Chancery 
Court; and in America, the Surrogate's Court, or Pro- 
bate Court or Orphans' Court — the name varying in 
the different states. All of these courts try to see 
that nobody imposes on widows and minors, and they 
all charge very moderate fees — probably less than 
the cost of keeping up the court, and in some states 
none at all. 

To perfect the system started by Cnut, William the 



48 



The Protection of Rights. 



[§ SS^ 



55 eh Domtsday Conqueror had an itinerant commission 
Book - called barones regis make careful reports 
of all the lands in England, with the occupants. These 
reports made the celebrated Domesday Book. He con- 
fiscated land right and left, and put all he could under 
feudal tenure, but it took till the reign of his son Henry 
to finish up the system. 

56. Evolution of The fi rst definite step toward an owner- 
private ownership. s hip more private still, was taken in the 
twelfth century, when Henry II. (Becket's friend) needed 
soldiers for war in France. His tenants, like our own 
. c/ , - . militia, were not obliged to fight away 
from home: so to get money to hire sol- 
diers to fight abroad, he took from his knights "scu- 
tage" (shield-money) for rent, in place of military ser- 
vice. 

56 (t). Leases for But as militarism declined with barba- 
labor. rism, and soldiers were needed less often, 
those who controlled land began to let it out for 
other rewards than military service — sometimes even 
for farm service on the land retained by the landlord 
himself, to be rendered between times, when the tenant 
was not cultivating his leased land ; and sometimes for 
part of the produce; and sometimes for money pay- 
ment. A very ill wind blew most of this good with it: 
for the Wars of the Roses left the nobles in great need 
of money, and but little need of military service. 

56 (o) Mon*y ^ ut tenant-service, and even money- 
eommutation of rent, still left nobody permanent owner of 

labor leases. j and but the king; and the next ^ 

vance naturally came about by one big payment for 
life or for all time, in place of the annual payment; 
or by increased annual payments for an agreed series 
of years, on condition that all payment should stop 
at the end of the time. 

Now it may be asked what is the use 

XmerlcsL" tinure ln of our g°i n & over a11 this history? Could 
not our ancestors have started on a pri- 
vate-property basis in America without it ? But where 
could they have got the idea? It had to be evolved. 



§S9l 



Real Property. 



49 



The full-grown ideas that we take as matters of course 
to-day, have been the slow work — often the bloody 
work, of centuries. 

Land-tenure started in America by the kings of Eng- 
land, France and Spain, giving much of the land to 
individuals and companies, and these divided it up 
among the people of the settled portions. In time, 
most of the land not so divided up came, in one way 
and another, into the possession of the United States 
government. 

The government has kept some still, has thrown some 
open to rights of ownership by settlers on various con- 
ditions, sold some to individuals, reserved some for 
National Parks, given some to the Pacific Railroads 
and a few other roads, so that they could sell it for 
money to build the roads ; and also given some to the 
states in aid of agriculture, the states having in turn 
given it to educational institutions which sell it to 
get money to pay expenses. 

All the systems of use of land which 
t&l&Lrwongall have been described, exist somewhere in 
peoolesofthesaine the world now — there is plenty of land 
gra now in the condition that all land was in 

once— desert, or with savages roaming over it — land 
which virtually no one owns. Then there is land in 
every one of the conditions of tenure which we have 
been describing: — among many partly civilized peoples, 
there is common land and feudal land ; among civilized 
rural communities there is much land let out for a 
share of the product; and in both rural communities 
and cities where civilization is at its height, there is 
land whose rents are always paid in money; and last 
of all, there is much land, in both city and country, 
owned by those who occupy it. 

Private property in land, whenever and 
•rtyManVa*" where ver it has become established, has 
gnbt ttlmului to been probably the greatest single step in 
y * civilization. With it, appeared the first 

chance for everybody with talent and energy to get 
possession of land, and of the social consideration which 



The Protection of Rights. 



[§59 



that possession brings. Outside of war, politics, and 
the church, this was the first offering to energy and 
invention, of the great prizes that have made the differ- 
ence between the forest-community with no letters or 
arts, and the community with steam, electricity, books, 
schools, libraries, galleries, orchestras, and world-wide 
travel — in a word, modern civilization has grown up 
with private property in land. 

This is saying distinctly that civilization has been 
the work of a few prize-winners, or at least prize-seekers 
— the men whom the chance of private property stimu- 
lated — that it has been the work of individual men, 
and not of the race — of a few able men guiding the 
rest. 

Often in barbarous times, the strong 
man »J diance^ot man's chance is at the expense of the weak, 
the weak pense °* ^ut se ^ om * n civilized times: a civilized 
government tries to give all men a chance 
to get all they can and keep all they get. That gives 
the able man his chance, no matter how poor his start. 
Rapid new development of corporations (140) in the 
United States has just now outgrown the government's 
capacity to control some of their overreachings. But 
the cases are sporadic, and it may be hoped that govern- 
ment will soon rise to the situation. Ordinarily, under 
a good government, the strong man does not generally 
get his sustenance from the weak one. On the con- 
trary, he gets it from Nature, through energy and in- 
vention. Widening and securing the range of private 
property, leads the strong man to work harder and 
invent more, by making his prizes greater, and increas- 
ing his hold on them. And it does even more for the 
weak man: it not only stimulates him to do his little 
best, but gives his property a protection that the strong 
man does not need, because he can take care of his 
own. Another advantage to the weak man under a 
constitution that recognizes and secures private prop- 
erty, is that the strong man will be stimulated to reclaim 
and cultivate so much more land, and to make so many 
more things, that he will find much more profitable work 



§61] Real Property. 51 

for the weak man to do, and provide much more for 
the weak man's good. That is proved by the wonder- 
ful increase in rich men's gifts for the general benefit. 
61 Proportion of pri- ^ wou ^ be expected, then, as is found 
viteowneraircrdwei to be true, that as civilization advances, 
with clvliizit an. ^ e proportion of absolute private owners 
of land increases: in fact there is no more marked evi- 
dence of the progress of civilization than that relative 
increase; and there is no better field for philanthropy 
or strengthening the state, than increasing the number 
of people who own at least their homes. Napoleon 
made it the law in France that the land of a person 
dying should be divided among all his children. This 
has produced an immense number of private owners, 
and they are among the richest and best citizens of 
their class in the world.* Yet this dividing could be 

* For over forty years there has lingered in my memory a 
quotation from Michelet, in Mill's Political Economy, regarding 
tne effect of private property in land, and, as poetry is stronger 
than philosophy, it has probably done more to make me realize 
the merits of the question than all the discussions I have read 
since. It seems worth translating here. 

"If we want to get at the inmost thought, the passion, of 
the French peasant, it is very easy to do. Let us take a walk 
some Sunday in- the country, and follow him up. See him walk- 
ing down there before you. It is two o'clock; his wife is at 
vespers; he is gotten up in his Sunday best; and, I am ready 
to vouch, is going to see his mistress. 

" What mistress? His land. 

" I don't say that he will go directly. No, he is free to-day, 
he can go or not as he pleases. Doesn't he go there often 
enough every day of the week? Moreover, he turns away, he 
goes somewhere else, he has business somewhere else. But he 
will go there all the same. 

" It is true that he goes very near: but that just happened 
so. He looks at it, but apparently he will not go in; what 
has he to do there? But he will go in, all the same. 

" Nevertheless, it is probable that he will not do any work; 
he is gotten up for Sunday ; he has on a white blouse and a 
white shirt — yet all that does not stop him from pulling out 
an occasional weed, or throwing out that stone. Then there is 
that stump which annoys him, but he has not his pick with 
him: so tne stump can wait till to-morrow. 

" Then he crosses his arms and stands still, looks around 
earnestly, carefully. He looks long, very long, and seems to 



The Protection of Rights. 



carried to a point where the heir's farm would not be 
big enough to support him or pay for using expensive 
machinery; but then he can sell out and go to manu- 
facturing or shopkeeping. The difficulty would cure 
itself. 

Our own country shares with France the leadership 
of the world in wide dissemination of the ownership 
of land, and the fact is of very great importance to us: 
62. Landowners t ^ le * ar g e numbers of people owning their 
the best guardians own farms and their own homes in America, 
of government, pro bably do more in the desperate fight to 
keep the government prudent and patriotic, than all 
other influences put together. Any man owning land 
must pay taxes — he cannot hide his land from the tax- 
gatherer : therefore he must have a stake in honest and 
economical government. We shall see much more of 
this very important consideration. 

The French peasants make better in- 
thHffy citizens" 1 comes tnan other small farmers, who 
lease their land, just as our farmers who 
own their land, generally make better incomes than 
those who lease it : a man cares for that which belongs 
to him in a way that he cares for nothing else, and 
enjoys caring for it to a degree that keeps him cheerful 
and capable; the more cheerful and energetic he is, 
the more he produces; and the more that a man pro- 
duces, the better not only for him, but for the whole 
community, because the cheaper it can be sold to those 
who do not produce it. 

64. Exaggerated Some people have pushed reasoning 
fo«golngad t - he * rom tnese advantages, to at least two 
vantages. very absurd extremes. 

forget himself. At last, if he thinks anybody is looking, if he 
sees anybody coming, he moves off with reluctant steps. Yet 
at thirty paces, he stops, turns again, and casts over his land 
a last look, a look deep and somber, but to one who knows 
how to see, the man is thrilled, his look is from the heart, 
charged with devotion." — Le Peuple, par J. Michelet, I r * 
partie, ch. I. 



§6 4 a] 



Real Property. 



53 



As the first, they say that as every person born has 
a right to exist on the earth, and therefore a right to 
a place of existence — to a home: every person is en- 
titled to own a piece of land. 

It is hard to see how that right can be good against 
anybody but his parents. Nobody else ordered him 
here, and certainly a man with a little or no land, can- 
not have a right to bring into the world as many children 
as ne pleases, and require other people to give them 
a part of their land. The only condi- 
ttahom!y lgkt ti° n upon which a man can claim a right 
to land or to anything else, is, of course, 
by performing the duties which correspond to the 
right (23, 25), either by appropriating what nobody 
else had a right to (51), or exchanging for what he 
wants, something he had appropriated or produced. 

And even suppose it possible to give every man a piece 
of land, how long would most of them keep it? Appar- 
ently until they could sell it or give it away — one 
cannot always do either. It is now very hard to 
keep people on the land, they are flocking more and 
more to the cities, even if they have to live in tene- 
ment-houses. In 1905 one third of the half million 
Italian immigrants were in the slums of New York, 
while the agricultural industries of the South, in a 
climate and labor congenial to the immigrants, were 
crying for them in vain. 

Yet the Salvation Army's farm colonies, for instance, 
are excellent as far, as they go. . But so far, they have 
got only a trifling portion of the three million people 
they say they ought to have. With more money they 
would get more, but not enough to reverse the rule. 

Yet in spite of all the facts, there is a great outcry 
against holders of idle land, for keeping the starving 
millions away from it; but there is always a great 
outcry against holders of anything by those who do 
not hold anything, and all the time this idle land is 
paying taxes which would not be paid if government 
owned it. 

The second reason given for the claim that every 



54 



The Protection of Rights. [§ 64 b 



man has the right to own a piece of land, is that e very- 
man has a right to a living, and that as 
toa b t!'oiniy i0ht everything that sustains life comes, in the 
first instance, from the land, every man 
has a right to enough of the land to make his living out 
of. There are two answers: no healthy man has a 
right to a living unless he earns it, or gets it honestly 
from somebody who did earn it; and there are endless 
ways of earning it without owning land, as already 
stated, many people cannot be forced to make their 
living out of the land. Moreover, not every prosperous 
man gets his living directly out of the land, even many 
very rich people do not own any land; and in fact, not 
one American in ten owns any land whatever. So it 
does not seem necessary that, to have a home and 
make a living, a man must own land. 

As a fact, any energetic poor man, under ordinary 
circumstances, can get a farm to work if he wants it. 
The older parts of the country, New England and the 
South, abound in empty farms begging for tenants to 
work them on shares; and the new Western wild land 
needs them as much; there is plenty of open land and 
sunlight and fresh air within easy reach of the people 
who are packed in the city tenement-houses, but they 
will not go to it. 

But to work land, men require capital— money, 
horses and farm machinery, and it may be urged that 
it is because of lack of them that they will not go to 
the land. But the fact is that the men who have farms 
and capital to work them, are suffering because they 
cannot hire labor; and all the while people are working 
in other pursuits, at worse wages, and penned up in 
city tenements. In answer to this, it is urged that 
as the laborer going to work on another man's land, 
would not make him its owner, the laborer's not going 
for hire does not prove that he would not go if the 
land were his own. But those who own land are 
leaving it more and more. If anybody else wants any, 
he can prove his right to it, as he can to anything else, 
by earning it. 



§66] 



Real Property. 



55 



65. Land valueless ^° * ar as observed, those who object to 
to all but able private ownership of land, have not gen- 
men * erally shown any particular inclination to 

work the land or improve it, or any ability to do it if 
they try. The objection is most generally made by 
men who have not had much success in any other pur- 
suit, and that is a poor show for success in farming: it 
certainly requires as much ability as any other ordinary 
pursuit. People are constantly taking up land who 
cannot support themselves on it, and who end by work- 
ing for the people with the ability to show them how. 

On the whole, then, it does not seem to make much 
difference whether everyone is entitled to a portion of 
the earth or not, as long as those who are able to do 
anything with it. are generally able to get it ; and those 
who are not able to get it, would not generally be able 
to do anything with it if they had it. 

66 Pro sed ' ^° muc ^ t° T tne exaggerations of the 
reverslonto gov- advantages of private ownership. Now 
ernment ownership. ag ft fact> those gui]ty of these exag g era . 

tions are generally about as consistent as people given 
to exaggeration usually are. Those who in one breath 
thus magnify the benefits of private ownership of land, 
in the next breath generally propose to do away with 
private ownership altogether — they generally propose 
that government shall take all the land, and that 
everybody who uses any, shall pay rent to govern- 
ment, instead of, as now, owning the land without 
rent, or paying rent to a private party. And all that, 
in face of the plain fact that if government did take 
all the land and pay for it and rent it to the people, 
it could make no difference to people now paying rent, 
unless they should pay less rent, and then it would 
be simply a scheme for government making a present 
of the difference, to anybody who wanted land, at the 
expense of those who did not. 

This speculation was once proposed by John Stuart 
Mill to the English government. If they had gone 
into it, instead of people in general being gainers, as 



The Protection of Rights. 



[§66 



expected, the landlords would have been the gainers 
at the expense of the rest of the community: at a fair 
price, the lands of England would have cost the govern- 
ment more then than they were worth fifty years later: 
so far have our wheat and cattle, and those of Australia, 
taken the place of England's productions. 

But government's taking all the land by robbery, as 
is quite widely proposed by those who have none to 
lose, and renting it to the people, would help the tax- 
payers more than it would the poor: for the state 
would receive all that rent-money, and need less for 
taxes. But the landlords pay most of the taxes now: 
in New York and Massachusetts, for in- 
suppfehTgovern- stance, four fifths of those collected di- 

ry e 3t t em? dere,ther rectl y- And most of the other fifth— the 

taxes on personal property, are un- 
doubtedly also paid by the persons owning the land. 

Then after all, the scheme would be as broad as 
long: for government ownership would not put the 
land in new hands. If anybody wants land and has 
the money to pay for it, he gets it now. What differ- 
ence would it make if he got it from government? 

Last of all, the state is not apt to make a good land- 
lord: for it already has more to do than it does well 
or honestly. 

ro 8 bbe 0m whk V h 0Ctte ^° * ar as we ^ ave g° ne > then, there does 
would disappoint not seem to be any rhyme or reason in 
them ' the scheme of government ownership: so 

there is probably some "true inwardness* ' that we 
have not yet attained to. That inwardness is that 
all these foolish notions that we have been considering, 
are given as reasons why government should take all 
the land without paying for it — take it either directly 
or by taxing all the value out of it, and rent it to 
those wanting it, and devote the proceeds, above the 
present amount of taxation, to public works and the 
benefit of the poor. That certainly would at least be 
helping the poor at the expense of the rich; but not 
as exclusively as its advocates intend: for many of 



Real Property. 



57 



the rich have little or no land — many owners of large 
tracts are land-poor with their holdings mortgaged for 
more than they are worth, and many of the poor, if 
they were to receive land as a gift, would not keep it. 

Yet certainly the scheme would help some of the 
poor at the expense of some of the rich, but it would 
help more of the rich at the expense of all of the poor: 
for any attempt to carry out the scheme would make, 
for a time, the greatest financial upset ever seen, and 
there never yet was a financial upset in which the 
rich did not generally hold on to what they had, and 
buy cheaply what the poor had to part with at forced sale. 

Government ownership of land, then, is 
to 9 hc]Jth°e n pWs on e of half a dozen schemes to help the 
g help th^m help poor without their helping themselves, 
which are all equally unsound, and which 
we will see more of as we go on. This world was 
plainly made for the people who help themselves, and 
there has been no way discovered for anybody else to 
get much good out of it. Yet helping oneself is not 
the only way to get good: more still can be had from 
helping one's neighbor, but a man cannot do that be- 
fore he takes reasonable care of himself. 

We will more fully consider the questions of the 
care of the poor, when we come to treat of govern- 
ment's promotion of convenience. For the present 
we are busy with its protection of rights. Now out- 
side of alleged "public policy", which embraces the 
points we have considered already, there is twofold 
moral justification alleged for protecting the rights of 
the community by robbing present holders of their 
land — first, that the land originally belonged to every- 
body, and was wrongfully seized by those from whom 
its present owners got it, and therefore should go back 
to everybody; second, the famous "unearned incre- 
ment " argument. 

70 The moral anru- ^ s to s P°^ at i° n argument, there 
ments-^origlnal " is no evidence for it, except in such cases 
general ownership. as when Europeans dealt with Americans 



The Protection of Rights. 



and Africans. If most of the land in Europe and 
Asia was stolen by the original grantors of its present 
owners, it was " stolen from a thief": for it had been 
conquered and reconquered over and over again. The 
rights of the present owners are vastly clearer than 
any other rights that could be presented: no descend- 
ants of previous proprietors who might want to stand 
in the shoes of the present ones, could prove any rights 
at all: if they could, courts are generally open to them. 

But where civilized people have robbed barbarians — 
the case of our ancestors in America, if you please — 
that case might be a reason why the present owners 
(including the heirs of Henry George, if he owned any 
land) should give the land back to any heirs of the 
savages they can find; but it cannot possibly be a rea- 
son why the owners who are not heirs or followers of 
Henry George, should give it to those who are. The 
barbarians had not much idea of any such rights them- 
selves : those rights take shape only as a civilized com- 
munity grows up on the land. But some people we 
call barbarous do use their land, and some land has 
been taken from barbarians of that kind. Yet there 
are very few such cases, and in most of them it is too 
late to find anybody representing the barbarian owner; 
and even if it were not, it is too late to do justice to 
the former interests without doing more injustice to 
interests now vested. Many a piece of land which was 
never worth a dollar to the barbarian, is worth millions 
to present innocent holders. 

As a matter of abstract justice, you might give the 
barbarian the dollar if you could find him, but that is 
not what Henry George's followers are after. Yet of 
course in theory, where civilized people have got posses- 
sion by force, and not, as Penn did, by bargain, justice 
should be done if it were possible. Some deny that 
Penn's buying a great state for a few beads was a fair 
bargain. But that was more than it was worth to the 
savages. The fact that civilized men have made it 
worth more, is not one that the savages are entitled 
to any benefit from. 



§72] 



Real Property. 



59 



In a similar case, those who sold the site of the city of 
Chicago little more than a lifetime ago, for a mere song, 
are not entitled to any benefit from what later owners 
have done with it : for what the latter men have made, 
is their own. 

Even if the site had been obtained by 
Sme^dyTnjustke fraud, it ought not to be given back to 
lncTeMe$ s lt? n,y t ^ ie original owner if he can be found : for 
such a doctrine would stop all enterprise — 
nobody could build or cultivate with guarantee that 
some far-back landowner or his heirs would not come 
along and claim the land and, of course, all on it. 

Yet nobody can get a good title to land or anything 
else through fraud, nor can anybody convey any better 
title than he has himself ; and a title obtained through 
fraud fifty or a hundred years ago, and passed from 
hand to hand since, cannot be anything but a fraudulent 
title. 

But on the other hand, receiving an 
dJtiw^oTnewhip old title, good or bad, is not the only way 
owlfership hts ° f to a g° oc * title. Using the land, or 
ne * doing other duties incident to ownership, 

will answer the purpose. The law provides that any- 
body who performs duties of ownership for a reasonable 
time (varying in different states — usually twenty years) 
during which nobody else has performed any, has a 
perpetual right to the land; and has that right, even if 
the land clearly belonged to somebody else at the 
beginning of the twenty years. 

Such a law is justified by at least three good reasons : 
first, no one has a right to neglect his property so far as 
neither to use it himself, nor assert ownership while 
another is using it; second, if an owner will not use 
land, it is an advantage to the community to have 
somebody else use it; third, if a man honestly comes 
into a title that was originally fraudulent, a'nd the 
rightful owner does not assert his claim within a reason- 
able time, the honest occupier should not be disturbed 
in the enjoyment of whatever improvements he may 
have made for his own benefit and that of the community. 



6o 



The Protection of Rights. 



73. Rights in Im- Attempts have been made to settle the 
nrovements. matter by letting a claimant after twenty 
years of another's adverse occupancy, pay for the im- 
provements. But that was found to discourage improve- 
ment, because the motive to improve is not merely to 
get back cost, but to develop a profit. 

There were two justifications cited for the proposed 
robbery of present owners of land. The "original rob- 
bery" one being disposed of, we come now to the "un- 
earned increment" one. Wherever population grows, 

74. The unearned l an d increases in value. If a man owns 
increment. a lot worth a thousand dollars in a village 
of, say, a thousand people, if that village grows to con- 
tain two thousand, the value of the land is apt to be 
increased by the coming of the second thousand, and it 
is claimed that the community is entitled to the increased 
value, because the increment of value is "unearned" by 
the owner of the lot. 

This good reasoning does not cover the case. The 
second thousand people do not do anything to a former 
resident's lot, and certainly the first thousand did not: 
so how can either have any claim on its increased value? 
The owner is the only person who does anything to it, 
even if he only pays the taxes on it. If he starts on it 
an industry which increases the population, he does 
something to increase the value of every piece of property 
in town, and he, if anybody, is entitled to the "unearned 
increment". But the unearned-increment advocates 
claim that it should be given to those who have not 
built anything — to the poor. As a matter of fact, 
74(a) Not char- i ncrease °* population must bring all the 
acteri'stic of land unearned increment to the business of a 
<Uone ' newspaper or a store or a blacksmith shop, 

that it does to land, and more : for all the increment that 
land can get, it must get from increased rent paid by 
business of some sort, even if that business be farming. 
(Scientifically speaking, all benefits coming from the 
use of land are "rent", even if the owner gets them.) 

Every man who does his work well — every capable 



§74 <*] 



Real Property. 



61 



and honest man who does something to improve the 
lives of people, raises the value of land near him ; but 
that gives him no right to any but an incidental share 
in the benefit he confers on his neighbors — except that 
it does make it fair that his neighbors should recipro- 
cate by being capable and honest too, and so conferring 
benefits on him. 

The community has no more right, then, to partly 
take possession of land by taxing away the unearned 
increment, than by doing the same to the unearned 
increment of the blacksmith's business or the news- 
paperman's or the butcher's or baker's or candlestick- 
maker's. 

Under the present system, people invest in unoccu- 
pied lands on the chances of the unearned increment, 
and pay taxes and lie out of interest. If government 
took possession, it would have all the unimproved land 
on its hands, with nobody to pay taxes on it. Of all 
the wild follies written in advocacy of government 
ownership, the wildest is the assumption pervading 
most of that writing, that if government owned the 
"land which nobody cares to use now, such land would 
all come into use, and all the poor be made rich by it. 

And after all the fuss, it is very uncertain how much 
unearned increment there is to tax. That is largely a 
question of time and place. Henry George claimed 
that paying the rent on unearned increment, directly 
and indirectly, is the cause of virtually all poverty ; and 
yet Superintendent Harris, in the Educational Review 
for May, 1905, says: "Careful investigation has shown 
that [rent of] land in the United States is a small burden : 
only one eighteenth of the . . . earnings of the people 
in 1880 — two and one-fifth cents per day as against 
average production of more than forty cents a day for 
each inhabitant." I know of no later calculation. Tho 
one could be made without much difficulty, it would 
be superfluous. Professor Mayo-Smith says: "From 
the experience of England ... it may well be ques- 
tioned whether the present ground-rents of agricultural 
land represent more than a fair return for improvements 



62 



The Protection of Rights. 



[§ 74 a 



made. So too, in regard to the unearned increment, it 
appears that there are numerous losses as well as gains, 
so that it is doubtful whether, on the average, and in 
the long run, land property is any more advantageous in 
form than any other kind of property.' ' 

The whole consideration seems to show that the 
idea of everybody being entitled to a piece of land, 
or of government appropriating it for the general good, 
is simply a proposition to return to the 
abolish private* t0 half-civilized communal system — to go 
relrozreisive! hack to where India and Russia are, and 
wipe out all the stimulus to careful and 
energetic and forethoughtful management, that rests in 
private ownership. 

Aside from the impossibility that a man should do 
much for a farm that he holds for a short time, the 
communal landholding of backward nations helps keep 
them backward, because habit and the chance to get 
land for nothing incline such people to keep on working 
the land: therefore fewer people are led to manufac- 
turing, commerce, and the other pursuits which per- 
haps do even more than the primitive and sequestered 
one of farming, to advance civilization. 

At first it seems a paradox that while in America 
it is hard to get people to take up the abandoned farms, 
in Russia it is hard to get people away from the com- 
munal land. The explanation is that the Russian and 
his ancestors have been so long under the deadening 
influence of communal land that he cannot rise above 
it; but the American has always been planning ahead 
for his own land, so the habit of thinking a long way 
ahead and outside of his daily round has been formed 
in him by the private ownership of land. 

76. Private "rooerty J he management of land is not simply 
In land of universal the owner s lookout, or that of the holder 
Importance. for the time being> If h e does not manage 

well, he is not the only one to suffer. Everybody de- 
pends on the land, whether he owns any or not, for his 



§77] 



Real Property. 



63 



food and clothing and everything he uses, except what 
comes from the sea. So it is to everybody's interest that 
the land should be managed in the most careful and pro- 
ductive way; and the first essential to careful and pro- 
ductive management of land or anything else, is that 
a man should be sure of reaping where he sows — of 
getting the results of what he plans — that he should 
own the thing he works upon. While very few people 
own the things they work upon — even the farms, not 
to speak of the factories and shops, it is not unreason- 
able to look forward to the time when most men will. 
It is true that while hundreds of men work on a single 
railroad or in a single factory, or even on a single 
farm, they cannot each own it, but things are rapidly 
shaping themselves so that each can own a share in it, 
if he is economical enough and wise enough to do 
any owning at all (126). 

77. Rights In land ^ ought to be plain by this time that 
llmitwriike all it is as much the state's duty to protect 
fight,f rights to land, as rights to life or liberty. 

But we saw that it sometimes becomes the state's 
duty to limit the citizen's rights to life or liberty, and 
we could expect to find the same true in regard to his 
rights to land. 

Whenever the greatest good of the greatest number 
requires it, the state should take the citizen's land, 
and despite the theories we have been considering, 
experience seems to prove that a case where the state 
should take it without paying for it is not apt to arise. 
At least the fathers of our government were so well 
satisfied that it never can (in this being less wise than 
the Henry Georgians think themselves), that as early 
as 1 79 1, it was provided in the Constitution that land 
taken by the National Government for public uses 
must always be paid for.* 

The two principal sets of circumstances under which 
land is so taken, are when the right to take it at a 



* Amendment V. 



64 



The Protection of Rights. 



78. Rights of fair valuation is given to citizens working 
Eminent Domain. f or the public accommodation — to rail- 
road companies and water companies, for instance; 
and when the state itself obliges holders to sell their 
land for the use of legislatures, courts, custom-houses, 
post-offices, police-stations, forts, barracks, dockyards, 
roads, railroads (where the state builds them), and 
many other purposes. 

The greatest good of the greatest number requires 
that a railroad should take a direct way, instead of being 
obliged to zigzag only where people are willing to let it 
go; and so the state may rightly enable a railroad to 
cut a man's farm in two, or perhaps tear down his very 
home; but it must compensate him. The government 
usually decides through Some form of legislation, when 
the greatest good of the greatest number requires a 
proposed railroad; and if the justice of the law is dis- 
puted, it must also be passed upon by the courts. Be- 
sides deciding that the road would be for the greatest 
good of the greatest number, the state must also give 
the authority to lay out the road, and compel people to 
sell the right of way at reasonable prices. Where the 
parties cannot agree on values, the courts appoint com- 
missioners to fix them. 

The right of the state to take land or authorize citizens 
to take it, is called the right of Eminent Domain. 

One other condition places the citizen's rights in land 
at the disposal of the government: land can be taxed 
of course, like everything else, and sold if the taxes 
are not paid. 



CHAPTER VII. 



LAW OP REAL PROPERTY. 

Now we have some notion of the rights of property, 
especially as concerns the land. Next let us consider 
the rules under which rights are protected and trans- 
ferred. Those rules are called the Law. 
79. The Law In No man ever had a thorough knowledge 
general. Q f the law. It is the most colossal product 

of the human mind. Yet many men have thoroughly 
known its outlines and some of its parts. To have a 
good working knowledge, one must know some dozens 
of big volumes well, and also know how to consult 
some thousands. It need hardly be said that we can 
get but very slight notions of it here, but those slight 
ones may be well worth while. 

Every citizen should have some appreciation of where 
this immense mass of wisdom and justice comes from, 
and an adequate appreciation of it stirs the admiration, 
the reverence and even the affection of every liberal 
mind. The law has been evolved slowly from many 
sources. The four principal ones have been, first, Con- 
stitutions — agreements made by peoples as to what sort 
of executives, legislators and judges they shall have, 
and what powers those functionaries shall have; second, 
Statutes, rules made by legislative bodies — from primi- 
tive tribal assemblies down to modern parliaments, con- 
gresses, and state legislatures (perhaps in these we should 
even include the law-making bodies of local govern- 
ments) ; third, the Administrative Law — the decisions 
and practices of the executive or administration in the 

65 



66 



The Protection of Rights. 



course of its business — such as the rules of the treasury, 
the custom-house, the post-office and the other depart- 
ments : many of these have been confirmed by courts or 
legislatures or custom, and so become permanent parts 
of the national policy ; and fourth, the Common Law — 
the decisions made by judges (the judges in primitive 
times having generally been priests). These decisions 
have been handed down, first by tradition, and in 
modern times by a very thorough system of printed 
reports, with elaborate summaries (called digests) and 
indexes. These volumes of reports now contain the 
main bulk of the law. They are consulted in all im- 
portant trials, and arguments and decisions are based 
on the points of the case in hand which have been 
decided in previous similar cases. Moreover, the grow- 
ing wisdom of the ages has been shaped into a number 
of maxims that have great authority in the law, some 
of which we shall see hereafter (85, 182, 186, 191, 205, 
214, 214/, 385). Many of them are in Latin, dating 
back to the time when our legal proceedings were gen- 
erally conducted in Latin — some of them even back 
to Rome. From judges' decisions and maxims, and 
occasionally from statutes, learned writers have made 
many compendiums showing which way the weight of 
opinion has gone in various classes of cases. These 
constitute what are called the "text-books", on such 
subjects, for example, as Real Property, Contracts, 
Evidence, Corporations, and hosts of others. 

As Constitutions prescribe what the officers shall be, 
and their powers, all other bodies of law are made by 
those whom the people elect to make them. All other 
powers are reserved to the people. If officers want 
more powers than the constitution gives them, the 
constitution must be amended or a new one made. 
Constitutions, with their amendments, are voted on by 
the people. Countries like Russia or Turkey, without 
constitutions, are governed by those who seize the 
power or inherit it. 

In England, Parliament has power to change the 
constitution, but the people have power at any time 



§8o] 



Law of Real Property. 



67 



to change parliament, not needing to wait for the regu- 
lar time, as we do. 

As the administration is under the control of the 
constitution, and to some extent under the control of 
the legislature and even of the courts, administrative 
law is constantly merging into constitutional law, 
statute law and the common law. 

While the president, or any one of his cabinet, or any 
officer acting under any of them, must to some extent 
make his own decisions and shape his own policy, he 
must do it within the lines laid down by the constitu- 
tion and the laws; and anybody thinking himself 
aggrieved by any public officer, generally has some 
sort of right of appeal to the courts. Similarly, judges 
under the common law must decide in accordance with 
the statutes and the constitution; and framers of 
statute law, while they can override common law (sub- 
ject to the danger of having its weight finally lead to 
neglect or repeal of the statute), cannot override con- 
stitutional law: if they do, the courts will declare the 
statute null. 

The order, then, of the four bodies of law, in respect 
of their control, each but the last controlling what is 
under it, is Constitutional Law, Statute Law, Common 
Law, and Administrative Law. Constitutions control 
legislatures, judiciaries and executives; legislatures con- 
trol judiciaries and executives; judiciaries control ex- 
ecutives. When executives attempt to control any of 
the other powers, as they are often, especially lately, 
accused of doing, they incur disapprobation, and risk 
impeachment and deposition. Similarly with judges 
(unless they have constitutions at their backs) when 
they place themselves in opposition to legislatures, or, 
of course, when they attempt undue control of execu* 
tives. 

80 Real Estate We wil1 be ^ n our consideration of the 
and Personal law of property in land, with a few ele- 
Property. mentary general notions. As you will re- 

member, the name given to property rights in land and 



68 



The Protection of Rights. 



[§8o 



the things fixed to it, is Real Property, or Real Estate, 
or, for short, Realty. Movable property is called Per- 
sonal Property. One reason for calling land and the 
things fixed to it, Real Property, was probably because 
it is the source of all other property, and it looks as 
if another reason was because land is less apt than other 
property to slip out of sight. 

But the rights in real property are not actually 
more "real" than the rights in personal property. The 
name deceives most people. Real estate usually fluctu- 
ates more in value than personal property, and is 
probably oftener hard to find a buyer for. 
81. Uws protecting First, then, as to protecting the enjoy- 
ownershlp. ment of property rights in real estate: 
anybody may properly enter one's house or grounds 
for any reasonable purpose, for instance, to make a 
81 (a). Damages visit or a short cut on foot or with a team, 
for trespass. unless the owner objects. But if he does 
object, unless the person were doing some real harm, 
the juries would probably give less damages than a 
lawyer would cost. 

81 (b). Right of If one has posted up a notice forbidding 
ejectment persons to enter, greater damages would 

probably be given. If the owner orders a person off, 
and he refuses to go, the owner can use force, but 
not enough to do serious injury. If he cannot get 
rid of a trespasser without doing serious injury, he 
may have to get an order from a court prohibiting him 
from staying or coming; and if he violates that, he 
will be shut up for contempt of court. An officer of 
the law can use all the force necessary to take his man, 
even if it kills him; but he must be careful not to use 
more than necessary. If an officer cannot get a tres- 
passer off, he has a right to call upon everybody to help 
him. If in the course of the argument, the stubborn 
gentleman seems likely to injure somebody else, 
everybody has the right of self-defence, up to any 
point. 

If a man squats on land and builds a shanty there, 
the owner can remove him and his shanty, if it is 



§826] 



Law of Real Property. 



69 



possible to do so without violence. If it is not, the 
owner must appeal to a court to order him off. 

If during an owner's absence, somebody has built 
upon and improved land, claiming it as his — even under 
a mistake, the owner may go to court for an order of 
ejectment, which will be granted unless the occupant 
shows a good case. 

82. Laws affecting Now as to transferring property rights 
transfer*. j n land. Rights in personal property are 

generally recognized by possession — the property usu- 
ally (we will deal with some exceptions later) being 
near the person of its owner, and transferred by delivery. 

But one cannot deliver a piece of land, and it can- 
not always be near enough the person of the owner 
to be recognized as his, unless it happens to be his 
home estate or the location of his business. Hence in 
old times, ownership in real estate was transferred and 
recognized by the man who made the grant, and his 
grantee, walking around the property together, gener- 
ally with witnesses, and then the grantor delivering to 
the grantee a token of possession, such as a piece of the 
soil or a twig from one of the trees. 

In your reading, you may often come across a tech- 
nical phrase for this ceremony, which was called "livery 
82 (a). Uoery of of seisin." Livery is plainly connected 
«•/«/«. with delivery, and seisin is connected with 

the fact that in early times (and even now in law phrase) 
the owner was said to be " seised' ' of the property — a 
suggestion that in rude times " seisin' ' was not always 
connected with 4 'livery." But livery of seisin is not 
the usual method, even in our gentler age, tho it does 
survive in some remote and primitive regions, even 
where the present method has grown up beside it. 

The present method is by the transfer 
Fnfdsnafffing of a written "deed", of which a copy is 
o V f£cu>$/er. enC9 usua Uy registered at the chief town of the 
county. Certain statutes to guard against 
frauds (the principal one of which, generally known as 
the "Statute of Frauds", was passed in the reign of 
Charles II.) provide that contracts relating to real estate, 



7° 



The Protection of Rights. 



[§826 



and certain other things which we will consider later 
(198), must be in writing, tho now in many states, 
statute permits a verbal lease for a year, and sometimes 
longer. Usually, now, when two parties have agreed on 
a sale of real estate, they at once put their agreement in 
writing — generally by filling out and signing a printed 
form that the lawyers' experience has led the stationers 
to prepare, and the purchaser generally pays something 
on account, which will be forfeited if he does not carry 
out the contract. 

You may wonder what we have to do with a law 
passed in England under Charles II. We were gener- 
ally governed by the English laws until the Revolution; 
and when we dissolved our connection with Great 
Britain, each state enacted that the previous laws of 
England should prevail within its borders, when not 
in conflict with laws made by its own authorities. All 
later states have so enacted, but Louisiana, which is 
still under much of the law she received from France. 

To return: part -payment is often supposed necessary 
to make a written contract valid, but it is not: for, 
as we saw, under the Statute of Frauds writing alone 
makes the contract valid, if it is valid in other respects 
which we will consider later. 

82 (0). Contracts The written contract of sale usually 
of8ai: recites that in consideration * of blank 

dollars paid to A by B, A agrees to sell, and B agrees to 
buy, a piece of land described; that the price shall be 
blank dollars, so much payable on the signing of this 
contract, so much on the delivery of the deed at some 
specified time and place, and (if there are any deferred 
payments) so much at other times specified, the deferred 
payments to be secured by a mortgage (83). 
82 <d) Deeds ^ deed is any instrument sealed as well 
" *' as signed. This does not mean sealed up: 
in old times before men generally — especially the great 
fighting characters who owned most of the property, 

* There may be other considerations, and it might be worth 
the reader's while to anticipate the order of statement by reading 
regarding them in Section 179 ff. 



§ 8a f] Law of Real Property. 



7i 



knew how to write their names, it was the custom to 
authenticate written instruments by putting on a 
seal after words declaring that the instrument was 
the parties' free act and deed; and even after it became 
general to sign the name, on specially formal instru- 
ments it remained customary to put the seal also, and the 
name "deed" was retained for all instruments under 
seal, tho in popular use it generally means a conveyance 
of land. 

92(e). 8001 and Generally the seal need not be an im- 
tu effect. pression of some device peculiar to the 

grantor, and on some impressible substance: in most 
of the states, any spot of some adhesive substance will 
do; and in many of the states a mere scrawl of the 
pen, with the word "seal" written in it, is enough; 
or perhaps even without that word, if the position and 
nature of the scrawl make its purpose plain. 

An instrument under seal has distinctions other than 
in name, from one not under seal. Where an instru- 
ment is under seal, the court takes it for granted that 
the price or other consideration (1 79-181) was fair — the 
grantee need not prove that it was, and the grantor 
is not permitted to disprove it, unless mistake or fraud 
is alleged. 

Moreover, a person can claim damages under a con- 
tract under seal, till some time fixed by statute — in 
most states twenty years, has elapsed, while under 
other contracts, six years is the usual limit. (See also 
82 m, 190.) 

Not all deeds convey an interest in land : instruments 
for other purposes are often put under seal. 
82 (fi E^entiais The laws regarding deeds vary in differ- 
of deeda. en £ states, but usually the points essential 

in a deed of real estate are that.it name the grantor and 
the grantee, preferably with the town, village or city 
of the residence of each, clearly describe the property, 
name the consideration for the transfer, clearly state 
that the land is transferred to the grantee to be held 
by him, and it often has been decided by the courts that 
unless property is conveyed to the grantee and his 



72 



The Protection of Rights. 



[§82/ 



heirs, only a life-estate is conveyed. Moreover, a deed, 
in order to be recorded (which, as we shall see hereafter, 
is important) must be witnessed by a notary — that is, 
must contain a notary's certificate that the signature 
was acknowledged before him; and if it is not to be 
recorded in the county where the notary acts, his signa- 
ture must be attested by a certificate from the clerk 
of the county. 

82 (g). Dower and One other point is necessary if the 
Courtesy. grantor is married. In many of the states, 

if a married male grantor dies, his widow would have an 
interest for her life (called her dower), in one third of 
the property, unless she has relinquished it in the deed; 
tho in a few states, this interest cannot exist in any 
realty but the homestead, and such other realty as 
the husband may die possessed of. The latter policy 
seems the better, as the necessity of having the*wife 
join in every deed given by her husband, is seldom of 
any real value to her, and often involves much trouble 
and delay, when she is ill or away from home, and the 
custom is also in restraint of trade. 

On the other hand, in some of the states, the old 
law still exists that if the grantor is a married woman 
and should die, and if she had had a child by her surviv- 
ing husband, unless he had joined in the deed he would 
be entitled to the use of the property for life — called the 
courtesy of it. 

82 (hi value of While the steps already recited are the 
established only ones necessary to a deed, others are 
* orm9 ' desirable. Questions regarding deeds have 

been coming before the courts for hundreds of years, 
and lawyers have been shaping the expression of deeds 
so as to prevent such questions arising after the trans- 
action : so it is very well to follow forms that experience 
has approved. Yet there have been many embarrass- 
ments regarding this: the lawyers have gradually 
loaded up forms of deeds with so many provisions and 
so many legal phrases, that common patience could 
not read them, or mere common sense understand 
them. This experience is by no means restricted to 



§82 t] 



Law of Real Property. 



13 



deeds. The whole business world knows it. Business 
men who habitually make written contracts for any 
specific purpose, and often print them, find that* new 
features keep arising in the course of experience, which 
they try to provide for in subsequent contracts. The 
number of these provisions often so swells the printed 
forms, that a fresh start with simple ones is found de- 
sirable, even at the risk of leaving some contingencies 
to be settled when they arise. 

To remedy this unwieldy growth of legal forms, the 
most progressive states have provided by legislative 
statute, brief and simple forms for both deeds and 
mortgages. 

But their use is probably not imperative anywhere, 
but only recommended and given the full sanction of 
the law ; yet timid people who want to provide in 
advance for everything that never happens, can make 
their instruments as labored as they please. 
82 Oh Registry, Real-estate sales are usually completed 
mi9-mrch. some weeks after the contract is made, be- 
cause delivery and possession cannot be as simple as with 
personal property, and it takes time to arrange for them. 
If a man has a piece of personal property in his posses- 
sion, and delivers it to you for a consideration, the law 
will not go back of that delivery for any reason except 
the property's being stolen. But a small portion of the 
world's real estate is in plain possession of anybody — 
a man driving with you in the country, or even stand- 
ing with you in a portion of the city, could easily say: 
"This property is mine," and sell it to you, when it 
was really somebody's else, or mortgaged to some- 
body, or burdened with some other rights of somebody. 
Consequently, in early times, as writing became gen- 
eral, records were made of the ownership of property. 
They began, in our race, with William the Conqueror's 
Domesday Book. As our country was settled, each 
commonwealth parceled out the land among the people, 
and gave them deeds, which were put on record (or 
registered — the terms are used interchangeably), usu- 
ally in the county where the land is situated. Each 



74 



The Protection of Rights. 



[§ 82 i 



transfer since has been recorded. When any important 
contract affecting land is made, the grantee, if he has 
ordinary sense, has the records searched to find if the 
title is good — that is, if his grantor has a good deed 
from a chain of persons who had good deeds back to 
the first grant by the state. He or his lawyer also 
looks into the record of mortgages, taxes, and other 
serious burdens on property, to see if the property 
in question is free from them, and writes to the clerks 
of all the courts in the county, to see if they have 
any unsatisfied judgments. 

82 (J)- Judgments. A judgment in this sense is a decree 
of a court, usually against a loser in a suit, 
which is put on record, and which makes the property 
of the person against whom it is issued, liable for the 
sum decreed by the court. 

The principal Statute of Limitations was 
ofSlmitatto?" passed in the reign of Charles I., and the 
Ap^rtenaneis. effect of it on real estate, in nearly all cases, 
unless modified by later statute , is to prevent 
any claim taking effect unless it is urged within twenty 
years of any adverse holder taking possession. After 
anybody has held land unopposed for twenty years, the 
law presumes that he had a grant of which evidence 
has been lost. So if the title is found clear for twenty 
years, it is often considered a good risk (72). 

When a right has been used without dispute for the 
time required by the statutes of limitations in the state 
where the land is situated, it becomes a right by pre- 
scription. Then the right becomes legal, even if it 
covers the ownership of the property. Such rights, 
however, are often for privileges less than those of 
ownership, and are then called appurtenances (92). 
They sometimes may so encumber land — for instance, 
by preventing building in certain spots, as to be seri- 
ous clouds on title. 

82 Oh 77t/«/n- You can insure against a bad title, just 
gurano: as y OU can against a fire, but the com- 

pany generally first hunts up the title, for its own sake, 
tho the older companies have searched titles of so 



§ 82 m] Law of Real Property. 



75 



many pieces of land that they often have to search 
only back to the time of some recent search, besides, 
of course, making inquiries regarding judgments (82/) 
to the clerks of the courts. 

Unless the title is insured, so many questions are apt 
to come up, that usually a good lawyer is needed to 
make the search, and if there is a cloud on the title, 
82 (m). cioud* on either the trade is called off, and the 
m *- earnest-money returned, with interest, or 

the parties agree to keep the trade open for some fixed 
time, in the hope of paying off incumbrances or other- 
wise clearing the title. 

This second agreement, for delay, should be in writing, 
tho, there being one written agreement already, the 
courts would probably wink at a reasonable delay in 
making another, as some time would be needed to settle 
its conditions. 

As the adjournment of passing the title is probably 
for the mutual convenience, the mutuality would gen- 
erally be deemed a consideration, tho the general view 
is that the original consideration holds over for the 
adjournment. 

If the title is found all clear of outside claims, on 
the appointed day, the grantor gives the grantee a 
deed. 

If the deed is delivered subject to conditions not 
expressed in it, such as the performance of some act 
by the grantee before the deed can take effect, the 
conditions are ineffective. All the provisions of an 
instrument under seal take effect upon delivery. Tho 
one not under seal can be effectively delivered subject 
to any lawful conditions, such as to take effect on a 
certain day if certain prices rule, or even if the weather 
is fit for certain operations. The only way to make 
limiting conditions effective in an instrument under 
seal, is to put them in the instrument itself, or to leave 
it with a third party, to be delivered only when the 
conditions are fulfilled. This is called putting it "in 
escrow" — reducing it to the condition, for the time 
being, of a mere " scroll " or memorandum. 



7 6 



The Protection of Rights. 



[§ 82 » 



82 (ni Deifoery of If the grantor dies before the deed is 
dB9d - given to the grantee or to somebody else 
for him, the deed takes no effect, but the proposed 
grantee can call upon the heirs to give him a new 
deed, and if he does not get it, he has a good claim on 
the estate for any money that he may have paid in 
advance. 

83 Mort a es ^ mortgage is a right to sell a piece of 

gages. property, real or personal, if the owner 
of it (the mortgagor) does not, by a certain time, pay 
a debt due the person holding the right (the mortgagee). 

Originally all of the proceeds of such a sale belonged 
to the mortgagee, but now the excess, if any, above 
the loan with interest and expenses, belongs to the 
mortgagor. 

The form of a mortgage does not usually differ from 
that of a deed, until near the end. Originally a mort- 
gage was made by simply handing over a deed, with an 
agreement that the land could be redeemed on paying 
the borrowed money ; and even now the mortgage con- 
veys the property just like a deed, and then provides 
that the mortgagor can have the property back if 
he pays the debt named in a certain bond (or perhaps 
only promissory note) which accompanies the mortgage. 
01 /id ^ The difference between a bond and a 

83 (a). Bonds. . . . - - . A 

promissory note is that a bond is under 
seal (82 d) and may hold its maker to the performance 
of some other act than the payment of money, tho it 
always provides for the payment of some value in case 
of non -performance. A promissory note, on the other 
hand, is not under seal, and never promises anything 
but the payment of money at a specified time. 

The right to redeem the property under mortgage is 
called the equity of redemption 

Before accepting a mortgage, it is worth while to 
be sure of a good title, just as before taking a deed: 
if there are any previous mortgages or judgments, they 
have to be satisfied before the new mortgage takes 
effect, and the mortgagee should see that all taxes 
levied previous to the mortgage, and during its life, 



§8 5 ] 



Law of Real Property. 



77 



are paid by the mortgagor: for they must be paid before 
the mortgage can be paid. 

A lease is a right to use real estate for 

. eases. a ^ ven or asce rtainable time, generally 
conditioned on the payment of rent. 

The same precautions of form and search accompany 
a lease, as a deed or mortgage, except as the interest 
is smaller. 

A deed or mortgage or lease being made out in proper 
form, signed, sealed and delivered, the transaction is 
closed as between the parties, but not as between 
85. Rlirhts of third tnem anc * outsiders. As regards those 
parties regarding without other notice, a piece of land be- 
re * lstry ' longs to the person in whose name it is 

registered, and if A, after giving a deed of it to B, were 
to sell or mortgage it to C, and C, without knowledge of 
the existence of B's deed, were to get his instrument re- 
corded before B, it would be good against B's earlier 
instrument not recorded ; but record is notice to every- 
body. The time of record is drawn so finely that on 
any recorded instrument, the county register always 
endorses the minute of the hour of the day he receives 
it, and it is considered as recorded that minute. 

If C gets on record first, giving him the property 
would not ordinarily be unfair to B who had paid his 
money first, because if B, by neglecting to record his 
instrument, had left room for C to suppose that A was 
still the owner, it would be B's fault that C had parted 
with his money to A; and so if either B or C is to 
suffer, plainly it should be B. There is a general 
maxim of the law (79) governing such cases, to the 
effect that: *'The law helps those who are wide awake, 
not those who are dozing" * — in this case, it helps the 
man who gets on record first, not the one who goes to 
sleep over his deed. 

Yet creditors could not seize the property of A if they 
had given him credit supposing the land was his, while 
B held an unrecorded deed of it, always provided that 



* Vigilantibus, non dormientibus , subveniunt jures. 



78 



The Protection of Rights. 



[§86 



A » r ~ * «r a all parties had acted honestly and could 
86. Effect of Friud. r> x j j j a 

prove it. But an unrecorded deed or 

mortgage always is subject to suspicion of fraudulent 
intent to make the grantor or mortgagor still appear 
to own the land, and so keep a better aspect on his 
credit than it really deserves; and this suspicion of 
fraud might be very readily accepted in court if later 
creditors tried to get hold of the land on the ground of 
fraud in the unrecorded deed or mortgage. 
87 Land differs Even such a formal instrument as a 
from negotiable deed can be set aside on the ground of 
papers> fraud, and so can any instrument or con- 

tract whatever, except in a few rare cases where a 
title to negotiable paper (a bill of exchange, bank 
check, or promissory note) has passed on to an innocent 
holder. Exception is made in some such cases, 
because it has been found better to run the risk of an 
occasional fraud than to choke the avenues of commerce 
by impeding the rapid transfer of such instruments. 
Transfers of land and even of merchandise do not 
occur with such frequency and rapidity. 
AO T.,kni M i mMB ^ mav be worth while to know a pecu- 

88. Technical mean- . . . ; P , , , r 

In -of "Estate" in liar legal use of the word estate . The 
Land ' lawyers use the term "estate in land" to 

signify the quantity and quality of an interest. For 
instance, a mortgagor and mortgagee and a lessee may 
each have an estate in the same piece of land, so may a 
widow have a dower estate, or a widower a courtesy 
estate, and perhaps a creditor may have a judgment, all 
in respect to the same piece of land. The largest pos- 
sible estate is called a fee simple — when the land belongs 
to a man and his heirs or assigns forever. The person 
holding that can carve out all the lesser estates from 
it if he sees fit. Sometimes he carves out so many that 
the fee simple is worth less than nothing — for instance, 
he may give a mortgage for more than his estate is 
worth, or even let taxes accumulate against it until 
they amount to more than the fee is worth. 

The estate of a lessee is technically called in the law, 
an estate for a year, or from year to year, or for 



§ 89 a] Law of Real Property. 



79 



years. An estate for a single year or 
Mmfw^m. ^ rom vear to vear » hardly carries the same 
rights as an estate for years, but usage 
varies a good deal in the different states. Generally 
the rights, so far as not specified, would be inferred 
from the length of the term. A long term would imply 
the tenant's right to make material changes; while in a 
short term, the tenant could not make material changes, 
and would not be apt to, tho he would generally have 
a right to proper use of wood, and to gather a crop that 
he had planted, even if it were not ripe when his estate 
terminated; tho if his estate were for a single year, he 
would not be apt to plant one that would mature too 
late. A lessee has a right to use the estate as his own, 
unless he is restricted in the lease. Otherwise he may 
use woods and mines, gather crops, remove and alter 
buildings, and construct new ones, tho of course if 
his lease is very short, he would not naturally do all 
these things. Yet he cannot destroy a wood entirely, 
but may use only what fuel or timber can reasonably 
be spared from it. Nor can he destroy anything else 
so as materially to lessen the value of the property. If 
he did, he would "commit waste", as the lawyers call it, 
which would subject him to paying damages, and might 
forfeit his lease. 

If he puts up a new building, he cannot claim its value 
when his interest terminates, unless by agreement with 
the owner of the fee — the landlord. 
89 (a) Repairs ^ e l anc *lord neec * not make repairs unless 

a ' 9 r *' so stipulated. Otherwise the tenant must 
make enough repairs to return the property in as 
good condition as he received it, "ordinary wear and 
tear excepted". 

The tenant need not repair after a fire unless he 
wants to, but he must continue to pay rent, unless 
otherwise agreed. There is generally a special agree- 
ment, however, that the landlord shall repair unless 
reconstruction is necessary, in which case the lease shall 
come to an end. 

The lessee can transfer his interest to another tenant, 



8o 



The Protection of Rights. 



[§896 



oo unless the contrary is stipulated, tho 

83 oy. Subletting. , , . ir ^ r ' 

he still himself remains liable to the 
landlord. If the tenant does not pass on the money 
to the landlord, the landlord can eject the subtenant, 
but if the subtenant wishes, he can guard against that 
by paying the landlord direct. 

89 (a. Terminable If a tenant for a year continues on into 
ity, notice. a se cond year without anything being said, 
he can continue for the whole of it, and must if the 
landlord wishes. To prevent that, notice must be given, 
under the old rule, six months before the end of the 
year; now, generally three months, tho people are not 
very particular as to the exact day or week. 

An estate for a month follows the same general rules 
as an estate for a year. 

90. Rights under The rights of an estate for years belong 
life estate. a i so to an estate for life — either for the 
tenant's life or for the life of another person. In the 
latter case, if the tenant die before the other person, 
the other person would not enter into possession, but 
the tenant's heirs, or anybody appointed in his will, 
would enjoy the estate during the life on which it was 
conditioned. 

In addition to the estates already mentioned, there 
are estates terminable at the pleasure of either party — 

91. Under estates called estates at will, which carry hardly 
a 1 * 111, any privileges but occupancy. There are 
some other infrequent estates that it takes something 
of a lawyer to understand. 

Besides the various recognized estates, 
. ppu enances. ^ere are certain privileges sometimes at- 
taching to land, either by grant or prescription (82 k), 
and going with it when it is transferred, even without 
being named more specifically than under the general 
title of "appurtenances." They are generally in the 
nature of rights over neighboring land, such as rights 
to pass or carry pipes or wires over it, or to take wood 
or game or fish from it, rights of way, of drawing water, 
and of "antient light" — Tight not to be obstructed by 
building (abolished by statute in New York and some 



§92 c] 



Law of Real Property. 



81 



other states) ; and among appurtenances are also gen- 
erally included rights to use party walls, and rights 
over adjoining highways and waters. These rights 
generally 4 'go with the land", as the air and sunlight 
do, tho for safety's sake, grants should generally name 
the land and its appurtenances. 

Appurtenances very often accrue by prescription, 
especially rights to "antient light", rights of way, and 
of drawing water. 

92(a). Party*** walls arc yeT Y frequent in cities 

' where a few inches in the width of a 
room may be valuable. A person building puts half 
his wall on the land of an adjoining neighbor, under 
agreement that the neighbor may insert his beams on 
the wall and use his side of it. Usually a price is 
agreed upon for this, which should be looked up in 
searching title, as the conditions, if registered, follow 
the land, whether expressed in the latest deed or not. 
The adjoining owner need not always pay: for he 
may be so uncertain whether he will want a wall of 
just the character proposed, that while he is willing, 
on the chances, to have the wall partly on his land, he 
will take no farther risk. Yet, for the sake of gaining 
space, the builder may be very glad to put it there 
without any compensation for its use. Neither side 
can tear it down without the consent of the other, but 
either can add in any way that does not damage the 
other. 

92 (b). Land beside When land abuts on roads in built-up 
roada - districts, the road sometimes belongs to 

the municipality, but in rural regions generally, the 
owner on each side owns to the middle, and is entitled 
to anything growing on his side. The public have right 
of passage over the road, but only so long as they 
keep it in passable condition. If it is not properly 
kept up as a road, the use of it reverts to the owners. 
92(o. Land by Regarding streams, each riparian owner 
water. m owns to the middle, and unless the stream 

is navigable, the riparian owner has the sole right to 
fish in it opposite his bank. Regarding an owner 



82 



The Protection of Rights. 



[§ 9*c 



on a bay miles wide, or on the borders of the sea, the 
laws of different states vary very much. In Maine and 
Massachusetts, for instance, a riparian owner on tide- 
water holds to average low-water mark. But in New 
York, on the other hand, he owns only to the ordi- 
nary high -water mark; the state owns from there for 
three miles out — as far as a cannon would carry at the 
time the right was determined; and beyond that, the 
sea is everybody's. 

As to rights to bathe from the shore of any water, and 
to land on it, nobody has a right on another's land; 
so of course the question cannot arise at all where the 
law is as in Maine and Massachusetts; and where the 
law is as in New York, the question can arise only 
regarding the space between high and low water, which 
belongs to the state. The state often grants control 
to the riparian owner. Otherwise the rights so far as 
fixed at all, largely rest on local custom, and are not 
yet generally clearly determined by courts or legisla- 
tion. Ordinarily, whoever pleases will go on the strip 
after shell-fish, tho he cannot cross another's land to 
do it, but must go by boat from some place where he 
has a right to keep a boat. 

Wharves for shipping, in some states, are generally 
owned by municipalities, and some wharf privileges 
are sold or leased to private parties for permanent use, 
while some are retained for the general benefit, usually 
on the payment of fees. In other states, as the riparian 
owners control to low-water mark, landing and wharf 
privileges generally spring from private titles. On the 
great lakes, the 44 navigable stream " rules prevail, not the 
tide-water rules, the riparian owner owning to the middle, 
but the public having the right to navigate and fish. 

The casual landings of people boating for pleasure, or 
merely touching to land a passenger or a package, are 
not generally taken account of; and along shores and 
banks generally, if the privacy of owners is not unrea- 
sonably disturbed, they are not apt to object to others' 
landing. If they do object, the rights are the same as if 
the trespasser had come by land. 



§ 93] Law of Real Property. 



83 



93. Restriction,. A . *. £ &Ti eStEte * S &™ te f sub j^t to con- 
ditions or restrictions of any kind — such 
as not building on certain portions, or not carrying on 
offensive trades, or using only for dwellings, or a limited 
number of dwellings, the restrictions follow it during 
the whole estate originally granted, even if the estate 
be a fee simple; and the records should be searched 
for such restrictions, just as for mortgages, judgments 
or any other encumbrances. Restrictions can lapse 
under the Statute of Limitations (82 k) as even the 
ownership itself can, if somebody successfully acts 
counter to it for twenty years. So, if somebody acts 
counter to a restriction, for twenty years, without any- 
body attempting to enforce the restriction, nobody can 
enforce it thereafter. There are exceptions, but we 
have not space to go into them: of all products of the 
human mind, the Law is the most immense and the 
most complicated — so complicated that there is probably 
no rule without exceptions. That is one reason why 
a person should be very slow to act in a serious matter 
without the advice of a good lawyer. 

Now that we have some notion of the complexities 
of interests in land, it is natural to inquire whether 
it seems inevitable that transfers of them must involve 
so much delay, trouble, expense and risk of bad title; 
and it is pleasant to know that, just as the cumbrous 
forms which deeds had reached have been remedied, 
so remedies have been found for the other cumbrous 
usages. But the remedies have not yet been universally 
adopted, because usages which have been evolved 
through such a long past, have their roots tangled up 
in so many things, that it is hard to eradicate them with- 
out wide disturbance. In some places, some proposed 
land reforms cannot be adopted without amending 
constitutions. Moreover, social affairs generally are 
so complicated that before any comprehensive measure 
is tried, it is hard to tell how it is going to work. There 
is no more certain mark of folly than a glib cocksure 
plan to remedy a social difficulty. Wise people are very 
slow to substitute innovations for evolutions. Yet we 



84 



The Protection of Rights. 



[§93 



must not stick in the mud for lack of trying to get out. 
94. TheTorrens The best method of land transfer yet 
System. suggested, appears, on the whole, to be 

what is known, from its originator, as the Torrens 
System. It was first used in Australia in 1856, then 
spread into the neighboring British possessions, into 
British America, and into Great Britain itself, and has 
lately been enacted in Illinois, Ohio, Massachusetts, 
and (for some counties) Minnesota.* 

Its principal objects are to save the delay and expense 
of frequent searches of titles, and the losses from uncer- 
tain or imperfect titles. This is effected by granting 
certificates of title under the guarantee of the state. 

Different states arrange different details, but the 
proceedings are something like this: any person claim- 
ing an estate in a piece of land (at least the absolute 
ownership, — a fee simple: the minor estates are not 
always directly provided for, but are indirectly), can 
go to the proper authorities (they vary in different 
states), asking for a certificate of his title. The officers 
search the records, and make out a description of the 
title as it then appears, stating in whom the fee stands, 
and in whom stand any claims, such as dower, mortgages, 
judgments, estates for life or years, etc. Then they 
issue notice by advertisement to all persons claiming 
any rights in the estate, and by mail to all whose addresses 
are known, calling upon them to present statements of 
their rights within a given time. At the end of that 
time, they judge all these rights, and complete their 
statement of. the title according to the rights which 
they consider established. If anybody contests any of 
their judgments, the case is given to a court, from whose 
decision lies a right of appeal to a higher court, whose 
decree is final ; and then a certificate of title embracing 
all the rights is recorded. The certificate may state that 
an unencumbered fee simple rests in one individual ; or 
the certificate may vary so far as to indicate a fee vesting 

* The first enactments in Illinois and Ohio did not fit the 
constitutions of those states. In Illinois a second enactment 
has been made which promises success. 



[§94 



Law of Real Property. 



85 



in several persons, and a variety of rights vesting in 
several other persons. But such as it is, the certificate 
states the authoritative title of the property, which 
can never again be questioned. Duplicates of the cer- 
tificate are given to persons having rights in the property. 

The chief advantages of these certificates are that 
while under previous usage, if anybody wants to sell 
any rights he may have in a piece of real estate, or 
pledge them for a loan, the title has to be searched, at 
an expense of money which may be greater than a loan 
will justify, and at an expense of time which may lead 
to his bankruptcy before the value of his rights can be 
ascertained; but with the modern certificate, he can 
show his rights at a glance, and an expert can appraise 
their value very quickly. Moreover they are guaranteed 
by the state, and therefore not open to any question, as 
rights in real estate under the usual registry system 
always are. 

If the officers make some mistake which does injustice, 
the Massachusetts plan is that the title, as certified, 
cannot be questioned (except, of course, for fraud), 
but if anybody can prove himself wronged without any 
fault or carelessness of his own, he is made good through 
an insurance fund which is accumulated from a trifling 
percentage (one-tenth of one per cent.) of the value of 
each piece of property certified, which is paid when 
the certificate is granted, and also whenever the prop- 
erty passes by descent or will. 

The expenses of searching title and preparing the 
certificates do not come out of the general taxes: so 
people who own no land do not have to pay them for 
the benefit of those who do; charges are made for 
preparing the certificates, but they are generally no more 
than that of an ordinary search of title, and they are paid 
once for all ; while under the old system, as much gener- 
ally has to be paid every time a piece of property is sold 
or mortgaged — sometimes a dozen times a year. 

In Massachusetts, the holder of any certificate whose 
interest is less than the fee, is prevented from raising 
money fraudulently, by having a mortgagee's duplicate 



86 



The Protection of Rights. 



so stamped; and when the mortgage is paid, it is given 
up and stamped * r canceled". A similar arrangement 
can be made, of course, when certificates are issued to 
holders of other interests, tho there are not always 
provisions for such issue. 

But as a title good to-day may not be good to-mor- 
row, sales and encumbrances coming after the certificate 
is issued are effected by just the same documents as 
before, only the first principle, of course, is that no 
change in the rights to the land takes effect before it 
is recorded in the certificate and its duplicates. Where 
ownership of the fee is changed, a new certificate is 
issued, and the old one stamped "canceled To use 
an imperfect certificate with intent to defraud, is made 
subject to heavy penalties, and anybody purposing to 
accept a certificate can compare it with the original at 
the recorder's office in a few minutes, for a trifling fee, 
instead of waiting a month to get the title searched, 
and incurring heavy expenses. 

Titles by prescription (82 k) cannot be obtained under 
the Torrens system (in Massachusetts, at least) against 
a title that has been certified under this system, which 
seems, on the whole, a just provision, tho it may well 
be questioned. 

In states adopting the new system, getting a register of 
property under it, is made voluntary, and interested 
persons generally apply for certificates only when they 
sell or mortgage, or grant estates for years. Thus 
the labor is spread over time enough to make it quite 
practicable. 

If mortgages, leases, etc., should make the certificate 
of an active piece of property, unwieldy, there seems 
nothing to prevent \he owner applying for a new cer- 
tificate with all the dead changes left out, and simply 
showing in whom the rights vest at date. 



CHAPTER VIII. 



PERSONAL PROPERTY. 

Evolution of Rights in It. 

Having traced the evolution, protection and transfer 
of rights to Property in Land, we come to treat in 
detail of the similar features of the Personal Property 
developed out of the land. In our first summary (51, 
51 a) we found the agencies that develop personal prop- 
erty to be Land, Labor and Ability. 

Labor generally means effort of any unattractive 
kind, but here I mean the work of a man's body. 

When we were speaking of the monkey picking the 
fruit, we called the third factor "intelligence", but 
" intelligence' ' is not broad enough to cover the ground: 
judgment, knowledge, forethought patience, honesty 
and a host of other qualities are needed now, and we 
sum them up under the name of Ability. 

The differences in men are so marked, then, as to 
divide them into two classes — men without much ability, 
who perform the manual labor, and men with great 
ability, who tell the others what labor to perform. 
Under such a classification, as under others in all sciences, 
the divisions overlap somewhat, but they will do very 
well for our purpose, if we bear in mind two of the 
particulars in which the classification falls short. 
95. Product varies The first is that many laboring men, tho 
whh ability, guided more or less by the ability of other 

87 



88 



The Protection of Rights. 



[§95 



men, have ability of their own. Tho a common laborer 
has usually but little ability, and shows it by getting 
only a dollar a day, an average mechanic has much 
more ability, and shows it by getting two or three dol- 
lars a day ; while a small number of mechanics of con- 
siderable ability, get as high as even ten or twenty 
dollars a day. 

As Mr. John A. Hill said in his notable circular to 
his men (reprinted in The World's Work for February, 
1906) during the printing strike: "Those of you who 
know me, know that I am inclined to pay more than 
the scale to good men, or grant them other privileges 
that amount to the same thing." 

An illustration of what labor guided by its own 
ability, can do, was afforded in the truckmen's strike 
in New Haven in 1903, when some thirty Yale stu- 
dents took the places of the strikers, as a lark. They 
were found, despite their inexperience, to do more 
loading and unloading than twice as many truckmen. 
But men of such ability do not remain truckmen, but 
are soon guiding the labors of other men. 

In successful businesses, the workmen are nearly 
always under the guidance of men of vastly greater 
ability, who get many times as much as the workmen. 

The second qualification to bear in mind if we treat 
the industrial world as divided into men of labor and 
men of ability, is that, in England at least, the laborers 
are fast learning to be their own guides. Cooperative 
industries carried on by the workers themselves, made 
wonderful progress during the latter part of the nine- 
teenth century. 

The rewards of ability vary much more than those 
of manual labor. When you yet up into the ability 
that can guide the labor of others, men vary much 
more than they do when the ability is only enough to 
guide one's own labor; and in the long run, the re- 
wards vary somewhat with relation to the ability, tho 
the men of the very greatest inventive ability, like the 
creators of the steam-engine, the telegraph, the power 
loom, the cotton-gin, the reaping-machine, and other 



§9S«] 



Personal Property. 



89 



great inventions, who influence the labor of nations 
and generations, never reap a tithe of their own pro- 
duction; while on the other hand men of administra- 
tive ability, like Stewart and Vanderbilt, whose work 
is mainly in handling other men, and whose work lives 
but little longer than they do (except in their families' 
fortunes) reap a much larger proportion of their pro- 
duction. 

Practically, a man's ability is determined by the 
value of what he produces; and in the long run, despite 
the poor pay of some of the inventors, most men are 
paid accordingly. 

MM A: s ^ kin ^. P roof ? f £ ow w * ge * Y ai 7 

product of tit* with ability, is given in Brassey s Work 

toutt Laborer,. ^ Wages » He says that he found wages 

the world over regulated by the amount of ability; he 
got the same labor for the same amount of money in 
one part of the world as in another. If he paid ten 
cents a day in India, it took ten men to accomplish 
the results that it took one to accomplish in countries 
where he paid a dollar a day. In May, 1905, the 
manager of the Corbin estate in Greenville, Miss., 
reported that in cotton he could make $5 with Italian 
labor where he could make $1 with negro. 

The difference did not lie in muscular strength. Even 
in mere picking or shoveling, a man of ability will accom- 
plish more than a man of much less ability and more 
strength: it is more a matter of ability than of 
strength — of intelligence in work, including energy and 
faithfulness, which are considerable elements of ability. 

We shall find, as we go on, that false reasoning, 
especially regarding convict labor and protective tariffs, 
is often based on a false assumption that a day's work 
is the same thing from one wage-earner as from another, 
in one country as in another, and at one price as at 
another: so we may as well consider some more illus- 
trations of the utter falsity of any such ideas. In 
Canada, Brassey found English labor at 5s. 6d. cheaper 
than Irish at 3s. 6d.; in England, 3s. 6d. cheaper than 
is. 6d. in Ireland, or than 5d. in India. In a stone- 



90 



The Protection of Rights. 



[§ 95 « 



quarry in France, he paid Englishmen 6 francs a day, 
Irishmen 4, and Frenchmen 3, and found the English- 
men the* cheapest of the lot. General Walker * says 
that the English cotton-spinner is paid twelve times as 
much as the East-Indian, and yet undersells him in 
his own market; that an English weaver tends two 
or three times as many looms as a Russian, and that 
the English looms run faster. Brassey says that three 
English railway navvies do the work of five French 
ones. It is universally known that American laborers 
surpass those of the rest of the world in efficiency — 
strength, intelligence, and saving, as much as they 
do in pay. In France it takes forty-two men to do 
the work at an iron-furnace, that in England is done 
by twenty-five. English farmers on the shores of the 
Hellespont prefer to give Greeks £10 a year rather 
than give Turks £3 . Women in English cotton-factories 
get about 13s. a week, while French, German and 
Belgian women get about 8, and Russians about 2 J; 
and the English labor is the cheapest. In different 
parts of England itself, agricultural wages varied from 
9s. per week to 16s., and the 16s. laborers were the 
cheapest. Mr. Atkinson says ("Facts and Figures ") : 
"With one dollar's worth of labor . . . here with 
labor-saving machinery, we can buy the day's hand- 
work ... of Russia, Italy and Asia." 

In view of such startling facts, no wonder that 
there is a constant conflict between Labor and Ability, 

* Political Economy. Advanced Course. General Walker's 
"The Wages Question", Chapter III, should be read on this 
and collateral topics. 

General Walker farther quotes various authorities to the 
following effect: an English wood-sawyer will do the work 
of thirty-two East-Indian ones. He gets but about eight 
times the pay. An English laborer does and receives about 
twice as much as an Irish one. Tho provisions are cheaper 
in Russia than in England, it costs six to eight times as much 
to mow an acre of hay in Russia as in England. It takes 
twice as many hands to do most kinds of factory work in 
France and Germany as in England. In Belgium a handprints 
from one hundred and sixteen to three hundred pieces of cloth 
a day, in England the average is one thousand. 



§97 a 1 



Personal Property. 



9i 



96 Difflc It of es P ec i a Uy as many even claim that the 
tdjurtingftljrhts men who do the hand-work make every- 
MdUbor b thing and ought to have everything. Let 

us, then, try to ascertain how the respec- 
tive property rights of Labor and Ability are 
evolved. It is plain enough how Labor increases pro- 
duction, but outside of the ability of the individual 
laborer, it is not so plain where Ability first begins to 
increase it. That most important step takes place 
wherever one man wisely tells another what to do. A 
97. General common laborer cannot dig a ditch straight 
Functions of without a person of superior ability to 
Ability show him how; or he can't go into a wood 

and chop down the trees that ought to be taken, with- 
out somebody of superior ability to mark them for 
him — he cannot even remember them unless they are 
marked, but will chop down the wrong ones.* 

Such a laborer is but the primitive man, 
fzJ^memf^M 1 " tho evolved up to a certain disadvan- 
Mefwdence. ta & e * ^he sava g e man * s generally able 

to get his food from hunting and fish- 
ing, and to make his simple clothes and shelter. But 
the so-called civilized man, especially in villages and 
cities, has not generally the woods and streams to resort 
to, and is not accustomed, like the savages, to make 
his own raiment and dwelling. Therefore, as a rule, 
the moderately evolved man, unless a higher evolved 
man initiates an enterprise and gives him a chance 
to take part in it, cannot get his own food, clothing 
and shelter, and is unable to find anything to do. 
The man of only average ability, if he is out of a job, 
does not get another, before the man of more than 
average ability offers him one. Until then he is apt to 
sit down and fold his hands, and complain that he has 
not tools and material, and could not find a customer 

* The author once took an excellent woodchopper into 
some pleasure-grounds and pointed out a dead tree to be cut 
down. Near it stood a beautiful live one. After the employer's 
back was turned, the chopper cut the live one and left the dead 
one standing. 



9a 



The Protection of Rights, [§ 97 a 



if he had, etc., etc. And for all this, he blames the rest 
of mankind: not himself and Iris maker. But another 
type of man, tho vastly rarer, goes and puts in the 
first load of coal he finds lying on the sidewalk, or 
shovels off the first bit of snow he finds unremoved, or 
in summer mows the first lawn that needs it, or takes 
some other of the thousand jobs lying around for some- 
body to do. This man, however, is soon an enterpriser, 
while the other man is always a wage-earner, and 
blames the enterpriser for it. It would be well if 
everybody should read Sill's little poem "Opportunity " 
and B tinner's little story "Zadoc Pine". Both are 
admirable and enjoyable as pieces of literature, and as 
instructive as they are delightful. 

9Kb). Things mater ial thing made by man is 

made to embody simply the embodiment of an idea. The 
thoughts. value of the thing depends mainly on the 

value of the idea; and as industries have advanced, the 
ideas have more and more been contributed by excep- 
tional men, and embodied by ordinary men. 

There is hardly a thing made for wages, from pins to 
palaces, that is not simply a putting into form, by 
many men, of ideas furnished by a few. Everything 
turned out in the factory is of a shape and size that 
somebody else tells the laborers to make. The laborers 
on every railroad are simply building a line laid out, 
in direction, grades, width, material, by somebody else; 
building stations located and designed by somebody 
else; making locomotives and cars designed by some- 
body else with wonderful ingenuities and conveniences 
invented by somebody else; and when the road is 
finished, running trains at hours and rates of speed 
devised by somebody else. 

Take away the few men of ability, and none of these 
things could exist; take away an equal number of 
laborers, and the things would exist all the same. 
97 (o. Averages Now ability is rare. There is a law 
and Aunty. Q f na ture, first brought prominently for- 
ward in regard to human relations by Galton, that of 
a given number of things of the same kind, the most 



§97*1 



Personal Property. 



93 



will cluster around the average, and become rarer as 
they depart from the average. So it is with men: 
of a hundred, probably eighty will have ability enough 
to produce only the equivalent of the minimum wages 
— for comparison's sake, say a dollar a day; ten out 
of the hundred can produce, say, two dollars; four, 
four dollars; three, ten dollars; two, twenty dollars; 
and possibly one, fifty dollars. If you want to find a 
hundred-dollar-a-day man, you will probably have to 
look into a group of a thousand men; to find a Van- 
derbilt, you will need a generation; for a Watt or an 
Edison, a century; for a Euclid or a Newton, ten or 
twenty centuries; and for an Aristotle or a Spencer, 
half of human experience. 

Galton represents the facts graphically by a target 
where the shots are naturally thickest at the center, and 
scattering toward the edges. For our purpose, the 
representation would be better by a horizontal band 
of dots, with the dots thickest along the space represent- 
ing the average, half way from the top to the bottom 
of the band, and growing thinner toward the upper 
and lower edges. Then a few should be scattered above, 
to indicate men of special ability; and a few below, to 
indicate men of special stupidity. 

97(d). The lower Now the men below the average of 
depends on the ability have done their best only under 
higher, ^ e guidance of the men above it. The 

workmen have needed their foremen, the foremen have 
needed their employers, the employers have needed 
the Watts and Edisons, the Watts and Edisons have 
needed the Euclids and Newtons, and the Euclids and 
Newtons have, unconsciously perhaps, needed the whole 
environment of thought shaped by an Aristotle or (to 
shift the matter more toward the future) by a Spencer. 

And it is not well to forget, as an essential of even 
material well-being, the moral atmosphere created by 
a Gautama, or a Christ. 

But to come back to our daily experience. 
97 (e). "Finds In the higher walks of industry, the man 
WQrk -" of ability finds the work for other men to 



94 



The Protection of Rights. 



[§97« 



do : they go to him for work, and unless he 1 ' gives work ' \ 
they remain among "the unemployed". 
97 (f). increaata He increases product by organizing men 
product. G f comparatively little ability so that they 

can produce what is wanted, and produce more of it, 
carry more and exchange more than they could if left 
to themselves. He decides what enterprises will pay, 
undertakes them, gets together the capital for them, 
and often invents machinery and industrial processes. 
97(g). Saoea He effects economies, often, if he is a 

waste. man f sufficient ability, by abandoning 

enterprises before they run at a loss. Moreover, as 
Labor, unless guided by Ability, either on the laborer's 
own part or that of his manager, is simply the mere 
physical effort of the animal or the savage, it is apt to 
be wasteful, and often destroys more than it produces. 
In most cases, unless the superintendent of the laborers 
has enough ability to set them making the proper 
things, the proper way, they produce less than nothing, 
by spoiling material and producing articles that will 
not sell for what they cost. The 4 4 bargain-stores' ' con- 
tain many things not worth as much as the materials 
and wear of tools (not to count the labor) that it took to 
make them. On the other hand, Labor guided by Abil- 
ity makes nearly everything it touches worth more than 
it was before. 

The man of ability, however, generally does more than 
conduct the processes ; he generally organizes the enter- 
prise from the beginning. Because he undertakes the en* 
terprise, he has sometimes been called the undertaker, 
and some people who do not like that word have taken 
a French equivalent, entrepreneur, but English is good 
enough for us, and we will henceforth call him the enter- 
priser, as probably has been done more than once already. 
98. Detailed Func- As already intimated, the enterpriser 
tlons of Ability. has first to decide what enterprise will pay; 
and that is the most difficult task of all. A market may 
reach to the remotest corners of the world, or may be 
restricted to a fastidious class in a few great cities, or 
may depend on unaccountable shifts of fashion, or on a 



§99] 



Personal Property. 



95 



million mysterious causes : yet the enterpriser must know 
98 (a). Prophtsy- what the market wants, and how much. 
inqwanu. No other man, perhaps, so needs the 

genius of the prophet. It is no wonder that only one 
man in thousands has it to any marked degree. 
98 (b). Raising After the prophet has determined what 
capital. to do, unless he has enough money of his 

own (which is seldom the case, in the industries so big as 
to supply us most cheaply) he must get other people to 
put in their money. The capacity to find them and to 
make them trust him, is one great and rare element of 
Ability. 

98 (eh At the Next, if he wants a factory, he has to 
work8 ' decide on the building and machinery that 

will pay, and see them well and economically constructed ; 
to buy the material in the best market and at the most 
favorable time, sometimes getting credit if he thinks 
it wise to buy more than he has money to pay for at 
the time; to get together the men, using great judgment 
of human nature in getting honest and capable foremen 
and accountants; to see that the men are properly 
organized, as already explained (and he has, by the 
way, to keep this in mind in getting up his factory 
and machinery) ; then he has to manage the men and 
their strikes and labor-union troubles. 
98 (d). Outside of Outside of his works, he must determine 
tns works. from day to day just what styles of his 
product are apt to strike the coming tastes and fashions, 
and when and of what kinds to make big lots and 
small ones; to make his product known by wise and 
economical advertising; to find the best market for it, 
both in time and place; to know whom to trust and 
whom to press for money, and how to keep his trade; 
and then he has to collect the money. All this time 
he has to see to his accounts and taxes, and if he can, 
occasionally get a little time to eat and sleep and 
recreate himself. 

Such is the view generally entertained by 
o?tho 0| krlterprlser. competent people, of what the enterpriser 
has to do. The view generally entertained 



9 6 



The Protection of Rights. 



by other people, however, is that, as he seldom soils his 
hands, or uses any tool but a pen, he has nothing to do, 
but is a mere drone living on money that really belongs 
to the people who do the hand-work. Because the 
captain of industry does not actually use a tool, any more 
than a military leader actually uses a weapon, most of 
the people who cheered Dewey on his return from 
Manila are ready to say that a captain of industry is 
entitled to none of the results, because the work is all 
done by his men. The truth is that they would have 
been as powerless without him, as a fleet without its 
Dewey, or an army without its Grant. 
100. Division of The most noticeable process by which the 
,abor ' enterpriser increases and cheapens pro- 

duction is by the effective division of labor. In mak- 
ing almost anything, there are a good many processes. 
If one man performs them all, he will not be as skilful 
in any one of them — as able to do that one nearly as 
often in an hour, or as well, as if he practises that one 
alone. Besides, if he effects a dozen, he will lose time 
in changing from one to another. Hence it is a great 
aid to production, to have a factory big enough to 
have separate men for separate processes. But if 
there are a dozen processes, that does not necessarily 
mean a dozen men: some processes would take more 
time than others, so the man doing the quick ones 
would need more men doing the others, to keep up 
with him; or possibly in a small factory it would be 
cheaper to have some man do more than one process: 
that would of course depend upon the size of the fac- 
tory, and it would also depend on the ability of the 
manager: unless he decided wisely how to portion out 
the work, he would have too many men for one process, 
and too few for another, and so throw everybody's 
work out of gear. If the men decide this themselves, 
each man would want to do what he liked best, and 
he could not know as much about the other men's work, 
and what the material and the total result aimed at 
would require, as a man whose business it should be, 
while doing nothing special himself, to watch it all, 



Personal Property. 



97 



and rqake all work together. Even where workmen 
have owned an establishment together, they have had 
to make a leader and obey him, and generally to pay 
him more than any of the workmen got (118). When 

101. Few men can comes to watching it all, there are few 
conduct large men that have the ability, even if they 
enterprises. could have the opportunity: most men 
who try management make a botch of it (120). As a 
matter of fact, of the men who try to perform the duties 
of the enterpriser, the vast majority fail.* 

The general reason that very few men are fit to 
conduct a large business, while so many men con- 
duct small ones, seems to be that for a large business, 
the preparations have to be made for months — some- 
times years, ahead. The little businesses that buy 
from the large ones, can buy from one day to the next, 
and need only take from day to day, or even from 
hour to hour, what they see that people want. More- 
over, as a large business cannot have the enterpriser's 
eye everywhere at once, he must leave much of the 
supervision to lieutenants who themselves have ability ; 
and the capacity to search out and select good lieuten- 
ants is rare, especially in combination with the other 
rare powers that an -enterpriser needs. 

102. Ability out- What has been said in regard to organiz- 
slde of tangible ing factories — producing tangible goods, ap- 
p ct plies equally to organizing stores and rail- 
roads and steamships and hotels and all other forms of 
industry. It used to be a jocose way of describing a 
man of little ability, to say: 41 He can't keep a hotel." 
Unless there were men who could organize something 
bigger than a stage-coach, we should have to go in 

* Mr. Joseph H. Walker of Worcester, Mass., lately found 
on investigation that of every hundred men in business in that 

Elace in 1845, sixty-seven were out in i860. Out of seventy- 
ve manufacturers in 1850, only thirty left business with any 
property, and only six of the sons of the seventy-five had any 
property. In 1 860 there were one hundred and seven manu- 
facturers, and only sixty left business with property. There 
had not been time for many deaths: so failures are the only 
explanation. (Wells, "Recent Economic Changes.") 



9 8 



The Protection of Rights. 



[§ ioa 



stage-coaches; unless there were men who could or- 
ganize something bigger than a sloop, we should have 
to go in sloops; unless there were men who could or- 
ganize the big shops, we should have to run all over 
the cities to get what we want from a variety of little 
ones, and then should not have as wide an assortment 
to choose from, or be able to get what we could find, 
at as low a price. 

103 "The Great * n stores an( * railroads, etc., where 
Industr"' cheap- there cannot be much division of labor, 
ens product. ^ e cheapening is effected by making the 
industries large: in most industries, the more you do 
of a thing, the cheaper you can do it. A bookkeeper 
can make a figure 9 as cheaply as he can make a 
figure 1 ; a wheelbarrow can carry a bushel of potatoes 
as cheaply as it can carry one ; a locomotive can take 
a dozen cars in a train as cheaply as one; a man of 
ability can turn out or handle a thousand pieces of 
goods easier than a man of no ability can turn out or 
handle one. Stewart, the first great shopkeeper in 
New York, as compared with all previous shopkeepers, 
is said to have saved the people who shopped with 
him ten per cent. Commodore Vanderbilt, by cheapen- 
ing freights from the grain-raising and flour-milling 
regions of the West, is estimated to have saved every 
man on the seaboard a dollar on each barrel of flour 
that he bought. 

104. Enterpriser's Th ^ fortunes of men of ability are 
Income not at ex- usually only a small portion of what they 
pense of Labor. create and gave {qt Qther people If the 

inventor of the steam-engine were alive and could have 
half that he has saved for and bestowed on other people, 
probably no one country in the world would be rich 
enough to pay what all countries together owe him. 

105. invention and Let us look into this matter of inven- 
Evoiution. tions a little more closely: we shall have 
to refer to it more than once. What do we really mean 
by 4 4 the inventor of the steam-engine"? The fact is 
that no one man ever invented any great thing. The 
word inventor is generally used in any particular country. 



§ io6] 



Personal Property. 



99 



for the last man in that country who took the last im- 
portant step in the evolution of any great invention. 
When you try to find out who invented the steam-engine 
or the telegraph, for instance, from a book — especially a 
schoolbook designed to teach patriotism, if it is an 
English book, you will be apt to find the credit given 
to an Englishman ; if a French book, to a Frenchman ; 
if a German book, to a German; and so on. The 
explanation is not so much that patriotism goes wide 
of the truth, as that, in each process, so many elements 
enter, that it has taken a long time to evolve them; and 
that during this long time, the whole civilized world 
has learned about them, and people in all countries 
were apt to take the final step at about the same time 
— or rather a variety of steps which accomplish the 
result. 

But whether we call each important apparatus giv- 
ing us the control over the powers of Nature an evolu- 
tion or an invention, it is the product of ability. 
106. Labor abounds Now which produces most of the wealth 
In poorest countries. f the world, Nature, Labor or Ability? 
Generally Nature holds out more wealth to the poorest 
savages than to the richest people on earth, because the 
wealth of the savage's country is yet untouched; but 
the savage has not the ability to develop it. Labor is 
more abundant amid the famines of China and India 
than amid the wealth of Europe and America, but the 
Chinese and Indians have not the ability to guide it. 
So, as places with the most natural wealth and the most 
labor are the poorest, and those with the most ability, 
even tho their natural wealth be partly used up, are 
the richest, the difference between the rich peoples and 
the poor ones must depend upon ability. 

