been translated into loans and the wealthy possess most of them, and through them, they have a greater lien than ever on national production. The £400,000,000 which will have to be paid for years to State creditors may penalize industrial capital, but it adds tremendously to the exploiting powers of financial capital. These debts may mean diminution of our trade in the world's markets. If so, there will be a recurring struggle between capital and labour for their respective shares in the lessened proceeds.

With £400,000,000 going every year from production to pay for wasted wealth, the cost of production must be comparatively high, attempts will be made to economize upon wages and standards of living forced down below pre-war levels. The capitalist interests will not think of accepting the Socialist proposals for reducing debt by a levy on wealth, and so follow the practice of all sound business enterprises which write off dead capital and do not keep it corrupting the living. The £400,000,000 burden will be sacred, because, however dubious a thing it may be, it does belong to the family of property, and, to treat it otherwise than by the family rules and privileges, might weaken the authority of the rules. The black sheep is shielded by family considerations, and the war debts and the burdens they impose are therefore accepted in the general interests of property. The black sheep, however, can trade upon family indulgence till he brings his kin into disgrace and perhaps penury.

The cheapening of production will be attempted from wages in the first instance, and already the campaign has begun. In no very great proportion of cases have wages been raised by a higher

percentage than prices,* and I know of no case where wages were forced up before capitalist interests had raised prices. That does not mean that labour has no more reserve from its present wages than it had from its pre-war wages. There has been substitution in consumption which has meant lower qualities, and though, as in the case of clothing, this is higher costs in the long run, it may be admitted that when the cost of living is increased threefold and wages are also increased threefold, the margins go up threefold as well.† In 1914, however, labour was preparing to make demands for a considerable advance in standards, and as the result of the increases in war wages, the most fortunate classes today are little better off than they were making up their minds to be in 1914-and are rapidly becoming worse. The inevitable outburst of unemployment will settle this contest for reduced wages. Capital has always a great pull against labour in times of trade depression. Capital's losses may then be considerable, but it is in a position to provide for them in the total costs of trade averaged over a period of two states-busy trade and slack trade. Labour for practical purposes is not in that position. It breaks by its weakest link. Unemployment, when living costs are high, speedily brings a large section

* I came across in a report of the American Trade Commission, a striking statement regarding the distribution of wages and profits in the shoe industry as affected by the war. In 1914, profit absorbed half the price and labour one-sixth; in 1917 profit absorbed threefifths and labour one-ninth.

† The real advantage to labour was not increased wages, but increased family income. This, however, drops whilst wages rates remain stationary, because fewer members of the family are employed for wages and broken working time increases. Though wages have gone up since the armistice, family incomes must have decreased substantially.

of labour to destitution, and in spite of trade unions that section soon begins to think of work on any terms that are at all tolerable. Broken labour is brought back into the labour field on low terms, and standards fall all round; broken capital goes out of the capitalist field altogether, and leaves the survivors stronger. Thus, the menace of dull trade is one of unmitigated evil to labour, whereas it comes with not a few recompenses to capital. That is why capital not infrequently plays deliberately to force labour to strike.

Therefore, the influences that have been strengthened by the war, so far as they affect distribution of wealth, have been those which are on the side of capital. Its combination for production, and therefore its pull in distribution, is greater; its lien on national resources through State indebtedness is greater; the social and personal inconvenience of high standards of price makes for social enmity, and gives the thousand and one mouthpieces of capitalist interests an opportunity to raise prejudice against labour, to pit engineers against miners, and the opinion of consumers against them all. Behind that smoke screen capital remains uncriticized, operating in its own interests all the time, using the quarrel for its own profit. Labour in antagonism to capital cannot permanently occupy ground of tactical advantage on the purely industrial field. In its struggle for a just distribution it cannot wait. It must sooner or later-sooner rather than later-abandon its position of advantage and fight under conditions which make its defeat almost inevitable. The jolts and jars in trade which give it grievances, provide at the same time the conditions under which it is advantageous for capital to close its works. There

fore the frequently urged criticism directed against strikes, that they have been foolishly begun on a falling market only amounts to a statement which is not critical but descriptive, that labour's grievances become the cause of war when markets are falling. "Direct action" can never secure for labour economic advantages which the mechanism of the capitalist system puts under the control of capital. In nine cases out of ten I direct action" will throw the machine out of gear only when it was going out of gear in any event.

66

WAGES

In its struggle for better distribution, labour is aided by its combinations and by legislation, both of which curb the absolute economic power of capital to reduce labour's share to bare subsistence, including cost of reproduction and substitution by death, age, illness and other causes of waste. That even in spite of these aids, labour in a great number of instances fails to secure a bare subsistence is proved by the existence of charity and the Poor Law, Old Age Pensions, unemployment doles and schemes, Acts for the feeding and clothing of school childrenall of which mean that the share of labour is not enough to keep it in a state of self-sufficiency from its cradle to its grave.* What happens is that wealth after its first distribution has to be redistributed by taxation and rating in order to secure to many the right to live (poor law), and to enjoy life (education, housing subsidies, health insurance). When to mere

* I know that amongst these cases there is a considerable proportion of moral failures, but the figures of distribution which I have given above show that the failure of the system is the major and controlling fact, and that personal faults only select the most pitiable victims.

quantitative life we add qualitative life, the failure is still more deplorable. Overcrowding, the lack of leisure and contact with nature, of homes that nourish the human qualities, of culture, of that freedom and joy which are of the essence of human life, show how little have our production and distribution yet done to make life a good thing to great masses. Nor do men only suffer from want, for, owing to the necessities of the capitalist system, the overburdening cares of material interests hang over life as smoke clouds lie over some of our most beautiful spots of nature, and prevent the ownership of wealth being the same thing as its enjoyment. Indeed, he who owns most often enjoys least. Thus, those who have wealth can use it only for outward decoration and ostentation, for vulgarity and corruption, and those elect ones who, as just stewards, use their wealth well and by it clothe their souls in appropriate garments, are lost in the mass of repulsive tawdriness, of burdensome anxieties, and of the worship of the mean and the profitless.* The same failure to use opportunities well is seen in labour, but it must not be forgotten in passing judgment upon that, that in these matters labour is imitative. There can be no improvement until those who habitually own property show that improvement.

Labour has for the time being considerably strengthened its combination, as capital has done,

* Two books have recently been published which reveal intimately and from the inside the utter worthlessness and rottenness of great parts of our wealthy classes. Mrs. Asquith's Autobiography does this pathetically. Here our guide through the barren wilderness seems to know that her companionship has been with jackals, and her soul has not been satisfied. Colonel Repington's diary of "The First World War " makes the same revelations without a glimmer of consciousness of what he is doing.