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of Australasian wages' legislation and its consequential results, with a clearness that admits of no dispute. I was present some years ago in a Wellington Court for fixing wages, the operatives having made a demand for an increase. The argument was that prices had risen and amongst the proofs put in, was an increased wages list for another trade determined previously by the Court. The employers did not resist, but being engaged in an industry which had to meet the competition of imports, they complained that as they would have to raise prices to enable them to pay increased wages' bills, their trade would suffer. After some more or less informal conversation about increasing the schedule of the protective duties, an award was agreed to increasing wages. Obviously this is going round in a circle, and is no way to secure a good distribution compatible with communal well-being. The Australian trade unions have come to this conclusion, hence the outburst of labour disputes in Australia during recent years. Within the system of Capitalism, after the toll of rent has been paid, the control of the distribution of the product must remain with the capitalist. That does not mean that distribution cannot be improved, and that the condition of the workers must remain stationary. It would be so if the capitalist control was absolute, but it is not so strong as that. Labour has some power to take. Legislation is its chief policeman. Not only wages' boards, but such things as the improvement of the sanitation and amenities of towns, higher standards of housing by-laws, cheapness by competition, gains which labour can grasp and keep especially when they are followed by improved methods of production, all contribute to progress, and to them is due
what advance we see in the lot of the workman during the nineteenth century. But this can never solve the distribution problem, and alter very materially the relative portions of the shares given to capital and labour* per head of the classes, and the gulf between the two must remain wide. The dramatic evidences of that gulf which are provided from time to time by the vulgar and Byzantine extravagance of the rich must continue to rouse resentment and enmity. The shares were estimated in 1868 by Mr. Dudley Baxter as being—wages £325,000,000, national income £814,000,000, and these proportions are not much worse than what Sir Leo Chiozza Money estimates exists to-day. Two thousand five hundred persons own more than half our land. In 1914–15, out of £800,000,000 left in property at death, 4,400 persons owned £212,000,000. The same is true of every industrial State. Consequently, if labour has improved its position relatively to rent and interest, it has not done so because it has won a larger share in its products as wages, but because by political action, it has been able to get an adjusted share through social legislation, securing free education and such advantages paid for by rates and taxes in the form of a greater share of the common wealth. Labour's political gains have been greater than its industrial ones. The division in economic interest which I have been discussing gives rise to a fundamentally false view of distribution from which Socialism dissociates itself. A better distribution cannot be effected by changes in the amount of currency secured either as wages or profits. If we have more to enjoy we must either distribute better the values we have produced or produce more of them. Herein lies the weakness of a purely Trade Union policy. It deals with wages primarily, and is baffled when it discovers after its victories that higher wages do not mean more enjoyment of products. Trade Unions are absolutely essential for defence; they are weak for progress. Industrial action can keep what has been got, but can secure few gains. When labour deals with distribution it must work upon a policy which secures control of the whole distributive machine and which results in more hearty production. Thus Trade Unionism must ultimately concern itself with economic reconstruction and find an ally in Socialism.
* As I write this some leaflets have been delivered to me by post in which I find in display type that whereas before the war not more than £25,000,000 were spent per annum in building private dwellinghouses of all kinds, £75,000,000 were spent upon motor-cars for private use; and that, at a time when public and private economy is being urged to save the nation from ruin, some million pounds’ worth of orders for cars were given at a recently held motor show.
CAPITALIST SYSTEM OF DISTRIBUTION
Before dealing with constructive Socialist proposals I shall explain the capitalist machinery for the distribution of products, as the one cannot be separated from the other. The system worked to-day involves the producer, the wholesaler, and the retailer. The producer sometimes puts his own goods on the market as a wholesaler or retailer— like some of the -multiple shops; the wholesaler mobilizes in bulk groups of production, e.g., ironmongery, drapery, clothing; the retailer brings them in smaller quantities to within reach of purchasers. The system is wasteful in the extreme.
Producers and wholesalers employ great armies of travellers and agents, both at home and abroad, covering the same field and fighting each other on behalf of their respective firms. At the end of the battle, in most cases, all that happens is that the trade of one firm has been taken by another. The agent, so necessary for individual firms in competition, does not add one farthing to national wealth, but is a charge upon it. Advertisement is also essential to this method, for one of the most important secrets of business success is that the crowd believes what it sees often enough, and forgets what is not always thrust under its nose. When the mass has no knowledge to make it independent, its credulity must be enlisted to make it obedient. Advertisement statements are, as a rule, lies for bait, and few either aid production or guide the public on the ways of beneficial consumption. But, when one considers what modern advertising means, one can see what a colossal waste it is. It is now a highly technical and specialized art brought by competition to a fine state of perfection. There is the producing firm's advertising department or its agency staffed with smart business men, typographical experts, and experts in the production of the advertising poster. There is the expenditure on newspapers, the waste in paper and the labour of compositors employed, and, as a kind of by-product which has arisen since advertisers began to trouble about the political opinions of papers, the shadow of advertisers' influence lying over editorial policy. There is the much greater waste of paper and compositors' and artists' time in preparing the millions of advertising sheets and leaflets issued in the course of a year by firms that wish to take trade from other firms or to maintain their position against rivals, by firms that have ordinary things to sell but wish to gain a reputation for them
of extra special quality, by firms that have nothing of any value to sell but are out to exploit the ignorance of people after the manner of the market-place Cheap Jack. Then there are the hoardings where wealth is wasted on the eye-sickening “Trade Advertisement,” and, what is still worse, the vandal use of charming corners on a road, or of a rock face set in the midst of mountains or standing out by itself, for the erection of some sign that destroys one's sense of peace and pleasure and gives one the same shock as, I presume, the announcement of “This way to the King's Head” in Paradise would give the dweller there. All has to be paid for from the national product and reduces enormously the number of workmen really producing national wealth. Both as regards advertising and the use of agents, Capitalism is beginning to admit its wasteful extravagance, and the newer combinations hope to secure for profits the enormous savings that can be made under these headings. The division of the country and the world into market areas assigned to separate members of the combination, changes the commercial agent into a productive cog in the wheel of distribution, because he is not then only the servant of a firm in rivalry with others, but a useful link between producer and consumer. He becomes necessary for general consumption and not for a particular firm's turnover. The establishment of foreign and home central selling agencies equipped with samples and information acting for all the firms in the combination, is also an improvement in efficiency and economy, and a transformation of the agent from an unproductive cost to a productive one. The Committee of the Iron and Steel Trades recommended a short time ago that “a national