From the point of view of civilization, then, the 
men who make inventions and organize industry 
secure us all that we have in advance of the people 
whose industries are small. If there were no great 
inventors and organizers of industry, the civilized world 
would have to go backward to the condition of people 
like the Chinese and East-Indians, who have little inven- 



IOO 



The Protection of Rights. 



[§106 



tion or organized industry, and the world would have 
to stay there until men of ability should arise. 

But tho our discussion must deal principally with the 
agencies which give all men, in proportion to their 
means, the largest variety of utilities at the lowest 
price, I should be very sorry to be understood as claim- 
ing that result as alone constituting civilization. The 
civilizations of Greece and Japan show us much to 
desire, and yet they have been characterized by a noble 
simplicity that suggests the question whether our greater 
number of appliances may not divert too much of our 
attention from more important things. 

107. The enter- Now we come to a hard question, 
prfser must nay When the product is sold, is it at all'cer- 
good wages. tain that the enterprisers will give the 

employees their correct share? In other words, are 
wages generally fair? Of course the share is generally 
given before the collection is made — a lump sum is 
agreed upon. There is no way of making each man's 
sum exactly equal to his share in production; but in 
the long run, wages must reach an average that is fair, 
and probably more than fair: the able laborer gets 
more than the unable one everywhere (95 a). 

The reason is not only that men of ability so increase 
the product that they can afford to pay more than the 
laborers would produce alone, but because all men so 
much prefer to be employers rather than employed, 
that they will pay all they can afford, and more, rather 
than be driven out of doing business for themselves. 
Therefore, except in times of unusual depression, there 
are employers actually bidding more for labor than they 
can really get back from it. They can bid high because 
men of little ability are constantly saving or inheriting or 
borrowing capital. This they fritter away in bidding 
for labor to conduct enterprises that are beyond them. 
Yet while men of little ability pay more for labor than 
they can make it worth, men of great ability can make 
it worth more, and therefore, in average circum- 
stances, bid it up in competition with each other to 



Personal Property. 



101 



the point where they are left only a reasonable 
profit. 

But in times of depression, when there 
HoiSi**?*** are not as rnany jobs as there are men, 
men who need places often take work 
for really less than they produce; yet probably not 
oftener than employers pay more than the market will 
return, rather than shut down. 

So much for the services that an enterpriser, when 
he has ability enough to succeed, renders to the com- 
munity and to his workmen. Now if he pays his men 
108. Where a ^ t ^ iev P r °duce, or more, of course he 
Ability's reward can get his reward only out of product 
does come from. that WQuld nQt exist unless hig ab y ity 

called it into being. True, he does not make or even 
handle a thing with his own hands, but he enables other 
men to make or handle two, or perhaps a hundred 
and two, where they could otherwise handle only one. 
He gets his reward by making more things with a given 
amount of plant, labor and material. Moreover, where 
there is a big supply, things are always cheaper than 
where there is a scant supply. 

But Vanderbilt and Stewart did not make things, 
yet in one sense they did make things-in-New-York 
that otherwise would have been things-in-Minnesota, or 
things-in-Belfast. There is a difference in value between 
a thing-in-New-York and a ching-in-Minnesota. If 
there are more barrels of flour in Minnesota than people 
want, and not as many in New York as people want, 
people in New York will give more for them than people 
in Minnesota. The man who carries them, adds to 
their value, and if he carries them cheaply, people in 
New York can afford to pay him a profit for carrying 
them. So with linen between Belfast and New York, 
and in short with all articles moved by commerce. 

It is a very prevalent fallacy that those 

I2t 'Jby hud! who do not affect the mechanical or chem- 
ical qualities of an article, "produce noth- 
ing". This is but an extension of the fallacy that the 
enterpriser produces nothing, because he does not put 



102 



The Protection of Rights. 



[§ 109 



his hands to his product. The value of an article 
depends upon its capacity to satisfy a need: so every 
man who touches an article toward placing it where 
it is more needed, must add to its value — must really 
"produce" the added value. So of course to a still 
greater extent, must a man who organizes transporta- 
tion and exchange. 

To go a step farther, the bankers and promoters who 
finance these agencies, add to the value of the articles 
handled; and to take other steps, so do the govern- 
ments which regulate all finance and industry; so do 
the armies and navies which defend the country; and 
now, to take it to a higher issue, so do the thinkers 
and writers who promulgate the correct mechanical and 
economic principles on which roads, machinery, vessels 
and warehouses should be built; and farm- 
Sfi^S^mlS. in S' minin S» manufacturing, transporta- 
tion, exchange, banking, promoting, gov- 
erning, and fighting be conducted. Still another step : 
the promulgation of incorrect principles of finance and 
taxation probably destroys more value than earth- 
quakes, eruptions and wars. The silver agitation about 
1890 was estimated by David A. Wells to have de- 
stroyed values to the extent of a thousand million 
dollars, and the greenback currency of the civil war 
probably destroyed as much, and we shall see farther 
evidences of destruction, when we come to consider 
taxation. 

To take a step higher still: economic 
on 1 so\. a nd e mo3S? d and political principles and moral prin- 
ciples shade into each other, and are often 
identical; so, for that matter, do mechanical principles 
and moral principles: 4 4 an honest job" is a phrase of 
very wide and just application. It ought to be easy 
then to realize that the promulgators of sound morals 
and the inspirers of good conduct — the good preachers 
and orators and writers, also create value in material 
things — probably more value than all other classes of 
men put together. Probably if all that has been accom- 
plished in the world by Christ, Confucius and Gautama, 



§112] 



Personal Property. 



not to speak of Aristotle, Bacon and Spencer, could be 
blotted out to-morrow, much the greater part of the 
value in material things would be destroyed. An ade- 
quate explanation of how this would come about, would 
carry us farther afield than this treatise can go; but 
some hints that will help the competent student to work 
the matter out for himself, have already been given, 
and if he will keep the subject in mind, he will find it 
full of such hints. Some very specific ones are given 
in paragraphs 330-330(6). He can start now with the 
reflection that with the current morality swept away, 
his own pocketbook and the coat on his back would be 
vastly less safe, and therefore vastly less valuable, the 
next time he leaves his study, and even while he reads 
this in his study. 

It hardly need be said that the pay of 
dteWbuffon. xeS ° f the various contributors to the value of 
goods is very unevenly distributed, and 
one is sometimes tempted to believe that those who 
contribute most, get least. Certainly the august beings 
who rule the centuries from their tombs, knew little 
material splendor; and certainly the men at the other 
extreme who can do nothing but what they are told, 
and do that poorly, get a share of the good things of 
life, which, tho small, is larger than their own production 
— vastly larger than they could get if left to themselves. 

And paradoxical as it seems, and in illustration of the 
old saw that extremes meet, is the fact that in recent 
times, the other portion of the business world that has 
been notoriously getting more than its share of produc- 
tion, is at the other end of the line — not the enterprisers 
who are immediately associated with labor — not the 
"captains of industry " at the factories and stores or 
even on the great public works like the railroads and 
steamship lines, but those who determine what great 
public enterprises are needed, and gather up the scattered 
units of capital from all over the country or all over 
the financial world, into masses big enough for the great 
enterprises — the promoters of the railways and trusts — 
the bankers and the officers of the great insurance com- 



104 



The Protection of Rights. 



[§ 112 



panies and other financial corporations. In their prin- 
cipal developments, the functions of these collectors of 
the general capital are comparatively new, and are not 
yet well regulated by competition or by law, or even 
by public opinion, which is just now in a state of hysterics 
over them. It has therefore been easy for the men 
conducting these functions to take heavy toll on the 
money of other people passing through their hands. A 
heavy toll is legitimate, for the ability exercised is great; 
but that ability is too often devoted to making the toll 
unduly great. 

113. Paradoxes of The subject, however, is now prominently 
opinion. before public opinion and the law, and 

reasonable regulation must in time be secured — secured 
probably long before reasonable regulation will be 
secured for the striking, boycotting, rioting, burning, 
murdering brute who thinks that because his hands 
follow the dictate of other men's brains, he makes 
everything and is entitled to everything; and assumes 
that his right to stop work is a right to conspire with 
others to stop together, and force others to stop with 
them, and so paralyze the activities on which the 
welfare of all depends — of himself more than the others, 
if he but had the wit to see it. 



114. Why returns ^ow we reac ^ t ^ ie verv serious question 
of fabor are nearly of how it comes that the laborer seldom 
xedi gets anything above the current rate of 

wages, while the enterpriser and promoter may get 
hundreds or thousands of dollars a day. The reason 
is that things which can be found anywhere, like staple 
products or common labor, are always offered for sale 
in lively competition, and so the price is driven down 
to pretty near the cost of production. Mere manual 
labor of the pick and shovel is found anywhere, and 
can live on cheap fcod and lodging: therefore its cost 
is low. The more intelligent labor of the high-class 
mechanic, needs a nervous system kept well by good 
food, sleep and shelter, informed by some education, 
and recreated by some amusement. These things cost 



§ 1 1 5] Personal Property. 105 

more money than the coarse laborer's living, and are not 
as generally to be found: so the mechanic gets higher 
wages than the mere digger; and the high-class mechanic 
gets higher wages than the low-class one. Neverthe- 
less, there are enough mechanics of nearly all grades to 
make competition among them active (despite the 
regulation of their trade-unions), and so, of course, their 
labor is kept at a recognized, tho somewhat fluctuating, 
market price. 

Now while all this shows why Labor is 
Ability vary wfdefy. restricted to its regular wages, how is it, 
' when we get into entirely different con- 
ditions, with the irregular and often enormous profits 
of Ability? Ability is scarce: it generally does not 
compete for employment, but employs itself; hence 
there is no price fixed for it. Whenever it does accept 
wages — as in the case of special mechanics, electricians, 
chemists, etc., or upper clerks, managers, presidents of 
companies, etc., the salary is a matter of special arrange- 
ment, and generally is accompanied by an interest in 
profits besides, not to speak of the St. Valentine's Day 
check of Si 00,000, from the New York Metropolitan 
Street Railway to Mr. Vreeland, its president. 

What determines this varying and sometimes enor- 
mous factor of profits, is that as wages and raw material 
have a current market price, a given amount of them 
being paid for by different men of ability, they will 
get out different amounts of product, varying in propor- 
tion to the different amounts of ability of the enter- 
prisers ; and these will produce and market this product 
at different rates of expense for plant, office expenses, 
interest on capital, freight, advertising, drumming, col- 
lecting bad debts, etc., etc. They will all have to sell 
at pretty nearly the same price: that being fixed by 
those having least talent for making good .sales and 
holding out for high prices. The others will have to come 
down very near to that price to get a market ; or some- 
times, tho seldom, an able man may even go below the 
current price for the sake of broadening his market. But 
however the price may be fixed, the profits of each enter- 



io6 Tlie Protection of Rights. 



[§"5 



priser will be the difference between his price and the cost 
of producing and marketing. That difference may be 
on the wrong side for those who produce least with a 
given amount of wages and raw material, and are most 
extravagant in office expenses, advertising, freight, etc. 
Those who exercise most ability in these particulars, 
will of course have the most profit. That profit may be 
enormously increased if the ability is of the very excep- 
tional kind that generally anticipates the course of the 
market, and buys material and holds on to product 
before a rise, and sells before a fall. 
116. Capital's return . T he capitalist, instead of being the re- 
more like Labor's cipient of the lion s share, as he is com- 
than Ability's. mon ly held to be, generally is that, only so 
far as he is both capitalist and enterpriser. Otherwise, 
he is only about on a par with the wage-earner. Capital 
is everywhere, and there is a market rate for it, just 
as for wages, tho as it does not generally need its in- 
come from week to week, it is more apt to take chances 
at a share of the profits than the laborer is : the laborer 
nearly always (tho not always — not in fisheries, for in- 
stance) commutes his share for a fixed sum regularly 
paid. 

As the laborer and the capitalist are so nearly in 
the same boat, the unending talk of the conflict between 
capital and labor is mainly a survival of words from 
old conditions. In the early days of the great industry, 
the capitalist and the enterpriser were generally the 
same man; but even then, the struggle for shares of 
product was really with him as an enterpriser rather 
than as a capitalist. Nowadays when the enterpriser 
is so generally merely an officer of a corporation, in 
which his share may be little or nothing, and when 
he is apt to be a mere borrower of all or most of his 
capital, capital's share of product is nearly as fixed as 
labor's, and the enterpriser is really the person struggling 
to see how much he can realize after paying both. 

The conflict, then, so far as there is any conflict, is 
between Ability on one side, and Capital and Labor 
on the other, when the enterpriser is not at peace 



Personal Property. 



with capital by owning most of it himself. 
5Ltoti2Sfwd BBOt But it is the cheapest sort of nonsense to 
iabw*or * kl1 ,n * c ^ Si ^ m that * n our men °^ high ability 
or or cap . wagte their time in trying to grind the 

face of either capital or labor: able heads are apt to 
be too full of making money, to bother themselves 
much with petty means of saving it. The pettifogging 
is carried on by a lower type of man ; altho the wisest 
men make mistakes, and all men, rich as well as poor, 
and poor as well as rich, see their own side too exclu- 
sively. 

118 Caoitai and is often supposed that if the laborers 

labor powerless themselves owned the factory, or the store, 
without Ability. of the steamboat, and all in them, they 
could then get along without the Man of Ability. But 
in the first place, they very seldom do own the estab- 
lishment; and where, by saving up and putting their 
money together, they have owned it, they have always 
failed, unless the born Man of Ability arose among 
them. Then the born Man of Ability has generally in 
time got his share of the product; and until very lately 
(126), he has generally ended as the owner of the con- 
cern. 

And he has not stolen it: without him, the thing has 
generally soon been shut up. But where he has taken 
hold, he has enabled the men to produce enough to 
pay their wages, and sometimes more; and what was 
over, was of course fairly his own production. 

Outside of a few cooperative establish- 
dlvision? rateS ° f m ents carried on by very exceptional work- 
ingmen, men without a manager have not 
produced enough to pay their wages. It seems to fol- 
low, then, that when an exceptional establishment does 
pay, the production above ordinary wages, is pre- 
sumably the manager's. Karl Marx and his school 
say that the manager gets this production and more 
too. The modern school says that he gets less. Mal- 
lock says that the workmen produce five thirteenths of 
the output, and get paid for seven thirteenths. Sound 
economists agree with his general position, tho he alone 



108 The Protection of Rights. [§119 

is responsible for his figures. But this does not mean 
that if the enterpriser gets six thirteenths of what is 
produced — that if every day he were paying seven 
hundred men three dollars apiece, he would get eighteen 
hundred dollars a day to each man's three dollars. It 
means that the six thirteenths have to pay not only 
profits, but taxes, insurance, rent, interest on borrowed 
capital, and dividends to stockholders, if there are any. 

120. Enterprisers As a matt ^ r of fact, what the enterpriser 
generally get less generally gets out of the six thirteenths, is 
than nothing. something less than nothing at all— he gen- 
erally uses up all the money that has been put in the 
business, and fails (101). The wage-earners get their 
share first, and next the other claimants — landlord, sup- 
pliers of machinery, fuel, raw material and merchandise, 
and lenders of money — get what they can, and if there 
is anything left (which in most cases there is not), the 
enterpriser gets it. 

But to the casual observer of the business world, all 
this will read like nonsense. He will naturally ask: If 
the money embarked in business is generally lost — if 
ninety-nine enterprisers in a hundred lack the ability 
to succeed, how can large industries be carried on at 
all? They are carried on by the one man in a hundred, 
or the one in a thousand. Until an enterpriser has 
proved himself, people will not trust him with much 
capital. So before much is lost by incapable managers, 
they fail — competition weeds them out and returns them 
to the ranks, while the capable ones survive to conduct 
the large industries. 

121. Handworkers We have spoken so far mainly of Ability 
of special Ability. as guiding mechanics or others who 
handle material things. Let us stop a moment to con- 
sider other men of ability who work with their muscles. 
Artists, musicians, public performers of all kinds, work 
with their muscles, and sometimes those of great Ability 
make thousands of dollars an hour. "Goods" are not 
all of them mere material things: art, literature and 
science are among the highest goods, and people pay high 
for them, when of best quality, whether in music, books, 



§123] Personal Property. 109 

pictures, statues and beautiful houses, or fees to doctors, 
lawyers and engineers. 

122. Property not Property, then, is not only in tangible 
all tangible. things : some of the most valuable proper- 
ties are in mere rights, such as the rights to make and 
sell patented inventions and (tho seldom of equal value) 
copyrighted books, music and pictures. Some other 
examples of mere rights that have a money value, are 
that at the great fairs, the rights to keep restaurants, 
rent out rolling chairs, sell papers, candy, and even 
peanuts, are sold for large sums. So often are rights 
to put down railways, even before a tool has been used 
in the work. 

Of course, to exercise ability and reap its rewards, a 
man need not necessarily either guide hands, his own 
or others', in producing or handling material things. 
Not to speak of inventors, the lawyers and statesmen 
regulate productive industry, and so add to production. 
We might liken the world to steam machinery. The 
steam-power — the engine, is labor; machines — like looms 
and cotton-gins, are the ability that makes the power 
useful ; and the lawyers and statesmen are the governors 
and fly-wheels. So far as they see that justice is done, 
that taxes are wise and government good, they keep 
things running easily and smoothly — the power from 
being wasted, and the machines from going too slow, or 
so fast as to tear themselves to pieces. 

123. Comoaratlve There seems to be a general impression, 
©refits in different but it is a doubtful one, that business men 
fields of Ability. of ability— who control material things, 
are as a rule richer than the surgeons, and artists, and 
lawyers, and statesmen. It is certainly doubtful 
whether they are, in proportion to their numbers; many 
doctors and lawyers are rich, but there are a great many 
more men in business, and therefore a great many more 
rich ones, and of the comparatively few men in the 
fine arts and the other professions, by no means all 
have much ability, any more than have men in business. 

Whether as a question of causes, or as one of natural 
justice, there are certainly few questions more interest- 



no 



The Protection of Rights. 



[§ 124 



ing than why a few men have most all the ability, and 
therefore most all the property, while 
havi great AWllty. most men have very little of either; and 
it is but a superficial answer to say that it 
is probably for the same reason that a few horses have 
all the speed and beauty : for we do not know the answer 
much better regarding the horses than regarding the 
men. The causes are all a question of evolution, not 
very well worked out yet. 

The truths we have been considering about the shares 
of the various producers, have not long been understood. 

125. Discovery of The bottom ones were first clearly stated 
the foregoing in General Walker s Political Economy , 
* in 1874, and since then they have been 
followed up and expanded, particularly by Professor 
Marshall and Mr. Mallock. It used to be believed that 
what the enterpriser got, he got by having control of 
the tools and materials, the store, the railroad, the 
steamboat, and forcing his men to let him keep a part 
of what they really produced or exchanged. 

126. Ability The Man of Ability is certainly appear- 
Increasing. m g oftener than he used to. A new state 
of affairs is growing up in England. At last workmen 
are putting their money together and enterprising their 
own industries, and are rapidly developing so much 
ability that they can manage themselves through direct- 
ors elected by themselves. Of course they cannot all 
be bosses, but they are capable of directing sufficiently 
to prevent having to depend entirely on any one or 
two men; and the rank and file are developing sense 
enough to help their leaders instead of hindering them, 
as has been too often the case before. 

127. Suum That men who are mere machines — who 
culque. do not economize production, have any 
just title to profits from economized production — that 
men who take no part in organization, have any just 
claim in the profits from organization, are both prop- 
ositions which, however desirable the advance of such 
men's lots may be, are too absurd to promote such an 
advance, or any other good thing. But such descrip- 



§128] 



Personal Property. 



in 



tions of limited function m do not apply accurately to 
many men, and ought not to apply to any. As already 
intimated, there is ability in varying amount, among 
men who are directed by larger ability ; and the ability 
of men under direction can be stimulated and increased. 
Moreover, it is plain that ability, little or big, should 
have its little or big share of profits. 
, 00 Ml , A rough and limited justice in this re- 

128. Minimum , . ° , , , J , 

wage and slid- gard is already reached by wages varying 
Ing scale. somewhat with the productiveness of em- 

ployees, but the justice is very rough and very limited. 
Various schemes have been tried to improve it. Among 
them have been sliding scales of wages, varying with 
the profits of the business. A minimum wage (272 d, 
276) is of course a necessary feature of this: for the men 
cannot be expected to have any reserves to fall back 
upon if the business pays no profits, and moreover, in 
many such cases, they go on producing in their way, 
and are entitled to their production. If the enter- 
priser cannot make money out of it, that is his risk — 
a risk he often takes for the sake of his men, when, in 
a sense, it is no risk at all, but a dead certainty against 
him. Nevertheless, in average cases, an enterpriser 
sets his men to making product, from the expectation 
that he will make a profit on it, and there can be no 
question that so far as labor goes into that product, 
the product belongs to labor, and labor is entitled to 
the value from it which was commuted as wages. Hence 
a minimum wage, with an advance varying with profits, 
is a clearly logical scheme, at least so far as concerns 
the minimum. As concerns the advance, it is logical 
so far as profits are contributed to by advanced energy, 
carefulness and economy on the part of the workmen; 
but it is not logical so far — and that is the main dis- 
tance^ — as the profits depend upon initiative, organizing 
ability, prophetic sense, study of the market, and finan- 
ciering ability — all on the part of the employer. As soon 
as a workman shows any appreciable amount of these 
rare elements of ability, the question of a sliding scale 
of wages will have brief interest for him : his employers 



112 



The Protection of Rights. 



[§128 



will be only too glad to use him in some higher place 
where such questions do not arise, or he will himself 
be able to put himself there. It would appear, then, 
that the portion of profits which can reasonably be 
devoted to a rising scale of wages, beyond the amount 
to which the wage-earner is entitled anyhow, cannot 
be a very large one. 

129. No lack of ^ n tne various schemes for making the 
opportunity. whole establishment a vast partnership, it 
will not do to lose sight of the same principles. As 
the man of ability is a rare product of Nature, and 
as any considerable business is fated to destruction 
without him, and as he must provide his weaker 
brethren with their wages, and bear whatever losses 
may arise in so doing, whatever profits come out 
of the concern (and as said before, comparatively few 
men who essay the task, bring out any) are logically 
his, except in the small degree that his men may be 
able to contribute his kind of virtues. The difficulty 
of their contributing them is not only in the rarity 
of such virtues, but in some small degree, as business is 
inevitably organized, in opportunity. But how rela- 
tively small that lack of opportunity is, can be realized 
only by those who, like the writer of these lines, have 
been for many years anxiously watching among a group 
of subordinates for the slightest gleam of business 
capacity, and on finding it, in one man in scores, eagerly 
setting it to fitting work; and this at least as much 
from selfish motives as from desire to give another his 
due chance. 

The minimum wage and. the small share in profits 
(and none in losses) being then the best present chance 
of the man who lacks the ability to rise beyond wage- 
earning, and that chance being distributed with an 
approach to uniformity that but very roughly recog- 
nizes differences in capacity, what can be done to give 
the wage-earner a better chance? Whatever can be 

done, he will do most of himself. Gen- 
to embrace e it. ab,e er3L ^Y ne w ^ do nothing beyond furnishing 

an equivalent, more or less adequate, for 



§i3i] 



Personal Property. 



113 



his wages, and will finish his life as he began it. As 
the world is now organized, sometimes he will show 
enough ability to attract the attention of his superiors, 
and will be welcomed to such higher functions in the 
establishment as he is able to perform — perhaps its 
headship. Sometimes he will save his money, and 
start a little industry of his own. In this he will gen- 
erally fail, and revert to the ranks. In rare cases he 
will succeed, and furnish opportunities to make a living 
to some who cannot make opportunities for them- 
selves. In rarer cases, he will furnish enough such 
opportunities, and exercise enough capacity in shaping 
and handling the results, as to make himself rich, 
whereupon all those for whom he has provided the 
opportunities, will say that he has got rich by robbing 
them. Or finally, by becoming a cooperator, our wage- 
earner may get the benefit of whatever ability may be 
in him, and may rise without incurring jealousy. But 
success in producing has so far attended very few 
cooperative experiments before they had ceased to be 
cooperative, and had come under the ownership of 
men of ability. Yet more men of ability appear to 
be developing from the ranks, and the ability of the 
ranks themselves seems increasing. 

As to the question of natural justice already alluded 
to — does it seem right that because one man is born 

very able, and another, who may be a 
ofVortune^ght^ better man at heart, is not very able, the 

first should be prosperous, and the second 
poor? That depends upon what we mean by " right 
and that again depends upon what we are using the 
word for. If we are using it for our hands, the right 
hand is the one most people can use best ; if we are talk- 
ing about a right line, it means one that goes direct 
from point to point; if a clergyman speaks of a right 
action, he means such a one as his church would approve ; 
a lawyer means by a right, something that the govern- 
ment, or the law, will or should secure to a man; and a 
philosopher would mean, an act for the greatest good 
of the greatest number, or he might mean an act in 



ii4 



The Protection of Rights. 



[§131 



accord with Nature's laws. The fortunes of Peabody, 
Cooper, Vanderbilt and Stewart are certainly in accord 
with Nature's laws, and therefore in this sense must be 
"right". As to the greatest good of the greatest 
number, probably few would question regarding Pea- 
body's and Cooper's; and certainly Vanderbilt's and 
Stewart's resulted from work which "the greatest 
number" could well afford to pay the fortunes for, if 
they had had to. But they did not have to: for, as 
we have seen, the fortunes would not have existed but 
for the savings effected for the community, part of 
which savings made the fortunes of the enterprisers. 

Admitting, then, that wealth honestly acquired is 
right, especially when used as Peabody and Cooper used 
theirs, is the corresponding poverty right too? 

Well, if "corresponding poverty" means that the 
majority of mankind is poor because the minority is 
rich, there is no "corresponding poverty": men of 
ability while making their own fortunes, improve those 
of their employees and of the whole community, in- 
stead of diminishing them. 

We often find things in accord with Nature's laws 
that seem not for the greatest good of the greatest 
number, but even to our finite vision, investigation 
generally shows that they only seem so. 
132. Evils have True, Nature is a hard mother to the 
their uses. ineffective man. She starves him, freezes 

him, often kills him, unless the effective man guides 
him or saves him by charity. She fills the world with 
beauty and opportunity ; but so far, she has evolved 
few who care for the beauty, and fewer still who can 
seize the opportunity. Harder still, perhaps, she even 
takes away from the ineffective man most of anything 
he may have, and passes it around, unless it is wasted, 
until it reaches the hands of the effective man. Truer 
words were never spoken than: "Unto every one that 
hath, shall be given, and he shall have abundance; but 
from him that hath not, shall be taken away even that 
which he hath." 

And yet Nature, by her very hardness, through forcing 



§ I3«] 



Personal Property. 



11 S 



her children to help themselves and depend for help 
on each other, has evolved from the ineffective merci- 
less savage, the effective sympathetic man ; and through 
him she is indirectly showing to her less favored children 
the mercy that she does not show directly. 

Poverty and disease exist only because Nature (in- 
cluding the man she has evolved) has not yet worked 
entirely beyond them. Nevertheless, great numbers of 
people have vowed not to help in the improvement, but 
to be poor all their lives, because they thought it for 
their own good, and for the good of their fellow men; 
and some of them have even gone so far as to try to 
make themselves sick by fasting and vigils. We can 
hardly assume that there was not any truth whatever 
in their ideas. But good people often do very foolish 
things because they get too enthusiastic over one part 
of the truth. The part here is that poverty and sick- 
ness, being natural, must have some good resulting from 
them, but the good is in overcoming them, not in seek- 
ing them, as the ascetics used to. Some of the noblest 
efforts and wisest discoveries and greatest advances of 
the race have been made in overcoming poverty and 
sickness. In fact, the history of civilization has been 
an overcoming of disadvantages. Most of the intelli- 
gence and morality of mankind have grown up through 
conquering the hard conditions of Nature. All early 
men were savages, man has become civilized only 
through the conquests he has made. Through over- 
coming Nature's difficulties, he has become brave and 
strong; through hard study of her secrets, he has 
become wise; and through helping others who would 
not have needed help if there were no poverty or sick- 
ness, he has become benevolent. 

Poverty and sickness, then, do tend to develop use- 
fulness, tho most modern men prefer to have their 
usefulness arise from different experiences, even at the 
cost of disagreeing with the early saints. 



CHAPTER IX. 



PROPERTY AS CAPITAL. 

The sources of property rights we have so far consid- 
ered, are Land (including, of course, its rent), the wages 
of ordinary Labor, and the profits of Ability. 

That government should protect all those property 
rights — in rent, wages and profits, is a matter-of-course 
too simple to discuss. 

Equally of course, that government 
lufed^ovem-" should protect any one honest dollar of 
nent's protection rent, wages or profits more than any other 
as wages. honest one, would be absurd. If a laborer 

does not use up all his wages, that it should be govern- 
ment's duty to protect his rights in only the portion 
which he uses up, would be an idea twice as absurd as 
the other. And yet many people unconsciously enter- 
tain that idea. Of course if government should protect 
a man's enjoyment of his wages, it should protect his 
enjoyment of his savings. 

If, instead of wasting his surplus wages in expensive 
food or drink, or unnecessarily fine clothes, he sees fit 
to save them and add to the permanent wealth of the 
community in the shape of, say, an addition to his 
house, or to add to the amount of cultivated land by a 
garden, it is plainly government's duty to protect his 
rights in them. To support the contrary would be even 
more ridiculous than to support either of the previous 
suppositions. 

. If then, instead of enjoying his savings himself by, 
say, adding to his house or garden, he sees fit to provide 

116 



§ i35] 



Property as Capital. 



117 



employment for other laborers, say by building a little 
factory and stocking it with tools, to doubt that govern- 
ment should equally protect his rights in that, would be 
the most ridiculous of all. 

Supposing, then, that instead of stopping at saving 
enough to build a little factory, he were in time to save 
enough to build a big one, or even a railroad, it is self- 
evident that government should protect his rights in that 
too. To question it would be. to say that government 
should protect a man while he is being of comparatively 
moderate usefulness, but should desert him as soon as 
he begins to be of great usefulness. 

Now we have just been going over the ground through 
which most rich men have become rich. The men who 
are constantly grumbling that the "poor man stands no 
chance" keep their eyes tight shut to the plain fact that 
the vast majority of rich men started poor, and got rich 
by the ways we have been describing. Not one in ten 
of them inherited his money, and when he did, his 
father generally began poor, and got it in the ways 
described. 

Yet they seldom saved all they made use 
134. A man who of. As soon as a man shows that he has 
can hfreTt? ney the ability to make, save and use a little 
money, other people who have saved are 
glad to lend him more. Money seeks just such invest- 
ments. 

Money thus saved, and employed in the instruments of 
production, is called Capital. 

The usual forms of capital are land — 
consisufn. cap,tal where used for a farm, mine, factory, store, 
railroad, or anything else that produces 
or saves wealth; all tools used in production — includ- 
ing machinery, vehicles and animals; all stocks of goods 
for sale; and all wages and other expenses to keep the 
industry going before the product is sold. 

We first named the essentials of modern industry 
as Labor, Ability and Land. But as we have gone on, 
we have indicated many things besides land — such as 



n8 



TIte Protection of Rights. 



[§i35 



buildings, raw material and machinery, as equally 
essential. Yet altho those things eventually depend on 
the land, it is much handier to group it with them 
under the name of Capital. 

If capital is in land, it gets its returns in Rent. Even 
if a man works his land himself, what he gets more than 
the equivalent of wages, can fairly be called rent. If 
R nt an en ^ er P" ser mres tools, what he pays for 

* en ' them is often called rent. If instead of 
hiring tools or land, he goes to a man whose savings are 
in money, and hires that, in order that he may buy 
land and tools to give workmen employment, the name 
given to what he pays for the use of the money depends 
upon whether he turns over a share of his profits, 
whatever they may be, or pays a fixed price. 

Inte t ^ pays a fixed amount for each dollar 

' n eres and each day's use of it, he pays interest. 
There is no reason why, if a man keeps his savings 
ready to hire to others in the shape of money, he should 
not get paid for the use of them, just as he is paid for 
the use of them if he puts them into land or tools. To 
deny a man's right to interest on his money is as absurd 
as to deny his right to rent for his land, or hire for his 
horse or boat or tools. Yet the world long held the 
opposite opinion. But the world has had to outgrow a 
great many foolish opinions, and will have to outgrow 
a great many more. 

In the good old times when people were 

• $ur y« even more foolish than they are now, all 
interest on money was called usury, and the taking of 
usury was considered wrong, and it sometimes is still. 
But only interest above the legal rate is called usury 
now, and there is not even a legal rate everywhere. 

In some places people can agree on what rate they 
please, but the law generally provides a rate that shall 
apply to a debt in dispute or otherwise delayed, until it 
is settled. Yet in places where the law fixes a rate which 
138 (a) Law* can never ^gally be exceeded, such laws 
against a are not generally observed. They are 

useless. simply ridiculous survivals of the old 



§ i3« b] 



Property as Capital. 



119 



superstitions that prevailed before people knew much 
about money. 

About the end of the nineteenth century, public 
opinion in New York had grown sufficiently enlightened 
for the passage of the following law regarding Interest. 
It leaves many, perhaps most, of the large transactions 
subject to the law of supply and demand, while it con- 
tinues the alleged but illusive paternal policy of pro- 
tecting the man not up to large transactions. 

41 The legal rate is six per cent. A corporation cannot plead 
usury as a defence. The taking or agreeing to take dhy greater 
sum renders the contract or obligation void, except in bottomry 
and respondentia bonds and contracts. For advance of money 
of not less than five thousand dollars, payable on demand: , 
made upon warehouse receipts, bills of lading, certificates of 
stock and of deposits, bills of exchange, bonds, or other nego- 
tiable instruments, pledged as collateral security for such re- 
payment, it shall be lawful to receive or to contract to receive 
and collect, as compensation for making such advances, any 
sum to be agreed upon in writing by the parties to such trans- 
action." 

Tho the legal rate in New York is six per cent., the 
actual rate in Wall Street is generally from two to four 
per cent., but sometimes, for a short pinch, from one 
hundred to two hundred per cent. The law, in New 
York for instance, (except as modified above,) nominally 
punishes taking more than the legal rate, by canceling 
the debt; but practically does not punish at all. The 
most law-abiding citizens do not call upon the law, 
though it would enable them to get rid of their debts: 
for if anybody did, he would not have to pay back the 
money borrowed. But a man's promise to pay is a 
more sacred thing than a worn-out law, and a man who 
acted to the contrary would find it hard to borrow the 
next time he might be in need. 

A large part of the world has already acted more 
freely than New York upon these opinions about the 
mm m^p^^^V of USU1 T ^ws. In England 
ing from eniiqht- there has not been a usury law for over 

ened communities. thirty years> &nd {n Qur mQTe progress i ve 

states, people can contract for any rate they please, 



120 



The Protection of Rights. 



without collateral, tho a legal rate is always provided 
in case money lying in dispute is ultimately recovered. 

The useless and ridiculous law is kept on some of our 
statute-books, however, because the majority of voters 
are too stupid to get trusted with much money, or know 
much about money, and they have an idea that a legal 
rate of interest enables them, if they can borrow at all, 
to borrow lower than they otherwise could. 

The fact is quite the reverse : they gen- 

to%oh?8™ don erallv . have to P a y more than the market 
• rate, in order to compensate the lender for 
the risk of their appealing to the law to release them from 
paying back. The best opinion now is that usury laws 
are a disadvantage to everybody, and to the poor man 
most of all. The poor man nearly always has to pay 
the legal rate, while the rich man may not be paying 
a quarter as much; and when the man in good credit 
can get all he wants at the legal rate or below, it is 
generally impossible for even the deserving poor man 
to get it below the legal rate, and often impossible for him 
to borrow at all. If there were no usury laws, he would 
generally be able to get money at somewhere near the 
market price. 

Yet in backward and ignorant countries, clever 
usurers sometimes despoil the stupid people frightfully. 
Such people might be better off if paternal governments 
would give them usury laws. But a people professing 
(rightly or wrongly) the ability to govern themselves, 
should in consistency profess to be able to make their 
own contracts. 

139 Needs for Now let us take up a new phase of 
associating capital. We have seen (100, 103) that for 
Capital. commun ity to get the benefit of 

"the great industry " through cheapened product, it is 
necessary to do things on a very large scale, and there 
are some things that it is not worth while to do at all 
unless they are done on a very large scale — railroads 
and steamships, for instance. If each man in the civi- 
lized world who is rich enough, were to build a railroad 



§ 140 a] 



Property as Capital. 



121 



or a steamship or a great factory or some other great 
convenience, there are probably not half enough rich 
men to give us all the railroads and steamships and 
similar great enterprises that are needed. Even if 
there were enough rich men, it would not be wise for 
one to put his whole fortune into making one or two 
such things : it is never wise to put all the eggs in one 
basket. In fact, there are some very important enter- 
prises, such as new inventions and mines and explora- 
tions, and other uncertain things, into which it is very 
unwise for anybody to put more than he can afford to 
lose. 

The capital is generally obtained for enterprises too 

large or too uncertain to be undertaken by one man, or 

by a partnership of two or three, by a great number 

, AI of people — sometimes thousands, putting 
140. Incorporations. . , • r , , , j , r 

v their money together, and electing some of 

their number to manage the enterprise. Judge Bald- 
win * says that probably four fifths of the business 
capital and of the industry of the country are now rep- 
resented in such associations. 

But, it may be asked: if a hundred men combine to 
do a business, how would anybody want to trust them, 
when to collect, say, a hundred dollars, he might have 
to sue a hundred men for a dollar apiece? The law 
has met this difficulty by providing that, under proper 
circumstances, a number of persons may be incorporated 
into one fictitious person called a Corporation, and that 
the corporation may be sued, or may sue, or do business 
in almost any way, just as if it were a single person. 
140 (a). As affect- Moreover, if men go into business to- 
ing liability. get her as partners, no matter if each puts 
in only a tenth of what he has, any one of them can 
run the firm into debt so that all might have to pay 
out all that they have, and this while all are attending 
to the business themselves every day. Therefore, if 
an enterprise were proposed to be owned by a thousand 
partners whose interests do not average more than a 

* "Modern Political Problems." ^ 



122 



The Protection of Rights. 



[§ 140 a 



thousand dollars apiece, apparently nobody would be 
foolish enough to take an interest, when any one of 
the thousand partners might run the concern into 
debt so as to use up the whole fortune of any of the 
others. Yet people have often been just that foolish. 
A very conspicuous case is that of the Glasgow Bank 
which failed in the seventies: partners who were not 
interested more than a hundred or two dollars — some 
of them women and old people and children, were de- 
prived of that and of all their other means of support, 
to pay the bank's debts. 

After such experiences, people take the risk of these 
big enterprises only because laws have been made that 
the members of corporations observing certain rules to 
protect the public against bad management, shall not 
be liable for the debts of the corporations beyond the 
amounts they have invested. 

HO (b). Perpetu- In a partnership, if a partner dies, the 
partnership usually comes to an end ; and 
(unless careful arrangements have been made to the 
contrary) the business must be sold, even if it is bought 
in by the other partners and the family of the deceased. 
But if there are a thousand people in a corporation, 
it is not necessary to sell the whole thing out whenever 
any one of them dies. The law provides that corpora- 
tions shall not come to an end when one of the con- 
tributors dies, but that his share shall go on, without 
being entirely separated from the rest, to those who 
inherit from him. 

140 (0). stocks When there are numbers of subscribers, 
and bonds. the shares are kept track of by entering 
all the subscriptions in a book, and issuing for them 
numbered certificates, called shares of stock, generally 
one share for each hundred dollars subscribed. 

Preferred stock is a separate portion of the total 
stock, which shall be entitled to a certain amount of the 
divided profits (dividends) before any are paid on 
the remaining, or "common", stock. Sometimes the 
dividends on preferred stock are "cumulative" — that 
is : before any dividends can be paid on common stock, 



§ 140 c ] 



Property as Capital. 



"3 



payment must be made for any deficiencies of previous 
years below the rate prescribed for the preferred stock. 

When a corporation wishes to borrow for a con- 
siderable time, it generally executes a mortgage (83) 
to some one party, who sells out the claim secured by 
the mortgage, in portions generally varying from fifty 
dollars to one thousand dollars, according to circum- 
stances. These portions are expressed in documents 
under seal (82 d) which are called bonds (8*3 a), and are 
sold to anybody who wants them. Many of ours have 
been bought by Europeans: in other words, the Euro- 
peans have lent us a great deal of money. 

The chief differences between stocks and bonds are: 
(I) a certificate of stock declares that the holder is part 
owner of property, while a bond declares that the holder 
owns a claim against a property, which claim is fixed in 
amount, and must be satisfied before the owners of the 
property can benefit from the property; (II) bonds 
have a steadier value than stocks. A piece of property 
need not pay more than a hundred cents on the dollar 
upon any bonds it may be liable for, and it must pay 
that much if it can, and it generally can: for people are 
not apt to take bonds on a piece of property for more 
than a part of what it is worth. But if it turns out to 
be worth barely the amount of its bonds, the stock- 
holders get nothing. On the other hand, if an enter- 
prise is enormously successful, the bondholders get 
only the amount of their bonds, and the stockholders 
get all the rest. 

Stocks and bonds are both, in effect, claims against 
property, either real or personal, tho the law regards 
both the stocks and bonds themselves as personal prop- 
erty. 

People sell stocks and bonds just as they do any 
other value, and the places where those of the most 
prominent companies are bought and sold are called 
stock-exchanges. 

The prices of stocks at the exchanges become guides 
in settling many civic questions. When business is 
expected to be good, the prices of stocks are high, 



124 



The Protection of Rights. 



[§ 140* 



because the enterprises they represent are expected 
to divide good profits — pay good dividends. Therefore 
when a great question like a political campaign or a 
war is before the people, the prospects of one side or 
the other will affect the price of stoclcs. So when a 
rise in stocks generally attends the good prospects of one 
side, that must be the side which makes for safety of 
property, activity of business, and high wages. 

But by no means all the stocks an& bonds of cor- 
porations are dealt in at the stock-exchanges. Only 
those which the managers of the exchanges think of 
enough importance — probably not one in ten thousand — 
are put on their lists. 

The small corporations are unfavorably affecting the 
craving for land that some philosophers think the wisest 
of all economic desires. Laborers are not trying to own 
their own homes as they used to, but are putting their 
savings more into all sorts of incorporated enterprises. 

To sum up: the principal benefits conferred on the 
community by corporations, are that they make it 
possible to cheapen product by the fullest develop- 
ment of "the great industry ", to carry on enterprises too 
great or too uncertain for private capital, and to secure 
interests in business for the benefit of the owners' heirs. 

Another advantage is that their stocks and bonds 
are often good investments. Yet while many are, 
many more, perhaps, are not. The bonds of the suc- 
cessful ones are very convenient investments for people 
who have a little more money than they want to put 
in a savings-bank, but have not money enough to buy 
a piece of land worth taking care of, or a mortgage 
on one. Those sold on the exchanges are also good in- 
vestments for funds that the owner may want to use 
at short notice, which is a consideration of vastly more 
importance than is generally realized. Sometimes even 
rich men get into trouble because their wealth is in prop- 
erty that cannot readily be sold. 

iai 1 ™ There never was a greater mistake than 

141. Large cor- , 

porations not all the very current one that the bonds and 

owned by the rich. stocks of tfae corporations are all owned 



§143] 



Property as Capital. 



"5 



by rich people. The general course of the money of 
people of moderate means, unless they have it invested 
in their own homes and shops, or building and loan 
associations, is something like this: a great deal of 
it goes directly into the bonds or stocks of corpora- 
tions, and much goes into the savings-banks; the sav- 
ings-banks gather up the little deposits and lend them 
out in large amounts, sometimes on the bonds of cor- 
porations, but generally on mortgages on land; and the 
sums thus borrowed are very largely invested by the 
rich in the corporate enterprises which they organize. 
So the fact is that, at bottom, the corporations are really 
largely * owned by people of very moderate means — 
especially by widows and orphans who cannot go into 
business or manage real estate. 

142 Irres onsl- ®° mucn ^ or the advantages of corpora- 
biilty of corpora- tions; now there are elements of disad- 
t!ons ' vantage. The chief one is that, as the 
liability of shareholders is limited, and as, in the large 
corporations, it is an impossibility for many shareholders 
to keep close oversight, there is great danger of reckless 
and selfish management. This danger also weakens the 
credit of the smaller corporations. 

143 Very small There are too many unimportant little 
corporations undo- corporations, not only because of the 
tirabie. advantages over partnership already ex- 
plained, but also because some time ago people thought it 
made a business look big to call it a company. But that 
has been overdone: the financial irresponsibility of 
the very small corporations generally makes them a 
nuisance; especially as many are started for the ex- 
press purpose of defrauding by the pretentious name of 
a "company", and without personal liability beyond 
the stock owned. The privilege of incorporation 
should not be given below, a considerable amount of 
capital. The evil might be apt to correct itself, 
however, through the growing unwillingness of people 
to trust them, if the gull-crop did not seem inex- 
haustible. 



126 



The Protection of Rights. 



[§ 144 



144. Why Labor Labor generally regards corporations 
hates corporations. w ith extreme disfavor. As corporations 
do not die, and generally consist of so many people 
that they are very unlike a single human being, it 
has become a proverb that "corporations have no 
souls ". Moreover, as corporations run most of the 
very large industries, they are always most prominent 
in the great labor struggles, and therefore many people 
have come to dislike them, and the tendency is to tax 
them unduly. Another reason why they are over- 
taxed is that in order to limit their liability, they have 
to publish some of their accounts, so that people will 
know how far to trust them; and the tax-collectors 
are thus better able, as they are generally disposed, to 
tax them for all they are worth. They cannot do this 
as readily to private concerns that do not have to pub- 
lish their affairs. 

This unfriendly attitude toward corporations, is to 
be deplored when it extends to corporations con- 
ducted fairly: and those large enough to cheapen pro- 
duction through "the great industry" generally are. 
So far as they are unjustly interfered with, their ability 
to cheapen things is impaired. 

145. Danger of There is danger in their being very 
Monopoly. large, because they are apt to become so 
great as to run into monopolies. The word monopoly 
comes from two Greek words meaning "one" and "to 
sell", and it means anything which has only one owner 
to sell. He of course can ask what he pleases, and so 
long as people will buy, his price is not limited at all 
by the cost of production. 

Until Parliament passed the statute against monopo- 
lies in 1624, they had been largely given to royal 
favorites. American courts have always held them 
illegal except for franchises for the public benefit, which 
can fairly be considered to include patents and copy- 
rights, and both of these are specially sanctioned by the 
Constitution of the United States. 



CHAPTER X. 



COMPETITION, MONOPOLY AND INDUSTRIAL AND LABOR 

TRUSTS. 

146 Rights of The ob j ection to a monopoly is that it 
ind'to competl- deprives the public of its rights to Com- 
t,on • petition. 

There are two principal rights regarding competition. 
They might be called the right of Competition, and the 
right to Competition. Each individual has the right of 
competition — the right of competing with other indi- 
viduals; and the community has the right to competi- 
tion — to the reasonable prices and improved qualities 
of goods and service that competition brings. 

The right of individuals to compete, is not a right that 
all are eager to claim. Lazy people do not want to com- 
pete, or rather do not want to have anybody 
tuy ?n a d1tu b p tf id. he compete with them; they hate the very 
name of competition, and want the state 
to try to abolish it, because it forces them to work 
harder; and incapable people hate it because it drives 
them to the wall. Yet if they were wise enough to look 
at the question as consumers, they would see the whole 
active and able world competing to make things better 
and cheaper and more various for them. 

To illustrate the benefits of competition, suppose that, 
in a primitive community, milk is taken around in goat- 
skin bags. If somebody comes along with 
trat'ed^ nefiU ,,,US " a tin can > everybody will get milk from him 
(a), indomettie until the other dealers get tin cans. Then, 

convenience, . - . ° , . . . . ' 

suppose somebody else brings it nicely 
measured in bottles with spring stoppers, instead of 

127 



128 



The Protection of Rights. 



[§ 148 cl 



slopping it into each customer's pitcher amid the dust 
and heat of the street ; pretty soon everybody will take 
from the bottle man until all dealers supply bottles. 
In this way competition will have supplied the com- 
munity with good milk in neat bottles, instead of milk 
apt to sour, from goat -skin bags. But if the early dealer 
had kept a monopoly, the people would still be getting 
it from goat-skins. To carry the illustration a step 
farther: in some parts of the country, the milkman 
sits in his cart and yells or rings a bell, for the customer 
to come out to him; in the other regions, where compe- 
tition is lively, he jumps out himself and carries the 
milk in. 

, + To illustrate competition in means of 

148 (b). h trawl. . , . r , 

travel: there, as in everything else, new 
methods are constantly driving out old. The railway 
competed with the turnpike road ; steam, the cable car, 
the trolley and the automobile are competing with the 
horse; and the bicycle competes with mere walking. 
148 (0). in com- Perhaps the greatest revolution effected 
menial traveling, competition in recent times, is the 
system of commercial traveling. A generation ago 
every considerable dealer outside of the great cities 
had to go to them at least once or twice a year to find 
out what was going on in his line, and to buy a large 
stock of goods ; now nearly everything is brought to him 
by samples. Moreover, as the travelers are constantly 
coming to him, he need not carry nearly as large a stock 
of any particular thing, and can therefore have a 
variety vastly greater and much fresher, and up to the 
latest improvements. Farther: in old times when the 
country merchants went to the cities on their regular 
buying expeditions, they were very apt to get led astray, 
and leave a good deal of money that they brought home 
nothing to show for. Under the new system, if they 
go to the cities as often as they did before, they certainly 
do not stay as long at a time. 

The army of commercial travelers with which com- 
petition has crowded the country, costs a great deal 
more than the old system of dealers going to the cities. 



§148*] Competition, Monopoly, Industrial Trusts. 129 



But it costs not nearly as much in proportion to the 
amount of goods exchanged : the risk of unsalable stock 
is so much lessened, and the chance of getting the best 
and freshest thing for the money is so much increased. 
And all this has made it possible to supply more things 
and newer kinds of things for the same money. That 
has made new manufacturing industries possible, and 
increased the demand for labor, and the supply of con- 
veniences, in very many ways. 

In addition to the more direct benefits of this system 
of competition, commercial travelers have improved 
traveling facilities in general. They enable the rail- 
roads to give better and wider service than they other- 
wise could, and they have also led to a great improve- 
ment in the country hotels. After the stage-coaches 
went out, and before the commercial travelers came in, 
the country hotels got into a very bad way. 

Competition greatly promotes the steadi- 
tfonif pric*! u,a ~ ness of business. It regulates prices, and 
t Md U iuppf^! and ma kes their rise and fall so gradual that 
people can make some preparation for 
either : when goods begin to be abundant, sellers 
begin to compete by lowering prices; and when goods 
are becoming scarce, buyers begin to compete by 
offering higher prices. To put it in more scientific 
terms: prices are regulated by demand and supply. 
Prices are steady when the demand for goods or labor 
is just equal to keeping them in use at the prices asked. 
That equality is technically called the Equation of 
Demand and Supply. When the equation is disturbed 
by increase of supply, competition in lowering prices 
increases demand until demand and supply are again 
equal. When the equation is disturbed by increased 
demand, competition bids up prices and chokes off 
demand until demand and supply are equal. 
148 Minor That "Competition is the life of trade", 
exceptions. j s an p r0 verb : it is of great benefit in 
keeping business active, and men at work. 

Yet it may not be quite fair to say that rise in prices 
is always started by the demand of competing buyers. 



The Protection of Rights. 



[§ 148* 



It always is in the great auction exchanges for stocks, 
produce and real estate, where probably most of the 
world's business is done. Tho of course private dealers 
do not merely mark up prices of staples to follow the 
great exchanges, but mark them up also on other 
articles when they find their stocks running short. 

149. Evils In Every good thing can be carried to an 

competition. extreme, or used in a harmful way — in 
fact, some people think that all evil tendencies are 
merely good ones misused: accordingly, competition 
is sometimes harmful. It is often called harmful in 
driving out of business men who lack ability. But that 
is not harmful, even to the man himself: if an unable 

149 (a), suponsa- man tr * es to con duct business, he is 
ing incapacity not always keeping his customers waiting, 
among them. making mistakes, unable to furnish good 
goods, or any goods at moderate prices (except as his 
bankrupt stock ultimately gets into the bargain-stores) ; 
and he is under constant temptation to cover up his 
incapacity by dishonesty. His custom goes, of course, 
to more able men. Yet there ought to be a place in 
the world for a man whom Nature has not blessed with 
business ability: some of the best of men have lacked 
it. And there is a place for him under the guidance 
of the man who has ability; and the man without it 
is much better off there, than in stumbling along by 
himself, if he only has the sense to know it; and the 
community is vastly better off for his being there. 
149 (b). Nor fa The notion has arisen that competition 
poverty. { s a ca use of poverty, because every man 

who is not conducting business himself, and sees rich 
men conducting it, thinks that if he were conduct- 
ing business, he would be rich too. Every mechanic in 
the shop blames competition for preventing his being 
boss; whereas if he were, in the vast majority of cases, 
he would soon be bankrupt and poorer than he is, and 
the rest of the men thrown out of employment. The 
minority who are really able enough to be bosses, are 
not many of them prevented by competition from 



§151] Competition, Monopoly, Industrial Trusts. 131 



becoming bosses. They generally do it in good time. 
149 <c). But waste- Yet competition is very often wasteful, 
fulness is. an( | as j on g as there are foolish men, it 
very often will be. But as to its driving a man out of 
business, that is not usually because of waste (unless 
it is his own waste), but because another man can make 
a profit by supplying the community at rates lower than 
the first man is able enough to. But nevertheless, there 
are plenty of instances of competition being carried to 
the point of waste on both sides — for instance, where 
advertising or drumming (both excellent things within 
limits) is carried to excess, or when a man has or thinks, 
he has more money than his competitor, and does 
business at a loss so as to get the other's customers 
away, expecting to make up his losses after his com- 
petitor is driven out of business. In this way, before 
people learned better, the steamboats in the West and 
Southwest sometimes carried passengers for nothing, 
and even threw in their meals. True, the public got the 

150. Public seldom benefit of the competition, but only for 
gainer by wasteful a time. After one party was driven out, 
competition. &nd the monopoly held by the other> the 

monopolist could put prices where he pleased. Such 
business is not really competition, but an effort to kill 
off competition. Legitimate competition is really 
economical. 

But leaving out of consideration persons who are 
ruined by wasteful competition, if the public has been 
accommodated at extra-low prices, they might be no 
worse off if for a time they have to pay extra-high ones, 
were it not that they must pay them long enough to 
make up for the waste, and pay a profit on it. More- 
over, unsteady prices unsettle business: nobody knows 
what to count on; and prices lower than they ought 
to be, get people into wasteful ways that do not stop 
when prices get normal again. 

151. Cooperation One is tempted to believe that the whole 
and competition, community would be vastly better off 
in wealth and peacefulness if competition could be re- 
placed by cooperation — if instead of all struggling 



132 The Protection of Rights. [§ 151 

against each other, we were all helping each other. But 
on considering how it is to come about, one is, as usual 
when venturing very far beyond experience, mired in a 
tangle of paradoxes. Competition consists largely in 
the lowering of prices. This, instead of proving com- 
petition a bane, shows it to be for the benefit of the 
public. But on the other hand, we have seen that as 
regards the competitors, competition is often attended 
with great waste in drumming, advertising and ruinously 
low prices. Suppose then that the men in a particular 
trade get together and agree that they could make more 
by helping each other than by fighting each other; and 
so make elaborate agreements to regulate prices and 
limit advertising and drumming, or combine all their 
businesses under the regulation of a few of the principals. 

This has been done in the trusts. But 
152. Capital trusts, while, under them, the members of the 

trade get the benefit of cooperation, the 
public loses the benefit of competition. Here is our 
paradox: apparently we could benefit by helping 
each other, but as soon as we try it in the business 
world, somebody gets hurt. Yet it is true that with 
less " human nature", the trusts could both lower 
prices and increase profits. Even as matters are, 
it is by no means certain that they do not.- It is very 
certain that during the phenomenal advance of prices in 
America in the first half-dozen years of the twentieth 
century, oil, the most trust-guarded of all commodities, 
advanced among the least. But advances, whatever 
they may be, do not negative the fact that with less 
"human nature", trust-economized goods would be 
the cheapest, and would prove cooperation better than 
competition. So we can keep on hoping for a co- 
operative world, but it is destruction to try to realize 
it any faster than human nature makes the realization 
practicable. 

Mr. Bellamy expounded the notion of the benign 
trust in one commodity, into a benign trust in all, its 
functions to be conducted by the state. The benefits 
that he imagined from such a system were so great 



§152 a] Competition, Monopoly, Industrial Trusts. 133 

that he pictured the average family as living, instead 
of at the present average of six or seven hundred dol- 
lars a year, at an average of some thirty thousand. The 
benign trust alone is probably far beyond the range of 
human vision; farther still is the degree of political 
capacity essential to the public administration of one; 
farther still, the political capacity to administer all; 
and when, if ever, these remote ideals have been realized, 
they wi}l need to be reinforced by human control of 
natural forces, to a degree that still farther staggers 
imagination, before the good things of this life can be 
multiplied the fifty-fold that many dreamers fancy 
would result from an even distribution of the present 
product. 

But to come back to the world we know. A trust, if 
properly conducted, not only does away with wasteful 
competition, but it has more of the advantages of "the 
great industry " than smaller individual businesses could 
have: it is getting to be an old story that the large 
production is the cheap production. 
152 (a). Their Moreover, the trusts save expenses by 

economy. using fewer managers, clerks and buildings, 

as well as by diminishing traveling and advertising. 
Where the businesses to be united in the trust are con- 
ducted separately, many of these items are unnecessarily 
duplicated The trusts are said to have dispensed with 
150,000 commercial travelers from '97 to '99, leaving 
these men to go into industries supplying new comforts 
and luxuries, or old ones cheaper. 

But that economy is effected by driving people out 
of work. That certainly is a benefit to the consumer, 
if the trust gives him part of the saving, tho it is not 
at the moment a benefit to the people driven out of 
work. But new demands for labor are created by the 
money saved through cheapened production : therefore 
people thrown out of work to save that money, will 
soon be at work again (331), and also benefiting, as 
consumers, by the cheapened production; and the 
drummers will soon be drumming again for new bene- 



134 



The Protection of Rights. 



[§ iS 2a 



fits to the community,* or conferring them in other 
ways. 

If trusts do away with wasteful competition by crush- 
ing out establishments that do not join them, there are 
two sides to the question. Of course having so much 
capital, and being able to produce so low under the 
great industry, if it is their interest to keep prices 
low enough, the trusts can run destructive opposition 
to individuals: but on the other hand, after they have 
driven off competition, they may get prices so high 
as to encourage individual concerns to enter the busi- 
ness. 

As a matter of fact, these considerations have often 
kept the profits of monopolies within bounds. The 
weight of intelligent opinion is that but a small relative 
proportion of the great fortunes has been made in 
monopolized industries, but that most have been made 
in industries open to anybody with the ability to con- 
duct them. 

The Census returns for 1900 declare that 
^fyprofitabfe. ner " °f various ' 1 trusts ' ' or similar combinations, 
one-third paid no dividends, and another 
third paid dividends only on their preferred stock (140 c). 
Notwithstanding the advantages hoped for by combina- 
tion, the stocks of most trusts are, thus far, held in very 
low esteem. This is largely because enormous amounts of 
them were issued in excess of the actual values of the 
properties combined in the trusts: in the whiskey trust, 
for instance, about sevenfold. A very large share of 
these excessive issues of stock often went to bankers, 
lawyers, and other promoters, for their services in 
effecting combinations. The great business depression 
of 1903-4 was largely due to people who supposed 
themselves rich in these stocks, having spent more 
money than the stocks turned out to be worth. 

On the other hand, some of the trusts, especially the 

* The landlord of a favorite drummers' hotel told the author 
late in 1900 that he had not noticed any difference in the aggre- 
gate amount of commercial travel, despite the 150.000 men said 
to have been thrown out by the formation of the trusts. 



§ 152 d] Competition, Monopoly, Industrial Trusts. 135 



older ones whose stock was not so much watered, have 
been enormously profitable. 

The portion of the total output of their respective 
industries which has been controlled by the trusts, 
has varied between sixty and ninety per cent. The 
control of even sixty per cent, enables a combination 
to regulate prices pretty effectually. 

Probably the best brief summary of this important 
topic is contained in Professor Seager's 44 Economics." 
\52(e). Their mon- Inordinate prices in a trust are short- 
SS2m//S1^ m sighted for two reasons : first , the most prof- 
itable business must generally be done 
at prices low enough to enlarge custom; and second, 
the only policy that justifies the existence of a trust, 
is the use of its great facilities to serve the public at 
prices that defy competition from smaller concerns. If 
that is hard on smaller concerns, they can join the 
trust, or go into some business to supply new con- 
veniences or cheapen old ones. Where it is a question 
of the public being served well and cheaply, it will 
not do to be tender about the interests of an individual. 

It is not meant from all this to intimate that, in 
virtue of preventing wasteful competition between their 
members, and producing by cheap processes, the trusts 
are an unmixed good. As already said, they are in 
danger of becoming monopolies, just as 
vliid^not!" 6 ' is an individual competitor choking off 
another : and moreover, if there is no com- 
petitor to force the trusts to keep low prices, they are 
sometimes unwise enough to keep all the economies of 
"the great industry" for their own benefit until they 
find that course suicidal. 

But, it may be asked, has not a man a right to set 
his own price on his own property? If not, what 
becomes of property rights? If one man or one cor- 
poration or one trust has wealth enough to drive out 
weak competitors and get hold of the entire supply 
of any commodity or facility, is it not fair that people 
who want it should pay the holder's price? Perhaps 



The Protection of Rights. 



they should if they let a monopoly get the control, 
but that is just what they should not do. 

Moreover, a man has not always a right to set his 
own price on his own property : a man having a monopoly 

of plenty of food has no right to demand 
rfgtiti i do P not y aiways a starving man's fortune for enough food 
rights! monopoly to save k* m * There is a limit, then, to 

property rights. As we have already 
agreed more than once, there is a limit to all rights — 
there is to everything we can conceive of, for that 
matter: the state has a right, whenever the greatest 
good of the greatest number requires it, to take a 
man's property or labor at a fair price, or even his 
life at no price at all, tho it usually pensions a de- 
pendent survivor. The state, then, might properly 
take an unjust monopoly's goods by eminent domain, 
and sell them to the people at reasonable prices. But 

<ti . A „ x , while the principle is right, the way around 
154. State Control. . « f , 1 j i_ • \ r I-l j_ ^ 
is long. It would be simpler for the state 

to compel the monopoly to sell at reasonable prices, or 
better still, wherever the state can, to encourage compe- 
tition. Laws have been enacted regulating prices of 
such monopolies as railroads, water companies, etc., and 
there are also two classes of what are generally called 
anti-trust laws — one class providing that persons con- 
spiring to unduly raise the price of goods, shall be liable 
to the same penalties as persons conspiring to defraud; 
the other, that corporations so acting shall lose their 
charters, and trusts so acting shall be dissolved. Per- 
haps these laws are yet too new to show whether there 
is much good in them. So far, they have been found 
very hard to enforce: partly because it is very hard 
to get evidence that will fasten the guilt where it 
belongs. 

154 (ai By ami- Monopolies are against the common law, 
Trust Laws. an d [ n ^ t h e United States Congress (as 
many state legislatures have done before and since) 
reinforced the common law by a statute. The following 
remarks on it in the Times of April 13, 1903, throw 
much light on the subject — not the least, on the diffi- 



§ 1 54° J Competition, Monopoly, Industrial. Trusts. 137 



culty of getting advantages out of such laws. The 
statute declared 

"contracts and combinations in restraint of trade or com- 
merce among the states to be unlawful. . . . Nobody had 
any idea, not even its framers, that it would be used against 
the railroads. . . . Up to the end of the year 1901 there had 
been twenty-three suits brought by the government under 
that Act. Only four of these actions attracted general public 
attention. The Knight case against the Sugar Trust resulted 
in 'the defeat of the government, the Supreme Court holding 
that production was not commerce. The Trans-Missouri 
Freight Association and the Joint Traffic Association were 
actual combinations to fix rates, and the Supreme Court declared 
them unlawful. In the Addyston Pipe and Steel Company 
case, a particularly vicious conspiracy in restraint of trade 
was broken up by the judgment and decree of the court. Taking 
the twenty-tnree government suits together, the government 
has lost eleven outright, has accomplished nothing in two, and 
has won ten. Of the ten, four are against labor unions and 
strikers. Of the remaining six, four are the suits above men- 
tioned. Three other suits, that against the Northern Securities 
just decided, the suit against the Beef Trust, and the suit 
against the Federal Salt Company, have been brought since 
the beginning of the year 1902. This makes twenty-six suits 
in thirteen years — two a year. No wonder the agitators pro- 
claimed that the law was a dead letter . . . the anti-trust 
law has been fished up from its condition of nocuous or innocu- 
ous desuetude, under which actions were brought at the rate 
of two a year, to be made to-day the most conspicuous statute 
in the land. . . . It is to be added, however — and the considera- 
tion is an important one — that President Roosevelt's provo- 
cations have far exceeded those to which his predecessors were 
subjected. The Northern Securities combination was quite 
the most flagrant, bold and undisguised defiance of the law 
of 1890 which the country has witnessed. The Beef Trust 
combination was also one peculiarly offensive to the popular 
sense of right, a sense somewhat sharpened, no doubt, by the 
high prices of beef which prevailed a year ago. 

"The brilliant success of the proceedings against the Northern 
Securities Company [a corporation formed to hold the stock 
of several railroad companies, and so do away with competi- 
tion between them. The government dissolved the corporation. 
It is not proved, however, that the result cannot be accom- 
plished in other ways], it is hoped in some quarters and feared 
in others, will inspire the Administration to an enthusiastic 
pursuit of other offending corporations. There are plenty of 
them. Not only the coal-carrying roads, but corporations like 
the New Haven Road, with its control of the Sound steamboat 
lines; the Pennsylvania Railroad, which in one way or another 



I3« 



The Protection of Rights. 



[§i54 <* 



controls the Reading, the New Jersey Central, and the Balti- 
more and Ohio; the Lake Shore, which controls the "Nickel 
Plate", and dozens of other railroad systems, small and great, 
lie open to the assault of the Attorney-General under the ex- 
ceedingly broad principles of the Northern Securities decision. 
There is no occasion to prove that they do restrain trade or 
fix unreasonable rates. The court says that is not the question; 
and the Supreme Court itself has ruled that the possession of 
the power to do the unlawful acts is all that it is necessary to 
prove." 

The law has been invoked several times since the 
quoted editorial was written, especially regarding ice 
trusts, meat trusts, and railroad rebates, with the 
punishment of some offenders, and probably the dis- 
couragement of some abuses into which, without the 
law, the trusts both of capital and labor would have 
ventured. All newspaper readers know the details: so 
it is hardly worth while to state them here. More- 
over, Congress has passed the Railroad Rate Bill, whose 
efficacy is yet to be tested, and the Meat Inspection Bill. 
154 (b) capita/ While in a case that has come under 
Trusts and Labor my knowledge, a number of manufacturers 
ru8t8 ' of exceptional standing were advised by 

their counsel not to agree on rates and prices, for 
fear they would be haled into court for violating the 
anti-trust law, the Sherman Interstate Act, and the 
Donnelly Act, the members of the trades-unions all 
over the country are agreeing to keep up prices, with- 
out anybody paying any attention to the illegality 
of it; and all this despite the laboring man's standard 
claim that he, of all men, is the constant victim of 
injustice! 

So far as monopolies are controlled, as they nearly all 
are, by corporations, the state has a right to regulate 
them, because the corporations are made by the state. 
When the state confers on a corporation the privileges of 
limited liability, the right to sue and be sued as a unit, 
and the right of continuous association of property in- 
terests in spite of the death of a member, the state has a 
right, of course, to name the conditions on which it 
confers the benefits — the duties which must attach to 



§154*] Competition, Monopoly, Industrial Trusts. 139 



the rights — and prominent among these conditions, of 
course, are defences against misuse of monopoly privi- 
leges. 

\S\(e). By fixing Probably the most frequent instance of 
prices. the state thus making wise conditions, is 

the regulation of railroad rates — street-car fares in 
cities, mileage rates on steam roads, and freight rates 
between points where there are not competing roads. 
It might be wiser to force the roads to keep their prices 
down, by setting a limit to the profits they shall divide : 
for an arbitrary price might be less than they could 
continue business at. But a danger in limiting profits, 
is that the roads would prefer to earn them by a small 
and easy business at high prices, rather than a larger and 
more difficult business at low prices; whereas, if they are 
permitted to make all they can, they may often widen 
business by rates even lower than those which would 
give them the profit arbitrarily fixed for them. A 
road might make as much money by running a few 
trains at a dollar a head, as by running more at seventy- 
five cents, and prefer the smaller trouble and wear of 
the few trains at a dollar. Yet it might make a great 
deal more money by running still more trains at fifty 
cents, but be restrained because not permitted to earn 
more than it could at a dollar. 

154 Byemi- One of the best instances of wise state 
nent domain. interference with monopoly abuses, by 
direct exercise of eminent domain, is at Niagara Falls. 
The neighborhood used to be one of the plague-spots of 
the earth — covered with unsightly and ill-arranged 
structures, and infested by extortionate hackmen and 
cheating fakirs of all sorts. The state took the land 
by eminent domain, made a beautiful park of it, and 
has everything well managed at reasonable prices. 
154 (e> Danger of sucn state interferences may become 

government tyrannical and foolish. Corrupt politi- 
tyranny. cians may interfere to extort blackmail, 

and at best the state cannot know all sorts of business, 
and should be very slow to interfere with, or itself 
conduct, any. 



140 The Protection of Rights. [§ 1 55 

155 Effect of eat ^ e e ^ ect °* & reat corporations and 
aggregations of M trusts on legislation is much discussed. 
Xff °" Legl$ " They can afford to bribe more than smaller 
on ' private concerns could, and get all sorts of 

"protective" laws to shut off foreign competition, so 
that they can impose upon the public the highest rates 
the public will pay; and they can often make most 
money by selling to a few at high prices, and forcing the 
many to go without. The Sugar Trust is generally 
believed to have bought three senators of the United 
States in the Fifty-second Congress, and prevented 
the passage of a reformed tariff bill which that Congress 
was specially elected to pass. Tho that Congress did 
pass a reformed tariff bill, it was a very lame and 
doubtful one, largely owing to the obstruction of the 
suspected senators. The reform did not reach the 
sugar. 

156. Socialism as It has been urged that we could get rid 
a remedy f the corruption if the state itself ran 

all the industries — that we could get rid of all the trusts 
by making the state itself a trust that should include 
them all, as proposed by Mr. Bellamy; and one argument 
is that then there would be no one interested to buy 
votes. But examined, this is simply a claim that it 
would be better if the politicians were running the 
industries themselves: so they could vote to favor 
their pets without being bought — so that instead of 
having the corruption funds of the corporations and 
trusts ladled out to them as now, they would hold the 
ladle themselves. Tho nominally the politicians would 
be working the industries for the state, and not for 
themselves, we have seen enough of the way they are 
apt to "work for the state and not for themselves". 
Moreover, business will be managed much better if 
the manager is working for his own benefit, and ac- 
cording to his own ideas, than if he is working for the 
state, and according to its own ideas — even if there 
were any way of keeping the state's ideas fixed. But, 
it is urged, the manager of a corporation or a trust 



§iS7] Competition, Monopoly, Industrial Trusts. 141 



is not generally working for himself; yet he generally 
owns a large share, while if his concern belonged to the 
government, he would not own a millionth part. 
157. The only Tha only effective policy, then, against 

real remedies. the corruption of legislatures by monopo- 
lies, seems to be to do our best to see that only incor- 
ruptible men are elected to office, to perfect our laws, 
and to educate people so that there will be more 
chance of the corporations and trusts being managed 
by men who will develop the good side for the benefit 
of the community as well as of themselves. The state 
must continue to make corporations and permit trusts 
in some form, while at the same time it must make laws 
to protect people from them; and it must do this for 
the same reasons that it encourages the rearing of 
citizens, when it has to make laws to protect itself 
against bad ones — corporations and trusts have their 
good sides just as people have. 

Probably the competition in drumming and advertising 
has done as much as anything else to lead, to the forma- 
tion of the trusts. The success of "publicity" in some 
businesses peculiarly responsive to it, has recently led to 
a wasteful mania for it, and extravagant efforts of dealers 
to outdo each other in it, even regarding things, like 
books, of inevitably limited demand, and touching which 
people make up their own minds, more or less under 
expert advice. Regarding this waste and some others, 
Professor Cooley indicates a remedial influence outside 
of the trusts. He says * that competition grows with 
capital and industrial freedom, and that it declines as 
intelligence and morality on the part of the buyer grow. 
These conditions of growth are plain, on a little reflec- 
tion, but the reasons for decline may justify a little 
explanation. When a man knows good from bad, 
and follows the good when he sees it, he will be apt 
to make up his own mind, and it is therefore a com- 
parative waste to send a drummer or a tempting adver- 

* In his remarkable pamphlet on Competition, published by 
the American Economic Association. 



142 The Protection of Rights. [§ 157 

tisement after him. Moreover, and doubly important, 
if he is an honest man in a position of trust, like that 
of a commissioner of public works or education, he 
is not going to choose subordinates or material on ac- 
count of anybody's "pull". 

Another hopeful influence that seems likely to promote 
the advantages and suppress the disadvantages of com- 
petition in the future, is the growing recognition of 
broad self-interest and of civic responsibility. Already 
there is here and there a man at the head of a great 
combination who, like Pullman or Wanamaker, amid 
all the errors of the struggle, shows some realization 
that the best profit lies in serving the public well and 
cheaply, and has some sense of duty to his fellow 
men. 

157 Anittu*- Probably there is justification — double 
tration. justification as it recalls the bright exam- 

ple of a good man, for a more specific illustration that 
success is not dependent on the kind of competition 
that excludes human sympathy. I have the best 
occasion to know that some forty years ago, a man 
very young in the publishing business had occasion 
to call, on some purely commercial matter, on the 
late Mr. Charles Scribner, the founder of the great 
house, to whom the young man was barely known by 
name. As the visitor was about leaving, Mr. Scribner 
said: "When I see a young man beginning business, 
it makes me recall my perplexities when I began. 
It would have been everything to me if I could have 
taken them to some more experienced man. I should 
be very glad if you care to bring yours freely to me." 
There has never been any indication that the great 
business founded in that spirit is any the worse for 
it, while the kind suggestion could have brought 
nothing but good to the " competing" (?) business. 
Certainly if that spirit actuated all the members of 
each trade, the world would be a great deal happier — 
and richer: the money — or let us say the force, of 
which money is only the index — now wasted in com- 



§ I S7 a ] Competition, Monopoly, Industrial Trusts. 143 

petition, would be saved for making new things or 
cheapening old ones. But how to bring about that 
ideal state of affairs? Well, the persons most imme- 
diately at hand to begin, are, patient reader, you and I. 
Of course, in courtesy, I yield you the precedence. 



CHAPTER XL 



RIGHTS IN NATURAL MONOPOLIES. 

158. Some things There is a class of monopolies which must 
are Inevitably in their very nature remain monopolies, 
monopolies. {n gpite of aU we can dQ 

A street railroad usually remains a monopoly because 
not more than one can ordinarily be laid in a street. It 
is generally the same with a city's water-supply and 
gas-supply, and even its sewerage, connections with 
which are actually sold in some places. Perhaps, too, 
it would not be straining language to say that in some 
industries, the first factory built is a natural monopoly, 
because while there may be demand enough to support 
that one, even at a very great profit, there may not be 
demand enough to justify building another. 

And such city works and factories are not the only 
things which are naturally monopolies. Nearly all roads, 
bridges and ferries are, and so are natural objects which 
cannot be duplicated — such as extraordinary mines and 
springs, and picturesque works of Nature like Niagara 
and the Yellowstone. 

158 (a). But the Some people even go so far as to think 
earth not one of that there is a natural monopoly a great 
them ' deal bigger than all the things we have 

named put together — namely, the entire land of the 
earth. But it is impossible to see why. Any one piece 
of land is a monopoly: but so is any one piece of pork, 
and the land in any single locality may be "cornered", 
as pork or lumber or wool or anything else may; but 
land generally, cannot be a monopoly, so long as no one 

144 



§i6oJ 



Rights in Natural Monopolies. 



145 



party owns all of it, and people are competing with each 
other in selling it, any more than anything else that is 
generally dealt in can be a monopoly. Yet there are 
thousands of people, and some of them very good people, 
who actually think that all the inequalities in the lot 
of man arise from land being a monopoly, and that the 
inequalities would be removed if people paid rent to 
the state instead of to landlords (66). 

159 Why Railroads to retum to things which are natural 

are apt to be mon- monopolies: between two places there can 
opoiies. k e several railroads, why then is one apt 

to be a monopoly ? Because the first one laid out is apt 
to be on the best route, and there is seldom any other 
route good enough to compete with it. Another 
prominent reason is that the travel may be enough to 
pay enormous profits on one road, without being enough 
to justify building another. 

159 (a). Why they ^ railroad cannot be built without gov- 
need government ernment authority, because in the country, 
authorization q£ course nobody can take land for a road 
without government authority (78), while in a city 
it would not do to have anybody who felt like it, 
take possession of a street for a railroad. Some streets 
would soon be so full of tracks as to be destroyed for 
other purposes, and few streets would be left free from 
them. Moreover, as the right to build a railroad is 

valuable, the city ought to be paid for it 
] paVforlt d8hOUtdh y those who occupy the streets for the 

purpose. The right is really a lease of 
the streets, and generally a salable one. 
159 (eh 80 with The rights to supply light, water, etc., 
other facilities. anc j t Q CO ntrol most other such things, are 
in the nature of monopolies, and of course rights to use 
the streets for such purposes are virtually leases too. 

The rights to control these natural monopolies are 
called Franchises. 

While the community can sell franchises 
A^erlca°belng gen- to corporations or individuals, in Europe 
b^tfce g o?ltidans. t ^ ie community generally either uses the 

franchises itself, or leases then? at great 



146 



The Protection of Rights. 



[§160 



advantage; but in America, until very lately, it has 
generally let the politicians and their friends make up 
private corporations and settle down on the franchises 
without any return whatever to the community. 
This has been permitted because people are generally 
too lazy, or too engrossed in their own affairs, or too 
stupid, to take care of their public rights — because, in 
short, they lack political ability — which of course in- 
cludes political virtue, just as (despite a few conspicuous 
exceptions to the contrary) business ability includes 
business virtue. If the people had enough political 
virtue or ability to take care of their own interests, 
they could manage their franchises through their own 
officers. Yet it might be just as wise under any circum- 
stances to sell rights to do part of the work, as it is 
for other corporations to do the same; for instance, the 
railroads often sell rights to run palace- and dining-cars, 
and to supply reading-matter on trains. 

As a rule, when a community wishes to get a profit from 
its franchises, it is best not to sell them outright once 
for all, but to lease them, and only for terms of years: 
because, as the city grows, the franchises 
loid outright" * be become more fruitful. As an instance of 
the value of such rights, the city of Balti- 
more has unusually good parks , and unusually many of 
them, which are paid for and kept up by a portion of 
the receipts of the street railroads. Some other Ameri- 
can cities are beginning to get revenues from their street 
railways and most European cities which do not run 
their own, derive large revenues from the companies 
which lease the franchises. 

162. How natural ^ OW * et US ^ 00 ^ back °f this little dis- 
Mononoiies become cussion of natural monopolies, to see how 
Personal Property. {ar we haye been j ustified in treating rights 

in natural monopolies as rights of property. So far we 
have been principally concerned in relation to property 
rights, with their creation by the development of natural 
resources through manufactures and transportation, 
and with the determination of what shares of the result 
should go to the Laborer, the Capitalist and the Enter- 



§ 162] Rights in Natural Monopolies. 147 



priser. The landlord is of course one of the capitalists. 
We came to treat monopolies and trusts in these con- 
nections, because they are aggregations of capital. It 
is more than a mere metaphor to regard even natural 
monopolies in the same way. Railroads, city water- 
supplies, etc., are plainly aggregations of capital, but 
each of them is both an artificial and a natural monopoly ; 
a mine is perhaps more distinctly a natural one. And 
yet as soon as any one of these natural monopolies, or 
even a natural curiosity or beauty attracting admission- 
fees, begins to pay income, it becomes capital, and 
therefore its shares become personal property. 

We will consider these matters more at length when 
we come to Government's Promotion of Convenience. 
Now let us go on to the Law of Personal Property. 



CHAPTER XII. 1 



THE LAW OF RIGHTS IN PERSONAL PROPERTY. 



We saw (82) that the ownership of personal property 
is generally transferred by mere delivery. It is seldom 
registered, like that of land, because in most cases the 

perishable and transferable nature of 
{Swn D Uw e o7per b - e " personal property would make registry 
tSat of Land rty and mere ty a nuisance; but its ownership is 

sometimes registered when it passes out 
of the owner's possession. For instance, if goods are 

163 (a). Personal P ut * n a P u *°^ c warehouse or given to an 
property seldom express or freight company, or money is 
registered. j e £ t Qn deposit, j^e article is entered in 
a book, and a receipt of some kind is generally given. 
163 (b). important Bonds are often registered in the owner's 
kinds passed by name at the office of the company issuing 
en orsement. them, and stocks always are, tho upon 
being issued, they may be endorsed in blank, and pass 
through many hands before being registered again. 

"Endorsed" means literally 44 on-backed and usu- 
ally refers to writing one's name on the back of a paper 
entitling the writer to some sort of personal property. 
Endorsing is generally in token that the writer parts 
with the right to the value stated on the face of the 
paper, in favor of whoever may thereafter hold the 
paper, or of some person named in the endorsement. 

If the endorsement is in favor of a particular person 
named, the latter can pass the value on, by himself 
writing a second endorsement. The principal kinds 
of papers entitling somebody to receive value, of which 

148 



§ 163 c] The Law of Rights in Personal Property. 149 



the value is passed on through endorsement, are bank 
checks, promissory notes, stocks, bonds and warehouse 
receipts for many kinds of merchandise. 

As a rule, if an endorser has prompt legal notice that 
the signer of the paper fails to make it good, he is 
responsible that any later holder shall receive what is 
called for on the face of the paper, but not in the case 
of stocks and bonds. On them, an endorsement is 
merely an authorization to the company to register the 
certificate in a new name. 

When an endorser becomes responsible, it is on the 
theory that he has received an equivalent from the later 
holder, and therefore is responsible to him for the value 
for which that equivalent was given; the same theory 
follows each transfer of the document. But in fact, an 
endorser does not always receive an equivalent, unless 
friendship or favor is to be so considered : for men often 
endorse checks and promissory notes, and make them- 
selves responsible for their payment, to enable their 
makers to use them where their credit would not other- 
wise enable them to. 

With three exceptions (87), one has a 
wl^Lwhlwer right to take one's property wherever one 

wll!i'bSfon^ m9 sees ft he can do so witnout violence: 
otherwise the rule is about the same as 
in real estate. 

If a robber has put property in another person's 
house, the owner must not break in or fight his way to it. 
Rather than have the peace disturbed, the law prefers 
that he should stand still and risk the robber's carrying 
the property to a place of concealment, on the chances 
of preventing that in some other way. If somebody 
goes into the owner's house for it, and has it and refuses 
to give it up at the owner's demand, it is then the duty 
of any citizen satisfied that he has stolen it, to arrest 
him, as it is to arrest anybody he finds committing 
a crime. 

If the robber resists, any citizen arresting is armed 
with the authority of the law, and can use any force 
necessary. True, the citizen could not use any force 



The Protection of Rights. 



[§163* 



necessary to drive a man off from his land (81 6), but 
his being there was not a crime. The citizen has the 
duty and the power to arrest only in cases of crime — 
such as murder, arson, burglary or theft. 

The exceptions already alluded to, where a person 
cannot peaceably take his own property wherever he 
sees it, are, in a sense, not exceptions, but rather 
instances (the only ones) where a thing 
l*Vomeki"di?a h n' p may peacefully cease to be one's property 
nU?ect ith0Ut without one's receiving a satisfactory 
equivalent, or at least (as in the case of 
taxes or eminent domain) one declared satisfactory 
by the law. These exceptional instances are money 
and 14 negotiable paper" — bank checks, promissory 
notes and bills of exchange. If theft or accident puts 
one of them in wrong hands, and they transfer it for 
"good value to a holder innocent of any wrong or knowl- 
edge of wrong regarding it, the innocent holder can 
recover its value from all parties who would be liable 
if it had to come to him regularly. Of course this is 
hard on honest makers and endorsers of such paper, 
who Iosq it, or from whom it is stolen, but it would be 
harder on the community if all business had to wait 
for the history of every piece of commercial paper to 
be investigated, as it has to wait for real-estate titles 
to be investigated. As a matter of fact, the easy 
transfer of rights in commercial paper is seldom hard 
on anybody: for the result of the law is that people 
take such good care of their paper that it is seldom 
lost or stolen. 

While personal property can be loaned or hired out 
in an infinite number of ways, ownership of it is not 
considered as enduring enough to be popularly called 
an "estate", as in land; yet there can be a life estate 
in some kinds of personal property, perhaps in any 
kind, notably in libraries and works of art. 

Like land, however, it can be mortgaged. 
mori e gag C ed n i^thout Such a mortgage is called a chattel mort- 
g7ge9'apUaH8°<n. & a g e » an( * unless the mortgagee takes 
" possession, the mortgage, like a real-estate 



§165] The Law of Rights in Personal Property. 151 



mortgage, is not good against creditors unless it is 
recorded. 

164 Pled e- ^ ae difference between a chattel mort- 

e gev ' gage and a pledge, is that a pledge is always 
accompanied with possession of the chattel by the per- 
son making the loan; a chattel mortgage, if registered, 
need not be. 

There are millions of times as many agreements made 
regarding personal property as regarding land, for 
personal property is constantly traded, from the candy- 
shops to the stock-exchanges, by people who never have 
any land, and even professional dealers in land have 
to deal many times as often in personal property, in 
connection with the ordinary requirements of life 
4ck d 1 These facts of course make personal 

lo5. Personal oron- ,/»«■• r ^ . . 

erty the great field property the great field of Contract: so 
of contract. what time we can give to details of the law 
of personal property can best be used incidentally to our 
consideration of Contract. 



CHAPTER XIII. 



CONTRACT. 

As an Element in Civilization. 

166. Difference We have seen that men start with a right 
rfg%51Jnd Pr^ C erty to appropriate things from Nature, to 
rights. labor on them, and to keep the results. 
But rights to prevent a person taking or holding an- 
other's property are merely rights to prohibit something. 
Rights to demand something— demand another's things 
or labor, plainly can arise only by giving or promising 

. something in return. 

The modern state protects each party in his right to 
demand fulfilment from the other. 

167. Contract, Tne rights arising from such agreements 
agreement, bargain. are technically called Rights under Con- 
tract. Contract means nearly the same thing as 
agreement. But etymologically, agreement means 
something to the satisfaction of both parties, while 
contract means merely drawn together, or perhaps 
bound together, as we often say when a bargain is under 
way, that the people are trying to "get together". 
There is still a third word for that same thing — bargain. 
But the word "contract" having been more associated 
with law, has been kept more strictly to its early 
meaning; for instance, it seldom has anything to do 
with the profitableness of an agreement, while "bargain " 
is often used to mean merely a profitable transaction. 
A good contract generally means one that legally binds 

152 



§ 169] Contract as an Element in Civilization. 153 



the parties, while a good bargain means rather one that 
is profitable to one side or both. Yet each word is 
used in both senses. Bargain, tho, is never used in a 
general sense as one of the great foundation-stones of 
civilization, as we shall see that Contract is. People 
of low intelligence or low morality or both, sometimes 
break contracts, on the ground that they do not yield 
good bargains. 

*cq r^t^ ^ A slave or serf cannot make any con- 

108. Contract, oos- . , e , , J M - 

tlbie only to the tracts to speak of, because he cannot de- 
pend on keeping any ; he can only do what 
his master says. This affects his rights to property: 
for, as whatever he does is under his master's orders, 
his master takes the profit or bears the loss. If there 
is a loss — if crops turn out badly, for instance, the 
master is supposed to take care of the slave under all 
circumstances. 

Whether the system is good or bad, depends upon 
what it is compared with. Slavery would not be good 
in a civilized community ; but savages are so much like 
children that, if left to themselves, they would be more 
apt to starve, and rob and kill each other, than if an 
able man had absolute control to keep them in some 
sort of order, and tell them what to do. 

All societies that have reached civilization, have had 
to pass through conditions of slavery, serfdom and 
feudalage. 

Many societies have long stood still, like those of 
India and China — some until they could stand no longer, 
and were overcome or died out. Nothing higher than a 
vegetable can stand still and flourish — a society, a busi- 
ness, a human being, or even a beast, must progress — 
at least enough for exercise, or it will decay. It is like 
a person on a bicycle — he must move or come down. 

itta r««*«^ ... The way to teach a man to take care of 
io9i Contract an,. , - . J , . ... <• 

education in free- himself, is to leave him to take care of 

dom4 himself, just so far as safety permits. 

Obviously, a man cannot get ahead unless he can dis- 
pose of his own labor, and in the present state of man- 



The Protection of Rights. 



