other elements of production into a systematic process. Under the progressive economic order of today the role of this participant is the one whose status is most in dispute. Yet it is he more than any one else who is ever pushing out the frontiers of industry and trade. He is both entrepreneur and pioneer. Hence it has seemed to many that the responsible adventurer might rightly be entitled to pioneering profits. Indeed, the economics of pioneering risks in modern business lends strong support to the view that, without this industrial and commercial leadership in the command and the management of capital, material progress would be much slower. Are not he and his capitalist associates, regarded as a group of pioneer risk-takers, really entitled to the net returns of the national income, after the other claims, including taxes, are fairly and fully met?

There is much to be said in the affirmative. Modern capital is always seeking through the laboratory the means for creating new sources of economic goods. In a progressive society, based on freedom and private property, the great game of the pursuit of business for profit needs the pioneering type of talent. The speculative riskbearers are the participants who put millions of surplus capital at the disposal of specialists. They project into the future by means of longterm contracts vast plans of production. They organize raw materials, labor power and otherwise idle capital, under a system of continuous and profitable enterprise. They are the ones who in a large measure personify modernity with its highly organized armies of peaceful industry, advancing by the all-conquering guidance of science, and all marshalled under a risk-assuming service responsive to the spirit of democracy.

2. Bargaining Power of Big Business

There are two widely different views on the question whether combination makes for a more equitable outcome to labor and to the consumer. Something akin to Marxian hopelessness is evident in A. J. Hobson's analysis. He holds that "the era of competition in the business world is giving place more and more to an era of combination. While capital and labor are both combining, the combination of capital is advancing faster and is more effective. Though primarily designed more for the control of output and of selling prices than for bargaining with labor, it has been inevitable that trusts, and other combines or federations of businesses, should pay increasing attention to the art of buying labor economically. This new organization of capital thus tends to militate against the rise of wages in two ways: by restraining competition in the markets so as to raise the price of commodities which wages buy, and by restraining money wages from rising so as to compensate the workers adequately for the rise of prices.

Though there is here no closely thought-out and conscious policy, the operation of organized modern capitalism is towards a modified 'iron law of wages, keeping real remuneration of labor down to a level of minimum efficiency demanded for the sorts of skilled or unskilled labor which the several industries require." *

In line with this is the view of John A. Fitch of The Survey, New York, claiming that the attitude of the Steel Trust against resort to collective bargaining of any kind, in dealing with its 260,000 employees, tends to outweigh any advantage gained by pensions, profit-sharing, or bettered labor conditions.

It is part of the faith in the existing economic order to hold that, in spite of criticism, the natural development of society is steadily toward equality in essentials. "There are inherent and unseen forces that work everlastingly to this end," is the way George E. Roberts sees it. The leaders and inside organizers may seem to apportion to themselves more than is really due, and less than is equitable to their employees in wages. Yet, "the remainder goes into the investment fund and creates a new demand for wages and a new supply of products, thus strengthening the employee's position both as a wage-earner and as a consumer." †

But over against this must be set the labor view of the national dividend. "They affirm," as Dr. Peter Roberts expresses it, "that the men at the head of industrial combinations take the fat of the fry, while a bare subsistence is given to the vast majority of laborers." It is difficult to dislodge this conviction, so long as combinations fail to realize that the test of their service is in promotion of sound conditions of public welfare.

3. Adjustment to Public Welfare

What is still by all means the largest of the trust's problems is its harmonious adjustment to the social, political, and moral convictions of the community. Here is a new instrument of great power in the business world with direct relations to the state and nation and to the homes and associations of the people. A form of private enterprise has become a mighty institution. To what extent does its management undertake to prevent discordant relations and to promote harmonious attitudes with its environment? Speaking at the Chicago Conference on Trusts, Prof. Henry C. Adams concluded his address by saying:

"This is indeed a great question. It moves in many directions and embraces many considerations. It is at bottom a question of social theories and social ideas. Its vastness will be appreciated when it is observed that its judicious

treatment will result in securing for the people the advantages of the industrial development of the past century, while to ignore it or to fail in its solution would result in prostituting the wealth created by an hundred years of phenomenal development to the service of a class.” *

That trust management at the start failed to grasp this opportunity will generally be admitted by most students of the subject. On the other hand, while it failed to adjust itself sufficiently to legal and moral standards in its political and social environment, the more public spirited have to their credit a splendid record of welfare work-instances shown in the United States Steel Corporation, The International Harvester Company, the National Cash Register Company, and many others. In dealings with their own people these combinations set higher sanitary standards than their predecessors, or their independent competitors. They have grasped the business wisdom of better conditions of living, better social opportunities and privileges, and larger leisure as a means of enhancing industrial efficiency. But, in their external relations, officers, directors, and stockholders have yet to appreciate their responsibilities as citizens in adjusting these splendid agencies of wealth production and distribution so as to accord with the political order and economic freedom under which they have attained their position of power.