Not only is there great waste of labor in the business of producing and distributing the necessaries of life under the competitive system, but the system itself creates a large class of business that absorbs much of the wealth of the community and employs a very large number of its members. For example, under a socialist system there would no longer be any necessity or advantage in insurance, whether against death or fire, or accident, or hail, or defective title, or any other danger. The reason of this is obvious: we insure against pecuniary loss arising out of these accidents because otherwise the whole loss will fall upon ourselves. In a Socialist society some of occasions for loss would not exist at all, and those that did exist would fall upon the entire people and would consequently be inappreciable by any one member of it. For example, a man insures his life so that his children will not be reduced to poverty by his death; but in the Socialist society the widow and the child are provided for, being all of them members and all sharers in its income. Death in such a case would practically not constitute a loss to the state financially, because the number of deaths of the very old and the very young—the unproductive members of the community—is far greater than that of its productive members.
Insurance companies are beginning to understand the importance of keeping their policy holders in good health. The Metropolitan Life Insurance Company is to-day maintaining nurses for this purpose.
Another business that would be eliminated in a Socialist state is the entire business done by brokers; not only Wall Street brokers, but real estate brokers, mining brokers, and brokers of every description, in so far as they are engaged in competition. The abolition of Wall Street would carry with it the abolition of gambling in stocks which is a necessary feature thereof. No law has yet been devised, though the attempt has often been made, that would, so long as the competitive system endures, put a stop to gambling in stocks. A law which would successfully stop gambling in stocks would stop legitimate dealing in stocks also. But the immoral element involved in "puts" and "calls" is only an exaggeration of the immoral element involved in all industrial transactions built upon the principle of private profit. For although business can be conducted in such a way as only to furnish to those engaged in it a fair remuneration, it perpetually furnishes a temptation to contrive so that it shall furnish a large rather than a fair return. In fact, the whole struggle of business consists in endeavoring to secure the largest return of profit for the least expenditure of labor. The man who succeeds in getting the largest return for the least expenditure is the successful business man; and no man does this with more security than the next class to which attention may be called, whose occupation would come to an end in the Socialist state; namely, the bankers.
It would take too long to enter here into an accurate and fair estimate of the service rendered by the banker and the reward he obtains for it. Most writers who favor Socialism undervalue the functions of the banker. They are so impressed by the enormous incomes which bankers make that they do not appreciate the great services they render; and although, in a Socialist state, the banker qua banker would tend to disappear, the man who to-day does the work of a banker would, it is hoped, do the same work for the state. So that although the business of banking would disappear, the best form of government would be that in which individuals who have been discovered to be best fitted for the onerous and difficult duties of finance would be those to whom these duties would be intrusted. Whether the man best fitted to do this difficult work would be intrusted with it under the Socialist plan is a doubt raised as an objection to Socialism which will be considered later.[139]
Another large class of intelligent men, now engaged in carrying on the quarrels which result from the competitive system, would be left without an occupation under the Socialist plan; namely, the lawyers. With them, the hatred and vindictiveness which arise from litigation would in a Socialist society, in great part, disappear also. For lawyers constitute the class whose business it is to conduct these quarrels, and, alas! also to inflame them. When we consider that in New York city alone there are nearly ten thousand practising lawyers, and add to these the clerks, stenographers, bookkeepers, and office-boys employed by each of them, those employed in the courts, the sheriff's office, the county clerk's office, marshals, deputy sheriffs, and others; and take into account that most of these men are engaged in fighting, we cannot but be struck by the enormous advantage to the community of a system which would practically eliminate this class altogether.
I must not be understood to mean, however, that there would be no necessity for courts under the Socialist plan. Even though crimes against property were eliminated by Socialism, there would still be a temptation to commit crime, owing to sexual jealousy and in a certain degree to intemperance and idleness. It cannot be doubted that intemperance and idleness would tend to diminish with the disappearance of the misery that reduces men to the physical condition that engenders these vices, but there would still, doubtless, be some intemperance and some idleness; there would certainly remain unhappy marriages; and as every man is to remain possessed of a small amount of property there would be minute questions of property sometimes involved. But it is hardly conceivable that such questions could involve any system of justice more elaborate than that of the justice of the peace, and possibly a single court of appeal. The diminution of competition would so simplify the law that no question would be likely to arise that the parties to the litigation could not themselves explain. How little litigation would be likely under a Socialist régime may be judged by comparing the litigation to which the administration of the postoffice gives rise with the interminable lawsuits which result from the administration of railroads.[140] Moreover, it is to be hoped that a Socialist community would at last have leisure to study criminology and to understand that the criminal has to be treated as a sick man rather than a wicked one. The whole system of criminal procedure would be changed, and the type now known as the criminal lawyer would disappear. The existing system, under which every prosecuting officer considers his reputation involved in securing the punishment of every accused person brought before the court,[141] necessarily gives rise to a corresponding class of lawyer who regards his reputation as well as his fee involved in opposing the efforts of the prosecuting officer by any means, however unjustifiable. Of course, to the extent to which the competitive system was left standing, there would have to be lawyers to protect competitive interests. But these lawyers would be supported by the competitive system.
If, now, we consider that the large number of men liberated by the substitution of Socialism for our present form of government would not only diminish the labor of those now engaged in production, but that it constitutes the part of our population engaged in fanning the flame of hatred in the minds of men, the advantage to a community of having this perpetual source of trouble removed will be obvious. But we are not concerned so much now with the reduction of hatred under the Socialist plan as with its economy.
Let us next pass to the consideration of the wastefulness involved in the field of production itself:
In 1894 horses in the West became so valueless that they were left unbranded by their owners, lest the branding of them involve the payment of taxes thereupon. Cattle, on the other hand, have of late risen in value; the price of them fell so low some time ago as to involve the ruin of all those largely engaged in raising them; but to-day everyone is rushing back into this business. This state of things furnishes a fair opportunity of judging how imperfectly informed the producer is as to the needs of the community. He is only informed that the community is overstocked with an article by being ruined in the course of producing it. This plan is not only productive of misery to a large number of individuals in every community, but is necessarily an extremely wasteful one. The object of every community ought to be to produce the things it needs, not the things it does not need. The present system, on the contrary, obliges the community to be continually producing the things it does not need as the only means by which it can arrive at a knowledge of what it does need.
For under the existing system, overproduction occasions a surplusage of things in themselves valuable, but the exchange value of which has been diminished by their abundance. And the producer cannot afford to keep this surplusage, because he has fixed charges to pay. He has to sell his crop at a loss because he must have money to pay rent, or interest on mortgage, or salaries, or for his own support during the year. It is this pressure he is under to sell which impoverishes him. And its consequences are far-reaching; for as the price of raw cotton goes down, cotton manufacturers are encouraged to buy, and to increase the output of their factories; and so overproduction of raw material tends to result in overproduction of manufactured goods.