[§169 



kind, he cannot get ahead very far, in property at 
least, unless he can dispose of the labor of others. 
This does not mean unless he can enslave others: free- 
men co6perate with a man of true ability to their own 
good, as well as to his. 

The difference between the modern guide of labor 
and the slaveholder, is that the slaveholder, even tho 
he be incapable and unable or unwilling to take good 

170. Under Con- care of his slaves, can still force them 
employers can 6 to wor ^ f° r mm - The modern employer 
secure Labor. cannot force his laborer to work for 
him, because the modern laborer, especially with mod- 
ern facilities of travel, can contract where he pleases. 
He is not shut up on his master's place, as the churls 
and the villeins of England and the serfs of Russia 
and slaves of America were. The civilized laborer's 
power to contract, makes it necessary that his em- 
ployer should treat him both well and ably. Therefore 
the modern employer must be really able — capable of 
guiding his men well, and deserving his position, or com- 
petition will get his men away from him. And it is 
becoming more the case every day, that employers 
have to compete with each other to get the best labor; 
and he who best guides his labor, and cares for it so as 
to make it most vigorous, intelligent and cheerful, gen- 
erally comes out ahead in the competition, and makes 
most money. 

The scientific name for the primitive state of affairs 
where most men were obliged to stand still just where 
they were born, is status (the Latin word for standing). 
One reflecting upon the condition is tempted to suggest 
the English expression "stick-in-the-mud". The condi- 

171. Status versus tion where men can dispose of themselves 
Contract. and their property as they please, is called 
the condition of Contract. Wherever status, or "stand- 
ing", is the condition, if a man is born a ruler, important 
or petty, he stays one; if he is born a serf or peasant, 
he stays one. 

In quite primitive societies, there are examples, such 
as Mahomet and Genghis Khan, of people changing 



§ 172] Contract as an Element in Civilization. 



their standing very much, but they were only occa- 
sional men in generations: there could be only one 
now and then, because they rose by controlling men, not 
by contracting with them. In our day, nearly every 
civilized man can contract. 

The system of property-holding under 
SLnd&e which Mahomet and Genghis Khan rose, 

to°eSIer. a,,ev0,ve was communa l (54) » w ^ some slavery 
* ' and hardly any Contract. There is hardly 

any Contract under the communal system, because 
nobody has enough estate in the land to make much 
contracting with it, or its produce, possible. 

The property-system under which Hildebrand and 
Rudolph of Hapsburg, for instance, rose, was Feudal (55) 
with some little contract. There was more contract 
under the feudal system than under the communal, 
because the estates in land were much longer: at the 
outset of the system they were generally for life, and 
rapidly became transferable and even hereditary, tho 
always limited, of course, by the rights of the overlord. 

The system under which Lincoln and Garfield and 
Peabody and Peter Cooper rose, is of course the most 
advanced of all — private ownership and contract every- 
where. 

We find, then, Slavery, no Contract; Communism, 
hardly any; Feudalism, a little; Private Property, 
Contract everywhere. 

Under feudalism, the relation of each man to his 
feudal superior, was apparently one of contract to fur- 
nish so much military or personal service; or later, a 
certain portion of the products of his land. But reflec- 
tion shows that it was a contract only so far as a con- 
tract can be made by one side, and that side the stronger. 

As men have risen under all systems, of course there 
is no system where all men stand still. In other words, 
there has been no condition of universal Status or of 
universal Contract. All that the facts show is that the 
more Status and the more Communism, the fewer men 
rise; the more Contract and the more Private Owner- 



The Protection of Rights. 



[§ 172 



ship, the more men rise. Under the amount of Contract 
in the United States, a thousand men — probably ten 
thousand, possibly a hundred thousand, improve their 
condition, where one does in Russia or India, or did in 
mediaeval Europe or under the Turks or Tartars. 

The first marked decrease of Status and increase of 
Contract appears in the decline of Feudalism, which is an- 
other name for Militarism, and in the increase of Private 
Property. Militarism declined as civilization advanced , 

173 /Uthev * n s P* te °* * act tk at Europe is a col- 
evoiye, militarism lection of camps to-day. But those camps 
declines. have ensured peace in Europe since 1870: 

each nation has been merely playing soldier to keep the 
others from attacking it. Before 1870, there had never 
been ten years without war among them. 

The decline of Militarism was essential to doing away 
with Status, because extreme militant conditions are 
necessarily conditions of status: people 
a 7 foi^of a stotus. ls can simply command and obey: the enemy 
will not allow them any chance for divided 
policy, or much chance to do business or accumulate 
property. Hence it is only in civilized society that 
the chief activities, instead of being warlike or militant 
can be industrial. In a militant society, the men gen- 
erally do what they are compelled to; in an industrial 
society, they do what they agree to : so they are making 
contracts all the time. 

175. Fighting ver- It really is a question between a fighting 
sus producing. life and a trading life, or rather a pro- 
ducing life. With communal or feudal property, people 
never produced enough to get rich, and the only way 
people like those of India or Greece or Rome ever got 
rich, was by robbing somebody else. And as a fact, 
they never did get rich in the modern sense. A few 
people got rich, and made a great show, and did some 
fine work in art, literature and statesmanship; but the 
masses were slaves. 

175 <a). n, U8 trat«i *f on Z communal and feudal peoples 
in nations of to-day, it is about the same. There has 
to-day. nQt k een muc j 1 c hange in Russia and India 

and China, for instance, except in name. 



§ x 773 Contract as an Element in Civilization. 157 



Japan is the greatest instance the world ever saw of 
rapid growth in wealth, power and civilization; and she 
is an illustration of our thesis: her progress has been 
accompanied with the most rapid change ever seen of 
communal and feudal property into private property, 
of a general condition of status into one of contract. 
In Japan, too, despite some superficial appearances, 
private property and contract depended on the down- 
fall of militarism: in the barbarous and feudal sense 
of every man being a fighter and thinking of little but 
fighting, militarism has gone. The Japanese gentle- 
man does not now carry a sword much oftener than 
the English gentleman, and in Japan, despite the won- 
derful showing in her war with Russia, fighting is or- 
dinarily as much a matter of special profession as in 
France or Germany. 

The spread of the institution of private 
p 7 roperty y i3 wsen* property, then, as distinct from communal 
beiwdte! property (54) or feudal property (55), is 
necessary to change a condition of status 
into one of contract, because to do much contracting, 
a man must have property of his very own. If the 
community or the overlord owns all the real estate, 
there is not much personal property to contract with. 
No communal or feudal people ever got much personal 
property yet, unless by pillage. 

While wealth is not civilization, there never has been 
any broad and high civilization without wealth. The 
boasted poverty of Sparta, for instance, was accom- 
panied by virtual slavery of every man to the state, and 
by a general belief that skill in theft was a virtue. 

As, then, wealth depends on manufacturing and 
trading, we seem brought to the practical conclusion 
that civilization rests on people trading freely with 

177. Civilization eac ^ ot ^ er » ano ^ suc ^ ls ^he * act regarding 
and trade go to- all civilization except the sort built on 
gether. pillage and slavery, and that sort is nar- 

row and perishing. There never has been very high 
civilization enjoyed by the general community, without a 



The Protection of Rights. 



[§i77 



great deal of trading; and the higher the civilization, the 
more the trading. Then comes in the fact that there 
never has been much trading without the wide preva- 
lence of the institutions of private property and con- 
tract, and there is no reason in sight to believe that 
there ever will be; and then follows the conclusion that 
a producing, trading, contracting form of civilization 
is as much needed to produce from the ranks of the 
common people a statesman like Lincoln, as to produce 
a manufacturer like Peter Cooper. 
178. Breaking Con- ^ ^is demonstrates that a man who 
tracts and adfoca- breaks a contract is doing his mean little 
ting Socialism. share toward bringing the world back to 

the condition of status; and that a man who advo- 
cates socialism is trying to put the state in the place 
of the slaveholder, and so to lessen the amount of con- 
tract — to make government command what people shall 
do, instead of leaving them to contract to do what 
they please — in short he too would get us back to status. 

Here are two views on the subject that are worth 
thinking over: In 19.03, Grand Master Morrisey of the 
Brotherhood of Railway Trainmen said to his national 
convention : " We shall see the time when we will regard 
the contract-breaker . . . with as much contempt as 
we now regard the scab." C. P. Shea, President of 
the International Brotherhood of Teamsters, on trial 
at this writing for instigating the assaults and murders 
in the Chicago Teamsters' strike, said: " I do not con- 
sider anything a violation of an agreement, that is done 
to uphold the principles of trades-unionism." 



CHAPTER XIV. 



GENERAL LAW OP CONTRACT. 

Now we will consider the details of Contract. Courts 
do not want to use their time without reason — when* 
for instance, somebody claims that there was a con- 
tract when really there was none at all: so the courts 
have established a test by which to determine, when 
parties dispute, whether there really was a contract 
between them. 

179. Essentials of a To be a contract, there must be an 
Contract. offer by one side, an acceptance by the 

other, and a reasonable consideration why the offer 
should be made and accepted. 

All such considerations are found to be included 
under the three categories of something to be given, 
something to be done or refrained from, or natural 
love and affection. The Romans included it all (except 
natural love and affection) in four cases — I give to get 
you to give, I act to get you to give, I give to get you 
to act, and I act to get you to act.* 

But the subject is not really covered by something 
given or to be given, or something done or to be 
done: it may include something not to be done, or, 
as already said, something to be refrained from. A 
has a right to do something, B offers him something 
not to, A agrees. Now A does not agree either to give 
or do, but merely to refrain, yet he binds B to give or 
do what he offered as an inducement for the refraining. 

* Do ut des, do ut facias, facto ut des, facto ut facias. 

159 



i6o 



The Protection of Rights. 



[§i79 



Yet if we take "act" in the broad sense of a course of 
conduct, the Romans' pat way of putting it, does cover 
the idea of refraining being a "consideration". "By 
a man's acts shall he be judged" — "acts" there evi- 
dently includes temperance and self-restraint — refrain- 
ing from certain acts, as much as doing certain others. 
179 (a), niustra- Now to illustrate each kind of contract : 
tiona - A offers B a dollar for a plant ; each article 

is given that the other may be given. This is Roman 
case I. A offers B a dollar to do a day's work. This 
covers Roman case II. A offers B to do a day's work 
for a dollar. This is Roman case III. And A offers B 
. to do a day's work if B will take him for a drive on 
Sunday. This is Roman case IV. 

To illustrate the case the Roman summary leaves 
out — where the consideration is refraining from doing 
something: A has a lot next to B's, and proposes to 
build a wall that will shut out light and air from B's 
house; B offers him a thousand dollars to refrain from 
doing it: A refrains: B is bound to pay the money. 

It may be observed in passing (tho we shall return 
to the subject again) that while it may not be right 
to shut light and air out of your neighbor's house, it 
may be more nearly right than it would be to keep 
your own wife and children in rooms too small for them, 
or to have noise or anything else from your neighbor's 
windows disturbing them. 

180. Natural Love To illustrate a contract where the con- 
and Affection. sideration is natural love and affection: 
A father agrees to do something for a son with- 
out receiving anything in return. Now the law does 
not enforce mere gifts, but it will hold this to be a 
good contract, because it holds the natural love and 
affection to be a consideration. Yet that considera- 
tion seems queer, because if a father agrees to do some- 
thing for a son because he loves him so much, and then 
refuses to stand by it, he simply proves that he did not 
love his son that much — in other words, that there was 
no consideration ; all of which seems to show that where 
natural love and affection is alleged to be the con- 



§ 181] General Law of Contract. 161 

sideration, the contract may be a very weak one; and 
that where natural love and affection is strong enough 
to make a contract strong, there must be love enough 
to make a contract unnecessary. Yet there is a more 
logical view than that the father does it because of 
his own love for his child, namely, that the father makes 
the contract because tlie child gives him the 14 natural 
love and affection/ ' But, strange to say, I do not 
happen to have known this view presented elsewhere. 
Yet there is good reason, after all, why courts should 
support such contracts, even if the consideration is held 
to be natural love and affection entertained by the per- 
son making the promise: for if a man fails in busi- 
ness or dies, those who take charge of his affairs must 
carry out his contracts as far as they can, while his 
mere intended gifts, where there is no consideration, 
may frequently be set aside. So it is more merciful to 
his unfortunate family, to put his gifts to them on as 
good a footing as his business transactions. Yet, tho the 
courts will generally enforce contracts based on "natu- 
ral love and affection", unless there is also a " good 
and valuable consideration" they are apt to look with 
suspicion upon them, and to set them aside if they 
bear any strong indication of wronging creditors or 
later purchasers for valuable consideration. 

181. Promises and Of course entirely outside of any "con- 
Contracts, sideration" whatever, a promise ought to 
be as binding as a contract, in honor: because there 
should be no honor less than perfect honor; but it is 
not as binding in law, and this because, for many rea- 
sons, law cannot deal with so delicate a thing as honor. 
Justice is as high as law can go. 

We spoke (1636) of endorsements being made, like 
promises, without consideration, simply from friend- 
ship or favor. The question of whether the law will 
enforce them, of course cannot come up regarding the 
person originally responsible on the paper: for the en- 
dorsement is simply an obligation to pay, not the prin- 
cipal, but third parties, if he does not. But if those 



l62 



The Protection of Rights. 



[§181 



third parties are innocent holders for value paid, the 
law enforces the endorsement. Yet often the third 
party — a bank for instance, is not an "innocent third 
party", but knows that the endorsement is merely for 
accommodation, and yet takes the accommodation paper, 
just as it loans money at the market rate if it is higher 
than the legal rate, because it depends upon people 
to carry out their contracts without appealing to defects 
in the law. 

If paper has been forged, its possession for value 
by an innocent third party, does not make it good, 
unless the person whose name is forged can be held for 
some gross carelessness. The reason is that nobody 
ever undertook to pay it. 

Justice requires enforcement of contracts, and not of 
promises, because breaking a promise without consider- 
ation, takes nothing from the other man, while break- 
ing a contract takes from him whatever he does or gives 
on his side, or the thought and trouble and arrange- 
ments he may have been put to in making the contract, 
and toward carrying it out. To illustrate: if A is under 
promise to B and under contract to C, and then fails 
or dies, so that both cannot be satisfied, C, who has 
parted with some consideration, would suffer more 
than B, who has parted with nothing: therefore the 
law does what it can to protect the contract, while 
it pays no attention to the promise. 

But where natural love and affection is the consid- 
eration, C has. not parted with anything, and yet the 
law treats the case as if he had, because there would 
be so much hardship if the law should require the 
representatives of bankrupts or deceased persons to do 
as much to keep all promises alleged (perhaps falsely) 
by strangers, as to keep promises to relatives. True, 
people often love outsiders more than relatives, but the 
law cannot go into as fine points as that: proof is too 
difficult — natural love and affection — that is, such as 
it is natural, under ordinary circumstances, for all 
men to have, is as much as the law can attempt to 
take into account. 



§x8 3 ] 



General Law of Contract. 



163 



Le al fiction ^ * s un d°ubtedly something of a fiction 
. ega c on. ^ Q ma j ce 4t na t U ral love and affection" a 
"consideration", like money, or goods, or services, or 
self-restraint, but many of the greatest improvements 
in the law have been made by just such fictions (190). 
For instance: where people are damaged by others in 
their property and reputation, and come into court 
for redress, the principle of the law is that they must 
not only prove that the acts of which they complain 
really took place, but they must prove that the acts 
were damaging, and just how many dollars' worth; 
yet if a woman proves that she has been slandered 
in the dearest part of her reputation, the law brings 
in a fiction that she has been damaged by the slander, 
whether it fell on willing ears or not, and does not 
require her to prove that she was damaged. If she 
really was damaged, of course the law's assumption 
that she was, is not strictly a fiction. In this sense, 
fiction is a technical term meaning a general principle, 
regardless of whether it is true in any one case or not. 

As there is a tendency in fictions to do harm, it is a 
maxim of the law that fictions must never work injustice 
— that is to say: that when a judge finds that the 
fiction usual in somewhat similar cases, plainly does not 
justly apply to the case in hand, he must not decide 
as if it did. 

183. Mutuality in Now let us consider mutuality in con- 
contracts, tracts. It always "takes two to make 
a bargain". Contracts must always be mutual, — the 
understanding must be mutual, the consideration must 
be mutual, and the obligation must be mutual. 

First: the understanding must be mutual. If you 
say that to-morrow you will lend me a gun now in the 
hands of a friend, if I will bring a written abstract of 
ten pages of Spencer, and I agree to do it supposing 
you mean Spenser the poet, while you really mean 
Spencer the philosopher, there is no contract between 
us,- for our understanding is not mutual. If either 
of us finds out the misunderstanding, he should make 
a reasonable effort to let the other know that there is 



164 



The Protection of Rights. 



[§183 



no contract, so that in case the abstract of the poetry 
should not be a satisfactory substitute for the abstract 
of the philosophy, one may not lose the trouble of 
getting the gun, or the other of writing the abstract. 
It would be reasonable also to see if the parties could 
make the contract that one or the other intended — 
either for the abstract of the philosopher; or, if the 
other would not agree to that, whether he would be 
willing to make the contract he understood — regarding 
the abstract of the poet. 

The second point necessary to the mutuality of the 
contract, is mutuality of consideration — that is tojsay, 
as said before, each side must undertake to give or 
do or not do something, in consideration of the other 
side undertaking to give or do or not do something. 
For instance : if a man renders a service such as helping 
a horse and wagon out of a ditch, without the owner 
asking him to, or agreeing to do or give anything in 
return, he cannot make the owner pay. 

It seems hard not to be paid for valuable volunteer 
services, and any decent man would pay. Yet to 
admit the principle that volunteer services must be paid 
for, would overwhelm the world with superfluous and 
worthless pretexts of service — like, for instance, needless 
opening of carriage doors, and sweeping of crossings 
already clean. 

As farther instances, suppose A tells B that he will 
do something if B will do something else — that A will 
cook the breakfast if B will get up and light the fire. 
They are not under contract unless B says he will light 
the fire, or straightway does it, and lets A know that 
he has done it. 

Suppose A tells B he will do something, and B there- 
fore expects that he will. A has not contracted to do it, 
but has merely promised. 

184. Law and ^ n l aw a contract is more binding than 

Religion. a promise (as we have seen), or even than 

an oath. The reason is that an oath is a matter of 
religion, while the law deals only with justice. In 
modern times people know that it is as much a mistake 



§ 1 86 b] General Law of Contract. 



for law to try to handle religion as to handle honor. 
Now, for instance, witnesses need not swear on the 
Bible: they can merely "affirm", if they prefer. 
185. Justice and It might at first seem that in honor, 
Honor* one party to a contract should complete 

his side of the contract even if the other does not, 
because he has promised ; but the third point essential 
to the mutuality of a contract is that the obligation 
is mutual. If one side fails in his obligation, that 
releases the other ; and it does so in honor, because the 
dishonorable have no claims upon honor. And that 
is not reducing honor to the level of justice • because 
to permit the dishonorable to make claims upon honor, 
would be to reduce honor to injustice. Honor can 
never be contrary to justice. If, then, the dishonorable 
man has no claims, it might seem at first that anyone 
would have a right to deceive or rob him. But tho the 
dishonorable are not entitled to anything beyond 
justice, they are still entitled to justice. 

If one man agrees to pay another if he 
llw ^"wt* 5 the will kill a man or set a house on fire, and 
enforce. the other agrees, there is a contract, but 

dofng 0r wrong ' t ^ le ^ aw wil ^ not en f° rce it> because it is 
against public policy : the legal maxim is : 
"Men may contract, but not to do wrong." In a more 
extreme case : if one party risked his life and liberty to 
commit murder or arson, as there is no wrong in the 
mere payment of money, honor might require the pay- 
ment of even the wages of crime, but the law would not 
enforce it. 

186 (b) Wa era ^ ^ et ' t00 ' ^ aS a ^ ^ e cnaracter istics of 

agera. ^ contract, but the law will not enforce it, 
because betting adds nothing to the wealth of the com- 
munity, as a contract enforced at the expense of the 
community ought to; and because the habit leads a 
man to laziness and improvidence. And looking at the 
mutuality of bets, in the long run they are hardly so 
nearly an even thing that they can claim enforcement 
even on the ground of fairness: for in the long run, 



i66 



The Protection of Rights. 



[§ 1866 



those who lose must suffer more than those who 
gain enjoy. This requires a word of explanation: for 
in the long run, of course, bettors' fortunes must aver- 
age the same. Now assume that average to be any 
sum you please — say $10,000. Then, as President 
Hadley * points out, a man who loses $5,000 will lose 
what his family has come to regard as essential com- 
fort, and will suffer seriously, while the man who wins 
will not receive anything that his habits require, but a 
mere superfluity that he will be apt to waste as gamblers 
almost always do. In fact, often so unbalanced are 
the two sides that loss is suicide, and gain a brief 
period of dissipation — evil both ways, tho dispropor- 
tionate, and seldom if ever any real good either way. 

If one party to an alleged contract agrees to do 
something impossible — to drain the ocean or move 
Mount Washington, he is not liable in damages if he 
fails, because an agreement to do an impossibility is 
not a legal consideration. 

But if he agrees to do a reasonable or proper thing, 
and fails because of accident — sickness or a delayed 
train, he must pay damages: the misfortune is his, 
not that of the other party. 

186 (0). "The Act °f course ne can guard against acci- 

of God'or the Put>- dents in his agreement, as for instance, 
1 Enemy. carriers of goods generally guard against 
the " Acts of God and the Public Enemy", meaning as 
"the act of God", any convulsion of nature, like storm 
or flood or earthquake, or probably a sickness not 
brought on by a man's own fault; and as the act of 
the "public enemy", that of any foreign force with 
which we might be at war, or of a pirate at war with all 
mankind. A native mob or insurrection is not in- 
cluded in the legal definition. 

If a man agrees to do all the work he 
llif-pVese^sit?on S can possibly do, for less than will keep 
him alive, he should not go on until he 
dies, because it was a promise to commit suicide: that 
is not legal : so he is not bound by contract. Whether 
* "Economics." 



§189 General Law of Contract. 167 

he should go on and take his employer's money until 
he can find another place, and then leave his employer 
in the lurch, is not a question of contract, as there is 
no contract. It is a question of honor, and is brought 
up merely to help define the boundaries of the subject. 

But let us take another case of doubtful 
fumbhwlsdom* contracts. Suppose a man agrees to work 

for enough to keep him alive, but less than 
his production. It is a contract, because the law does 
not assume it to be either illegal or immoral to make 
a bad bargain, but only foolish; and the law cannot 
attempt to cure people of folly, or guard them against 
the consequences of it. 

189. Contracts which People can get into contracts without 
the law assumes, knowing it, just as they can get into other 
scrapes, through ignorance or stupidity. This seems 
not to agree with the earlier statement that there must 
be a mutual understanding, but in some cases the 
law assumes that there is, and will not listen to any 
evidence to the contrary. For instance : if a servant 
or mechanic or clerk is hired for any period — say a week 
or a month, and continues on without either side saying 
anything, the law assumes a contract for another pe- 
riod of the same length. So if a house is hired for a 
period so brief that a written contract is not neces- 
sary (82 6), continued occupancy after the period, with- 
out anything being said, leads the law to assume a con- 
tract for a second period, and so on indefinitely. 

The law also implies that any person employed to do 
any service shall receive "what he has deserved",* 
and also that the service shall be performed with due 
skill and faithfulness. If it is not so performed, serv- 
ants cannot get their wages, and would have to pay 
any damages caused by ignorance and carelessness. 

The' law may perhaps also be said to assume con- 
tracts that money is to be paid back (on demand unless 
specified) in any of three cases — when borrowed ; when 
spent, either for one's benefit by another with the bene- 
* Quantum meruit. 



1 68 



The Protection of Rights. 



[§ 189 



ficiary 's consent or in an emergency ; or received from 
any source in behalf of another. 

Similarly, if one takes any article having value, and 
nothing is said about price, one must pay "what it 
was worth",* and the seller cannot recover a price 
beyond that. 

If merchants keep an open account, a contract is im- 
plied that either will pay in case the balance is against 
him, whenever it is struck at the customary time. 

The law assumes these contracts as involving "the 
greatest good of the greatest number". They exist 
only by approval of long experience. 

The law makes a distinction between 

• soppe. these informal contracts and formal ones. 
In fact, it is sometimes hard to tell whether there is a 
contract, or what the law calls an estoppel, that is, 
whether one side or both are not in a position where 
they are stopped (or "estopped", as the lawyers say) 
from denying a contract, tho none may have been 
formally entered into. For instance, in some cases of 
renting and employing, if neither party had said any- 
thing until after a second term had been entered upon, 
a court might hold that both were estopped from denying 
the existence of a contract, and would have to act just 
as if there were one. There is another kind of estoppel 
called "estoppel by deed" produced by putting a seal 
on an instrument. After the seal goes on, the signer is 
estopped from contradicting anything said in the instru- 
ment. Otherwise he can contradict any statement that 
the other party has not acted upon. But action by 
the other party also has the effect of an estoppel. 

An assumed contract or an estoppel, seems very 
closely related to a fiction (182). It was said above 
that "in some cases ... a court might hold" that 
there was an estoppel. We were touching upon "the 
glorious uncertainties of the law": tho there are a 
great many exact rules, circumstances vary so much 
that it is hard to tell before a case comes to trial, what 
rules are going to fit it. 

* Quantum valebat. 



§ 193] 



General Law of Contract. 



169 



191. Carelessness Careless people, and the people who 
and Fraud. haunt the borderland between carelessness 
and fraud, often get into positions where they are es- 
topped from denying responsibilities that they did not 
really intend to undertake. 

Carelessness and fraud come pretty close to each other, 
because one who is careless about what he does, is very 
apt to become careless about what he says; and as 
careless people are constantly getting into scrapes, 
they are worse tempted than careful people to try to 
lie out of scrapes. A legal maxim that covers most 
cases where a man can properly be estopped from deny- 
ing an obligation, is that "No man can take advantage 
of his own wrong", and carelessness is a wrong. 

As to fraud, some authorities claim that there is an 
implied contract regarding it — that it is an implied part 
of every contract that there shall be no fraud. But 
that seems drawing it unnecessarily fine. The matter 
seems covered by the general principle of the law — 
to enforce no contract where there is fraud, and always 
to give damages against fraud. 

192. Fraud never J us ^ what constitutes fraud, however, 
defined. the law is very careful not to say : because 
human wisdom could not frame a definition broad 
enough to cover all possible cases of fraud, any more 
than all possible cases of any other kind; and even if 
it could cover all cases of fraud heretofore known, the 
ingenuity of the wicked would invent new cases not 
covered by the definition, and so escape. Therefore, 
the court has to determine each case. A fairly intelli- 
gent court can follow the serpent's track more flexibly 
than a rigid definition could. 

No transaction, whether based on contract or not, 
can stand after it is found to be fraudulent, provided 
suit to set it aside is brought within a reasonable time 
of the fraud being discovered — for agreements not under 
seal, in most of our states, six years. 

193. Statutes of A limit to the time is secured under 
Limitations again, the statutes of limitations (82 £) which 



170 



The Protection of Rights. 



[§ i93 



were passed largely to protect innocent persons. A 
long time after a piece of wrong-doing, it would be very- 
easy to blackmail : for it would then be easy to manu- 
facture evidence that could not be refuted. 

Moreover, after many years, when the person who 
perpetrated the fraud might be dead, it would hardly 
be fair to have somebody coming down on his heirs. 

194. Force vltlitw; Fraud is not the only condition that will 
contract. vitiate a contract otherwise good: an as- 
sent obtained by force or threat is no more valid than 
one obtained by fraud. 

« 

Of course fraud and crime take up a great deal of 
time of the courts, and of course the courts (not to 
speak of the police, jails, reformatories and prisons) 
cost the taxpayers a great deal of money. Yet if every- 
body were honest, we could not get along without 
courts, unless everybody were wise too : for 

195. Courts needed various sorts of unwisdom often tangle up 
if much , fs norance people's rights so that thev have to go 
against Fraud. j n t court to find out what tneir rights are. 
^ifXfot Take a case of what is called in law 
MeM™ 'suits 1 ' con ^ us i° n ' ' of one person 's materials with 
ren y su a. ano ther person's labor — a man building a 
house for another, or a woman making an expensive 
frock, may get it all wrong and spoil a lot of good mate- 
rial, and yet suppose that it was being done right, per- 
haps because the owner of the materials may have failed 
to give clear directions. Again, intricate questions con- 
stantly arise over the meaning and effect of old contracts, 
or of provisions of wills, as well as of statutes passed by 
legislative bodies ; and as somebody must put a working 
construction on them, that is generally done by the 
courts. Honest people are getting into disputes over 
such matters all the time, and many suits are, even in 
fact as in name, " friendly " — simply to get a matter 
settled in one way or the other, when the parties do 
not care which way. Such cases are perhaps most 
frequent when people are acting for others — executors 
for estates, guardians for minors, trustees for corpora- 



§197] 



General Law of Contract. 



171 



tions; and to avoid liability themselves, they must be 
sure to act legally, so they need an authoritative decree 

196. Contracts ^ ot a ^ contracts af e made by people 
when parties do face to face : many are made by mail, tele- 
not meet. graph and even telephone. 

A man making an offer in a letter, is not bound by 
it before the other party has posted his letter of accept- 
ance. Most judges have decided that the acceptor can- 
not revoke (say by special messenger or telegram) be- 
tween posting his letter and the receipt of it by the 
man who made the offer, but there have not been 
enough cases tried since the telegraph came into gen- 
eral use, for the subject to have been so thoroughly 
argued that all judges are now agreed. 

Tho the offerer has a privilege of revoking until his 
offer is accepted, the acceptor should not have the same 
privilege until his acceptance is received, because, for 
many reasons, the general principle of law is that a 
contract is made when both parties consent to the same 
thing. It is of course important to fix the time of 
this consent. A man may write a letter of acceptance 
without being at all sure that he will post it, but post- 
ing it is the last thing he can do with it, and when 
he does that, it is reasonable to conclude that his 
mind is then made up, and consequently, that at that 
instant the parties are agreed, hence that the contract 
is made, and therefore that neither can revoke. Another 
argument is that the proposer has made the mail and 
telegraph operators his agents (214) to receive the ac- 
ceptance, and that consequently, when it is delivered 
to them, it is legally delivered to him. 

And yet this view does not seem so free from doubt 
that it ought to be finally considered as the law. There 
is certainly room for a great deal more argument, as is 
shown by the fact that judges are not 
evoiution. ,aw ls a " y et absolutely agreed, and the only safe 
way is to make a proposition subject to 
the proposer receiving word of its acceptance by a 
specified time. 



172 



The Protection of Rights. 



[§i97 



And doubt has certainly at some time covered 
most questions that are now clearly settled: nearly 
all the matters that seem very simple ones to us, 
were by no means as simple to our ancestors. For in- 
stance, take as simple a thing as regard for human life. 
When a sovereign kills a subject who displeases him, our 
ancestors, even as late as Henry VIII. — yes, as late as 
James II., would have differed as to whether it was a 
legal execution or a murder. But now, if our Presi- 
dent or one of our governors were deliberately to kill 
an unoffending man, it would be a murder; and even 
as to the sheriff who hangs or electricutes a man nowa- 
days, a great many people think that any voluntary 
killing of a human being, except in immediate defence 
of one's self or another, is wrong, and will some day 
be against the law. 



CHAPTER XV. 



LAW OP CONTRACTS CONCERNING PERSONAL PROPERTY. 

So much for the general principles of Contract ; and 
as to our last few words on the uncertainty and evolu- 
tion of law — that is a topic to which we shall have to 
revert more than once. Now let us examine into some 
of the specific laws of different kinds of contracts, be- 
ginning with such an every -day matter as selling and 
delivering property. It is not always as simple as we 
are apt to think. 

Suppose I have a horse and want you to buy him. 
You say you will give me $100 for him, and will bring it 
next day; and I say: "All right, I'll send him to 
you"; and we separate. Suppose I change my mind. 
Can you oblige me to sell him ? * No : for under the 
Statute of Frauds (82 b) a contract for 
198. Sale and De- over $50 (later legislation varies it in the 
ral^a* gener- different states from $30 to $200) must be 
any affected by put in writing, at least unless there was de- 
t Frauda t t uie ° f livery of money or something else from 
one side to the other, or some other part- 
performance. Here neither horse nor money was de- 
livered. 

Let us note in passing that the law also requires to 

* While I have had to realize the failure of the dialogue form 
in which the earlier editions of this book were written, it seems 
so peculiarly adapted to the topics of this chapter, that I have 
ventured to retain some traces of it for them. 

173 



174 



The Protection of Rights. 



[§ 198 <* 



be written, or partly performed, all contracts relating to 
real estate (except a lease for a year or less in New 
York — in some states, three years or less), or to becom- 
ing responsible for somebody else, or making a trustee 
personally responsible for the benefit of a trust estate 
(218), or to something to be done more than a year 
afterwards, or where the consideration on either or both 
sides is a promise to marry. 

The law requires these formalities, because the obli- 
gation of Contract is so great, and the necessity of 
performing contracts, and of the law's enforcing them, 
so important, that it has been found wise to make 
people cautious in entering into contracts, and to 
guard people from getting into them too easily. More- 
over, where contracts are specially important or pecu- 
liar, the law wants better evidence of their existence 
and nature, than mere memory of spoken words. 

Probably no statutes have ever had wider effects than 
the Statutes of Frauds. But it is a most instructive 
comment on the uncertainty of legislative wisdom 
that many good lawyers think these statutes have en- 
couraged more fraud than they have prevented. 
198 (b). by Part To return to our contracts in selling 
Payment. an( j delivering property : if you had given 

me $5 on account of the horse, he would then be under 
contract of sale, the $5 being consideration to bind 
that contract. I could not then sell him to anybody 
but you, and give you back your $5. Thus for personal 
property, part payment will bind in the absence of 
writing. 

If the matter in hand, instead of a horse, were a thou- 
sand bushels of oats which we had agreed upon a sale of, 
and you had paid me for only a bushel, our contract 
would be good for all. 

If you had paid for none, but I had put a bushel in 
your buggy, part delivery would be as good as part 
payment. 

But coming back to the horse, suppose I had been 
too good-natured, and endorsed a friend's note (1636), 
and were to find on my way home that the sheriff 



§ 2oo] Law of Personal-Property Contracts. 175 



had taken the horse to pay the note after you had 
paid the $5. Is he still my horse? Yes, he was mine 
198 (e) Prior Lien unc ^ er contract of sale. But if the entire 

e . ror en. ^een <p a {d before the sheriff took 

the horse, the sheriff took your horse. It would be 
necessary to fix the time of both events. But that 
would not be easy, and as "possession is nine points 
of the law M , the outcome would probably be that the 
sheriff would hold the horse, and I would have to 
return your money. 

Should the horse be killed while in the seller's pos- 
session, it would be the buyer's loss only if title had 
actually passed — if, for instance, either party had said, 
without contradiction, words to the effect that it was 
the buyer's horse, and that the seller had a claim on 
the buyer for the rest of the money. But until such an 
arrangement is definitely made, or until the horse is 
delivered, it would still be only a contract of sale. 
But the buyer has a first claim on him for any 
money he may have advanced before getting posses- 
sion. 

Such a claim is usually called a lien, which means in 
law a right to sell property to recover some claim 
against it. Next to mortgages and judgments, the 
most frequent liens are those of mechanics against 
things — especially houses, that they have made or 
repaired. 

Now to return to the horse-trade. Suppose the horse 
had been paid for, but there was not time to make a good 
delivery before the sheriff took him, how 

199. No one can sell is the buyer to get him? The law would 
moretltlethanhe ^ h[m tQ the buyer> wherever he is 

The sheriff can only sell whatever title the 
seller had in him, and after he was paid for, the seller 
had none. 

That would of course be hard on the man who had 
bought him from the sheriff, but he would have a right 
to get back the money he had paid the sheriff. 

200. Possession If tne $ IO ° nac * Deen paid, the horse 
and ownership. would be the buyer's property, as against 



176 



The Protection of Rights. 



[§ 200 



all previous claims, except a registered chattel mort- 
gage (163 e), even tho he remained with the seller. 

If he burned up in the stable before the seller had 
time to deliver him, it would be the buyer's loss, but 
the seller could probably still collect insurance on him, 
if he had any, because policies generally cover 44 goods 
sold and not delivered", but if the buyer had paid, 
and the seller should collect insurance, he would have 
to pay it to the buyer. 

But suppose farther that the seller had paid some 
bills with the $100 on the way home, and the sheriff 
had said: "Well, if you've just sold this horse for 
$100, show me the money: I'll take that", and upon 
the seller's failing to show the money, the sheriff had 
said that he did not believe the seller had sold the 
horse at all, and the sheriff had taken him and sold 
him. He would still be the buyer's horse, no matter 
in whose hands the sheriff might have placed him, and 
the buyer would have a right to take him wherever he 
could find him — not to take him by force, however: 
because, as already said, no man can legally use force 
except in self-defence, or in arresting for crime: in 
201. Owner must otner cases » ne must appeal to the law. 
not secure posses- The buyer could enter another man's 
sion by force. stable to get his horse, but only without 
force. If force is used, it must be by due process of 
law. 

Suppose the seller had not paid the bills with the 
hundred dollars, and when the buyer sent for the horse 
and found him gone, he were to prefer the money to 
the horse with the trouble of following him up through 
the sheriff's hands, and so he were to ask for the hundred 
dollars back, would the law give it him? Perhaps 
the seller ought to, as he would have got the buyer into 
the scrape, but the law would not. The buyer could 
reasonably try to get his horse, but it would be absurd 
to try to get the seller's money. It is now the seller's 
hundred dollars, and it was the buyer's horse that the 
sheriff took. 



§ 202 a] Law of Personal-Property Contracts. 



177 



202. Delivery and ^ t ^ le se ^ er ^ad na( * time, before meet- 
acceptance complete ing the sheriff, to send the horse to the 
ownership. buyer's stables, tho the buyer had not paid, 

the horse would have been the buyer's, and the seller 
would have had a good claim against the buyer for $100. 
202 (a). Dethery The same would have been the case if 
toageni or carrier the seller had given the horse to the ser- 
gow ^' vant or any other agent of the buyer 

before the buyer paid for him. 

If the seller had started him for the buyer's stable by 
the seller's own servant, and the sheriff had met him, he 
would, unless paid for, still have been the seller's horse. 

We have seen then that the ways in which the transfer 
of ownership of personal property can be effected, are 
by paying for it, or delivering it on the buyer's premises, 
or other premises named by the buyer, or delivering 
it to him, or to a person properly acting for him. 

Accordingly, in shipping goods, they become the 
buyer's upon his paying for them, or upon delivery 
to a carrier named by him, or to any common or public 
carrier, unless he had ordered a different one. Probably 
there would be an exception to the last rule in cities 
where dealers generally deliver the goods they sell, and 
sometimes do so by public carriers. Probably a court 
would hold that a dealer in goods usually delivered at 
the house, is bound to deliver at the house unless he 
warns the buyer that they go at his risk. 

Upon delivery of unpaid-for goods, tho the seller no 
longer owns them, he has in place of them, a claim on 
the buyer. He should not deliver them unless he 
thinks the claim is practically worth more to him than 
the goods. 

If the buyer named one carrier, and the seller de- 
livered to another, the goods would be the seller's until 
the buyer received them, unless it was impossible to 
deliver them to the buyer's carrier, and the seller had 
used proper diligence to get as good a one as possible 
in his place. 

In such a case, however, if the goods had been un- 



i 7 8 



The Protection of Rights. 



[ §202 a 



reasonably delayed or damaged or overcharged for 
freight, the buyer would not be bound to receive them. 
He would, however, be bound to pay the charges of a 
carrier he did not select, unless excessive; if excessive, 
he would have the choice of refusing the goods or of 
claiming the excessive charges from the seller. 
203. Conditional Suppose the buyer had not seen the 
• a|e - horse, but had only said: " I like your 

description so well that if he comes up to it, I'll take 
him", still he could not be the buyer's before he had 
accepted him, even if the seller's groom delivered him, 
and the buyer's groom accepted him, unless the buyer 
had given his groom special authority to judge and 
accept him. But if, after hearing the seller's descrip- 
tion, the buyer, without seeing the horse, had said: 
"All right, I'll take him", he would have had to keep 
him unless he was ready to say the description had not 
been just. 

If the buyer had said: "I'm going away, but I'll 
come and see him within a month", and the seller had 
said: 44 All right, I'll keep him for you", it is a com- 
plex question whether the seller would have been under 
contract to keep him. What really passed between the 
204 tlon parties was that the owner gave an option, 
p on ' and the question is how much that option 
was worth. If it was worth more than $50, the agree- 
ment to keep the horse, and agreement to go and see 
him, do not make a contract, without writing or pay- 
ment on account. We must distinguish between an 
option and a contract of sale. Now an option has value : 
one party has all the advantage, and generally he should 
pay for that advantage. He can buy or not : if values 
change, it is a case of heads, he wins; tails, the other 
loses. But in a contract of sale, the chances are even, 
if other things are even: for change of value before the 
contract is completed, is as apt to be on one side as 
the other. Accordingly, the mere right to buy goods if 
wanted (or leave them alone if not wanted), is often 
matter of bargain and sale — quite possibly more often 
than goods themselves, especially in some classes of 



§ 206] Law of Personal-Property Contracts . 179 

goods. In grain, perhaps the option sales amount to 
more than the sales of actual goods. The same may 
be true of some stocks. 

Suppose there had been a defect in the 
mwtKdMSd. 1 horse - Was the seller bound to tell of it? 

If questioned, he must answer honestly, 
if he answers at all. But he has a perfect right to say: 
"There is the property ; judge it for yourself." Here ap- 
plies the maxim of law: "Let the buyer look out for 
his own interests."* This applies specially to horse- 
trades, but also to all trades where the buyer has full 
opportunity to examine. Some very honest people often 
refuse to say anything about their wares — especially 
their horses (For now and then, perhaps, a man can 
sell a horse without losing his honesty), because they 
fear that there may be defects of which they themselves 
are not aware. 

Yet the principle of refusing to disclose a defect 
when it is known, is not good, but it is like something 
discussed before: it is more in the field of honor than 
in the field of law. It would be very hard to enforce 
laws requiring it, and it is unwise for the law to attempt 
more than it can do: because failure is very apt to 
lessen the respect in which it is important that the 
law be held. 

But there are cases in which a man is bound to tell 
the whole story: an employee or a person acting for 
another in any capacity, is always bound to tell his 
principal all essential facts. For instance, if a gentle- 
man sends his coachman to look at a dealer's horse, 
the coachman is bound to tell all he finds, while the 
dealer is not. 

A seller also, if he warrants his wares, 

206. Warranty. mustj m self . defence| tell how far he war . 

rants them. Whether the contract of sa^le implies a 
contract of warranty, is a very complicated question. 
In ordinary cases, the two contracts are separate, and 



* Caveat emptor. 



i8o 



The Protection of Rights. 



[§206 



extra price is often paid for warranty; but in danger- 
ous cases, like drugs and food, the courts would prob- 
ably imply warranty with sale. Of course, as often said, 
the law insists that there shall be no fraud, but cannot 
always insist on things being usable for the purposes that 
they are sold for. That point opens up an enormous 
number of mixed and delicate questions. Probably 
the farthest the law could go in any case, would be to 
punish fraud if proven. 

A large and interesting class of contracts closely 
allied to warranty, includes those of suretyship — guar- 
anteeing that the responsibilities of another 

• ureys p. person shall be performed. This, of course, 
includes endorsement, which we have already treated 
(163 6). Even where one has had no real interest in a 
piece of negotiable paper, if he puts his name on the 
back of it, the law assumes a right in any subsequent 
holder, on giving prompt legal notice, to claim its value 
from him. He becomes surety for it. 

An endorsement is in writing; but if, in our horse 
case, the buyer had said that his finances were not in 
good shape, and a friend standing by had said: " Well, 
if it turns out that he can't pay you, I'll help him and 
see you made good," the speaker would not have been 
bound. Under the Statute of Frauds (82 b) any "con- 
tract to answer for the debt, default or miscarriage of 
another", must be in writing, and signed at least by 
the party who may have to answer. 

Suretyship and warranty shade into 

. nsurance. ano ther large class of contracts embracing 
all kinds of insurance. Fidelity insurance is especially 
like suretyship, but also fire, marine, accident, life, 
plate-glass and all the rest, are of course of the nature 
of warranty; but the warrant extends, unless otherwise 
agreed in the policy, not necessarily to the full amount 
of the policy, but only to the value of the property 
at the time of loss. Hence the desirability of keeping 
the policy small, or having it declare that the amount 
insured for shall, in case of loss, be taken as the value 
of the property. Life-insurance companies, however, 



§ 209 a] Law of Personal-Property Contracts. 181 

aire always liable for the full amount of their policies. 

Bailments ^ e come now to ^ e wide questions of 
a men s Bailment, from the French baillcr, to de- 
liver. That is the law term for placing movable prop- 
erty in the possession of somebody not the owner, or 
for the relations arising from such placing of any prop- 
erty. It will be noticed that that is different from the 
delivery which changes ownership. In bailment, the 
owner and receiver are called, respectively, bailor and 
bailee. Now suppose in our horse case, the seller had 
delivered the horse to a railroad company, and they 
had failed to deliver him to the buyer: if he had been 
killed by an accident on their road, they would have 
had to pay the seller for him, unless the accident was 
caused by "the Act of God or the Public Enemy". 

Very early the law made common carriers responsible 
for the acts of highwaymen, because they were so 
often in collusion with them (202 a). We are defence- 
less against 4 4 the Act of God", but the owner would 
have a chance of recovering the horse's value if he 
were taken by the public enemy: for in the case of 
war, if the government were to get an indemnity, it 
would perhaps pay such private claims; and in the 
case of riot and insurrection, the citizen has a good 
claim against the state for not preventing the trouble 
or suppressing it before damage is done. 

For any other matter sent by freight or express, the 
company's liability would be the same as for the horse. 

The liabilities of common carriers are 
l^kinia of d go^a t the same for all sorts of property, except 
that they are not responsible for deteriora- 
tion in perishable goods like meat and fruit, unless 
there is special agreement regarding time of delivery. 
They can protect themselves by charging different rates 
for articles that differ in durability or strength, and 
they may perhaps altogether refuse extra-hazardous 
articles — like dynamite, tho they do not if they can get 
paid enough. 

Probably if a railway company sells a ticket presum- 



182 



The Protection of Rights. 



[§ 209 a 



ably for a particular train, it is bound to provide a 
seat. This would hardly hold, however, where a num- 
ber of tickets are sold to be used at pleasure — com- 
mutation tickets for instance. A passenger who can- 
not find a seat in a common car, may take one in a 
parlor-car or a sleeping-car without extra payment, 
until one in an ordinary car is vacant. 
209 (b). "Common A "common carrier " is a carrier for pay, 
Qamer" defined. Q f virtually anything that offers. 

If one travels and checks his trunk, whether the 
company is liable for any amount of value in the trunk, 
is a very doubtful case, and has often been decided 
each way. The weight of the decisions now makes the 
companies liable for ordinary non-business baggage, even 
up to the outfits of sportsmen, and most elaborate cos- 
tumes of ladies. 

Handbags are at the risk of owners, so would be 
valuables not properly constituting personal baggage in 
trunks. 

The carrier's responsibility for horses is weakened 
(tho not always destroyed) by their being in charge of 
the owner or his agent. 

209 (o. Limiting Confusion in the law has resulted from 
Liabtiiti without differences of opinion as to whether a com- 
eontraot. pany can relieve itself from liability by 

printing on tickets (as it always does) that its liability 
shall be restricted to a certain amount. While that 
cannot make a contract unless the passenger agrees 
to it, the companies' lawyers claim that in accepting 
the ticket, he does agree. The question ought to be 
settled by statute, but probably the companies influ- 
ence the legislatures not to settle it in one way, and 
fear of constituents prevents the legislatures from 
settling it the other way. 

If the passenger has not even read what was printed 
on the ticket, the companies claim that one takes the 
ticket on his own risk, and ought to read it — in short, 
that the ticket is a sort of bill-of-lading. 
209 (d). Biu-of- A bill-of-lading is a carrier's receipt for 
Lading. goods. These were issued long before 



§ 209 f] Law of Personal Property Contracts. 183 



passenger-tickets were — even when people used to 
travel only by horse and carriage; so the law of bills- 
of-lading was evolved and settled long before there 
were any passenger-tickets. A man consigning goods 
to a carrier is bound by anything on his bill-of-lading 
that is not against the law; therefore, if he is wise, 
he will know what is on it before accepting it. Per- 
haps the judges would decide that passenger-tickets 
are to be put on the same footing as bills -of -lading, 
were it not that when a queue of people is waiting 
before a ticket-window, and the train is soon to start, 
it would not do for each one to have to read his ticket 
before accepting it. Moreover, as railroads are chartered 
for the public convenience, they should not be per- 
mitted to restrict it needlessly by their one-sided 
alleged contracts. The general tendency of the courts, 
however, is very properly in favor of the shipper, as 
the companies are too apt to act as masters of the 
situation. 

««« Now take another case of one party's 

209 (e). Hiring, -u-v,. r . . , ^ J A 

responsibility for returning the property 
of another: if the railroad company were hiring the 
horse, and paying for the use of him instead of carrying 
him somewhere for pay, it would still be responsible 
to return him unless prevented by the act of God or 
the public enemy: he becomes for the time of hiring, 
the company's horse, and it undertakes to return him 
(or his value) when the time of hiring is past. 

If while he was hired, a thief had taken him from 
the stable, the hirer would have to find him; or if the 
hirer could not find him, or if the thief drove him to 
death, the hirer would be responsible to pay. 
209 (fh The Law There is an exception to this responsi- 
does not require bility, where, at the time of hiring, some 
impossibilities. condition exists making it, in the nature 
of things, impossible to return the hired article — for 
instance, if, when the horse is delivered, he has a mor- 
tal disease that carries him off while he is in the bailee's 
hands. But if he catches grip while in the bailee's 
stable, that is the bailee's risk. 



The Protection of Rights. 



[§ 209 / 



If he is vicious and runs away and kills himself, if 
the bailee could prove that he was habitually vicious, 
the bailee would not be responsible; and if the bailor 
knew it (as in that case he presumably would), the 
bailee could even get damages for any harm the horse 
might do him. 

If he is burned up, that is the bailee's risk, too, but 
of course bailees can insure against it, or bailors can 
when bailees are not reliable. 

The same principle of liability holds for all sorts of 
property, if left for the bailee's use. 
209 Bailment If anything is received without pay— 
without consid- solely for the bailor's convenience — for in- 
eration. stance, jewelry or a picture that one does 

not want to store with ordinary furniture, the bailee is 
under no responsibility, except for the grossest careless- 
ness. Similarly, if, as is often the case, an express com- 
pany deadheads a private package for a man who gives 
the company much business, the company is responsible 
only for gross negligence : there has been no considera- 
tion making a contract to deliver safely. But if, for 
instance, a bailee had borrowed a horse, the bailment 
would have been for his own benefit, and he would have 
been responsible — as responsible as if hiring, and more 
responsible in honor, as the owner gets no benefit ; and 
accordingly, a judge and jury would be more apt to 
throw all the points against the borrower. 
209 Liability Suppose the borrower had gone off for a 
of innkeepers. driving tour, and stopped at a country inn, 
the landlord putting the horse in his stable. Would 
his responsibility to the borrower be the same as the 
borrower's when the horse was in his stable? Prob- 
ably it would be stronger. Generally an innkeeper's 
responsibility for the property of his guests has been 
the same as that of a common carrier: perhaps, tho, it 
may be doubted whether this responsibility would ex- 
tend to the stable. 

Yet while the early law made by the decisions of the 
judges, was as stated, many statutes have been made by 
legislatures to exempt the landlord from responsibility — 



§ 209 i] Law of Personal-Property Contracts. 185 



for instance, for jewelry and valuables unless these are 
specially put into his hands, provided he gives notice 
to that effect. In some states, to relieve himself of 
responsibility, he must put such things into an iron 
safe. Perhaps this general tendency to relieve him 
of responsibility would influence judges as far as the 
stable. 

Approximately, the innkeeper's responsibility indi- 
cates the responsibility of all other bailees for pay, tho 
as he was one of the earliest bailees, and as in early 
times the law could take much less account of circum- 
stances than it learned to in the course of its evolution, 
the law is rather harder on the innkeeper than on most 
bailees. 

The rigor of the common law with innkeepers arose 
from its having taken shape at a time when innkeepers 
were apt to be in collusion with highwaymen and other 
thieves. 

The innkeeper is also obliged to keep his place in 
sanitary condition and furnish wholesome food. 
209 (i) Pted e Suppose the owner of our horse had 
e g *' borrowed fifty dollars, and had left the 
often-aforesaid horse as security : he is not for the time 
as much at the risk of the lender of the money (called 
the pledgee) as he would be if he hired or even borrowed. 

As a pledge, the lender must return him in good order, 
if he will permit ; but if he gets sick and dies, the pledgee 
is not responsible, as he would be in hiring. It must 
be admitted, however, that horse cases are harder than 
most other cases: a horse is more apt than a load of 
stone, for instance, to get sick and die, and the diffi- 
culty of horse cases is one of the reasons why I have 
used them. More changes can be rung on a horse 
than on a load of stone. 

Courts hold people regularly receiving pledges, such as 
pawnbrokers and stockbrokers, to very strict accounta- 
bility, yet if a horse dies, or anything goes wrong with 
other perishable property in a bailee's hands, even when 
hired, and the judge were to tell the jury that in strict 
law the bailee was responsible, and that they must fix 



i86 



The Protection of Rights. 



[§ 209 i 



the value, they would be apt to fix it pretty low. The 
situation is one of the many where "the glorious uncer- 
tainties of the law" are specially uncertain. But yet 
there is a general principle that runs through it all, and 

209 (J). General wnicn would influence both judge and 
principle of ua- jury. The law of bailment has been 
tiuty of Bailee*. evo \y e( ^ f rorn suc h varying circumstances 
that, in many departments, it has hardly settled down 
according to principles. It seems tending, tho, to 
make the liability — the amount of care required from 
the bailee, vary with the advantage he derives from the 
bailment : if he gets no advantage, as in taking to accom- 
modate the bailor, he is responsible only if he is grossly 
negligent; but if he gets an advantage, as in borrowing, 
or hires an advantage worth paying for, as in ordinary 
hiring, he must take good ordinary care, and that 
will not always save him ; but when we come to bailees 
who make their living from their bailments, such as 
common carriers, innkeepers and holders of pledges, 
they must take all possible care, and even then they 
are not always safe in case of loss. 

210 Tender Where a . party admits that he owes 

en er ' something, but there is a dispute about 
the amount, it is wise promptly to make a tender of 
what he thinks he ought to pay. Otherwise he could 
not claim the performance of any of the agreements 
that his opponent hesitates about ; and in some states, 
if a seller tries to back out of a contract for goods, 
and the buyer makes him a tender, the goods become 
the buyer's property at that moment, even despite the 
seller's wish, and only the amount to be paid remains 
to be adjudicated. 

Moreover, if the court should decide that more was 
owed than had been tendered, if no tender has been 
made, the debtor would have to pay interest on any 
sum the court decides due, and the costs of the suit. 
If a tender has been made, the debtor would not have 
to pay interest up to the amount tendered, or any costs, 
unless the court should decide more owed than the tender. 



§ 2 1 1 ] Law of Personal-Property Contracts, 187 



But in some cases the acceptance of any tender has 
been held to discharge the debt. 

A check is not a legal tender. The check 
mon ( By'in. ,ndgof might not be good. Pennies are legal 
tender only up to twenty-five cents. Sil- 
ver small change is not legal tender for over ten dol- 
lars. Silver dollars are legal tender for any amount, 
in the absence of contract to the contrary. Silver 
certificates might be expected to be legal tender only 
for public dues. Gold English sovereigns are the best 
money in the world, but foreign money is not legal 
tender. Legal tender in America is only American 
money — copper, nickel and small silver only in the 
small amounts stated, and gold coin, silver dollars 
and government legal-tender notes in unlimited amounts, 
tho contract can be made against all but gold. 

The reasons why some kinds of money are legal ten- 
der, and others not, are: that a debtor should not 
be able to force a creditor to take a cartload of copper 
for a thousand-dollar debt, or a cartload of silver for 
a ten-thousand-dollar one, if the creditor has not been 
wise enough to contract against either; much less should 
he be obliged to take a check that it is possible the 
bank may refuse. So it is necessary for the law to 
determine what he shall take. This is done by Con- 
210 (t). Deter- gress, of course : as the Constitution gives 
mined by Congres: Congress the sole power to coin money, it 
alone can say what is money. 

The Supreme Court has virtually decided that the 
power to coin money includes the power to print paper 
money, or at least that the power to raise money in- 
cludes that of raising it by issuing legal-tender notes; 
but many of the best lawyers still think it does not. 

211. Contractual A minor is incapable of • making con- 
Disabliitles. tracts, except for necessities. Formerly, 
and perhaps still in some states, married women can- 
not contract, and everywhere idiots are unable to. 

If, for instance, a minor's doctor recommends him to 
ride horseback, and he refuses to pay for a horse he 



i88 



The Protection of Rights. 



[§2II 



has hired, a jury would have to decide whether, con- 
sidering his health and circumstances, the horse could 
be called a necessity. Should the jury agree that the 
212. Some limits norse was a necessity, as there was no con- 
of Quantum tract (the hirer being a minor), the owner 
aeat * still could recover for the hire, on the 

ground that anybody who supplies a minor with a 
necessity, may recover 4 'what it was worth" — Quantum 
vaiebat (189). This principle of quantum vaiebat is 
not applied only to supplying minors altho they can- 
not contract, but it applies when anything really making 
212 (a). Enrich- an 44 enrichment " is supplied, even by mis- 
ment take. Tho in ordinary language a minor 

or anybody is not 44 enriched " by riding a horse, he is 
in the legal sense, if it does him good. Even if it does 
not, he would still have to pay for it, if good judges 
had recommended it. 

But if he had been supplied with something harmful, 
as too much whiskey, for instance, the seller could not 
recover. 

The question of quantum vaiebat is constantly aris- 
ing where things have been furnished not under con- 
tract, but by mistake. Once money was paid an English 
admiral by mistake. He went on a long spree with it, 
and successfully defended a demand for its return, 
on the ground that it had not 1 4 enriched* ' him any. 
There are many good judges however, who doubt if 
that was good law. 

If an owner who had agreed to sell anything, wanted 
to back out on the ground that there was no contract 
because the buyer was a minor, probably the courts 
would not excuse him if the minor sued through a 
guardian for enforcement. The principle would seem 
to be in accordance with the maxim that 4 4 no man has 
a right to take advantage of his own wrong". The 
seller in the supposed case, being of age, is presumed 
to know what he has, and has not, a right to do. He 
has no right to contract with a minor (unless for a 
necessity, under his health and circumstances) and 



§213] Law of Personal Property Contracts. 189 



therefore cannot take advantage of his being a minor, 
to set aside the contract. 

But suppose for some reason which we need not 
take the trouble to invent, a minor wishes to set aside 
a contract, has he not been as wrong to go into it as 
the adult: so should he have any more right to set it 

aside? The law is pretty decided that he 
SStoSjwJjf.' " should. It is the special province of the 

law, so far as it can, to protect the weak. 
The minor is in special danger of being led by adults 
into unfair contracts, so he rightly has the power to 
set them aside. The adult, on the other hand, is left 
to take care of himself, and is all the better for the 
responsibility. True, as already said, the law cannot 
attempt to discriminate between strong men and weak 
ones, but it can tell the difference between people over 
twenty-one years old, and those under. 



CHAPTER XVI. 



LAW OF CONTRACTS FOR PERSONAL RELATIONS. 

. enc If A, being away from his stable, sells 

gcncy ' a horse to B, and on coming home is met 
by his groom, who says: "Here's a hundred dollars 
that I just got from C for that horse you told me to 
sell, and he has taken him away", whose horse he is 
depends upon whose horse he was when the groom 
sold him to C If A had sold him to B before the 
groom sold him to C, he was B's. A could not give C 
any title to him that A did not have himself. But 
if A's man had sold him to C before A sold him to B, 
A had no title to sell B. 

214 (a). Author- ^'s man COVL ^ gi ye B as good a title as 
ued acts bind A had, if A had made him his agent to do 

principal. &Q . { A nQt said tQ gub _ 

stantially: "Sell that horse when you can get $100 for 
him", but had only said substantially: "I think I'll sell 
that horse when I can get Sioo for him", he had not 
made the groom his agent to sell the horse, and no 
agent can do more than he is authorized to do, unless 
the principal has, carelessly or otherwise, given the 
third party good reason to believe that the agent had 
the necessary authority. 

Again, suppose A had given instructions to sell the 
horse for $100, and the groom had given C an option 
(203) on him for a month. A's instructions did not 
give the groom the right to tie the horse up for a month, 
so that A could not take a better price, unless the 
groom was sure of the sale at the end; or perhaps 

190 



§ 2i4 c ] °f Contracts for Personal Relations. 191 



for that long, even if he was sure, because the horse 
might get sick or die meanwhile. 

But if A had said: "Do anything you please with 
him that will put me to no expense, but don't bring 
me less than $100", that would probably have given 
the groom a right to give an option, if he honestly ex- 
pected that it would lead to a sale: yet it was rather 
risky. Most courts would probably hold such an 
option good, if the consideration for it were good. 
214 (t>h Agent If the consideration for the option on 
liable for exceed- the horse was held to be good, and the 

ing Me authority. wefe ^ becauge 

the agent had exceeded his authority, the remedy 
could only be through damages by suing the agent — 
if he had enough to pay with: a principal can be sued 
only for what he has authorized an agent to do, or 
that which through negligence he had permitted his 
agent to assume authority to do, after having placed 
the agent in a position in which he might deceive the 
public. 

214 Principal As already intimated, an agent can do 
bound aieo bu acta all that his principal has given a third 

third party has , ., x . , . . " - 

good reason to be- party good reason to believe the agent 
tieae authorized. has been aut horized to do: for instance, 
if A had said to C so lately that A could not be rea- 
sonably supposed to change his mind: "I always let 
my man buy and sell my horses as he thinks best: I'm 
so buried in my books that I don't attempt to know 
anything about the stable'" — if A said that, he would 
be estopped (190) from denying it to C, after C had 
acted on the faith of it. 

Nor is the principle of estoppel the only one or the 
main one, that forces a man to abide by the authorized 
acts of his agent. 

Now in the horse case, suppose A was not the real 
owner, but merely the agent for the owner, and the 
owner disapproved A's selling him, whether the court 
would enforce the sale, would depend, as already said, 
upon whether the owner had led the buyer to believe 
that A had the authority; or if not, upon whether A 



192 



The Protection of Rights. 



[§2I 4 C 



had exceeded his authority, or whether, merely, the 
owner had changed his mind after giving A authority. 
A principal is always bound by the act of his agent, 
unless the agent exceeds his authority. 
214 Agency There is also Agency by necessity. A 
through necessity. w jf e an( j children are a husband and 
father's agents to supply the family with necessities 
according to his means, and so can render him liable; 
or if in accident a bystander takes the place of a dis- 
abled agent, the principal is liable for consequences. 
Should a man running a launch become ill, and a pas- 
senger take the wheel, if he wrongly ran down another 
boat, the owner of the launch would be liable, tho he 
had not engaged him. It is an old maxim of the law 
that he who does an act through another, does it him- 
self.* 

214 (e). Agent can- ^ t ^ ie owner °f the horse had said: 
not make am, "Sell him for $100", and the agent had 

profit for himself. done ^ &nd gQt he have 

no right to keep the difference: an agent is simply his 
principal's self, as far as business between them is 
concerned. 

To leave horse-trading for a moment, suppose an 
agent were sent to buy a piece of land on which the 
principal was going to make an improvement that 
would greatly raise the value of land in the neighbor- 
hood, and the agent bought some neighboring land on 
speculation himself. He could not keep it if his prin- 
cipal wanted it at the price. An agent in a transac- 
tion simply represents his principal in everything con- 
nected with it. It would be the agent's duty to tell 
his principal about the neighboring land: so far as 
everything connected with a principal's business is con- 
cerned, an agent's mind should be simply his princi- 
pal's mind, and his pocket his principal's pocket. 

Should an agent receive bribes to buy from particular 
people, the law would give them to his principal, and 
in some cases would punish the agent. Cooks and coach- 

* Qui facit per altum, facit per sc. 



§ 2i4 g] Law of Contracts jot Personal Relations. 193 



men acting as agents for the purchase of supplies, often 
take commissions on them, and pay high prices, and 
waste much in order to profit by needless purchases. 
All this they are frequently tempted into by com- 
peting dealers. The act is criminal in both parties, 
and the dealers being generally the more intelligent, 
deserve double blame. Employers who would rather 
endure the loss than take the trouble to prevent it, 
nevertheless owe it to the community to ferret out 
and prosecute such cases. Occasional examples made 
of them would obliterate a great and growing abuse. 

If an agent known to habitually represent a prin- 
cipal, buys a thing at a higher price than the principal 
has authorized, the principal is bound, tho of course 
with right to recover from the agent. Hence on mis- 
trusting or discontinuing a purchasing agent, it is very 
important to give notice to people who have known 
him in that capacity. 

214 <f). ne aupe- ^ not seldom happens that agent and 
riorja generally principal are both responsible. We can 
/table. imagine many cases where the other party 

to the contract might in reason sue the agent, and 
then the agent sue the principal, or vice versa; but 
it is a maxim that "the law abhors litigation", and in 
most such cases, the judge would order the first plain- 
tiff to sue the last defendant direct. This fact and 
the fact that the principal is generally "good" for 
damages, while the agent generally is not, naturally 
make the custom as it is. "Let the superior answer"* 
is good sense and good law. But there is another prin- 
ciple of law working in the same direction: under the 
maxim already quoted — that whoever does a thing by 
means of another, does it himself, the agent is regarded 
somewhat as a mere involuntary instrument, and there- 
fore not responsible. 

A principal is responsible for his agent's 

2H(9h even for j • t -a • r 

wrong done in wrong-doing, if it occurs in course of any- 
oo^sb of routine thing t h at the principal has authorized 
his agent to do, but not in anything the 
* Respondeat superior. 



194 



The Protection of Rights. 



[§*i4g 



agent does outside of his authority. For instance, a 
servant was throwing snow from the roof of a house 
in New York. He had not given any notice to passers- 
by, and killed a man. The master had to pay damages 
to the man's family. Note in this case that it was not 
necessary that the master should specifically order the 
servant to throw off the snow. Agents such as ser- 
vants and employees generally, have certain regular 
and ordinary duties; whatever they do in direct con- 
nection with those duties, their employers are respon- 
sible for. That may be hard on a man who, through 
bad luck, gets hold of a careless or wicked servant, 
but it is the master's bad luck, and not the victim's. 
But servants are hardly a question of luck. The law 
does well to hold a man responsible for care in selecting 
his servants or any other agents. An employer of many 
men could do great harm in being careless whom he 
sets to shoveling snow from roofs, or driving horses 
through the streets, or running elevators or engines. 
214 (h). which At first it may appear that if the agent 
J fe™* g *Vr%*y Uf ' does wrong, it would be fairer to sue 
requires. him than to sue the principal. But it 

would not generally be fairer to the sufferer, because 
generally the agent is the man of inferior ability, and 
therefore of inferior wealth. But if he has any money, 
the sufferer may sue him if he prefers. People often 
employ brokers and commission merchants for the 
very purpose of keeping themselves in the background. 
In such a case, the other party to the deal must take 
his risks with the agent. The agent is personally liable 
when he does not disclose his principal. 

If an agent employs subagents, he is usually respon- 
sible for them — a contractor doing work for another 
man, is generally responsible for his workmen. 
214 (i). Both prin- Yet if one makes another his agent to 
uSb1eln d w a rlZ- commit a murder or robbery, the respon- 
d <>ing. sibility does not slip past the agent and 

rest entirely upon the principal. In all wrong-doing, 
agent and principal are both responsible, where the 
agent acts under instructions. 



§215] Law of Contracts for Personal Relations. 195 



214 <j). Classes of Anybody appointed by another to do 
agenu. anything for him, is his agent to do that 
thing; generally attorneys, commission-merchants, bro- 
kers, auctioneers, salesmen, clerks, domestic servants, 
and any employee — so far as concerns what one was em- 
ployed to do: anybody, in short, who does anything at 
the order or request of anybody else, is his agent, tho 
agents are generally employed to contract, while serv- 
ants seldom are. 

215 P rtnershi ^ partner is more than an agent for the 
. a ners p. Qt ^ eT partner or partners : in dealing with 

outsiders, each partner has all the powers of an owner. 
These powers are limited of course to the partnership 
business. A man may be partner in several concerns: 
of course his partner in only one, would not control 
anything in another. 

But in case of disagreement among the partners of 
any firm, a firm can limit a partner's authority by giving 
notice, and anybody having such notice would deal 
with a partner at his own risk. 

But when partners disagree, and a person dealing 
with them has had no notice, when one partner has 
spoken, the rest must abide by what he has said. If 
he runs them in debt, each one is liable to the full 
extent for everything any one partner may do in rela- 
tion to the partnership property. So inclusive is this, 
that if A owns say one tenth in a partnership property, 
and B owns the rest, and B is rich in other things 
while A has nothing else, A can run into debt for a 
lot of worthless things, and B will have to pay for 
them. This presupposes of course that the two appear 
before the world as partners, and the worthless things 
are sold to them in good faith for the partnership 
account. It is very foolish, then, for a rich man to 
take a poor cne into partnership, unless he knows 
him very well: for ordinarily a man's whole estate 
is at his partner's mercy. 

Yet a limit to the liability of any partner can be 
made by advertising the amount that he has put in, and 



196 



The Protection o] Rights. 



stating that the liability is limited to that amount. 
The method varies in the different states, however, 
and a lawyer should be consulted. 

To constitute a partnership, people must be asso- 
ciated in continuous business for the purpose of making 
money. An unincorporated club or a joining of forces 
for a specific job not taking a long time, does not con- 
stitute a partnership. 

When partnership is dissolved, the liability of each 
partner for the others' acts, is terminated by notice 
of dissolution, to people with whom the firm has regu- 
larly dealt, and by newspaper advertisement to others. 

216 Service * n sc ^ ent ^ c language, almost any act 

erv ce. fast one does for the satisfaction of another 
is called a service. Pleading a case or singing a song 
is in that sense a service. For that matter, the law 
calls all persons servants who are in the employment 
of others for salary ; the President himself is sometimes 
called the servant of the people. 

In a contract for any sort of service, from that of a 
bootblack up to that of the highest artist, for any 
period — say for a week — the employee is bound to give 
good service and good behavior for a week, and the 
employer is bound to give decent treatment and honest 
pay for a week. If either defaults, it releases the other, 
and the defaulter is of course liable for damages. Yet 
among employers and servants both, there is a good 
deal ot ignorance and stupidity about this matter. 

216 (a). Discharge There are no * a few employees of all 
for cause stops pay kinds who think they can be lazy and 

for rest of term. disa gre eab l ef and still get their pa y— even 

going to the point of asking pay for the full time 
agreed upon, when they have been deservedly dis- 
charged before it had elapsed. In such a case, it is 
always a good citizen's duty to fight even petty injus- 
tice, rather than yield because yielding is less trouble. 
Only in that way can the public idea of justice be 
kept high. 



§ 216 c] Law of Contracts for Personal Relations. 



197 



But of course in quarrels between em- 
wnhoJiic^8e% 9 r e ployers and employees, the employees are 
rfow»ofc 0r cauae ' ky no means always in the wrong: em- 
ployers sometimes maltreat servants, or 
discharge them when they really are not to blame. 
In such cases the employee's right is to get wages for 
the full time agreed upon, even if no service is rendered 
for the portion of it after the discharge. But it is the 
duty of an employee to try to get work, even if wrong- 
fully discharged, and any salary received for service 
during the contractual period, must be applied in reduc- 
tion of the claim on the employer. The same prin- 
ciples hold between mechanics and clerks and agents 
and their employers, as between domestic servants and 
their employers. 

According to the general principle already given, if 
the servants in a house, or mechanics in a factory, are 
paid by the week, and one of them is found to slouch 
or scamp his work, the employer is not bound to keep 
him the full time, nor can the delinquent claim wages 
for the full time under the contract. The contract 
means honest work for honest dollars: if he does not 
render the work, he is not entitled to the dollars. 

If the employer turns him off Wednesday for cause, 
the law does not suppose that he might have worked 
honestly Thursday, Friday and Saturday. The law 
always judges people by their records: even if a man 
with a good record commits a crime, the law is more 
merciful to him than to a man with a bad record. 
216 fo. Both ^ an employee's record is good, but an 

bound for the en- employer finds he does not need him as 
re erm. long as he contracted for, it is the em- 

ployer's loss: he should engage for only practicable 
terms. 

If the employee is offered higher wages to leave a fair 
employer before his term is out, he is bound to stay 
his term. In the absence of special agreement, the 
term is usually the period for which payment is made — 
day, week, month, year: the special customs of the 
trade may affect the question. If a servant leaves 



198 The Protection of Rights. [§ 216 c 

without just cause before the end of the term, he is 
not strictly entitled to any pay on account of that term, 
tho the judge would probably give him a quantum 
meruit (189), but if his departure had caused his em- 
ployer serious inconvenience and loss, the judge would 
probably deduct part or all of the quantum meruit to 
make the employer good, or might even award him 
damages. 

The case of the servant leaving, just cited, might be 
a very important one: for instance, if he were an expert 
engineer or electrician or life-insurance actuary, whose 
place it might not be easy to fill. 
217. Remedies for If contracts for service are broken in 
Broken Contracts, essential particulars — not merely in for- 
mal ones, the law will either issue an injunction against 
the employee leaving, if his staying were desired by 
the employer (not a very likely case, at least in the 
lower grades), or the law would give damages, or, if 
the case admits, combine both. 

If the contract is not for personal service, but, we 
will say, for manufacturing goods, or building a house, 
the court would probably order "specific performance", 
as well as give damages for delay: it tries to meet 
the wishes of the aggrieved person, as far as justice 
will permit. 

We have now gone through the principal kinds of con- 
tracts, which are Sale, Warranty, Surety, Insurance, 
Bailments, Agency, Partnership and Service. 



CHAPTER XVII. 



LAW OP SOME QUASI-CONTRACTUAL RELATIONS. 

Now we come to a set of relations including those of 
the various kinds of trustees who manage property for 
the benefit of others. These relations sometimes arise 
under contract, and sometimes by mere appointment 
and acceptance. We can, however, see something like 
a contract in the latter case: there would seem to be 
consideration on both sides — giving the position with 
its emoluments (if any) on one side, and the perform- 
ance of the duties, on the other. Accepting a position 
is certainly undertaking to perform its duties. Accord- 
ingly, for symmetry's sake, perhaps we may call these 
relations quasi -contractual ones, altho that term does 
not apply in strict legal usage: under it they are gen- 
erally called fiduciary. 

218. Trusteeship in A trustee of property is not merely a 
general. representative of another person or party, 

as an agent is : he really owns the property for a longer 
or shorter time, but owns it for another's benefit. 

The principal classes of trustees are directors of cor- 
porations (who are trustees for the stockholders); 
assignees of bankrupts; administrators of estates when 
there are no wills; executors of wills, guardians of 
minors, and trustees without special names, who may 
be appointed for hundreds of purposes. 

If a trustee does not pay over what is entrusted to 
him, or take reasonable care of it, he is liable to have 
his own property sold to make up any losses. He is 

i99 



200 



The Protection of Rights. 



[§219 



219 Safe uards a * so ^ a ^ e to prosecution for "Breach of 

aegu s. Trust", which is a crime punishable with 
imprisonment. This crime is perpetrated vastly 
oftener than inexperienced observers have any idea of, 
especially regarding the property of women and children ; 
but it is very often hushed up, because it is peculiarly 
apt to happen between friends and relatives — trustees 
naturally being selected among them. 

The best defence yet evolved against breach of trust, 
is making a "Trust Company" a trustee, instead of an 
individual ; tho probably it is best to associate with the 
company, an individual friend of the "cestui que trust", 
as the beneficiary is called. Then instead of one man 
secretly yielding to temptation, it would generally 
be necessary for all the officers to yield together, with 
the knowledge and connivance of each other. 

220. Assignees of An important class of trustees are the 
Bankrupts. assignees of bankrupt estates. When, 
through misfortune (or oftener through lack of economy 
or energy or some of the other qualities essential to 
ability), a man's debts exceed the value of his property, 
it is almost useless for him to go on in his own way, 
because he is apt only to make things worse. It is 
usual then to declare him bankrupt (bench-broken, from 
an ancient custom in the Italian exchanges of breaking 
the bench of a banker who had gotten into such a situ- 
ation), and for him, either voluntarily or through the 
action of a court, to assign his property to a trustee 
who will dispose of it and pay the creditors such por- 
tion of their claims as it will yield. After the settle- 
ment, such as it is, is made, the assignee gives an account 
of it to a court, who, unless there is evidence of fraud 
on the part of the bankrupt, discharges him from farther 
liability. 

220 (a). Justice At first sight, this may not seem fair to 
of discharging the creditors; but it is a great deal fairer 

ankrupts. t ^ an letting the bankrupt go on making 
worse ducks and drakes than before, and so insuring 



§221 a] Law of Some Quasi-Contractual Relations. 201 



that the creditors' shares would be smaller still. On 
the other hand, if the bankrupt's bad condition were 
temporary — the result of some special misfortune, in 
case he is relieved of so much of his debts as he is not 
at the moment in condition to pay, he can take a 
fresh start with lighter burdens; and if he really has 
ability, there is nothing in his bankruptcy to prevent 
his paying his deficit when he makes money enough 
to, as indeed happens in an occasional case. But 
if a man lacks ability, it is best that his creditors should 
take the property he holds, and he find the place for 
which Nature made him, under the guidance of some 
man who has ability. 

We now come to trustees for the estates of deceased 
persons. At the outset we must note a difference in 
the ways real estate and personal property are disposed 
of at the owner's death. 

221. Administrators. If n ° is le ,ft makin S J different di S - 

Devoiution of intes- position, the real estate, subject to dower 
tate estates. Qr courtesv rights (82 g), at once becomes 
the property of the heirs, while personal property is 
held in trust by somebody appointed by the court, 
called an administrator, for the payment of funeral 
expenses and debts, and then for the division of any 
balance that may remain, among the relatives or others 
entitled to it. 

This does not imply that a family must live off the 
real estate until all the debts are paid: there might be 
real estate in litigation that could not be used in years. 
In such cases, the court makes from the personal prop- 
erty, such allowances for the support of the survivors 
as the estate seems to justify, and even leaves some- 
thing to the discretion of the administrator. 
221 (a). Rights of Rights of inheritance, when there is no 
relatives 0; intes- will, vary in the different states; but gen- 
tat08 ' erally, rights of dower and courtesy being 

allowed for, the real estate at once, without any for- 
mality, vests equally in the heirs. "Heirs" is really a 
technical term, meaning the persons who take real estate 



202 



The Protection of Rights. 



[§ 221 a 



when there is no will. They are the nearest blood-rela- 
tives of the same degree — children or the descend- 
ants of deceased children if there are any ; if not, parents 
if there are any; if not, sisters and brothers or the 
descendants of deceased ones if there are any; and 
so on, out to remote degrees of relationship. The 
children of a deceased person who would take if living, 
divide equally the share that the parent would have 
had. Of personal estate, husband or wife usually 
takes a third, or a half where there are no living de- 
scendants; and the rest is divided like real estate. 
222. Executors. When there is a will, matters are settled 
w ,,s ' up by one or more persons usually ap- 

pointed in the will, and confirmed by the court, called 
executors. There is a very great advantage in this: a 
man who has accumulated and managed property is 
apt to be a much better judge of who would better 
manage it for his family, than a court who knows nothing 
about it, and is apt to appoint as administrators near 
relatives who may lack the necessary business qualities. 

Sometimes a testator forgets to name executors, or 
those he names may not survive him. In such cases, 
the court appoints administrators with the will attached. 

The usual essentials of a will good in law, are that it 
shall be in writing, state the testator's desires clearly, 
and be as simple as possible. If it is intended to give 
a wife property to take the place of her dower rights, 
it should clearly say that the property is given in 
place of dower (or to a husband, in place of 
courtesy); it should name all persons naturally apt 
to inherit, even any that it may intend to cut off, 
so that they will not be supposed to be over- 
looked; it should be dated, and state that the 
testator revokes all other wills previously made by 
him; and it should be signed in presence of two 
witnesses not otherwise named in it, who them- 
selves sign a statement written on it that it 
was signed in their presence, pronounced by the 
testator as his (or her) last will and testament, and 
that, at the testator's request, they have signed it 



§ 222 a] Law of Some Quasi-Contractual Relations. 203 



in his (or her) presence, and in the presence of each 
other. They should also append their addresses. 

If it is not said in the will that it revokes all pre- 
vious wills, and a previous one is found, the early one's 
provisions must be carried out so far as they can be 
without upsetting provisions of the new one. For in- 
stance, if the new will names bequests to A, B and C, 
and an old unrevoked will is found, leaving bequests to 
E, F and G, if there is money left after A, B and C are 
paid, E, F and G will be paid, or paid pro rata as the 
money holds out, and these payments would be at the 
expense of such persons as would otherwise have the 
money under the last will. 

If a will is known to have been made, but cannot be 
found, if it can be proved that the testator did not 
destroy it, and wished it enforced '(for instance, if it 
was accidentally destroyed after his death), and if any 
of its legal provisions can be satisfactorily proved 
(which they seldom can be) , they are carried out. Other- 
wise the estate is divided as if there had been no will. 

If after making a will, a man sells a piece of property 
named in it, the person to whom he has left it can get 
no equivalent: the will is to that extent of no effect: 
so people naming special pieces of property in wills, 
must be careful afterwards. A better way, unless there 
is reason to the contrary, would be to name only sums 
of money, or shares of the estate. 

In some states, marriage or the birth of a child, after 
making a will, sets aside the will, it being assumed that 
it would be the testator's wish that the new member 
of the family should be provided for, which of course, 
would be done by treating his estate as if he were 
intestate. 

Theoretically, a man can leave property to whom he 
pleases, tho if he passes over those who would naturally 
be nearest and dearest to him in favor of others, it 
would make it easier for those neglected to prove him 
of unsound mind, so that his will would be set aside. 
222 (a), who can- Under the English law, and still in some 
not make witia. states, not only are wills of persons of un- 



204 



The Protection of Rights. 



[§ 222 a 



sound mind set aside, but also those of boys under 
fourteen and girls under twelve. In most states, how- 
ever, the ages have been raised to eighteen and sixteen. 
Until lately, under the law of England, and perhaps 
still under that of some of the backward states, mar- 
ried women cannot make wills. 

222 <b>. Restric- There are also some other restrictions 
tions on alienation, regarding what the law will or will not see 
carried out in a will. The experience of ages has shown 
that it is against " the greatest good of the greatest num- 
ber "as the philosophers say, or against "public policy" 
as the lawyers say, that land or capital should be kept 
in hands that cannot or will not use it properly, and 
so made more difficult of attainment by people of 
ability who will get the most out of it, and manage it 
so as to afford the most employment and product for 
their fellow men; and it has also been realized that it 
is against public policy that the accumulation by com- 
pound interest of enormous properties should put so 
much power in any set of hands as to make them dan- 
gerous to the community.* For these reasons the law 
will not give efficacy to any disposition of property 
which will delay its passage into new hands for many 
generations. So it is very important in making a will 
leaving property in trust for the benefit of children or 
descendants more remote, not to run up against any 
of the laws affecting alienation. There are several of 
these, varying in different states, and much complicated 
by decisions under various circumstances : so it is wise 
to consult a lawyer whenever trying to tie up property 
for anybody's benefit, or for that matter in making any 
will whatever. And it may well be remarked in passing 
that it is very unwise to put off making a will until 
one's deathbed is reached. Not everybody dies in bed; 
and for those who do, the time is apt to be deferred, 
rather than hastened, by the consciousness that one's 

* This well-established principle of law is now attracting the 
attention of those who consider it necessary to curb the power 
of the trusts, and to limit the accumulation of excessive fortunes. 



§ 222 c] Law of Some Quasi-Contractual Relations. 205 



affairs are as well adjusted as one can make them. In 
England, it is the drift of the law to let property be 
tied up at least during any existing life. Once a trust 
for the benefit of all the testator's grandchildren was 
maintained until the death of the last of eight grand- 
children who were alive when the will took effect. But 
more grandchildren born after the will took effect, got 
no benefit from the trust after the last of the earlier 
grandchildren died. Yet of course the later ones par- 
ticipated in the division of the estate that the law 
then required, but the case would probably not have 
received the attention it has unless other persons were 
living who had to share with them to their disadvantage. 

But there is an American illustration in a direction 
nearly opposite. The American law tends to restrict 
alienation only during the longer life of one of two living 
persons who must be designated in the will. Hence 
when a testator tried to create a trust for the benefit 
of four living granddaughters, it was declared void 
because he had designated more than two, during the 
life of the surviving one of whom the trust should last. 
222(c). Deaf sea for Notwithstanding all this, property can 
lio^ftible'uaea ^ e tied up for educational or charitable 
c or a e uses. uges ag \ on g as one pi eases> an( j the benefit 

of such things as hospitals and schools can be restricted 
to particular kinds of people. Yet a testator could not 
endow an elegant domain with homes and schools whose 
use should be restricted to his descendants forever, 
because it would be a plain attempt to evade the law. 
Of course the determination of whether any such scheme 
is an attempt to evade the law, is one of the things 
that judges are for: they are all the time stopping at- 
tempts to evade the law. Such a case could hardly 
escape the attention of the courts, because as soon as 
the time should come for proving such a will, or later, 
when the legal time should come for dividing up the 
property, there would probably be people entitled to 
inherit, who would apply to the courts for their rights. 
It is not likely that all of a testator's family would have 
died out: there would be a distant relative somewhere. 



2o6 



The Protection of Rights. [§ 222 c 



If not, the property would escheat to the state any- 
how. 

When all bequests have been paid, if anything is left 
over, it is divided as the law would have divided the 
whole estate if there had been no will. 
223 Guardianshi ^ minor child does not at once become 
ua ans p. ^ e owner of his share of a parent's estate. 
He holds the legal title, but the management of it, in- 
cluding the signing of all papers relating to it, is gen- 
erally done by his guardian — a person approved by the 
court, often the surviving parent, tho the guardian is 
generally named in a will. 

After the testator's death, the will must be proved 
genuine before a court whose province it is to attend 
to the interests of widows, orphans and other bene- 
ficiaries from the estates of such persons. If there is 
no will disposing of an estate, application for admin- 
istrators must be made by the parties in interest. 

On first learning that courts appoint 
batt'Courts!* Pr °" administrators or executors , people are very 
apt to ask: Why should a court come 
bothering in the private affairs of a family when it 
loses its chief member or any member? To begin with, 
a will is often questioned, and somebody must pass on 
its validity. Then the estate of a deceased person is 
not merely an affair of his family. The richest man 
owes some debts — probably the richer he is, the larger 
they are. Moreover, as we have seen, a man of great 
ability is called upon to help manage the affairs of a 
great many people — as guardian, administrator, and in 
the various other forms of trusteeship. His relations 
to all these people, not to speak of those to his family, 
often give rise, after a man's death, to a great many 
questions, and civilization has never been evolved very 
far without its being found necessary to have special 
officers, and even special courts, to see that justice is 
done in all these connections. Nor is the multitude 
and complexity of these relations the only reason why 
courts should supervise the management of the estates 
of deceased persons. Those for whose benefit the 



§ 226] Law of Some Quasi-Contractual Relations. 207 



estates are settled — especially children when they 
grow up, might not be satisfied, and might make claims 
on a guardian, or on the executor of a will, or the ad- 
ministrator of an estate where there is no will. If such 
trustees act under the advice and supervision of a court, 
their acts cannot be successfully questioned. 

225. Trustees for Minor heirs are, of course, not the only 
defectives. persons whose property is cared for by 
somebody else. Generally a court appoints somebody 
to care for the property of lunatics, drunkards and 
spendthrifts who have families dependent on them. 

oo« r«..*...n„ And there are still reasons of an op- 

226. Court super- » , , \ , 

vision of Trustees posite nature why trustees generally should 
in genera. ^ wa ^ c hed over by the courts. Persons 

having the interests of others in charge are not neces- 
sarily all superior to ignorance and temptation. The 
courts supply them with the experience of ages, and 
tend to guard them against wrong-doing of all kinds. 

The judges tell them under what circumstances they 
may sell or mortgage real estate (unless unlimited power 
has been conferred in a will) and what sorts of invest- 
ments they may make ; and also require accounts of 
their proceedings. 

Yet all these methods are not any more efficacious 
than other human inventions are : hence the desirability, 
as before stated, of a will naming executors who can 
be trusted, or associating a trust company in the man- 
agement of the property. 

When the task of any of the trustees we have been 
describing is done, they can be made safe from future 
trouble by taking their accounts before the proper 
court. After the court has approved them, the trustees 
are free from all liability, unless later there is evidence 
of fraud. 



CHAPTER XVIII. 



PERSONAL PROPERTY. 

Schemes for Distributing it more Evenly. 

(I) Scamping, Forbidding Work, Destroying Product, 
Anarchism, Communism. 

