"CAPITALISM AND SOCIAL DISCONTENT."

Pukekohe & Waiuku Times, Volume 5, Issue 199, 11 August 1916, Page 4 (Supplement)

"CAPITALISM AND SOCIAL DISCONTENT."

Capital is being destroyed on an enormous sca'e in the great war, and one result of this must sooner or later be a full recognition of the fundamental relationship beween it and the welfare of the workers. Having th'.s fact in mind, Mr. J. Laurence Laughlin, an eminent American economist, has recently contributed to the "North American Review" a suggestive article under the above title. He devotes himself n particular to exploding the Labourite fallacies that the empty-ffanded yoijg workman is, and must remain, outsß the sacred precincts of industrial ■ cess, because he is denied the hope m possession of capital, "and that I wage-earners should regard trM unions as the means (practically ■ solo means) through which to work ■ their economic salvation." It is soH times asserted that possessors of snS incomes have no margin from whß capital can be saved. To tins -H McLaughlin replies that the mere fl of the'steady and marvellous gro\W of capital as the race has developed M of meagre, primitive resources is H final answer to any such claim. Capfl as jt exists to-day has not only chanfl the relation of man to his environmej and to his ability ti satisfy increasH wants, but it enables him to createM system of industry involving extensM co-operatjon and division of labfl which would be wholly impossible wiH out it. This is tho outcome of I " cap'-talism" that socialists and labH agitators are never tired of It has been undoubtedly a highly bd iicient agent in the world. Then B is it decrjed. Because, so it is the labouring classes are, in it, "disfranchised." What truth is in that doctrine? In the minds thosj Who accept it there is an idea that capitalism is for the separation of mankind flj employers and employees, yet why flj that some men are employers and mH are employed. Apart from inheritaHß and gifts of privilege, "the enormia ni.fss of modern capital has come : H existence by a personal process of sflj ing, by abstention from personal cHJ sumption in order to get it for prodHJ r-ve uses." in its origin there is B psychical as well as a physical elemeHJ "Trie creation and legitimate possH sion of capital consequently requiii certain personal qualities—wiilingtiMJ and imagination enough to weiglßJ future gam over against a present I diligence, self-control, patience, pH sistewe, foresight and prudence. ThflJ who have thes9 homely virtues oecoH tho possessors of capital, and hence B ployers of others. The separation nflj the two great- classes of the employM and tlie employed is thus due to diirflj ences in human qualities; diiferencH however, of a kind that can be remoAl oy training, environment, and the I velopment of character and tion. On o of the fundamental weflj nesses ot socialism is that it votaries the possession of capH through the action oi BJ State, without any personal sacr'-ficeHJ their part, and Oy removing the SB stimulus to character and virtue I upon them by t!io exisbipg systenHß societj- —more or less faulty though BJ systci., may bo in oi..tr ways." ,S(BJ discontent in itself is not harmful H tho contrary, it is a thing which aHJ did not exist wo should wisli to urvflj as a means of establishing tile vHJ motive for progress in those who •- 'BJ times havo no ambition, and think tBJ aro disfranchised.'' The real q'H tion is the end to which the disconßß should bo directed. The worbßß classes aro taught by cheir own leacflj to look first and last to unions, I unions are characterised by the I>H principle of monopoly ot labour, iflj whnlo economic purpose is to tr..BJ raisn wages at a given time and pVJ by limiting tho supply of labour 9J tainab'e by employers. For physiolflP cal reasons alone tho supply of labour through birttis .s certain to ceine forward quite irrespective of policy. They cannot in a*ny natural way control the supply. If the statement made in Job . Stuart MiU'a day that the incomes of tiie working classes do not increase pari passu with the increase :n production because of the increase ii the number of labourers, it is plain that the future progrcsn of the working population depends upon something more than fraction!.! advances in wages. "The upshot of the whole matter,'' declares Mr. Laughlin, "is clear in logic and experience. Permanently to ra-.-e wages of any group of labourers vo must raise their productive power or their utility oh 9 demander. To do that is to place them bynatural monopoly in tho class of the skilled, where heir numbers are more or less Lin tod relatively to the unskilled. In otho:words, supply s directly affected to the permanent advantage oi those included. Thus the artificial monopoly of the union, which mistakenly aims at restriction of supply without an avanee in quality, is remrveil. In thrift and increased skill lies tho hope of tho work ng classes. Savings, however small, do, with modern fac'liti;-s 1> r investment, raise tneni into the class of capitalists while increasing the total capacity of the nation for industrial enterprise. Skill increases the deman 1 fe- labour, because it increases the outfun oi labour, and the increased demand means permanent advance -i wages and a wider margin for saving.-'