Now we have some idea of the agencies by which 
property is evolved and distributed and protected, and 
we knew before we studied these agencies, that the dis- 
tribution is very unequal — that the mass of mankind get 
very little compared with a few favored ones, and are 
naturally much dissatisfied with what they get. But 
we have studied to very little purpose if we have not 
come to a realization that the inequality is more of 
Nature's making than of man's, and that roughly speak- 
ing, and with a wide but decreasing margin of excep- 
tion, the men loudest in objections generally get what 
they loudest claim — namely, get what each man pro- 
duces — that, still roughly speaking and with a wide 
margin for exceptions, those who get little, produce 
little; those who get much produce much; and that 
he who would get more, must produce more. 

But we also know that this is a slow and, to most 
men, virtually an impossible way; and that conse- 
quently the world is full of schemes for doing it in 
other ways. Some of these we will now examine. 
227. Poverty has First, however, let us realize that altho 
no causes. a great deal of speculation has been spent 

on the causes of poverty, there is no cause of poverty. 
Wealth only has causes; but ignorance, stupidity, lazi- 
ness and misfortune of course obstruct the causes of 

208 



§ 228] 



Personal Property. 



209 



wealth. In early times all people were poor, even to- 
day every child is Lorn with nothing, and of course he 
has nothing until he produces it himself, except as it is 
given him from the production of others. Unless he 
produces much, or somebody produces much for him, 
he never has much. Poverty lasts until the causes of 
wealth are effectively put in action. 

We have seen the conditions under which civilized 
man evolves his rights in personal property, to be 
initiative energy, discretion, frugality and the other 
virtues which we sum up as Ability. 

Of course there are other ways to wealth, such as 
luck and inheritance. But supposing them frequent 
enough for poor men generally to build any hopes on 
(which they are not), there is a characteristic of wealth 
got in those ways, which detracts very much from its 
usefulness. It is generally very fleeting: "Easy come, 
easy go", and "Twenty-five years from shirt-sleeves to 
shirt-sleeves",* are proverbs that have grown up from 
general experience. 

And yet the lazy and stupid, and even the perversely 
ingenious, are constantly nursing schemes for making 
everybody rich in defiance of the ways Nature has 
decreed, just as ignorant people are constantly trying 
to invent perpetual-motion machines, and to make 
water run up-hill by its own weight. We have already 
touched some of these schemes as affecting rights in 
real estate, but similar questions come up in connection 
with the products of labor, and we shall see in time 
that they come up in regard to money and taxation. 
Let us now examine the most prominent of the schemes 
for diffusing property without diffusing Ability to pro- 
duce it. 

The one probably in most general use is 
Ufa Scamping "making more work". Workmen often 
think that they can make more work by 

* Mr. Walker, of Worcester, whose investigation has already 
been alluded to ( 10 1, note), found that of the sons of the one 
hundred and seven manufacturers in his city in i860, only seven 
had property, or had died leaving property, up to '89. 



2IO 



The Protection of Rights. 



[§ 228 



scamping their work or neglecting it — that if a job is done 
so poorly as to need doing two or three times, there 
will be just so much more demand for labor; or that if a 
man does only half as much work in a day as he reason- 
ably might, two men will get a day's work out of a day * 

* From the New York Times, April 24, 1900 : 

"The Crime op Mrs. Derrick. — A headstrong and unman- 
ageable woman perpetrated a crime against the new social 
order in a Lowell carpet-mill the other day, by doing more work, 
and earning more money than the laws of the Carpet- Weavers' 
Union allow. The details of the shocking affair are set forth in 
a despatch to our neighbor the Sun: 

" 'Lowell, Mass., April 21. — Three hundred weavers employed 
by the Lowell Manufacturing Company, one of the concerns in 
the Bigelow Carpet Company, are on a strike because one of 
their number, Mrs. Jessie Derrick, persists in turning more 
work off her loom than is permitted by the regulations of the 
Carpet- Weavers' Union. The union has decided upon a maxi- 
mum product of two and one-half pieces, but Mrs. Derrick has 
her loom speeded up so high that she can turn off three pieces 
a day. On account of this the union sent word to the agent # 
of the company and asked that he compel her to reduce her 
production, but he refuses to stop the woman from earning 
all the money she is able to. . . .' 

" Mrs. Derrick explains that her loom was not 'speeded up'. 
Not at all. It was her energy and quickness and willingness to 
work that wrought the mischief. Back of it all very likely lay 
the necessity of earning more money to support those depending 
on her for food. . . . 

" Other carpet-weavers in the Bigelow works are as capable of 
getting off as much work as she, but as the union has decided 
it is unwise for them to do so, they all comply with the rule 
limiting the maximum product of each operative to two and a 
half pieces. 

" The dead level of triumphant inferiority cannot be main- 
tained and the comfort of the incapable and the lazy safeguarded 
unless the two-and-one-half -piece rule is enforced." 

From the Chicago correspondence of the New York Evening 
Post, Nov. '99: 

" A short time ago a Chicago man, in moving a dresser, broke 
off a gas-jet which projected from the wall in his bedroom. He 
plugged the broken pipe and took the fragment to a gas-fitting 
supply house, intending to buy the short piece of pipe and attach 
it himself. When he asked for it the salesman said: 

4 ' 4 Are you a journeyman gas-fitter ? ' 

" ' No', said the customer, 'I'm a shoe-dealer. What's that 
got to do with buying gas-pipe ? ' 



§ 228] 



Personal Property. 



211 



That certainly would promote the general good, if 
the world can be made richer by producing less wealth. 

But its effect even on the laborers themselves is 
disastrous. 

First: the scampers keep themselves out of jobs; 
Second: when they get jobs, if all scamp, tho each 
scamper gets paid for his false work, he has to pay for 
the false work of other scampers; Third: in the long 

" 'A whole lot', said the salesman; 'I can't sell you that sec- 
tion of pipe unless you have a working card from the gas-fitters' 
union.' 

" 'But I want this pipe for my own house, and I'm going to 
put it up myself, protested the householder. 

" 'That's the very trouble said the clerk. 'You'll have to go 
and hire a journeyman gas-fitter to put that pipe on, I can't 
sell it to you.' 

*' And the householder was forced to hire a gas-fitter, at $3.75 
a day, to come and do the work. 

" There was a quantity of old iron piping in the basement of a 
. building, which the contractor sold to a second-hand dealer. The 
man drove his wagon down to the place and started to load it 
himself with the old pipe. He was stopped by a member of 
the Steam-fitters' Union, who told him he must employ mem- 
bers of the union to handle that pipe or they would call out all 
the union men of the building. He had paid for the stuff, and so 
he had to hire two men at $4. 50 a day to load his wagons with 
the pipe. . . . 

"The Plumbers' Union has laid down the precise amount of 
effort which may be expended and branded one day'. There 
is a walking delegate in each ward whose duty it is to visit 
each job and check up the work, and any plumber found working 
longer than the rules allow is liable to a fine. 

" In one case the stonework on a building was all completed 
except the keystone of the arch over the main doorway. An 
opening had been left for it, and the workmen were arranging a 
block and tackle to hoist it into place, when a walking delegate 
appeared and demanded whether the men engaged in the 
work were members of the Hoisting Engineers' Union. He was 
told that they were not — they were members of the Bricklayers' 
Union and the Stonemasons Union and several other unions, 
but the hoisting engineers had been overlooked. At once he 
ordered the work on the building stopped until a hoisting engineer 
appeared to haul that forty-pound piece of stone up to its place, 
and all the work came to a standstill until the proper man was 
found. 

" A lather of ordinary speed can put up sixty bundles of laths 



212 



The Protection of Rights. 



[§ 228 



run, the scamper lessens the general demand for labor, 
and of course his own wages. 

228 (a). Keeps the * n illustration : a man in New York 
scamper out of wanted to put a trunk-lift from his cellar 
j0 *' to his garret. Some steam-heating fix- 

tures in the cellar were in the way. At that time, the 
steam-fitters had a very strong union, and it was said 
to be the policy to "make work " to a very extraordinary 
extent. Consequently steam-fitting in New York cost 
several times what it did in most other places, and the 
estimate for the alteration in question was so high 
that the owner concluded not to put in the lift: moral, 
"making work" cost the steam-fitters a job, and cost 
the lift-makers a job too. 

Another illustration: in the nineties, no first-class 
mason in New York would do a job of plastering in 
less than three coats, while excellent jobs were done 
elsewhere in two. At length came a quarrel between 

in a day. The rules of the union limit him to twenty-five. 
That makes the job last longer, and as the lather is paid by the 
day it keeps him at work more than twice as long. The plaster- 
ers who come after him can work no faster than the laths are" 
put up, therefore his job is extended to twice its length by this 
simple rule. 

"And now conditions have reached such a stage that the 
opposing forces are face to face and measuring each other's 
strength. The contractors and builders have warned the unions 
that January 1 will see a general shut-down unless rules, hours, 
and other conditions change. If that 'lockout' comes, no 
man can say where it will end." 

When it does " end", it will be interesting to figure the profits 
the laborers have directly made through this form of scamping, 
not to include what they themselves will have paid out for 
scamped gas- fit ting, steam-fitting, plumbing, hoisting and 
lathing. 

After the foregoing was in type, the results appeared. From 
the New York Evening Post's Chicago correspondence, Dec. 16, 
1900 : 

" The Building Trades Council ... is rapidly nearing its end. 
... It had more than 30,000 members. . . . Now it has about 
10,000, and [pending withdrawals] will reduce it to 7000. . . . 
The loss to the men in wages by permitting the unprincipled 
leaders ... to prevent them working has been in the vicinity of 
$2,500,000." 



§ 228 C] 



Personal Property. 



masters and men, and at least one of the masters told 
why he had declined to do two-coat work: the trade- 
union would not let its men work on jobs of less than 
three — one-third of most plastering jobs was pure waste, 
including those on the buildings for which the plasterers 
themselves were paying rent ; and moreover many jobs 
must have been lost in all the building trades, as was 
just shown in the steam-fitting and dumb-waiter trades. 
228 (b). He gets But wnen tne scamper has to pay other 
omy one profit but scampers, other scampers have to pay 
pays many. him: so it may appear as broad as it is 
long. But he gets paid for his own work at first hand, 
while most work that he has to pay for, must pass 
through many hands before it reaches him, and he 
must pay toll to them all, and this toll is based on the 
scamped cost. Manufactured articles cost the consumer 
many times what the manufacturer gets for them. 
Hence, if the hands through which the article passes, 
scamp their work, the consumer has to pay not only 
for the scamped work of the first producer (as he gets 
paid for his own), but also for the toll of every set of 
hands through which it passes before reaching him. 

Scamping lessens not only the demand for particular 
jobs, but also for labor in general. Work only half 
done, or done at half speed, costs twice as much as 
228 (c). Cannot ^ properly done — in fact more than twice 
'Za^e? unless 900 * as muc ^« because n°t only is half the labor 
ear 9 ne'd Un "* wasted, but generally some of the mate- 
piecework. rfaL Therefore, not only is the public un- 
able to pay for as much of it, but it cannot, in the long 
run, enable an employer to pay high wages. And if 
laborers return less than a paying product for their 
wages, the capital employing them must in time be 
used up, the employer's business diminished or destroyed, 
and the demand for labor be just that much less. 

In order to make paying by the piece a good remedy 
against men spreading their work over too long a time, 
one would have to invent a remedy against scamping 
the pieces in order to get more pay in a given time. 
As a matter of fact, the highest order of work is done 



214 



The Protection of Rights. 



[§ 228C 



"by time", and the lowest order "by the piece". A 
house done by "days' work" will generally bring more 
than one done by contract; and the better orders of 
mechanics, the world over, work by the day. 

Putting the thing in the broadest way, if all men 
only pretended to work, the result would of course be 
that nothing would be produced, and no man would 
have anything. 

229. Pretending The philosophers who believe in ' ' making 
and forbidding labor. WO rk " by scamping it, have not stopped 
at scamping. Thornton * gives a case where they tried 
mere pretending. A lot of stone-cutting had been done 
contrary to trade-union rules, and the union made the 
bosses pay men for standing idle over it with their tools, 
as long as it had taken to cut it. Thornton wrote forty 
years ago. In our progressive age, the papers are full 
of similar instances. 

The schemes to rob somebody — even other laborers, 
for the benefit of labor, include the seizing of work that 
naturally belongs to somebody else, and making the 
community pay the waste of the unnatural arrange- 
ment. Of this class are laws requiring stone-cutting 
to be done in cities where the stone is used, and at 
city prices, instead of at the quarries at country prices. 
Such a law regarding some public buildings in New 
York City, was pronounced unconstitutional in 1901, 
at an important saving to the city. 

The Supreme Court of Indiana, in a decision that a law 
was unconstitutional which obliged counties, cities and 
towns to pay at least 20 cents an hour for unskilled 
labor, held that cities, counties and towns have as much 
right as anybody else to contract for labor at the 
lowest market price. The proponents of the law hoped 
to establish a rate for labor generally : as if the matter 
could be lifted away from the law of demand and 
supply, otherwise than by disguised "charity". 

Even more absurd than the foregoing proceedings, is 
the securing of business to the nation at the expense 
of the nation. Such a proceeding was the regulation 
* On Labor. 



§ 229] Personal Property. 



that all material to be used in making the Panama 
Canal^ should be bought in the United States, and 
when possible be transported over railroads in the 
United States — both steps regardless of whether the 
goods or the transportation would cost the people of 
the United States more in the United States than else- 
where. The first of these absurd provisions was revoked, 
and restored in answer to the clamor of the protection- 
ists. At the time of this writing the second has been 
revoked, and there has not yet been time to restore it. 

Protective tariffs, we shall see later, tend to become 
of the same class. 

Of course, in the long run, such wastes must be dis- 
tributed over the community, and if they were the rule, 
the wasting laborers would have had to pay back for 
them, all that they got for their own waste. No rule is 
good for anybody unless it is good for everybody. But 
that school of philosophers has not even stopped at 
scamping* and pretending work: they go so far as to 
forbid it part of the time, as in the celebrated case of 
Mrs. Derrick (228, note). 

This matter is important enough to justify adding 
one more extreme illustration. Early in 1906 the 
following resolution was introduced at the United 
Mine Workers' convention in Indianapolis, and referred 
to a committee: 

RESOLUTION No. 107. 

Whereas, The practice of many of our members, working 
tinder favorable conditions in various parts of this country, of 
making six and seven dollars per shift is detrimental to the 
best interests of our organization as a whole; and, 

Whereas, This has a tendency to make it harder for us to 
obtain an advance in wages at our convention; and, 

Whereas, The average miner is unable to make $3.50 per 
shift; therefore, be it 

Resolved, That this convention place a restriction of $3.50 
per shift, clear of all mine expenses, on all miners working at 
the face. 

Presented by Local Union No. 99, Belleville, 111. 

A. L. Wright, 
T. J. Hitchings, 

Scale Committee. Delegates. 



2l6 



The Protection of Rights. 



[§229 



The Times, in commenting on this resolution, quotes 
Archbishop Keane: 

4 ' The man who slights his work and gives his employer less 
than he agrees to g^ve is a thief, and any labor union that 
upholds him in this slighting of work is a school of thievery." 

The willingness of a trade-union committee to receive 
and refer such a resolution as that, demonstrates the 
body to be under the dominion of a degree of short- 
sightedness that it must take generations to cure; to 
be far below the control of reason; and in exigencies, to 
be susceptible to no other control than the unflinching 
power of the state. To temporize by anything short 
of that, is simply cruel. 

If reports are to be believed, the Australasian cases 
of the early nineties, surpass even these. There labor 
was scarce and food cheap, and a man could make 
enough to live on by working half the day. The in- 
capables would not let the capables do more than 
half a day's work. One must either soldier all day or 
go home when he had done as much as a slouch usually 
does in a day. Capable men began leaving the colony 
on account of it. But the demonstration of the 
absurdity was shown when the policy had stopped 
some industries and depopulated some villages, and 
some of the leaders and "walking delegates" were in 
jail for conspiracy. 

But since these conditions were stated, they must 
have cured themselves: for nothing is said regarding 
them by the most recent writers. In fact, there is 
some reason to believe that the testimony on which 
they were based (tho it appeared in a high quarter — 
the correspondence of TJie Nation, unless I am mis- 
taken — or I should not have accepted it) is exaggerated, 
and that the conditions were partly due to industrial 
depression and financial stringency. Dr. Clark * goes 
so far as to say that while such statements may apply 
to particular localities and occasions in Australasia, 

* The Labor Movement in Australasia, by Victor S. Clark, 1906. 



Personal Property. 



2JJ 



"Ca' canny" and restriction of output are not remark- 
ably greater in Australasia than in Great Britain and 
some parts of America. Yet I let the original state- 
ments stand, with these qualifications, as an illustra- 
tion to the inexperienced reader of the difficulty of 
getting correct information on subjects where there 
is so much controversy. We shall see plenty more of 
such illustrations. 

230 " Shutting After all, it may be asked: where is 
down" a different the difference between laborers restricting 
ctse * work, and manufacturers restricting pro- 

duct? The manufacturer generally restricts volun- 
tarily, while the laborer is often forced to it — a direct 
interference with the Right to Work ; if several manu- 
facturers shut down, they all share the loss: if the in- 
competent limit the labors of the competent, the first 
gain at the others' loss. For the manufacturer, the 
public decides the question by refusing the goods; for 
the laborer, the question is decided irrespective of the 
public needs — the public may be suffering for the labor, 
but must go unsatisfied in order to enable the incom- 
petent to get higher wages. The manufacturer's slow- 
ing up (in legitimate cases) is to prevent waste : restrict- 
ing labor regardless of cases, in most cases is waste. 

Even scamping, pretending, and choking-off labor 
have not been enough for the philosophers : they have 
often gone to destroying. The papers are full of in- 

231. Destruction st ^ nC l eS ' , As . three } n ™2 7 ' th ? St ° ne " 
as an aid to polishers union made all the workmen m 

Production. the Hotel g avQy Jn New Yor k Stop work 

until the polish was rubbed off some marble mantels 
that had been polished near the quarries instead of 
by the New York union. In 1906 and for some years 
earlier, in most American printing offices, the men 
who set advertisements, would not use electrotype 
plates sent by advertisers, before they had set up a 
copy and destroyed their work. At a meeting of 
glass-blowers' unions in Terre Haute in 1905, their 
national officers were instructed to "get out a circular 
to be sent to all labor bodies asking them to get their 



2l8 



The Protection of Rights. 



[§231 



families and their friends to break all bottles before 
throwing them away." Those bottles were the prop- 
erty of the brewers, bore their owners' names blown in 
the glass, were subject to reclamation wherever found, 
and their contents had been sold on the understanding 
that the bottles should be returned. The resolution of 
the glass-blowers was a deliberate invitation to destroy 
other people's property in order to make work for the 
glass-blowers. 

People often falsely reason about a good many other 
things as they do about scamped work. In advocating 
not only scamped work, but some kinds 
rfminy ZcSSiyS of taxes (464) and cheap money (362) 
no&fn<? ieth,ng ° Ut anc * a ^ ot ^ er schemes for enabling a man 
" to get something for nothing, people forget 

that schemes to get something for nothing are also 
schemes to make somebody (and themselves as often 
as anybody) pay something for nothing. This is in- 
evitably the case of all wages artificially made higher 
than the natural equation between supply and demand 
(148 d). 

233 People irener- That ^ act 1S so often lost sight of because 

all v' consider only people generally think that high wages 
Income, not outgo. cover the whole ques tion of prosperity. 

Men of average mind seem able to think of themselves 
only as producers, not as consumers. They do not 
seem able to reflect that they have to pay out money 
as well as to get it in, and that if other people's wages 
are higher than the value of the things produced, they 
themselves have to pay out something for nothing when 
they pay those wages, and have also to pay middle- 
men's profits besides, while they themselves only receive 
something for nothing, without any middlemen's profits. 

In point of honesty, scamped work is exactly on a 
level with false weight or scant measure or an irre- 
deemable light dollar. It is a scheme to make a man 
pay for a day's work without furnishing it to him. 

Now let us look into some of the other schemes than 
scamping work, which have been regarded as superior to 



§ 234] Personal Property. 



219 



Nature's scheme for enabling men to get rich. At the 
bottom of them all, more or less disguised, is (as we saw 
regarding real estate [65-740]) the idea of govern- 
ment withdrawing its protection from property rights, 
so as to give those who have been too stupid or lazy 
or shiftless to accumulate any property of their own, a 
chance at that of other people. 

MM . The most extreme proposition of this 

234. Anarchism. , . , . , , v , v 1f 

kind is to do away with government itself, 

so that a man who has no property of his own can 

help himself to the property of other people. 

How long property would be produced under such 
conditions, the advocates of them do not say. There 
are some who want to do away with government, who 
still want property rights respected, but they do not 
tell us how they are going to get them respected : they 
want everybody to respect them voluntarily, and to be 
models of virtue all around — voluntarily. They say that 
it is a disgrace to a man to have to be compelled; and 
so*it is, but all the same, a good many will not behave 
themselves unless threatened with that disgrace. 

The form of insanity that wants these self-contradic- 
tory things — often a murderous insanity, often only the 
gentle mooning of certain poets, novelists and aesthetes 
who make themselves ridiculous in attempting the 
sterner sort of intellectual work — is attributable to 
the same source as most other forms of insanity — the 
abuse of a good thing. Government is a good thing, 
but it is often overdone. Those who have been unjustly 
oppressed by it often become incapable of seeing any- 
thing but evil in it, or in authority of any kind. 

It need hardly be added that those who are afflicted 
in this way are called anarchists. 

As they seem to be getting more troublesome, there 
is growing interest in ways of suppressing them. Rea- 
soning of course can produce no effect. Violent repres- 
sion seems to succeed no better, but a perfectly logical 
way has been suggested which may be worth trying: 
if a man wants to get rid of government, rid him of it, 
withdraw government protection from his person and 



220 



The Protection of Rights. 



[§234 



property, if he has any (which is not likely), and give 
him a chance to work his theories out in practice.* 
Tho government would not protect him, it could con- 
sistently restrain him, because in withdrawing its de- 
fence from him, it would not give up anybody's right 
of self-defence; and should the anarchist attack per- 
son or property, the victim would have a right to all 
the defence he could muster, including that for which 
he, unlike the aggressor, would not have abandoned his 
right to appeal to government. There is not enough 
argument for Anarchy, to admit of its finding a place 
in a sane mind, so we need not discuss it any farther. 

Another class of dreamers are willing to retain govern- 
ment, but want to do away with property rights. 
This class includes communists and socialists. 

Anarchists, communists and socialists claim that 
poverty is due to existing social arrangements rather 
than to the incapacity of many people, and the claim 
is true so far as bad social arrangements impede the 
operation of the causes of wealth. To upset the social 
arrangements as they propose, would be very well if 
234 (a). Badness of ^ Vld ^ na d ever proved any other arrange- 
P n7tlriuegw^°nl a ss ments better. But nothing is more difii- 
0} proposed "*** cult than to tell in advance how a social 
changes. arrangement is going to work. Those we 

have are the best we have tried, and it has taken a 
good many thousand years to get them even as good 
as they are now. They have improved so slowly, be- 
cause human nature improves slowly, and all social 
machinery has to be worked by human nature. 
noe . , The communists propose to substitute 

235. Communism, r , 1 . j r , • 1 , 

for the present order of property rights, 
having government make an even division all around, 

* The author, while believing this remedy original with him- 
self, of course supposed it probably original with a good many 
others. He first proposed: it in The Forum soon after the 
Carnot assassination, and on repeating it in The Review of 
Reviews soon after the McKinley assassination, he received a 
copy of a similar proposal that had been made by Judge Arn- 
quist of Wisconsin. 



Personal Property. 



221 



so that those who have saved nothing can have a share 
of what other people have saved. 

235 (a). $1,200 At a superficial glance, it seems as if 
apiece. a sc heme, if it could succeed now, 

would add vastly to human happiness. But it could 
not unless it produced more things : for we would have 
only a little more than twelve hundred dollars apiece: 
that being the average wealth in the United States in 
1900. To divide it evenly would not increase the hap- 
piness of those who have less, as much as it would 
diminish the happiness of those who have more. 

235 (b). sudden ^nd even ^ a division were to give 
wea/th'a doubtful sudden wealth, sudden wealth is not apt 
Musing. ^ Q ^ use( j we \\ certainly was not at 

the British coal-mines when a sudden rise in the price 
of coal gave the colliers a sudden rise in wages, and 
many of them spent the money in feeding their dogs 
on tenderloin steak, and smoking pipes with two bowls 
and one mouthpiece. 

True, the rich do not always use their money well, 
any more than the poor suddenly getting it, always 
use it badly. It is only a matter of probabilities either 
way: there is no universal rule with so complex a 
machine as human nature. It is simply the general 
fact that a man who gradually makes his money, is 
almost certain to use it better than a man who gets 
it suddenly; and it ought to be superfluous to point 
out why. 

Yet it would undoubtedly be well for people to 
have more, just as fast as they can make it: for that 
will be no faster than they are apt to use it well — 
and there is hope, as we have said more than once 
and shall give facts for later, that the ability to pro- 
duce it * and to use it, are fast being evolved together. 

* The wealth in the United States, is reported by the Census 
to have increased as follows. Wc shall find evidence later 
(Chapter XXIII) that the poor have received a larger proportion 
of it than the rich. In 1850, it was $308 per head; in i860, 
$514 ; in 1870, $780; in 1880,1850 ; in 1890, $1039; and in 1900, 
$1236. 



222 



The Protection of Rights, 



[§ 235 b 



But must each man himself produce unaided all he 
can have? Not by any means: inventors and or- 
ganizers are constantly enabling other people to pro- 
duce more. Consequently a laborer in a civilized 
nation has more than a king in a barbarous one ; but 
men seldom appreciate what they have, when others 
have more. 

Not only would communism fail to 
i^aumTwhu^ 1 ^^ everybody rich, even for a moment, 
but what wealth (?) it did give the very 
poorest, would all soon be either frittered away, or 
back again in the hands of Ability. As said before, the 
machinery has to be worked by human nature : at the 
outset, communism would make the lazy and shiftless 
profit at the expense of the energetic and saving; while 
after the outset, the shiftless would, just as now, soon 
waste what they had, not only in extravagance but in 
foolish schemes, and want a new division; and there 
would then be less to divide: the shiftless would have 
235 (d). and then already used up their share ; and com- 
there would be munism would have taken away from 
less than now. Ability all temptation to produce more 
than it could keep — that is to say, more than the 
average; and would take from frugality all temptation 
to save more than the average. 

235 ( w ) ' Uh M % ning " To carry out any scheme of communism, 
nboeHy. ° government would of course have either to 
rob the present means of production — factories, mines, 
etc. — from those who have produced and saved, or to 
buy them under eminent domain (78). 

As to eminent domain, of course the communists 
differ among themselves, as people advocating ideas 
that do not hold together, inevitably must; some 
advocate eminent domain, while some go so far as to 
say that all property is robbery — that people of ability 
and frugality have stolen from those who lack them, 
and that the community, in taking all the land and 
mines and factories and railroads without pay, would 
only take possession of its own. 

But even government's exercising eminent domain 



§235/1 



Personal Property. 



223 



over everything, and paying for it, would leave things 
just as they are. Everybody would get paid for what 
he has, and be taxed all he has, to pay it. 

A practical difficulty not yet stated, is 
oflfeaith Cannot 6? how to divide up a ten-thousand-dollar 
MwdertXed- house » or building-lot, or diamond or 
picture or statue, so as to give each person 
his twelve hundred dollars. If an attempt were made 
to give each a share in the diamond, for instance, it 
is hard to tell what ten of them could do with it. They 
probably could not hire it out to some vain woman 
each night: for, as nobody would be worth more than 
$1,200, no woman could pretend the diamond to be 
hers. As to the picture and statue, perhaps they 
could be exhibited, if enough people worth only $1,200 
apiece would pay to see them. But as to the house 
and building-lot, nobody could afford to live in the house 
or even to make it over into a tenement; and nobody 
could afford to build on the lot, unless under a syndicate 
arrangement. People who object to corporations are 
generally the very ones who would make it necessary 
for everything worth over $1,200, to be run by a cor- 
poration. 

There appears, then, to be no escaping the general 
conclusion that civilization rests largely on things that 
cost more than a thousand dollars apiece, and which 
cannot be divided, or even used to any advantage when 
held in shares; and that these things are the prizes 
which Nature holds out to men of great ability, to 
stimulate them to do all they can to invent and organize 
and regulate, so as to increase and cheapen things for 
the public good. Consequently, if you want to intro- 
duce Communism, you must begin by wiping civiliza- 
tion out. In short, Nature did not make this for a com- 
munistic world, but as one where wealth is the first 
condition of effective industry and the highest art, as 
well as the legitimate stimulus to invention, energy and 
capacity, and their legitimate reward. 

But that is, of course, a hard conclusion for the men 
lacking in invention, energy and capacity; and among 



224 



The Protection of Rights. 



[§ 235/ 



the many ways proposed for making them as well off 
as anybody, there are many which do not involve the 
impossibilities of Communism, altho they all have im- 
possibilities of their own. 



CHAPTER XIX. 



PERSONAL PROPERTY (CONTINUED). 

Schemes for Distributing it more Evenly {Continued). 

(II) Socialism. 

236 Socialism Chief among the schemes for giving 
oc a sm. j az y incapable the rewards of the 

industrious and capable, without attempting to divide 
everything, is that of merely putting all industries 
under the control of government, and dividing up 
product equally, and thus giving the poor an equal 
share in the profits. This is Socialism. 

The idea at least does away with the objection to 
dividing up or holding-in-common things which would 
be useless if divided up or held in common, and it at 
least glozes over the objection to putting the capital 
of the frugal directly into the hands of the shiftless: 
it wants merely the product given to them. It pro- 
poses, instead, to put the capital in the hands of the 
politicians, and have them give the shiftless an even 
share of the product — so far as the politicians make 
any — and do not keep it for themselves. That would 
at least divide up among the poor the profits now 
wasted by the rich, if the politicians were honest, and 
if the profits were to be produced. But as profits 
depend on Ability, and Ability needs them to stimu- 
late it, if you take them away from Ability, to divide 
up among those who lack Ability, it is pretty hard to 
see who is going to produce them. But at least every - 

225 



226 



The Protection of Rights. 



[§ 236 a 



body would get wages : there would be no unemployed. 

But nobody would get as much wages as 
9ouu a Jot 1 rS^ a now - As soon as Ability flags, demand 

for the labor for which Ability finds work, 
must flag, and wages must fall; invention must flag; 
production must flag, and the world must grow poorer. 

If government is to keep the demand for labor con- 
stant, the question is: who is to pay it from decreased 
production ? 

Ability might be stimulated to increase production 
by giving it high office in superintending government 
00c /#o w# industries, but to only a limited extent in 

236 ( oh Impractl- * . J 

oabiuty of pouti- any condition can we foresee, and for two 
em management g QO( j reasons> We now seldom pay govern- 
ment officers salaries that honest men, unless already 
well off, can afford to accept ; and as long as the base 
and ignorant are permitted to vote, and so often elect 
the base and ignorant to office, the best men could not be 
put in office as often as necessary, even if we were 
wise enough to pay them properly. So far, even those 
who can afford it, do not always take office when it 
is offered them, because of the humiliating obligations 
to the bosses that office sometimes imposes. The great 
difficulty even now is to get government officers who 
can and will do even the simplest things honestly: it 
is one of our great misfortunes that the men capable 
of guiding industry cannot often enough be got into 
public office of any kind. 

If, then, we had to depend for the good conduct of all 
our industries, on the combinations of circumstances 
where good men can get office and will take it, those com- 
236 (o Losses to binations so seldom occur, that, altho 
education, charity there are many good and patriotic men in 
and liberty. office, too often, instead of having the best 
brains competing with each other, as now, to supply 
our wants cheaply and in great variety, we should have 
to put up with what men capable only in politics, might 
provide. 

There is nothing in the socialist argument that because 
government already secures (if it does) fairly compe- 



§ 236 e] 



Personal Property. 



227 



tent managers for a few natural monopolies, it can secure 
them for productive industries, because monopolies 
yield results with much poorer management. 

The same is true of the argument from government's 
securing more or less competent managers of education, 
including the museums, and gardens of botany and 
zoology. In fact, the managers have been very seldom 
secured by any pure democracy — especially by ours, 
which has no aristocratic traditions. Our managers for 
such institutions are most all secured by close private 
corporations, and no such managers aim at cheap pro- 
duction, or even great financial results for themselves: 
they do their work mainly from love of it and for per- 
sonal development. 

236 (d). Forcing One of the schemes of socialism is to 
Abmty. force ability to guide labor, just as it is 

to force the laborers to work. But while a man can be 
forced to work in some sort of fashion with his body, 
there is no forcing him to do his best with his mind. 
He can only be tempted. 

4 4 Well, then", some socialists ask, 4 4 why not pay 
men of ability large incomes to serve the public ?" But 
that they get large incomes now, is what most of the 
socialists complain of. Yet now the men of ability are 
not sure of the incomes; if they were sure of their 
incomes as salaries, they would no longer have a stimulus 
to do their best. Yet to give them, instead of salaries, 
large, but necessarily uncertain, shares of production, 
would be to give them just what they are getting now, 
and just what the socialists want to take away from 
them. Should real socialism come in then, it can only 
come in by reducing the production of Ability. 
236 re;, neargu- * n answer to this, it may be urged that 
mem from expert- government has already been building 
ence ' nouses for the poor, supplying them with 

water and light, and making boots and clothes for armies 
at a saving; that a great many people sadly lack these 
good things and most others ; and that all the things 
made by private enterprise are often made at wages that 



228 



The Protection of Rights. 



[§ 236 e 



afford but little comfort. But what has been done in 
housebuilding and gas and even water, has not yet been 
shown to have been successfully done. We must not 
forget that agitation has already been strong in England 
— the very headquarters of 4 'municipal trading to 
drive government back toward its old functions of pro- 
tecting rights. 

When things have been supplied by 
2 undirtahen n Jhtn government for the army and navy, and 

l°JSn r cTAomer! U (t^o * n a ^ ess degree) * n tne case of gas 
and electric light, there was a certainty of 
the customer. The government stood ready to take 
the clothes for the army and the light for the streets; 
and the producer made army and navy supplies only 
to the government's order. There was no call for 
some of the rarest and most difficult powers of Ability 
— finding custom, avoiding bad debts, and anticipat- 
ing just what and just how much the market is going 
to require. True, if nobody but the government 
produced anything for the people, government would 
be sure of its customers. But no more customers 
would have the money to pay then than now, and those 
having it might like a choice of shops, and even of articles. 
They might not like to dress in Tammany style. Be- 
sides, we do not all dress in uniform, and it is only in 
uniform that government has yet succeeded as a tailor. 
236 (g). Private The government could of course have a 
inttiathe essential great many shops and styles, but if they 
to variety. we re all under the management of Tam- 
many Hall, they would be apt to be the sort of shops 
that prudent people avoid; and altho the government 
officers would not nominally be conducting the shops 
for their own profit, and tho some really might not, we 
know from experience that too many would. 

Government could still leave the private shops open, 
but only if it courted failure. Managers chosen by 
Nature to control political pulls, could never compete 
with those chosen by Nature to manage industry. 
There is no argument that they could, in the fact that 
government railways and tramways are often operated 



§ 236 ^] Personal Property. 



229 



side by side with private ones: for all have monopolies 
of their own routes. To succeed in competitive business, 
236 General government would have to take away the 
gouernment pro- citizen's power to purchase anywhere he 

duction attacks . , K , .F . J . . , 

Property, Contract pleased, just as the extreme municipal 
and charity. traders are beginning to do in England now. 
This would not only deprive him of the benefits of Com- 
petition, but of two other institutions that men have been 
laboring upon through all civilization, and upon which, 
in fact, all civilization rests: I mean Private Property 
and Contract. With them would go production itself, 
all education of a higher grade than government pro- 
vides, and the very possibility of charity. 

The scheme would upset the institution of Private 
Property, because private property is simply one of the 
consequences of ability. Other things even, a man will 
have as much of one as of the other; tho of course 
other things are not always even, because an able man 
may deliberately devote his abilities to something that 
he knows will not pay much, and sometimes "accidents " 
come in. Still, any system that denies ability free 
swing, at once attacks the right to create property. 

The system would attack Contract, because if the 
state is the only employer of Capital, Ability and Labor, 
of course any one of them has to accept what employ- 
ment the state gives, on the state's own terms. No one 
of them has any more opportunity to contract, on terms 
satisfactory to itself, than the veriest slave born to re- 
main in his status. 

The scheme attacks Charity, those who advocate it 
would say, by doing away with all needs of charity; 
but those who oppose it say that there would be more 
need of charity than now, because there would be less 
production ; and there would be no surplus of wealth in 
anybody's hands to be willingly spared for charities and 
the higher education. The idea that people with the 
moderate incomes that all would then have, would con- 
sent to be taxed for such things, is of course advanced, 
but is too absurd to be worth discussing. 



230 



The Protection of Rights. 



[§ 236 i 



236 Oh Futility of ^ government paid in bonds for the 
attempting it by present means of production (there is not 

eminent domain. money enough to pay)| bonds must beaf 

interest, and even if government management should 
produce the interest (which it probably would not), 
where would be the gain in government simply working 
the industries, and paying away all the production above 
wages (if any), in the form of interest on the bonds, 
to the same people who now work out the interest 
for themselves ? Of course people generally would then 
236 (J). Effect on get all that the industries might produce 
laborers. over an( j above the interest on the bonds, 

but after wages and interest were paid (assuming that 
they would be paid), the surplus would not.be enough 
to be worth considering. The wealth that the socialists 
are after could not reach them in that way any more 
than it does now: for the simple reason that no more 
would be produced than now (if as much), and, as the 
census reports of present industries show, even if pro- 
duction were kept up to the present standard, an even 
division would not yield an average of much more than 
two dollars a day for each wage-earner, even putting the 
managers and their shares in with the rest. 

But advocates of the scheme say there would be 
more, because they think that under socialism, most 
men, having so much more interest in the production, 
would work that much the harder. But there seem 

to be a good many men who, if they were 
M 6 i£i'ne A 8l remtum sure °f sharing the product, as in the 

Paris public shops, and under the English 
poor law (34), would not work at all. Unless a boss 
has the power of discharge, it is hard to see who is 
effectively to tell the workman what to do to make 
his work count. 

In Paris the government officers did not have the 
power of discharge, but if they have, what becomes of 
the socialism? Men could not be forced to work pro- 
ductively, and even if that were possible, it would be 
only by bringing the free citizen back under the slave's 
lash. 



§ 236 m] Personal Property. 



231 



236 ui would de- Moreover, government would have to 
stroy freedom. te n people how and when they should 
work — a man would no longer be able to choose where 
he should work and what he should work at, and what 
he should take for his work, nor where he should buy 
and of what producer he should buy: for there would 
be but one producer — the enormous government trust. 
The whole thing would be a slavery more minute than 
any yet devised. There is no control as senseless as that 
of a majority. The scheme of socialism is that each shall 
be the slave of all : this in spite of the fact that civiliza- 
tion had been made by able men choosing work, doing 
it, and directing it, in their own interest. Even if they 
have had to direct slaves, it was the masters who made 
the civilization, not the slaves. True, the laborers in 
Greece and Rome were slaves, and those countries 
managed to cut a very decent figure, but the voters were 
not slaves. 

236 (mi The un- But in our present state, socialism is 
employed. counted upon to dispose of the terrible 

question of the unemployed, and to give everybody 
good wages, but many people have not the ability to 
earn good wages. Then the socialists ask: why not 
have government give good wages anyhow? You 
admit that government should promote the general con- 
venience in many ways : why not in the most important 
way of all — give what it has become the fashion to call 
a "living wage"? Ought not everybody to have a 
decent living? Yes, if he can earn it; and of course 
everybody ought to be able to earn a decent living, 
just as everybody ought to be decent. But unfortu- 
nately, not everybody is; and we have already seen the 
effect of the attempt to give everybody decent wages, 
under the English poor law, and in the French public 
workshops (34). It is better a thousand times to receive 
charity direct than disguised as unearned wages. That 
step would fatally lower the standard of industry and 
— what is far worse — the standard of morality: one is 
frank mendicancy, the other is disguised robbery. 



232 The Protection of Rights, [§ 237 

237. Names Social- Enthusiasts for any specific panacea 

Ism and Indl- t1 , r j 

viduailsm. naturally invent a name for it, and then 

gravitate into some one name for all methods out- 
side of it. As soon as the two names are contrasted, 
they give an impression of 1 equal weight in the re- 
spective ideas which they connote. But this impres- 
sion is very misleading. Thus while the disciples of 
Hahnemann (if there are any real "high dilutionists " 
left) apply the term homeopathy to their doctrine, in 
the apparently balanced term allopathy they include 
all the doctrines that have been accumulated outside 
of their own. On one side, the word homeopathy in- 
cludes only one idea on the subject; but on the other 
side, the word allopathy includes all the experience of 
the human race. The same is true of the words 
socialism and individualism. To the superficial, they 
appear to represent two ideas that balance each other; 
but the fact is that socialism expresses a mere theory, 
and represents no experience whatever; while individ- 
ualism stands for the whole of human experience on 
the subject. Socialism has never been tried, all the 
progress of mankind has been made under "individual- 
ism". Greater and faster progress may be possible 
under socialism, as it may be under any scheme that 
any theorist proposes; but there is no experience to 
prove that it will be, while every atom of experience so 
far, goes to prove that it will not. It must be con- 
ceded, however, that the proof is not absolutely con- 
clusive, any more than is the proof that two and two 
will not sometime make five, or that men will not some- 
time live forever. It may even be farther conceded 
that in vast periods of time, there may be possible 
changes in human nature that may make socialism 
possible. There are even some grounds for conceding 
that there are visible factors working in the direction 
of such changes in human nature, and this concession 
may be made even in face of the facts that while these 
words are being written, the New York papers hold 
circus advertisements attracting people to see a young 
woman and an automobile turning somersaults in the 



§237 a] 



Personal Property. 



233 



air, the attractions of the performance being enhanced 
by calling it 11 The Dip of Death". But no more than 
all this can reasonably be conceded, and even these 
concessions leave no room to think of socialism as 
workable under any conditions so near as to be of 
any practical interest to any living man. 

There have been a considerable number of people, 
from Ruskin and Tolstoy down, whose emotion and 
imagination are far in excess of their information and 
reflection, and who jump in fancy to the realization 
of the socialistic dreams, without studying what founda- 
tion Nature has provided for them ; or if a foundation 
is possible, how long must be taken to evolve it. 

This word socialism has lately come into 
VllSSi S££ lam such verv frequent use (and abuse) that it 
calls for a little more consideration. In 
a long-past-midnight discussion between the present 
writer and an eminent professor of sociology, and an 
eminent speculative writer on Utopias, the last two of 
whom call themselves socialists, all three found them- 
selves agreed that government ownership of monop- 
oly franchises, and regulation of their operation by 
lessees for limited terms, is all that can reasonably 
be advocated under present conditions. The two 
"socialists" then claimed that their interlocutor, in 
agreeing with them, admitted himself a socialist. His 
counterclaim was that they, in agreeing with him, 
proved themselves not to be socialists ; whereupon the 
two agreed between themselves that they needed a new 
word to indicate their real position; and an ineffect- 
ive resort was made to the Greek dictionaries. If new 
labels are to be found for all the different positions 
held by those now included under the label socialism, 
all the dictionaries will be worked pretty hard; and 
probably names for the modern ideas will have to be 
constructed from the modern languages. 

The fact is that the word socialism is now made 
to do duty for' nearly every hoped-for cure of the 
defects of society — indeed for nearly every dream, how- 



234 



The Protection of Rights. 



[§ 237 a 



ever wild, of better conditions. Nearly every unedu- 
cated or unevenly educated person who is dissatisfied 
with existing conditions, calls himself a socialist, and 
many call themselves so on account of some opinion 
that may be anywhere from a belief that poverty is a 
bad thing, up to a conviction that if the state owned 
and administered all the means of production, poverty 
would disappear. Between the extreme positions, are 
at least the following stopping-places, some of the 
occupants of any one of which, like to call themselves 
socialists, and discriminating labels for each of which 
may be desirable: I. The state should regulate much 
23Kb). At least more thoroughly the use of all natural 
three meanings, monopolies, including the municipal fran- 
chises — waterworks, trolleys, lighting plants, etc. II. 
Municipalities should not part with the fees of their 
franchises for these things, but only lease them, 
so as to control them more effectively, and get 
the benefit of the unearned increment. III. Munici- 
palities — or the state — or the nation, should operate 
the franchises as well as own them. Now many men 
who hold the doctrines up to this, point, would warmly 
disclaim the name of socialist, and probably very few 
persons entitled to speak with authority would apply 
that name to any step short of government going be- 
yond the farthest of these points, to a fourth — beyond 
the natural monopolies, and appropriating the means of 
production which are not naturally monopolistic. 
238. Socialism I n this fourth use of the term, socialism 
against competition, means taking out of the fields of com- 
petition the things wherein competition is possible — 
depriving the world of the initiative and energy that 
competition breeds — of what has been well called 4 'the 
life of trade". While up to this point, government ac- 
tivity certainly should increase with government ability 
— in other words, with political intelligence and morality, 
beyond this point government interference with what 
we ordinarily mean by " industries would be inter- 
ference with what has raised society above the stage 
of mere militarism. 



§ 240] Personal Property. 235 

To the claim that socialism could have 
foHndividuaHsm? 6 ra ised society, and have raised it better, 
one answer is that it never did; and 
another answer is that no considerable body of pro- 
fessed socialists have ever agreed on the details for 
working out any consistent scheme by which they them- 
selves claim that it ever could. On the contrary, they 
are always quarreling among themselves. Moreover, 
there is no reasonable doubt that the best results of 
what various men claim could be attained by the variety 
of schemes which they call socialism, are being more and 
more attained through the only process of which the 
world has had experience — through individual capacity 
competing for private property, and voluntarily apply- 
ing an increased portion of private property toward the 
results that all good socialists and all good men desire. 
240 Socialism and Most of the people who believe in so- 
Magic an iilustra-" cialism (whatever they may mean by it) 
tion * attribute to it the power to produce these 

results by some sort of magic. For instance, after the 
San Francisco earthquake, the New York Times con- 
tained the following interesting letter: 

How Earthquakes and Fires would Lose Their Tbrror 
under Socialism. 

To the Editor of The New York Times: 

In the first place such a horror would not be possible under 
established Socialism, for every building constructed by and 
for a socialist system of society would be fire-proof, and in a 
great measure earthquake-proof. Cheap, flimsy, crowded, in- 
flammable, and unsafe constructions would find no place in a 
city built for use and not for profit. 

Given, however, present conditions, but with Socialism just 
adopted as a National system, the disaster at San Francisco, 
aside from the irreparable loss of life, would simply mean 
that each of us throughout the co-operated Nation had suffered 
a loss equivalent to a few hours of our productive labor. The 
whole resource and energy of the Nation would be aroused to 
replace San Francisco in a grander, more beautiful condition than 
ever before. The haunting fear of want that now oppresses 
thousands that were accounted well-to-do citizens would not be 
present. Thousands whose lives arc shipwrecked by this 
calamity, and whom the most generous aid possible under 



236 



The Protection of Rights. 



[§ 240 



capitalism cannot restore to hope and happiness, would, in a 
few weeks, recover their full former condition. With hope 
assured, they would rebuild their city on lines of beauty and 
safety, drawing on the surplus wealth of the co-operated Nation 
for all labor and materials required. In that new city none of 
the dives, traps, or squalid quarters which are now wiped out 
would ever be replaced. With no incentive for greed, graft 
or unjust gain the city of the Golden Gate would arise the 
gem of the Pacific Coast. The temporary loss, in all except 
the loss of life, would result in lasting gain by affording the 
opportunity to build the City Beautiful. Private land titles 
would not obstruct the public welfare, and the lesson would be 
worth all the fearful cost. Capitalism, with all its generous 
impulses, now temporarily aroused, cannot succeed as Socialism 
would do. 

This is a wider extension of socialism than I remember 
seeing proposed before. All the earlier propositions that 
I have seen, seem to have indicated that all the property 
of relatively small communities — states at the utmost, 
should be owned by all the citizens in common, irre- 
spective of who devises it, produces it, or preserves 
it. There seem to be fatal objections to even that 
scheme, among them its mad injustice; but the 
objections do not appear to have deterred this writer 
from proposing to have all the property in America 
owned collectively by all the people in America — a 
scheme that would involve difficulties of administration 
so far beyond any now faced, as to be simply unimagi- 
nable. 

241 Present Possibly the writer did not realize how 

agencies toward far, under the despised agencies now at 
tame ends. work, the losses of San Francisco actually 
are distributed. For instance, not to speak of the 
subscriptions for relief, eighteen millions of the losses 
are to be paid by insurance companies in the little city 
of Hartford alone. And the stock of those companies 
is by no means all owned in Hartford, but is distributed 
through the whole country. Considerable of the insur- 
ance thus distributed is in England: so the socialist's 
dream of our all being "members of one another" is 
already realized through the sordid channels of self- 
interest, more widely even than in his dream: for that 



§242] 



Personal Property. 



237 



stopped at the borders of our own land. Moreover, 
such sharing of each other's losses — and gains too, is 
constantly increasing. 

Yet his completed picture is at least a beautiful one. 
No one can doubt that the results of his prophecies are 
desirable, but how are they to be attained any faster 
than we are slowly approaching them now? The only 
indication given in the letter is that "socialism" should 
be "adopted as a national system" — apparently that 
Congress should pass some sort of a law, or that some 
sort of a constitutional amendment should be passed, 
to the effect that everything shall be owned by every- 
body, share and share alike; and that everything shall 
be done for everybody by everybody else, combined as 
the state; and that nobody shall have anything or do 
anything for his selfish self alone. When this law or 
constitutional amendment is passed, nobody shall be 
selfish or grasping, or inclined to hide away anything, or 
do scamped work, or disobey any laws that may there- 
after be enacted. 

Then the men with capacity enough to direct building 
operations, will be made more honest and capable by 
depriving them of their property and rewards, and 
paying them the same that the men they direct are paid. 
They are going to be more careful, energetic, resourceful 
— in short, build better buildings, because they can get 
no direct benefit from building better buildings. 

Some people who call themselves socialists would say : 
4 4 Oh no ! They must be paid in proportion to what they 
accomplish." But that is just what the world has been 
trying to bring about for several thousands of years, and 
has come a great deal nearer to bringing about during 
the past century or two than ever before ; and it is just 
what nine hundred and ninety-nine 44 socialists" in a 
thousand do not want: they want everybody paid the 
same, no matter what each accomplishes. 

We already have laws in most cities 
laws and Smef. 1 " f° r moderately secure building; but in 
spite of them, much crazy building goes on. 
But our socialist seems to think that if we pass a law 



The Protection of Rights. 



[§ 242 



requiring many times the care from builders that is 
anywhere required now, if we will merely include it 
with a lot of other laws under the label "socialism", 
people are going to obey the laws better; and that 
if these laws remove all reward of care, such laws will 
secure the care. 

Or can our writer intend to go so far as to imply that 
if the wisdom of Leland Stanford and his trustees had 
been replaced by that of the average building commission 
which universal suffrage would provide ; and if the name 
socialistic were given to such commission, it would turn 
out better work than Stanford and his trustees did. 

After the great Baltimore fire, wise and generous 
people hoped to " rebuild their city on lines of beauty 
and safety", but the majority, who consisted of stupid 
and selfish people, prevented all but a moiety of the 
schemes from being carried out. Now it would be 
interesting to know how long, on an average, the social- 
ists think it would take the stupid and selfish people 
who constitute the majority of the inhabitants of 
San Francisco and of all other places yet discovered 
outside of socialistic dreams, to pass a set of laws, even 
under the label of socialism, that would really "rebuild 
their city on lines of beauty and safety " more effectually 
than it is going to be built under present laws ; and how 
much longer it would take them to get the laws carried 
out after they had passed them. 

All the ingenuity and morality that San Francisco 
has been able to muster, have been trying for half a 
century to get rid of the city's " dives, traps and squalid 
quarters " ; but Chinatown has gone on burrowing under 
itself, and then under its burrows. 

"And there would be no incentive for greed, graft 
and unjust gain", says our prophet under the inspira- 
tion of socialism. All over the world, since even long 
before Christianity came, good men have been legisla- 
ting against "greed, graft and unjust gain", but these 
things continue. If the ingenuity and morality that 
have been fighting them, had labeled their efforts 
socialism, would they have had an access of magic 



§243] 



Personal Property. 



239 



power? Or would they have had to change the char- 
acter of their efforts? If so, why didn't they? Because 
they had not enough wisdom or conscience? How long 
then will it take to acquire enough wisdom and con- 
science to work socialism, assuming that enough of both 
may sometime be within human attainment? And by 
what methods are the wisdom and conscience to be 
attained, other than the preaching, teaching and general 
discipline of life, that have given us our present modest 
supply of those desirable qualities. Would labeling 
ourselves socialists create them? Would the label be 
more effective than the label " Christian* ' has so far 
been? Would the label give "Capitalism with all its 
generous impulses, now temporarily aroused' ', a more 
chronic amenability to those influences? And could 
the label be effectively put on "Capitalism", if by that 
word is meant the capacity which accumulates capital, 
without materially impairing its effectiveness? 

In short, is the word socialism as used in the letter, 
anything more than a name for a dream so far beyond 
any means of realization, as to make it of no interest, 
except as an ideal, to any living being; and a dream, 
like most dreams, full of inconsistencies that make it 
only dreamable — not thinkable? 

243. Another I* mav De worth while to spend a few 

specimen. minutes with one more of the latest of 

these philosophers.* He sums up his preface by 
r.sserting that the capitalist must learn that socialism 
"demands the right, nothing more or less than the 
right". As if the problem of the ages, only gradually 
approaching solution, and never quite to reach it, were 
not simply what is "the right"! 

He says: "The gateway of opportunity has been 
closed, and closed for all time. Rockefeller has shut 
the door on oil . . . and Carnegie on steel." As if 
these two men had not probably set more young men 
on their feet than any two men in history! 

* Jack London: War of the Classes. 



*3& 



The I 



requiring many tir 
anywhere required 
with a lot of oth< 
people are going 
if these laws rem 
secure the care. 

Or can our wt 
if the wisdom r 
been replaced 1 
which univers: 
socialistic wer 
out better w 

After the 
people hope 
and safety* 
and selfish 
schemes f 
interestin 
ists thin 1 

Who C07 

San Fr 
outsidr 
under 
their 
than 
muc- 
out 
/ 

ha 

ce . 
ii 



//.c „:.-;i; 




,7i ri'.i^'.gibie and rs*-#'r~. .. 
demand zxttrs «r.v »:/. r i 



\ 



§ 243] Personal Property. 



239 



power? Or would they have had to change the char- 
acter of their efforts ? If so, why didn't they ? Because 
they had not enough wisdom or conscience? How long 
then will it take to acquire enough wisdom and con- 
science to work socialism, assuming that enough of both 
may sometime be within human attainment? And by 
what methods are the wisdom and conscience to be 
attained, other than the preaching, teaching and general 
discipline of life, that have given us our present modest 
supply of those desirable qualities. Would labeling 
ourselves socialists create them? Would the label be 
more effective than the label " Christian" has so far 
been? Would the label give " Capitalism with all its 
generous impulses, now temporarily aroused", a more 
chronic amenability to those influences? And could 
the label be effectively put on "Capitalism", if by that 
word is meant the capacity which accumulates capital, 
without materially impairing its effectiveness? 

In short, is the word socialism as used in the letter, 
anything more than a name for a dream so far beyond 
any means of realization, as to make it of no interest, 
except as an ideal, to any living being; and a dream, 
like most dreams, full of inconsistencies that make it 
only dreamable — not thinkable? 

243. Another It ma Y be worth while to spend a few 

specimen. minutes with one more of the latest of 

these philosophers.* He sums up his preface by 
asserting that the capitalist must learn that socialism 
"demands the right, nothing more or less than the 
right". As if the problem of the ages, only gradually 
approaching solution, and never quite to reach it, were 
not simply what is "the right"! 

He says: "The gateway of opportunity has been 
closed, and closed for all time. Rockefeller has shut 
the door on oil . . . and Carnegie on steel." As if 
these two men had not probably set more young men 
on their feet than any two men in history! 

* Jack London: War of the Classes. 



240 



The Protection of Rights. 



He says: "The proletariat will possess itself of the 
government . . . and run the business of the country 
in its own interest." As if one man in a score could 
run business at all, and as if he would not keep a 
reasonably careful eye on his own interest rather than 
that of the country! 

He says: "The working-class is no longer losing its 
strongest and most capable members. There men 
denied room for their ambition in the capitalist ranks 
remain to be the leaders of the workers." As if the 
leaders of the capitalists were not now more from the 
working-class than ever before! 

He farther says : 41 Either the functions of private cor- 
porations will increase till they absorb the central govern- 
ment, or the functions of government will increase till 
it absorbs the corporations." Either the inroads of the 
sea will increase till it covers the land, or the waste 
from the land will increase till it fills up the sea. Both 
sets of propositions seem to mean something, but, like 
the phrase of the irresistible ball striking the impene- 
trable wall, they mean nothing. 

§*4. Need and A favorite expression of the ideals of 
esert. socialism is: "From each according to his 

ability, to each according to his need"; and if desert 
were generally measured by need, a beautiful expres- 
sion it would be. But the melancholy fact is that, 
despite many exceptions, desert generally varies in- 
versely as need — the deserving are not generally needy, 
and the needy are not generally deserving. Change 
the expression to "From each according to his ability, 
to each according to his desert", and you have a 
very intelligible and respectable ideal, and one toward 
which all the ages have been stumbling, and toward 
which every wise philanthropy, every good law, every 
enlarged communication, every facilitation of supply 
and demand meeting each other, every honest trade 
and every honest job, are leading up; and from which 
every enervating and confusing dream, every disguised 
robbery, every pauperizing charity, every unworkable 



§ 245] Personal Property. 



241 



statute, every obstruction of demand and supply, every 
dishonest trade and every scamped job, are keeping us 
back. 

Try to reach the ideal by any shorter cut, try to 
determine each man's desert by anything but the re- 
sults of his efforts, and who is to make the decision — 
a committee of Tammany Hall, or of a legislature, or 
of Congress, or of the labor trusts, or of the capital 
trusts? In regard to the very needy, it has long been 
attempted by government charity, by hospital and prison 
boards, by committees of churches, and by charity or- 
ganizations. So far it has been very imperfectly done, 
but no man has yet proposed any hopeful organization 
for doing it faster. It is going to be done better — im- 
perceptibly better to-morrow than to-day, a trifle better 
next week than this week, perceptibly better the next 
decade than tins decade, and noticeably better — better 
with even a much greater difference, this century than 
the last century ; as it was vastly better the last century 
than the century before. And all this betterment is 
to come from improvement in the agencies we know, 
and from better ones evolved from them. But it is to 
be less rather than greater, because of all revolutions at- 
tempted by unreasoning sentimentality, and rallied 
under phrases that inflame the imagination, but fall 
to pieces when searched for coherent meanings or prac- 
tical policies. 

245. Hlge-pressure Regarding the attempt to give govern- 
progress. ment more to do, the socialist says that 

the old ship of state under the orthodox sixty pounds 
of steam, is carrying us forward too slowly — that it is 
but mathematics that if we square the pressure, we 
will double the speed. Give her 3,600 pounds, and we 
shall go forty miles an hour where we now go twenty. 
The sober, student says that long before we get up to 
3,600 pounds, the whole thing will be blown to flinders. 
And while the socialist is dancing around and calling 
for his 3,600 pounds of steam, the inventor and educator 
and sane philanthropist are evolving a quadruple-ex- 
pansion engine to take us the forty miles. But the old 



242 



The Protection of Rights. 



[§ 245 



ship of state is not built for speed: she is a burden- 
carrier, loaded down with the faults and imperfections 
of the average man. 

246 Socialism Apparently, the only way of making the 
when possible, will socialist scheme work, is making voters so 
be needless. intelligent that they will elect only the 
best men, and making the best men so unselfish that 
they will work for others as well as they work for them- 
selves. On that basis, as it has taken some ten thou- 
sand years of recorded history to get us up to the 
present Senate of the United States, possibly ten 
thousand more might give us a governing body that 
could work socialism, but when people are able to 
work socialism, they will be able to take care of them- 
selves without it. 

Human affairs are so involved with each 
clvflizatfon Web ° f °ther that Spencer very justly compares 
them to a web. You cannot lift a single 
strand without power enough to lift the adjoining 
strands ; and you cannot lift a strand very far, without 
power enough to lift the whole with that strand. 



CHAPTER XX. 



PERSONAL PROPERTY (CONTINUED). 

Schemes for Distributing it more Evenly (Continued). 

(Ill) Trade-union Coercion. 

In times of peace, the forefront of politics is apt 
to be occupied by schemes of magic betterment. So- 
cialism and the schemes springing from trade-unionism 
are now competing for that position. It is not prac- 
ticable to give the former any farther treatment here. 
Regarding the latter, of all the impracticable schemes 
for equalizing the distribution of production, the one 
which is now probably deluding more people than all 
others, is Labor-Union Coercion to raise wages higher 
than the demand for goods and services will pay. 

As justice can be reached only through 
8*p 8 n'iy C ona r bon t ^ ie nat ural flow of supply and demand, to 
obstruct either by any sort of coercion, 
is to go counter to natural law, and going counter to 
natural law is one of the best definitions of immorality. 
But tho this principle is very simple, the application 
of it is often far from simple : every event is the result 
of many forces, and it is seldom that one force can 
be justly considered without reference to the rest. 
There is nothing more in accord with natural law 
than respect for life, and yet often respect for natural 
laws, involves disregarding life. For instance: regard 
for one's own life often calls for disregard for the life 
of another. So circumstances sometimes arise when 



243 



244 



The Protection of Rights. 



[§ 248 



morality requires a disregard of the natural flow of 
supply and demand. But those circumstances are 
probably all "exceptional and abnormal. At the time 
of the San Francisco earthquake, the equation of sup- 
ply and demand would often have required prices for 
food and water that even the consciences of the sellers 
would not permit. In that case, however, and in most 
similar cases, the short supply and the excessive de- 
mand did not result from human volition; and in the 
case of taking another's life to defend one's own, the 
conjuncture does not result from the volition of the per- 
son taking the extreme course. Indeed, it is probably 
safe to say that all situations which justify action that 
is ordinarily reprehensible, are forced upon the actor by 
outside conditions — usually by the reprehensible con- 
duct of another. On this principle it is probably true 
that action counter to the natural flow of 
offymaeiMlfSneL supply and demand is sometimes justifiable, 
but only when some natural catastrophe 
has already interfered, or when some unwarrantable act 
of man has made the case one of self-defence. 

Ordinarily justice can float in only on 
?u 4 P VK n bor? nd fluid competition, and until both sides pro- 
mote fluid competition instead of obstruct- 
ing it, justice will be impeded. Some employers try 
artificially to increase the supply of labor by making a 
given amount of money pay so large a number of men that 
they cannot have needed food and comfort, and by get- 
ting men to work so many hours that they cannot have 
needed rest and recreation. Trade-unions came into 
being to artificially limit the supply of labor, as a defence 
against such employers. But having found that some- 
times wages can be increased, hours shortened, and condi- 
tions improved by strikes, the unionists have jumped to 
the false conclusion that they generally can, and have 
gone on striking in season and out of season, until lately 
they have lost more from idleness during strikes than 
they have gained between them. They have at the 
same time made serious inroads on the capital of the 
employers from which their wages come, and on the 



§ *5° 6 1 



Personal Property. 



245 



capital of the community which calls for their work. 

They have also reasoned that, as a strike, to be 
efficient, must be close, it is justifiable to bring out- 
siders into the union by any means whatever. 

The idea regarding wages is a fallacy, and that 
regarding coercion of non-unionists is a mistaken and 
immoral assumption. 

ocn xu As wages are represented in cost of prod- 

250. Wages neces- , ^ 1 ■ 1 ,1 

sariiy limited uct, they cannot go higher than the commu- 

for p?JuS. and * s w ^^ n S to P av - Neither can they be 

or pr u materially raised by diminishing capital's 

share of product: for the capital in any trade made 
unprofitable by excessive wages, would first seek a 
more profitable investment; failing that, a more prof- 
itable country; and failing that, would tend to be 
consumed, as not worth saving. In any one of the 
cases, wages cannot stay at a point where they drive 
capital out. So with Ability, if wages get too high 
to leave Ability's profits in proportion to its degree, 
it will forsake the industry, and the laborers will be 
"out of work". 

250 (0), by com- The attempt to raise wages above the 
petition, normal can only succeed, even for a time, 

for but a part of the men, and must leave some unem- 
ployed. As Professor Laughlin well said in an ad- 
dress before the Citizens' Industrial Association of 
America : 

4 ' It means always and inevitably, the existence of non-union 
men, against whom the unions must constantly wage war. 
Under this system, high wages for some within a union can 
be maintained only by the sacrifice of others without the union. 
In short, the union scale of wages can be kept only by driving 
all other competitors from the field. The monopoly is only 
artificial, not real. . . . 

"But if all laborers were unionists, the situation would be the 
same, as regards supply, as if there were no unions. . . . Then 
the rate of wages for all in any one occupation can never be 
more than that rate which will warrant the employment of 
all — that is, the market rate. . . . 

"Obviously the union rate can be maintained only by limiting 
the supply of labor to members of the union and by driving 
out the non-union competitors. Consequently, the "inevitable 



246 



The Protection of Rights. 



[§ 250 b 



outcome of the present policy of many labor organizations, is 
lawlessness, and an array of power against the State. Having 
only an artificial monopoly of labor, their purposes can be 
successfully carried out only by force and intimidation." 

250 (oh by inoen- Moreover, high wages tempt to labor- 
tion - saving invention. This is well illustrated 

by the discovery of the New York bricklayers in the 
summer of 1905, that the substitution of concrete for 
bricks was taking away their means of livelihood. 
These bricklayers had one of the strongest of unions, 
and had driven their nominal wages up to four or five 
dollars a day. Their real wages for a year or two had 
not been much over half their nominal ones: for the 
nominal ones had been obtained through the notorious 
building strikes with their accompanying idleness. In 
the spring of 1905, after the city's long deprivation of 
builders, the demand for them was ravenous, and 
the bricklayers expected a season of unprecedented 
prosperity. But paying high wages had set builders 
to experimenting, and to discovering that a dollar-and- 
a-half laborer with a supply of cement and small stone, 
could mix and pour into moulds more wall in a day 
than a five-dollar laborer could lay with bricks. 

Invention, then, puts a limit to possible wages, as 
effectually as does the choking of demand that high 
wages must cause, or the competition of labor attracted 
from trades where wages are lower. The disregard of these 
unescapable facts by the unions has cost them dearly. 

Yet the unionists may acknowledge the force of what 
has been said, and still doubt if they have at the time 
reached the possible limit of wages. They are doubly 
ready to doubt it when they consider the wealth in other 
hands; and as they are not inclined to the slow and 
arduous ways that placed it there, and do not often 
possess the ability to take those ways, they are naturally 
prone to the strike. But of late they have so often 
exercised it only to demonstrate its fallacy — to reach 
through times of privation a scale of wages so high that 
the public will not pay it — that they must be getting 
some inkling that the method is fallacious. 



§ 252] Personal Property. 247 

The other assumption of the unions — 
tbli tfttt*" that an y method— picket,boycott, violence, 
murder, is justifiable to keep the union 
close, hardly requires discussion. The few who sup- 
port it on any basis of professed reasoning, assume that, 
as the state holds the property and even the life of the 
citizen subject to sacrifice for the greatest good of the 
greatest number, the trade has the same moral right 
over each of its members. The alleged justification — 
offered in various forms — for these attempted infringe- 
ments on liberty, is the greatest good of the greatest 
number, but at best that can only mean of "the greatest 
number " in the trade in question; and their good is 
avowedly sought through price? enhanced at the ex- 
pense of the greatest number of the community (258 a). 
Here should be most carefully and thoroughly realized, 
what was briefly touched upon before: first, that the 
principle of "the greatest good of the greatest number" 
can be applied only to actually "the greatest number" — 
the whole community — which the greatest number of a 
minor section can never be; and, second, that the ascer- 
tainment and securing of what is the greatest good of 
the greatest number, tho it has taxed all the wisdom 
of all the ages, has even yet been only approximately 
attained; and that so far as it has been attained, it is 
expressed in the existing body of laws made by all for all. 

252^Aimed ag*fost So much for the principles involved . Now 
a a nd or pub?ic. p ° yer ' to come to details. Trade-union coercion 
is threefold: It is directed primarily against the enter- 
priser, through strikes and boycotts; but secondarily 
against the laborer, to prevent his giving the benefit of 
competition to the enterpriser, or incidentally to himself 
when he happens to be unemployed : the union wants 
nobody competing with it, and therefore tries coercion 
to get all men to belong to it, and to stand idle when 
it is idle. And third, the coercion is directed against 
the public — to compel public opinion to endorse labor's 
contentions, by stopping transit, coal supplies, food 
supplies, and other necessities and conveniences. 



248 The Protection of Rights. [§ 253 

253. Coercing the As to coercing the employer: the time 
employer. during which the laborer can stand idle 

without a loss that is serious or fatal, is much shorter 
xhan the time during which the enterpriser can — the 
laborer cannot afford to wait for a good bargain, while 
the enterpriser can. The union therefore tries to in- 
crease the laborer's ability to wait, and to diminish the 
employer's ability to wait. This is often done by 
making the settlement of a difference depend not on 
the employer doing without the laborer with whom he 
differs, but doing without any laborers at all. 

Now there can be no objection to any peaceable 
efforts necessary to secure to labor the full benefit 
of the natural demand for labor. They become ob- 
jectionable only when they deprive the employer of 
the full benefit of the natural supply. If a laborer 
thinks that demand for labor justifies higher wages, 
it is perfectly legitimate to test the question by leaving 
the work, and seeing if the place can be filled at the 

tk Qtiir price. But when the test is attempted 
z:>4. The btrike. by &u the men stopping work tog ether, it 

is not made by the natural flow of supply and demand : 
the natural flow would be for each man to take work 
elsewhere, when tempted by a natural demand in the 
shape of higher wages elsewhere. This would not in- 
volve stoppage of the business : the question could thus 
be tested without shock or material loss on either side. 

But there are obstacles to this ideal test, obstacles 
often so great as a change of the laborer's residence. 
These obstacles would prevent his getting higher wages 
elsewhere, unless the wages were enough higher to 
justify the expense and inconvenience of whatever 
change might be involved. This expense and incon- 
venience may readily be greater than would be involved 
in a strike, and the laborer's rights might be better 
conserved by waiting until enough men were discon- 
tented to unite in a strike. But not only is the strike 
against whatever rights the employer may have to get 
the question of higher wages settled gradually without 
stopping his works, but strikes are in many instances, 



§ 255] 



Personal Property. 



249 



perhaps in most, forced by a minority, or undertaken 
by men who are not discontented, but who only act 
in sympathy with a strike elsewhere. 

Conversely, the employer cannot be expected to carry 
on work at prices that are not profitable, and an entire 
stoppage of the works may be as much to his interest 
sometimes, as at other times a strike may be to the 
interest of the men. But ordinarily it would be in the 
course of nature for him to try to reach a lower scale 
of wages gradually, rather than proceed to a lockout, 
and both incur idleness himself, and deprive his men 
of their means of subsistence. 

Thus in both directions, the rights of master and 
man often connect. Men with reason and morals can 
generally settle their conflicts by discussion and com- 
promise, but beasts can settle them only by war; war, 
however, is justifiable only as a last resort, and strikes 
and lockouts are war. 

Lockouts, however, play but a small part in indus- 
trial troubles. The U. S. Bulletin of Labor for Sep- 
tember, 1904, shows that from 1881 to 1900 inclusive, 
there were over twenty times as many strikes as lock- 
outs, and the employers lost over five times as much 
by strikes as by lockouts. In the five years 1 896-1 900, 
the strikes increased to over thirty to one lockout; 
and the ratio of loss increased three and a half fold; 
tho if the years 1895-1899 were taken, it would show 
a fall in strikes to about fifteen to one lockout. In 
view of the facts, then, we may reasonably continue to 
confine our consideration to strikes. 

In all the coercion, the justice of the case has been 
obscured by many things — most perhaps by what seem 
to be the plain facts that a man has a right to stop 
work when he pleases, and to buy or not buy where 
he pleases; and that what one man has a right to do, 
any number have a right to do together. 
255. Conspiring to But in all strikes and boycotts there is 
stop work. more than the exercise of the mere right 

to stop work or stop buying. What leads to all the 
outrages is conspiring to stop work or stop buying. 



The Protection of Rights. ~ ■ [§ 355 



Even granting to the individual the fullest right to 
do either, there still remains serious question of his 
right to enter into conspiracy with other men to do it 
together, when they unduly prejudice the rights of 
others — when, for instance, not to speak again of private 
wrongs, they bring an industry — especially a public 
utility, to a sudden and disastrous standstill. 

Moreover, even leaving out the many cases when the 
men are ordered out against the real wish of the majority, 
or because some other men have struck, and considering 
only the cases where men strike because they really 
want to, does each man stop work when he pleases, or 
do the discontented stay at work after they have 
become discontented, in order that all may quit work 
together, to the greater inconvenience of the employer? 
Such a course is admittedly a conspiracy to injure the 
employer, and the right to take it is seriously questioned, 
even by the law. Similarly, of course, with the boycott 
coercion. 

256. other coer- Beginning with occasional and often 
clons « entirely justifiable demands for higher 

wages and shorter hours, the unions have gradually 
added limitation of apprentices; limitation of a ca- 
pable man's output co that of an incapable man; re- 
fusal to handle material from previous non-union pro- 
ducers, or material coming from other shops, or mate- 
rial not prepared in their own city, before they have 
duplicated it and destroyed the duplicate; and hosts 
of other regulations of their employers' business. The 
employers have yielded point by point until the de- 
mands have reached the logical conclusion of that 
for the "closed shop" — closed to all but union men, 
and that the foreman shall be a union man chosen 
by the men, instead of by the man who pays his wages. 

In 1906 the Typothetae of New York thus stated a 
situation that is by no means restricted to their trade: 

"The employer cannot put his own son to work at the 
machinery in his own composing-room until that son, after four 
years' probation, swears allegiance to the union, subscribing to 
an oath that puts obedience to the union above his duty to 



§257] Personal Property. 



family, church or state. The employer cannot hire or dis- 
charge his own men; they must be hired or discharged by a 
foreman, who must himself be a member of the union. An 
employer cannot operate the keyboard of a machine that he 
has paid for, or set his own type ; he is not allowed any repre- 
sentation in his own composing-room. The composing-room 
is controlled by a union foreman, assisted by a union chair- 
man elected by union men, the chairman's duty being to 
see that neither the men nor the foreman shall for one moment 
forget any of the numerous restrictions which the union has 
placed on the running of the shop." 

In the last analysis, the object of the unions has been 
to break down the laws protecting private property — 
factories, stores, mines, transportation agencies, in 
order that they, instead of its owners, may control 
it and derive from it what revenue they please. This, 
it need hardly be pointed out, is one of the forms of 
confiscation grouped under the general term Socialism. 
Even if they were to succeed in their contention, noth- 
ing can be more certain than that, if the property 
were without the guidance of the superior minds which 
created it, the returns from it would fall off, and the 
revenues to the workman would diminish, and in 
many cases — in all, if the principle were carried out 
to its .logical conclusion — would cease altogether. 

At this point, the employers have decided to resume 
control of their own businesses, and to run the "open 
shop" — shops open to whom they please to engage, on 
terms satisfactory to their own side as well as the 
other — and the parties are in the midst of a disastrous 
conflict. There can be but one end to such a conflict. 
Some weak employers in the printing trade have yielded 
for the moment, because they could not afford to stop 
work; but the strong ones are holding out simply 
because they must. The question is simply whether 
they shall control their businesses or give them up. 
The laborers cannot afford to have them given up. 
257 Misieadln Most of the discussion of strikes in the 
statistics of " g later literature of the subject, of course 
strikes. en( j s w ^ t he censtls of 1900. Based on 

the facts up to that time, Professor Adams says: 



252 



Tlie Protection of Rights. 



[§257 



' ' In the Final Report of the Industrial Commission (page 864) 
it is pointed out that although on the average of the twenty 
years 1 881-1900, about 330,000 persons were thrown out of 
employment annually by strikes and lockouts, this number 
constituted only about 3.36 per cent, of the persons employed in 
industries affected by strikes. The actual time lost by strikers 
in this period amounted to about 194,000,000 days. However, 
'spread over the whole period, this loss amounts to very much 
less than one day per year for each adult worker. In other 
words, the workmen of the United States have lost less time 
from strikes and lockouts than from the celebration of the 
Fourth of July or any other legal holiday. . . .' Similarly, on 
the basis of the figures of the Department of Labor, Mr. Mitchell 
calculates that the immediate loss traceable to strikes amounts 
to only about 3 cents per month for each inhabitant." 

Now the madness that ruled the unionist world from 
1900, the last year considered in the foregoing para- 
graph, to 1906, when these words are written, would 
make that paragraph,* if applied to the more recent 

* Professor Adams deduces from a table of strikes from 1 881 to 
1 900 some conclusions that are strange to find in a book usually 
as reliable as his. One is that unionism has tended to lessen the 
number of strikes. In support of this he deduces the fact that 
in '86-90 there were 4358 union strikes, while in '96 to iooo 
there were but 4175. But I find that the same table shows that 
in '8i-'90 there were 5669 strikes, which in '91-1900 rose to 
8,788, and even that his five years '86-'90, containing 4,358 
union strikes, were followed by five years, '9i-'95, containing 
4.613. 

Moreover, in the two periods he selects, he compares the 
non-union strikes with the union strikes, with the showing 
that the union strikes decreased four per cent., while the non- 
union strikes increased ten per cent. But if he had taken the 
two decades that I have taken from the same table, these 
figures would have been that union strikes had increased fifty- 
four per cent, (instead of diminishing two percent.), while non- 
union ones had increased but thirty-five per cent. Since 1900, 
the statistics are not available, but no observer can doubt that 
the facts have been even vastly more in the direction that 
my comparison of the two decades shows, or that the unions 
have fomented strikes to a degree that seems to mean nothing 
short of the madness of those whom the gods wish to destroy. 

Of course it is not to be supposed that Professor Adams 
deliberately selected fractions 01 each decade which happened 
to support his theory, and yet a glance at his table reveals the 
showing of the whole twenty years to be startlingly counter to 
that of the two periods he has selected. 



§ 253]. Personal Property. 253 

period, the wildest nonsense — a fact which it is impor- 
tant for writers to point out as long as current facts 
and previous facts continue in such direct contra- 
diction — probably until the census of 19 10 shows the 
conditions of the last six years, and, it is to be hoped, 
the subsidence of them. Favorable symptoms of the 
subsidence are the rise of the employers' unions and 
citizens' industrial unions, a great decrease of strikes 
since 1903, and the falling off, in 1904, of the member- 
ship of the trade-unions, which is not yet made up, 
despite the subsequent full employment and high 
wages. 

258. Coercing the As to coercing the laborer: there is no 
laborer. question that the trade-union would be 

more efficient as a monoply, and that it has a right to 
persuade men to make it a monopoly. But equally is 
there no question that it has no right to add violence 
or intimidation to persuasion, or that the unions have 
at last become so used to artificially limiting the supply 
of labor, have become such adepts in it, and have de- 
rived such advantages from it (tho largely illusive ones), 
that they have got in the way of doing it under un- 
justifiable circumstances, and by unjustifiable means. 

Among the means, as already said, is the use of 
coercion to limit the number of apprentices. Such a 
policy, even among shipwrecked sailors struggling for 
a raft too small to hold them all, is not easily 
regarded with patience, and when it is persistently pur- 
sued by men already supplied with the necessities of 
life and not a few of its luxuries, its cruelty and selfish- 
ness are beyond excuse. Its absurdity is often on a 
par with them: for instance, in several trade-unions — 
notably in the typographical ones, it has now got to 
the point where a father cannot teach his trade to 
his son in his own shop, without the consent of the 
union ; and it need hardly be pointed out that if limita- 
tions were practiced by all trades, more of the com- 
munity would be reduced to the position of labor too 
unskilled to be organized — of that pitiable residuum 



*S4 



The Protection of Rights. 



[§258 



"the unemployed which is drawn upon only when 
nothing better can be had. 

On the other hand, some trades, as in the printers' 
strike of 1905-6, have forced employers to teach the 
trade to so many outsiders, that many of the strikers 
themselves, on wanting work after the strike has failed, 
find their trade overcrowded. 

Appreciating the value of unity of action, whether 
the cause be right or wrong, the unions have stopped 
at no crime in the effort to secure it. Not content 
with the savagery of pushing apprentices off the raft, 
the unions are given to boycott, violence and murder, 
to coerce men to stop work against their will; and 
all these steps are habitual in quarrels not their own; 
and in strikes entered upon when the employers have 
done no wrong. The Chicago Tribune claims to have 
statistics showing that in the United States from 1894 
to 1904 inclusive, there were three times as many 
murders committed in riots to coerce laborers, as in all 
other riots put together. 

The unions have set no limits to the ends they hope 
to attain by coercion of laborers. Reason and justice 
require that, other things even, the lowest bidder should 
258 (a), ne obtain work. The unions wish to elimi- 
Labor Trust. na t e all bidding among laborers. They 
have made the euphemism of ''collective bargaining", 
and claimed a mass of virtues for it — correctly claimed, 
if their own side alone is to be considered. But no 
human ingenuity can extract from the phrase or the 
idea, anything but an absolutely close labor "trust": 
that is precisely what all trusts are made for — collective 
bargaining — eliminating individual competition. This 
is not saying, however, that trusts — whether labor 
trusts or capital trusts, necessarily merit condemnation; 
but it is characteristic of the low intelligence which 
must accompany low productive power, to exalt the 
labor trust while condemning the capital trust. 

Each labor union is trying to form a trust controlling 
its branch of labor, and the American Federation of 
Labor is a trust trying to include them all. To deny 



Personal Property. 



*55 



this would be so absurd that many of the members 
frankly confess it; and while other trusts have the 
decency at least to profess to lower prices, the members 
of the labor trusts all confess, at least indirectly, 
that their object is to advance prices. Few if any of 
them have the intelligence to realize that all labor 
trusts but each man's own, are advancing prices against 
him, and that even his own advances the price of such 
of its commodities as he uses. As so often said already : 
they do not think as far as their outgo, but only as 
far as their income. Their ideal "collective bargain- 
ing" is that there shall be but one bargainer on their 
side, and that the laborer shall be taken at his price 
or not at all, even if babes go without milk, and the 
whole community without meat and coal. While the 
unionists cry out most bitterly because the capital 
trust is only "one bargainer", while they are the most 
bitter denouncers of the capital trusts* destruction of 
competition in things which unionists realize that they 
themselves use, they are ready to override everything 
to destroy competition in labor. While they denounce 
the Standard Oil Company and the American Steel 
Company for absorbing outsiders through business com- 
petition, they themselves habitually try to absorb out- 
siders by the bludgeon. 

In trying to limit the right to work and to contract — 
the right of demand to seek supply, and of supply to 
seek demand, in a free country, they are attempting an 
impossibility — without freedom to work, freedom to 
contract, and freedom to compete, no country can be 
free: the condition of the workman must be simply 
that of the slave, and the slave of the worst tyrant 
known — a wrong-headed majority. 

259 Coercln ^ s to Coercing the Public, everybody 

the 'oubii? " g knows illustrations enough, but some will 
The union label. help tQ a clearer understanding of the 

rights of the situation. 

A scheme of the labor trust has been to coerce the 
public from buying any goods not bearing the union 



The Protection of Rights. 



label. It has tried the scheme in many ways calling 
for the same charity that we give to children when 
they do things whose enormity they do not realize. 
One is the ingenuous step of demanding legislation 
to enforce the scheme, — a step which no capital trust 
would be either so bold or so innocent as to attempt. 
Perhaps it was a step more ingenuous still, when a 
labor trust began interfering with education by noti- 
fying publishers that union influence would be used 
to drive out of the Boston schools any books that did 
not bear the union label. The tendency of such a 
policy is of course to lead people of independent spirit, 
wherever possible, to avoid using goods with the union 
label. I have even known a case where a person 
who responds with considerable freedom to circulars 
asking for aid for deserving charities, has ceased pay- 
ing attention to those which bear the union label. To 
an obvious criticism, he responded that, whatever 
those bearing the union label might deserve, there 
were enough not bearing it, to justify concentrating 
on them all the money he could give. 

And yet with all the claims for the union label, the 
highest New York court in 1906 would not sanction a 
requirement of it in the contract for the public printing 
of Onondaga County, pronounced the requirement 
' ' against public policy and unlawful", and said that 
"the Board with just as much propriety, so far as its 
legal right is concerned, might have permitted only 
Baptist or Unitarian printers to enter the bidding list". 
The decision is very full in citation of supporting cases. 

The following paragraphs from the New York Times 
of May 12, 1906, may cast some farther light on the 
alleged right to coerce the public into endorsing a 
labor contention, by stopping work: 

"When the strike of the Funeral-Drivers' Union 
Hlustratloru & ot un( ^ er wav yesterday, New York witnessed 

such scenes as the city never before saw. 
14 Several funerals were abandoned by strikers when the dead 
were between the church and the grave. 



§ 260] Personal Property. 



257 



"Of 103 funerals that had been set for yesterday in the city 
only 23 were finished. The carriages of some of those were 
stoned by the strikers or their sympathizers. 

" Farrell's funeral was set for one o'clock. Several carriages 
and a hearse had been drawn up to the door, when a walking dele- 
gate from the union ordered the drivers to go back to the livery 
stable. They went back. Th.n came the news that the livery- 
stable owner had ten other funerals, and had been obliged 
to sign the agreement. The carriages returned to the house of 
mourning, but came back with flying colors. On the heads of 
the hearse-horses were two red, white and blue flags, and on 
the bridles of each of the carriage-horses tiny flags signified a 
victory for the funeral-drivers. The mourners protested, de- 
claring that the funeral procession with the flags would look 
like a west-side chowder club. But with the union's flags 
flying at the heads of the hearse- and coach-horses the funeral 
went on to the cemetery. " 

In another case "The Rev. Father John C. Henry . . . was 
delivering a eulogy on the dead man when there was a com- 
motion at the church door. ... A committee from the striking 
union had called the driver of the hearse and ordered him to take 
his hearse back. . . . The coach-drivers were ordered back. too. 
Leaving the body and the mourners in the church, the hearse- 
driver and the coach-drivers drove away. The sexton . . . went 
about notifying the mourners of the situation and telling them 
to remain in their pews until matters could be straightened 
out. . . . The police reserves from two precincts were sent to 
see that the strikers did not again interfere with the funeral. 
Then Undertaker Hagan hitched one of Undertaker Slevin's 
horses to an undertaker's wagon, and returning placed the 
body in the wagon. The immediate relatives of the dead 
man accepted the offer of a private carriage that had taken a 
party to the funeral, and then followed the body to Calvary 
Cemetery. The rest of the mourners went to the cemetery 
in trolley cars, after this funeral had been held up for two 
hours. 

"In another case, up in the Bronx, the body was put in a 
milk-wagon and driven to the cemetery, while the mourners 
rode in surreys and grocery wagons." 

In another case 4 A large number of the striking funeral 
drivers assembled opposite the Ogle home at 8 o'clock. The 
police reserves were sent for, and drove the strikers away. 
. . . Four men appeared carrying the coffin on their shoulders 
and followed by the mourners, who walked. 

* 4 Dr. Guilfoyle granted an extension of the burial permit in 
the Weaver case, so that the body could be held at the house 
until to-day. The law forbids the holding of a body more 
than four days. . . . The Weaver family, like others in mourning 
for their dead, were compelled to sit up another night with 
their dead relative. 



The Protection of Rights. 



[§ 260 



"The funeral of Antonio Le Grabier . . . was headed off by 
a committee of strikers, who ordered the hearse-driver ancl 
the coach-drivers to leave their seats. They pulled up, leaving 
the coaches and hearse in the roadway. ..." 

In another case " Striking drivers ran out and tried to drag 
Undertaker Lumoro from his seat on the hearse. Policeman 
Gleason, one of the guards, ran at the strikers with his club and 
drove them away. The funeral then proceeded, . . . but still 
followed by the mob of striking funeral drivers and their 
friends. 

"At the ferry the mob threw sticks and stones at the hearse 
and coaches. The mourners climbed out of the carriages and 
took refuge in the ferry-house. 

"A man asked Dr. Guilfoyle to hold the body of his child for 
another day. He said the child had died of measles, and that 
the undertaker told him the body would have to be taken to 
the cemetery in an express wagon. 

" 'My wife is very ill', he saki, 'and she vows she will not 
permit anyone to place our child in an express wagon. If I 
can get a permit to hold the body for twenty-four hours more, 
it will be the means of probably saving the life of my sick wife.' 

"Dr. Guilfoyle granted the permit. 

"It was said at the Health Department that if an attempt 
is made to-day to hold up funerals the police will be called on 
to make arrests under Sections 314 and 315 of the Penal Code. 
Section 314 provides that any person who detains a dead human 
body on any demand is guilty of a misdemeanor. Section 315 
says : 

" • A person who, with or without authority of law, obstructs 
or detains any person engaged in carrying or accompanying 
the dead body of a human being to a place of burial is guilty 
of a misdemeanor.' . . . 

"Dr. Guilfoyle said the strikers yesterday had held up the 
funeral of a person who died from diphtheria. This was a 
serious matter, he said,, as the body had been held over the 
twenty-four-hour limit without the Health Department's per- 
mission." 

The right to stop work! Has anybody 
stop worit. r,ght t0 a right to anything which will lead to such 
barbarities as these, or such as may be read 
of in connection with a large proportion of all 
strikes ? 

Undoubtedly, other things even, any man has a right 
to quit work when he pleases. But plainly there are 
cases where other things are not even. I cannot treat 
this important subject better than I have done else- 



§ 262] Personal Property. 



*59 



where,* and I will therefore use again the passages 
with slight modifications. 

In any contract for work, even if terminable without 
notice, certain things which it is superfluous to express 
in the contract, are always understood. One of those 
things is that neither party shall wilfully use the relation 
between the two, to the damage of the other, or of any- 
body else. Nobody would say that a workman whose 
business it is to connect water- or gas-pipes has a 
right to quit work the moment he has tapped a main, 
without making his connection or stopping the leak; 
nobody would claim that a surgeon has" the right to 
stop work after he has cut a man's leg off, before stop- 
ping the blood and putting the stump in order ; nobody 
would claim, indeed, that an actor, having gathered 
his audience together, has a right to stop in the middle 
of the play, even if he returns half the entrance -money. 
... No fair-minded person can fail to see that railway 
employees have no right to quit work while trains of 
passengers, animals, or perishable freight are likely to 
be delayed ; and as the welfare of the whole community 
depends not only upon trains being carried to their 
destination, but upon their being regularly run at their 
usual intervals, it also follows from the same considera- 
tions, that no railway employee has a right to quit 
work under any ordinary circumstances without giving 
notice reasonably sufficient for the procuring of a sub- 
stitute if one can be had, or for making some reasonable 
arrangement if one cannot. And in all cases, the 
laborer's right to stop work is limited by the rights of 
others to have their interests put in safe or reasonably 
complete condition before the laborer leaves them. 

262. The com- The parties to this question are no longer 
munlty's defence, merely the employer, the striker, and the 
possible man glad to take his job, but there is a fourth 
man who is of vastly mere importance and power than 
any of them, and who, as soon as he becomes fully 



* " Sturmsee third edition, pp. 409-12. 



260 



The Protection of Rights, 



alive to his rights, is going to settle them in a way 
that will brook no cavil or resistance. This fourth man 
is the average citizen — agglomerated as the community 
at large. In the United States, he represents to-day 
over forty million adults (including his wife) and over 
eighty million people, including his children, whose 
milk supply (not to speak of the family food and fuel, 
and his convenience of passing between house and 
business) has been held up a little too often by the 
mere convenience or whim of some two million persons 
belonging to .the trade-unions. If his rights had been 
violated because of the necessities of these people, 
or of crying injustice inflicted upon them, he would 
have felt sympathy and patience. But they have been 
too often held up, not by men quitting old jobs and 
seeking new ones, as discontent and opportunity arose, 
but by conspiracies, for poor reasons, to stop work and 
make others stop work, together. 

There has been a principle upheld among Anglo- 
Saxon people for a good many hundred years, tho 
suffered to lapse into occasional desuetude, that men 
conspiring to do a thing unobjectionable if they do 
it separately, but working harm to the rights of an- 
other or of the community if they do it together, are 
guilty of a criminal act; and the community is rapidly 
being forced into a disposition to visit on such crim- 
inal acts, their proper penalties. The work has begun 
already. 

263 Socletv a ?^ ress i° ns a * l ast have forced 

organizing ' combinations not only among the em- 
ln self-defence, p i oyerSj but among new forces that are 
irresistible — those of the community in general. Few 
labor unions can see beyond their own ranks; they 
forget that their exactions must be met not merely 
by their employers, but by all who use the product, 
including even members of other unions. 

In 1 901 the first Employers' Association was formed 
in Dayton, Ohio. Before that time employers had 
quite generally sought to profit by each other's troubles, 
instead of uniting against all unjustifiable trouble. 



§*6 3 ] 



Personal Property. 



261 



In 1 901, an Employers' Association was organized in 
Chicago, and many other cities soon followed suit. 

About the same time street-car operatives had been 
making serious trouble in Montana, and miners doing 
the same in Colorado. Remembering the Vigilance 
Committee of San Francisco, the people organized 
similarly, many workmen, even, being on the side of 
law and order. Nearly four hundred of these associa- 
tions have grown up and are now combined in the 
National Citizens' Industrial Association "for the pro- 
tection of the common people", which publishes a 
valuable organ, 44 The Square Deal". It includes the 
National Association of Manufacturers, comprising some 
three thousand firms and corporations, whose organ is 
"American Industries"; and also the powerful "Anti- 
Boycott Association". Thus the intelligence, capital, 
and rights of citizenship of the country are at last 
arrayed against the excesses of the unions, and by or- 
ganized appeal to the law, have obtained important 
decisions against them ; * have prevented much class 
legislation; and are disseminating valuable education. 

The National Association of Manufacturers has estab- 
lished free employment bureaus to give independent 
laborers work which strikers have refused.f The 

* " In three fourths of the Chicago strikes, injunctions have 
been secured restraining strikers from interfering with non-union 
men, on the ground that it was a conspiracy to prevent work. 
Hence the anti-injunction bill which the American Federation 
of Labor has tried hard to put through Congress. This bill, in 
the opinion of Mr. James M. Beck, chief counsel of the American 
Anti-Boycott Association, 4 legalized conspiracies ' between 
unions, but made it impossible to enjoin them." {From an 
article in the Chicago " World of To-bay" by Mr. Isaac F. 
Marcosson) 

t " Nearly every strike ending in a victory for the open shop has 
been followed by the establishment of a labor bureau. The union 
men call it a black-list agency, because it keeps a check on a man's 
record. The National Metal Trades Association furnishes a good 
example. It runs open shops. Any man of good character want- 
ing a 30b in the metal trades can apply there and in four out of five 
cases he secures work free of charge. The secretary investigates 
the man's record. All the facts about him are put on a card 
which is kept in a permanent card catalogue. In this way 



The Protection of Rights. 



[§ 263 



employers ' organizations, in nine tenths of the cases 
which they have taken up, have established the open 
shop, where the unions have tried to destroy it. 
264. Educational Great as has been the immediate eco- 
Results. nomic value of all this experience, its 

educational value must be greater still. Both are indi- 
cated in the simple fact stated before, that while in 1903 
there were in Chicago 1,300 strikes, in 1904 there were 
but 800. Unless all strikes are wise and justifiable, it is 
reasonable to presume that the falling off in 1904 was 
in the class of those that would not have been so, while 
the number that did take place is apparently large 
enough to include virtually all that could have been 
wise and justifiable; and more workmen are apparently 
learning not to strike wantonly, while they still re- 
tain the spirit to maintain their rights. 

Thus the unionists may have lately begun to learn, 
that after all there is no more magic in coercion than 
there is in the other nostrums for getting much by 
the man who produces little; and they are learning 
it, as the uselessness of the other nostrums has had 
to be learned, at frightful cost to themselves and the 
community. 

If more of such teaching is needed, it may get so 
far that the twenty million men who are not in the 
habit of striking, may outvote the two million who 

the disturbers are kept out of the shops. Last year the Chicago 
labor bureau of the metal trades had 4,850 applicants and 
3,000 men got jobs. 

"Bureaus in different cities kept in touch with one another. 
If a man applying in Kansas City lies about the reason why 
he left a job there, he is sure to be found out if he applies in 
New York. If a strike is threatened, for instance in the New 
York metal trades, a central secretary can send a telegram to 
every labor-bureau secretary, asking him to rush men to New 
York. In twenty-four hours a hundred boiler-makers would 
be on their way from Kansas City, St. Louis, Chicago, Cincin- 
nati, Philadelphia and a dozen other places. 

"These bureaus have made leaders cautious about calling 
men out. Formerly they called a strike and then considered 
the grievance. Now they consider the grievance first." (M ar- 
oosson, op. cit.) 



§ 264 <*] 



Personal Property. 



are. All strikes have been declared criminal by statute 
before now. Even in Australasia, "the Paradise of 
Labor", the mere attempt to foment one is subject 
to heavy penalties (291), and if the proportion of them 
which unquestionably are criminal even under our law, 
should again increase as rapidly as they were increasing 
before people began the checks just described, all 
strikes may be declared criminal again, and strikers 
reduced to depend only on verdicts of not guilty where 
the strike is justifiable, just as such verdicts are found 
in the rare cases where killing a human being is justifiable. 
. ™ Probably the workingman would be 

264 fa). The com- J , & T - 

munity'8 defence the gainer if they were. In the modern v 
wni defend the world, the undisturbed laws of competition 
workman. WO uld probably take better care of him, 

than, in his recent mad attempts to overcome those 
laws, and in his subservience to his walking delegates 
and Sam Parkses, he has succeeded in taking of himself. 
But probably he will not drive society to any such ex- 
treme. Other agencies are opposing his errors, and he 
is coming to recognize them and, it is to be hoped, to 
be the gainer in consequence. 

If the justifiability of such strikes as those of the 
last few years had had to be passed upon by judges 
and juries, few of the hurtful strikes would have been 
undertaken, while the laborers would still have felt 
free to enter upon those deserving of public sympathy, 
* and therefore likely to be of real use. If all unionists ap- 
preciated as well as those of Australasia seem to (278 a) , 
the advantages sure to accrue to them from such legal 
regulation of strikes as would prevent the unjust and 
foolish ones — especially those incited for mere leaders' 
graft, the unionists would be the first to agitate for 
the growing improvements in the law. 

The demagogues and corruptionists in the unions 
oppose arbitration agreements and all other means of 
avoiding strikes. On the other hand, nearly all the 
good and wise leaders, and there are many of them, 
do all they can to avoid strikes, as suicidal. Many 
honest but stupid men look upon the union as nothing 



264 



The Protection of Rights. 



[§ 264 a 



but a machine to strike with, while the fact is that 
some of the most successful unions, whose men actually 
receive far more than the average amount of wages, 
have seldom struck at all. Considering how the unions 
have lost wages and membership during the recent 
saturnalia of strikes, it is not unthinkable that unless 
the strikes disappear, the unions must. If they stick 
to their legitimate function — like that of the German 
army for the last thirty-five years — of powerful pro- 
moters of peace, letting all who would impose on the 
workingman know that they have not to deal with 
individuals, but with an army, not much imposition 
need be feared. They have rushed into their excesses 
because they had only individual employers and unpre- 
pared communities to impose upon. Now that the 
employers and the communities have begun to marshal 
their forces, the unions will soon find unjust aggression 
hopeless, but will receive all the more sympathy when 
their complaints are just. 



CHAPTER XXI. 



PERSONAL PROPERTY (CONTINUED). 

Schemes for Distributing it more Evenly (Continued). 

(IV) Labor and tlie Law. 

I will now attempt to give some idea of the general 
attitude of the law regarding labor conspiracy and 
coercion. 

Of the laws enacted by legislatures and 
and Civfc Law, Law pronounced by judges and by priests, such 
as work, are only statements of natural 
laws; and anybody trying to reform society by some 
fanciful scheme counter to natural law, will soon find 
himself in opposition to some law of the state rooted 
deep in human experience. The trade-unions are 
already in pronounced opposition to the laws of both 
Nature and the State, as is shown not only by individual 
violations of the law, but in the general attitude of 
the unions. To carry out their systems, they have 
found it necessary to exact from their members a 
pledge of fealty to the union superior to their fealty to 
church and state, to prohibit them from entering the 
militia which protects the established law, and to 
agitate for the abrogation of injunction, which is one 
of the most important features of the established law ; 
they have procured the enactment of many impossible 
statutes, which are of course falling to pieces under the 
scrutiny of the courts; and they frequently publicly 
admit that they hold themselves superior to . the law, 

265 



266 



The Protection of Rights. 



and that they cannot succeed without going beyond it. 
After President Roosevelt told the unionists at Chicago 
in 1905 that there would be no discrimination in favor 
of either side, the President of the Chicago Federation 
of Labor said: "The President deals a death-blow to 
organized labor" . . without discrimination, we are just 
where we started. What we have been fighting for is 
union labor to the exclusion of all others. " In other 
words, they had been fighting to override the laws pro- 
tecting the non-unionists' Right-to-Work, and every 
man's right to join the union or not at his free will. 
Their avowed and acted policy is that, if society will 
not see their most trivial demands granted, society 
shall suffer the most serious consequences. In short, 
just as the ignorant, seeking for shorter cuts to fortune 
than industry, frugality, inventiveness and the other 
effective sources of wealth, have lately tried, with con- 
spicuous failure, to set aside the natural laws which 
control land, money and industry, so they are now 
attacking not only the statute laws which they them- 
selves have approved, but the venerable system of Anglo- 
Saxon common law which has grown out of the experi- 
ence of the ages, and which is by many, and those proba- 
bly the wisest, regarded as the greatest achievement 
and most important possession of the human race. 
Probably existing laws are adequate to the situation, at 
least so far as the unions have not effected the repeal 
of the common law which has protected the liberties 
of English-speaking people since English was first 
spoken. Altho the common law has always been re- 
garded mainly as the defence of the poor against the 
rich, many people have been surprised to find in it equal 
elements of defence of the rich against the poor. An 
impression has become widespread that vox populi is 
not always vox dei, and that the voice of the trade- 
unionist is not always even the voice of the people.* 

* An instance instructive in many ways, not least regarding 
the frequent boomerang effect of legislation, is afforded in this 
connection. No portion of the community was more active 
than the trades-unions in the agitation which led to the Sher- 



§ 26s <*\ 



Personal Property. 



267 



However, conspiracies of laborers to obstruct and even 
to destroy the business of employers who would not , and 
often could not, concede to their demands, have grown 
so frequent that, like the violence of primitive com- 
munities, they have come to be regarded as justifiable; 
and American legislatures have even passed statutes 
admitting a right to strike. But the courts are taking 
different ground. 

265 (a). The Law The legality of a number of men doing 
of conspiracy. together what each may do separately, was 
treated by Justice Harlan, in the U. S. Supreme Court, 
Arthur vs. Oakes. He said: 

"An intent upon the part of a single person to injure the 
rights of others or of the public is not in itself a wrong of which 
the law will take cognizance, unless some injurious act be done 
in execution of the unlawful intent. But a combination of 
two or more persons with such an intent and under circum- 
stances that give them, when so combined, a power to do an 
injury they would not possess as individuals acting singly, has 
always been recognized as in itself wrongful and illegal. ' 

Nearer up to date, in 1906, the Pennsylvania court 
of first resort (whose judgment was confirmed by the 
higher court) in the Purvis Boycott case, said: 

**The defendants contend, however, that what they did in 
concert was simply what each might have done for himself, 
acting on his own initiative, and that their concerted action 
was not, therefore, unlawful. 

* ' I do not understand such to be the law of our state. There 



man Anti-Trust Act. This act makes criminal every com- 
bination in restraint of trade between the states. It was 
primarily aimed against abuses among the railroad companies 
and the great shippers. It has now been applied by the courts 
to boycotts and similar combinations interfering with the 
business of any establishment sending goods outside of its 
own state, and the mere notification of their criminality peace- 
fully resolved the teamsters' boycott against the Kellogg 
Switchboard Co. in Chicago, the freight-handlers' boycott against 
the meat-packers, and other boycotts in other places. The 
unions, dissatisfied with the laws they advocated for others, 
when applied to themselves, are now agitating for repeal. 



268 



The Protection of Rights. 



[§ 265 a 



is, under some circumstances, a potency in numbers of which 
the law takes notice. 4 Men often do [illegally] by the combina- 
tion of many, what severally no one could accomplish, and 
even what when done by one would be innocent. There is a 
potency in numbers when combined which the law cannot 
overlook when injurv is the consequence. . . " Morris Run 
Coal Company vs. Barclay, 68 Pa. 173. 

Then was quoted a previous decision, in Patterson vs. 
Building Trades Council, 11 Dist. Rep. 500: 

" 4 All the authorities of this state go to show that while the 
act of an individual may not be unlawful, yet the same act 
when committed by a combination of two or more, may be 
unlawful, and therefore actionable.' " 

The court went on: 

" The authorities above cited indicate clearly that the doctrine 
of Bohn Manufacturing Co. vs. Hollis, 54 Minn. 223 and 40 
A. S. R. 319, that 4 What one man may lawfully do singly, two 
or more may lawfully agree to do jointly', is not the doctrine 
of the law of our own state. Neither, indeed, does it seem to 
conform to elementary principles. The efforts of one, by rea- 
son of their very puniness, may be such that the law will take 
no notice of them: 4 de minimis lex non curat.' But when, with 
increasing numbers, the individual effort has grown into an 
avalanche of power, can it still be said that the law will not 
notice it because the individual contributions thereto are 
small ? With us the law takes notice of the cumulative power 
of increasing numbers." 

The same point was sustained by Judge Knowlton of 
Massachusetts when he said: 

" An act which can be done in legitimate competition by one, 
two or three persons, each proceeding independently, might 
take an entirely different character both in its nature and its 
purpose if done by hundreds in combination." 

Similar ground was taken regarding the whole ap- 
parently innocent class of rights which include stopping 
work at will; choosing one's shopmates; buying where 
one pleases ; peaceably arguing with another man regard- 
ing choice of places and times for working, buying and 
selling; etc., etc., when the United States Supreme 
Court said: 



§ 265 ^] Personal Property. 



269 



" No conduct has such an absolute privilege as to justify 
all possible schemes of which it may be a part. The most inno- 
cent and constitutionally protectee! of acts or omissions may be 
made a step in a criminal plot, and if it is a step in a plot, neither 
its innocence nor the Constitution is sufficient to prevent the 
punishment of the plot by law." 

The general principle was thus illustrated by Hon. 
Daniel Davenport, Counsel to the Anti-Boycott League, 
in an address before the Citizens' Industrial Association 
of America, in 1905: 

* 4 Suppose half a dozen men in my town are bakers ; I go to 
one of them. . . . He may say to me: 'You do not belong to 
my church, or you do not belong to any church. ... I do not 
want to sell you any bread unless you join the church.' He 
has a perfect right to do that. And so, if I go to each of the 
other five, every one of them has a right to say that he will 
refuse to sell to me ; but if those six men have combined together 
and agreed not to sell me bread, in order to make me do some- 
thing, for instance, to make me join the church, that is a con- 
spiracy, and every act they do to carry out that conspiracy is 
unlawful, by reason of the fact of its being a step in the plot. 

4 'That principle has been laid down by the Supreme Court of 
the United States in a case that arose in the State of Wisconsin. 
It has been emphatically laid down by the courts of Illinois, and 
it has, within a few days, in cases that we have been connected 
with in the State of Massachusetts, been recognized and applied." 

Other decisions to the same general effect are too 
numerous and too various to recount. Occasionally 
some demagogic judge who cares more for Labor than 
for Law, or some petty magistrate who does not know 
the law, turns up with a decision in the opposite di- 
rection, but the weight of the law is now past question. 
The bearing of these decisions on the right to strike 
is obvious — that men have no right to attack another 
man's property or business because they once helped 
in it, and threw up their jobs because they ajid 
their employer could not agree; and that conspiracies 
to strike, picket and boycott are such attacks. 
265 (bi The A strike is questionable also on the second 

"Comer" again, ground that it is an artificial damming up 
of the supply of labor : so it is open to the same objec- 
tion with an artificial cornering of goods. 



2JO 



The Protection of Rights. 



[§2656 



For these considerations, the common law — the de- 
cisions of judges have not seldom been against there 
being any such thing as a right to strike. The Eng- 
lish courts, whose example has largely influenced 
ours, have held from time immemorial that it was 
criminal conspiracy for workmen to unite to raise 
wages and shorten hours, and Parliament has passed 
statutes to the same effect. These acts were repealed 
in 1824, and later there have been statutes declaring 
that no combined action could be criminal in a trade 
dispute unless it were criminal when committed by an 
individual. But there is a growing sense that this is 
going too far. As already shown, there are many de- 
cisions of courts, English as well as American, that acts 
which can work no injustice when performed by an 
individual, may work great injustice when performed 
by many men at once. 

265 (oh Malicious A long-established principle is that 
tnunt. strikes are criminal if undertaken with 

malicious intent. The range of malicious intent, how- 
ever, is not yet very thoroughly defined. It seems to 
have been sufficiently determined whether there is an 
element of malicious intent in holding up the transit 
of food or fuel of the whole community in order to 
secure some relatively minor convenience or concession 
for a few. 

265 Labor- In Massachusetts, strikes are illegal 
taoing machinery. w h e n directed against labor-saving ma- 
chinery. In 1895 tne Supreme Court issued an in- 
junction against the masons building the Harvard 
Medical School, stopping work because the contractors 
were using labor-saving machinery to form the arches. 
Labor-saving machinery is so clearly demanded by the 
greatest good of the greatest number, or "public policy 
that it is strange that this act of the judges should be 
regarded as something of a novelty. 
265 (e). no open Strikes are illegal when directed against 
* hop > the open shop. In the Chicago Typothetae 

Case, in 1905, the injunction prohibited "from attempt- 
ing to prevent by threats of injury or by threats of 



§26 S A] 



Personal Property. 



271 



calling strikes, any persons from accepting work from 
or doing work for such complainants." And there are 
hosts of decisions to the same effect. 
265 (f). "immtdt- Many of the judges who admit the right 
til wm£thet™ d to strike, limit it by an important pro- 
*^'*«. vision — that legally to conspire to strike, a 

man must have an "immediate interest" in the object 
struck for. It is widely held that a man has enough 
immediate interest in increased wages or decreased 
hours to justify his conspiring to strike for them, but 
it is also widely held that in a strike to compel the dis- 
charge of a non-union man, or the reinstatement of a 
union man, the strikers have no such " immediate in- 
terest" as to prevent the strike being an illegal con- 
spiracy. For the same reasons, sympathetic strikes are 
now quite generally held to be illegal conspiracies, a 
man having no such "interest" in another establish- 
ment or another trade working beside him — on a build- 
ing for instance, not to speak of a trade in another 
part of the country, as to justify his striking because 
the others have struck. 

265 (g). Prof. The following additional causes enumer- 
Adams' summary. a ^ e( j Professor Adams render strikers 
liable to criminal indictment: 

" Hindrance and delay of the United States mail, persuasion 
of others to obstruct the mails or interstate commerce generally, 
inducement or coercion of one person to boycott another, the 
coercion of the public generally to adopt certain measures, and 
probably the violation of labor contracts. It need hardly be 
said that in most of these cases the combiners hope to benefit 
themselves ultimately. But if, in the chain of intermediate 
means, there is an illegal act such as intimidation of a 'scab', or 
if the ultimate benefit is remote, trivial or indefinite, while 
the injury is the immediate object sought, the combination 
becomes illegal." 

265 (f>). Collet- A recent injunction against a strike 
tng taws. on the Wabash road was dissolved because 

it did not appear that the intending strikers contem- 
plated an "illegal act". If tying up a railroad is not 
yet an illegal act, the tendency of the law shows that 



272 



The Protection of Rights. 



[§ 265 h 



people are becoming awake to their rights at a rate 
that will soon make it one. 

Yet despite these decisions of the courts, Pennsyl- 
vania has a statute justifying any strike whatever that 
union rules may sanction Consequently nothing that a 
trade-union sanctions can be an "illegal act"! But 
the Supreme Court of the state takes a different view. 
On March 19, 1906, in the Purvis case before referred 
to, it said: 

4 4 In attempting to justify their conduct the appellants allege 
authority for it in the act of June 16, 1891, P. L. 300. While 
that act provides that they may devise and adopt ways and 
means to make rules, regulations, by-laws, and resolutions of 
their order effective, it sanctions no rules, regulations, by-laws 
or resolutions to commit wrong, and if it attempted to do so 
by authorizing the appellants to interfere with the absolute rights 
of the appellees, the legislation would be a dead letter, for the 
legislature cannot abolish the Declaration of Rights." 

And on the other hand, Illinois has a statute as fol- 
lows: 

' 'Sec. 158. If any two or more persons shall combine for the 
purpose of depriving the owner or possessor of property of its 
lawful use and management or of preventing by threats, sug- 
gestions of danger or any unlawful means, any person from 
being employed by or obtaining employment from any such 
owner or possessor of property, on such terms as the parties 
concerned may agree upon, such person so offending shall be 
fined not exceeding $500, or confined in the county jail not ex- 
ceeding six months. 

"Sec. 159. If any person shall, by threat, intimidation or 
unlawful interference, seek to prevent any other person from 
working or obtaining work at any lawful business on any terms 
he may see fit, such person so offending shall be fined not 
exceeding $200." 

But either way, as already intimated, legislative acts 
are apt to become dead letters, because they are much 
influenced by ignorant clamor; the body of the com- 
mon law which has grown up from the decisions of 
trained judges, has a tendency to put the right of 
striking with the right of revolution — counter to law, 
justifiable only in the absence of other remedies for 



§266] 



Personal Property. 



273 



unbearable ill — a right to be handled, not recklessly, 
as is the present fashion, but only in the gravest need, 
and to be tested only by results. 

265 ra Duty of Under this view, whether, in any special 
district attorneys. case> a strike should be justified as a revo- 
lution, should depend on public opinion, as represented 
by a jury. There need be no fear that any jury will 
favor capital as against labor, and there can be little 
doubt that in the absence of conflicting statutes, when- 
ever it shall appear that any public utility is paralyzed 
by a conspiracy, it is a district attorney's duty, however 
much it has been neglected, to investigate the con- 
spiracy, and if he feels warranted, to propose the indict- 
ment of the conspirators. While, as already said, public 
opinion could be depended upon for all reasonable 
leniency, no one who has seen, for instance, many thou- 
sands of the population of New York City deprived of 
their usual means of reaching business and returning 
home, by the conspiracy of a much smaller number of 
railroad employees, can have much doubt of what pub- 
lic opinion in such a case will eventually be. The rights 
of the public are not going to be left forever under the 
dictation of labor leaders, or even of trade-union con- 
ferences, and there cannot be many years before public 
opinion will demand statutes perhaps like those 01 Aus- 
tralasia (278 a. ft.), to protect public rights against them. 

So much for the general attitude of the law regarding 
strikes. 

266. The work- As to the specific end of coercing men 
man's freedom. j n t unions, the attempt to make all men 
in a trade join the union was declared in 1905 by Chief 
Justice Knowlton of Massachusetts to be against pub- 
lic policy, because it was an attempt to create a monopoly 
of labor in that branch. Many other judges have held 
the same. 

In the same decision, Judge Knowlton allowed dam- 
ages against a trade-union officer for forcing an em- 
ployer to discharge a non-union man. 

In New York a statute prohibiting an employer from 



274 



The Protection of Rights. 



[§ 266 



making non-membership of a union a condition of em- 
ployment, has been declared unconstitutional. But on 
the other hand, Professor Seager* says: 

"The Court of Appeals of New York State, in branding as a 
conspiracy the effort of a union to secure the discharge of a 
non-union man, used the following language: 'Public policy 
and the interests of society favor the utmost freedom in the 
citizen to pursue his lawful trade or calling, and if the purpose 
of an organization or combination of workingmen be to namper 
or restrict that freedom, and through contracts or arrangements 
with employers to coerce other workingmen to become members 
of the organization and to come under its rules and conditions, 
under the penalty of loss of their position and of deprivation 
of employment, then that purpose seems clearly unlawful and 
militates against the spirit of our Government and the nature 
of its institutions 't But a few years later % the same court, 
looking at the same question more from the point of view of 
labor unions, decided that a strike for a similar purpose was 
lawful, on the ground that the object sought was not the injury 
of the non-union employee, but the preservation of the union. 
So long as there seemed to be no malice in the action, and 
violence and intimidation were not resorted to, it was held 
that the incidental injury to the non-unionist could not render 
it a conspiracy. 

"This reversal of opinion illustrates fairly well the difficulties 
which American courts encounter in their efforts to apply the 
common law of conspiracy to labor cases, and 
267. The law chaotic, explains why they arrive at such diverse con- 
clusions as are shown by the authoritative decisions of the 
courts of the different states. It would be a great gain if the 
whole question of the nature of conspiracy in connection with 
trade disputes could be settled by statute in the United States 
as it was in Great Britain by the Act of 1875." 

Uniformity could not be hoped for in state legisla- 
tion. But perhaps a model for state legislation could 

* This chapter is largely indebted to the chapter on the 
Legal Regulation of Labor in Professor Seager's " Introduction 
to Economics" and to Professor T. S. Adams's chapter on 
Labor Laws in "Labor Problems". With those two admi- 
rable and up-to-date works in hand, it would be worse than 
superfluous for the author of a brief summary like this, to ex- 
plore the entire ground again. For a fuller treatment, the 
reader is strongly advised to consult those works. 

t In Curran vs. Gallen, 152 N. Y. 33 (1897). 

% In National Protective Association vs. Cummings, 170 
N. Y. 315 (1902). 



§268] 



Personal Property. 



275 



be hoped for in a United States statute regarding a con- 
spiracy to interrupt commerce between the states. 

Truly, the law has as yet handled labor questions only 
in a very wobbly way. Professor Seager says else- 
where : 

"There is scarcely a regulation, from a simple restriction on 
the age at which children may be employed to the provision 
that men may work only eight hours a day in specified industries, 
that has not been declared unconstitutional in certain sections 
of the country, only to be upheld as a legitimate exercise of 
the police power in others." 

The vacillation and uncertainty of the law have been 
great in America, not only because of the fact that 
each of forty-odd states has its own set of laws, but 
by the decisions of an elective judiciary seeking the 
labor vote, and by statutes passed at Labor's demand. 
Yet the natural evolution of law is unquestionably toward 
the increased protection of the right to work by those 
who want to work. 

Slow as the law has been, it has now reached a secure 
and consistent position against the picket and the 
boycott. 

268. Picketing As to picketing, the courts, with prac- 
uniawfui. tical unanimity, are taking very decided 

ground that it is an unlawful invasion of private rights. 

The early injunctions against picketing were quite 
generally on the ground that the common law is against 
enticing away a servant or an employee, unless possi- 
bly to secure an advance or prevent a decline of wages. 
This of course would not permit picketing in a sympa- 
thetic strike or a closed-shop one, or one resulting from 
a discharge of hands. But later, very strong general 
ground has been taken against picketing as tending to 
disturb the peace. 

Judge McPherson, sitting in the United States Cir- 
cuit bench for the Southern District of Iowa, on the 
5th of July, 1905, said:* 

* From an address of Hon. T. J. Mahoney before the Citizens' 
Industrial Association of America, Chicago, November, 1905. 



276 



The Protection of Rights. 



[§ 268 



14 'There is and can be no such thing as peaceful picketing 
any more than there can be chaste vulgarity, or peaceful mob- 
bing, or lawful lynching. 

" ' A portion of this language was adopted and amplified in an 
opinion of the Appellate Court of Illinois, handed down on the 
3d of October, 1905, the court saying: 

144 "The picket system once established, the intimidation, 
assaults, slugging and bloodshed followed as naturally and 
inevitably as night follows day. There can be no such thing as 
peaceful, 'polite and gentlemanly' picketing any more than 
there can be chaste, 'polite and gentlemanly' vulgarity, or 
peaceful mobbing or lawful lynching. 

" 4 "It is idle to talk of picketing for lawful persuasive pur- 
poses. Men do not form picket lines for the purpose of con- 
versation and lawful persuasion. . . . Its use is a form of unlawful 
coercion." ' 

44 After Judge McPherson had filed the opinion referred to, 
the managers of the strike abandoned the use of the word 
'picketing and adopted that of 'reporting', the pretense being 
that their acts could possibly be justified by changing «the name, 
but the character of the work done by the 'reporters' was iden- 
tical with that formerly performed by the 'pickets'. . . . The 
system being the same under a different name, deserved and 
received from the court the' same condemnation that had previ- 
ously been visited upon picketing." 

One of the latest decisions comes from the United 
States District Court sitting at Milwaukee, and is thus 
reported in the New York Times: 

''Milwaukee, June 17," [1906]. — " In a sweeping injunction 
United States Judge J. V. Quarles forbade the iron-molders* 
unions and sixty-one individual members from in any way in- 
terfering with the business of the Allis-Chalmers Company. 

"The strikers are enjoined from impeding, hindering, obstruct- 
ing or interfering with any of the business of the company, and 
from entering the grounds or premises of the complainant 
against its wish. They are enjoined from compelling or attempt- 
ing to compel or induce by use of threats or intimidation of 
any sort, or by fraud or deception or violence, any person to 
leave the employment of the plaintiff company, and also from 
attempting to persuade the employes of the company to break 
their contracts and leave the employ of the plaintiff. 

"Judge Quarles further commands the striking molders to 
desist from congregating at or near the premises of the company 
with the purpose to intimidate or obstruct, surround or impede 
any of the employees of the plaintiff. The order further pro- 
vides that the defendants are not even to go to the homes of 



§ 269] 



Personal Property. 



277 



any of the employees for the purpose of persuading them into 
leaving the Allis-Chalmers Company. " 

Similarly, an injunction in the Connecticut Superior 
Court, June 27, 1906, restrains the union from "per- 
suading or cajoling" the complainant's employees to 
leave work. 

In the Typothetae case in Chicago in 1905, the court 
enjoined picketing not only at the factory, 

but " about or near /any place where their employees are lodged 
or boarded, for the purpose of compelling, inducing or soliciting 
the employees of any of said complainants to leave their ser- 
vice; . . . from attempting by bribery, payment or promise 
of money, offers of transportation or other rewards, to induce 
the employees of any of said complainants to leave their service." 

The early decisions against picketing have generally 
been not only against enticing the employee away, but 
also on the ground that it engenders violence. The 
later ones evidently consider the fact that it is an 
unjustifiable conspiracy against the right to carry on 
business. 

As to the liability of unions and their 
bHlty fo?damages. .members, for damages in strikes and boy- - 
cotts : in the last quarter of the nineteenth 
century, while the English law took the direction of 
tolerance toward strikes, it took a counter-direction 
regarding the liability of trade-union funds for dam- 
ages inflicted in consequence of union action. It had 
been held that as the unions were not corporate 
bodies they were beyond the reach of suits, and that 
their members could only be reached as individuals. 
The drift of opinion counter to this position became 
decisive in i9oi,when the House of Lords held in the 
celebrated TafT-Vale case that the unions' funds were 
liable, and as there is no limited liability without in- 
corporation (154 a), this decision would probably make 
each member liable for the total amount of any damages 
that might be granted against a union. The damages in 
this case were ^ 23,000. The English unions are now 



278 



The Protection of Rights. 



trying hard to have the effect of the decision annulled 
by statute — one of the typical unionists' attacks on 
the law. 

In the United States there are already several de- 
cisions in the same direction: for example, the funds 
of the Waterbury, Conn., unions were attached for 
damages resulting from violence in the street-railway 
strike of 1903, the houses of the Danbury boycotters 
are under attachment, and so are the bank accounts of 
the men in Rutland, Vt., who interfered with their 
employers getting help in 1903. 

For stopping work, by master or man, to the unrea- 
sonable detriment of others, it is very probable that 
the law will soon clearly see the reasonableness of 
damages: inasmuch as for leading others to stop work, 
damages have already been granted. 

There is an important consideration which I cannot 
express better than I have already done in an earlier 
work,* which I will therefore venture to quote again: 

Damages under such circumstances could generally 
be collected from only one side — if the capitalist is 
in the wrong, the laborer has an easy remedy; if the 
laborer is in the wrong, the capitalist has virtually 
none. This is one reason why employers do not always 
contract with their employees for a reasonable notice 
from either side before severing their relations. And 
at best, the law is a slow and imperfect remedy, tho 
the best we have. Not the least of the advantages that 
would come to society from an increased proportion of 
property-holders, would be increased faithfulness to 
contracts, from fear of damages. This being absent, 
269 (a) wade- nowever » m order to put the two sides on an 
meanor'as a equality in contracting, the violation of a 
substitute. labor-contract might be made a misde- 
meanor subject to imprisonment. Such a law would guard 
the poor man against the rich man more effectively 
than a money penalty, which the rich man could afford 
to disregard; and it would guard the rich man against 



* Op. cit. 



§ 270] 



Personal Property. 



279 



the poor man, by the only penalty which could be en- 
forced. Such a law would have the merit that under 
it, juries could be depended upon to treat the poor 
man at least as justly as the rich. This point deserves 
the careful consideration of all who feel an interest 
in the improvement of the law. 

270. Some sum- The Alabama statute prescribes as un- 
made* °f the ,aw « lawful the following acts : 

"A conspiracy between two or more persons to prevent any 
person, firm or corporation from carrying on any lawful busi- 
ness within the state, or for the purpose of interfering with 
the same. 

" The loitering of one or more persons about a place of busi- 
ness for the purpose of inducing others not to buy from, sell to 
or have business dealings with a person, firm or corporation, or 
to picket any works or place of business for the purpose of 
interfering with its business. 

"The printing or circulation of 'any notice of boycott, boy- 
cott cards, stickers, dodgers or unfair lists, publishing or 
declaring that a boycott or ban exists, or has existed, or is 
contemplated', or publishing the name of any public official or 
judicial officer upon any blacklist, unfair list or other similar 
list because of any lawful act or decision of such official. 

" The use of force, threats or other means of intimidation 
to prevent any person from engaging in any lawful occupation. 

" For any person, firm or corporation to maintain a blacklist 
or to notify any other firm or corporation of the names thereon 
to prevent the person so named from receiving employment ** 

Vice-Chancellor Pitney of New Jersey summed up 
the law in 1903: 

" First — That all sorts of laborers may lawfully combine and 
form unions for their mutual benefit, and that they may use all 
lawful means to promote their own interests, being careful in 
so doing not to infringe on the rights of others. 

" Second— One lawful means to that end is the refusal to 
work on terms offered by the employer. 

" Third — An unlawful means is to hinder or prevent others 
from working for an employer under such terms as they shall 
see fit. 

" Fourth — One means of such hindering and preventing is in 
various ways to render it either difficult or uncomfortable for 
such willing workmen so to work. This is an unlawful means. 

" Fifth — Another unlawful means in common use to hinder 
or prevent willing employees from working, and to compel 



28o 



The Protection of Rights. 



[§270 



employers to accede to terms which they would not other- 
wise adopt, is the boycott in its various forms." 

271 Iniunctionf. Injunctions have been issued against 
njunc ons. a^og^ every form of boycott palpable 
enough to recognize, and damages have been awarded 
in several cases. 

The Anti-Boycott law in Wisconsin was enforced 
in so comparatively inoffensive a matter as two news- 
papers refusing to print advertisements from the 
patrons of a third which had raised its rates higher 
than theirs, unless at the same rates. As bearing on 
such innocent acts as stopping buying and stopping 
working, which are at the root of strikes and boycotts, 
Mr. Mahoney said in the address already quoted from, 
that the courts 

4 no longer hesitate to grant injunctions which shall not only 
prevent the perpetration of assaults and the destruction of 
property, but shall equally protect the peace of mind of willing 
employees, and give security from injuries and interference with 
the rights of employers to carry on their business. . . . The 
courts are equally in accord in exercising the necessary right 
to punish for contempt those who insist upon violating the 
injunctive orders. There was a time in the not very remote 
past when much outcry was raised against trials for contempt 
being conducted by the court instead of by a jury, but . . . the 
spectacle was all too frequent, of a jury acquitting men whose 
guilt was more than abundantly established. ' 

But this does not warrant agitation for doing away 
with injunctions, but only for doing away with the 
judge's power to punish under them without a jury. 
A bill for the purpose is now before Congress. That, 
however, is not what "Labor" wants: it wants its own 
sweet will free from the interference of either judge or 
jury. 

Yet even where the injunctions have not held, they 
have been of value in giving both sides time to stop 
and think. But the unions have got so much in the 
habit of forcing their own way, regardless of all law, 
that, altho they are constantly seeking injunctions 
against their employers, they are very bitter toward 



Personal Property. 



281 



injunctions when issued against themselves, and have 
sought to have statutes against granting any injunctions 
at all in labor disputes. This has a show of fairness 
because it would appear to apply equally to both sides. 
But the show is specious (altho it seems to have deceived 
the President of the United States while the proofs of 
this book were being read) : because the employers are 
in a small minority and hardly ever resort to violence. 
Granting the short-sighted view of the unions that any 
lasting good can come from violence, they can well 
afford to endure the little violence the other side is apt 
to attempt, if they can have free swing for their own 
habitual lawlessness. On this subject of injunctions I 
again resort to some earlier expressions.* 

There is one form of anarchism so specious that it 
has deceived many good men. It proposes to do away 
with government, by doing away with a little at a time; 
and its present object of attack is what it is pleased to 
call 'government by injunction'. Now injunction takes 
the place, in government, of the ounce of preventive. 
It is better to prevent lawlessness than to punish it. 
Injunction is merely the exercise by a judge, of the 
authority to prohibit an act, not necessarily itself pun- 
ishable at law, which he believes likely to lead to acts 
which are punishable at law, and no sane man can 
doubt that the proper exercise of this authority effects 
a great saving of public peace and safety. The injunc- 
tion has been abused, as has every feature of the law: 
judges are but human, but no sane man claims that 
that fact should do away with the law. Those who 
object to injunctions are (many of them without know- 
ing it) in precisely the same condition as if they objected 
to the punishment of the actions which injunctions are 
issued to guard against, while a large majority of those 
who object to injunctions, object simply because injunc- 
tions prevent their having their own way; and they 
object on the same grounds on which they object to 
the police and militia as well as to the courts — it is 



*Op. cit. 



282 



The Protection of Rights. 



[§ 271 



simply the objection to all authority — it is the spirit of 
anarchy. 

The assumption by Labor that of right it owns every- 
thing, can alone account for some of its claims. The 
most extreme of them, perhaps, is illustrated in the 
bill advocated by Mr. Gompers, the president of the 
American Federation of Labor, which would prevent 
United States courts from issuing injunctions in any 
contention between employers and their men, unless 
to guard some property or right against damage that 
could not be made good, and then (here is the extreme 
claim) the bill goes on to provide that "for the pur- 
poses of this act, no right to carry on business of any 
particular kind at any particular place, or at all, shall 
be considered or treated as property, or as constituting 
a property right." 

This of course is an almost laughably disguised 
scheme to obtain from legislation a right to destroy 
such property at will, through the picket and boycott, 
which the courts have abundantly declared counter 
to American liberty. The two million labor-unionists 
are simply claiming absolute control over the rest of the 
American people. 

At the meeting of the National Civic Federation in 
December, 1906, the counsel for the American Federa- 
tion of Labor argued that the laborer's right in his 
labor is just the same thing as an employer's 4 4 right 
to carry on business of any particular kind at any 
particular place, or at all". He challenged discussion 
of the point, and said that he had always found dis- 
cussion of it evaded. The claim seems to me very 
much like a claim that because a man's body is made 
up of cells, a cell is the same thing as a man. In +his 
connection, however, the fallacy lies in the fact that 
no laborer ever yet sought the protection of a court 
for his property in his Right to Work, unless it was 
for protection from the very men against whom the 
employer too seeks protection for his Right to Work — 
his right to carry on his business. Therefore the very 
identity in the two properties, be it real or fanciful, 



§ 272 a] 



Personal Property. 



283 



which the Federation of Labor claims, is an argument 
in favor of the very court protection of both which 
the Federation seeks to paralyze in the case of the 
employer's right — a very pretty example, it seems to 
me, of the reasoning on which* all labor coercion is 
based. There is probably no more remarkable instance 
of the madness which can be produced by a brief period 
of successful aggression before the aggrieved have time 
to organize for defence. The counter-organization has 
begun, however, and the madness seems to have reached 
the pitch where it indicates the intention of the gods 
to destroy. But if this could mean the permanent 
destruction of labor organizations, it would be deplorable. 
Yet the present organizations will be destroyed if they 
cannot be reformed. There will be better ones in 
either event, and it is not yet proved that they must be 
new ones. 



272. Regulation , J*?* 11 * n ™ ^ l ™> ^ la *™ of 
of wages hours labor s attempts at coercion, let us devote 
and conditions. a WQrd tQ its general attitude regarding 

the regulation of wages, hours and conditions. 

Professor Adams, who certainly will not be accused 
of unfavorably representing Labor's side, says: * 

272(a). The labor " In the United States . . . the history of 
trust again, labor legislation is one long tortuous record of 

special protection to the working classes, secured by subtle 
limitation and frank disregard of the doctrines of free contract, 
and by class legislation. . . . Labor organizations are specifically 
exempted in a number of states from the operation 01 the anti- 
trust acts (altho such exemption has been held to annul the 
whole law) ; and in their practical execution the anti-trust laws 
have been directed against combinations of employers in re- 
straint of trade rather than against the combination of employees 
which are equally in restraint of trade." 

Of Labor laws in the United States, Professor Seagerf 
says: 

" There are both state and national laws that directly further 
the monopolistic ambitions of trade-unions. The state of Penn- 

♦ Op. cit. t Op. cit. 



284 



The Protection of Rights. 



[§ 272 a 



sylvania has a law requiring men who wish to become master 
miners to work as helpers for a certain period and to pass 
then a state examination. New York state has similar laws 
in reference to plumbers and horseshoers. The [alleged] pur- 
pose of such statutes is of course to insure a certain degree 
of proficiency on the part of workmen who perform these 
important services, but that they assist trade-unions in their 
efforts to control the supply of labor in their trades is beyond 
question. A Federal law which operates in the same direction 
is that prohibiting the entrance into the country of workmen 
under contract of employment. It might appear on general 
principles that the immigrant whose reputation at home was 
such that he could secure a contract of employment from an 
employer in this country, would be a better citizen than the 
immigrant who was attracted only by the vague hope of better- 
ing his condition, but this view disregards the special interest 
of those with whom the newcomer would compete for employ- 
ment. . . . He enters the country as a non-unionist, or 'scab'. 
. . . The law which prevents such resort to the foreign labor 



Of course such utterly irrational laws cannot stand, 
and never would have been passed if the community in 
general were as well organized (as it is rapidly becoming) 
against favoritism in legislation, as the unions are or- 
ganized for securing it; or even if capital were not so 
engrossed in securing special privileges from legislation, 
that it seldom spares attention to general legislation 
affecting its general rights, but is content to rest upon 
its power to take care of them when exigencies arise. 

Professor Seager farther says : 

212(b). Protecting "The Supreme Court of Colorado declared 



against himself. men employed in the mining and smelting 
industries on the ground that if such a law was calculated 
to protect the health or morals of anybody, it could only 
be of the very man whose work was restricted, and that 
the legislature had no right to restrict freedom of contract for 
the benefit only of the persons whose libcrtv was thus limited; 
and yet the Supreme Court of the United States had declared 
in upholding the constitutionality of an identical statute pre- 
viously passed by the state of Utah, that the legislature bad 
the right to protect an individual even 'against himself, on 
the ground that ' the state still retains an interest in his welfare 




the laborer 



unconstitutional 




§ 272 c] Personal Property. 285 

no matter how reckless he may be', and that when 'the individual 
health, safety and welfare are sacrificed or neglected the state 
must suffer'. M 

Following out the idea of "protecting the laborer 
against himself Professor Seager turns to another 
decision of the United States Supreme Court, which 

" affirms the propriety of labor laws on the general ground that 
employers and employees are unequal in bargaining power. 
'The former naturally desire to obtain as much labor as pos- 
sible from their employees, while the latter are often induced 
by fear of discharge to conform to regulations which their 
judgment, fairly exercised, would pronounce to be detrimental 
to their health and strength. In other words, the proprietors 
lay down the rules, and the laborers are practically constrained 
to obey them. In such cases self-interest is often an unsafe 
guide, and the legislature may properly interpose its authority.' 
Finally, it affirms the principle already quoted, that in the 
exercise of its police power the legislature has the right to 
protect a man even against himself " 

This principle may be regarded as established law. 
New York goes so far as to "protect a man against 
himself" by punishing attempts at suicide — which, 
paradoxically, puts a premium on the success of the 
very act it prohibits. There is a point at which this 
doctrine would involve the most enervating paternal- 
ism — a point at which the individual must take the 
consequences of his own acts. On this point Professor 
Seager says : 

41 In Great Britain and the United States the notion that the 
legislative power should not be used to regulate hours and 
conditions of employment has been abandoned by most thought- 
ful persons, but the prejudice against any interference with 
wages, like that practiced in New Zealand and other Australian 
states, remains nearly as strong as ever. There is, of course, 
good ground for this distinction. Hours and other conditions 
272 (c). Wages of employment affect directly the health and 
unlike conditions, vigor of the working classes, wages only indi- 
rectly. Moreover, workmen are less mindful of their own inter- 
ests in connection with hours and sanitary arrangements than 
in connection with wages. Making all allowance for these 
considerations, many thoughtful persons still believe that, 
under certain circumstances, notably those found in connection 
with the sweating system, the regulation of wages must also 



286 



The Protection of Rights. 



[§272*: 



t>e undertaken by the government if serious evils are to be 
corrected. It is sometimes argued that the law cannot fix the 
rate of wages, but this is contrary both to reason and experience. 
The law cannot fix both wages and the number of persons who 
shall be employed at those wages, but it can declare that no 
one shall be employed in given trades unless paid certain 
minimum wages, and enforce its decree." 

272 (d). The lining And here fpllows an admirable utterance 
wa 9*- regarding "the minimum wage", which 

should not be confused with that favorite topic of the 
sentimentalists "the living wage". A great deal has 
been written to the effect that it is an employer's 
duty to give an employee enough to live upon decently, 
whether the employee earns it or not. But this sick- 
ening absurdity should not prevent the reasoning stu- 
dent from giving attention to the following considera- 
tions. 

41 The result may be an addition to the number of dependents 
who are 'unemployable' at the wages fixed because too ineffi- 
cient to earn them, but it may be better and cheaper for society 
to support such persons in almshouses than to permit their 
competition to hold the wages of great sections of the popula- 
tion down to a starvation level. In order to mark off the 
dependent from other classes the state may find it necessary 
itself to fix a standard by which the ability of the individual 
for independent self-support may be determined. Without 
desiring to advocate the establishment by law of standard or 
minimum rates of wages for the sweating trades, the author 
wishes to insist that this policy merits the same unprejudiced 
consideration as is now accorded by intelligent people to pro- 
posals for restricting the employment of children or women, or 
for requiring the use of safety appliances in connection with 
dangerous trades." 

212(e), Toomucn ^ » h * rd to tell just how far the law 
care enervating should take care of a person, and how far 

and against liberty. he bfi left tQ take ^ q£ himself ^ 

Certainly in countries where the government is very 
paternal, the mass of the people are apt to be very 
childish. And yet it is generally agreed that the law 
should prevent cruelty to children and even to animals — 
that it should limit the hours and sanitary conditions 
under which children and women, and sometimes even 



§ 272 e] 



Personal Property. 



287 



men work; and as already illustrated, many claim that 
it should even protect a man against himself if he 
seeks to do excessive and dangerous things. But this 
can be carried to the extent of infringing upon liberty. 
This danger in protecting him from other dangers, some- 
times leads to strange results. For instance: acci- 
dents from ill-guarded machinery and from laborers 
working when too exhausted to be cautious, annually 
destroy more than twice as many lives in the state of 
New York alone, as were destroyed on our side in the 
Spanish war, not to speak of the larger number maimed 
and crippled. These accidents are more frequent in 
the last weary hour of work than during the rest of 
the day. Yet there are laws requiring machinery to 
be protected, and against the working of men — espe- 
cially on railroads — longer than their attention can 
endure. But when suits for damages have been brought 
under these laws, the courts have sometimes declared 
them unconstitutional, as depriving a man of the liberty 
to work when and where he pleases, while the facts 
were that his "liberty" was only Hobson's choice — 
working as ordered, or throwing up his job. It seems 
as if such statutes ought to be penal as against the 
employer: then the " liberty" of the laborer would not 
be reduced to the miserable alternative of running the 
risk which the employer should obviate, or temporarily 
abandoning the means of supporting himself and his 
family. 

It may be remarked in passing, that, on the other 
hand, employers are frequently subjected to injustice 
in connection with accidents. Juries often mulct them 
for injuries to employees which are the fault not of the 
employers, but of other employees. 

Just as this goes to press, word comes of an interesting 
and suggestive decision to the effect that in a "closed 
shop" the laborer loses his right of action against 
his employer for damages resulting from the fault of a 
fellow workman, because the employer has not been 
un trammeled in his choice of workmen, and of course 
as the workman in the closed shop is inevitably a mem- 



288 - 



Tlie Protection of Rights. 



[§ 272 e 



ber of the union which has circumscribed the employer's 
choice, he shares the responsibility for the shop being 
closed, and cannot "come into court with clean hands", 
a requisite which equity demands. 

Statutes protecting the community from diseases bred 
in tenements and sweat-shops have often been set aside 
on grounds similar to those stated above — that it is part 
of a man's "liberty" to work where he pleases. It 
is a very difficult question how far the state has a right 
to interfere with the liberty of the individual — his 
liberty as a child to stay away from school, as child 
or man to break down his health by overwork, to expose 
himself to dangerous chemicals and machinery, to buy 
(or sell) dangerous medicines and intoxicants, and to 
get drunk and beat his wife. 

272 (f). Extremes This question has arrayed some of the 
and the medium. b est m { n fe against each other. At the 
extremes of opposition are the anarchist, against the 
state's having any rights at all; and the ultramontane 
who would have the state, as merged with the church, 
regulate the minutest functions of the individual con- 
science. Probably the safe and reasonable limit lies 
at the state's right of self-defence. The whole com- 
munity suffers from anybody's ignorance, ill health, 
mutilation, drunkenness, brutality; and has a right 
to guard against any such conditions becoming suffi- 
ciently widespread — directly, or by way of influence 
on popular conscience and sensibilities, as to cost the 
state more than it would cost to keep the evil within 
bounds. What shall be done against any particular 
self -inflicted evil, is of course for legislators to deter- 
mine, but their first inquiry should be, not how great 
an evil it may be to any particular man: for that is 
his own business; but how great an evil is it apt to 
be to men in general : and that alone is their business. 



CHAPTER XXII. 



PERSONAL PROPERTY (CONTINUED). 

Schemes for Distributing it more Evenly (Continued). 
(V) Remedies on Trial. 

273. Industrial There can be no reasonable doubt that 
war'and industrial all the decisions alluded to in the preceding 

chapter, and many more, are steps in a 
process by which industrial war is to be replaced by 
industrial law, just as, in civilized nations, private 
war has been replaced by private law, and interna- 
tional war is being replaced by international law. In 
addition, however, to the evolutionary steps so far 
indicated, some revolutionary experiments are under 
way. 

274. Legal experl- Three legal remedies for conflicts over 
ments in distribution, from which much is hoped, 
Australasia. are now ac t ua iiy on ^al j n Australasia, 

and only in Australasia. They are (I) state competition 
with monopolies, (II) the fixing of a Minimum Wage, 
and (III) Compulsory Arbitration. 

Australasia being so remote, specially illustrates 
the universal unreliability of testimony on controverted 
subjects. Sentimentality and the equally unreason- 
ing antagonism which it tends to arouse in the prac- 
tically disposed, seem to make it almost impossible 
for observers of social experiments even to see cor- 
rectly, not to speak of reporting correctly. The latest 
writer on Australasia, Dr. Victor S. Clark,* is conspicu- 

* "The Labor Movement in Australasia." 

289 



290 



The Protection of Rights. 



[§274 



ous by the degree to which he has risen superior to 
these influences. He finds both good and evil in the 
minimum-wage commissions and arbitration courts, 
but does not find that either or both of them have 
introduced the millennium. 

The interest as well as the importance of the subject 
justifies a special chapter, whose material I have, with 
the author's kind sanction, largely drawn from Dr. 
Clark's work. 

These experiments being as yet (1907) 
MnJtobedll'coJirt- restricted to Australasia, have worked only 
co/d°ttio™ r,can * n an exceptionally homogeneous com- 
munity, in which British stock with its 
broad-minded love of fair play largely predominates. 
Among the original convicts, many were high-minded 
persons transported for purely political offences; and 
much of the later colonization has consisted of large 
religious organizations possessing capital, character 
and culture. The amount of convict stock to-day is 
not worth considering. 
Dr. Clark says : 

"The consciousness of national Idnshlp ... is greater than 
in America, and for this reason communal sympathies are more 
active. . . . Production is confined largely to raw materials 
which are exported, and consumption is supplied by manu- 
factured goods made in other countries." 

[The inference that wages raised by legislation will 
not greatly affect prices of articles bought by the 
voters, seems contradicted later.] 

"The government, in supplying transport service for the 
inflow and outflow of these commodities, has become the 
largest employer in the colonies. . . . The custom of appealing 
to the government to decide industrial disputes to which it is 
a party, makes it easier to recur to the same authority to fix 
labor conditions in private employment. . . . Forty-seven per 
cent, of the people reside in cities of not less than four thousand 
inhabitants, as compared with thirty-seven per cent, in the 
United States. The average concentration of working popula- 
tion is therefore greater in those countries, and the labor 
element has better opportunities for organization. . . . The 



§ 275 a ] Personal Property. 



291 



difference in the wage of skilled and unskilled workers is much 
greater in our own country, where the common laborer is 
usually either a negro or a foreigner. This variation of wages 
in the United States, parallel with national and race lines, lessens 
solidarity of sentiment and class consciousness among work- 
men." 



Mr. Sidney Webb has said: 

"Australian politics and Australian governments are very 
far from perfect, but their faults and their virtues are utterly 
unlike the faults and virtues of America." 



For all these reasons, how the Australasian experi- 
ments would work among the mixed population of the 
United States, or especially among the almost entirely 
foreign population of some regions — and those gen- 
erally the most troublesome regions — and how, more- 
over, they would work under our almost exclusively 
private control of industries, Australasian experience 
gives little indication. 

275. State compe- The °f tn ^ se remedies on trial — 
tltlon with monopo- state competition with monopolies, may 
,lc,> be dismissed with a few words. Dr. 

Clark devotes to it but a sentence, tho one enthusiast 
who has discovered in it a panacea, devotes an article 
in a recent periodical.* The simple facts are that 
before there were any monopolies thought of, various 
Australasian communities, for the sake of aiding immi- 
gration and land development, started most of the va- 
rious industries which will be described later. The 

government's credit being better than 
?ng eS^uu. t9nd ' ^hat °* individuals, and it wishing to aid 

in opening up the new lands, it borrowed 
money to lend to farmers. This of course brought 
the rate of interest down, and may be considered to 
have been competition with monopoly of capital, if 
such a thing could exist. Of course the indirect effect 
of other government enterprises has been similar, and 



* Everybody's, September, 1906. 



392 



Tlve Protection of Rights. 



[§ 275 b 



275(b). in some it may be possible that the Australasians 
industries. have saved more in keeping prices down, 
than they have spent in taxes to pay deficits on gov- 
ernment industries. It is even supposable that in any 
community where there is enough political virtue to 
conduct government enterprises honestly, it may be 
worth while to pay the deficits apt to result from their 
inevitable inefficiency as compared with private enter- 
prises, for the sake of guarding against monopolies. 
It is even supposable that Australasia, with her homo- 
geneous British stock, her comparative freedom from 
the demoralizing glitter of superfluous wealth, and 
her other exceptional conditions, may possess the 
degree of political virtue needed to curb monopoly 
by government competition. But nothing has yet 
been done for the mere sake of that result ; and should 
its slight indirect accomplishment so far, encourage 
to successful direct efforts, their success could prove 
nothing for a community like ours, overwhelmed with 
debased immigration, and corrupted by the spectacu- 
lar temptations of misplaced superfluous wealth. 

Z76. The Minimum As to the minimum wage, already men- 
wage. tioned (in 272 d, which the student is 

advised to re-read in this connection), in Australasia, 
the idea has been worked out, according to Dr. Clark, 
as follows: 

1 4 The problems presented by sweating and Chinese compe- 
tition were so complex and required so much detailed regula- 
tion that the direct intervention of Parliament was likely to 
prove cumbersome and ineffective. Therefore authority to 
deal with these questions was delegated to subordinate bodies, 
called minimum-wage boards . . . and composed of men 
having practical knowledge of the industry under their juris- 
diction. . . . Their functions do not exceed in principle those 
exercised by railway commissions in America — with the impor- 
tant reservation that they affect private as well as public and 
quasi-public industries. The Victorian Parliament . . . gave 
the boards authority to prescribe a minimum wage for em- 
ployees in certain classes of establishments. This authority 
was granted in order to remedy a special evil — a wage so low 
276 (a). Against that it threatened the common interest of 
sweating. society in maintaining a standard of living 



§ 2j6d] 



Personal Property. 



293 



among all classes sufficient for healthy social progress. . . . The 
average profits of manufacturers are no higher when sweating 
is rampant, than when a fair wage is paid. . . . The better 
276 (b). Sought by employers rather courted some provision that 
good employers. freed them from the competition of less scrupu- 
lous men of their own class. Moreover, tho the determina- 
tions of wage boards are legislative acts, in essence amendments 
to the factory law, they preserve in some degree the form of 
a voluntary agreement. The boards who pass them are com- 
276 (e). How posed of an equal number 01 delegates from the 
regulated employers and employees in the trade in question, 

under a non-partisan chairman, and their decisions arc fre- 
quently compromises, formally not unlike collective bargains 
made between trade-unions and employers. . . . They are 
required to ascertain as a question of fact the average wage 
paid by reputable employers, and are forbidden to fix a mini- 
mum higher than the average wage as thus determined. The 
boards are also allowed to fix special rates of pay for aged, 
infirm or slow workers. . . . Employers have applied for 
eleven of the thirty-eight boards established." 

The Arbitration Courts, to be described later, seem to 
be rapidly taking over the functions of the Minimum 
Wage Boards, with results not quite contemplated by 
the originators of either. 

276 (d). Not ' ' When the court prescribes a minimum equal 

always effective.' to or above the average wage previously paid, 
the employer may meet this change by two different policies. 
In order to keep his payroll down, he often lowers the pay of his 
more competent hands, to compensate himself for the higher 
rate he is obliged by law to give his poorer workers. ' ' [Or, second, 
New Zealand] "statistics indicate that in probably a third of 
the occupations regulated by the court, the maximum wage 
does not exceed the minimum fixed by the award. The greatest 
variation usually occurs in industries requiring the highest 
degree of skill. In such industries the employer, in order to 
maintain a gradation of wages among his workmen, usually 
discharges his less efficient employees. 

"Slow workers, who arc not a negligible clement in the in- 
dustrial army, then become a social problem. They form 
from ten to twenty per cent, of all workmen, and their distress 
is an evil greater than ordinary unemployment. Some manu- 
facturers in Victoria dismissed sixty or seventy hands as soon 
as the minimum wage went into effect in their business. The 
labor party proposes to remedy this evil by old-age pensions. To 
absorb her surplus labor, New Zealand has undertaken great 
public works, paid for from loans. Western Australia has until 



294 The Protection of Rights. [§ 2j6d 

recently possessed a growing field of employment In the newly 
discovered gold districts. New South Wales and Victoria have 
not enjoyed these exceptional conditions, and in the latter state 
especially, the problem of the slow worker has been serious." 

276 (e) Recru- Even something like the sweat-shop is 
deacence of the beginning to appear — not the healthful 
aweat-ehop. hand industry of earlier times : 

" Slow workers thrown out of employment by the minimum 
wage sometimes open shops in basements and attics, where 
they make goods which they peddle directly to retail dealers, 
or sell to factories at prices lower than the ordinary cost of 
manufacture. This has occurred in boot and harness trades, 
and to some extent in cigar-making. However, only a few 
industries lend themselves to this process of dispersion. No 
handworker can compete with the products of power machinery. 

" Testimony as to the influence of the boards upon sweating 
and Chinese competition varies. Both continue to exist in 
Melbourne. I have seen large bundles of clothing going out 
of factories, to be made up by contractors who were evading 
board determinations. Few, if any, strikes have occurred 
where wage determinations are in force. 

276 (fh Excep- "All the Australasian laws give the regulating 
tiona allowed. authority power to fix a lower rate of pay for 
slow, aged, and infirm workers; but this is not a sufficient 
remedy. Employers refuse to receive slow workers in their 
shops, because they slacken the pace of other workmen. More- 
over, the formalities required to securer slow-worker permits 
embarrass both employee and employer. 

" Therefore, state regulation of industry places a burden upon 
the weaker members of society." 

Apparently, then, one effect of state regulation of 
wages, even in its short experience, is just what the 
American trade-unions are working hardest against — 
it is concentrating industry and leaving the slow work- 
man in the lurch. 

276 (g). High And to the concentration of industry 

prices resulting, threatening to develop into the trust, to 
unemployment and to the sweat-shop, are added high 
prices which nullify a raised income to those who have 
it, and are a hardship to those who have not: 

"All regulations restricting the freedom of employers in con- 
ducting their business probably add to the cost of production. 



§ 276*] 



Personal Property. 



295 



. . . Therefore industrial regulation increases the cost of 
living. . . . The Secretary of Labor in New Zealand says that 
'It has helped to minimize any advance in the workers' wages'." 

276 (*>. Bolstering Already efforts are in progress to bolster 
up needed. U p a p Q ii C y from which so much was 
hoped, but which even now, in these important respects, 
seems a failure. Already loom up the usual artificial 
remedies to remedy a remedy. 

" The wage-earner is the direct beneficiary of the minimum 
wage; the farmer pays the increment to the cost of production 
resulting from laws and awards, directly to his own nands, and 
indirectly in a higher price for commodities. . . . The farmer 
cannot recoup himself by adding to the price of his produce, 
for that is determined in the London markets. . . . The farmers 
of New Zealand and Victoria, where the rural classes are rela- 
tively the most influential, have already organized an active 
campaign in opposition to the labor party. Likewise the fac- 
tory operative whose manufactures are exported, or meet the 
competition of imported articles, cannot employ an arbitration 
law to raise his nominal wa^es without lessening employment 
and defeating his own end of social betterment. But he, like 
the farmer, must pay the increased price for local services and 
products which stich a law occasions, and thus his real wage is 
lowered by the very legislation that was devised for his welfare. 

" The discretion of the judge checks many economic evils 
that might result from state regulation of industry. The in- 
crease 01 prices is beyond the court's control. . . . 

" Parliament was asked officially to remedy an evil by which 
'the advantages bestowed by progressive legislation are grad- 
ually being nullified and will eventually be destroyed . A 
similar demand has been made in Victoria, where it is claimed 
that so long as the government fixes wages, it should also fix 
prices [which, outside of a few monopolies, no government has 
teen able to do in all recorded time]; for the free manipulation 
of the latter may render ineffective any regulation of the former. 
The same suggestion has been voiced as a future possibility by 
the leader of the labor party in New South Wales. 
276 (I). Points to " The responsibility of the state for a living 
state employment wage, logically leads to the responsibility of the 
and socialism. state for employment at that wage. If these 
two functions of government are generally recognized as moral 
duties, and are realized in political action, the result is state 
socialism. . . . Broader knowledge and profounder study than 
have yet been devoted to this subject are required to give us 
conclusions of value." 



296 



The Protection of Rights. 



[§ 277 



The provisions for "slow workers" cer- 
aS'nat^raMawr tainly look as if the law had begun in an 
effort to rise superior to Natural Law, and, 
as always happens in such a case, were being perforce 
tinkered back into conformity with Nature. This gives 
a very discouraging outlook for the working of the 
Minimum Wage scheme, but while all caution should be 
used not to go counter to Nature, it should never be for- 
gotten that Nature's processes, when ascertained, can 
be aided by human intelligence and sympathy, and 
that in social affairs, experiments are as justifiable as in 
mechanics and chemistry. But extravagant and explo- 
sive experiments are foolish in all. More in regard to 
the experiments of the Minimum Wage will appear as 
we discuss the functions of the Arbitration Courts. 

A decreed and enforced wage can make employers 
prefe* to stop business, or can make employees prefer 
to beg; but it can never secure the payment of wages 
materially different from what would be secured by the 
laws of supply and demand acting in a medium of fluid 
competition. The only legitimate function of Arbitra- 
tion Courts (but it includes many others) is to keep 
competition fluid. This will give them enough to do, 
and give them glory enough if they do it. In doing 
it, they inevitably do all the rational work that Minimum 
Wage Boards can do, which fact is abundantly proved 
by the ease with which the courts are absorbing the 
functions of the boards. 



278. The Arbitra- Regarding Arbitration Courts, as Aus- 
tion Courts. tralasia, like the United States, is made 
up of a number of commonwealths passing most of 
their own laws, there has been a variety of experience, 
which now includes experience under a general law 
for the whole colony. 

Unlike America, where the immigrants have brought 
in a large element of Latin imagination and German 
sentimentalism, Australasia has little imagination, senti- 
ment or theory, but a very large element of hard- 
headed British common sense, and circumstances pecul- 



§ 278 a] 



Personal Property. 



297 



iarly favorable to its exercise — a homogeneous British 
community, plenty to do, a minimum stupid and venal 
vote, a British respect (which far suq^asses our alleged 
one) for education and experience, and (partly in conse- 
quence) a salutary scarcity of the ranter and the dema- 
gogue. The curse of the relations between Labor and En- 
terprise has been that poisonous product of rank democ- 
racy. He thrives on struggle: arbitration has no place 
for him; he is opposed to it. His attitude is that the 
relations between employee and employer are those of 
irrepressible conflict over the product. Mr. Gompers, 
the present successor of the long line of failures at the 
head of American Labor, has said: "It is a fight." 
But it is a fight in which, as a fight, Labor can never 
have any permanent success, for the simple reason that 
as fast as Labor develops honesty and brains, the bulk 
of them insensibly drift to the other side, in the ranks 
of the employers. The employers who were not drawn 
from Labor's ranks are too few to be worth taking into 
account. While the labor-leaders fatten on conflict, 
for the men there is no visible hope quicker than their 
slow advance in productive capacity, and the slow 
increase of fluidity in competition, of justice and of 
sympathy, unless that hope be compulsory arbitration. 

The hard-headed Australasians seem to have real- 
ized all this, and never to have had any use for Mr. 
Powderly or Mr. Debs or Sam Parks or Mr. Gom- 
pers with his "fight". After a few strikes that were 
passing zephyrs in comparison with some that those 
men have stirred up, the community in general, ap- 
parently including a large proportion of the working- 
men, did not propose to have any more fight. They 
278 (a), started to began with asking the two sides to arbi- 
preoent strikes. trate, and giving them facilities, and when 
that scheme would not work, they forced them to arbi- 
trate. The general motive of the arbitration laws was 
to protect the community and the men's families from 
the follies of strikes. There seems to have been no claim 
made that the men were not at liberty to damage merely 
themselves. 



2 9 8 



The Protection of Rights. 



[§ 278 a 



It will help the reader to understand the development 
of the courts, to be reminded again that the colony is a 
federation of states somewhat like the American union. 
Of these, on the continent of Australia are five, namely, 
Western Australia, South Australia, Queensland, New 
South Wales (capital, Sydney), and Victoria (capital, 
. Melbourne). Something over a hundred miles south of 
the continent, lies another state, Tasmania, and some 
twelve hundred miles east of Australia, and a little 
south, is still another state, New Zealand. On the 
eastern side of the continent are the continental states 
New South Wales and Victoria, nearest to New Zealand, 
which share with it the leadership in population, wealth, 
and activity in social experiment. A little care in 
memorizing these simple facts will be of service as we 
proceed. 

The first Australasian experiment of note in Com- 
pulsory Arbitration, was New Zealand's Industrial 
Arbitration Act of 1894, much expanded in 1900 and 
adopted in its main features by Western Australia and 
New South Wales. 

279. Ineffectiveness . E ? OT * S haVe been ™*<\ in al ™° st *VCTy 

of Voluntary civilized state to reconcile labor disputes by 
Arbitration. boards for voluntary conciliation, such 
boards being often established by legislation. In cases 
of little importance their awards have been often 
accepted; in cases of great importance, seldom. Presi- 
dent Roosevelt's coal-strike commission recommended 
statutes authorizing governors to appoint "commis- 
sions of compulsory investigation" with full power of 
calling witnesses and examining them under oath, when 
labor disputes threaten serious disadvantage to the 
community. The mere reports of such commissions 
would do something to settle disputes, without com- 
pulsory arbitration. Nevertheless after several seri- 
ous and disgraceful strikes in Australasia during the 
earlier nineties of the last century, Mr. Reeves, the New 
Zealand Minister of Labor, made a very thorough study 
of all that had been done anywhere by way of arbitra- 
tion and conciliation, and concluded that for the award 



§ 2So a] 



Personal Property. 



to have any effect, it must be compulsory, or at least 
that nothing worth while had been accomplished where 
the award was not compulsory, a main difficulty being 
that it was very hard to get either the party with the 
weak reasons, or the one with "the heaviest artillery", 
to go into court. 

280 The first ^° m x ^ 94 ^ ceves before the 
Compulsory Arbl- New Zealand Parliament a Compulsory 
tratlon Act Arbitration Act. It begins to look as if 

this step in the little parliament of an island in the 
Pacific, which to the vast majority of the civilized world 
is little more than a name, may yet be regarded as 
one of the most important of the world's pieces of 
constructive legislation. I am not prepared to suggest 
that it probably will, but I suspect that it not improbably 
may. This suspicion I have reached after a very full 
"faith in its impracticability, based on a priori con- 
siderations, followed by a study of its actual results, 
including those of similar acts in Australasia which 
have sprung from it. 

Among a great many wise and careful details, the act 
provided that the court should be appointed by the 
Governor General, and consist of a Judge of the Supreme 
Court, a representative of workingmen to be chosen 
from a list submitted by them, and a representative 
of employers similarly selected. 

Operatives could appear before the 
w?yUnhl!^ 9nlZ9C 'court only through their unions. This not 
only to avoid petty disputes, but because 
all troubles worth avoiding have hitherto come from 
unions. If any men are in danger of losing their chance 
in court, the law requires unions to admit members 
freely, and but seven men are required to form a union 
where none exists. 

Employers could appear individually or in organiza- 
tions. 

The tendency was to favor unionists as against non- 
unionists, because the former must bear the brunt of 
the contentions. Non-unionists could not go into court, 



300 



The Protection of Rights. 



[§ 280 a 



and consequently could not hale their employers into 
court, but they were free to strike. 

The court could decide or dismiss any question brought 
before it, and there is no appeal. 

Powers of summoning witnesses and getting expert 
advice are similar to those of courts in general; even 
additional members of the court could be elected in 
special cases. 

Books of account could be called for, but examined 
only in secret. Yet rather than produce their books, 
employers have sometimes come to an agreement with 
their men — and in one case at least, an agreement which 
was renewed. 

Mr. Lloyd, who wrote in 1890,* and from whom most 
of the facts regarding the Arbitration Courts up to his 
time, have been taken, says: 

4 It is a curious phenomenon of antipodal public opinion that 
America is being swept by waves or opposition on one side 
of society to trade-unions and of opposition on the other side 
to unions of capitalists, while in New Zealand the people and 
the government favor the fullest organization of both.' 

This raises the interesting question whether with 
courts in which to fight out their differences, the two 
extremes of the industrial world might not keep each 
other's excesses in order, without the rest of the com- 
munity being troubled with either. 
280 (bi Could dia- Objectors to compulsory arbitration mis- 
miaa trivial claims, trusted the tendency of the workmen to 
appeal to the courts on worthless grounds, and to 
expect from them impossible results. This fear has 
been to some extent justified; but men will not risk 
strikes for reasons as worthless as some that lead them 
to seek arbitration. Yet certainly in many cases, arbi- 
tration takes the place of strikes, and is vastly pref- 
erable to strikes. 

Many students of such matters — prob- 

280 (oK Damages. {% WQuXd be safe tQ sav most __ among 

whom I confess myself to be one, believed that the 
* "A Country without Strikes", by Henry Demarest Lloyd. 



Personal Property. 



301 



compulsory courts would be ineffective, mainly on the 
ground that nothing could be recovered when damages 
were given against people who had nothing. But our 
expectations have been confounded, in that there have 
been no occasions to decree very serious damages. 
Occasions for great damages, like strikes, boycotts and 
arson, have been taken care of by the preventive ounce 
of argument and adjudication, rather than by the cura- 
tive pound of damages. 

280 (d). Faithful Another objection was that men may 
acceptance of be compelled to work, but cannot be com- 
decreea. pelled to work efficiently. Yet a good 

deal of efficient work has been done under the coercion 
of the lash ; and a good deal more under the coercion 
of the stomach ; and the coercion of a respected court 
where one has been fairly heard, hardly seems more 
repugnant than that of an unsuccessful strike, espe- 
cially as bitterness has seldom been engendered in reach- 
ing the conclusions of the courts. 

As it has been objected : "You cannot collect damages 
from the poor and you cannot force them to work well 
if they do not want to," so it has been objected: "You 
cannot make men conduct business under conditions 
which they consider unfair." Yes, you can: they 
would rather put up with considerable injustice than 
have their capital and their brains lie idle. But they 
need not be irked with much injustice or even with 
any, under compulsory arbitration: all these objec- 
tions have been against extreme possibilities, which, 
with capable and well-meaning courts, have seldom 
occurred, and as the courts grow in experience, are 
occurring more seldom. 

Mr. Reeves wrote to the London Times: 

11 Why assume that the awards of a competent tribunal will be 
intolerable to one side or the other? It is likely enough, nay, 
certain, that all awards must be disagreeable to somebody, 
but intolerable is a word which presupposes that awards are 
likely to be made which will involve one side or the other in 
ruin, or drive it to desperation." 



302 



The Protection of Rights. 



[§ *8o* 



280 (e). compe- Another objection was that you can- 
tence of court* in not fix wages by law ; and it was well 

business affairs. [( yQu tfy ^ fix them CQunter ^ 

natural law. But the object of the court has been to 
ascertain from very thorough investigation what wages 
naturally should be, and so decree them. Probably 
the job is generally better done in that way, than 
through a strike or a lockout. 

It has also been urged that you could not get prac- 
tical business wisdom out of a court. But the world 
has been doing that for a good many centuries, and 
that, too, before, as in Australasia, business men were 
made members of the court, with power to call in others 
as need might arise. 

280 (f). Effect on The New Zealand law left the parties to 
strikes. fight it out if neither of them cared to go 

into court, but they have generally preferred to go 
into court. Yet since the problematic law went into 
force in 1895, there has been among the men subject 
to it (the public railroad employees in the strike of 
1903 were not), no labor disturbance which an Ameri- 
can would dignify by the name of a strike. But Dr. Clark 
tells us that 

'* Even before the New Zealand act was passed, the relations 
of employers and employees in that colony were normally so 
harmonious that it is difficult to show positively that the 
industrial peace at present prevailing is due to legislation. In 
New South Wales and Western Australia strikes of some con- 
sequence have occurred in defiance of the court." 

280 r ) spread of ^ ut as kindred ^ aws were enacted in other 
the court* and un- states of the federation, and finally in 
expected activity. i904 a general j aw for the whole federa- 
tion, they have been obliged to go into court, but their 
doing so has seldom been w T ith any reluctance. This is 
not the place to recount the differences in these Acts 
and their results. We have room only for such details 
as characterize at least the majority of them. 

The Conciliation Boards in existence when the Act 
was formed, were not disturbed by it. Moreover, the 
court has a right to create minor boards of conciliation 



§ 28ot] 



Personal Property. 



303 



and arbitration. An appeal from them to the Arbitra- 
tion Court was of course allowed. Mr. Reeves ex- 
pected them still to settle seven-tenths of the cases 
(probably relying on the coercion latent in the appeal), 
and one of the believers in the court, probably for the 
same reason, said that it would not be used once in 
twenty years. Up to 1900, instead of being restricted to 
a tenth of the cases, it had settled two -thirds of them. 
280 (h). Both aides ^ n unexpected development was a tend- 
arrtutged cases to ency for employers to arrange with their 
nf * r ' men to get cases before the courts which 

would bring decisions controlling dishonest and sweat- 
ing competitors. This effect was similar to that already 
noted in the case of the Minimum Wage Boards — in fact, 
seems to be another illustration of the tendency of the 
Arbitration Courts to assume the functions — indirect 
as well as direct — of those boards. Thus men who 
wanted to cut wages in order to cut prices, have often 
been restrained. The wisdom of the court has un- 
doubtedly prevented this from being a serious damage 
to legitimate competition, yet on the other hand, its 
effect on prices has probably not invariably been for 
the good of the whole community, as already indicated 
regarding the Wages Boards, and as will farther appear 
later. 

The courts provide rates "for superior, average and 
inferior men. No one can be employed for less than 
the average, except, as has been already explained, men 
not competent to earn the average, and the rate paid 
them must, if questioned, be sanctioned by the local 
Board of Conciliation". 

The success of such an arrangement, should it con- 
tinue, would seem to illustrate how a law that cer- 
tainly never would, and hardly could, be voluntarily 
obeyed in spirit by those upon whom it is enjoined, 
can be helped into a working condition by a court 
well adapted to the requirements of the situation. 
280 (i). courts Experience has abundantly shown that 
trM to follow all the successful minimum-wage fixing 
the mar et must at best resolve itself into a declara- 



304 



The Protection of Rights. 



[§ 280 i 



tion, by an honest and painstaking authority, of what 
conditions point to as the natural rate of wages, and 
this certainly is a great deal better than a determina- 
tion of them by boycott, arson and murder. Mr. Lloyd 
quoted an anonymous commentator to the effect: 

14 Compulsory arbitration docs not attempt any interference 
with the 'law of the market'. On the contrary, it gives the 
'law of the market ' for the first time a full chance to work. It 
brings the 'law of the market' into full and free discussion. 

Fixing by law' is an odious phrase. How about fixing 
prices by the fiat of a corporation or a capitalist, or by bayonets, 
or by starvation or intimidation? Here, 'law' means debate: 
the lack of it means destruction for the men. The law does not 
dictate or fix wages, but merely decides in a dispute between 
two different views of what wages should be. 'Law' fixes 
creditors' shares in bankruptcy, lowers Irish and Scotch rents, 
fixes the price of ferries, railroads, the salaries of state officials, 
rate of taxation." 

280 (]). court's As already said, the first court, in New 
power of initiatim. Zealand, could be put in motion only by 
one of the parties to a controversy. But the present 
usage empowers a court to take up, of its own motion, 
any apparent industrial abuse. But even under the 
primitive practice, Mr. Lloyd was hopeful enough (He 
has often been accused of being too hopeful) to say : 

" Trusts like those now coming into favor in England, such 
as that of the bedstead-makers of Birmingham, in which the 
masters and the men have united to fleece the public, would 
not be very promising subjects for compulsory arbitration." 

He continues : 

280 (k). Question "Another objection often made is, that in 
of overcrowding. conse q U ence of the law, industry is disturbed 
by the frequency of disputes ; but when I looked into the number 
of cases before the court, I found that there had only been about 
fifty in five years, about one case a month. . . . This, too, it is 
only fair to remember, is the number of disputes at the beginning 
of the administration of the law. Every decision that settles 
questions makes precedents that will prevent other disputes 
from being brought forward." 

This is one of Mr. Lloyd's optimisms. In the half- 
dozen years since he wrote, things have moved fast, 



§28l] 



Personal Property. 



and, as will be shown, experience has not altogether 
continued the rosy look which the experiments bore 
nearer their dawn. But while unanticipated difficulties 
and abatements have arisen, enough success to justify 
the experiment still seems possible. But there is 
abundant evidence that the courts have been some- 
times overcrowded, and that too by questions so trivial 
that they have sometimes refused to consider them. 
He himself quotes a "labor member" of one of the 
boards to the effect: 

"Agitators foment disturbances to bring the masters before 
the court. It is suspected sometimes that even members 
of the Conciliation Board, who are paid for the number of days 
they sit, do the same thing. But which is worse, that agitators 
should foment arbitration, or foment strikes?" 

The effect of compulsory arbitration has been pecul- 
iarly happy on the condition of women workers. Even 
if Mr. Lloyd's paean in his chapter 44 A New Song of 
the Shirt" was pitched some notes too high, there is 
no doubt that a paean is justified. 
281. Aspects h The following passages throw much 
1890. light on the case, or at least on one side 

of it, as it looked about 1890. 

"The subject came up one day in a group at the club in 
Wellington. One of the critics of the law quoted triumphantly 
from a letter of Lord Thring's: 'Is it conceivable that at the 
close of the nineteenth century either masters or men would 
submit to such a tyrannical judicial interference with their 
liberty?' 

41 'Forfive years', replied one of the New Zcalanders, 'masters 
and men have been submitting. They may not be satislied. 
Where anywhere are there satisfied capitalists or laborers? 
Where is there an employer who would not like to pay less, 
where the workingman who would not like to get more? But 
they are all at work, though not satisfied. In New Zealand 
it is proved that the Arbitration Court can make decisions 
which both sides would rather accept than to quit, as they 
always have the right to do '. " 

And now a word on one of the excesses of theory 
which the Arbitration Courts have stimulated. Mr. 
Lloyd stated it in perfect good faith, as follows: 



306 



The Protection of Rights. 



[§ 982 



" The New Zealand court has but just touched 
waces \nd prices m decisions on tne most important principle 

° p ' at issue in the regulation of wages — whetner 
wages must follow prices or prices wages. Must wages be 
dependent on prices necessary to market commodities, or must 
these prices be dependent on the wages necessary to maintain 
the people in decent comfort ? 

" The workingman's mind is evidently moving to the latter 
position. Several of the greatest strikes of recent years, like 
the English coal strike of 1893, and the strike in Lord Penrhyn's 
quarries, have had the 1 living wage' for their inspiring principle, 
and this new position of the workingmen in those strikes 
received the open support of some of the most influential mem- 
bers of Parliament, newspapers, and even capitalists of Great 
Britain. 

' 4 This doctrine seeks to make true the fiction of John Stuart 
Mill that wages are determined by the standard of living among 
the workingmen. What John Stuart Mill said was the law 01 
wages, the workingmen are seeking to bring about. The New 
Zealand law, the moment that this new political economy that 
prices must follow wages invades the bench, can be made a 
powerful instrument in reinforcing the workingmen." 

This is no more or less than one of the raise-yourself- 
by-your-bootstraps notions of which we see so many: 
somebody has got to pay those wages, and nobody has 
an unlimited store to pay them with. 

Some of Mr. Lloyd's final conclusions in 1890 are 
worth quoting, partly as bases for comparison with 
later writers. 

" There is only one Compulsory Arbitration law 

Joncluslons ln y !900. * n the world - ™* that has been in operation only 
four years and in an isolated country, and we 
must not generalize too freely. Similar laws might operate 
differently in different countries. . . . 
" Strikes and lockouts have been stopped. 

" Wages and terms have been fixed so that manufacturers 
can make their contracts ahead without fear of disturbance. 

" Workingmen, too, knowing that their income cannot be cut 
down nor locked out, can marry, buy land, build homes. 

" Disputes arise continually, new terms are fixed, but in- 
dustry goes on without interruption. 

" The country is more prosperous than ever. 

" Compulsion in the background makes conciliation easier. 

" Compulsory publicity gives the public, the real arbitrator, 
all the facts of every dispute. 

" Peaceable settlement with their men has been made possible 



§28 S ] 



Personal Property. 



307 



for the majorities of the employers who wanted to arbitrate, 
but were prevented by minorities of their associates. 

" Humane and law-abiding business men seek the protection 
of the law to save themselves from destruction by the competi- 
tion of inhumane and law-breaking rivals, 

" The victory is given as nearly as possible to the right instead 
of to the strong, as in war. 

" If the American people have any lessons to learn from these 
experiences of New Zealand, they can be trusted to learn them. 
The object of the writer has not been to enforce his views, 
but to present the facts of an interesting social experiment, on 
which the public could, if it chose, build views of its own. 

"Of course, 'our circumstances are different Our circum- 
stances have not been so different but that they have developed 
the same evils. Perhaps they may develop the same remedy. 

" And as for the isolation, that is a fortunate incident for the 
weak, but the United States has a nobler kind of isolation in 
its might and wealth. It can stand alone for any cause it 
chooses to espouse." 

At this point we turn more definitely to 
fn 8 i 4 903. r ' Reevei Mr. Reeves,* the father of the New Zea- 
land Arbitration Act, whom future ages 
may perhaps give a high place among the contributors 
to the welfare of mankind. His attractively written, 
instructive and interesting book of course is from his 
point of view, but it seems to be admirably candid. It 
appeared some three years later than Mr. Lloyd's, when 
Mr. Reeves's revolutionary Act of 1894 had been work- 
ing eight years, and had become the parent of others. 
285. Claims con- He tells us that from 1895 to I 9°° under 
tlnued success. the Act, factory hands in New Zealand in- 
creased from 30,000 to 49,000, and export trade grew 
from 1894 to 1 901 nearly 50%; factories from 1896 to 
1 901 nearly 30%, and total wages paid nearly 60% 
(which seems to indicate an advance of nearly 20% 
in the rate of wages), and manufacturing output grew 
in the same time about 80%. 

There had been but half a dozen strikes up to 1903. 
Half of these were among government employees, who 
did not come under the authority of the court, and 
nearly all were settled by voluntary appeal to the court. 

* Reeves, William Pember: State Experiments in Australia 
and New Zealand, 2 vols. 



3o8 



The Protection of Rights. 



In 1900, when propositions to thoroughly revise the 
act were before the legislature, only one man spoke un- 
favorably of it. 

286. Judge Back- I n I 9° I New South Wales was medita- 
house's testimony, ting a similar act, and sent Judge Back- 
house, a cool, able and experienced man, to investigate 
the working of the court in New Zealand (1,200 miles 
off, over seas). His conclusions were: 

" The Act has prevented strikes of any magnitude, and has, 
on the whole, brought about a better relation between employers 
and employees than would exist if there were no Act. It has 
enabled the increase of wages and the other conditions favorable 
to the workmen which, under the circumstances of the colony, 
they arc entitled to, to be settled without that friction and 
bitterness of feeling which otherwise might have existed; it 
has enabled employers, for a time at least, to know with cer- 
tainty the conditions of production, and therefore to make 
contracts with the knowledge that they would be able to fulfil 
them ; and indirectly it has tended to a more harmonious feeling 
among the people generally, which must have worked for the 
weal of the colony. A very large majority of the employers of 
labor whom I interviewee! are in favor of the principle of 
the Act. One only did I meet who said out and out, 'I would 
rather repeal it and have a straight stand-up fight', while 
another was doubtful whether the present condition was better 
than the pre-existing. The first, in a letter, has since con- 
siderably modified his statement." 

Mr. Reeves thinks this "too roseate a view of the 
feelings of employers." 

In 1 90 1, Judge Backhouse's report was followed by 
a Compulsory Arbitration Act in New South Wales; 
one was passed in Western Australia in 1902, and one 
for the whole federation in 1904. 

These Acts differ much in detail, which of course 
cannot be entered into here, but they are a necessary 
and far from unattractive study for any one wishing to 
promote the substitution, anywhere, of law for war. 

287. The courts to The New South Wales Act does not 
keep the peace. make it necessary for either party to a 
quarrel voluntarily to go to court before the court can 
act: the registrar may call the parties into court, and 
this on the grounds as stated by Mr. Wise, the framer of 



§28 9 ] 



Personal Property. 



309 



the Act, that "combatants who are bringing an industry 
to a dead stop should be regarded as brawlers in a street 
who check traffic with their quarreling : they should be 
made to move on." 
Mr. Reeves says: 

288. Details by "It will be urged, doubtless, that until some 
Mr. Reeves. body of men has doggedly, or perhaps violently, 
refused to obey a compulsory award and been forced to the 
knees by legal process, the strength of the Act will not have 
been thoroughly tested. Might it not, however, be urged that 
the true strength of the Act is being shown by the absence of 
such incident? Docs not the growth of a habit of peaceful 
acceptance of decisions hold out the best hope of ultimate 
success for the system ? 

" Passing from objections, it is safe to say that the experiment 
seems on the way to prove several useful points. First, it shows 
that trade-unionists may be persuaded by the logic of experience 
to prefer arbitration to conflict, and that their unions may grow 
ana prosper in consequence. Next, that the compulsory deci- 
sions of a state tribunal may be quite as just and moderate 
as those of a private conciliation board, and that obedience to 
them need not mean ruin to an employer, or cruel hardship 
to work-people. Next, the working ot the Act has not strangled 
industry or fettered enterprise ; trade and business have steadily 
improved under it. Lastly, instead of it being found impossible 
to assert the Arbitration Court's authority, there is no serious 
difficulty in enforcing its decisions; indeed, the enforcement of 
awards, which is assumed by English a priori critics to be out of 
the question, has, so far, been found in practice to be by no 
means the most troublesome part of the work of industrial 
arbitration." 

In 1903, Mr. Reeves left the laws in the following 
condition : 

" Though not yet twelve months old, Mr. Wise's Act has already 
ceased to be the newest arbitration law in the colonics. The 
West Australians, finding their Act of 1900 defective, decided 
not to amend but to repeal it. Accordingly, in February 1902, 
they displaced it with a new enactment which followed more 
closely trie New Zealand model. It is noteworthy that, despite 
the example of New South Wales, this statute makes provision 
for boards of conciliation." 

289. Dr. Clark In Next, in 1006, Dr. Clark * takes up the 
1906 not quite so narrative. He wrote when the courts 
optimistic. were of course much more developed, 

* Op. cit. 



The Protection of Rights. 



[§ 289 



and I shall quote from him farther details of their 
constitution and working in their developed shape, 
as well as the latest results, which are not in all 
respects quite what the earlier writers counted on. 
As the brief quotations cannot do justice to his fuller 
exposition, I shall emphasize an occasional point by 
italics not his. The reader's patience is invoked for 
some repetitions arising mainly from comparisons with 
earlier conditions, and from the increased number and 
variety of the courts. 

As now constituted, the Arbitration Courts have all 
290. Courts now the powers of ordinary courts, and their 
have legislative decisions are not subject to appeal unless 
power * their interpretation of the act creating 

them is in question. They have also legislative power: 

" The general intent of the law is to give the court power 
to settle every point that might cause a strike or lockout. 
[The government employees were not subject to compulsory 
arbitration, and] a strike, in 1903, tied up the transportation 
of Victoria. This disturbance was accompanied by incidents 
that would have rendered the strikers liable to penal punishment 
in America, and would have been discountenanced by our 
trade-unions. Trains were deserted by their crews wherever 
they chanced to be when the strike began, stranding passen- 
gers and perishable merchandise in out-of-the-way places, and 
endangering life and property. The public answered this 
challenge to its authority by a strike law more 
strlkesf WS ag drastic than any legislation ventured by Ameri- 
cans in the most acute crises of their civil war. 
This law imposed a penalty of nearly five hundred dollars or 
twelve months' imprisonment for engaging in a strike on govern- 
ment railways, and made men liable to arrest without warrant 
or bail for advising a strike orally or by publication, or for col- 
lecting funds for the support of strikers, or for attending any 
meeting of more than six persons for the purpose of encourag- 
ing strikers. 

41 Arbitration acts derive their authority from the police 
powers of government. They are measures to prevent industrial 
disorder. . . . 

" The New Zealand law prohibits . . . strikes and lock- 
outs . . . while proceedings relating to the dispute are pending, 
and for a sufficient time beforehand to allow either party to be- 
gin proceedings if he so desires. . . . The new federal Act pro- 
hibits strikes and lockouts unconditionally, without regard to 
whether they are begun prior or subsequent to giving an award. 



§ 29S] Personal Property. 311 

"The [New Zealand] law prohibits strikes and 
292. Current lockouts among workers and employers in 
K;«frf& mpa " related industries. Parliament has defined all 
tnetic strikes, building trades as related industries. The court 
may extend this provision to other groups of employments. 
Consequently if an award has been given in the bricklaying trade, 
for instance, the mortar-mixers or the hod-carriers cannot tie 
up that trade by a strike, although unwilling to lay their case 
before the court. 

"A second contingency bringing parties in- 
293^ And makes voluntarily under the act, is where an award 

IJiiSL HkM?J n has been 8 iven in their industry limited to 
adjoining districts. ?ome Qther £ ortion of the cokmy T J hc cmployers 

or workers subject to the award might be injured in such in- 
stances by the competition of employers or workers in the dis- 
tricts not subject to its provisions. If so, they may have the 
award extended to establishments in the competing district. 
The purpose of this extension is not to prevent strikes, but in 
equalizing competition they are incidentally prohibited." 

This provision has been abused by starting a strike 
in one jurisdiction where a certain decision may be 
expected, in order to make the decision effective in 
an adjoining jurisdiction where it probably could not 
be obtained. 

294. Awards As was to be expected, the stringent 

evaded. control of the Arbitration Courts is often 

and easily evaded. Dr. Clark gives an illustration : 

"A service may be embodied in a commodity, and trans- 
ferred as an element or quality of a material object. To illus- 
trate concretely, an arbitration court may fix a day rate to be 
paid to saddlers, and a piece-work rate for every operation of 
making a saddle; but its jurisdiction does not extend to regu- 
lating the sale of the leather, saddle-tree, and other materials 
out of which a saddle is manufactured, or to the sale of a com- 
pleted saddle. Therefore, a manufacturer may sell these ma- 
terials to a workman, and the latter may sell the finished 
product to the manufacturer at a higher price than the materials 
cost, but at a l^wer price than the cost of making prescribed 
by the court plus the cost of the materials." 

Regarding the immediate effects of the decisions, he 
says: 

"It is impossible to give an arbitration court 
conditions 1 *° a course * n technology with each new set of 
proceedings. . . . The court's decisions seldom 



3ia 



The Protection of Rights. 



[§ *95 



adapt themselves perfectly to working conditions, and continue 
to be a chafing shoe upon the feet of industry. 

" A dispute before a court is less serious than a strike. . . . 

But these suits occasion expense and loss of 

296. Danger of time, and check industry so far as they render 
over-regulation. unce rtain future conditions of production. There 
are single employers in Australia who work under as many as 
seven awards. The total effect of having these disputes con- 
stantly at issue — and they may await decision a year or more — 
resembles that of an agitation for tariff revision in the United 
States. 

'Litigation is multiplied, because workmen will bring a case 
before the court where they would not risk a strike. So great 
is this evil that the court in New South Wales has recently 
adopted the policy of giving artificially created disputes no 
standing in fact. It has been proposed to require the consent 
of a large number of workers to start a dispute. But these 
are palliatives, not remedies. . . . 

297. Promotes cen- "Uniform conditions of employment favor 
tailization of either the big or the little proprietor more than 
Industry. his competitor. . . . Large merchants and man- 
ufacturers are said to have entered into collusive agreements 
with their employees to secure orders from the court detrimental 
to their smaller competitors. . . . Consequently, an economic 
tendency of industrial regulation is to centralize industry." 

The very result that all the fierce agitation against 
trusts in the United States is seeking to overthrow! 

To this significant objection from the worker's 
side, Dr. Clark adds: 

"As the average workers are in a majority and 

298. And uniform- control the unions, . . . their influence alone 
Ity of wages. shapes the policy of the arbitration authorities 

from the side of the workingmen. This influence 
secures conditions of employment that discount exceptional 
ability, and deaden the enterprise of more ambitious workers. . . . 
The value of their potential excess of service is thus lost to them- 
selves and the community. . . . [The court] cannot reverse the 
laws of gravity and enable the working people to raise them- 
selves by their bootstraps to a higher economic plane. Its 
orders must conform to economic law, or be speedily rendered 
ineffective by contact with stubborn facts. Consequently, awards 
ultimately become mere formal statements of average condi- 
tions of employment." 

299. But so mini- I n other words, the courts and Minimum 
mizes oppression. Wage Boards have wrought all these evils, 



§ 3°i] 



Personal Property. 



3i3 



and their decisions might appear to the superficial to 
amount to nothing after all. But that would be really 
a superficial view: for it is by disturbing " average 
conditions of employment" — which means the average 
flow of supply and demand — that injustice is wrought. 
If a court can conserve average conditions, it accom- 
plishes a great deal. 

"The chief economic benefit workers derive from them [the 
courts] is that they render conditions of production sufficiently 
uniform in different establishments to keep unfair employers 
from obtaining a competitive advantage by oppressing tneir 
employees. Although the court's influence upon the average 
economic condition of the working people may be unimportant, 
it can effectively prevent unwholesome inequalities in their 
condition. . . 

Now he comes to the fundamental difficulty in all 
arbitration (268): 

"An arbitration law does not, however, rest 

300. Only one side equally upon employers and employees, be- 
can pay damages, cause the former are held to its strict observ- 
ance by their financial responsibility, while 

workers can. evade many of its provisions. In minor matters, 
the sanction behind the court's orders, so far as it applies to 
workmen, will always remain to a large extent a moral one. 

"But possibly this appeal to the honor and 

301. But moral civic responsibility of the worker is a more 
effective. ° adequate influence in favor of industrial peace 

than harsher measures. These laws do appear — 
in spite of the occasional defiance of their orders — to increase 
the law-abiding spirit. The public opinion of workingmen sup- 
ports their observance as a matter of principle. Whether the 
strike as an instrument for enforcing labor demands falls into 
absolute disuse or not, this spirit is a social gain." 

And he repeats that the courts have diminished 
strikes and sweating (despite a somewhat inconsistent 
showing made' earlier [276 e]) and child and female labor, 
and hours of work — the first two certainly a direct gain, 
the last two, results that attend the progress of civiliza- 
tion everywhere. 

The effect of the Minimum Wage Boards on prices 
(276 g) is continued by the Arbitration Courts, and 
more schemes in palliation or offset are arising. 



314 



Tlie Protection of Rights. 



[§ 302 



302. Continued "But in time the people who are not em- 
high prices and ployers or wage-earners, especially the rural 
palliatives. population, may resent paying high prices for 
services and commodities, in order that employers and employees 
may enjoy state-protected privileges. A popular demand may 
then arise for more regulation, for some method to protect 
the rights of the consuming public — the farmer, the professional 
man, and the person of small property. This might manifest 
itself first in laws to control prices, already suggested [and 
commented upon (276 A)], or for the state housing of citizens — 
cently inaugurated as a remedy for conditions caused in part 
by arbitration awards in New Zealand — or for the erection 
of state industrial establishments to compete with those reafoing 
a large profit under tariff protection and award control. 

The Paris workshops again! tho, it must be ad- 
mitted, with side issues — state housing and state 
competition with monopolies, which have aroused the 
enthusiasm of many people who rejoice in old expe- 
dients with new faces — especially when they do not 
know them to be old. 

Elsewhere Dr. Clark says: 

' 4 No error could be more pernicious than to assume that 
these laws have fully justified themselves by economic and 
social results. . . . The coming story of the labor party will 
be a record of failure as well as success. . . . Nevertheless it has 
won to its main proposals the support of all political parties, and 
of the great mass of the people. None of the parties now opposes, 
compulsory arbitration or old-age pensions. ..." 

Perhaps it would have been wiser to say, instead 
of "now opposes", yet opposes. For I have already 
quoted passages abundantly showing that opposition 
is brewing, tho it has not yet become strong enough 
to appear in the platforms of any party. 

And now we have reached a set of considerations 
beginning to diverge from the merely economic: 

303. Courts con- ' ' When an award is under litigation workers 
sider cost of living, often support their claims by testimony as 
and profits and to house rent and the cost of staple household 
all conditions. articles. Tite principle of a lh4ng wage is 
thcrejore fully established in arbitration precedents. The 
judge usually follows the theory that such a wage is a first 



§ 306] Personal Property. 



315 



charge upon an industry, to be imposed if the business is to 
continue in operation. . . . Dividends and other evidence of 
the earning power of a business are admitted as having a bearing 
upon an equitable wage for employees. The court thus fixes 
the share of the profits of an industry which the worker shall 
enjoy. . . . The court has considered such questions as the 
speed at which machines are to be run, the number of men to 
be employed to a machine, and whether men working in the 
open air, or their employer, shall decide when it is too wet to 
labor. 

304. Startling dec- " The cn * e f justice of New South Wales said 
laratlon of court's of the act : 1 // deprives the em player of the conduct 
powers. of his own business, and vests the management in 

tlie tribunal formed under the Act.' " 



The laws of two of the states 



305. Supports the " expressly state that the court shall have power 
closed shop — con- to give unionists preference of employment, 
optionally, though this is not mandatory'. In Western 

Australia a similar clause was defeated by the protracted oppo- 
sition of the upper house of Parliament. In the federal law 
the power is granted conditionally, but it is required that the 
union shall not engage in political activity while enjoying 
preference, and that this privilege shall be given only when, 
in the opinion of the court, a majority of the workers in the 
occupation regulated by the award approve of the claim for 
preference. The court in New Zealand has established its 
right to prescribe that non-unionist workmen already em- 
ployed when the award goes into operation shall join the union 
as a condition of retaining their positions. On the other hand, 
the court usually provides that the union shall have preference 
only so long as it admits any applicant of good character to 
membership, upon payment of moderate fees fixed by the 
court. . . . The stronger organizations had enforced the closed 
shop in Australasia before the court was established, and 
refuse to relinquish what they consider a vested right. They 
further claim the privilege of raising the issue in court, because 
it is a recognized issue in strikes. The men also assert that 
preference is just, because only unionists incur the expense, 
and the odium with employers, of securing awards, and are 
liable to penalties for breaking the awards. 

_ .. . " The most important objection to granting 
SandclaMffs- P refcrence to unionists arises from the organic 
lation by courts. " connection between the unions and the political 
labor party. Preference to unionists is prefer- 
ence of employment to members of a political organization." 



After learning all this, it is startling to find that 



316 



The Protection of Rights. 



[§306 



" The proportion of the whole population in such unions 
varies from a trifle over three per cent, in New Zealand to 
nearly seven per cent, in Western Australia." 

And does not all the foregoing mean class legislation? 
Dr. Clark seems to think it does: 

4 ' So at present the government orders business to be con- 
ducted according to the demands of particular classes. The 
interests of classes rather than of the public are consulted. 

"American judges hold that the legislature cannot make 
laws affecting the interest of a particular class — set apart from 
the whole body of citizens. These decisions have prevented 
laws in favor of or against members of trade-unions, and might 
apply to prevent compulsory preference of employment even 
to members of a quasi-public society like an industrial union." 

The Arbitration Courts have, as already said, many 
legislative privileges : 

"As a lawmaker, the court is the mark of virulent and par- 
tisan criticism, and its orders are subject to the same public 
comment and discussion as other legislative or administrative 
acts, while in its purely judicial capacity it receives the respect 
usually shown to a dispenser of justice. ... In an important 
mining case ... a newspaper commented editorially upon the 
merits of the issues involved. The paper was warned that it 
rendered itself liable to punishment. . . The 
frJdomof the press, f^om of the press is thus curtailed by ap- 
plying to a legislative body protective canons 
of law devised to procure \ininfluenced and unimpeded channels 
for the administration of justice. 

" However, in response to practical considerations, arbitration 
laws are evolving toward a separation of judicial and legislative 
powers. . . . Breaches of awards are prosecuted under an 
action of mixed civil and criminal character, and the defendant, 
if convicted, is adjudged to pay costs, and an additional sum 
partaking of the nature both of a fine and of an award of 
damages. Such a 'penalty' is made payable directly to the 
plaintiff." 

Dr. Clark, it is very important to realize, has shown 
that the effective administration of the law seems to 
require proceedings that attack what have heretofore 
been considered the foundations of civilization, and that, 
like the attempts to secure equal fortune to unequal 
men, give an impression that to justify such risks, 



§ 309] Personal Property. 



3i7 



the advantages of compulsory arbitration need to be 
almost incalculably great. Dr. Clark next gives still 
more startling testimony to the same effect: 

308. And "the " Wherever compulsory arbitration is in force, 

obligation of the court finds it necessary to annul or modify 
contracts". existing contracts of service, against the will of 

the parties, tho these contracts are not in themselves illegal. 

"An industrial agreement is a contract approved and sanc- 
tioned by the court, and might therefore be supposed to enjoy 
special immunity from alteration. In Western Australia the 
court has held that it cannot modify an industrial agreement 
without the consent of all the signatory parties. But elsewhere 
the court has amended these contracts, or substituted awards in 
place of them. . . 

All this would not be tolerated under the Constitution 
of the United States, which does not permit any state 
legislature even, not to speak of any court, to pass 
a law annulling the obligation of contracts. 

" Tho a legislature might declare certain classes of contracts 
in the future illegal, no law could be made so sweeping as to 
deprive all citizens of the right of making individual contracts 
of service, without causing a revolution in our [American] sys- 
tem of jurisprudence that would encounter the veto of the 
higher courts." 

But Dr. Clark has more to say: 

" Compulsory arbitration and private contract are in the 
widest sense contradictory. Their mutual opposition continu- 
ally creates new problems for legislators. . . . These laws revive 
the old historical struggle between contract and status. They 
reverse the process of evolution of private rights in European 
and British law." 

Does this mean simply a relapse toward barbarism? 
The reader new to the question is advised to read again 
Chapter XIII before continuing. 

The attacks on Freedom of the Press and Freedom 
of Contract, are accompanied by another attack on what 
have been supposed to be the bulwarks of liberty: 

" R* va l umons have occasioned some of the 
ttsemblv. most bitterly contested issues under the arbi- 
tration laws. The bogus union, formed by a 



3i3 



The Protection of Rights. 



[§ 309 



small group of employees disaffected with the existing organi- 
zation, with the connivance of employers, and used to defeat 
or hamper the operation of the law, has been the subject of 
parliamentary investigations in New South Wales. Therefore 
the state is forced, in its increasing control over labor societies, 
even to limit the right of free association among workingmcn. 
. . . The total effect is to make the condition of status more 
rigid." 



Next we come to something perhaps more startling 
still: 

" The Australasian legislator has not been restricted in 
enacting arbitration laws by constitutional limitations such as 
exist in the United States. ... In most [of those] states no 
power exists to create a tribunal with the right, 
by fury. without a trial by jury, to punish misdemeanors, 

* J impose a fine of nearly five thousand dollars, 

or even as a last resort to imprison offenders." 



Is this Good-bye to trial by jury? Australia is pro- 
gressive. But the experiment is new, and conditions 
are difficult. 

311. Attacks on But Australasians did not know where 
Mttf pw - they were going. 



"The colonies did not enter on this legislation with clear 
foresight and purpose. The form and effect of these experi- 
mental statutes were not pondered with the care devoted to a 
revolutionary programme. The proposer of the New Zealand 
law stated in the debates upon the bill, that a vast majority 
of the disputes coming before the authorities would be settled 
by conciliation, without recourse to the court. The function 
of the latter body was not regarded as legislative, but as purely 
judicial — or rather as also conciliatory. The purpose of the 
law was to bring men to a voluntary agreement. It was to 
further, not to annul, the principle of private contract. . . . 
The development of this legislation, however, has been in 
another direction. . . . 

" Workingmen have applied for nearly all the 
312. New conditions, awar( j s granted in New Zealand and Australia, 
unexpected results. Thdr demands whcn they file an application 

before the court, are not guided by past conditions. . . . 
Therefore the court is obliged to make orders covering many 
points for which no precedents exist .... Statutory or custom- 
ary law is not at hand to guide its decisions, and so must be 



§314] 



Personal Property. 



3*9 



enacted. But a new body of legislation . . . requires constant 
amendment to correct the contradictions and omissions that 
reveal themselves in practice. The legislative activity of the 
court is consequently stimulated from two directions, by the 
increasing demands of workers for better terms of employment, 
and by appeals from both parties to have conditions previously 
imposed made more workable. 

" The divergence between the original theory and purpose 
of industrial arbitration, and its present development, is over- 
looked or disregarded. The final effect of this new institution 
upon private law and theories of government is not considered, 
because the popular attitude toward this legislation is oppor- 
313 Yet all tunist and practical. But the labor party, 

admitted to be which is tUe most active supporter of industrial 
progress toward arbitration, fancies that it is a step touard state 
socialism. socialism." 



314. Has experl- And these steps toward state socialism 

dSl!m atwa? * are over what a labor agitator in other 
with Liberty and connections would be apt to call "the 
Progress? prostrate bodies" of trial by jury, of free- 

dom of the press, of right of assembly, and of contract; 
and are of course steps back toward status! The conten- 
tion that state socialism and status are synonymous 
terms, seems receiving a startling confirmation from 
experience, even before state socialism has become mat- 
ter of experience. 

After I first read, as a whole, the foregoing con- 
densation from Dr. Clark's book, I wrote to him that 
I did not before know what a terrible indictment of 
government control of industry the book contains. 
That the extracts turned out an indictment was due, 
however, to no will of mine. I tried to be as fair to 
both sides as he is. 

Either the indictment is terrible, or the experience of 
thrice ten centuries through the whole world, has been 
shown to be foolishness, by ten years of experiment on 
three islands in the Pacific. And this remains true, 
even if the right of trial by jury is, as many sober 
thinkers suspect, outgrown in a fairly democratic state; 
and even if contract, like many other invaluable insti- 
tutions, is capable, in abnormal conditions, of working 
injustice. But surely its abnormal conditions should 



320 



The Protection of Rights. 



never be approached with a hand less cautious and 
reverent than the ideal surgeon's — or the ideal jurist's. 

These most weighty considerations show plainly that 
in Australasia the thunder is rumbling. But as yet no 
bolts have fallen; Dr. Clark says: 

315. No business " The evidence does not show a general 
disasters yet. setback from government regulation of in- 
dustries. The investment of foreign capital may have been 
checked by the novelty and uncertainty of this legislation, but 
local capital has been found to meet the demand of growing 
enterprises. The impression the country makes upon a visitor 
is not that of a land where industry is paralyzed and business 
stagnated, but rather the reverse. Permanent and costly 
buildings are being erected in the larger cities, public improve- 
ments are going forward, the wharves are crowded with shipping, 
the railway service is fully occupied. . . . There are few 
evidences of excessive unemployment. To a person studying 
conditions in Australasia, the economic argument that a country 
will be industrially ruined by state regulation is not convincingly 
demonstrated. But this does not prove or disprove the ad- 
visability of the laws embodying these experiments: for the 
argument in question is too general to be valid. The prosperity 
or depression of a country's business rests upon a broader 
basis than an industrial arbitration act." 

Yet our author goes on to show what 
?np^s E pe P ^ has been claimed before, that state regula- 
tions have not yet been tried under ad- 
verse conditions, but have been acting only in a period 
which other causes made one of great prosperity. 

" Since the passage of the oldest of these laws, the Victorian 
Minimum Wage Act, federation has been accomplished, and a 
national tariff with free trade throughout the Commonwealth 
has been substituted for a local tariff and free trade only within 
the borders of the colony. This enlarged market has caused a 
great expansion of manufacturing. The exportation to other 
states of the federation of twenty-four classes of locally made 
articles increased over one hundred and forty-seven per cent, 
during the first two years after the national tariff went into 
effect. . . . This has stimulated the demand for factory opera- 
tives and raised wages in many skilled occupations." 



Yet one is not surprised to learn that 



§319] 



Personal Property. 



321 



317. Disagreement " The economic effects of government rcgula- 
as to prospects. tion of industry are still a matter of controversy 
in Australasia. . . . The contention that the capitalist is 
benefited by having wages fixed and other conditions of em- 
ployment determined by a government authority, is some- 
times supported by plausible arguments; but it is contra- 
dicted by the attitude of most employers toward these laws. 
As a body, they oppose compulsory-arbitration and minimum- 
wage boards. . . . JProbably the influence — good or bad — of 
state regulation upon the prosperity and development of 
industries has been exaggerated. . . . Indeed state regulation 
applies to the industries that are the main source of national 
income only to a very limited extent." 

318. Increased But whatever may be the gains or 
fealty to law. losses through the Australian labor legis- 
lation, even if the tinkering and expensive bracing it is 
already demanding, shall tinker and brace it into some- 
thing else, or out of existence, one effect of it should 
be viewed in America with special hope and honor: 
for as Dr. Clark says: 

"It is a law-abiding agency, and the forces that in other 
countries threaten to disrupt society, serve, in Australasia, only 
to strengthen social bonds." 

Yet this does seem a little difficult to reconcile with 
what he expressly asserts of class legislation ; restriction 
of freedom of the press, of assembly, and of trial by 
jury; and interference with contract. 

But the dispassionate doctor's valedictory is: 

"But if state regulation clearly fails to benefit wage-earners, 
the country will probably return to free private administration 

319. The equlllb- °* industry. The essential fact is that the fres- 
rlum unstable. cnt condition is unstable." 

Knowing the policy of a set of doctors plainly not 
of his school, he adds: 

"The workers are still confident that state regulation does 
help them, and will continue to do so. Therefore the limited 
experience with compulsory arbitration up to the present, sug- 
gests the possibility of a further development toward state 
socialism." 



Like protective tariffs, and stimulants and narcotics — 



322 



Tlie Protection of Rights. 



[§3i9 



when the amount in use is proved ineffective, give more! 
320. The latest As these pages are about to leave my 
w <> rd ' hand, there comes through a correspond- 

ent of the London Times one of those messages, ex- 
treme on one side or the other which constantly ema- 
nate from Australasia. 

As quoted by the New York Times, the correspond- 
ent makes out that 

"Neither party is really satisfied with the state of things 
in New Zealand; both parties are, in fact, extremely cUs- 
satisfied. The Australian Minister for Agriculture, returning 
from a visit to New Zealand, has reported that he found the 
Arbitration Act ' working to great advantage.' The Secretary 
of the New Zealand Federation of Employers tells the cor- 
respondent that the employers do not agree with this view. 
The workmen, according to this authority, are 'assailing the 
employers, threatening to ignore the Act altogether, and to 
return to their old methods; there has never been any greater 
friction in labor matters than at the present time.' From the 
employers' point of view the Act has not made for better work 
or for improved methods, and it has not fostered trade. On 
the other hand, it has seriously increased the cost of production. 
This increase has been such that in those articles which New 
Zealand might be expected to export, such as clothing, woolens, 
timber and coal, she is unable to take advantage of her natural 
facilities. 'The history of the court has been increased impor- 
tations and decreased local output.' . . . The Seamen's Union 
and the Otago Trades and Labor Council have in turn de- 
nounced the court." 

But despite frequent casual statements 
Hkei aTfahure ^ e tms > anc ^ despite the deep shadows 
eyas a ure. ^ Clark's thorough and dispassionate 
study, we are by no means forced to the conviction 
that the threatening aspects of government regulation 
must lead to its complete overthrow. The dangers are 
almost inseparable from so young an experience, and 
there seems to be no unescapable reason to fear that they 
are due to anything more than the excesses of youth, 
or that they cannot be remedied as experience accu- 
mulates. 

As shown, most of the decisions have been in favor 
of the men, because the market has been steadily rising. 
Then if the principle of compulsory arbitration shall 



§ 3 22 a ] 



Personal Property. 



323 



turn out to be the colossal blessing to mankind which 
its friends claim, and which its enemies seem growing 
less inclined to dispute, the fact that it "happened" 
to be started at the beginning of many years of in- 
creasing prosperity, will be classed with such facts 
as Rome's unification of the civilized world when 
Christianity appeared — facts which, whether called 
" Providential* ' or by any other name, even the phi- 
losopher is tempted to accept as proofs of an order and 
beneficence in the universe wider than our everyday 
conceptions are apt to rise to. 

322. Gains In pros- What is to be the effect of compulsory 
perlty may carrv arbitration on a falling market, yet re- 
through adversity. ma i ns t o be ascertained. But the work- 
men have already had the discipline of eleven law- 
seeking and law-abiding years, to educate them to 
respqet the law when it goes against them. 

Of course the enthusiasts are tempted, in face of 
abundant other obvious causes for Australasia's prog- 
ress during the last decade, to attribute it too largely 
to compulsory arbitration; but it would be a blind 
opponent indeed who would give that no place what- 
ever among the favoring agencies. 

Laborers everywhere of course expect that every new 
expedient is going to give them much more wealth than 
they produce, and they resort to each expedient to the 
absurd degree that is already troubling the Australasian 
courts. But that, tho one of the greatest of their 
troubles, seems sure to remedy itself. 

Probably nearly all the excesses are due to trying 
to make the courts do too much. But it is far from 
proved that they can do nothing. To have virtually 
abolished strikes, and made the labor world law-abiding, 
is to have done a very great deal, and a great deal 
that we in America sorely need. We have already 
indulged in a good many futilities by way of voluntary 
arbitration, and a few successes, mainly in Massa- 
chusetts. But for labor's own sake, we 
V2rt¥h<wg9. rica nee d something stronger. Despite the dem- 
agogues who, honestly or dishonestly, make 



The Protection of Rights. [§ 322 a 



their living by fomenting Mr. Gompers's " fight", 
strikes will not be tolerated much longer in America. 
The intelligence of the industrial world, and the com- 
mon sense of the world in general, is but just organized 
against them. But the Citizens' Associations who pro- 
pose to have regularity in their transit and supplies, 
and freedom from riot, arson and murder; and the 
Industrial Associations who propose to have Enterprise 
regulate enterprises, are spreading at a rate beside 
which the spread of labor organizations was at snail's 
pace. Possibly the demagogues, for the sake of hold- 
ing their leadership, may fight compulsory arbitration 
until, as once in England, strikes may be abolished by 
law without arbitration to fall back upon. But apparently 
compulsory arbitration will come sooner or later: it 
is difficult not to have faith that the habit of seeking 
law, and understanding it, and abiding by it, which the 
labor world of Australasia is being trained in,* will 
ultimately save its arbitration courts from such fatal 
excesses as now threaten, and make them an example 
that the rest of the w r orld will be glad to follow as fast 
as institutions can be adapted to it. 



CHAPTER XXIII. 



PERSONAL PROPERTY (CONTINUED). 

Proved Methods for Diffusing it more Evenly. 

The coolie of China, the ryot of India, 
|«ir£r >grWS,n the feUah °f Egypt, the peasant of 
Russia, are in a condition not very 
different from that of virtually all mankind a few- 
thousand years ago, and that our own ancestors had 
not got very far beyond a thousand years ago. When 
we compare them with the present population 
of Japan, civilized Europe and civilized America, 
we realize that over a large part of the world, pow- 
erful agencies have long been at work for the bet- 
terment of man's estate. A little thought must con- 
vince us too that the betterment has been greater 
among the masses of mankind than among the few 
at the head. The average man's condition is now 
nearer that of the exceptional man, who is forced to 
respect his life, liberty and property, than was the con- 
dition of the feudal retainer who held all these things 
at the mercy of his lord.. In the essentials of a healthy 
existence — food, clothing, shelter, sanitary surround- 
ings, hospital facilities, education, the average man 
to-day is vastly nearer the favored man than he was 
not merely thousands of years ago, but centuries ago — 
yes, decades ago. Since the middle of the last century, 
there have rapidly accumulated figures which prove 
that even in that comparatively insignificant period, 
the progress is not, as might have been expected, corre- 
spondingly insignificant, but very significant indeed. 



325 



326 



The Protection of Rights. 



tS 323 



The agencies that have thus been distributing the 
good things of life, are of course innumerable, and the 
study of them is too recent, even could it possibly be 
adequate, to reach a very thorough knowledge of them. 
But we know some of them w r ell enough to enable us 
to promote their efficiency. 

Before proceeding, however, to such detailed con- 
sideration as we can give them, it is w r ell worth while 
to pay some attention to the general facts which prove 
that there are enough agencies whose efficacy has been 
proved, to render foolish all headlong confidence in the 
untried quack stimulants which are constantly suggested. 

But first let us realize that w r hile we would like every- 
body to get rich in a generation, there is no way to 
bring it about: Nature has settled the matter in her 
own way: there is not ability to produce enough. 
The annual production of the country averages less 
than $250 apiece, and, as we have seen, the accumulated 
wealth is but about $1,200 apiece. 
324 Diffusion of ^ more general diffusion of wealth, then, 
wealth depends on must wait for a more general diffusion of 
diffusion of Ability. ability to pro duce it. As already said, 

wealth is Nature's prize to stimulate energy, fore- 
thought, temperance and honesty — in a word, Ability. 

Yet the man without ability gains much from the 
general progress of invention, and General Walker 
seems to claim * that he gains it all except a little of 
the inventor's share ; but the doctrine is not generally 
accepted to that degree. Mr. Atkinson, however, quotes 
Bastiat with approval to the effect that "in proportion 
to the increased quantity and effectiveness of capital, 
the aggregate share of the annual joint product of labor 
and capital falling to capital, is increased absolutely, but 
diminished relatively. On the other hand, the share 
falling to labor is augmented both absolutely and rela- 
tively." The laboring man does plainly gain much: 
for his cottage to-day contains many comforts that the 
home of the rich lacked half a century ago. 



♦ "Political Economy", Advanced Course, §§ 326-36. 



§ 325] 



Personal Property. 



327 



In 1903 the Massachusetts Bureau of Labor Statistics 
issued a bulletin showing that of 45,780 persons in the 
state who had retired from business with a competency 
for the rest of their lives, 1,076 were laborers. Yet 
the world is still divided up among a small proportion 
of rich and a large proportion of not rich. 

But the proportion is growing more 
tend to V ri$e? C8 favorable to the poor. When we were dis- 
cussing the relations of labor and ability 
(pp. 92-3), we took note of Gal ton's generalization that 
most men tend to be about average, and that the depart- 
ures from average tend to be relatively few. From this 
it is obvious that most men's incomes must be about 
the average — some $650 a year in America in 1900, 
and that those who have more, grow fewer and fewer 
as the incomes increase. Such is the condition at 
any given time, but there is a vastly wider generaliza- 
tion than Galton's, which, with the exception of that 
of evolution, is probably the most tremendous gener- 
alization yet given to the mind of man. I refer to 
Spencer's Law of Equilibration, which includes a 
corollary that under evolution, averages have a ten- 
dency to rise, and, in their progress, to include the 
individuals of the grades originally above them. Under 
this principle, if the dots in the supposed graphic 
representation suggested in the passage on page 93, 
could rise, the lower ones would, according to the law, 
rise faster than the upper ones, and the space occupied 
would continue to become narrower until in time all 
the dots would be concentrated on a line considerably 
higher than the original central horizontal line of the 
system. This new heavy line would represent all men 
having attained equality of ability, and consequently 
of fortune, and on a higher plane than any men occu- 
pied at the start. No civilization has yet been long 
enough to attain such a result, and it is vain to specu- 
late whether any civilization ever will be. But the 
evolution of each civilization has been toward such a 
result, tho it has been reversed when the dissolution 
of the civilization set in. If, then, a nation is still 



The Protection of RigJits. 



in the process of evolution, not yet having entered 
upon that of dissolution — if, for instance, the United 
States has not, as many fear, lost the preponderance 
of capable voters which started her evolution, and has 
not come under a government of incapable ones, which 
must initiate dissolution —if the country is still progress- 
ing, it is inevitable that the lot of average people should 
be improving, and that a larger portion of the people 
should be included among the average. For at least 
the fifty or sixty years for which the statistics are of 
account, they show these conditions to have prevailed; 
and there is enough general evidence from history, to 
indicate them to have prevailed, on the whole, among 
civilized peoples, since the dark ages. 
326. Diffusion In- Not only is the whole world grow- 
creaslng. m g richer, but the wealth is becoming 

more evenly divided. The trade-unions, despite their 
frightful mistakes, have undoubtedly enabled the 
laborer to get more of the benefit of the laws of com- 
petition, as we have seen, and they are making him 
more of a thinking man — in the last decade, by making 
him a great deal more trouble to think about, but at 
the expense of being more of a discontented man. 
But discontent is a good tiling, rightly used. It is the 
parent of effort. 

While "rich richer, and poor poorer" 
and'poor n'Sofer/'ls has all the authority of a proverb, the 
countries'" clvi,ized authority of a proverb is often very poor 
authority. This one simply illustrates 
how a slick phrase takes hold of people. There is 
probably no greater error in economics, and yet 
none more generally believed. The facts are over- 
whelmingly against it. In the United States wages 
have risen an average of sixty-eight per cent, since 
i860, and have nearly doubled since 1840. (On re-read- 
ing, I find this apparently self-contradictory, but take 
the figures at, say, 100, no, and 200, and it will be 
found more than workable.) Even as late as 1880 
the census gives the yearly average nearly $100 below 
that of 1890 — $346.91 as against $444.83. The com- 



§327] 



Personal Property. 



329 



parison cannot be relied on as exact, but the correct- 
ness of its general showing is certain. 

Prices have not risen with wages. They have gone 
down some eight per cent, since i860. Leaving out 
luxuries, Professor Mayo-Smith * says that the ^por- 
tion of family expenses directly affected by the price 
of commodities was as 94.4 in 1891 compared with 100 
in 1880 and of two hundred commodities in most 
general use, Mr. W. M. Grosvenor has computed that 
a dollar in 1885 would buy a quarter more than a dol- 
lar would buy in i860: and the Maine Bureau of In- 
dustrial Statistics reported that in 1887 a dollar would 
buy as much of the mechanic's usual food-supply as 
$1.20 would in '82, or $1.30 in '77. This was, of course, 
probably due to cheapened transportation from Western 
wheat-fields and cattle-ranches. 

In the early years of the twentieth century, for which 
statistics are not yet available, strikes have made a 
great increase in nominal wages, and a great increase in 
idleness. Both the wages and the idleness have had 
to be paid for in a consequent increase of prices, but 
this is obviously temporary. Later it will be consid- 
ered more in detail. 

The hours of labor average ten now; in i860 they 
averaged eleven; and in 1840 nearly eleven and a half. 

The proof of all these paradoxes up to 1894, is given 
in one of the most elaborate economic investigations 
ever made. It was carried on in 1892 and 1893 by a 
Committee of the Senate, whose reports of facts fill 
half a dozen large volumes. This report does not seem 
to need any backing up: for it is a mass of tables 
of carefully gathered facts; but it happens to be thor- 
oughly backed by other investigations here and in 
other countries. 

Some of the others here are that wholesale clothing 
dealers report a great increase in average size and 

♦ In "Statistics and Economics", to which important work 
I am indebted for several other points and facts in this chapter, 
I am glad to find some of my own previous conclusions rein- 
forced by his figures. 



330 



The Protection of Rights. 



[§3*7 



quality of clothes demanded, which shows that the 
people are better fed and exercised and better off. To 
come to reports of state authorities, in Massachusetts 
from '50 to '80, agricultural wages advanced fifty-six 
per cent.; from '6o to '83, general wages advanced 
over twenty-eight per cent., and from '6o to '85, those 
of mechanics twenty-five per cent.* In Connecticut 
from '60 to'87, men's wages advanced in the principal 
factories forty-three per cent., and women's fifty-seven, 
while their dry goods and carpets cost them more than 
a third less, but provisions about a tenth more. In 
i860, a laborer on the Erie Canal got fifteen cents a 
cubic yard for shoveling dirt; in 1889, he got fifty 
cents. From 1831 to 1880, wages of cotton-spinners in 
the United States increased eighty per cent., while the 
price of cotton cloth decreased sixty per cent., and 
the average consumption per head doubled. More- 
over, pretty much everywhere the proportion of opera- 
tives in the comparatively safe and agreeable and high- 
paid processes, has greatly advanced. 

About 1890, a Massachusetts machinist said, pub- 
licly, in speaking of the state of affairs in 1842: 

"The wages of a machinist in shop were Si to $1.25 a day: 
one nabob of a pattern-maker received the great sum of $1.50. 
They went to work at five o'clock in the morning, and worked 
till 7:30 at night, with an hour for breakfast and three-quarters 
for dinner. It was several years before we obtained eleven 
hours a day. It has now been ten hours a day for twenty- 
five years or more, and we grumble at that, tho we get more 
than twice the wages we did forty years ago ; and we are hoping 
to get the same or higher pay for working eight hours. I know 
the condition of the machinist is better than it was when I 
first joined the guild; he has better pay, better houses, better 
education, better living. For my part.'l don't want any more 
of the good old times. The present time is the best we have 
ever had, tho I hope no the best we shall ever see." (Quoted 
in Wells.) 

* Most of the facts in this and the next two paragraphs are 
taken from "Recent Economic Changes" by the late David A. 
Wells — a book that no one interested in the general welfare 
can afford to leave unread. 



§327] 



Personal Property. 



33i 



In Massachusetts for the period 1829-31 the pro- 
bated estates under $5,000 were 85.6 per cent, of the 
whole, in the period 1889-91 they had fallen to 69.5 
of the whole, while those over $50,000 had risen from 
13.4 per cent, of the whole to 27 per cent, of the whole. 

In Great Britain from 1840 to 1890, the number of 
estates subject to succession tax increased twice as fast 
as population, while the average amount per estate 
had not increased at all. In an article in the Royal 
Statistical Society's Journal for June, 1895, Mr. Bow- 
ley gave figures indicating that "money wages in- 
creased 40 per cent, from i860 to 1891, and considering 
the increased purchasing power of money, real wages in- 
creased 92 per cent. The eminent English authority, 
Mr. Giffen,* says that during the last half of the nine- 
teenth century (that is, beginning earlier and continu- 
ing later than Mr. Bowley's figures), the average of 
wages in England nearly doubled, while the working 
hours have decreased one-fifth. When he first stated 
this, it was so generally doubted that he repeated his 
investigations with the same result. f Mr. Mulhall 

♦ Giffen, Robert: Progress of the Working Classes in the 
Last Half-century. 

fSir Lowthian Bell, Mr. George Lord and Mr. James Caird 
have given facts in support of Mr. Giffen. (Wells.) 

Mr. W. H. Mallock, after an elaborate investigation in the 
British Census reports, the details of which are given in his 
" Classes and Masses", states the following conclusions: " People 
who are in want of the bare necessities of life ... if, whilst 
their own poverty remains the same, the riches of other classes 
increase, do, in a certain sense, become worse off relatively. . . . 
But this unfortunate class . . . has grown less and less numer- 
ous relatively to the entire population." This class "is not in 
any sense a sign or product of our modern industrial system. 
A similar class existed before that system ... and that system 
has relatively reduced and not increased its numbers . . . and 
the real problem ... is not how to interfere with the existing 
economic tendencies, but how ... to bring the residuum under 
their influence." "The poor" (except those who have nothing 
at all) "are getting richer; the rich, on an average, getting 
poorer . . . and of all classes in the community, the middle 
class is growing the fastest." Since 1830 the population has 
Increased "in the proportion of 27 to 35; the increase of the 



332 



The Protection of Rights. 



said that in England a laborer who got two hundred 
pence for a given amount of work, from 1 821 to 1848, 
got two hundred and eighty-five pence for the same 
work from 1880-83, while in the later period one hun- 
dred and seventeen pence bought as much grain as one 
hundred and forty-two did in the earlier period. In 
regard to beef, the showing was still more favorable. 
This cheap food was America's gift to the mother 
country. In 181 5 there were 100,000 paupers in Lon- 
don. At the rate of increase of population in 1875, 
there should have been 300,000. There actually were 
less than 100,000. 

section in question [the middle class] was in the proportion of 
27 to 84." "The middle class has increased numerically in 
the proportion of 3 to 10; the rich class has increased only in 
the proportion of 3 to 8." 

"From 1850 to 1881 the working classes have increased by 
about 15 per cent., whilst the middle classes have increased by 
more than 300 per cent." "The incomes of those with less 
than £600 have increased on the average something like 4 
per cent., . . . while the incomes of ninetecn-twenticths " of 
those who have over £1,000 a year "have decreased on an 
average over 7 per cent." "Landed incomes have not in- 
creased, but decreased by 14 per cent, in England, and by 13 
per cent, in Scotland." The total income ofthe millionaires, 
if divided among the population in equal shares, would 
yield each inhabitant a dividend of one shilling a month". 
3 4 The working classes have increased in wealth far faster than 
any other class in the community." "In 1880 the income of 
the working classes was (all deductions for the increase of popu- 
lation being made) more than equal to the income of all classes 
in 1850." In 1 88 1 there were seven thousand windowless 
cabins occupied by families in Scotland; by 1891, these had 
"almost disappeared ; the one-roomed dwellings with windows 
have decreased 25 per cent.; the two-roomed dwellings have 
increased by 8 per cent., and the three-roomed and four-roomed 
dwellings by 17 per cent.". "The smaller businesses, instead 
of being crushed out, are increasing more rapidly than the 
population." * ' There is an increase of 1 5 per cent, in the school- 
teachers; ... of 21 per cent, in the butchers, which showr 
the general increase of meat consumption; ... of 26 per cent, 
in the doctors; and ... of 53 per cent, in the persons who 
professionally minister to amusement." "The computed 
capital of the Post Office Savings Banks ... in ten years has 
very nearly doubled itself." 



§3 2 7 a l 



Personal Property. 



333 



In France from '53 to '83 wages advanced some 
sixty per cent., and in the principal occupations of 
women (outside of domestic service), they nearly 
doubled. 

In Germany, labor statistics are not as easily within 
our reach, but income-tax statistics prove the same 
thing. In Prussia, from 1876 to 1888, Dr. Soetbeer 
(quoted by Professor Mayo-Smith) finds that the pro- 
portion of income-tax payers with their families, to 
the whole population, had increased about 22 per 
cent., that is from 2.3 per cent, of the population 
to 2.8 per cent., and that the classes which had in- 
creased at the most rapid rate were those with incomes 
of over $500. And altho the most rapid increase of all 
had been in the class with incomes of over $25,000, the 
average incomes of that class had decreased, thus show- 
ing both that more people were getting rich, and that 
the rich were not getting richer. 

One fact general over all highly civilized countries 
shows that the details we have been going over, must, 
on the whole, be correct. It is that the consumption 
of food has been increasing faster than population. 
This cannot mean that the rich eat and drink more: 
for they ate and drank all they wanted before: so it 
must prove that the proportion of those who can eat 
and drink freely is increasing. 

Most of the foregoing discussion of wages and prices 
was published in 1901. Almost immediately there- 
after some strange conditions began to show themselves 
in the United States and to increase until at this writing, 
in the spring of 1907, they seem to have passed their 
culmination. 

The first of them was a run-up in prices of com- 
modities, following the general inflation of industrial 
properties through trust promotions. This inflation 
327 (a). Pendulum collapsed in 1903, but cotemporaneous with 
twinaa' backward it there had been a twofold inflation of 
in 1 03. wages — one resulting from the inflation of 

prices, the other from the greatest trade-union activity 
ever known. The unions had discovered a new panacea 



334 



The Protection of Rights. 



[§ 327 fl 



in the closely organized strike, and proceeded to apply 
it as vigorously as silver inflation or a protective tariff 
or any other panacea had ever been applied. Much 
of the advance of wages from this cause was of course 
purely nominal — it was obtained through the expensive 
idleness of the strikes, and followed by much more idle- 
ness or unemployment, because people w r ould not or 
could not pay the scale of wages reached. But the 
country being at peace, there being no money-heresies 
in the air, the tornado impending from the tariff being 
as yet no bigger than a man's hand, the crops being 
good, and Europe wanting them; gold production being 
large; the quadrennial business disturbance of the 
presidential election being more nearly settled by a 
foregone conclusion than usual — all these influences 
made the period one of prosperity so great as to encour- 
age the prosecution of the enterprises which had been 
held up by the high prices of labor. This was espe- 
cially true of house-building, and the various forms 
of engineering construction. The accumulation of these 
undertakings lias made an exceptional demand, for the 
time being, until at last most of the labor thrust into 
idleness by the new prices, has been set to work. 

When this dammed-up rush of new enterprises passes, 
and San Francisco is rebuilt, probably there will be a 
counter-revolution in wages, as, in fact, there has 
already been in some trades where there has been no 
previously dammed-up rush of activity, and, more espe- 
cially perhaps, where the employers have at last met 
organization with organization. But all these excep- 
tional disturbances may in some particulars make 
the preceding figures for the rise of wages and fall of 
prices during the preceding half century, look insig- 
nificant for the moment. Yet in considering whether 
they can still be accepted as conclusive indications 
of the advance of the general welfare, the exceptional 
and probably temporary character of the remarkable 
fluctuations of the past five years (1 901 -1906) should 
be carefully borne in mind. 

And yet in spite of them, the United States Labor 



§3*7 <*] 



Personal Property. 



335 



Bureau report for 1906 shows that the average wage- 
earner is working shorter hours than ever before, that 
he is receiving more pay for the short-hour week than 
he formerly received for the long-hour week, and that 
the increase in his average wage has been so great 
that its purchasing power has risen, notwithstanding 
the increase in prices of many commodities. 

From 1894 to 1905 the average wage per hour in- 
creased 21.5 per cent., while the average hours worked 
per week decreased 3.9 per cent. The average wage- 
earner, working shorter hours, earns 12.9 per cent, more 
per week than in 1890. 

The average price of food, weighted according to 
the average family consumption in the families of 2,567 
workingmen, increased 9.8 per cent, above 1890. Not- 
withstanding this increase, the average wage hour 
would purchase in 1895 8.1 per cent, more food than 
in 1890. Still more important has been the increase 
in the number employed, amounting to 42 per cent, 
over 1894 and to 40.9 per cent, over 1890. The com- 
bined effect of the increase in the average wage and 
in the number employed, was to increase the total 
amount paid in wages per week by 65.7 per cent, above 
1894 and 59.1 per cent, above 1890. 

The total cost of living shows a larger increase in the 
purchasing power of an hour's wage than is shown by 
the price of food alone, for while there has been a gen- 
eral advance in commodity prices, the average cost of 
living has not advanced in proportion to the cost of 
foods. 

Manufacturing establishments, especially the larger 
concerns, have been able to introduce economies that 
have to some degree offset the greater cost of labor 
and materials. One of the most important factors in 
moderating the advance in commodity prices gener- 
ally has been the decline in the cost of transportation — 
a cost that enters into the selling price of practically 
every commodity. The average freight charge per 
ton per mile for 1905, as reported by the Interstate 
Commerce Commission, shows a decrease of 18.6 per 



33<* 



The Protection of Rights. 



[§ 3«7 a 



cent, as compared with 1 890. The figures for 1906, when 
put in shape, will show a still further reduction. 

This rapid decline in the average cost of transpor- 
tation has been made possible by the expenditure of 
hundreds of millions of dollars for the betterment of 
tracks and road-beds, the elimination of grades and 
curves, and the purchase of more powerful engines and 
larger cars. This work will continue on an unpre- 
cedented scale for some years to come if it is not inter- 
fered with by radical legislation. But the threat of it 
is already making trouble. Yet the roads in trunk-line 
territory alone planned for the expenditure of not less 
than $400,000,000 in 1906 and 1907, and all over the 
South existing lines are being improved and extended. 

Dun's tables show that the cost of living per capita 
in i860, before the civil war, was $16.87 niore than in 
1905. For the sixteen years 1880 to 1895, inclusive, 
the average yearly cost was $101.65. For the ten years 
1896 to 1905, inclusive, the average was $81.52, $20.13 
less than for the earlier period. 

The preceding discussion has contained 
dllt,o!i fnToulI 6 ' many statements of the decrease of hours 
of labor, accompanied by rise in wages. 
It is inevitable, then, that the production per hour has 
increased. This is due to improved management, 
labor-saving machinery, and increase in the ability 
of the laborers. This latter has been both a cause and 
an effect: better wages and better conditions of living 
increase intelligence and working power. Of course a 
man working but one hour a day w T ill produce very 
little, and a man working twenty-four hours a day 
will soon produce nothing. In what number of hours, 
day by day, will he produce most? Experience seems 
to indicate that in the general run of work, the happy 
medium is about eight. And strange to say, this seems 
to be the experience when the w r ork is merely tending 
a machine: it will be so much better tended and kept 
in so much better order. 

The question of the eight-hour day is an exceedingly 



§3*7 fe ] 



Personal Property. 



337 



interesting one, and can be studied to good advantage 
in Mr. John Rae's book " Eight Hours for Work". 
There is no space for its detailed discussion here. Only 
Mr. Rae's general conclusions can be given. He sup- 
ports them with a great array of facts. 

Of course there is a great difference in trades. There 
are virtually none in which a reduction from the old 
working day of twelve or even fourteen hours, has not 
been attended with increased production; and of those 
trades where a farther reduction from ten hours to 
eight has been considered worth trying, the experiment 
has been successful in the vast majority of cases. 

The vigor of the operatives, their prompt attendance, 
their care and attention in their work, their care of 
their machinery, their speed in little repairs and in 
shiftings, have not only generally kept up the output, 
but in a very large proportion of cases, have actually 
increased it. 

The men have lost much less time from illness, and 
been put to much less expense for medicine, special 
diet and physicians' attendance. They have spent less 
for drink to overcome or solace their fatigue, and of 
course have suffered less from the consequences of drink. 
As a result, crime has fallen off. 

They have spent their increased leisure better than 
they did their scant leisure. Gardening, gymnastics, 
outdoor sports in their season, and reading and attend- 
ance at schools and lectures in the indoor season, have 
increased enormously; and with them of course, book 
clubs, reading-rooms and lyceums. All this has in- 
creased intelligence, which has increased production. 
It is not to be confused with the misuse of sudden 
comparative wealth, which is spoken of elsewhere. 

The old fallacy that "the profit is in the last hour" 
was suspected before the shortening of hours was tried, 
and when it was examined into, statistics proved that 
the last hour, so far from being the most profitable, 
was the hour in which occurred most of the expensive 
accidents to machinery, of the spoiling of material, 
and of the injuries to laborers, not to speak of most 



33» 



The Protection of Rights. 1 [§ 327 b 



of the expense of lighting, and a greater proportionate 
expense of heating in the colder hours of morning and 
evening. 

Workmen have been increasingly willing to pay for 
shorter hours through a reduction of wages, but the 
rule has been that even where production fell off before 
things were adapted to the new conditions (which it 
by no means always did), as soon as the adaptations 
were effected, rising production increased wages until 
in time they have in many cases, probably in most, 
become higher than before the reduction of hours. 

Foremen and the enterprisers themselves have 
abundantly testified that — perhaps most important of 
all — their own efficiency and the ease and effectiveness 
of handling their men, have benefited as much as the 
efficiency of the men. 

One good result expected from the change has not 
been realized, but that very fact is a virtual demon- 
stration that the change has not diminished produc- 
tion. It was expected by many that the hours taken 
from production would have to be restored by taking 
in a corresponding number of the unemployed. Many 
computations were published which proved to the sat- 
isfaction of those who made them, that unemployment 
of the willing would virtually cease. The expectation — 
unfortunately from one standpoint — has not been 
realized; but — fortunately for the proof that reducing 
hours has not reduced production — the proportion of 
the unemployed has remained about as before. 

The skeptical reader is urged to study the facts on 
which all these generalizations rest. Mr. Rae speaks of 
a book on the subject by Mr. Sidney Webb and Mr. 
Horace Cox. I have not considered it necessary to 
consult it, as it is said, on the whole, to support Mr. Rae. 

He also quotes an opinion of Mr. Jevons that the 
reduced hours are simply a result of the increased 
prosperity of the working classes — that they work less 
time because they can afford to. This factor must 
undoubtedly enter into the case, but one reason they 
can afford to work fewer hours is that they can do 



§3*8] 



Personal Property. 



339 



as much or more in the fewer hours, and their increased 
prosperity enters but very indirectly into their better 
care of their machinery and their own persons, and the 
improved use they make of their leisure time. 

I find a report worth mentioning, tho I am unable to 
give the authority, that among the cigarmakers 51 per 
cent, died of tuberculosis prior to the inauguration of 
the eight-hour work-day. Seventeen years after the 
eight-hour day took effect this percentage had been 
reduced to 23 per cent. 

An instance much later than those given by Mr. Rae 
has just come from the Austrian coal and lignite mines. 
In 1902, the daily working hours there were reduced 
from twelve to nine. In 1904, the average production 
per man per shift was higher than in 1901, by 6.6 per 
cent, in the coal mines, and by 9.9 per cent, in the lig- 
nite mines. 

328. Increase in ^ mav we ^ ^ e as ked if » until the recent 

wagw and decrease brief and exceptional period in America, 
in other prices come , . \ , « 1 

largely from prices the world over not having risen, and 
Capital's share, still wages having risen, and the laborers 
having worked less time, where the increase has come 
from. Much of it has come out of Capital's share of 
product. The census reports of 1880 to 1890 show that 
during the decade, the amount of wages paid in the 
country increased 131 per cent., while capital increased 
but 121 per cent., and value of product but 69 per cent. 
In England Sir Robert Giffen computes that from 1843 
to 1882 capital increased no per cent., and wages 145 
per cent. Fifty years ago, yes, thirty years ago, capi- 
tal in New York itself brought seven per cent., now it 
hardly brings four. In many of the Western states, it 
brought ten or fifteen, where now it brings six or seven. 
A similar reduction has taken place through the civilized 
world. This falling off of from a third to a half in 
capital's share, contributes largely to the increase in 
wages. True, the exceptional business activity in 1 904-6 
has increased the demand for capital, but this cannot be 
considered permanent : the very cause of it is increasing 



340 



The Protection of Rights. 



[§328 



capital at a rate that must lower interest as soon as, 
in the rhythmic course of things, the wave of activity 
passes. 

329 and from La- Ability benefits by reduction of the 
bor's increased interest rate, and in it must be included 
Ab,llt *' the increased ability of the laborers. Their 

increased wages have come from increased productive 
power, in ingenuity, carefulness and steadiness. The 
enterprisers have been bidding for improved labor as 
fast as labor would improve itself; and the best enter- 
prisers* bid highest. Of course the less they must pay 
for the use of capital, the higher they can bid. 

But of course a great deal of the improvement is 
due to the abilitv of the enterprisers and inventors. 
Processes are greatly improved, and so are transpor- 
tation and organization. In 1890, transportation alone 
cost, per unit, in America but about a third of what 
it did even so lately as 1860, and, moreover, forests and 
mines and productive arable land have been opened 
much faster than population has increased. Regarding 
the share the enterpriser gets, Professor Mayo-Smith 
thus summed up the evidence of the statistics : 44 There is 
scarcely any doubt that it is falling. Production on a 
large scale, enormous investments of fixed capital, and 
increased competition, compel the entrepreneur to put 
up with a smaller reward." Since 1873 "the laborer 
has conserved or improved his position by the main- 
tenance of, or even advance in, wages; the landowner 
has lost by falling rents; interest has fallen; and profits 
have been reduced to a narrower margin Later 
he says: "This progress has been due primarily to the 
abundance of capital, which, on the whole, works for 
the benefit of the laboring classes in two directions — 
by competing for labor-force and thus raising wages, 
and by cheapening products and thus making wages 
go further." 

The trade-unions have helped raise wages so far 
as they have increased the laborer's ability, and that 



§ 330] Personal Property. 



34i 



is very far. But so far as they have interfered with 
the Right to Work, and encouraged the various forms 
of scamping, of course they have diminished produc- 
tion, and, inevitably, retarded the advance of wages: 
for wages have got to come out of production. 

Probably the men who get their living out of the 
unions, would insist that the unions had secured for 
Labor a large portion of product to which it was justly 
entitled, and which, before the unions, it did not get; 
and on the other hand, probably many men who have 
suffered from the unions' mistakes, would say the unions 
had wasted more than they had secured. Both ex- 
tremes would be wrong. The unions have unquestion- 
ably done something, tho the decrease of interest on 
capital, and the increase of ability in inventors, enter- 
prisers and the laborers themselves, has plainly done 
so very much that it is absurd to claim that the unions 
have done the lion's share. Moreover, when we see 
that the establishments that make most money usually . 
pay the highest wages, it becomes plain that the com- 
petition of enterprisers for the best labor, must, inde- 
pendently of the unions' influence, have brought wages 
nearly, if not quite, as high as the enterprisers can 
afford to pay. 

Certainly the evidence we have been going over, 
proves that there is some better way to diffuse the 
good things of this life, than to reduce their production 
by communism, socialism or scamping. 

We saw the bad effects of scamped 
?u 3 $i<!n a Sf Hwestyf" work on the laborers themselves (228 a-c), 
tho they seldom suspect it. The dis- 
appearance of scamped work alone would make an 
enormous difference in what the wages would buy. 
Moreover, the mistakes of the unions cannot forever 
overcome the economic laws which entitle an honest 
workman to better wages than a dishonest one, just 
as an honest merchant gets better credit than a dis- 
honest one. People are occasionally much impressed 
when a dishonest man succeeds, and think dishonesty 
apt to succeed; but when an honest man succeeds, it 



342 



Tlic Protection of Rights. 



is so much a matter of course that people do not notice 
it. There is much reasoning of that kind: people are 
often so much impressed by what is unusual, and so 
little impressed by what is usual, that they constantly 
overrate the frequency of the unusual, and underrate 
the frequency of the usual — the very fact that a thing 
is rare, makes them believe that it is frequent, and 
vice versa. In spite, then, of an occasional rich rascal, 
there seems reasonable ground for belief that most men 
who get rich, get rich honestly: the criminal classes are 
certainly not the rich ones. 

330 (a), which The cheapness of goods is very much 
makes everybody's affected by the cheapness of getting them 

money go farther, tQ ^ CQnsumer> and that j g affected 

by the honesty of all dealers who handle them, as well 
as of everybody engaged in transportation — cartmen, 
railroad people and steamboat people. And strange 
as it may at first appear, the cheapness of goods is 
affected by the honesty of people who never see 
them at all. The rates at which the farmers and miners 
and manufacturers can produce, and the railroads carry, 
and the merchants exchange, are all affected by the 
cheapness with which their banking business can be 
done, and the stocks of the companies dealt in; and 
that cheapness is of course affected by the honesty of 
the bankers and stock-brokers and their employees. 
In the great business of Wall Street, in many classes of 
transactions easy to recollect, the brokers rely on each 
other's mere word for millions, and so the great expense 
of time and money for written contracts is saved. In 
banks, as a matter of fact, the signatures of checks are 
not examined very much : to examine them closely, the 
expense for officials would have to be doubled. Obvi- 
ously, then, a bank or a stock exchange could not have 
been run as cheaply as it is now, in the days of thieving 
Sparta, or even in those of Shylock; in fact, in less 
honest times, modern industries simply could not have 
been run at all: with less honesty, the enormous com- 
plexity and rapidity of modern exchange was simply 
impossible. Even outside the producing, exchanging 



§33i] 



Personal Property. 



343 



and banking world, the cheapness of goods is affected 
by everybody's honesty: the producers, exchangers and 
bankers have got to depend on engineers and architects, 
lawyers and doctors, and if those men must be paid for 
dishonest work in addition to real work, the expense of 
it must find its way back to the commodities and 
services that everybody uses. In fact, the whole 
working world is so bound together that where any part 
of it goes wrong, all the rest has got to share the expense. 

There is still another portion of the community whose 
honesty affects the price of everything that everybody 
uses. The honesty of the government is important to us 

llnei?' in*ffo C wn- evei T w ^ ere - Every taxpayer must not 
meat, only pay his own direct share of all official 

thievery and carelessness, but even those who do not 
realize that they are taxpayers, must pay in rent, and in 
what are called indirect taxes, which are levied on many 
goods in the hands of manufacturers, importers and 
wholesalers and added to the price when they reach the 
retailer. 

331 and from Next to increased honesty, the most 
creating and 5uo- noticeable agency in diffusing wealth is 
plying new wants, increased variety of production. Tele- 
phones, bicycles, automobiles, electric lighting and 
electric railways, and the hosts of other new things mean 
constant new demand for labor, resulting higher wages, 
and at the same time, new facilities of exchange or 
production, with resulting variety and cheapness of 
product. Fortunately, man is a creature — the only 
one we know — of constantly increasing wants. Those 
who have money to pay out are always more ready to 
pay it for labor on new things, than for superfluous or 
wasted labor on old ones : so there is no need of indus- 
trial suicide by scamping. 

This labor for the* new things of course comes out of 
more wearing and disagreeable pursuits (327, end of note 
from Mallock).* But as there would be no such pursuits 

♦According to the United States census, from 1880 to 1890, 
those in the laborious pursuits of agriculture and the laborious 
and dangerous ones of mining- and fisheries, had decreased from 



344 



The Protection of Rights. 



unless the demand for them were very strong, they must 
have been kept going when labor has left them : that has 
been possible by labor-saving machinery. Of course, 
331 (a) mainly as M )0r leaves the disagreeable pursuits for 
through labor- more attractive ones, the deserted pursuits 
§auing machinery. ca]{ douWy for i a bor-saving machinery, and 
are doubly ready to reward the inventor. Farming, for 
instance, tho healthful, is lonely and laborious. Within 
a generation or two, inventors have given the farm 
machinery that has released a large part of the farm- 
hand labor and sent it into the towns. The labor thus 
released lias done more than merely find employment 
without slowing up the earlier kinds of labor. It has 
made so many new things that it has kept the other 
mechanics on the jump to make enough old ones to 
exchange for them. That is to say, the desire for new 
things — telephones, bicycles, automobiles, mechanical 
piano-players, talking-machines, has made people work 
all the harder to buy them. 

But machinery often releases labor, and still increases 
supply. The world easily gets fitted to the increase of 
supply, because competition to sell the increased supply 
lowers prices so much that people soon use more goods 
of the same kind, or save enough money because of their 
lowered price, to use more goods of other kinds. 

But, it may be asked : How does all this "make work " 
and do away with reason for scamping? Is it not as 
broad as it is long — new things call for labor, labor-sav- 
ing machinery releases it, and the amount of employment 
is just the same as before? The answer is that in most 
cases, labor-saving machinery cheapens goods so that 
several people can buy, where one could before; and 
this increases demand for the old goods, so that makers 
of them soon want back some of their old laborers whom 

46 per cent, of the whole number of persons laboring, to 39.6 
per cent. In domestic and personal service, there had been a 
decrease from 20.1 to 19.2 per cent. While in the more desirable 
pursuits, professional service had increased from 3.5 per cent, 
to 4.2; in trade and transportation, from 10.7 to 14.6; and 
in manufacturing and mechanical industries, from 19.6 to 22.4. 



§33^1 



Personal Property. 



345 



machinery discharged, and often more laborers still. 
001/1.1 Yet while the introduction of labor- 

33l (a), which, . 

tho of some harm saving machinery has always been a 
attheout8*t, blessing to workmen so far as they were 
consumers, in the early days of "the great in- 
dustry" introduced by steam, it threw so many out 
of employment that they had very little to consume. 
Steam-power did not directly lead to the change. 
More directly it was due to inventions like Arkwright's 
loom, Whitney's cotton-gin, and Stephenson's locomo- 
tive. But they could come only after other men of great 
ability had provided the steam-power. But however 
the great industry came, it suddenly produced so many 
more goods with so much less labor, that great numbers 
of people were thrown out of employment until the world 
got fitted to the new state of affairs. Not only was time 
needed for invention to supply new occupations, but 
there was scant communication and travel to get labor- 
ers new places: so the distress was very great. Many 
people thought that inventions were a curse ; and work- 
men, and even sentimental philanthropists, often de- 
stroyed machinery. 

The effect of these circumstances was that for a time 
the poor were getting poorer from lack of employment, 
and the rich richer from the profits of the machines. 
This started the cry of "the poor poorer, and the rich 
richer" which became one of the stock expressions of 
Marx, Lassalle and their school, and is echoed, despite 
• all new facts, to this day. 

The old facts were even so bad that Marx promulgated 
an alleged "bronze" (generally quoted as "iron") law, 
that wages will always be the lowest on which wage- 
earners can subsist — a law often quoted by agitators 
to-day, and approved by audiences with money in the 
savings-banks. 

But in the modern world, increased 
domof wynli*'' communication and travel enable labor to 
circulate freely in search of new employ- 
ment when machinery disturbs old employment, and 



346 



The Protection of Rights. 



[§ 33i* 



workmen are not now opposed to machinery as generally 
or as bitterly as they once were. Many of them more or 
less clearly realize three things, especially the first — that 
a cheapening of most things increases demand so much 
that often as many producers are needed with machines 
as without them ; second, that even if that does not turn 
out to be the case, the discharged people are apt to 
get work in making some new product or cheapening 
some old one ; and third (tho it is realized more faintly 
than the rest) that the laborers themselves enjoy the 
cheapening of product, just as the rest of the com- 
munity does. 

So much for what the general progress of the world, 
outside of the man himself, can do for him. But even 
now, things do not always adjust themselves promptly 
enough to save the poor man the choice between getting 
nothing at all, and getting half what he produces. His 
only protection against being forced to take what he 
can get, is not to be poor; and he can help being poor 
by putting away something whenever he 
weaith A h7mseif Cures can s P are Then he or his union can 
L . sav to anvbodv who wants to hire: "If 

332 (a), by fore- - , - . - . „ 

han.ieJn^s vou won t give what we really produce, 

apainst hard ^ WQrk at ^ yQU 

any chance to make profits/' Yet a man 
would better take a little less in bad times, than go 
unemployed, especially as, in one sense, he cannot pro- 
duce as much in bad times as in good. Of course a 
cloth-mill can run out just as many yards of cloth in 
bad times as in good, but it will not have the chance 
to run out as many, because most things will not sell 
for as much, and some will not sell at all. 

At first it looks as if it should make no difference to 
a man if his own product falls in price when other things 
332 (b). in which fall too » an( * that if ne on ly gets one dollar 

tfe^tend to C kee ! " W l 1Cre l ie USCC ^ to £ et tWO, but Can buy 

tip? while those of twice as much with that dollar, he is just 

luxuries fall. as weU Q fi Rut when prices fall in bad 

times, they do not all fall together. When people have 



§ 332 c] 



Personal Property. 



347 



to economize, they cut off the things they can easiest 
do without : so prices of those things fall ; but the prices 
of things a man must have, keep up pretty well, and for 
them he must pay two dollars where he paid two before, 
even if he gets but one dollar for the sort of things he 
produces himself. Now those things that a man can 
do without, are a larger portion of what is produced, 
than generally realized. Civilization consists almost en- 
tirely in things (and thoughts) that a man can do with- 
out. The savage has all that a man must have. Even 
take tobacco and whiskey — not that they are civiliza- 
tion, but they are things that people can do without, 
and yet they cost the country more than bread and 
meat put together. So, plainly, there must be other 
things that people give up easier than tobacco and 
alcohol. For instance, people can generally be com- 
fortable for a time without new clothes or new furniture, 
or repairing and painting, or giving parties. 

When business is slow, as it is in luxuries in hard 
times, people compete for customers by lowering prices, 
and when times are good, people want so many more 
things, that the supply is apt to be a little short, and 
they compete for them by bidding higher prices. 

And now we come to the great and terrible question: 
What can he who has not the ability to produce much., 
do for himself? 

332 (o. Bu cum- The first step toward a reasonable answer 
oating Ability. j s to realize that the question is partly 
one between him and the God who made him as he is; 
and it is also partly a question between him and him- 
self: for unless a man is an idiot, he can do something 
to cultivate ability. Ability consists largely in knowl- 
edge, foresight, self-control and energy — a man can edu- 
cate himself, think ahead, fight laziness, and control 
all desires that tempt him to seek a small present enjoy- 
ment at the expense of a greater future one. All this 
covers taking care of his health : for if he educates him- 
self in the most necessary knowledge — that of his own 
body, and does not sacrifice the future to the tempta- 



348 The Protection of Rights. [§ 332 c 

tions of the present, and is not lazy, he does take care 
of his health. There is not much danger from over- 
work; but there is much danger from overworry under 
the name of overwork. 

333. Poverty sei- As a matter of fact, it is next to im- 
dom blameless. possible to find a man suffering from 
poverty, if he is educated, forehanded, self-denying 
and energetic. It is only in cases of very exceptional 
misfortune, that distressful poverty is not a man's own 
fault. 

But people want something more than to be merely 
above distressful poverty. And there is hope of a 
man born poor, cultivating so much ability that he can 
make himself very comfortable indeed. Most of the 
rich men were born poor.* Of course it is 

men* bor? poor! ^ arc ^ to te ^ ^ 10W mucn °f their ability was 
born in them, and how much cultivated, 
but it is certain that more of their spare time went into 
studying their work instead of playing, and that more 
of their early sixpences went into the savings-bank 
instead of the beer-pot than was the case with most of 
the men who did not rise. This is by no means counsel- 
ing that nobody should have any recreation while he is 
voung and poor. But the best recreations 
dep 5 Jeteeait^ cost m ^h money; books, music, 

swims, and walks in the parks and fields 
and under the stars, are within everybody's reach, if 
they only would cultivate a taste for them. One should 
consider not his youth alone, but his whole life — how he 
will have the best time by and large. In youth, the 



* Mr. Walker (101 and 227, notes) found that in '78 there were 
one hundred and seventy-six men conducting ten leading kinds 
of manufacture in Worcester, and only fifteen of them were the 
sons of manufacturers, and all but the fifteen began as journey- 
men. (Condensed from Wells.) 

The author once got a city audience of workmen to announce 
what proportion of their employers began as journeymen. 
Nearly all did Tho such facts are too generally known to 
require proof, they are not taken into account by those who 
argue "rich richer, and poor poorer". 



§336] Personal Property. 



349 



wiser men have invested work and study and savings 
which have brought them compound interest later ; while 
those who have indulged themselves unduly while young, 
had no rewards to reap later, unless sickness and poverty 
are rewards. 

336. Wise phiian- Nothing can answer the purpose of a 
thropy necessary more general diffusion of ability and 
to civilization. honesty, not even a more general diffusion 
of human charity: because Nature's law is that a man, 
to accomplish anything, must take care of himself. 
But charity can help if it takes the right directions, 
while it must hinder if it takes the wrong ones. The 
wrong ones are indiscriminate giving to those who 
would consume without producing, as the Communists 
and Socialists propose. The right ones are giving in 
directions that tend to develop ability. The plainest 
of those is educating the ignorant, and relieving the 
sick and hungry, especially such as are apt to try to 
produce for themselves when they are well enough. 

The sick and hungry who are not able to produce for 
themselves — the constitutional paupers, it seems settled 
that somebody else should take care of when their 
relatives cannot. It is often asked : Why should worth- 
less people be taken care of at all? Would it not be 
better to let them die and get rid of them? That is 
Nature's way, and is it not better to follow Nature? 
That might seem the common sense of it, but when 
Nature evolved human intelligence and human sym- 
pathies, she started a way with the unfortunates and 
incapables different from her old way of letting them 
starve; and, somehow, all the nations, like India and 
China, that do let their worthless people die, do not 
succeed in being worth very much themselves; while 
nations like Italy and Spain that go to the opposite 
extreme, and give freely to beggars who could make 
a living if they would, do not come out so very much 
better. With them it is not so much a question of 
helping the unfortunate and incapable, as of encourag- 
ing the lazy. Such countries, of course, are full of 
beggars, and do not get on as well as the countries 



The Protection of Rights. 



n 336 



where everybody has to produce what he lives on if 
he is able to. 

336 (a), it should After finding objections against all the 
continue on pre*- revolutionary social changes that have 
ent nnea. hecn proposed to help the poor, there seems 

nothing to do but what we are doing now, only doing it 
as much better as we can : civilization has been working 
at the problem some thousands of years, and must have 
learned something. Apparently all we can do for the 
lowest type of man is to wash him, doctor him, massage 
him, feed him, exercise him, make as much of a man 
of him as we can, educate him without devoting as 
much time to the most artificial spelling in the world 
as to some decent handicraft, and then turn him loose, 
if he is fit to turn loose, to be farther strengthened by 
the discipline of the world. 

As to the higher type of unemployed, the deserving 
and capable, there are seldom nearly as many of them 
as sympathetic people generally suppose. Most of the 
unemployed do not want to be employed. The "great 
problem of the unemployed" is generally only one form of 
the great problem of the useless and incapable, and with 
the improved adjustments of industry, it is becoming 
more and more so every day, or would be if strikes were 
restricted to reasonable cases. Yet there constantly are 
deserving men whom the shifts and accidents of trade 
are throwing out of employment. The effort should 
be to tide them over, of course, but (more effective 
still, tho, like all reform, slow) to educate them so that 
they will more often anticipate the shifts and accidents 
of trade. But not everything can be done by educa- 
tion. There are often highly educated doctors, lawyers, 
engineers, architects with nothing to do, yet education 
docs help men: the educated generally have more fore- 
thought than men less fortunately brought up, and so 
are apt to have something laid up for a rainy day. For 
all classes of those who have nothing laid up — who if 
they ever had anything, have exhausted it, the Charity 
Organization Societies and Labor Bureaus are doing 



§ 33 6 Personal Property. 



excellent work — better than any government ever did 
or is apt to do. 

We cannot remedy at once all the defects that the 
wisdom of the whole world has vainly attacked for a 
good many thousand years. But we cannot afford to 
throw over all it has succeeded in doing, in favor of 
imaginative untried schemes, especially if they do not 
hold together any better than those we have already 
examined. 

Of course the ideal is a philanthropy 
( on "thne 1 * ent i re *y spontaneous, but there is one con- 
thatcaLot^orh. dition where government should take one 
man's property and give it to another: 
spontaneous philanthropy may not always be within 
reach, tho it is generally where a little sense can find it; 
but government is always at hand, and may properly 
support a man who really cannot support himself and 
has no relatives who can support him. 

While caring for the unemployed is very apt to mean 
caring for the deliberately idle, caring for the unemploy- 
able is already recognized as among the functions of the 
civilized state. And this care of the unfortunate should 
not be restricted to those barely able to keep them- 
selves alive, but should be extended, as far as it can be 
without doing more harm than good, to those unable to 
keep themselves decently alive. Human nature has not 
yet been universally, or perhaps generally, evolved 
beyond the point where the strong will take advantage of 
the weak; and it seems as legitimate for the law to pro- 
tect the weak from robbery under the form of bargains, 
as from robbery under other forms. Of course the diffi- 
culty of doing so without lessening freedom of contract 
and a saving sense of personal responsibility, is very 
great, but the law's cautious experiments toward it 
should be steadily continued, and more caution still 
should be used against the acceptance of quack panaceas. 

Under our civilization, government protects without 
charge against violence and theft, and also assigns counsel 
to an alleged criminal if he is unable to pay for it ; but 
to obtain disputed rights, a man must pay for counsel 



loo ignorant to avail themselves of it. 

There is a limit on what government ca 
for such purposes : it should not take enou 
lazy people trying to protect themselves, or 
able people from producing. 

We have paid much atte 
theiiw? v,nc6 of hopeless absurdity of some 
for helping the poor man t 
law is far from useless to help the less fort 
of mankind. All good laws help everybo< 
the recent appeal to law by the strong agai 
bined aggressions of the weak, the evoh 
has been toward the protection of the i 
the strong. But there is a great differe 
laws to prevent oppression, and laws to 
more than he can produce, at the expense 
else. Such laws, so far as they can be mi 
would simpLy oppress the somebody else, 
a man is living in luxury and idleness an< 
a little oppression for the benefit of less forti 

337 M Cannot fUght be good for him, if it "V 

ditcriminaf *#- for the law to begin oppr 
tvnp.opi.. ^thout going farther and op 

wrong people. 

338. Benevolence . Not only does there seem to t 
does not prevent ac- in history to show that a reas 
cumulating wealth. passion for suffering, even if t 

comes from a man's own weakness and faul 



§ 339] Personal Property. 



353 



the richest men are benevolent, and get rich and stay 
rich, in spite of all they give away. 

At first it looks as if it might be safe to take away from 
a man all that he might have over a reasonably good 
living, but it would stop the usefulness of such men as 
Vanderbilt and Stewart just at the time when they are 
giving employment to most people, and doing the most 
to make everybody's money go farther. Even if a man 
is getting rich by the sort of speculation 

339. Speculation. whkh . g about same ^ fobt)erv> j t 

would be impossible for the laws to select the kind of 
speculation any better than the laws against fraud can 
select it. Yet there is good reason to hope that the laws 
can gradually be improved. 

But there is much more honest speculation than 
fraudulent speculation, and it saves the community a 
great deal of money by anticipating changes and pre- 
paring for them. It is like springs on a wagon. 

If speculation is by deceit and monopoly, of course 
all ill-gotten gains should be restored, but it is not so 
plain that they should be confiscated to public use 
if the robbed person cannot be identified ; and success- 
ful new laws to make it easier to prove gains ill-gotten 
than the present laws do, can be only, as the present 
laws are, the product of slow growth. 

It is often asked : If a man is not active either in pro- 
duction or speculation, but is merely living on a for- 
tune which may have been justly earned, but in fact 
was not earned by its possessor at all — for which he 
never gave the community any return, why not relieve 
him of that excess which does him no good, and put it 
where it will do some? 

• The law could not go into such fine questions as the 
amount of good it does him, or he does with it. But 
even suppose the question "lumped": if a man spends 
a great superfluity even in the best of the selfish ways — 
in fine decorations and other works of art, rare books, 
and all that, why not let the community take that 
money and spend it for the same things, so that many 



354 



The Protection of Rights. 



[§ 339 



men would enjoy them, instead of one man and his 

friends? 

340. Law cannot F ™ one rca f° n ' the community would 
regulate wealth probably spend it very badly. Tammany 
wlsely ' taste, and even Congressional taste, are not 
good, and even that of the Army of the Tennessee regard- 
ing statues has been questioned. 

There is, however, a better reason, al- 
li?aiyze AbfutT ready partly given. Such fortunes, even if 
wisely devoted to the public good, would 
not begin to benefit the public as much as do many of 
the efforts of enterprisers which would not have been 
called forth if the enterprisers could not leave their for- 
tunes to whom they please. Enterprisers would be apt 
to stop in mid-career, if going on involved accustoming 
their children to habits of living which they could not 
hope to keep up. When a great enterpriser is at the 
height of his powers, his ambitions for himself are apt 
to be satisfied. His usefulness is kept up to increase 
the share of his production which he can leave to 
those he loves. 

When we were discussing the general principles of 
rights and duties, we concluded that there is a certain 
balance in things. And it would seem to require that 

341. Duties of while the world is at work, every man 
wealth, should do his share: and as a man who 
has great powers or great opportunities, gets much 
more from the world than mere government conveni- 
ence and police protection, — much more in the way of 
honor and ease than his money pays for, he conse- 
quently owes the community something more than 
merely his share of the ordinary taxes. 

But while we admit that the great enterpriser does 
his share of the world's work when, in addition to pay- 
ing his taxes and being reasonable in his charities, he 
finds work for his less able fellow men, and conducts 
his enterprises honestly and liberally; the rich man 
who is not an enterpriser certainly has his duties too, 
especially in a country suffering, like ours, from having 
in political office too few men who are so rich that they 



§ 342] 



Personal Property. 



355 



"can afford to be honest". A few such men are too 
utlc9 modest (wisely so, in some instances) to 
(a. npo a. ta ^ e office, but most of them prefer to 
amuse themselves, all of them hate to associate with 
the low type of politician we sometimes elect, and — per- 
haps the strongest reason of all — our people are not 
fond of electing rich men of leisure, unless they started 
in the ranks; and even then, in too many cases, unless 
the candidates are ready to pay for it. They should 
not pay for it, because there is enough bribery of bosses 
and of voters already. True, to be useful in politics, 
a man need not necessarily take office: he can study 
politics and public men so as to know good from bad, 
he can support the good and oppose the bad, and help 
educate the people to do the same. 
341 (b) in charity tnere are other ways than politics 

and education or in which a man of leisure can reciprocate 
even in sport. w ftat the community is doing for him — 
there are all sorts of charitable and educational and 
artistic institutions, and necessities for new institutions, 
that need his time even more than they need his money. 

If the best he can do and all he can 
mOT'perulilrfy'ob. 011 do » is to amuse others while he amuses 
iMous of public himself — in horse-races, yacht-races a*nd 
similar amusements, he cannot be regarded 
as useless, even if he does not avoid the palpable danger 
of such sports. But compared with other countries, 
America does not get her share of service in politics, 
charity, education, public improvements, the arts, and 
even amusement, from her men of leisure: in older 
countries, such duties are matters of course in the edu- 
cation of the more fortunate classes. But here, as we 
are all free and equal and govern ourselves, our need 
of a class to attend honestly and energetically to politics, 
is much greater than the need in the older countries: 
we govern ourselves very badly. Tho the Old World 
sometimes sends us a Carl Schurz, a Godkin or a Franz 
Sigel, we are still the dumping-ground for its refuse 
population; and we have no class of hereditary poli- 
ticians and men of public spirit, and no long and 



356 



The Protection of Rights. 



[§ 342 



wealthy past sending us a rich inheritance of charita- 
ble, educational and artistic institutions. The Ameri- 
can man of leisure who satisfies himself by merely giving 
money, neglects his other duties, and devotes himself 
to mere selfish sports and luxury, is just as much more 
blamable than the European one, as our civilization is 
younger and less developed than the European one. 

A man, rich or poor, anywhere, who does 

rich , man e a M n0t ^° ^ S * a * f snare °^ * ne world's work, 

"dependent". is simply one of 41 the dependent classes " — 
he depends on others while giving no ade- 
quate return. His money may be in one sense an ade- 
quate return, but unless he made it himself , he is merely 
dependent on the man who made it, whether that man 
be alive or dead. Dependence does very well for 
women and children, but it is disgraceful in a man. 

No American has surpassed in wisdom or benevo- 
lence, the one who summed up this whole subject of 
the distribution of wealth in the following winged 
words : 

"Wealth brings with it its own checks and balances. 
The basis of political economy is non-interference. 
The only safe rule is found in the self-adjusting meter 
of demand and supply. Do not legislate. Meddle, 
and you snap the sinews with your sumptuary laws. 
Give no bounties; make equal laws; secure life and 
property, and you need not give alms. Open the 
doors of opportunity to talent and virtue, and they will 
do themselves justice, and property will not be in bad 
hands. In a free and just commonwealth, property 
rushes from the idle and imbecile to the industrious, 
brave and persevering." — Emerson. 



BOOK IK 



THE PROMOTION OF CONVENIENCE. 



CHAPTER XXIV. 

PRELIMINARY SURVEY. 

So much for government's protection of rights. We 
saw that its other general function is the promotion of 
the people's convenience. Yet while we have been dis- 
cussing the state's relation to rights, it has come in 
our way to touch upon some conveniences — when we 
were treating of natural monopolies, we mentioned 
roads, bridges and ferries, railroads through country 
and city, water and gas supplies, sewer connections, 
and the development of extraordinary mines, springs 
and scenery. 

As we know, some of these things are objects of 
attention by all civilized governments. So are many 
other conveniences — chief among them, money, educa- 
tion, postal service — which in Europe often includes 
the carrying of telegrams and packages — surveys and 
maps of the country, harbors well dredged, protected 
and docked; lighthouses, coast life-saving stations, 
parks, museums, libraries, almshouses, asylums and 
hospitals. The things enumerated in this paragraph are 
provided by all civilized governments. Some govern- 
ments also provide superintendence of public health, 
electricity, gas, public baths and lavatories, pawnshops, 

357 



3S« 



The Promotion of Convenience. 



concerts, lectures, houses for the self-supporting poor, 
and cemeteries. 

These things are not generally gratuitous, however, 
even in the sense that taxes pay for them: persons 
using money, railroads, mails, harbors, water, light, 
cars, ferries, houses, and cemeteries for their dead, 
generally pay for them directly. 

A century ago, hardly any government took care of 
any of the things named, except money, roads, light- 
houses, harbors, and, in a very limited way, mails and 
parks. Even then the parks were hardly public parks: 
they were rarely more than the pleasure-grounds of 
rulers and rich people, occasionally thrown open to 
the public. The great parks which everybody can en- 
joy at all times were almost unknown. 

Regarding some of these conveniences, great differ- 
ence of opinion prevails as to whether government 
should supply them, or leave people to do it for them- 
selves. As to those that all civilized governments 
supply, we may as well consider debate closed, at least, 
as regards the wisdom of government supplying them. 
But even of them, there are some on which there is 
great debate regarding what kind and how much, 
especially regarding money, treatment of the defective 
classes, roads in their new forms of railroads and street 
railways, and sundry minor matters. 



CHAPTER XXV. 



MONEY. 

General Considerations. 

We can begin with a topic that has, at least, one 
easy side. Of all the items enumerated, probably the 
earliest supplied by government, and the one where 
government agency is most taken for granted, is money. 
The use of our spending any time now on money ques- 
tions may be doubted, as it may be claimed that 
the Act of March, 1900, (not to speak of the elec- 
tions in November of that year and in 1904,) dis- 
posed of them all, as far as this country is concerned. 
344. Reasons for But Mr. Bryan's followers did not seem to 
studying money, think so, nor does the Honorable Tom 
Watson. Money questions will never stay disposed of, as 
long as the vast majority of mankind are of low produc- 
ing power and low intelligence. So long, men will try 
to better their condition by tricks with money, land- 
tenure, government control of production, frequent 
strikes — all of the old schemes to get something out 
of nothing, but with hosts of new faces. 

Moreover, another reason why the Act of 1900 did not 
finally settle all the questions, is because it did not 
touch them all, as we shall see. 

For three reasons, it is very important for the citizen 
to understand the government's relation to money. 
First, because meddling with money questions by the 
ignorant has caused this country and most countries 
some terrible disasters — this country, perhaps, worst 

359 



360 



Tlie Promotion of Convenience. 



[§ 344 



of all, because here the ignorant have most to say. 
Second, because money questions come more directly 
home, literally to each man's pocket, than any other 
questions which government affects. Third, because, 
for that very reason, people are apt to suppose they 
know all about money questions, and are therefore less 
apt to leave them, than questions of the post-office, 
the coast-survey and lighthouse board, and the admin- 
istration of war and justice, to be settled by people who 
really know. 

Even the administration of justice is hardly a more 
important government function than issuing money. 
True, justice is more important in a general sense than 
money: but nothing works more against justice than 
ignorant tampering with money. Money touches every 
man, while not one man in fifty ever gets into court; 
and when he does, he soon finds that he does not know 
anything about law. But nearly every man has a 
little money, and so seems to think he knows all about 
that; and apparently, if he has none at all, he is still 
more apt to think he knows all about it. 

345. Barter and Now, to begin with the simplest aspect 
Money, of the subject, if there were no money in 

the world, and a farmer wanted a hat, and his wife 
a frock, and his child a pair of shoes, he would trade 
off for them at the store a load of potatoes or any avail- 
able thing he might have. The usual name for such 
dealings is barter. It is customary only before people 
become civilized enough to have money. Yet the 
farmer might go around long before finding a shoe- 
maker who wanted just potatoes enough to pay for a 
pair of shoes, and a hatter who would take just potatoes 
enough to pay for a hat, and a dry-goods man w T ho 
wanted just potatoes enough to pay for a frock. More- 
over, as the city storekeepers do not generally bother 
with such dealings, the farmer might spend a w r eek. 
perhaps, without finding one who would. They w r ould 
all laugh at him for asking them to. 

Still, of course all this trouble would be necessary 



§ 347] Money — General Considerations. 361 



only if we had no money. Now as we have money 
the farmer naturally takes his potatoes where they buy 
potatoes, and then takes his money where they sell 
shoes or hats or frocks. So the mere fact that we 
have money, would save him as much troble as, 
probably, his potatoes cost. On considering this 
in regard to all sorts of dealings, one gets some idea 
of the very great usefulness of money. 

346. Swindling by Suppose, tho, that our farmer got paid in 
money. poor money? then he could not do any- 
thing. But as any man giving another poor money de- 
ceives him and robs him, what is to be thought of a 
man who tries to make all the money in the country 
poor? Plainly that he would attempt the greatest fraud 
that can well be conceived of, and do a frightful deal of 
harm. And yet at the height of what we Americans 
fondly believe to be the highest civilization yet attained, 
many well-meaning men have attempted that gigantic 
fraud, from ignorance; and many others from dishonesty. 

347. Kinds of I* 1 the United States we use many 
Honey, kinds of money — paper, gold, silver, nickel 
and copper. The Chinese, Spartans and a good many 
other nations have had iron money. The American 
Indians used wampum for money; and they also, "as 
well as our New England ancestors, used discs of shell. 
The fur-traders near our northern borders, and many 
other people, have used skins. Tobacco too has been 
used, and so have wheat and corn; and in Africa, 
cattle and even slaves have been used as money, and 
called live money, as distinct from other kinds, called 
dead money. 

We give all these things the same name — money. 
Now all things that can have a name in common, must 
have at least one quality in common, but they need 
not look alike, any more than all things we call food 
look alike. The very different things we call food, 
can all be eaten, and will all help keep the body 
alive. 



362 



The Promotion of Convenience. 



[§34» 



•348. Qualities of So a ^ tne things that have been called 
all money. money, have the quality in common that 

wherever one of them is used as money, people will 
give nearly all other things for it. 

But some people will give nearly all other things for 
a check on a bank, or a promissory note. Yet they are 
not money, because people generally will give other 
things for money, while for checks and notes, other 
things will not be given by people generally, but only 
by people who know all about the checks and notes, 
and have confidence in them. 

Another difference is that if a check or a note turns 
out at any time not to be good, the person who last 
received it usually has a right to demand that the per- 
son who paid it shall make it good: that is one reason 
for wanting to know if the person signing is solvent. 
But if money is what it appears to be when it is paid, 
the debt is discharged once for all. If, for instance, a 
bank breaks, or a government is overthrown, those who 
have any of its money cannot require the people from 
whom they received it, to make it good to them. Of 
course counterfeit money is not included in this condi- 
tion : counterfeit money is not money at all — not even 
bad money, any more than a portrait is a person. But 
real money may turn out bad: government notes are 
real money, but they would be worth no more than 
paper if the government did not pay them. So a silver 
dollar of the present weight is real money, but it would 
be worth but fifty cents if the government would not 
give a gold dollar for it. So bad money can be legal 
tender, and a man be legally obliged to take it: the 
treasury notes now in circulation are not good money, 
because they are not expressly payable in gold, yet 
they are legal tender; and bad money was made legal 
tender all through the civil war, and for years after it, 
until in 1879 government made the money good by 
being ready to give gold for it. 

When a creditor accepts a legal tender 
MLWai a TeK y (210-2 [o/>) the debtor is legally free from 
farther liability, even if the money should 
turn out bad, unless it is counterfeit. 



§ 3S 2 1 Money— General Considerations. 363 



Now we are ready to pack our characterizations of 
money into a portable definition: 

350. Definition Money is anything for which substan- 
reached. tially all the people in a community will part 

with anything tliey are willing to dispose of, and which dis- 
charges forever tlte debt for which it is received. 

Broadly considered, money is simply power con- 
veniently arranged in units. A hundred dollars is a 
hundred units of power controlling most of the things 
that men generally care for. After men have enough 
money to satisfy all material and aesthetic wants, they 
crave more because they want more power. The great 
bankers often control the policies of nations. But 
it should not be forgotten that the great philosophers 
control them more often, and for centuries after the 
bankers are dead. 



Usually the most noticeable difference 
buys less than good, between good and bad money is that for 
' anything they have to sell, people want 
more bad money than good money. For instance, when 
our New England ancestors began using discs of shell 
for money, at first people would take a few of them as 
pay for ordinary purchases; but soon, so many discs 
were made that nobody would sell a thing for any amount 
of them. The same way during our great civil war: 
people North wanted at one time nearly three green- 
back dollars for a thing that they would take one gold 
dollar for, and people at the South wanted a hundred 
Confederate paper dollars for anything they would sell 
for one gold one, and at last they would not sell things 
for the paper dollars at any price. But people sell 
the same thing now for a United States paper dollar 
that they will sell for a gold one. 

These great differences in the value of 
L 5 n 2 : P ™fj" paper dollars have arisen because the 
value of paper dollars depends upon the 
chance of getting gold ones for them. A note of a govern- 
ment or of a bank has no magic about it, any more than 
the note of an individual, even tho the government 



364 



The Promotion of Convenience. 



[§35* 



note does have more pictures over it, and the pictures 
do fool the ignorant. It is but a piece of paper contain- 
ing a promise to pay, and all its value beyond that 
of the pictures, is in the reliability of that promise. 
Now you can get a gold dollar for a paper one at any 
moment. During the civil war you could not, and it 
was very uncertain when you could; and the value of 
the paper dollar varied with that uncertainty until at 
times it was but forty cents in gold. The uncertainty 
was greater regarding a Confederate paper dollar than* 
a Union one: so the Confederate dollar was generally 
worth less than the Union one, and finally it became 
certain that you never could get a gold dollar for a 
Confederate paper one, and the paper ones were worth- 
less. 

Tho a paper dollar is money, people often prefer a 
gold one, not merely because a paper dollar will soon 
wear out, but especially because, if a paper dollar 
should not be useful as money, it cannot be put to any 
other use worth a dollar. It would only be used as a 
picture, generally a pretty poor one, or as paper pulp to 
make new paper, and it is not worth a tenth of a cent 
for that purpose; while the gold in a gold dollar can 
be put to a thousand uses, any one of which is worth a 
dollar — in short, a gold dollar is worth a dollar, and a 
paper dollar is worth nothing except as a promise to pay 
a dollar; and hoiv much that promise is worth, depends 
upon how likely it is to be kept. 

353, Flat Money, Money of no intrinsic value is called 
Token Money. fi a t money: fiat is the Latin for let it be. 
Fiat money is money only because the government 
says: "Let it be money." It is also sometimes called 
token money, just as a gambler's counters are tokens 
to be redeemed in money valuable in itself. 

354. Redemption Money valuable in itself, which redeems 
Money. f ia t money or token money, is called re- 
demption money. A gold dollar will be taken almost 
anywhere for about the value of so much gold, because 
somebody near at hand can use it as so much gold. 



§ 354] Money — General Considerations. 365 



But a paper dollar will not be taken at full value in a 
country where it was not issued, because nobody can 
use it there for anything but old paper, and it must 
be sent home for redemption. If you were in London 
with a pocketful of greenbacks and nothing else, you 
could not buy anything until you had hunted up a dealer 
in foreign money, and sold him your greenbacks at 
enough discount to pay him to send them here and 
get the gold back. Even if you had American gold 
instead of greenbacks, the shopkeepers would not 
generally take that, but you could find ten people who 
would, to one who would take greenbacks. Only a 
few special dealers would buy the greenbacks; almost 
any banker or large shopkeeper would take the gold, 
tho at a discount, but a very trifling one compared with 
that on the greenbacks. Within a block, somebody 
would be ready to put the gold into the melting-pot and 
use it for making jewelry or gilding or something of 
that kind; or the English mint would take it and coin 
it into their money. But nobody could do anything 
with the greenback except send it to America and wait 
for the gold, and pay expenses both ways. Therefore, 
paper money never could be quite as good as gold 
money for foreign trade. 



CHAPTER XXVI. 



MONEY (CONTINUED). 

Some American Experience. 

355. How paper As already said, during the civil war, 
money cheated greenbacks became worth only forty cents 
creditors. on a d u ar| an d a result was that if, 

when the war broke out, a man owed a dollar pay- 
able in two or three years, he could then make his 
creditor take forty cents for it. That was just what 
hosts of people did, and what hosts of people, during 
the Bryan campaigns, wanted to do; and still want to 
do, by getting a chance to pay irredeemable silver dol- 
lars where they have borrowed gold ones. During the 
war, the transaction was somewhat disguised by the 
pieces of paper being marked as worth dollars, and 
people began taking them before they began to depre- 
ciate. Moreover, it was not the fashion to speak of 
them as going down in value, but of gold as going up; 
and what was more important, people endured it all 
cheerfully, so as to enable the government to use the 
bad money to carry on the war. The government made 
bad money, partly because most of our rulers at 
that time had had little occasion to study finance, 
and knew no better. Government needed money at 
once to pay the expenses of the army. So, rather than 
incur the delay and expense of borrowing, they thought 
it the simplest thing to issue promises to pay, which 
were our present greenbacks or their ancestors. 

As this money was legal tender, and people had to 

366 



§ 357] Money — Some' American Experience. 367 



take it, a little explanation may be needed to show 
how it could get bad. People did not need to sell 
355 (a), and things for it unless they got their own 
raised prim. prices. Therefore, as government kept 
on making more of it, and people began to lose con- 
fidence in it, they put up prices, including the price 
of gold, so that a man who wanted a gold dollar to 

356. " Never mind P a y a debt in Europe, soon had to pay 
"rope." f or it over two dollars and sixty cents in 
greenbacks. 

357. Effect of * n the vears *93 anc * *94 depreciated 
money not payable silver made a difference to the American 
,n g0,d ' people of a seventh of all their property 
— three times as much as the civil war cost — 
about ten thousand million dollars — nearly a hundred 
and fifty dollars to each man, woman and child in the 
United States. True, many men, women and children 
never had a hundred and fifty dollars, but a good many 
of them might have had it in wages, in those years, 
who did not get it because our money was not good 
enough for all foreign purposes. But of course refer- 
ence was made only to the average loss — some men 
lost millions, many men lost thousands, nearly every 
laborer in the land lost heavily in wages, but perhaps 
a few people lost nothing, and some even gained — a few 
largely. 

Notwithstanding that for more than twenty years 
before '93, you could get a gold dollar for a paper one 
or a silver one, our money was not, during those twenty 
years, what it should be abroad or even at home, as 
the events of '93 abundantly demonstrated. Wise 
people were afraid that in a short time they could 
not get a gold dollar for a paper one or a silver one, 
and ran business at very low pressure in consequence. 
The fear existed because very few of our paper dol- 
lars were actually made by law payable in gold: most 
of them were payable either in silver or in "coin", 
which is either gold or silver; and there got to be so 
many of these dollars out, that people began to fear 
that if any mishap like a war or a panic should reduce 



368 



The Promotion of Convenience. 



[§ 357 



the government's revenue, it would not have gold 
enough to be able to pay such paper dollars in any- 
thing but silver. Moreover, none of the silver dollars 
were made by actual law payable in gold, and per- 
haps we might not have been able to get gold enough 
to pay them if they were. 

Our silver dollar is only token money (353). It really 
contains only fifty cents' worth of silver, and if our 
paper money were redeemed only in it, and it were 
not redeemed in gold, our silver dollars might easily 
go the way the greenbacks went during the civil war. 
We are really saddled with two kinds of doubtful money. 
358. Why the There is only fifty cents' worth of silver 
sliver dollar has in the silver dollar because when the 
depreciated. amount was settled upon, silver was worth 
much more than now — the amount put in the dollar 
was worth about a gold dollar then. But since then, 
especially from '79 to '93, the production of silver has 
been greater than that of gold, and the price has come 
down with a run. Not only has the increased amount 
lowered the price of silver, but there has also been a 
great decrease in the uses for it. For some time pre- 
vious to the publication of this edition, it has been 
rising, but not enough to materially alter the conditious 
herein stated. 

When there is a great deal of anything, or people 
have little use for it, it is cheap — what people cannot 
use, they will sell low. 

The great decrease in the uses for silver was mainly 
due to a large part of the world abandoning its legal- 
tender quality for large sums. Soon after the uniting 
of the German states into an empire in 187 1, the empire 
wanted to make a new uniform money system to take 
the place of the old differing systems of the various 
kingdoms, and it concluded to make people pay their 
large debts only in gold. So a vast amount of old 
silver coin was thrown out of use, and put upon the 
market merely as silver. The effect was the same 
as if a corresponding weight of silver table service had 
been thrown on the market : silver became so cheap that 



§ 360]* Money — Some American Experience. 



369 



soon Belgium, Holland and France stopped the yearly 
increase of their silver money, which they had been 
making for a long time. That left still more silver in 
the general market. They did that to keep out of the 
very scrape that we ran ourselves into by not doing it 
— by having so much depreciated silver coin on hand 
in 1893 that the danger of not being able to redeem 
it in gold brought on the terrible financial panic. 

In 1873, some of our own wisest statesmen, antici- 
pating the wisdom of France, got a law passed discon- 
tinuing the use of silver for payments above five dollars. 
But that did not throw much old coin on the market, 
because we were not using much. But our example 
added force to the examples of France and Germany. 
In June, '93, India, the greatest silver-coinage country in 
the world, stopped coining silver, the price went lower 
than ever before, and that helped precipitate our panic. 

359. Why coins When the price of silver came down so, 
were not made our government did not put more of it in 
heavier. ^ dollar, so as to keep ft worth a gold 
dollar. It is always hard for government to do a new 
thing, because so many people have to get together 
and agree, and in this case people interested in silver- 
mining opposed using twice as much silver for a dollar, 
altho it would have increased the demand for their 
metal. For one reason, they thought it better to work for 
the repeal of the law passed in 1873, which had dimin- 
ished the use of silver as money, and so had diminished 
the demand for their product. Therefore they wanted 
silver again made legal tender for all debts, large and 
small; and in spite of all we have seen, they succeeded 
in recovering again for their light-weight dollar, the 
legal-tender power that had been taken away in '73. 
In '78, they got a law passed making the light-weight 

360. American Re- dollarS le S al tender > and requiring the 
monetization in government to coin from $2,000,000 to 
'78 and '90. $4,000,000 worth of silver bullion a month. 
The smaller sum alone was coined, resulting in an aver- 
age of about $2,500,000 in money. Government received 
these dollars for taxes, but was not under obligation to 



370 The Promotion of Convenience. "[§ 360 

redeem any not needed for taxes. In 1890 the coinage 
was made to depend, after July 1st, '91, solely on the 
government's need of money, but the treasury was obliged 
to buy four million five hundred thousand ounces of 
silver a month, whether it coined the silver or not, and 
to issue "treasury notes " in exchange for it. These too 
are receivable for all public dues, and are legal tender, 
but they are redeemable only in silver dollars, which are 
also legal tender. Making coin worth but fifty cents, 
legal tender for a dollar, would be swindling creditors 
just as badly as they were swindled by the forty -cent 
greenback during the civil war, if the coin was worth 
only fifty cents; but it is token money (353) for a dollar, 
and as long as redeemable, is of course worth a dollar. 
But, as already said, it may not always be redeemed. 
Whatever silver had to be coined » was not put into 
dollars heavy enough to be each worth a dollar, 
partly because people generally did not know the dan- 
gers of light coinage; and some who did, would gladly 
have risked them, and have exposed the whole coun- 
try to them, for the sake of selling their silver. So 
they professed to attribute the panic to thousands of 
other things; they even hired pamphleteers, speakers 
and newspaper writers to befog the people and make them 
clamor for "cheap money for the poor man" — a light- 
weight legal-tender dollar rather than one of full value. 

They could get enough people to vote 
?ooiinJthe r ig?^a!It. for such a thin g because majorities are nat- 
urally ignorant on new questions, and in 
this case they were fooled by the argument that cheap 
money is good for the poor man, because he can get 
more of it for a given amount of labor. Many people 
were led honestly to believe this an advantage; but 
also many owing debts hoped to pay them in light- 
weight dollars, which, if the government would not 
redeem them, could be had for fifty cents' worth of work 
or product. They did not see that if one man gets the 
cheap money easier, other men get it easier too; in 
other words, the man has to pay it out easier — just as 
much easier as he gets it. So he gains nothing. 



§362] Money — Some American Experience. 371 



On the other hand, all creditors lose; and for every- 
body, it works like such schemes as scamped labor (2286) 
or mistaken taxation (464). All those who produce 
goods at first hand, like farmers and miners, get money 
easier only for their own work, but they have to pay 
it out easier for all work which they buy, with its 
added cost in reaching them through many hands. 
As an illustration, suppose that, under cheap money, 
a copper-miner wants to buy a copper kettle. True, 
he gets an inflated price for the amount of copper in it, 
but he has to pay back the same inflated price for 
that amount of copper, and, in addition, to pay inflated 
prices for carrying the copper to the smelting-furnace, 
rolling-mill, kettle-factory, wholesale dealer, retail 
dealer, and at last to the user himself. Moreover, he 
has to pay inflated prices for every mechanic and 
exchanger who touches it on the way. Inflated cur- 
rency not only always inflates laborers' wages, but 
inflates the half-dozen profits on everything on its 
way from the farmer or miner or lumberman, through 
the manufacturer up to the retailer, so that when 
the laborer takes his inflated wages to buy his supplies, 
he finds the supplies inflated vastly more than his 
wages are. Hence the people who agitate most for 
rag money and light money, are the very ones who 
would suffer most from it: a laborer gets an inflated 
price for his own one process, and has to pay inflated 
prices for a dozen. The case is something like that 
of scamped labor (228 b). 

If cheap money makes all these people pay more 
than they get, it is not easy to determine precisely 
who makes the excess — whose is the profit. 

362 Whoorofits * n ^ e case °^ s ^ ver » apparently some 
bv light-weight of it would have to go to inflated wages 
silver? £ Qr silver -miners, because owners of 

mines would bid for more of them; and certainly 
much of it goes to their employers and the money- 
changers — just the very people that a dishonest voter 
would think he was going to cheat by paying his debts 
in cheap money. The employer who pays out a thou- 



372 : The Promotion of Convenience. [§363 



sand dollars a day, would seem likely to benefit more 
by cheap money than the man who pays out only two 
or three. 

The debtors who can cheat most with cheap money, 
are not, after all, generally the poor and ignorant. That 
is another place where the latter fool themselves or 
are fooled. The people in debt are of course those 

363. The poor are who . have the P ro P ert Y» intelligence and 
not the debtor character needed to get credit. But that 
class * class has not furnished most of the votes 
for cheap silver: most of the votes for cheap money 
and for all other attempts to make something out 
of nothing, come from the ignorant and irresponsible 
people who are always in poverty, and always ready 
to listen to any deceptive promise of a short cut out 
of it, like socialism or communism or magical taxation 
or trade-union coercion or cheap money. 

Another argument that got votes for making light- 
weight silver dollars legal tender, was that silver is 
naturally the money of the poor because it is cheap, 
and gold the money of the rich. There is no truth in 
oc . , this, nor would it be of anv consequence 

364. nor the class . . . _ . . , - 1 , 

that handles least if it were true. It is simply an appeal to 
g0,d ' blind prejudice. As a matter of fact, 

while poor people have to buy for cash, people rich 
enough to have bank accounts usually buy on monthly 
or quarterly account, and usually pay those accounts 
and all considerable debts with checks, and their small 
ones in silver change; it is quite probable that they 
do not use as much gold as people a shade worse off. 

Now that we have considered the mak- 
oP93T hepanlc m % °f s il yer > legal tender again, and coin- 
ing more of it, and the dangers of doing 
so, let us see how all that brought about the panic 
of '93. 

The silver which the government was forced to buy 
(360), was paid for either in notes from the treasury, 
which were promises to pay "coin", and which the 
government might redeem in silver; or in certificates 



§ 3^5 b] Money — Some American Experience. 



373 



that the treasury had received and would pay back 
silver dollars. These were also paid for any silver 
that people might be tired of carrying around. These 
notes and certificates were not good money, but for 
the time they served the purpose, because even if the 
government paid silver dollars for them, it was ready 
to pay the silver dollars in gold. The trouble was 
that there got to be so many of the treasury notes 
and silver certificates, that people grew afraid that 
the government would not long be able to pay gold 
for the silver dollars which the paper represented. 
365 (a). Begins The ^ rst noticeable effect was that 
with alarm in people in Europe who owned our bonds 
Europe. an( j stocks, got frightened lest soon they 

might not be able to get gold for them, and began to 
send them here for sale. Those "people in Europe" 
had invested money here with our corporations, to 
build railroads and open mines and do many other 
things, or had lent us money to carry on the War for 
the Union. When they got frightened lest they should 
be paid in silver, and sent the stocks and bonds back 
again to be sold, a large part of the money paid to 
the brokers for the bonds was treasury notes and silver 
certificates. These would not be taken in Europe: so 
importers went to the treasury for gold. People here 
soon began to join in the fear of the foreign bond- 
holders that government could not continue to pay 
gold, and, remembering the war experience with the 
greenbacks, began to expect that the silver dollar 
and most of the government paper money would fall 
in value, so that a man with a dollar due him could 
really get but fifty cents. 

365 (o). Busintsa This made business dull, loans difficult 
suffers, an( j mone y scarce. A large share of busi- 

ness is done on borrowed money and credit sales, and 
people were afraid to lend a dollar or give credit for 
one, when there was a large chance of getting only 
fifty cents back. This led to the stopping of many 
works, shutting of many mills, and dullness among the 
dealers. All this threw many people out of employ- 



374 



The Promotion of Convenience. 



[36S D 



ment. True, the bankers and merchants could have 
lent gold and sold goods tinder an agreement to get 
back gold, but people will not bother with such details in 
365(c). Kansas ordinary transactions, and moreover, the 
tries a 'new wag state of Kansas once declared such agree- 
of "Meed n 9 . ments illegal, and other states might do 
the same: so people did not like the risk. Moreover, 
when business is bad, people who really want to pay 
back just what they get, may not be able to. 
365 Hoarding Not only was business dull, but money 
begins. was sca rce. Many people getting money in 

hand, did not put it in business or in the banks, where 
it could be lent out, but locked it up. They were 
afraid that the banks might be able to get back only 
light-weight silver dollars where they had lent gold 
ones, and would break; and people also feared that 
if they did not put the money in banks, but bought 
property, if business got disturbed by poor money, the 
property might shrink in value so that they could 
not get the money out again. 

It is by no means exclusively the 
™¥the£o\ bank * money of the rich that goes if the banks 

fail. A large part of all the money in 
banks, is in the savings-banks, and that is almost entirely 
the money of the poor (141). 

Popular fear for the safety of banks and investments 
grows with what it feeds upon, until it becomes a 
regular panic, when people are so afraid of a fall in 
prices, that they begin to throw away their stocks and 
bonds for anything they will bring. In the panic of '93, 
people threw away their stocks and bonds at great 

sacrifices. The President called a special 
Ito^m'PiT* session of Congress, and, after great trouble, 

got enacted a law repealing the require- 
ment passed under the previous administration, that the 
treasury should buy four million five hundred thousand 
ounces of silver a month. 

The absurdity of the repealed law has been strikingly 
illustrated in the fact that notwithstanding the increase 
in population and business — the latter especially after 



§366] Money — Some American Experience. 375 



1903, the supply of silver that the government had 
accumulated before it stopped buying in 1893, obviated 
the necessity of buying any more for the mints until 
August, 1906. 

Tho that silver was lying idle in the treasury, in a 
sense it was not idle: for, being paid for in notes of the 
treasury, it was a guarantee for these notes (378). But 
its fluctuating price made it a very unsteady guarantee, 
and each month's purchases of silver increased the notes 
and, consequently, the danger that they could be 
redeemed only in the silver. Such uncertain banking 
showed our government to be controlled either by 
lunatics or by men who would stop at nothing to sell 
their silver, and this did as much to hurt our credit, and 
lead the Europeans to sell our securities, as did the 
mere fear that the treasury could not pay gold for all 
its notes. 

Stopping the silver purchases stopped the panic. In 
spite of the blows business had been stunned by, within 
three months people, from their hoards, increased the 
money in the national banks ten per cent., not to speak 
of what went into savings-banks, state banks and private 
banks; but even after President Cleveland stopped 
the panic, business did not revive for a year or more, 
until he had been obliged to buy gold at heavy rates 
to pay government notes with, and pay for the gold in 
government bonds, and had satisfied people that he 
would do so whenever necessary. Then factories started 
up, wages increased, wheat and cotton advanced in 
price, and everything looked hopeful. 

Yet it was frightfully expensive for 
hlaJycoit^ President Cleveland to redeem the token- 
money with gold bought by government 
bonds. But he did it because the notes were out, 
366. Government and Congress was not wise or honest 
Banking. enough to pay them off and burn them up. 

Consequently when anybody wanted gold for foreign 
shipment or the arts, instead of going to a dealer for 
it, and paying a little commission, he went to the govern- 
ment and got it without commission — that is to say: 



37& 



The Promotion of Convenience. 



t§ 366 



at the expense of all the people. In other words, it 
was at the expense of the people that the greenbacks 
were kept in circulation, in order that government 
might do, without charge, the business of the very 
"goldbug" that the ignorant voter so hates. 

The law does not directly oblige the government to 
do all this brokerage business. But it was not avoided, 
because it was much less expensive to do it than it would 
have been to repeat the panic of '93. We have had to 
pay for letting people who had silver for sale, fool 
ignorant voters into the belief that if they would only 
use half the value of silver that they did of gold, in a 
dollar, they could have twice as many dollars, and all 
of them just as good. 

The hopefulness occasioned by Mr. 
367. "16 to 1." Cleveland's policy, continued until the 
silver men again began to agitate for the 
presidential election of '96, and to demand unlimited 
coinage of a legal-tender dollar, whose weight should 
bear, to that of a gold dollar, the ratio of 44 16 to 1 
This they made their campaign motto. The ratio of 
actual value was about 32 to 1. Fear of the success 
of this scheme made things dull again. Its defeat 
restored confidence, and the country entered upon the 
greatest period of prosperity it has ever known — one 
that even the Spanish and Philippine wars could inter- 
rupt but for a moment. But even the defeat of the 
silverites in '96 did not restore confidence immediately, 
because the treasury gold for redeeming silver dollars 
remained for some time scant; and the laws were so 
indefinite that the government might be thrown upon 
a silver basis by any great financial disturbance, such 
as those Mr. Cleveland had issued bonds against. People 
felt afraid to invest dollars worth gold, in enterprises 
that might pay them only dollars worth silver. So 
business continued dull until 1898. Then the enormous 
mechanical genius of our people had been gradually 
enabling us to send Europe many manufactured articles 
cheaper than they could be made there. Altho our 



§ 369] Money — Some American Experience. 377 



high tariff makes prices here higher than in Europe, 
many of our manufacturers are selling to Europe at 
low prices, because they must compete there. Yet they 
sell here at high ones, because the tariff shuts out 
European competition, and puts the difference collected 
out of our people, into the manufacturers' pockets. 
All this is despite the elaborate theory worked out 
when we were treating of distribution — that competi- 
tion and weak producers keep prices down, and it well 
illustrates one beauty of "Protection": to the extent 
of the duty, and at the expense of the rest of the people, 
the government "protects" the manufacturer from the 
necessity of competition, and the danger of incom- 
petency; but at the same time it "protects" (?) the 
public from the advantages of competition (146-148 d) 
and makes us more open to the dangers of incompetency. 

368. Improved ^ ut to return to our light-silver-dollar 
trade balance experience. Business confidence began to 
supplies gold. appear again in 1898. Despite the danger- 
ous state of the law, two causes sent us enormous 
quantities of gold : our manufacturers had begun to sell 
increasing quantities in Europe, and we had enormous 
crops in '97 and '98 which a scarcity in Europe compelled 
people there to pay us high prices for. These agencies 
filled our treasury so that it seemed safe against any 
accident in sight. 

But suppose our crops were to fail for a couple of 
seasons, and Europe were to have good ones, or find 
good ones in Asia, Africa or Australia ; and suppose, too, 
that Germany, with her splendid technical education, 
were to drive our manufacturers out of Europe, our gold- 

369. But that supply would probably run down to the 
cannot be depended point where Mr. Cleveland had to sell bonds 
unon ' to increase it, and we might be rushed again 
to the brink of national bankruptcy — or over the brink. 
But we have now a defence against that, in the Act of 
March 19, 1900, which declares it to be the country's 
policy to pay gold, and provides by legislation the 
means for doing it which Mr. Cleveland took the respon- 
sibility of providing himself. Yet tho that act declares 



378 



The Promotion of Convenience. 



[§ 3^9 



it the policy of the country to keep all its money on a 
par with gold, it does not prescribe any method for 
doing so, or put the responsibility for doing so on any- 
body's shoulders ; it leaves room to pay in silver, current 
expenses of the government averaging over $1,500,000 
a day, and 8700,000,000 bonds, principal and interest, 
and fastens no responsibility to redeem that silver 
on anybody. A secretary of the treasury could do it 
if he wished, or he could find abundant pretexts for 
not doing it. A President could order him to do it or 
not to do it. What is of more importance: any declara- 
tion of Congress can easily be set aside by a future Con- 
gress, if elected by the people to do so. Despite the 
Act of March, 1900, the Democratic nominations later 
in the year threatened as much as those of 1896. They 
distinctly interrupted business, but the enormous re- 
vival after their defeat, shows that at least the people 
able to conduct business, at last understand the matter. 

The election of 1900 confirmed the'favorable outlook, 
and in that of 1904, money questions were no longer a 
distinct issue. But they are apt to crop up again, espe- 
cially when the hard experience we have recounted grad- 
ually drops out of memory. The silver craze was not 
the first time that people have attempted to get rich in 
some such way, nor will it be the last. The ignorant 

are all the while trying some such decep- 
370^Ught-welght tive scheme for getting rich by magic. 
Mwscheme! "° Soon after the war, when it was proposed 

to pay off the greenbacks, and even when 
the confidence that they would be paid had brought 
them back to even value, from a value of forty gold 
dollars for a hundred greenback ones, there were still 
people who objected to having the greenbacks paid, 
and wanted enough more issued to fill evey man's 
pockets. There was no explanation of how these 
people expected to get the greenbacks into every man's 
pockets, or of why they would not be as well off if they 
would set to work and get a corresponding amount 
of gold into their pockets. Work did not enter into 
their calculations. They had a thousand schemes, all 



§ 370] Money — Some American Experience. 379 

of which disguised some plan for really making the 
government give greenbacks to all who wanted them; 
and of course they did not realize that doing so would 
make the greenbacks as worthless as the Colonial and 
Confederate money. 



CHAPTER XXVII. 



M O N E Y (C O NTINUED). 

Needs for tlw Future. 

Despots have sometimes made themselves rich by 
debasing the currency and making the people take 
it at full value; but not often, if ever before, have a 
people thought, like many of ours, that they could get 
rich by debasing their own currency. Of course the 
best safeguard against all such schemes among the 
people, is not to have ignorant voters. But probably 
371. The best not many men in America — white men at 
safeguard. least — will ever be deprived of their votes. 

So our only way of having no ignorant voters is to 
educate them so there will be no ignorant. What most 
needs to be taught about money, is that there is no 
way to make a dollar good for a hundred cents' worth 
of anything else, but by putting a hundred cents' worth 
of something into the dollar itself, or by being ready 
at a moment's notice to give a hundred cents' worth 
of something for it. These methods are not equally 
convenient: for it is much easier to handle considerable 
amounts in paper than in coin, or to handle a silver 
dollar holding only fifty cents' worth of silver, than to 
handle one twice as heavy. 

Nor are the two methods equally safe. Silver prob- 
ably deceives more. Perfect safety lies in having the 
full value in the dollar itself: then no misfortune or 
foolishness or rascality can depreciate it. After all, there 

380 



§ 374] 



Money — Needs for the Future. 



38i 



372. The safest is no absolutely safe material for money, 
mone y- because new discoveries may reduce the 

value of gold itself; but gold is the safest there is, 
and safe enough for ordinary practice. But, as already 
suggested, that would make handling large sums so 
inconvenient, that the world is agreed to sacrifice ideal 
safety for real convenience. 

Balancing the convenience of paper money or light 
silver money, against its dangers, what is the best 
money depends on a good many things. Silver has 
373 Paper better some intrinsic value, which the paper has 
than light-weight not, and it has vastly more durability; 
8ilver, but on the other hand, the lack of dura- 

bility in paper does not count for much, as it is easy 
to issue a new note for a spoiled one. But the very 
fact that silver has some intrinsic value, confuses igno- 
rant people, and even tends to make them dishonest. 
Paper is really much more honest money than silver: 
nobody can take it for anything which it is not. The 
use of it in this country has brought great losses and 
disasters, but the country has learned a great deal 
from them. The people could not long have been fooled 
with paper as they have been fooled with silver. 
Paper has not brought any trouble in England in 
recent times; but there, ignorant people are much 
more under the influence of people of education than 
they are here, and England has no paper money under 
twenty-five dollars. 

Probably if there had been no green- 
?a^ge!?Hs! y ,n backs under twenty-five dollars, most of 
the people who made trouble about them 
after the war, would have known so little about them 
that there would have been no trouble. Even if the 
money-schemes for making everybody rich, are started 
for selfish reasons by able men, and even if such men 
are able for a time to fool a few other able men new 
to the subject, the schemes depend for their principal 
following upon the people who have too little judg- 
ment to see twenty-five dollars often. The only thing 
to make our paper silver certificates safe under all 



382 The Promotion of Convenience. [§ 375 

probable conditions, is to put a dollar's 
Oliver ce!?ifica?es. worth of silver into the silver dollar, and 
call in all those which contain less. Simply 
to take away its legal-tender character, would con- 
tract the currency and destroy confidence, so that 
many people could not get money enough to pay their 
debts, and much bankruptcy would follow. It would 
contract the currency by two temporary strictures: 
first, people would be slow to accept silver dollars or 
silver certificates : so they would go to the treasury for 
redemption. Next, as the treasury is not at all likely 
to have enough other money to redeem them, it would 
have to pay out bonds to meet part of them, and the 
currency it would take in place of bonds would make 
just that much less for business use, until it should 
be paid out again. It would destroy confidence, be- 
cause, the treasury gold supply being gone to redeem 
the silver currency and certificates, the treasury would 
be in the condition of a man without money in his 
pockets or in bank. He might need it before he would 
have time to borrow it, and, if everybody knew his 
plight, would probably have to borrow at heavy ex- 
pense, as Mr. Cleveland did. 

To redeem the silver currency in new legal-tender 
greenbacks, would meet most of the difficulties, if 
government had gold on hand to pay the greenbacks 
as wanted. But there is a difficulty that it would not 
376. Objections meet: the use of greenbacks keeps the 
to ail government government in the banking business, and 
notes " as long as it is, the money system of the 

country is under the control of politics, and subject 
to the attacks of the politicians which have kept busi- 
ness disturbed for over forty years, since government 
went into that business during the civil war. 

Yet government can be got out of the banking busi- 
ness without diminishing the volume of money, and so 
contracting the currency. The notes of private banks, 
properly regulated, could replace the government notes, 
and there is no objection to the government continuing 
to coin money (if it coins only honest money) as the Con- 



§ 377 <>] 



Money — Needs for the Future. 



383 



stitution requires: so it is only necessary to provide 
for that portion of the money which is not coin, or, 
at least, not honest coin. The government mints can- 
not supply all the money needed, for several reasons: 
377. Yet coin in- m tn © first place, prices depend on the 
sufficient, amount of money in circulation, and are 

now fixed on a basis of much more money than the 
coin ; to get back to coin by retiring the other money, 
even gradually, would contract prices so that a corpora- 
tion having to pay a million dollars' worth of bonds fifty 
years hence, would find a million dollars of its assets, at 
present values, fallen to probably a third of that price, 
while its debts would not have shrunk at all : that means 
inability to pay them. But instead of getting down to 
the coin we have, why not let government coin more, as 
fast as it retires light silver and its other bad money? 
Because the demand for so much more gold would 
raise its price, so that the farmer and manufacturer 
and miner and laborers of all kinds would have to 
give more of their products to enable the government 
to get gold — taxes would rise. Another objection 
317 (a) and resulting from, or at least closely con- 
ineiastic, nected with, the last, is that currency 

only in coin is very inelastic. It is impossible to buy 
much gold, especially suddenly, without raising the 
price (that is to say: making it exchange for more 
of other things) ; and conversely, it is of course impos- 
sible to throw much onto the market, in coin or in 
any other shape, without lowering the price (that is 
to say : making it exchange for less of other things) : 
so it would be very hard to keep a coin currency just 
equal to the varying needs of business. 

Moreover, an exclusively coin currency is extravagant. 
To have enough gold for active times, would mean 
to keep it idle in inactive times, and so lose interest 
377 and eats on it. Business requires an elastic cur- 
up interest. rency: while Nature and men are taking 
their winter rest — no crops produced, little building 
and mining, little travel — there is little business, and 
little currency is needed. In the spring, as things 



384 The Promotion of Convenience. [§ 377 b 



wake up, more is needed, and as fall approaches, 
and the farmer has to pay labor to gather his crops, 
and the dealer has to pay the farmer, and the rail- 
roads and merchants are busy with the crops, a great 
deal more money is kept in use. A mere coin currency 
cannot expand and contract to meet these conditions. 

An exclusively coin currency, then, is open to many 
objections that can be met only by a paper cur- 
rency. And yet the burden of our song has been 
that a paper currency is dangerous. But it is not 
dangerous if the people generally can be made to 
070 P . realize that it is: because then it would 

378. bood paper , , f . 

currency pref- be taken care of. A paper currency is 
erable " safe if its promise to pay is certain; and 

dangerous only if, as in the civil war, it cannot be 
redeemed in coin when required. 

Beside the reasons already given for not letting the 
coin go into use at once, instead of keeping it to redeem 
the paper, is the very important one that experience 
has shown that it is safe, even in ordinary banking, to 
let out four dollars of paper for every dollar of coin in 
hand. If people know that the banker has a reason- 
able amount of coin and other value to meet the paper, 
not all of the paper would ever be presented for redemp- 
tion at once. People are like the Dutchman who got 
frightened and went to the bank for his money. As 
soon as it was offered him, he told them to keep it: 
"Yen you got him, I no vant him: ven you don't 
got him, I vant him." 

It is not meant to imply that it is safe for a bank 
worth a hundred thousand dollars to issue notes for 
four hundred thousand: nobody should have out obli- 
gations greater than assets, but rather considerably less, 
to leave a margin for accidents. But if a bank has out 
four hundred thousand of notes, and no other obliga- 
tion, it can safely keep all of its property above one 
hundred thousand, in marketable bonds or good com- 
mercial paper or any other good "quick" (i.e., quickly 
sellable) security that will pay it interest. If it can 
lend four hundred thousand dollars, and get interest 



Money — Needs for the Future. 



385 



on it, by keeping one hundred thousand dollars idle 
in its vaults, that one hundred thousand will really 
be earning fourfold interest; and that, with the in- 
terest on the three hundred thousand in securities, 
makes the bank get interest on seven hundred thousand 
while it has a capital of only four hundred thousand. 
Out of this, however, it must pay expenses, and unless 
it manages well, it may have no profit after all. 

It may very naturally be asked: Why then should 
not all the people participate in this advantage, in the 
shape of lowered taxation, by keeping the government 
in the banking business of issuing notes? For the 

same reason that, as we saw (236 6, 236 c), 
gJSimmLit?* fr ° m government should not be put in the 

manufacturing business. It would leave 
to politicians with pulls, the work that should be done 
by men fitted for it by nature, and put in place by 
natural selection; and it would take away from the 
community the enormous advantage of having its 
banking done by such men under the stimulus of com- 
petition and personal reward. 

A word more regarding the elasticity of the paper 
currency. Of course the bank must lend this cur- 
rency in order to get interest on it. When the country 
is very busy, people will borrow it all; when business 
is dull they will not need it, and will pay their maturing 
notes, and the bank will have to take its currency back. 
Then, of course, it fails to gain interest on it, and on 
its idle coin too ; but the paper costs nothing. 

380. Essentials of Notwithstanding all that has been said 
banknotes. "Wild- in favor of a non -government paper cur- 
cat" money. rency, the country has tried private bank- 
notes, and found them wanting. But this was largely 
because they were issued on the authority of individual 
states, and especially of some of the newer states, 
where political organization was very primitive, and the 
regulations were primitive and primitively enforced. 
If anybody proposes to put paper in general circulation, 
it is essential that it should be done under conditions 



3«6 



The Promotion of Convenience. 1 [§ 380 



to protect against general harm. Under the imperfect 
conditions alluded to, a great many notes were spread 
over the country without enough coin and other assets 
behind them to make them safe ; and many of the notes 
from the poorer and more provincial banks were so 
poorly engraved and printed that it was easy to counter- 
feit them. As a result, nobody knew whether most of 
the money offered him was good or not. People were 
constantly getting "stuck" with bad notes, as they 
sometimes are with pewter coin. It became worth 
while to issue frequent pamphlets — 44 Banknote Guides ", 
44 Counterfeit Detectors", etc., etc., and every shop- 
keeper had to keep one, and before accepting money 
that he did not know well, turn to his pamphlet for 
description and advice. 

One of the good things blown by the ill winds of 
the great civil war and its depreciated greenbacks, 
was the disappearance of the old 44 rag money": they 
blew it out of circulation. Everybody understood a 
greenback, it was the same thing the country over — 
well made (even if ugly) and hard to counterfeit. Tho it 
was worth at one time but forty cents on a dollar, people 
knew what it was worth without turning to a 14 Guide" 
or "Detector", and soon it drove the private rag money 
out of existence. That, by the way, was an apparent 
(but only apparent) contradiction of the famous 44 Gresh- 
am's law", that the worse money always drives out 
the better. But it cannot be gone into farther here. 
To summarize our conclusions regarding the country's 
needs. In the first place, there is always a need of 
plenty of money — more even, when business is brisk, 
than all the gold coin in the country. In the second 
place, it should be supplied under regulations from the 
United States Government, not the state governments, 
so that the money will be the same throughout the 
country. 

The regulations should be: first, secure 
a 8 sounrsyst a em. of tnat noD °dy not of proved character and 
ability can start a bank of issue; second, 
that no more notes shall be issued than there are good 



Money — Needs for the Future. 



387 



quick assets (377 b) on hand for redemption of, at least 
one fourth of which assets shall be gold coin ; third, that 
these notes shall conform to some good definite standards 
of workmanship — perhaps that they shall be provided 
by government; only, as we have seen and shall see 
further, we need to be very cautious in what we trust 
government to provide ; (The mere mechanical furnishing 
of these notes would not, of course, be "going into the 
banking business fourth, that a limit for ordinary 
issues shall be fixed, and all beyond that limit taxed 
so as to force their retirement when not really needed; 
fifth, that each bank shall have arrangements for 
redemption at several centres, so as to facilitate retire- 
ment; sixth, that government examiners shall visit the 
banks unannounced, at frequent intervals, to see that 
the regulations are complied with; seventh, that such 
penalties shall follow infringement of regulations as to 
make infringement extremely improbable. 

There are those who favor a single central bank 
of issue, as is virtually the case in England; but that 
does not seem adapted to our large country, and there 
are other objections which cannot be gone into here. 
Humanity is not wise enough and careful enough yet 
to make us sure that any arrangements are going to 
work perfectly; but under those suggested, the law of 
demand and supply would probably keep the currency 
as nearly adjusted to requirements as anything is at the 
present stage of human progress. If there were not 
enough, the demand for more would make profits great 
enough to tempt more people into issuing it; and if 
there were too much, the portion uncalled for would be 
retired, and the capital behind it be turned into things 
in more demand. 

Under present arrangements the bank 

elastlc B curren°cy? n cannot i ssue more, because when there is 
a demand for more, the only thing back 
of our present banknotes is United States bonds, 
which are admirable as far as they go, but they do 
not go far enough — there are not enough of them, and 
they pay very low interest; besides, if a bank wants . 



3«3 



The Promotion of Convenience. 



[§ 382 



to enlarge its circulation now, it must go through an 
enormous amount of red tape, including buying a lot 
of government bonds, and sending to Washington for 
notes, and waiting till they are engraved. While all 
this is going on, a panic could wreak destruction. It 
would therefore be well to substitute for United States 
bonds, all securities in the country that an able commis- 
sion (best, perhaps, appointed by the banks themselves) 
should pronounce safe for the purpose (they would 
not be a very large proportion of the whole), such 
commission to revise its list at frequent intervals, and 
banks to shift their securities accordingly. 

Then to get the notes into circulation, it would only 
be necessary for any man who has the securities, to 
take them to bank and borrow banknotes on them 
up to within a reasonable limit of their face value; 
then when his need 16 over, he could take the notes 
back and get his securities. 

Commercial paper of high quality would not be 
available to base the notes on, even tho there is more 
of it when business is brisk, and less when business is 
slow, because it would be very difficult to be sure that 
such paper, when offered, was for actual goods sold; 
and an elastic currency would lead to inflation of values 
unless it were carefully limited to a basis of actual 
property. So far as currency might be based on 
accommodation paper, it would, of course, be pure 
inflation, and might go on until it should collapse 
like an exploded balloon. But even if it were based 
on genuine commercial paper, the producer of raw 
material might get currency on the note given him 
by the manufacturer, the manufacturer might get it 
on his jobber's note, the jobber on the retailer's, and 
the retailer — a grocer, for instance, on the consumer's; 
so the same raw material might originate currency 
four times — on the notes received by the banks from 
the raw-material man, the manufacturer, the jobber 
and the retailer; value added by the manufacturer 
might originate currency three times — on his jobber's 
note, and the retailer's and the consumer's; the job- 



§ 3^3 a l Money — Needs for the Future. 389 



ber's service, twice; and the retailer's, once — an aggre- 
gate of ten issues of currency where there would be a 
sound basis for only three actual values accumulated — 
the raw material, the manufacturer's, the jobber's. 
It seems therefore that a safe issue of currency based 
on commercial paper would be practically impossible. 

The retailer's note could not represent a value to 
base currency on: because even if the goods in con- 
sumers' hands are not — like food, actually destroyed, 
their commercial value as a basis for currency, is gone 
as soon as they are in consumers' hands. Even if 
they endure, like furniture or jewelry, they at once 
become "second-hand". 

383. The farmer's In the foregoing analysis, by the way, 
needs the farmer's demand that he shall have a 

chance too, as well as the "bloated bondholder" — 
that currency shall be issued based on his farm, not 
merely on coin, or even on bonds that can be sold at a 
moment's notice on the stock exchanges, is counter to # 
the requirement that the currency shall be based on 
quick assets. His land, or even a mortgage on it, 
cannot be sold for full value at a moment's notice, if 
there should be a run on the bank to redeem its notes 
in gold. 

This brings up the serious question of how to sup- 
ply the demand for money in thinly-settled regions 
where there are no banks — where, according to stories 
we hear, a man sometimes rides around a whole day 
in a vain effort to get a fifty-dollar bill changed; and a 

man on being asked if he could change a 
ofi,?&S!L ,yM9 ten-dollar bill, answered : "I never had so 

much money in my life, but thank you for 
the compliment, all the same." In the first place, 
the reason for lack of money in such regions, is 
generally (not always) the same as for the lack of it 
anywhere else — the people have not the wealth to base 
it on, or the ability to make the w T ealth — in fifty-dollar" 
bills which they cannot change, or in any other shape: 
the regions are generally poverty-stricken, and the 



39© 



The Promotion of Convenience. 



[§ 383 <* 



attempt to give them plenty of money by putting a 
bankful of it among them, would do no more good 
than to put a bankful among the New York tene- 
ments: the people cannot get the money unless they 
have something to exchange or pledge for it. Even if 
the farmers wanted to mortgage their farms to a new 
bank, often they could not do it, because the farms are 
often mortgaged already. 

Still, there are places where people really have 
good farms and crops, but not enough money for ordi- 
nary needs. But it would be odd if such regions had 
the resources to establish banks, and the need for 
them, and still went without them. So their demand 
for banks still looks like one more form of the cry that 
assumes so many forms — for government to supply 
money to those who cannot supply themselves. 

383 (b). Remedy ^ et tnere are P^CeS to which it WOUld 

for legitimate be well for banks elsewhere to send 
needs ' branches. That is actually done in some 

countries — in Scotland and Canada, for instance: a 
city bank will get a country storekeeper to start a 
little branch, supplying him with money and elaborate 
instructions based on experience; and such a branch is 
often a very good thing for everybody concerned. 

Apparently the serious want is in places too small 
for even our new banks with $25,000 capital. Little 
agencies seem to be still wanted. A few of them wisely 
distributed undoubtedly would silence all reasonable 
calls for "more money 

Two things can be done to facilitate that — enable 
banks, by law, to establish branches; and take off 
the taxation — from small ones at least. The general 
government does not get enough from bank taxation 
to make it worth bothering with anyhow. It is one 
of the pottering taxes that ought to be cleared out of 
the way. It yields only a half of one per cent, of the 
national income. 



CHAPTER XXVIII. 



PUBLIC WORKS. 

• Extra-Municipal. 

So much for Money. Probably the next item of 
popular convenience evolved by government, and one 
over which government care is almost equally taken 
for granted, is roads of some sort; but as already inti- 
Roads mated, the kind and degree of care that 

' oa s ' government should take of the new forms 
of roads — railroads and city railways, is open to much 
debate. 

Regarding the immense importance of roads, there 
is a very early and very authoritative piece of testi- 
384 ra;. As spread- mony. The Romans were the greatest 
ing civilization, road-builders and — a very suggestive fact 
in the connection — the greatest spreaders of civilization 
the world ever saw before our own race took hold. 
The proconsul who was probably the most famous 
advancer of Roman civilization in barbarous regions, 
when asked what was the first thing he provided a 
new country with, answered: " Roads "; "And the 
next thing?" "More roads "; "And then?" "Still 
more roads." 

As the importance of roads bears on many civic 
questions, we will consider them more fully than some 
other topics which at first seem nearer the centre 
of civic relations. The Romans, in carrying out this 
principle, put roads through most of continental 
Europe west of Russia and south of Scandinavia, and 

39i 



everybody has had to give some da\> 
road -ma king, or furnish a substitute, 
degrees commuted into money, just as 
was (56a), and road-makers were hired 
ment, as soldiers were. 

Passage was generally free over roads 
as cities grew up, both in the old home ai 
ment not only itself improved roads bet 
also chartered private corporations to 
these roads, tolls were generally ch* 
Romans were the best road-makers an 
nations, it may be interesting to note 
are unquestionably "our noble selves 
was our expansion over great tracts c 
before good roads had time to grow up, 
habit of putting up with poor ones. 1 
wanted better things, improvement h 
blocked by bad organization and corrui 
ment. 

3SA(o). BadAmeri- Government road-makin 
can organization. s id e red established. But 
ganization has been left too much to 
Outside of unmistakable city and villa; 
possibly inside of them), it should be a 
and it is far from certain that it shoul 

tional function. Evf»rv imnort.a nt. rna, 



§3«S] 



Extra-Municipal Public Works. 



393 



much as do the people of more populous adjoining 
towns. Moreover, the poor road-making thus forced 
on the poor towns is not confined to them alone, but 
tends to become the standard for their neighbors. 

These difficulties are more effectual with us than 
with other civilized nations, because our ancestral spirit 
cf local independence — our desires to govern our home 
affairs ourselves, our objection to submitting them to 
the more remote state and national governments, is so 
strong that many consider it the very basis of Anglo- 
Saxon liberty. Even in such a town as Concord, Massa- 
chusetts, quite possibly the most enlightened rural town 
in the world (and consequently one of the most wealthy^ 
part of a magnificent boulevard intended to run from 
one end of the state to the other was bitterly opposed 
because: "This town has always been able to manage 
its own roads." 

Yet while Anglo-Saxon local independence obstructs 
roads so much, England has splendid ones, because our 
English cousins are more thickly crowded; their roads 
are older than ours; and they are near such good ex- 
amples in France and Switzerland. Relative wealth 
cannot affect the matter much as regards our older 
and richer states: for they are rich enough; but our 
national wastefulness and extravagance have a good 
deal to do with it. Few things are more wasteful and 
extravagant than poor roads: in any ordinary civilized 
region, they waste more, over and over again, in horse- 
flesh, wagon-wear, and time of man and beast, than 
good roads would cost. 

Tolls are not generally charged now, tho there are 
some survivals. But in most cases governments have 
abandoned the tolls on their own roads, supporting them 
by taxation, and have also acquired the private toll- 
roads by eminent domain, and thrown the toll-gates 
open. 

The experience in this regard with bridges has been 
about the same as with roads ; yet the 
r geS ' greatest and newest of the great bridges — 



394 



The Promotion of Convenience [§ 385 a 



those between New York and Brooklyn, tho built by 
the city governments, still take toll. But there is 
prospect of its speedy abolishment. Yet at first sight, 
it does not seem fair that the vast majority of the resi- 
dents of the Greater New York, who do not use the 
bridges half a dozen times a year, and hundreds of 
thousands of them who do not use them at all, should 
pay as much as those who use them twice or oftener 
every day. But the argument carried out with stern 
logic, would put a toll-gatherer at every bridge in the 
country, and very few people want that done. As long 
as each man has a right to the free use of such a general 
and important public convenience when he wants it, as 
long as the cost for each person is a trifle, and the 
indirect benefit to every person, whether he uses it 
or not, is great, the question whether one man wants 
it more than another, is one of those trifles which the 
law does not bother itself with.* 



iw 6 nershl su,a era R° a ds and bridges in a sense operate 
tion ners ' p ' pera " themselves, but now it is time to take 
special note that as we come to facilities requiring 
operation, there are three relations which government 
can occupy toward public facilities — regulation, owner- 
ship and operation, and neither of the first two involves 
a later one. It is especially important to keep in mind 
the last two as distinct: much mischief is done by 
confusing them. There is a wide and intelligent senti- 
ment in favor of government ownership of franchises, 
especially in cities, in order that their unearned incre- 
ment, often very large, may go to the people instead 
of private monopolists. And there is even a more 
intelligent, and consequently, of course, less wide 
sjentiment that under the universal suffrage pervading 
American and French cities alone, the operation of 
the franchises is a task too heavy for the political 
capacity. During the Hearst campaign which dis- 



* De minimis non curat lex. 



§ 387 a] Extra-Municipal Public Works. 



395 



graced New York City in 1905, the cry of his sup- 
porters was "municipal ownership", while what they 
really meant was municipal operation; and the confu- 
sion of terms drew to their ranks and even their ticket, 
many of the foggy-minded sentimentalists who are 
too ready to sympathize with any cause containing 
a grain of wheat, tho its main constituents be 
chaff. 

387. Ferries and We shall reach more definite applica- 
docks " tions of the principles just enumerated 

as we go on. Let us begin by noticing that ferries 
require infinitely more management than roads and 
bridges. Yet government has operated them several 
times in Great Britain, and occasionally in Germany, 
but very seldom in America. In 1904 London took 
over the Thames steamboats. By 1906 they showed 
a heavy loss. Of the government ferries, some are 
free and some are not. Boston charges for one, but 
runs it at a loss. Glasgow makes a big profit on hers. 
The one over the Thames at Woolwich is supposed to 
perform the service that bridges do higher up the 
stream, and like them is free. In 1905 New York took 
over the Staten Island ferry, but so far with very un- 
387 (ai Municipal satisfactory results. If reports the world 
and Private over can be relied upon, there is nothing 
contracts. exceptional in the showing of government 

extravagance given by the following figures from the 
New York City statistician in 1906, and showing the 
monthly salary items of the ferries run by the munici- 
pality, in comparison with those for the ferry under 
private management at Thirty -ninth Street, Brooklyn, 
and the one run in New York Harbor by the Pennsyl- 
vania Railroad Company. It is claimed that the munici- 
pal ferryboats are so much larger as to require some 
officers that the Railroad Company's boats do not. The 
city employs three crews a day; the Railroad Company, 
two. I am not. however, advocating that method of 
economy: for the indications are strong that it does 
not result economically. 



396 



The Promotion of Convenience. 



r?f „ 30th St. Penna. 

Uty - Ferry. R. R. 

Captain Si 37. 50 $135.00 $130.00 

8uartermaster 100.00 None 55. 00 

cckhand 60 . 00 5 5 . 00 49 . 50 

Porter 5 5 . 00 40 . 00 49 . 50 

Engineer 125.00 120. 00 120.00 

Assistant engineer 1 2 5 . 00 None 82 . 50 

Oiler 90.00 None 77.00 

Water-tender 100.00 None 66.00 

Fireman 90.00 65.00 66.00 

Attendant 50.00 None None 

Mate 75 .00 None None 

Ashman 76.00 5 2 -5° 49-5° 

The franchises (1 59 c) of American ferries have not 
generally been given away. Even in New York, where 
the exceptionally valuable street-railway franchises 
were once given away freely, the ferry franchises have 
usually been sold for terms of years to the highest 
bidders. Docks in Liverpool, Glasgow, Hamburg and 
many other European cities, have been splendidly and 
profitably provided and cared for by the local govern- 
ments. In the United States they are generally inferior, 
tho they are rapidly improving. We shall see some gen- 
eral reasons for this inferiority later; but at best, docks 
are used by so small a portion of the people that they 
are not under as general criticism as most municipal 
conveniences (389 /, 392 c), and their management is 
therefore peculiarly liable to be stupid and corrupt.* 

N° w to come to the modern modifica- 
388. Railroads. tion of roads _ the ra ilroads.t Regarding 

them, it is not fair to compare the United States as a 
whole with any other great nation exclu- 

urJce^nAmerfca s * ve °^ * ts co ^ on ^ es » because most of the 
and England. United States is very thinly settled. If we 
consider only the parts of our own country 

* Treating ferries and docks as extra-municipal may need 
defence, but so would treating them as municipal. 

t In treating this subject, I have been under great obligations 
to Professor Daniels' "Elements of Public Finance", and to 
Professor Seager's Economics, tho not as great as, perhaps, 
the concurrence of our views would indicate. 



§ 3«8 b] 



Extra-Municipal Public Works. 



397 



as thickly settled as other civilized countries, the five 
greatest nations in the order of the frequency, speed 
and comfort of their railroad trains, unquestionably 
would be: the United States, England, France, Ger- 
many, Italy. The order with reference to degree of 
private ownership would be very nearly the same: 
in England and the United States, the ownership and 
management are virtually entirely private. In France 
the government owns part of the roads, and leases them 
to private companies, who run them; in Germany, 
where the government attends in a paternal way to 
more things than government does in any other great 
nation, it both owns and runs nearly all the railroads; 
and so also in Italy until the government leased its 
roads to private companies — partly because it recog- 
nized the roads as sources of political corruption. 
388 <b) itai ^ e Italian leases, after twenty years s 

y ' fell in in 1905. A bill came before Parlia- 
ment to have government resume the running of the 
roads. It was backed by the employees, who believed, 
from the traditions of the previous government control, 
that they would have an easier time under it than under 
private companies. This belief was probably correct, 
but it virtually asserts the greater efficiency of private 
management. In support of the bill, there was of course 
fermented a popular idea that the private managers were 
making too much money, and giving too little for what 
they got. Such an idea of any existing institution, of 
course always pervades the party of discontent. 

The matter was settled by government undertaking the 
operation. If it were not for the apparent impossibility, 
alluded to more than once in this volume, of getting 
unbiased testimony on such a subject, the result of 
this action on the part of the government would be 
plain in the following letter to the London Times: 

"Rome, Oct. 23 [1906]. — The government ownership of rail- 
ways in Italy continues a menace to the life and limbs of those 
compelled to travel in this country. Another serious accident 
occurred yesterday, a passenger train running into a goods 



39» 



The Promotion of Convenience. 



[§ 3886 



train near Turin. Sixteen passengers were hurt. The engine 
driver, station agent, and pointsman are in hiding. 

" It would seem that the discipline of railway servants leaves 
something to be desired, and this no doubt is a factor in the 
general disorganization, of which complaint is made in all 
parts of the country. 

"Apart from all question of danger in railway traveling, Italy 
is made so wretchedly uncomfortable that visitors may well 
pause to consider whether the pleasure of being in Italy is worth 
the misery of being in Italian trains." 

388 (O. Germany. *he G^ rman experience is really the 

only one great enough to justify compari- 
son with ours. If we compare only the portion of 
the United States whose population is something like 
as dense as Germany's, in that portion we surpass 
Germany, partly because of the great inventiveness 
of the American people, partly because of their greater 
tendency to move about, and their having more money 
to do it with, but mainly because of the fact that 
American railway officials are in the business to make 
all they can out of it, and are stimulated by fierce 
competition between themselves and between their 
roads. Yet the American roads are falling off in 
efficiency because of trade-unionism among the men, 
and the interference of banking interests in the manage- 
ment. Still, the Germans are behind us because their 
railway officials are government employees at salaries 
not apt to be changed, and with all the routine indiffer- 
ence that everywhere characterizes the government 
employee with nothing to lose and nothing to gain. 
The fares, tho about the same in money as ours, are 
twice as high, compared with oilier things, as they are 
in the thickly settled portions of America, and the 
trains do not run half as often. 

At the Railway Congress in Washington in 1905 the 
German Ambassador said: "We do not recommend 
that you follow our example in the national ownership of 
railways." He probably meant the national operation: 
the ownership is a much more hopeful proposition. 
The government operation in Germany has failed in 
the particulars (among others) which our people, the 



§ 388 d] Extra-Municipal Public Works. 



399 



President at the head, are clamoring for government to 
remedy here — in securing dissimilar rates under dissimi- 
lar circumstances — between long and short hauls, be- 
tween competing and non-competing points, between 
land and water competition, and between small custom- 
ers and large customers. 

An important point of comparison is the proportion of 
trunk lines opening up a variety of villages between 
central points, on the continent of Europe, as compared 
with England and America. In the countries of govern- 
ment roads, there is usually but one trunk-line between 
important points. In England and America, there are 
usually several, each opening up its own line or towns 
and villages, and all forcing each other, through com- 
petition, to the utmost economy and efficiency. 

Regarding comparison in charges for service between 
government roads and private roads in the same state, 
statistics are scarce and somewhat unreliable, because 
of the confusion between passengers of different classes, 
and because it is next to impossible to tell what a gov- 
ernment road really costs the people : fares may be eked 
out by taxation. 

American experience in government management 
amounts to very little. 

388 (di Gouem- The city of Cincinnati owns the Cincinnati 
ment operation Southern Railway, but leases it to a 
in America. priv ate company. 

The state of Missouri has had a little experience with 
railroads. Governor Folk is reported to have delivered 
himself substantially as follows on the day in 1906 after 
Mr. Bryan, at his home-coming reception in Madison 
Square Garden, had announced himself in favor of gov- 
ernment operation of the railroads: 

"Mr. Bryan's proposition for the taking over of railway lines 
by the national and state governments would be met with no 
acceptance in his [Gov. Folk's] state, where the experiment 
had been tried and found wanting. 

4 4 Missouri had pledged her credit in subsidizing the lines . Prac- 
tical paralysis of traffic during the civil war forced defaults of 
interest payments on the bonds. Under the terms of the char- 
ters, whenever such default was made the state was empowe red 



4oo The Promotion of Convenience. [§ 388 d 



to seM the lines to the highest bidder, or to become itself the 
proprietor under the liens it held as guarantor. In this way 
all of the lines became the property of the state, with the 
exception of the Hannibal & St. Joseph, now a part of the 
Wabash system. 

"The state's mode of operation was for the governor to 
appoint a general superintendent or manager. Such appoint- 
ments were of course political. One of the first was that 
of J. T. K. Hay ward of Hannibal as general superintendent of 
what was then called the Platte County Railroad. This was 
very near the close of the war, when the ravages of armies had 
ceased, commerce was reviving, and confidence returning. Traf- 
fic along these lines was increasing rapidly. 

"Yet every month showed a deficit in the finances of every 
line except the Hannibal & St. Joseph. Loaded down with 
political appointees lacking both railroad experience and natural 
efficiency, the [government] road was such a continuing burden 
to the state that, by a legislative act of March 17, 1868, a 
private corporation which was willing to take it off the hands 
of the state and extend it far enough to reach the Iowa and 
Kansas lines was relieved of all financial liability under the 
original charter, the state assuming the entire bonded debt with 
the interest then accumulated. 

"State Senator Woerner, a Democratic member of the 
joint committee appointed to investigate charges of collusion 
in the sales, said, in a special report, that the state would be 
making a good bargain to donate the lines to any responsible 
parties who could extend them and operate them without 
cost to the taxpayers. 

"While the lines were the property of the state they were 
not, of course, assessed for taxation. Immediately after the 
sales assessments began, and extensions, improvements and 
betterments of all sorts have increased these assessments steadily. 
This year the ten trunk lines traversing Missouri, eight of 
which are outgrowths of the lines sold by the State in the sixties, 
are assessed for $34,000,000. 

"It is impossible to see how Missouri could ever have stag- 
gered from under the debt of $31,735,840, without this source 
of taxation." 

388 <e). African r Despite the frequency, speed and com- 
construction less fort ot the trains on American railroads 
thorough, where population is dense, they do not 

surpass the European roads as roads: they are not, 
on the whole, as carefully built, or as safe to the passen- 
gers or to the people among whom they pass. That, 
too, is probably influenced by the relations between 
the roads and government. Governments are more in 



§ 388 g] Extra-Municipal Public Works. 401 



the way of looking out for the rights of the people in 
general than private corporations are, and are less apt 
to consult economy; moreover, if a man gets killed in 
Europe, a government loses a possible soldier, and it 
cannot spare soldiers: for all these reasons, a European 
government would be more apt than the American to 
put a bridge where a railroad crosses a driving-road, 
and to go through a town above the streets or under 
them. This has actually been vastly more the practice 
abroad than here. Our murderous grade-crossings are 
388 (f) andind- a ^ most unknown in Europe, and where 
dtntaiiu less they occur, there is more precaution and 

careM of safety. by dosing gates than Qur peQple 

would stand. In England the construction of the 
roads, especially in the way of elevated tracks going 
through cities, and possibly at grade-crossings, is per- 
haps not as thorough as in Germany ; in other respects 
the care for the public safety compares favorably. 
Government ownership, however, is not necessary to 
secure that. Good government can secure it, whether 
it owns the roads or not ; it does secure it in England ; 
and government is, on the whole, improving in doing 
it here. 

388 (9). Freight The great difficulty regarding rates of 
diacriminations. f are ari <| f re ight in America is the same, 
probably, as with privately operated roads everywhere: 
through rates between great cities served by several 
lines of roads, or by a water line as well as a railroad 
line, have naturally been lowered by competition, some- 
times below the paying point. The roads have to 
make up for it by higher rates for the intermediate non- 
competitive points. Of course they are as apt — even 
more apt, to get these local rates above reason, than to 
get the through rates below reason. Hence discontent 
that sometimes overlooks the difficulties of the roads, 
and hence grangerism and the call for government con- 
trol (154 a) or even government operation. 

The roads have been led into the golden-goose-killing 
operations of destroying the profitable part of their 
business by driving population from non-competitive 



402 



The Promotion of Convenience. 



[§388g 



points to competing ones. Mr. Stickney* says that 
between 1870 and 1890, in Illinois, Wisconsin, Iowa 
and Minnesota, the former class decreased in population, 
and the latter increased. 

Besides discrimination between points, there has been 
a more arbitrary discrimination between goods, and 
through this means, as well as directly, between per- 
sons. 

And yet despite all complaints, just and unjust, the 
U. S. Bureau of Labor reports a large decrease in the 
cost of transportation while the complaints have been 
loudest. 

388 (fi). conaoii- Of course all the complaints are used as 
dation and arguments by the advocates of government 
competition. ro ads. As to government operation affect- 
ing competition, the argument is the same as the argu- 
ment for trusts (152): the enormous waste of competi- 
tive advertising between competing roads, and the fre- 
quent duplication of management — several able men 
doing work which, if the roads were under one man- 
agement, could be done by one able man, with clerks 
in the place of the others — the other able men being 
released to increase and cheapen other production or 
develop new conveniences (331). But all this is not 
necessarily an argument for government ownership, 
but only for consolidation; and then come in all the 
monopoly arguments against that. But those argu- 
ments hardly have the best of it, as anyone knows who 
has taken frequent journeys over routes parceled out 
among several little roads, with their conflicting con- 
nections, delays at junctions, and retail rates; and over 
the same routes after the little roads have been con- 
solidated, their connections and ticket-books unified, 
and their rates brought to the wholesale standard of 
big enterprises. But to return to the general rate 

question. General extortion is charged, but, on the 

*'*The Railroad Problem", p. C2, quoted in Daniels on 

Finance. 



§388**] Extra-Municipal Public Works. 403 

whole, unreasonably: our freight-rates, despite our 
vast uninhabited stretches, are far the lowest in the 
world; and in our thickly settled regions, our passen- 
ger-rates compare very favorably with all others; 
and moreover both rates are steadily declining. How 
much of this is due to government regulation, and 
how much to the inevitable action of competition, is 
very hard to determine.. With us government regu- 
lation is in its infancy, and has made mistakes. It 
has not yet always succeeded in getting its rates ad- 
hered to, and, as it has greatly insisted on rates in 
proportion to distance, regardless of competition at 
certain points, it has prevented the roads holding each 
other to agreements regarding competitive places which 
might enable them to be easier on non-competitive 
places. 

388 (0. Constitu- The state's right to regulate the roads 
ttonaj questions. ar i ses from the fact that the roads are the 
creatures of the state. Whether the state owns them 
or not, they are natural monopolies, and with us exist 
only by the use of the state's right of eminent domain: 
so the state has the right to prescribe the conditions 
of their existence (1 54 b). 

But suppose a road is built without any under- 
standing regarding rates, or, for that matter, with an 
understanding, it is a question whether the state has 
then a right to impose new r^tes. It has been claimed 
that the conditions under which a company builds a 
road, constitute a contract with the state; and the 
Constitution of the United States (Art. II, Sec. X) 
provides that no state shall pass a law impairing the 
obligation of contracts. But under the Constitution 
(Art. I, Sec. VIII) the United States has the right 
to "regulate commerce between the several states", 
and can probably pass laws under that provision which 
would help remedy the difficulty. As to the individual 
state, it is a question whether the constitutional pro- 
vision affects a state's relation with its citizens, or the 
relations of citizens with each other: for instance, each 
man holds his land from the state, and yet the state 



404 The Promotion of Convenience. [§ 3881 

can take it from him by eminent domain. But emi- 
nent domain was an established institution before any 
American state was; it is part of the original under- 
standing — the unwritten constitution, and therefore 
tacitly exempted from interference by later laws; and 
it looks as if a corporation in receiving a charter, had 
to admit certain rights as held in reserve by the state 
for the public good. Moreover, for a long time past, 
most charters have been granted subject to amend- 
ment or repeal. 

If the charter creates a virtual monopoly, of course 
the case for the state's right of amendment is all the 
stronger. But a city is not a state, and if a city makes 
a contract with a street-railway company for a rate 
of fare, that is clearly a contract, not of the state with 
its citizens, but of citizens with citizens: the state 
cannot interfere there; the Constitution of the United 
States clearly forbids. 

388 u>. Taxation Yet if the railroad is taking too much 
of franchises. money from the people, the state could 
amend most any recent charter, or both the state and the 
city could tax the franchise, unless something in the state 
constitution might forbid. There is a good deal of agita- 
tion now for state legislation making the right to tax 
all franchises perfectly clear. New York passed a law 
to do it in 1899. Nevertheless, taxing a franchise, either 
by the city or by the state, does not cover the whole 
case, especially (as we shall see more particularly later), 
as taxation for any purpose but the raising of revenue, 
is very doubtful policy. Moreover, it is conceivable 
that if fare and freight were made expensive, and then 
the money taxed away from the roads, enough might be 
got to run the whole government, and yet it would be 
solely at the expense of those using the roads, and all 
others would escape taxation. Perhaps, tho, those who 
do not use them, directly or indirectly, are so few and 
pay so little in taxes that, as in the case of bridges, the 
question concerning them maybe regarded as one of the 
trifles that the law does not take into account. 



§ 3 88/] 



Extra-Municipal Public Works. 



388 (hh corpora- The fair adjustment, then, would seem 
Hon graft and to be to keep charges at the point where 
potitna graft. ^ e roads can make a fair return on capital 
and pay about the same rate of taxes that other property 
does. That assumes, however, that the railroads can 
all make money enough to do all those cheerful things ; 
but in the last decade of the nineteenth century, most 
of the American railroads were bankrupt. They had 
been built faster than business had grown to support 
them, and very often the men spending the stock- 
holders' money incorporated themselves as " construc- 
tion companies" and "car companies", and then paid 
those companies enormous prices to build the roads 
and equipments. 

It does not follow, however, that the roads would 
have been more prosperous if they had been govern- 
ment institutions. Probably, however, their officers 
would not have been less so, for as governments run 
things in America, the politicians in charge of such 
public works as we have, are not generally supposed 
to suffer from lack of prosperity. 

388 a). American There have been several efforts to regu- 
attempts at gov- late the prices charged by the railroad 

ernnentregulation. monopolies The chief Q f these in Qur 

country are the Rate Bill of 1906, not yet tested at 
this writing, and the Interstate Commerce Act of 1887, 
which is thus summarized by Professor Seager:* 

" (1) Discriminations between persons, places and commodi- 
ties were prohibited, and railroad officials granting discriminating 
rates were made liable to fine and imprisonment; (2) railway 
rates for interstate traffic were required to be just and reason- 
able, and any rate not just and reasonable was declared to be 
unlawful, and valid ground for a suit for damages by the 
injured party; (3) railroads were required to publish their rates 
and to change them only on public notice; (4) they were pro- 
hibited from charging a higher rate for a short haul than for 
a long haul over the same line and under similar circumstances, 
unless authorized to do so by the Interstate Commerce Com- 
mission; (5) pooling contracts between railroads were prohib- 
ited. The act also created an Interstate Commerce Commis- 

* Op. cit. 



406 



Tlte Protnotion of Convenience. 



[§ 3887 



sion to consist of five members and to be responsible for its 
enforcement and the investigation of cases of alleged violation.' 

The act has been found defective in 

"the attempt to prohibit, at one and the same time, dis- 
criminations and pooling. Experience has shown conclusively 
that competition between railroads involves discrimination. 
Competition in the railroad business means in practice making 
special rates to attract special traffic. But experience has 
snown with equal conclusiveness that agreements between 
railroads designed to put an end to competition can only be 
maintained when supplemented by pooling contracts. So 
long as the proportion of freight which each road is to secure 
depends upon its activity, the self-interest of railroad managers, 
or their credulity acted upon by the misrepresentations of 
unscrupulous shippers, will make discrimination in rates almost 
inevitable. The law undertakes to enforce two lines of policy 
which will not run together so long as different railroads act as 
carriers for the same territory." 

The amendments made and authoritatively proposed 
in the act, as well as its judicial interpretations, for 
which there is no space here, are also well summarized 
by Professor Seager. Upon the success of the Rate Bill 
and the Interstate Commerce Law, with such amend- 
ments as they may receive, probably depends the 
question of whether the railroads and public utilities 
generally throughout the country, can well be left 
under private management with government control, 
or whether they shall be bought and operated by the 
government. 

But it will naturally be asked : if govern- 
lessf7in*8sof C ~ ment regulation has accomplished so little, 
government regu- and if government operation would save 
arfumen plet0 the wastes of competition, why not avoid 
government the questions that reputation has not suc- 

operation. * i «,i 1 

cceded with, and come at once tb entire 
government operation? But it is by no means cer- 
tain that government's efforts, tho not accomplishing 
all they aimed at, have been useless in leading toward 
the increasing lowering of rates ; and unfruitful as the 
attempt at regulation has been, the attempt at the 



§ 388 m] Extra-Municipal Public Works. 



407 



vastly harder task of operation would probably be 
equally unsatisfactory. There are two hundred thou- 
sand people in the civil service now. The corruption 
involved in dealing out these places is still, despite 
all the efforts of the civil-service reformers, among the 
chief obstructions to good government. The railroads 
employ four times as many men as the civil service; 
to make all these men government employees would 
make the corruption sixteen times as great. Their votes 
would simply make the tail wag the dog: instead of the 
government managing the roads, the roads would man- 
age the government. The present trimming for the 
"labor vote" is nothing compared with what would 
grow up for the consolidated railroad vote (400 h). 

Many people think that even now the railroads run 
the government — especially the state governments. 
But as long as the roads are in various hands, their in- 
terests are different, and they pull in opposite directions. 
Make a body of millions of placeholders whose interests 
are identical ; if they would not have their own way in 
railroad management and everything else, to a degree 
that competition prevents anybody from having it 
now, it could be only because politicians no longer 
stand in dread of voters. The Italian experience may 
not be conclusive, but it is at least suggestive. 

The officers of the roads in such cases, in America, 
would be "favorite sons'' and "men with pulls". The 
genius for railroad management that now fills most of 
the presidencies and superintendences with men who 
began at the brakes, would have to give way to the 
genius for political pulls; the roads, the shippers and 
the passengers would suffer accordingly; and the tax- 
paver would have to meet the deficits. 

The effect on railroad salaries probably would be 
what it has been on telegraph salaries in England. As 
soon as government control took the pressure of com- 
petition off, salaries advanced, deficits began, and the 
taxpayers had to settle them. 

Rates would be governed by political favoritism in- 
stead of the exigencies of business. 



408 



The Promotion of Convenience. 



[§ 388 m 



The experience of our Canadian neighbors is valuable 
in this connection. The London Economist states that 
the lines the government has built in Canada are located 
to foster constituencies, not trade; there was much 
corruption in the contracts ; the roads have been run as 
political machines ; much improving has been done for 
the sake of giving contracts to political allies; cost of 
operating has been higher, and number of employees 
greater, than on private lines; on account of political 
pulls, unfit employees are retained, and favorable rates 
are given to friends of the administration; politicians 
back enormous claims against the railways; and un- 
businesslike competition to help political favorites has 
injured private roads. 

388 (n). "Labor" The effect of government operation on 
under government strikes is one of the most important points 
operation. ^ n ^ c w hole discussion. Of course a rail- 

road is not like a factory, where Labor and Ability can 
have their quarrels without making the public suffer: 
if the factory stops, the public can get unmonopolized 
goods at some other factory, or for a time from the 
stock in the shops. But if there is a strike on a railroad, 
the public must simply do without the service until 
matters are adjusted, and at great loss of money and 
convenience. This certainly gives the public, as rep- 
resented by the state, a right to prevent quarrels be- 
tween Labor and Ability from stopping the cars (32). 
Government operation would certainly simplify this 
matter. We do not hear of many strikes in the post- 
ofiiecs: but they are much simpler affairs, and require, 
in large part, a higher type of Labor. But if each rail- 
road employee were a government servant, resistance 
to regulations, or refusal to work, would be flat rebellion, 
and then there would not be as much question of sup- 
pressing it by force as there is about suppressing strike- 
riots now. 

It is impossible to tell what the majority of the 
advocates of government operation of the roads really 
want : at one moment they seem to be calling for gov- 



§ 3^8 p] Extra-Municipal Public Works. 



409 



eminent control, not only in railroads but in all industry ; 
and as soon as government sends police or militia, or 
even injunction, to enforce control, they are crying out 
against the tyranny of it. 

There is much difference of opinion regarding state 
operation of the railways in New South Wales, but 
there is no difference in the opinion that the great 
strike of 1903 was better handled by the government 
than it could have been handled by a private company. 
But there happened to be a strong government, which 
probably would have backed up a private company 
with all needed efficiency. A weak government would 
have had a weak result in either case. 
388 (0). improve- There seems to be no just reason, 
unSlr private however, why private managers of rail- 
controi. roads should not contract with their men 

for definite periods of service or definite notice before 
quitting, and especially not to interfere with other 
men taking their places. But the unions probably 
would not let the men make such contracts, and if 
the men were to make them, they have no estates at 
peril for damages, in case they break them. There is 
a great deal of honor among the men — enough to sus- 
tain many of them in any sacrifice to their unions; 
but that very feature of their honor tends to prevent 
it sustaining contracts with the companies. Yet that 
is not true of all classes of employees. The locomotive 
engineers naturally must be men of more ability than 
most other unionists, and they quite generally stand 
by their agreements. 

There has been a great deal of talk of government's 
protecting the public by declaring conditions upon 
388 (pi Gooern- w h* c h Labor must accept employment 
ment control of under public franchises, just on the same 
private operations. grounds that it declares conditions upon 

which Ability must operate the franchises. The propo- 
sition certainly seems fair. Its details are simply to 
make it the law that anybody accepting such service 
shall give some stipulated notice before quitting work, 
shall not interfere with anybody taking his place, and 



410 The Promotion of Convenience. [§ 388 £ 

shall be subjected to imprisonment (fines are of no use 
against people who have no money) for violation or 
evasion of the law. There are now of course general 
laws against violence and destruction of property, and 
occasional timid laws against interfering with the Right 
to Work, but probably there is no law against a laborer 
who is really a public servant, quitting his place with- 
out notice. Such laws, however, would not be counter 
to the XV. Amendment of the National Constitution 
prohibiting involuntary servitude, because the men 
would enter upon the obligations voluntarily. But 
undoubtedly the labor agitators — especially those who 
make their living out of strikes — would in the first place 
bitterly oppose such laws ; and if the laws were carried, 
would try to dissuade men from taking service under 
them. But such laws are so manifestly fair and in a 
good direction, that it is certainly worth while to 
attempt them.* 

* As a safeguard in such matters, Professor Adams recom- 
mends that franchises granted to public-service corporations 
and industries with a "public use" shall contain the following 
points : 

"Conditions of employment to be fixed for annual periods, 
some time in advance, by collective bargaining between repre- 
sentatives of the employers and employees, as provided in the 
Victorian Wage Boards (described on his page 496). Where 
either side refuses to elect representatives, or the representatives 
refuse to elect a standing arbiter or arbiters, such officials 
to be appointed by the governor or by the courts. 

' ' Employment in such industries or service to be by individual 
enlistment or contract for a protracted period, sav three months. 
Employers and employees to post bonds for tne faithful per- 
formance of all agreements. The bond of the employees to 
be accumulated by retaining a percentage of their wages, as 
is done in the trade agreement between Wichert and Gardiner, 
of Brooklyn, and the Independent Union of Shoe- workers of 
Greater New York and Vicinity. 

"Strikes, picketing and boycotts among such employees to 
be punished as criminal conspiracies, and special protection 
to be afforded the employer in case of strikes, by police, militia 
and injunctions. 

"Lockouts to be declared illegal, with provisions for the 
appointment of a receiver for the industry when its operation 
is discontinued." 



§ 389] Extra-Municipal Public Works. 411 



Whatever may be the way out, it is as certain as 
anything in the future of society can be, that the 
public will not long endure such inconveniences as it 
has lately been put to by railroad strikes; not to 
speak of the coal strike and the beef strike; and that, 
government operation or not, the law will inevitably 
take a more comprehensive hold on the matter, and that 
any man having any employment at all, will have to 
recognize some duties that he now ignores. (Compare 
the treatment of the subject in Chapter XX.) 

wtVidaZT' In the United States, cities, states and 
politics. aven the nation have given "goverment 

aid M for building railroads, the smaller governments 
generally by money, and the states and the general 
government by land granted to the company out of 
the public domain, which the company could sell or 
mortgage. In Europe, "state aid" consists more fre- 
quently in the state building and running the railroads. 
England can hardly be said to give any aid at all: for 
the landholding interests in Parliament are so powerful 
that England does not give the roads the full benefit of 
eminent domain ; but they have virtually had to buy 
their rights of way for whatever landowners hold out for. 
Nevertheless, they compare favorably in financial results 
and facilities to the public, with roads owned by gov- 
ernment elsewhere. 

It seems plain from our long consideration, that 
which is the better plan depends on the degree of civili- 
388 M. ne con- zation . As far as the world has got , the best 
elusion. present means, as between government and 

private initiative, of developing railroads, seems to be to 
leave the building and running of them to individual 
initiative, as it is here and in England, with cautious 
government aid when really desirable, and to improve 
the government regulation of them. 

In point of time, the conveniences gov- 
Mlex P p°res$ . ffice ernments probably began supplying next 
after money and roads, were post-horses. 



412 



Tlte Promotion of Convenience. 



[§ 388 



They were supplied on the roads as early as Assyria. 
The postal system, like roads, was evolved for military 
reasons: the supplies of post-horses along the roads 
was begun for the transmission of military orders. 
389 (a), ctty At first sight, there appears to be a good 

versus country, dea i Q f ebbing Peter to pay Paul in the 
modern postal service — making the cities pay for the 
remote regions. But there is really not as much as ap- 
pears at first sight : for tho three quarters of the expense 
of the postal service of our whole country is in trans- 
mission; in thickly settled regions, probably more than 
two thirds is in collecting and distributing, and less than 
one third in transporting. Even if the^hickly settled 
regions entailed more expense in transporting too, the 
Peter-and-Paul system would still be amply justified. 
We can all well afford to be taxed for such an agency of 
civilization as the mails. But in some respects it has 
gone beyond bounds. 

389 (b). favoritism r B ? a perversion of the American demand 
to papers and tor the diffusion of intelligence, the govern- 
periodicais ment is now losing some $12,000,000 an- 
nually in carrying advertisements attached to magazines. 
This it does at a cost of five cents a pound where it 
receives but one cent. Most of this money goes to sub- 
sidizing a business outside of the legitimate periodicals 
that has grown up in consequence of the subsidy, and 
which consists of mere pretexts of periodicals, contain- 
ing no literature or information of any value — what 
there is is mainly the product of scissors and paste-pot 
— the whole sandwiched between its own weight, and 
sometimes more than three times its own weight, of 
advertising pages, these latter largely devoted to worse 
than useless things, and often to abominations. 

The circulation of the class of periodicals read by 
those who will peruse these pages, amounts to less than 
one tenth of one per cent, of the circulation of those 
which the government spends this money in carrying; 
and the circulation of the periodicals of an humbler but 
still respectable and useful character, constitutes not one 
tenth of one per cent. more. The rest pander only to 



§3»9*1 



Extra-Municipal Public Works. 



413 



low tastes, while the government subsidy upholds them 
in competition with the periodicals that offer respectable 
matter, and limit themselves to respectable advertise- 
ments. Virtually all of the worthless and worse than 
worthless class has grown up under the government sub- 
sidy, to the indirect loss of the better class, and at the 
direct expense of the whole community. 

Every dollar paid for postage-stamps contains a 
contribution of eighty cents toward these subsidies. If 
it were not for this waste in subsidizing the lowest 
class of periodicals, our Post-Office could sell letter- 
stamps for half a cent, and postal-cards for a quarter of 
a cent, and realize a surplus in place of the present 
regular deficit. 

Such subsidies can be realized only by large circula- 
tion, and the most effective means of obtaining large 
circulation, of course is low price. So far, the two 
offset each other, but the large circulation attracts 
heavy advertising, and through it the benefit of the 
subsidy is indirectly realized. The five- and ten-cent 
magazines actually cost for paper and printing more 
than the subscribers pay. The deficit and an enormous 
profit are paid by the advertisers, and the advertising 
pays this enormous profit because the government 
carries it at a fifth of what it costs to do the service. 

Where the Post-Office charges $100 to carry 100,000 
two-page circulars, it will carry 100,000 copies of them 
paged in a magazine for $2. The publisher will get, at 
usual rates, $166, out of which he must pay the deficit on 
his sales to subscribers. Leaving this out of account, 
his gross profit on each leaf (two pages) of advertising, 
per 100,000 copies (for printing and paper cannot be 
over $12) is $154. Loss to the government $10. 

Postmaster-General Smith said in 1901 : " In the case 
of hundreds of such publications, whenever the publisher 
expends $1000 in his venture, the government spends 
not less than $2000 in carrying on that publisher's 
business." One publisher sends annually nearly 5,000,- 
000 pounds through the mails, at a net loss to the 
government of close to a third of a million dollars. 



414 



The Promotion of Convenience. 



[§ 389' 



389 (o. compared The United States is the only great nation 
with other that runs its Post-Office at a loss. In 
countries. most other civilized countries, the rates 

on periodicals are the same as on books. Great Britain 
publishes about 4900 periodicals; 40,000 new ones 
were admitted to our mails in the years 1903-5. These 
periodicals of ours kill books. In 1902, Germany pub- 
lished 354 separate books to the million inhabitants; 
France, 344, Russia, 85 ; the United States, 81. Spain 
alone of the alleged civilized countries, published less 
than we did — 66. 

Meanwhile these little spurts and spasms 
tolteratu?™" 9 * °* literature sold at less than it costs, are 
unfitting the American people for any 
reading which demands and repays sustained attention. 
The people are giving up the book-reading habit, and 
taking to magazines instead. Since the population of 
the country has been doubling, the bookstores have 
decreased to one-third.* 

389 re). Qo V em- r That carrying mails is a government 
ment uersve pri- function, is established beyond reasonable 
vate enterprise. discuss i orL But in considering what other 
matters are to become government functions, it is 
worth while to bear in mind three considerations 
regarding its running of the Post-Office. First: this 
heavy waste of money and of the possible popular ca- 
pacity for improving reading, would be impossible if the 
mails had been carried by private industry for profit. 
Second : mails (for distributing circulars) are carried in all 
considerable cities by private industry in successful 
competition, regarding both prices and efficiency, with 
the national Post-Office. Third: if the mails were 
carried by private corporations, there would be redress 
for failures. This paragraph is written in the country, 
where regular communication with New York is im- 
portant. For four days out of the last five, mails that 

* For most of the facts in this exposition of our postal policy, 
I am indebted to articles by Col. C. W. Burrows in respectively 
Construction (Pittsburg) for June 10, 1905, and the Yale 
Review for February, 1906. 



§ 39°] Extra-Municipal Public Works. 



415 



were due in the morning have not arrived until evening, 
and there is no redress. 

In 1906 the United States government, after printing 
postage-stamps for fourteen years, returned to the 
habit of getting them from private companies, because 
they could make them cheaper. 

In Europe, the post-offices are not confined as nearly 
as ours, to handling written and printed matter: they 
generally do everything that is done by our express 
companies. But that state service is not as good, on 
the whole, as the service of our express companies. 
It is slow and unaccommodating, and apparently the 
rush of American express business would swamp it 
utterly. Moreover, on the Continent, they do not do 
even their work with letters and papers as well as ours 
is done. 

389 (f). Beat 0ur P eo P le write vastly more letters 

where people than any other people, and so they watch 
watch it most the post-office closer (387, 392 c), and de- 
mand higher efficiency* 

390. Telegraph. ^he European and Australasian govern- 
ments do the telegraphing entirely. Their 
services compare very favorably with ours in apparent 
cheapness, but not in actual cheapness. The difference 
is paid, like our postal deficit, out of the government 
budget — ultimately the taxes, of course. 

Despite the importance of our government's mail 
service, it probably would better not go into telegraph- 
ing. One reason is that the people generally would 
not watch telegrams as they do letters : fewer people 
send telegrams. A better reason is that the private com- 
panies on the whole probably do it cheaper. As already 
said, the English government, and probably the others, do 
it as we do our post-office, at a deficit; and the demand 
for telegraphic service is not, like that for mail service, 
of such infinite importance to the education of even 
those who do not use it much, that it would be wise 
to do it at the expense of the taxpayers. 

* Regarding the Post-Office, see also p. 418. 



4i6 



The Promotion of Convenience. 



[§ 39o 



Some of the important tendencies of government 
control of industries were so well and so entertainingly 
summed up in a Washington letter to the New York 
Evening Post during the great coal strike, and carry 
so much instruction regarding the conditions of govern- 
ment work inevitable in the present stage of political 
capacity, that it is well worth while to give space to 
some extracts. A word has been changed here and 
there for the sake of the connection. 

" Suppose the government were in the coal-mining business, 
how would the employees be selected? 

" They would be appointed on the patronage, or influence, 
basis, by quotas according to States ana Congressional districts. 
Then, after the followers of those in political control had been 
given positions, the coal-mines would be put into 'the Classified 
service', to insure a life position practically for the favorites 
thus selected. 

" How would their services terminate? 

"By death. Age or incapacity would not serve as a disquali- 
fication; sympathy for the needs of an employee would prevent 
his severance from the pay-roll, and any civil pension or retire- 
ment fund would be dismissed as un-American. 

" What would be the rate of compensation? 

"In the higher grades of work, too low to obtain the right kind 
of men. And yet it would not be safe to make the compensation 
adequately high, as this would mean a correspondingly enhanced 
prize for the political heelers. In the lower rounds of the 
ladder, however, the compensation would always be consider- 
ably more than in private employment. 

' 4 How would the work of mining be supervised ? 

" There would be permanent and efficient employees, bearing 
the title of 'deputy somebody' or 'administrative assistant 
this', who would get moderate salaries, and upon whom the 
real responsibility would rest. Above them would be a class of 
supervisors, politicians, at about twice the salary, changing 
with the administration of the Federal Government, and 
knowing little or nothing about the business. 

" What would be the relation of the government mines to 
- machinery, and progress in mechanical appliances? 

" One of non-intercourse. 

" Who would look after the details upon which economical 
administration rests? 

" Nobody. It would be unfair to assign any man with a 
political future to so unpopular a position. Hardly any 
economy of administration in a mill or a mine can be suggested 
which does not hurt somebody's feelings or intrench upon 
personal profit or interest. 



§39o] 



Extra-Municipal Public Works. 



417 



"What would be the relation of the mine employees to 
politics ? 

"They would organize into a union, and employ lobbyists 
to intimidate Congress into raising their salaries, extend their 
vacations, and procure for them various privileges. 

44 How would the mine get its supplies? 

"On contract competitive bids where honest men were in 
charge of the administration. Otherwise the specifications 
would go out so worded as to throw business into the hands 
of friends who happened to possess certain articles, or to hold 
an agency or monopoly on them. Then the price would be 
made whatever the traffic could bear. 

" How much would it cost to mine coal under these circum- 
stances ? 

44 From two to three times what it costs now. 
44 Would the American consumers, then, be charged $20 a, 
ton for coal? 

44 By no means; they would be charged $6 a ton, and the 
rest of the cost would be made up through general taxation, 
the methods of bookkeeping employed being such as to disguise 
the operation. 

44 How would the public view such a management of the coal- 
mines ? 

44 With supreme satisfaction. The labor unions would like 
it, because they would have complete control there as against 
disputed control in outside employments. They would cite 
the anthracite mines as a great example, upon the basis of 
which they would ask to have the wood-chopping industry of 
the country absorbed by the Federal Government. Politicians 
would like it because it would give places and positions which 
they could control. The Sunday-school weeklies would teem 
with illustrations of the heroisms of Uncle Sam's servants in 
the coal-mines. Congressional oratory would exhaust itself in 
eulogies of the ability of the government, and of the orator's 
own party, to meet great questions, to do things, to accomplish 
something, and to leave carping and criticism to outsiders and 
Mugwumps. Those who had failed in private business would 
especially derive satisfaction from the thought that, in an 
enterprise in which they were stockholders, the Morgans and 
the Wanamakcrs were being distanced. The patriotic people of 
every class and condition would rejoice in the reflection that 
whatever the United States did was done right. The stray, 
solitary man who challenged this view would be almost ostracised. 
It is better to be a patriot than a pessimist. 

44 Would the operation of these mines lead to application of 
the same principle to the management of beef-raising, or of 
selling groceries? 

44 Undoubtedly. The United States, with its unbounded 
resources, is rich enough to carry the load of wasteful pro- 
duction in a considerable number of industries. 



4i8 



The Protnotion of Convenience. 



[§ 39o 



'^GOVERNMENT MANAGEMENT IN OTHER LINES. 

" Not an answer has been given which is not sustained by an 
abundance of experience in the present dealings of the United 
States Government. We have a printing-office here of 4000 
employees, whose lack of modern machinery and other appliances 
of economical production is such that the printer's art would 
look backward with a vengeance were all the publishing busi- 
ness of the country put on a similarly socialistic basis. The 
control of the labor unions there is absolute. Uniformity of 
work and wages is practically complete. Its employees, selected 
on the spoils basis, have been given permanency by 'civil- 
service reform'. Not a bureau of the Federal Government, 
within present recollection, has been established on any other 
basis. The census clerks were thus employed, and civil- 
service reform only comes in at a late date to act as an em- 
balming agent. The rural free-delivery service has afforded to 
the spoils system a grand debauch, and yet the present Presi- 
dent is a good friend of the merit system. Civil-service reform 
was never healthier than now, and still its practical conquests 
have been small. 

" The Post-Office Department shows some wonderful results 
in the way of celerity, security, and certainty wherever it has 
clung to the coat-tails of private enterprise, as in the fast mail 
trains of our competing railroads, and in its belated employ- 
ment of pneumatic tubes. Wherever it has done things itself 
it has done them badly. It was chased for years by the invent- 
ors of canceling-machines, until finally, surrounded and over- 
come, it most reluctantly surrendered. The private manager 
would have chased the canceling-machine, just as Commodore 
Vanderbilt offered a prize to anybody who would invent the 
brake he needed. 

" No student of postal affairs can take seriously the deficit 
of record. The actual one, with the free rent of millions upon 
millions of dollars' worth of property, owned and cared for ana re- 
paired out of the general funds of the government, would be 
worth while. A score of items enter into the calculation which 
prevent the postal deficit from being regarded as more than a 
pleasant fiction of the Department. The letter-carriers are to-day 
welded into a union, and have sent one of their number, accora- 
ing to current report, to California to try to defeat Congress- 
man Loud for reelection, because he had opposed an increase 
in their salaries. The organization does not suggest that there 
is any lack of competent men at the present rates, but merely 
deems its proper salary that which through political manipula- 
tion it is able to get. And still the post-office is the great 
American idol. 

" The government receives ninety-three cents a pound for 
carrying your letters and postal cards. A private concern 



§39o] 



Extra-Municipal Public Works. 



419 



could afford to pay millions a year for the monopoly privilege 
of carrying letters at half the present rates. The Department is 
* squealing ' all the time because it has to carry the newspapers 
so cheap — a cent a pound — and yet the express companies, 
those boasted monsters of monopoly and watered stock, are 
competing in certain ranges of territory for that very business. 
It is too bad that Australasia is so far away that its pitiable 
and dreary experiments in state socialism may not be more 
readily available for our guidance." 



CHAPTER XXIX. 



PUBLIC WORKS (CONTINUED). 



Municipal * 

391. Street Rail- I* 1 street-car accommodations, America 
leads the great nations immeasurably. 
And yet America did not have the first electric cars. 

391 (a) Evolution G ermanv h ac * ^ e fast* but America has 
00 ° n ' introduced them much the fastest of all 
the countries. Germans wait for their paternal govern- 
ment to take care of them, and governments move 
slowly; Americans see chances to make money, and 
take care of themselves promptly. Germany's having 
the first electric cars did not result from her being 
the European leader in street railways. Great Britain 
was the leader, especially in Scotland. In municipal 
391 (b). Municipal operation, too, she was the leader, but 
ffTn 'in w aa " * n a q uali fi e d wav » lik e that of the French 
little on Continent, railroads (388 a). In 1899, in Scotland, 
m America none. t wo-thirds of the street railways were 
owned by the cities, and leased to the companies oper- 

* In this chapter my obligations to Dr. Albert Shaw's two 
volumes on "Municipal Government" are so many that to 
acknowledge each one would require including his name in 
nearly every page. I am also indebted for much recent informa- 
tion regarding the United States, to Professor Zueblin's 41 Ameri- 
can Municipal Progress", and to the Proceedings of the Na- 
tional Municipal League, especially the volume for 1906. This 
organization well deserves the support of every good citizen, 
and its future volumes may be expected to be mines of valuable 
experience and suggestion. Their usefulness has been increas- 
ing at a geometrical rate. 

420 



§39i b] 



Municipal Public Works. 



421 



ating them; and in England and Ireland, one-third. 
As said before, it is very important to keep in mind 
the difference between municipal ownership and 
municipal operation. The first is almost universally 
approved; the second very widely questioned. 

At first Parliament forbade the cities to operate 
their roads. In 1882 one city — Huddersfield, was per- 
mitted to operate its railways. Since then, up to 1899, 
about twenty cities have obtained the right, and as 
the companies 1 leases are now rapidly falling in, many 
more are applying for it. Towns owning electric 
plants were particularly anxious to use them on their 
railroads, before, in 1899, there began a violent opposition 
to "municipal trading" as they call it (400 h y 414 a). 

Sometime since, London began operating the trams 
in the Southern section. The results have been dis- 
astrous. The net income for the year ending March 31, 
1906, was but a tenth of that from the Northern sec- 
tion, operated by a private company: there appears to 
be abundant evidence of graft — a thing until lately 
almost unknown in London. 

Virtually all the European cities get large revenues 
from the street railways, even when they do not run 
them themselves. The Hamburg railways pay more 
to the city than to their stockholders. 

There is little, if any, municipalization on the Conti- 
nent. But minute regulation for frequency of cars, 
plenty of seating-room, etc., is almost universal. There, 
however, political regulation is easier, and more people 
live in the cities where they work, and even in the same 
buildings, than in Great Britain or America. Therefore 
there is not as great need of street railways or as great 
crowding of them. But if our people were to get more in 
the way of living near their businesses, probably it 
would not relieve the frightful overcrowding and dis- 
comfort of the street railways: for the companies 
would simply run fewer cars; they would not run any 
more cars than they could run at a big profit, until 
they were compelled to. 

This of course is an argument for the cities taking 



422 



Tlie Promotion of Convenience. 



the roads by eminent domain, and operating them, 
but that ought not to be necessary. The cities could 
compel decent accommodations from the companies, 
if the art of politics and the quality of the suffrage 
were up to it : it is done in many places in Europe (426- 
426 b). Already some charters here have made one hope- 
ful condition for safety — that the employees shall have 
enough time for sleep. Our companies have inspectors 
391 (O, Need of constantly walking along their lines or 
constant govern- riding short distances in their cars, to see 

ment inspection. ^ m conducted in the i nteres t 

of the owners. Why should not the people have similar 
inspectors to see that things are conducted in the interest 
of the people — that cars are run with reasonable safety, 
cleanliness, politeness and frequency — not as at present, 
from the Madison Avenue line in New York down through 
most lines in the United States, just infrequently 
enough, even in slack hours, to keep the cars over- 
crowded ? Mayor Cutler of Rochester asks the authority 
to appoint a Commissioner of Public Utilities who shall 
supervise them all, and receive all complaints, with 
power to call for papers and accounts, investigate under 
oath, and redress all grievances. 

Some answers to the question in the preceding para- 
graph are not far to seek: one is the slowness of legis- 
latures and city councils in providing the statutes and 
ordinances obviously required for the public conven- 
ience — a slowness aided by corruption from the com- 
panies. Another reason is the probability that even if 
the laws and the inspectors to help enforce them were 
provided, the inspectors would be bought off. When 
the government is unable to provide even this moderate 
regulation of the roads, what of its capacity to manage 
them entirely? 

391 (d). Municipal In America, until very lately, most of 
adding /* * the cities simply gave away the franchises. 
America, Chicago's street railway franchises are 

easily worth $75,000,000, and the city never had any- 
thing from them. Even during the early years of 
this century, Mayor Arkbridge of Philadelphia ignored 



§39i e ] 



Municipal Public Works. 



423 



a responsible offer of $2,500,000 for privileges which 
were subsequently given to existing companies. Yet 
the companies had before turned all the streets their 
tracks went through, from cobblestones to asphalt. 
Baltimore in i860 sold her franchises for a fifth of 
the fares. Later it was reduced to nine per cent. 
The proceeds take care of all the parks, and have 
already bought several new ones. Cincinnati, Provi- 
dence and Richmond receive five per cent, of the fares. 
Some other cities get revenue from the roads in vari- 
ous ways, and the tendency to do so is becoming 
general. 

391 (e). Ownership The United States has as yet no munici- 
in America. p a j operation. Up to 1907 the only notice- 
able cases even of municipal ownership, were Boston's 
ownership of her subway, and New York's ownership 
of the Brooklyn Bridge railway, both of which the 
cities leased to the operating companies. But New 
York has loaned her credit to a private company 
to build the subway, which, after a long lease, is to be 
accepted in payment of the loan. It is claimed that 
the Boston subway is paying interest on its bonds, and 
has a surplus for a sinking fund that will pay off the prin- 
cipal before the debt matures, leaving the city the valu- 
able source of revenue free of all liability. Early in '99, 
Detroit was preparing to buy all her street railways. 
But the courts had already waked up some opposing 
amendments of the state constitution that were passed 
when the state had heavy losses in the infancy of steam- 
railway building. Unless the constitution is again 
amended, these render government ownership impos- 
sible. Yet the city has lately taken possession of the 
tracks of a new company, with threats to destroy them; 
and the matter is before the courts. In Cleveland in 
1899 the problem was enlarged by a great and destruc- 
tive strike, with dynamite and boycott of people riding 
in the cars. 

Since 1897 Cleveland has been making a fight for 
a three-cent fare. The old combine running the 
street railroads, and running them well, has fought 



4*4 



The Promotion of Convenience. 



[§ 39i * 



the matter up to the United States Supreme Court. 
Mayor "Tom" Johnson has at last developed an inde- 
pendent company running on one street at a three-cent 
fare, and himself acted as motorman on the first car. 
He fought for this line through twenty-five injunctions, 
and the twenty-sixth that is now impending in the 
Supreme Court. If he gets the decision, he will spread 
the new line into regions now monopolized by the old 
company. He forced the old company for a time to 
sell seven tickets for a quarter, and to give a very high 
class of accommodation, but the five-cent fare has 
just been restored. 

San Francisco lately took a line whose franchise had 
expired, but the voters refused to operate it. 

The voters of Seattle in 1906 refused to authorize 
bonds for building municipal car-lines. 

There are two main reasons alleged in favor of 
municipal operation. 

391 (f) Argument First, it is generally realized that mon- 
f or municipal opolies will be run for the benefit of the 
operation. owners, and it is claimed that the only way 

to have them run for the benefit of the public, is for the 
public to do the running The weak point in that reason- 
ing is that here in America, with our large ignorant and 
venal vote, the public is generally run by the politicians, 
so that if the monopolies are nominally run for the 
benefit of the public, they will really be run for the 
benefit of the politicians. 

391*7;. American In *905. Mayor Dunne of Chicago, who 
and European had been elected to municipalize the street 
conditions. railways, got an expert, Mr. Dalrymple, 
over from Glasgow, to get the benefit of his experience. 
His opinion regarding municipal operation in America 
underwent some changes during his stay among us. 
When he arrived, he said: 

' ' I see no reason why Chicago, or any other city in this country, 
should not be able to own its street railways and to run them 
with as much success as we have achieved at Glasgow. I ad- 
mit that the proposition at Chicago is a much larger one than 
the one we had to tackle, but at the bottom it is the same. . . 



§391*1 



Municipal Public Works. 



42 5 



"The people of Glasgow would not go back to the old days 
of private ownership tor anything in the world. I am not 
saying that a company could not do as well by the public. I 
know, in fact, that it could,' but it would be doing so with a 
somewhat different end in view. For a company has always the 
shareholders to consider. And I have to admit that you will 
find people in Glasgow to-day — quite influential people, too — 
who say that the streetcar service is not profitable." 

After he had become acquainted with our democratic 
ways, he said: 

"To put street railroads, gasworks, telephone companies, 
etc., under municipal ownership would be to create a political 
machine in every large city that would be simply impreenable. 
These political machines are already strong enough with their 
control of policemen, firemen, and other office-holders. 

"If, in addition to this, they could control the thousands of 
men employed in the great public-utility corporations, the 
political machines would have a power that could not be over- 
thrown. I came to this country a believer in public ownership 
[operation?]. What I have seen here, and I have studied the 
situation carefully, makes me realize that private ownership 
[operation?] under proper conditions is far better for the citizens 
of American cities. ' 

Chicago is, in 1907, in the very safe position of having 
from the legislature power to own street railways, but 
none to operate them. 

Nevertheless, it is to be considered 
391 (hl eiasgow ' that in the report of the Glasgow 
tramways for the year ending May 1, 1905, prepared 
by this same Mr. Dalrymple, it is stated that 
"the total revenue was £764,790 and the working 
expenses £387,167, which leaves a profit of £377,623 or 
13.6 per cent, on the capital expenditure of £2,763,381." 
These facts are quoted by a writer to the New York 
Times in January, 1906. He adds: 

"Deduct both interest on capital, £59,906, and sinking fund, 
£46,919. Also deduct the local taxes, which have been in- 
creased from £2,485 to £38,316 per annum since the city 
took over the lines, and the £5,434 exacted by the Imperial 
Government as income-tax on the profits, besides the £25,000 
paid to the city chest as a rental for the streets, and remember- 
ing that out of revenue the lines were kept in a perfect state 



426 



The Promotion of Convenience. 



of repair, there was left a surplus absolutely net of £202,038, 
7 per cent, on the capital. 

"The Tramways Committee is so ultra-conservative and so 
anxious that its rich profits shall not be raided too fast for 
'the parks and popular free music' that it puts a part of this 
surplus down in the books as 4 permanent-way renewals fund 
ana depreciation', tho it has provided beforehand both for 
upkeep and sinking fund. 

4 4 The truth is that the municipal street railways are so fabu- 
lously rich that the managers are afraid in some cases to let the 
people know all at once what gold-mines they have got, lest 
they should lose their balance and abolish fares altogether. 
Mr. Bellamy, the able General Manager of the Liverpool system, 
told me in September that on their lines they pay off yearly 
10 per cent, of the real capital cost, tho the city has increased 
the average length of the 2 -cent stage 240 per cent, since it 
acquired the lines, and has reduced the average fare 40 per 
cent., a gain to the traveling public of $1,500,000 a year. 'The 
fact is, Martin', he said, 4 the financial position is so rosy that 
we dare not expose it fully. We are accumulating a surplus 
which will make us impregnable to all the assaults of fortune, 
and then we shall bring down fares with a rush.' " 

391 a). Great There is much evidence on the other 
Britain versus side, as will be seen later. But the con- 

Amenca. Q ^ ey [^ ence does no ^ seem to forbid 

the belief that municipal tramways have succeeded 
in Great Britain. But if there were no conflict at 
all, it would still be far from proved that similar 
success would attend their operation in the United 
States at our present stage of political evolution. Great 
Britain, unlike us, has a restricted municipal suffrage, no 
confusion of national with municipal politics, almost 
entire freedom from municipal graft — at least until 
something like it has begun to appear in connection with 
municipal trading; and a set of social conditions under 
which cooperative trading has grown to great success, 
and even cooperative production has reached some re- 
spectable success — neither of which evidences of coopera- 
tive capacity have our people ever succeeded in demon- 
strating. Farther evidence on the British conditions 
will be given later. 

Mr. Dalrymple's expert opinion, however, loses sight 
of the distinction between ownership and operation, 
and does not necessarily preclude municipal ownership. 



§ 39i k] 



Municipal Public Works. 



427 



The fact seems to be that if politics were sufficiently- 
advanced to own and operate the roads, it would be 
sufficiently advanced to regulate them without owning 
and operating. In Washington, where Congress can do 
anything with the roads that it pleases, and where local 
graft is too small to control Congress, they are run very- 
well. 

The efforts of Mayor Head of Nash- 

391 (j). NashuM: ghow what gQod gov^me^ with . 

out operation, or even ownership, can accomplish. 
About the opening of the century the street-railway 
company claimed a perpetual franchise. After a 
bitter and expensive fight in the courts, he got them 
to agree to sell out at any time after twenty years 
should have elapsed, at a prescribed method of 
valuation, after a year's notice; to pay the city ten 
thousand dollars for failing to keep the streets through 
which they passed in condition during the litigation; 
to give the city a park costing $125,000; to pay the 
city two per cent, of their gross income till it should 
reach a million dollars a year, and three per cent there- 
after; to spend a million and a half dollars in rehabili- 
tating their" plant, which had been permitted to run 
down during the preceding three years; to give uni- 
versal transfers; to run all cars under a central shed 
where transfers could be facilitated; and to keep the 
street between their tracks and for two feet outside, 
in as good condition as the city keeps the rest of the 
streets. The company spent a million more than was 
stipulated, has enabled the city to keep up its parks 
and buy more (it had none before the agreement) ; has 
given good service; and its securities have more than 
doubled in value. 

In Rochester the Board of Health has 
391 (k). Rochester. forced the ra ji ways to provide good cars, 

and has prevented freight-cars from running during 
the crowded hours between 6 a.m. and 8 p.m. In that 
city there were a great many franchises unused, but 
held onto in order to keep competition out, as are 
many municipal franchises of all sorts in England. 



428 



The Promotion of Convenience. 



[§ 39i * 



One strong reason for municipalization is a very sound 
argument for ownership, but hardly touches on opera - 

391 a). The "in- ^ on - ^ * s tnat » as the cities grow, the 
crement" in business of the roads increases, and more- 
franchiaea. Qver . t i ncreases without a proportionate 
increase in the expense — no greater managerial ability is 
needed, and cars are less and less apt to run partly 
filled; in this way, there rolls up a sort of double 
"unearned increment" (74) of which the public should 
have the benefit. 

It may be asked : why is the public any better entitled 
to this unearned increment than to that on land? For 
the very reason that each landowner is entitled to the 
increment on his own land. There is no question about 
the public being the owner (unless it has given it away, 
or sold it, as to the purpose) of the land on which the 
street railway runs — of the instrument which produces 
the increment; and as, when that instrument is a 
natural monopoly, the enthusiasm and competition of 
individual ownership cannot be applied to it anyhow, 
there is no need for the public ever to part with it. 
On the other hand, without the enthusiasm and com- 
petition of individual ownership in ordinary land, we 
would never have got beyond the barbaric conditions 
universal among peoples where private ownership of 
land does not exist (75). 

Should ^ s secur * n g t ^ ie unearned increment of 
ffaJe^birtnot* *" the franchises to the public, much is to be 
^li'JlnL^aZiV said in favor of the recent English method, 

one management. r i at -»r 1 t < 

and that of the New York subway, under 
which the city retains the ownership of the roads, or at 
least of the franchises (it may not be necessary for the 
city to build the roads), and leases them to companies. 
That seems to be better suited to our degree of political 
development, even tho England may be ready for the 
farther step of the cities operating the roads themselves. 
Retaining a share of the receipts, as Baltimore, Cincin- 
nati, Providence, Nashville, Richmond and an increas- 
ing number of other cities do, is only one form of lease. 
There is a reason for the public sharing in profits 



§39i n] 



Municipal Public Works. 



429 



'rather than receipts: sharing receipts, regardless of 
whether a profit were realized or not, would discourage 
making new roads; besides, as already shown, profits 
increase faster than receipts. There is an apparent 
reason the other way, in the fact that bookkeeping can 
juggle profits; but it ought to be easy to guard against 
that. 

To encourage companies to make the roads even if they 
had to give them up in time, the rent could be made 
low because of the reversion, just as in other leases, 
or the lessor could have the option of paying for the 
lessee's improvements or renewing his lease. 

As stated in several cases before, it is desirable that 
the roads of any city should all be under one control, 
to save duplication of roads and managers, and also 
to facilitate transfer tickets. But that need not 
involve the city's running them. In Germany each 
city's roads generally belong to a single company, but 
the city regulates them very well indeed. 

True, the single management prevents the public hav- 
ing the benefit of competition in fares, but the pub- 
lic could not very well have that, anyhow, unless more 
than one road runs through a street, tho of course there 
is room for some competition in parallel streets. Low 
391 (n). Rates of fares can be secured, not only by govern- 
* are ' ment regulation, but also by the tendency 

of a broad-minded management like that of the Metro- 
politan Traction Company in New York in its earlier 
years, to see its own advantage in inviting large business. 
That management, however, has fallen off terribly since 
it was a new broom. Moreover, low fares are often 
secured by the general influence of those vast indis- 
tinguishable agencies which go to make up habit and 
popular opinion. The fares in Columbus are seven for 
25 cents, and in Rockford twenty-five general tickets, or 
fifty school tickets, for $1, and on one line in Cleveland, 
three cents. 

In Glasgow and probably some other places, they 
have "zone" fares, starting very low for a mile from 



43 o The Promotion of Convenience. [§ 391 n 

the centre, and then increasing mile by mile, until 
they run up to ten cents. The result is that the work- 
men do not go to the country, but remain huddled in 
the zones of cheap fares. 

391 fo). Deterio- Altho I have tried to state the situation 
rating 'private fairly, the reader in favor of municipal 

seruice may com- ■ / . * A . *•« , , r « 

pel municipal operation of street railways will probably 
experiment. assume that I have made the best case 
against it that I could. And now (1907), six years 
since I made most of that case, I am bound to confess 
that regarding the rapid-transit roads of my own city 
of New York, I am much less opposed to the experi- 
ment of municipal operation. In stating this, I shall 
probably at least be held free of the charge of saying 
it without a realization of the enormous risks of the 
experiment. When I made my case, the great 

monopolies controlling the roads were newly organized. 
They were more than suspected of holding their fran- 
chises in consequence of great political corruption, and 
they were on their good behavior. Moreover, as already 
said, they were new brooms. Since then they have 
had time to grow careless and indifferent, Tammany 
is again in power, and apparently there is no agency 
to curb their shameless and (it may perhaps be hoped) 
short-sighted avarice. To swell their profits, they have 
introduced obstacles in their system of transfers, and, 
in order to operate only crowded cars, have steadily 
diminished the number of them in slack hours, and of 
those continuing beyond points — such as the Grand Cen- 
tral Depot and the 86th Street car-barns — where many 
passengers disembark, thus forcing many changes and 
waits. At points where it was once easy to find a car 
with an empty seat, nearly every passing car now con- 
tains many passengers holding on to the straps; the 
passenger who once had a good chance for a seat, is now 
often lucky if he can get a foothold on the steps or the 
running-board , the tracks are so poorly cared for, and 
left unsanded, that on going up hill the slipping cars are 
passed by people on foot ; and the motormen frequently 



Municipal Public Works. 



43i 



pass would-be passengers on the few occasions when 
the cars are not full. Early in 1907, the companies 
claimed that many men were laid off by sickness. A 
motorman told me that the men were playing sick 
to get a chance to hunt up better jobs, and concluded: 
"This road has gone onto the bum." The day when 
this is written, I read Dr. Clark's statement that in 
Australasia, a government that did not provide decent 
railroad accommodations could not hold office. True, 
"they manage these things differently in France" (and 
Australasia), but despite the influences controlling elec- 
tions in New York and America generally, the abuses 
of many of our city railroads have reached the point 
where any change of management stands a good chance 
of being a change for the better; and even if one should 
turn out for the worse, it would at least bring with it 
much valuable education. The corruption of all gov- 
ernment agents by the railway corporations is so great, 
that it may make all attempts at mere government 
regulation farcical, and perhaps the corruption in gov- 
ernment operation would be no greater. 

M(p).8om.otner A ? 1 d . 1 7? t be /° re ^ . haVe tHed a11 the 

experiment**: possibilities of regulation, we should not 
BirabiefirBU k e driven to t h e extreme of municipal 
operation. The recommendation already made of 
more commissions for the regulation of private man- 
agement, might be tried for cities, as it has been fbut 
none too effectively) tried for states; and the powers 
and duties and emoluments of the commissions that 
exist, enlarged so as to enable them Cif they will) to 
hold the roads up to the greatest practicable efficiency. 
The commissioners would probably best be elected by 
the people. The state railroad commissions, which 
have not been elected by the people, have generally 
been mere creatures of the railroads, and often appointed 
at their recommendation. Yet the work of railroad 
commissions is easily open to the judgment of the 
people and, if they were elective, to prompt punishment 
for dereliction. That it might be prompt, the term of 
office should be annual, with indefinite eligibility to 



432 



The Promotion of Convenience. 



[§ 39i P 



reelection. If such commissions always fail, the only 
remaining experiment seems to be government operation. 
It should be remembered that under any system of 
mere government regulation, the responsibility is 
divided between the railway corporation and the govern- 
ment; while under government operation, the respon- 
sibility would be upon the government alone, and the 
issue would be clean-cut. That it would be as effective 
and permanent a remedy as the out-and-out advocates 
of municipal operation generally believe, I do not dare 
to hope; .but the logic of events is converting many 
opponents into advocating it, at least as an experi- 
ment. Meanwhile, I let my arguments against it 
stand as they were originally written. They attempt 
to show the dangers of the experiment, and there is 
some slight chance that they may fall under the eyes 
of a person here and there who may have some little 
influence in guarding against those dangers. And 
behind it all, I have a misgiving that the result of the 
experiment, if it is tried before the arguments find 
their natural way to oblivion, may after all only con- 
firm their validity. 

392. Waterworks. ^ e come now to Government's rela- 
tions to waterworks. We find them in 
many of the ruins of early civilizations, especially the 
Roman; and we find the waterworks themselves in 
many primitive civilizations of our own day, in Asia 
and Africa; and we know that all these were or are 
government works, because under the conditions before 
modern civilization, cooperation was never equal to 
such work. 

In modern Europe, especially in the more paternal 
states, municipal ownership is the rule. In America, 
waterworks were generally begun by private com- 
panies, but the tendency has been more and more for 
the municipality to buy out the companies or start its 
own works. In the first half of the nineteenth cen- 
tury, most of the works were private; at its close, 
probably most of them were public. The size of places 



§ 39 2 ^] [Municipal Public Works. 433 



has affected the question materially: the little works 
of small places have been more readily constructed bv 
private capital. The works in cities of over 30,000 
are generally municipal. A peculiarity about water- 
392(a). why m W0I *k s favors this, tho the waste and cor- 
for municipaifza- ruption in building government water- 
twn ' works have often been frightful ; but after 

they are once built they require little management, 
and so afford little field for corruption. 

Yet while water-supplies have sometimes been well 
and economically managed by cities, much — probably 
most of the New York work, has consisted of enormous 
swindles. 

But on the other hand, early in 1900, a gigantic 
corporation loomed up in possession of all the water- 
rights affecting cities of the lower Hudson valley, in- 
cluding New York itself. This attained the proportions 
of a natural monopoly, and public opinion was strongly 
in favor of the municipality forestalling the monopoly. 
The scheme was laid away at least for the time. 
392 (b). Health Waterworks ought at least to be under 
questions, t ^ e absolute control of a Board of Health 

that cannot possibly have any financial interest in them : 
lately Philadelphia and Passaic were full of typhoid 
from their water-supplies, and in Philadelphia, long after 
the remedy was plain, it was impossible to apply it, 
•because rivals who wanted to benefit by the work, got 
the politicians at loggerheads about it. 

Many cities are sorely perplexed over the purity of 
their water-supply. Before Pasteur discovered bacteria, 
it was quite the custom, as in Chicago, for waterside 
cities to empty their sewage into the water to whose 
position they owed their existence, and then, unless the 
water was salt, pump it back to drink. After Pasteur 
taught them where their typhoids came from, they ran 
their sewers, where practicable, a mile or two farther 
out, and drank a higher dilution. They are now learning 
that this will not do, and are struggling with questions 
of inland supply, deep wells, filtration plants and sew- 
age disposal. Probably the best and cheapest solu- 



434 



The Promotion of Convenience. 



[§ 392 b 



tion of the question is one that political capacity has 
not yet risen to. Laws might be passed (in fact some 
have been passed, but neglected, in New York, for in- 
stance,) to prohibit the pollution of fresh water (or of 
salt either, where bathing can be harmed), and requiring 
the rational and even profitable disposal of sewage that 
the soil is crying for ; but it would be very optimistic to 
expect the enforcement of such laws before people be- 
come more intelligent and law-abiding. A minor diffi- 
culty would be that sometimes states would have to 
concur to protect the confluents of a watershed lying in 
both. Such laws would be very interesting experiments, 
however, and perhaps not more hopeless than most 
attempts at betterment by statute. 
392(c). Municipal Waste is a frequent evil. Recently in 
management Liverpool, it was found that two thirds 

naturally wasteful. q[ ^ water tfae ^ 

out again through leaks and taps needlessly left open. 
This is probably about the case in the vast majority 
of American cities to-day, at least where meters are not 
used. Under private management, the company would 
be taking care of its own supply: now the politicians 
take care, and characteristically poor care, of the public's. 

Yet while private companies are apt to do better 
work and at less cost for actual service, it cannot be 
denied that in any sort of service, their interests may 
sometimes conflict with the interests of the com- 
munity: they may render less service than the com- 
munity needs, as was shown in the lack of salt-water 
mains for putting out fires when the San Francisco 
earthquake broke the fresh-water mains from the in- 
terior. The water-supply was the affair of a private 
company which had obstructed providing a supply 
for fires from the bay. 

Waterworks are, of course, generally a natural 
monopoly — competition which involves more than one 
pipe-line in a street, is not practically possible, even 
in large places because of the large size of the mains; 
and has not been at all frequent. Moreover, when it 
is, it is a frightful nuisance from frequent tearing up 



§ 393 a] 



Municipal Public Works. 



435 



of the streets. On the whole, then, municipal water- 
works are to be approved, despite municipal cor- 
ruption, and largely for the same reason that makes 
the Post-Office a success: everybody watches (387, 
389 /) the water-supply, and if it is bad, complains 
and votes against the government. 

Gasworks are cheaper to build than 
393. Ug tng. waterworks, and, perhaps for that reason, 
are not as generally municipalized: so competition is 
more frequent in gas than in water: two or three com- 
panies frequently having gas-pipes in the same street — 
a condition facilitated by their pipes being much smaller 
than water-mains. 

393 (a), craves ^ e argument for municipal ownership, 
municipalization then, is not as strong as for water, espe- 
leas than water. p ec j a Uy w h en we consider that gas is not 
used by everybody, and requires more management 
than water after the works are erected. Cities not 
making their own gas generally charter more than 
one company. In America, of course, they charter as 
many as can bribe the authorities, tho fortunately 
some of the authorities cannot be bribed. In Europe 
generally, people do not have their streets torn up by 
more than one company, and they regulate the prices 
and quality of the gas produced by that one. Ham- 
burg has even leased her own works to a private cor- 
poration, but she keeps her hand on that corporation. 
In all of Germany there is but one city (Frankfort) 
chartering more than one company, and gas is higher 
there than anywhere else in Germany. 

The experience regarding municipal ownership of gas- 
plants, corresponds with the conditions just given. 
Paternal Germany leads off, of course, with a majority 
of the big cities owning gas-plants. The smaller cities, 
as in the case of waterworks with us, (and apparently 
the world over), do not municipalize gas as generally 
as the large ones. Great Britain, notwithstanding it 
is, among European nations, at the other extreme from 
Germany as regards paternalism, nevertheless comes 



43<* 



The Promotion of Convenience. [§ 393 a 



next with proportion of municipal gasworks, they being 
about one in three, and certainly increasing. 

Glasgow and several other Scotch cities, likewise 
some German cities, light the courts, halls and stairs 
of tenement-houses with gas, and Glasgow makes the 
owners pay for most of it. Some cities, tho, spend 
as much for it as in lighting streets — this on the prin- 
ciple, of course, that a light saves a policeman. 

Despite England's lack of paternalism, she comes 
next to Germany in municipalizing gasworks. Public 
opinion demands them in both those countries more 
generally than in the rest of Europe, there being a 
larger proportion of people given to reading, who 
want abundant light, and who can afford to pay for it. 
393^; cheapened Apparently municipal ownership has 
by it in some cheapened gas in Great Britain and Ger- 

piaces in Europe. many It . g sup p Hed as Iow ag 

twenty-five cents, while in America it is often above 
a dollar. But it may be even yet too early to be sure 
that it is not cheapened in Great Britain and Ger- 
many by an increase of taxation. In London at the 
time of writing, the gas is very bad. 

Whether we would better adopt municipalization on 
the chances, we can tell better after we have attained 
decent government. If most of our present city govern- 
ments were giving us gas for fifty cents, they would 
be adding more than another fifty cents to our tax- 
bills, by corruption in the works. 

We have not had much experience in that sort of 
finance in America, in connection with gas, because 
there have been few municipal plants. - But the book- 
keeping for gas and water and electricity has been 
393 (c). American' something fearful and wonderful in the 
tuTiZZfnTy* direction of trying to show a profit. Pub- 
diacouraging lished reports are very unreliable. The 
mayor of Philadelphia lately reported a year's profit 
of Si 60,000 on gas, while a Massachusetts committee 
investigating Philadelphia experience for their own 
guidance, reported a loss of $1,000,000.* The gen- 
* Daniels, op cit. 



§ 393 dl Municipal Public Works. 



437 



eral American experience in municipalities operating 
gas-plants, has been very slight: people are too afraid 
of the political rings, and the rings can get too much 
out of the existing companies for letting them alone. 
A few towns have bought their local gasworks within 
the last score of years; but on the whole, people do 
not trust universal-suffrage government far enough to 
want to disturb, in its favor, the existing state of 
affairs. Richmond and Philadelphia have long had 
their own works, but tho Philadelphia has owned hers 
for more than half a century, she has lately leased 
them to a private corporation, municipal management 
being a failure, probably owing to corruption. The 
lease fell in in 1905, and was renewed for seventy- 
five years, by a corrupt government on terms that the 
community would not stand, and the government was 
ousted in consequence. Toledo, after ten years' use 
of a municipal natural-gas plant, leased it to a private 
company at a rental insufficient to pay interest on a 
seventh of what it cost, and finally sold it at a tenth 
of its cost. Corruption was suspected in both transac- 
tions. 

By 1905, the lighting of New York had become so 
monopolized that, at the time of this writing, many 
citizens who distrust that city's capacity to manage an 
industry, think a municipal lighting plant would be 
better risked than a continuation of existing conditions. 
And the same condition is rapidly developing regarding 
the surface railways. 

393 (d). Peculiar There seems no doubt that the Rich- 
caw in Richmond. mon d f Virginia, public gas-plant had more 
than paid for itself over twenty years ago, has paid 
into the city treasury over $300,000, has reduced the 
price of gas from $1.50 to $1.00, and has furnished 
free gas for streets and public buildings, worth $500,000 
more.* All of which proves much municipal political 
capacity in Richmond, but unfortunately does not prove 
it anywhere else. 



* Zueblin, op. cit. 



43» 



The Promotion of Convenience. [§ 393 d 



Since the foregoing paragraph was written, the Rich- 
mond bookkeeping has been proved fallacious, the 
works have been proved to have been run at a loss, 
and to need renovation. But I let the paragraph stand 
as one more illustration of the uncertainty of evidence 
in these matters. 

393 (eh other In Cleveland the gas company pays into 
American cities, the c jty treasury 6 J per cent. — Professor 
Zueblin does not say whether of receipts or profits — 
probably not thinking it any more worth looking up 
than I do. The people have just voted against 
municipal electricity. 

Until this year, 1907, Hamilton, Ohio, was very 
proud of her municipally operated gas and electric 
plants. The state auditor now reports that from 
Jan. 1, '03, to Jan. 1, '06, $35,000 dead claims had 
accumulated, and a debt of $13,431; that the adminis- 
tration was 

"marked with evidence of mismanagement, extravagance and 
unbusinesslike methods . . . the employment of inexperienced 
men [with pulls?] to superintend important work where both 
mechanical and electrical skill were necessary . . . cost of 
production at times exceeded the schedule rates charged for 
the service. ..." 

Stubs and original memoranda of various kinds were 
missing, there was a shortage in the secretary's accounts, 
and the surety bonds of many officials had not been 
renewed in years. In the words of the report: 

"Officials, ex-officials, prominent citizens and others were 
enjoying free service; while these accounts were duly charged 
on the books, apparently no effort had been made toward 
their collection or adjustment. Several individual accounts 
ranged from one hundred to eleven hundred dollars." 

It need hardly be reiterated that the truth as to the 
success of gas municipalization so far, is hard to get at. 
In Chicago, for instance, chartered accountants claim 
that the municipal gas-plant has been running at a loss, 
while the mayor claims that it has been running at a 
profit. 



§393/1 



Municipal Public Works. 



439 



Dr. Bemis (quoted by Professor Zueblin) says that all 
the municipal gas-plants are succeeding. It is edifying 
.to have such definite information regarding the Phila- 
delphia one (which Professor Zueblin, after quoting 
Dr. Bemis, says "was the football of politics . . . 
over half a century"), not to speak of those of Rich- 
mond, Toledo and Hamilton — so edifying as to give 
some impression of the quality of the information 
regarding the others. Other authorities say that the 
desire of the authorities to make a good showing, 
combined with bad systems of bookkeeping, make it 
impossible to tell whether they are succeeding or not. 

In short, there had been no magic in municipal 
operation to make it different from the operation 
previously quite general in American cities. 

Professor Zueblin states that "in Great Britain . . . 
over 100,000,000,000 cubic feet are consumed by half 
the number of people that consume 50,000,000,000 in 
this country". This he attributes to municipal opera- 
tion. Whether it is at the expense of the taxpayers 
he does not say, perhaps because nobody knows yet, 
tho there is a growing suspicion that it is, — and Pro- 
fessor Zueblin plainly thinks that it ought to be ! 
393 (f). Oenerat Cities can do something for the gas- 
considerations. supply without owning it : they can keep 
it up to standard and regulate prices — the German cities 
and many others do that without needing competition 
(393 a ) • Some of the German cities have their gas tested 
every day, but that is probably more than many of our 
cities could do with any confidence in, the test. 

Besides the argument (which may not exist) of cheap- 
ness of gas and water, if people think it is cheap, or get 
their supply at a fixed price, as is generally often the 
case with municipalized water, they will use more, and 
that is good for them. Moreover, for light, a munici- 
pality is sure of at least one very valuable customer — 
namely itself. Some Continental cities use nearly 
quarter of what is made, but that looks as if the people 
did not use as much privately as the English, or even 
our people, do. 



44° 



The Protection of Rights. 



[§ 393 £ 



393 (g) £/«*• As to electricity, no existing state of 
tricity. affairs had to be disturbed to municipa- 

lize it: so our people have municipalized it much more 
generally than gas. Yet the results are doubtful. 

Duluth claims to have saved its people in seven 
years $631,000 in reductions of rates on water and gas, 
and to have accumulated and invested in extending 
the systems, $121,000. 

Detroit claims that in the ten years ending with 
June, 1895, she lit her streets at $1 less per arc light 
per year than Buffalo, and paid out of profits for a 
million-dollar plant. 

Logansport, Indiana, claims to have provided the 
people with good electric light at a moderate price 
since 1894, to have had all city lighting in streets and 
public buildings free, and to have paid out of proceeds 
$100,000 for increase of plant. 

Jacksonville, Fla., claims to have, during about 
eleven years preceding 1906, reduced prices of elec- 
tricity to citizens, 75 per cent., and paid out of profits 
for $365,000 worth of plant, plus interest on such bonds 
as were issued at the start. 

On the other hand, after trying the municipal electric 
street -lighting plant for eighteen years, the people of 
Easton, Pa., are demanding that the city councils 
abandon it and procure lighting from the private cor- 
poration. Mayor March, who advocates municipal 
ownership when it can give efficient service, has declared 
that the condition of the streets of the city through 
defective lighting is dangerous from a police point of 
view and unbearable from the point of view of the 
citizen, and favors private service. 

Offers have been made by private corporations at 
$15 a year less per lamp than it now costs the city for 
the service which is causing constant complaint. It is 
estimated that the city has thrown away for several years 
from $4,000 to $5,000 a year in maintaining the plant. 

"Mayor March says: "If we intend to continue light- 
ing the city by our own plant, we must run the plant 
as a private corporation would run it, not only with 



§ 393 g] 



Municipal Public Works. 



441 



economy, but also by constantly repairing and renewing 
the machinery to keep up its efficiency. This has not 
been done. I feel that public opinion will insist upon 
the streets being lighted by a private company because 
the public, as well as I, believe it can be done for far 
less expense than it is being done by the city." 

Select Councilman David W. Nevin says: "In my 
opinion the operation of municipal plants amounts 
merely to the creation of a number of places to be 
filled by local politicians. These men get salaries, but 
have no interest in the plants as long as they continue 
their 'pulls' and hold their jobs/' 

That same Mayor Head of Nashville whose experi- 
ence with the city railroads was given, proved again 
in relation to light what municipal regulation without 
even ownership, may accomplish. By judicious work 
in the legislature he got the gas company to reduce 
its price from Si. 50 per thousand feet to $1, and its 
stock has risen from ninety cents to a dollar and a 
quarter. 

• He says * that when he began building a municipal 
electric plant, the existing company reduced its rates 
from eighteen cents to twelve, and made many con- 
tracts at six. He ultimately took over the street- 
lighting from them, and did it the first year twice as 
freely as they had the preceding year, at a cost of 
$33,500, as against their charge of $49,270. 

In 1 90 1 the aldermen of Worcester, Mass., found that 
in all the cities from which they could get reliable data, 
the cost of electricity from municipal plants averaged 
3.4 cents per lamp-hour, while Worcester was paying a 
private corporation 2.8. 

In 1906, Alexandria, Va., sold for $3000 an electric 
plant which had cost $17,000, four Indiana cities were 
looking for customers for theirs, and Cleveland had 
voted against Mayor Tom Johnson's recommendation 
to make one. On the other hand, many American cities 
were claiming success for municipal electric-lighting 

* Proceedings of National Municipal League, 1906. 



393(h). Eiec- But not everybody us 

tneity versus gas. f ar> not nea rly as many" a 

justification, then, for municipalizing i 
obvious. But it is incomparably the 
and economizes police expenses, and 
the electric light has rendered many a 
great police care failed to. Municip 
purposes would, then, perhaps be just: 
measure, and possibly private supply 
along with street supply. 



393 «). Major — Rearing on the com 
Darwin on utuitiu considered, and one — hot 

rtwrffftMM. be considered later ( 43I 

Major Leonard Darwin's "Municipal ' 
1903) shows that from March 31, 181 
1902, municipal waterworks, gasworks 
kets and some minor undertakings 
ducted at apparent profits, while elec 
and wash-houses, burial-grounds, world] 
harbors, piers, docks and quays, have t 
apparent losses. But he does not co 
entirely reliable, and his general atti 
American experience confirms — that tl 
bookkeeping is, very naturally, to thro 
in favor of profit. 



'P'horo "hoc Kpoh rt crr\r\r\ 



§ 395] 



Municipal Public Works. 



443 



business to manage decently, of which I have knowl- 
edge. How, then, about the fitness of the governments 
to undertake it. It is doubtful whether its real usefulness 
is wide enough to strongly justify government being 
burdened with it ? But there is no doubt that it is essen- 
tially a monopoly: for competition seems next to im- 
possible, because every user wants to reach every other 
user, and the service would be almost useless if split 
up among several companies. Therefore if government 
ever becomes fit to control this most difficult of con- 
veniences, the telephone might properly be among the 
first undertaken. 

Now as long as there is private competi- 
395. Tearing up tion in water, gas and electric conduits 

streets. Tunnels r n i • j • x • j. 

for pipes, wires, etc. of all kinds, it is a great nuisance to 
doubly or trebly tear up the streets to 
enable several companies to construct and repair their 
conduits, and it not only is ugly and obstructive to 
travel, but it spreads malaria. It is too late to effect 
all the economies that were once possible, by combining 
into a trust all the companies dealing in any one of the 
commodities, as now is frequently done with new ones, 
because the competing companies have already torn 
many towns to pieces, and wasted a great deal of money 
in duplicating each other's works. But any trust that 
may be made, need not continue using all the pipes, 
and tearing up to keep them in repair; but if it does 
not use all, it would have to tear up for new connections 
to replace the discarded ones; and so far as it does 
not use all, there would have been just that much 
waste. 

For gas and water both (not to speak of sewerage, 
electricity and pneumatic tubes) there is everywhere a 
most painful need for a central combination to put 
all the conduits in each street into one good tunnel, 
abundantly large and convenient, where they could be 
placed as needed, and taken out and repaired without 
the inconvenience, waste and sickness always due to 
disturbing the streets. Some of the London underground 



444 



The Promotion of Convenience. 



[§ 395 



railway tunnels carry pipes and are, on the whole, success- 
ful in it. Paris has a pipe system in some of its sewers. 
It is not as complete as it might be, but very admirable 
as far as it goes. Paris puts the gas-pipes and electric 
wires under the sidewalks instead of the roadway. 
Milan in its splendid new Via Dante has galleries under 
the sidewalks and right by the houses, for everything 
except the sewerage: that goes under the roadway 
as usual. New York has lately built a few "pipe 
galleries" in connection with the subway railroads, but 
of course not as many as there ought to have been, and 
the specifications for the new subways require them 
throughout. 

As the concert of action necessary for pipe galleries 
cannot be had from half a dozen independent companies 
squabbling over each of the conveniences, pipe-gallery 
or tunnel companies may be chartered, but by the time 
a city needs them, the then existing gas and water com- 
panies would fight against moving their own pipes: 
so after all, the only way to get the best results would 
seem to be for the city to own all the interests (it need 
not operate any) or at least the tunnels or galleries, and 
compel their use. For the government to take the 
whole lot by eminent domain, and fix them up right, 
once for all, would certainly be the best solution — for 
any government fit to do it without the frightful waste 
and corruption of most government work in American 
rifles. Tunnels would probably cost American tax- 
payers many times what they ought to, but they might 
be worth having at the price, or for reasons of health, 
at almost any price. 

Most American cities let companies use their streets 
for pipes and wires without paying for the privilege; 
most European cities get large revenues from them: 
so probably, without municipalizing so far as to have 
the cities do the work of the companies, it might be 
well to make municipal tunnels, and charge the com- 
panies for the use of them. 

Kansas City gets ten cents per foot per year for the 
privilege of laying down conduits for wires. 



§397] 



Municipal Public Works. 



445 



396. Advertising One very novel and useful source of 
s, ? ns ' revenue, in Berlin, comes from regulating 

advertising signs. The city keeps them in good taste, 
and gets seventy thousand dollars a year for the privileges 
of them. Of course such a proceeding is still far beyond 
our political capacity. 

397 Summar Professor Daniels ("Public Finance", 

ummary. Edition of 1 899, pp. 277-9) admirably 
summarizes conclusions on the topics of this chapter 
as below. Up to 1907 the aspects of the case are not 
materially changed, tho farther developed, as we shall 
see in the next chapter. 

"A careful sifting of the evidence presented on both sides 
seems to establish the following conclusions as highly probable : 
(1) The price charged by private companies for the supply of 
water exceeds by twenty-live to forty-three per cent, the 
price charged by municipal waterworks; (2) the cost of the 
water-supply by municipalities probably exceeds the cost 
incurred by private companies, tho how far the increased cost 
augments general taxes it is difficult to say ; (3) while the price 
of gas in England under both systems is markedly less than the 
price of gas under cither system in the United States, the rate 
of reduction in gas prices in the United States since 1870 seems 
to have been more rapid than in England; (4) the cost of pro- 
ducing gas has probably been less under private than under 
public management. ... It is practically certain that muni- 
cipalities have paid more than private companies for labor both 
in England and in the United States. *This failing', says Pro- 
fessor Bemis naively, 'if it be a failing, is quite common in 
public works. Many consider it an advantage for public works 
thus to set the example of good wages.' Our complacency on 
this score might perhaps be just if the example set by our 
public works were uniformly an example of good wages for 
good work. When, as is so common, the practice of our public 
works amounts to high pay for the inefficient service of party 
hacks, the 'advantage' of such a policy is more than dubious. 
(5) The price charged for gas by public companies in England 
appears to be less by seven or eight per cent, than the charge 
made by private companies, but no such general assertion can 
be made with respect to the United States; (6) public electric- 
light plants in this country cannot be said generally to furnish 
electricity at a lower cost or price than private companies. 
The evidence rather tends to show that the advantage lies with 
private companies, especially as long as electrical apparatus is 



446 The Promotion of Convenience. [§ 397 

evidently In the transitional stage. (7) Local transportation 
has been undertaken by several British municipalities with 
varying success. In this country it is as yet untried. When 
all circumstances are taken into consideration it would appear 
that our transportation service is not only immeasurably more 
efficient than the British tramway service, but that the charges 
for distance traversed are really less in the United States 
than upon the most successful of municipal lines in Great 
Britain." 



CHAPTER XXX. 



LATEST ASPECTS OP GOVERNMENT OPERATION. 

Most of the preceding treatment of the problems of 
municipalization was written in 1900, tho I have tried 
to bring its details up to date. As to general conclu- 
sions, those of Professor Daniels were stated in 1899. 
These words are written late in 1906. On searching 
for evidence of what has happened during the inter- 
vening time, I have been surprised to find how scant 
and conflicting it is. Two things are plain — the efflores- 
cence of municipalization up to 1890 has met with a 
serious blight; and the testimony on the subject is 
colored by that difference between men 

^Jiifan"! 81 ' Md which bears the names of Plato and Aris- 
totle, but which began long before them. 

The idealists find municipalization triumphant, the men 
of facts find no sufficient evidence that it is. 

In Great Britain, the advocates of municipal operation 
say that the statistics abundantly prove its success. 
The opponents say that they do not. Professor Daniels 
doubts whether "any real financial profit whatever has 
399. Major Darwin emerged". Major Darwin* thinks that 
to 1903. " the net result to the nation will be neither 

a considerable financial loss nor a considerable financial 
gain". The report of the Parliamentary Committee 
already alluded to shows little confidence in the statistics 
either way, saying: "The auditors are not accountants, 

* Op. cit. The most detailed work yet given to the subject. 

447 



448 



The Promotion of Convenience. 



[§399 



and are not, in the opinion of the committee, properly- 
qualified to discharge the duties which should devolve 
upon them." Major Darwin supports most of the con- 
victions already set forth. 

"In the United States . . . the balance of advantages and 
disadvantages tells heavily against Municipal Trade. ... In 
England, Municipal Trade is more likely than private enter- 
prise to introduce corruption. ... As regards gasworks, the 
results have been shown to be faulty. . . . No material gain 
or loss has directly resulted from Municipal Trade, altho taxa- 
tion is now being increased thereby. . . . The arguments are 
telling strongly against Municipal House-building. . . . Local 
authorities are advancing too rapidly in the paths of Municipal 
Trade." 

He agrees with Lord Avebury's opinion that so far 

"There can indeed be little doubt that there are fewer work- 
men's dwellings now than there would have been if the muni- 
cipalities had not built any. ... As regards house operations, 
a particularly strong case can be made against this work being 
largely entrusted to municipal employees ; that it would "be 
most unwise to base our policy for the future on the hope of 
any financial benefits to either consumers or ratepayers from 
Municipal Trade " ; that " as regards ordinary competitive trades, 
the case for municipal trade in fact breaks down utterly"; 
that "the logical thing to do would be to establish a separate 
elected body for the management of such enterprises, the 
number of votes to be given by each voter being solely based 
on the amount of the rates paid by him" (an approach to the 
recommendations of the Tilden Commission in New York), and 
that "Local Authorities in England . . . have gone too far in 
certain directions in their acceptance of socialist ideas." He 
quotes John Stuart Mill to the effect that "the reasons in favor 
of leaving to voluntary associations all such things as they are 
competent to perform, would exist in equal strength if it were 
certain that the work itself would be as well or better done by 
public officers", the reasons being "the mischief of overloading 
the chief functionaries of government with demands on their 
attention, and diverting them from duties which they alone 
can discharge, to objects which can be sufficiently well attained 
without them; the danger of unnecessarily swelling the direct 
power and direct influence of government, . . . and the inex- 
pediency of concentrating in a dominant bureaucracy all the 
skill and experience in the management of large interests, and 
all the power of organized action existing in the community ; a 
practice which keeps the citizen in a relation to the government 
like that of children to their guardians, and is a main cause 



§ 400] Latest Aspects of Government Operation. 



449 



of the inferior capacity for political life which has hitherto 
characterized the over-governed countries of the Continent." 

400. Municipal ^he ver y ^ atest contributor of British 
operation, retarding experience is Professor Hugo R. Meyer.* 
eveopment t ^ es ^ s i s that municipal operation 

retards and limits the supplying of facilities, in fact 
often prevents them. This he illustrates by the general 
facts that Great Britain, where that system exists much 
more widely than with us, has proportionally about 
one-quarter the street-railway facilities, one-third the 
electric-lighting facilities, and less than one-quarter the 
telephone facilities that are enjoyed in the United States, 
where these matters have been left to private initiative. 
Glasgow, the banner city of municipal railways, has, 
in proportion to population, but one-third the facilities 
of Boston, and, distance being considered (only relatively, 
Glasgow has no distance, the roads not going far from 
the center), the fares are, in labor cost, much higher' 
than those of Boston. In consequence of the backward- 
ness of these industries, Professor Meyer claims, 120,000 
British people have missed opportunities of employment, 
and been forced to emigration or unemployment; and 
that so far as electric machinery is concerned, England 
has lost her old place as one of the world's chief sources 
of supply for mechanical apparatus. 

Professor Meyer seems to prove that the facts (of 
which there can be no question) result from the cause 
to which he attributes them. The most obvious and 
incontrovertible of his arguments is that a city owning 
a plant for any purpose, must attack itself to introduce a 
new one or a substitute; while, if a plant is owned by a 
private company, a competing company feels no tender- 
ness for it. Private companies not only find in compe- 
tition their very reason for existence, but are notoriously 
readier than government bodies to adopt improvements : 
the Boston Elevated Railway Company, according to 

* " Municipal Ownership in Great Britain" (1906), a work to 
which 1 am greatly indebted. 



The Promotion of Convenience. 



[§ 400 



Professor Meyer, "scrapped" four equipments of motors 
in twelve years. The effect of this consideration in 
making the British cities owning gas-plants, oppose the 
introduction of electricity, is shown in the figures 
already given. Another obvious consideration is of 
course the comparative slowness of all government 
operations, as compared with those impelled by self- 
interest. Mr. Farrar, for nearly twenty years Secre- 
tary of the Board of Trade (quoted by Professor Meyer), 
said in 1883: 

"All experience shows that whilst capital will always . . . 
support a new invention, if there is prospect of success, there 
is no such active motive power on the part of governing bodies; 
they take up a thing when it is done, but they are not persons 
generally willing, nor perhaps are they the best persons, to take 
up a new invention." 

The claim that leaving government to 
tEl?m$ig2??' tn supply facilities, often means not supply- 
ing them at all, is proved by many in- 
stances where municipalities have obtained from 
Parliament (which in such matters virtually performs 
the functions of our state governments) powers to do all 
sorts of things, in order to keep private companies from 
doing them, and have not done them at all. When a 
municipality has parliamentary sanction to undertake a 
matter of the kind, no other agency can do it within the 
limits. In October '99 over a hundred local govern- 
ments which had obtained such sanctions were not using 
them, and of course not permitting anybody else to do 
the service. 

Professor Meyer also cites several instances of the 
Association of Municipal Corporations and the Associa- 
tion of Urban District Councils, blocking schemes for 
supplying large territory with light and power at the low 
rates possible only to large operations, because of fear 
that the companies would underbid the municipalities. 
Yet in several cases the districts thus deprived of cheap 
supply, contained municipalities which had no supply 
at all. A striking instance (I forget whether I found it 



§ 4oo c] Latest Aspects of Government Operation. 451 



400 (b). English m Meyer) is the killing by the municipali- 
municipaiization ties of a private scheme to light some thir- 
obitructiu: teen hundred square miles very cheaply 
from the coal-fields, while of the whole thirteen hundred 
square miles, under four square miles were lighted by 
the municipalities themselves. This recalls what we 
have seen of townships obstructing American through 
roads (384 c). These associations were even including 
in the tax-bills, the expenses of agitating to deprive the 
taxpayers of the benefit of competition. The attitude of 
the municipal governments regarding all private initi- 
ative, is like the jealous opposition of the ignorant classes 
to "capital" and "corporations". For example, in 
1905, Bethnal Green, a London borough of 130,000 
inhabitants, had no light. Its representative in Par- 
liament did not want it "at the mercy of a dividend- 
earning company", as it was "notorious that the 
United States" municipalities were. In the House 
400fc;. stran- °* Commons in 1900, Mr. Macdona said: 
giing p'rioaf " There is a feeling in the country that the 
interpriae. municipalities are organizing themselves 
into a gigantic monopoly with a view to strangling pri- 
vate enterprise." Aldermen Bussey of Poplar (169,000 
inhabitants) said before a committee of the House of 
Lords in 1905, that his town "would not take current 
from a company at a lower rate than the town could 
supply it", tho the company offered it at a third less. 
In this debate, so eminent a man as John Burns con- 
tributed the specimen of Labor logic that cheapening 
the current would increase the number of the unem- 
ployed. • 

When existing companies go to Parliament for re- 
newed charters, or for increased facilities of any kind, 
the municipalities often oppose power to increase capi- 
tal to extend tracks or conduits, and thus force the 
companies to sell out to them cheap; and then for 
the private policy of expansion, comes the municipal 
policy of sitting still. Professor Meyer quotes Mr. 
Leigh, counsel to the Speaker and chairman of Com- 
mittees of the House of Commons, as saying in 1900: 



452 



The Promotion of Convenience. 



[§ 400 £ 



"Municipalities never invented or initiated anything, either 
with regard to tramways or gas or electric lighting, and yet 
when a company has become flourishing, they have been rather 
forced in a corner to sell their undertaking. . . . [The munici- 
palities] have not come in for the purpose of helping . . . when 
a gas undertaking has been badly carried on, but they have 
pounced upon gas companies when they were paying their full 
dividend." 

It is not surprising, then, that Professor Meyer 
has to admit that "in the year 1898-99 all but 48 of 
the 222 municipal gas-plants of the United Kingdom 
paid the interest and sinking-fund payments properly 
charged against them ". He repeats the well-known 
fact that the alleged low rates of the British city rail- 
ways are only for narrow centers and narrow zones 
around them, and calls attention to the consideration 
that municipalities, with the universally recognized 
inertness of such bodies, are very slow to extend their 
lines, and thus leave a frightful degree of overcrowding 
in cities of a grade that, with us, are not overcrowded 
appreciably. \ 

400 (d). Fran- The leading obstruction to private in&tia- 
chUes too short. t j ve j^g b een a too ea ger demand Vor 

municipal ownership. The law of 1882 denied electrrtc- 
light companies sure possession of their plants for mor e 
than sixteen years, at the end of which time the munrV 
cipalities had the privilege of buying. This of course 
made enterprisers very slow to risk furnishing the 
facilities. The slow development under such a system 
led to a new law in 1888 postponing the privilege of 
purchase to the end of forty-two years. Bach bill 
allowed for shorter terms under special circumstances. 
Tramway companies were similarly hampered by too 
great eagerness for municipal ownership, purchasing 
privileges varying from fourteen to forty-two years. 
Permission for cable power was at first given only for 
periods of seven years. All were farther hampered by 
sundry restrictions of detail. 

I wrote, some pages back, that virtually nobody 
opposes municipal ownership, but I had nut then read 



§ 4°og] Latest Aspects of Government Operation. 453 



Professor Meyer's book, and learned that these ex- 
400 owner- aggerated efforts to apply the principle 
ship loaded with had made him an opponent of it root 
operation branch; but apparently municipal 

ownership in Great Britain practically means municipal 
operation, and the trouble begins there. There are very 
few good principles where too eager enthusiasm cannot 
be as harmful as absolute neglect. 

Results ^* ie resu ^ °^ *he British policy was 
in number of that in 1888 there were two electric-lighting 
Td^hones. P lants at work-in England; in Germany, 
under an unduly grasping policy of muni- 
cipal ownership like that of England, there were fifteen; 
in the United States there were five hundred and seventy- 
four. When, in 1888, the privilege of compulsory pur- 
chase by the municipality was limited in England to 
forty-two years, private companies began work at once, 
and were very largely bought out by municipalities on 
mutually satisfactory terms. Yet with all the municipal 
operation, the light is not yet in nearly as large a pro- 
portion of places, or used by nearly as large a propor- 
tion of people, as in the United States. 

The British policy regarding the telephone has been 
the same as regarding tramways and light. The 
government deliberately paralyzed the telephone in its 
earlier years, to protect the government-owned telegraph, 
just as the municipalities paralyzed electric lighting to 
protect their gas-plants. The result is a proportional 
use of the telephone not over -a fourth that in the 
United States. 

400 (g). "Poii- The associations of municipal govern- 
ti08 -" ments have great power in Parliament, 

and block nearly all efforts of private initiative. With 
the greater openness of our legislatures to politics, 
the conditions here, with municipalities widely operating 
the franchises, would be worse. 

The matter is eating out the old purity of English 
municipal government, and reducing it toward the level 
of ours. The number of laborers in municipal employ 



454 



The Promotion of Convenience. 



[§ 400 ft 



400 (k). English has of course been enormously increased 
municipalization by the municipal tramways, electric com- 

dangeroua to the J r , J ,U, t , 

purity of govern- panies, gas companies, etc. These laborers , 
ment. ^ike ourS) are casting solid votes for the 

administration in power, while the administration 
is open to the corruptions which big salary lists have 
injected into our own politics * (388 m). Local politics 
mans public works by favoritism. The Lord Provost 
of Edinburgh said to the correspondent of the Chicago 
Tribune (I am still following Professor Meyer): "So 
long as the road is under municipal management, there 
is always a temptation to provide employment in some 
way for political hangers-on. . . 

Professor Meyer quotes several eminent Britons to the 
effect that the employees of the various municipal plants 
are already exercising a dangerous influence in politics. 
Some publicists propose that they shall be disfranchised, 

* I am largely indebted for English experience to an important 
letter from Mr. Robert P. Porter in the New York Times tor 
October 31, 1899, and to a friend from Glasgow whose family 
has furnished the city at least one provost, and who tells me 
that objection to municipal trading is rapidly growing, because 
of the corruption it breeds. The latter sends a copy of the Glas- 
gow Herald which says: "The citizens of Glasgow may again 
congratulate themselves upon having had a narrow escape. 
By 28 votes to 17, they have been saved from embarking on the 
perilous enterprise 01 Municipal Banking." He also writes, 
September 8, 1900: "Our rulers are emulous to become bankers 
as well as purveyors of water, light, power, telephones and 
much else, and owners of a tramway system. There is a 
growing sense of danger in Glasgow, due to rapidly increasing 
taxation occasioned by the enterprise of our city fathers. Two- 
pence on the pound of rental has just been added to the rates, 
and with increasing municipal liabilities there is prospect of 
further rise. Meantime our streets are badly paved, and are 
like to remain so as long as our rulers find they can gain greater 
distinction by proposing banking schemes than by attending to 
the streets. The lighting of the city is also not good. Lighting 
costs money and docs not bring glory." The "glory" 
sought for by the "city father", seems to be rapidly becoming 
simply the glory of voting conveniences to the proletariat at 
the expense of producers. 

The side against municipal trading was also presented by Lord 
Avebury in the Contemporary Review for July, 1900. He was 
answered by Mr. Robert Donald in the next number. 



§ 4°°/] Latest Aspects of Government Operation. 455 



on the same ground that regular soldiers are disfranchised 
in most countries civilized enough to have a suffrage. 
Whether the municipal employees will be worse than our 
exploiters of franchises, remains to be seen. But we 
at least get the facilities to a degree that Great Britain 
is not within sight of. 

Professor Meyer claims that municipal plant generally 
costs more to build than private plant. Some other 
observers claim differently. That municipal wages tend 
to surpass others, is matter of notoriety, even in the 
United States. 

Professor Meyer wisely concludes that 

" Industrial progress comes not from the 
400 0), Leaves people at large, wnether acting as individuals 
out th9 able man. or in the corporate capacity of state or city. 

It comes solely from a comparatively small body 
of men of unusual imagination, daring, power of persuasion 
and executive ability. Those men see, or believe they see, 
possibilities of development and new ways of doing things, 
where the average man sees naught but the possibility of failure. 
They have the courage of their convictions, as well as the 
power to infuse that courage into others — the possessors of the 
capital without which no new idea and no invention can be 
tested and developed. Finally, the men in question have 
executive ability, which is the power to plan, and the ability 
to select the men who can be trusted with the execution of their 
plans." 

From the chaos of statistics regarding municipal 
trading in Great Britain, two facts stand out in un- 
questioned clearness. Taxation and debt have enor- 
mously increased. Advocates claim that assets have 
been gained to offset the debt, and advantages to offset 
the taxation. Many judges of high and passionless 
authority deny both statements, and there is much 
evidence that while assets are carried in the accounts 
at cost, they have been permitted to deteriorate into 
comparative ineffectiveness. 

The English elections of 1906 and 1907 
\^u&n^it/^^ overwhelmingly against municipali- 
zation. 



456 The Promotion of Convenience. [§ 401 / 

After this book was in proof, there appeared 
.Mr. Robert P. Porter's 44 Dangers of Municipal Owner- 
ship". It deals mainly with Great Britain, and rein- 
forces with much interesting and instructive detail, the 
argument of Professor Meyer. It also makes a very 
important and, so far as I know, new contribution to 

t 01. Russia and the discussion, in a demonstration that 
ociallsm. Russia, the most backward of the Euro- 

pean nations (perhaps excepting Turkey), is the most 
forward in socialism — that the corrupt bureaucracy 
which is chaining Russia in her backward and tragic 
position, is simply made up of the politicians who are 
controlling, socialist fashion, a large part of the indus- 
tries which, in progressive countries, are left to private 
initiative and competition. 

Against this consideration it may be urged that the 
bureaucracy of Russia is based on hereditary privilege, 
and that a bureaucracy based on universal suffrage 
would not be open to the same objections. If universal 
suffrage has not provided equally bad bureaucracies in 
New York, Philadelphia and Chicago, the difference is 
not great enough to upset the argument. 

I should be glad, if space and other circumstances 
justified, to give the reader many citations from Mr. Por- 
ter's work, but they are not absolutely essential to the 
discussion as already laid down, tho an examination 
of the work itself will amply repay the trouble. At 
the rate facts and arguments regarding many of the 
civic relations have been accumulating in recent years, 
nothing but the daily newspapers can keep up with 
them. Books, however, can give fundamental prin- 
ciples and general tendencies more effectively than the 
more ephemeral publications can. 

402. Australasian The experience Of Australasia * is inter- 
experience, esting and instructive. But Dr. Clark 
says it is less instructive than the European. Yet a 
summary of his statement of it may be yielded in 

* These points on Australasia arc mainly condensed from 
Clark, op. cit. 



§ 404] Latest Aspects of Government Operation. 457 



deference to those who think otherwise, as well as to 
its distinctive interest. 

403. Conditions Those colonies inherited from the mother 
unpricedentediy country a highly developed civil service, 
avora e. an( j themselves evolved even a more cen- 
tralized government. Most of the large share of local 
services performed in America by unsalaried officers, is 
performed in Australasia by permanent civil employees 
who hold their places for life. Thus the country was 
in a position for handling government industries, far 
in advance of ours. 

Australasia was the first great civilized country to 
come into being after the railway and the telegraph 
were in use, and it was therefore very natural for her 
governments to build and operate them, as it was natural 
for earlier governments to build common roads. More- 
over, Australasian governments could borrow money in 
London to do this, cheaper than native individual 
capitalists could. The people did not want London 
syndicates exploiting the country, and all this pointed 
to government doing the work instead of private enter- 
prise. This, however, has not prevented much similar 
work by private enterprise since, in face of the fact that 
the government was first in the field — a suggestive 
symptom of the oft-proved superiority of private man- 
agement to government management, at least so far as 
concerns economy , energy and efficiency. Another symp- 
tom is the fact that nearly all the government railroads 

404. Government are 11111 at ^ ie ex P ense °f ^ e taxpayers, at 

railroads run at a the rate of $66,000,000 for the decade 
,oss ' 1894-1904, not to speak of $40,000,000 

taxes that could have been expected from private lines 
in the same period, if paid at American rates. Says 
Dr. Clark: 

"Private railways thrive in the shadow of preponderating 
government systems. Private and public street railways are 
operated harmoniously in the same cities, or in neighboring 
towns and states, and neither drives the other from the field." 

The government rate in Australasia is three cents a 



458 The Promotion of Convenience. [§ 405 

mile for long rides on railroads, as against 

amon T cl^ii2e% he$t our two cents '» an< ^ there is an annual 
p!op!Sfcj v ze expense for government in New Zealand 
of $38 per capita as against $21 in the 
United Kingdom, $18 in France, $10 in Germany and 
$8 in the United States.* 

406. Vice of And yet this is an excellent place to 

statistics. warn the young student with an illustra- 

tion against the characteristic vice of statistics — they 
generally can state but one fact, while the real situation 
consists of many; and to get at the whole truth, many 
statistics should be combined. This of course is done 
in many of the tables. But so far as I have examined, 
I find no serious effort to make a comparison of the total 
cost of government per capita in various countries. 
The figures I have given are only for the national 
governments, and it is plain that the expenses of the 
national government in the United States do not cover 
many matters that are attended to by other civilized 
national governments, but here are attended to by the 
state governments. Probably there is no great nation 
which leaves so large a part of its activities ta its 
subdivisions, unless it be Germany; and, suggestively 
enough, in the cases cited, Germany, despite her gnNat 
military and (recently) naval expenses, appears next 
economy to the United States. New Zealand, on tha 
other hand, being a colony, is exempt from many of\ 
the usual items of national expenditure, tho probably 
subjected to much that is with us borne by the separate 
states. And yet — and as again illustrating the com- 
plexities apt to be hidden under very simple figures — in 
the United States, the expenses of the state govern- 
ments are so small as compared with those of the national 
and local governments, that they do not affect the matter 
much, after all; while in England, and probably in 
Australasia, the general government bears many ex- 
penses — for instance, some connected with education 

* Reports of speeches of Sir Joseph Ward, Premier of New 
Zealand, in the United States in June and July, 1906. 



§ 408] Latest Aspects of Government Operation. 459 



and the constabulary — that here are borne by the local 
governments. 

The reader will then probably conclude, as the writer 
long since did, that the value of statistics is qualitative 
rather than quantitative — that tho they generally show 
tendencies, they seldom give their actual force. 
407. Telephones ^he P UDnc telegraphs and telephones 
and coal-mines at do not pay interest on the investment in 
a l * 1, Australia, though they have recently done 

so in New Zealand. But the rates are lower than in 
the United States. New Zealand operates two govern- 
ment coal-mines which are new experiments and ran 
$10,000 behind on their interest account in 1905. 

Yet notwithstanding the deficits on Australasian 
public enterprises, the confidence of capital in the re- 
sources of the country is such that, as already said, the 
government can borrow at good rates, which have, on 
the whole, been growing more favorable. 
408 Government Australasian government being the 

success in mone*- great landlord, and being able to borrow 
lending. money better than anybody else there, 

promoted settlement not only by building railroads and 
telegraphs through its lands, but also by loaning to 
settlers money for improvements. This experiment, 
tho of no direct financial interest to us, is worth recount- 
ing as a remarkable object lesson against the vulgar 
impression that trading results only in good to one party, 
and that of course the sharper party. The governments 
lend the settlers money for land and improvements, and 
so benefit them; the governments borrow the same 
money from the British bankers, pay them remunera- 
tive interest, and so benefit them; and the govern- 
ments make a margin of about one per cent, between 
what they pay and what they receive, and so benefit 
themselves. 



"The prevailing rate of interest on real-estate mortgages 
fell from seven to five per cent. — or the level of the government 
rate — during the first ten years the law [for government loans 
to landholders] was in operation. Bankers in New Zealand 



460 



The Promotion of Convenience. 



[§408 



interviewed as to the effect of the law, spoke of its results with- 
out disfavor, seeming to think that it might have stimulated 
business. . . . Private banks and savings institutions are able 
to place their funds securely and profitably in spite of govern- 
ment competition." 

"There has been no exigent demand for state 
ance r " insurance . or tnc system would surely have 

extended beyond New Zealand during the thirty- 
six years it has been in existence in that colony. South 
Australia, with a state commission and export department, has 
also one of the largest cooperative farmers' commission com- 
panies in the Commonwealth, which does a business for its 
members five times as great as that done by the government, 
tho in more varied lines." 



Dr. Clark sums up his views : 

"A conclusion reached by an outsider as to 
neMtivel M the utilit y of government ownership, from the 
° ' experience of Australasia, must be so largely 

qualified as to be almost negative. Public railways, telegraphs 
and land banks have succeeded. [The author must mean 
succeeded in pleasing the majority — especially the non-tax- 
payers: for he himself shows how they have not succeeded 
financially.] . . . An outside observer, unless a faddist on gov- 
ernment ownership, would probably come away from Austral- 
asia with a feeling that, after all, this issue is less important — 
as affecting the social and economic welfare of the people — 
than those who theoretically discuss the subject suppose. 
Government ownership docs not bankrupt the state, deaden 
private enterprise, and kill prosperity; neither does it bring 
a nation into an industrial millennium with a bump. 

' ' The average wage-earner ... in exchanging 
demoralized? private for state employment sacrifices no indi- 
vidual freedom. Independent or self-employing 
workers, on the other hand, usually have property interests that 
make them averse to social changes ; and they have something 
that they probably value still more, . . . that is, their power of 
self-direction. ... A man who has been his own boss . . . 
resents the restraint of official supervision. This sentiment 
is widely diffused among the more prosperous working people 
of Australasia. The experience of democracy, in Australasia 
as well as America, goes to show that the personal interest 
of a public captain of industry would lie in conciliating his 
employees, at the expense if necessary of the whole body of 
citizens. . . . As a natural consequence of this, the investigating 
commissions of Parliament have found that public are more 
expensive than corresponding private undertakings, and that 
men do not work as well for the state as for private employers. 



§ 413 a l Latest Aspects of Government Operation. 461 



Nothing illustrates the last fact more significantly than that the 
usual term among Australasians for an easy-going pace of 
working is *the government stroke'." 

c #. || • Among Mr. Reeves's arguments* for en- 
4iz. somefaiiacies. larging the f unct i ns of the state is: "Mis- 
takes may be made, but we can restrain the state. 
Trusts and combines we might not be able to control/ ' 
It would be interesting to poll the citizens of New York, 
Philadelphia and Chicago, and a good many other places, 
on this question. But as to the state, it is the incon- 
testable fact that it is possible in a single day (tho 
only after a hard-fought campaign) to 4 4 turn the rascals 
out". But it is equally incontestable that they have 
always got back again. One is tempted to believe 
that in a given state of human nature, one method, in 
the long run, does about as well as another, and that 
the only advance that can be made permanent is in 
human nature itself. But this skepticism regarding 
methods should be guarded against. Because of some 
defect of detail, the best methods often fail when first 
tried; but something is learned at each attempt, even 
be it no more than what to avoid in future. 

Another equally striking and equally questionable 
remark of Mr. Reeves is that " newspapers criticise the 
public service in a way which they will not or dare not 
criticise private enterprise. State management, there- 
fore, carries with it the great guarantee of publicity.' ' 
With this statement, compare the notorious difficulty of 
getting correct accounts of state enterprises, from Aus- 
tralia or anywhere else. 

413. The latest Notwithstanding that the American ex- 
American experi- perience of government operation is com- 
ence ' paratively trifling, it has already been 

abandoned in several cases in addition to those already 

413 (a) Omaha £P ven - ^ n I 9°5» tne c * tv °f Omaha for the 
a ' m ' first time in sixteen years, elected a Demo- 
cratic administration, because the Democrats promised 

* Op. cit. 



462 



The Promotion of Convenience. [§ 413 a 



municipal operation. A special letter to the New York 
Times thus related the experience: k j 

"The Democrats promised municipal ownership of just 
about all the public utilities, even down to advocating that the 
city own the railroad switch-tracks in the wholesale districts 
and rent these tracks to the different railroads. . . . Omaha 
went wild over the idea. . . . After the election the cost . . . 
began to be counted. The Board of Engineers . . . made a re- 
port that just doubled the price the city was willing to pay for 
the water system, and the water company went into court to 
compel the city to pay. . . . When the taxpayers saw that 
they would be compelled to pay more than $6,000,000 for prop- 
erty which they had expected to get for $3,000,000 there was 
a howl from them. 

"Immediately afterward it was found that the fund on which 
the municipal asphalt plant was expected to keep running all 
the summer was exhausted in July. . . . Then the city market - 
house scandal opened up afresh. This was the first effort of 
Omaha to go into municipal-ownership business. . . . 

"A big house was erected on one of the principal streets at a 
cost of $12,000, altho almost any contractor in the city would 
duplicate the building for $5,000. Then the Council made 
stringent laws forcing the commission men to move into the 
market-house. Two of them did so. . . . The others ignored 
the order. After a month or so the two . . . moved out and 
the doors were closed. 

"And so, between the market-house scandal, the asphalt 
works, the three-million-dollar overcharge in the waterworks 
plant, and the failure of the City Council to take any steps to 
rescue the city from the muddle it has gotten into, taxpayers 
are afraid of indulging any further in municipal-ownership ideas." 

So far as American experience goes, the last important 
testimony was gathered and discussed at the meeting 
of the Political Science Association in Baltimore, Decem- 
ber 26 to 29, 1895.* The discussion was of "The Case 
for Municipal Ownership", but Operation was certainly 
meant, as there had not then developed any serious 
opinion against Ownership. The proponent of "the 
case for" announced its triumphant success in America, 
413 (b), a weak but cited in evidence only the electric-light- 
ahowing. j n g pi aT1 ts of Detroit, Chicago and Alle- 

gheny; sundry markets and docks which require vir- 

* These reports, made as listener, I have checked from the 
"Proceedings". 



§ 413 d] Latest Aspects of Government Operation. 463 



tuaily no ' operation", and where, in the nature of the 
case, private operation is virtually unknown; the Cin- 
cinnati Southern Railway, which is not municipally 
operated at all, but leased to a private corporation; 
and the water-plants of some half-dozen cities where 
water runs down hill under municipal supervision (some 
of them, cities like New York and Boston, being cases 
where water has been acting that way, undisturbed by 
these new questions of municipal operation, for over 
fifty years). The failures and wastes were not embraced 
in his schedule. 

Then he proceeded to show, very cor- 
4\3(o. ne strong rectly, that the strong men of the cities 

man will control J ' , to 

under any system, now control them through the public- 
service corporations; and to prove con- 
clusively that if there were no public-service corpora- 
tions, the strong men would not control the cities 
through them. He omitted, however, to prove that 
if the strong men did not control in that way, they 
would not control at all. So far as experience has been 
accumulated, they always have controlled ; and so far as 
the future can be judged from the past, they always 
will control, until there shall be so much advance in 
the strength of weaker men that all men will be strong, 
and democracy will be a fact as well as a name. At 
present, however, the weaker men are not paying much 
attention to developing their strength, but are absorbed 
in schemes for massing what strength they have, to get 
more conveniences at the expense of those who are 
already stronger. 

The same speaker at the Baltimore 
fnViliuhe°geT ,y meeting brought up as an argument for 
municipal operation, the demonstrated 
and established argument against it — that "monopoly 
is always indolent". Apparently he failed to realize 
that there can be no other monopoly as nearly im- 
pregnable as a government monopoly. He claimed that 
the destruction of private operation would be the de- 
struction of privilege. Apparently he had never heard 
of Tammany Hall or the privileges enjoyed by Tweed 



464 



The Promotion of Convenience. 



[§413^ 



and Croker and their fellows, even with municipal 
operation of all the franchises far beyond their 
grasp. 

He made a number of other cla