The Trade Union movement and the various growths of Industrial Partnership, valuable as they are from many points of view, furnish no remedies against the chief forms of economic monopoly and economic waste; they can only change the personality and expand the number of monopolists, and alter the character, not the quantity, of economic waste. Society has an ever-deepening and more vital interest in the economical management of the machinery of transport, and this interest is no whit more secure if the practical control of railways and docks were in the hands of the Dockers' Union or the Amalgamated Society of Railway Servants, or of a combined board of directors and trade union officials, than it is under present circumstances. On the contrary, an effective organisation of capital and labour in an industry would be more likely to pursue a policy opposed to the interests of the wider public than now, because such a policy would be far more likely to succeed.
§ 6. When it is said that modern industry is becoming essentially more collective in character and therefore demands collective control, what is meant is that under modern industrial development the interest of the industrial society as a whole, and of the consuming public in each piece of so-called private enterprise, is greater than it was ever before, and requires some guarantee that this interest shall not be ignored. Where the industry is of such a kind, and in such a stage of development, that keen competition without undue waste survives, this public interest can commonly be secured by the enactment of restrictive legislation. Where such partial control is insufficient to secure the social interest against monopoly or waste, State management, upon a national, municipal, or such other scale as is economically advisable, must take the place of a private enterprise which is dangerous to society. This necessity becomes obvious as soon as the notion of a business as being purely "private" or "self-regarding" in its character is seen to be directly negatived by an understanding of the complex social nature of every commercial act. So soon as the idea of a social industrial organism is grasped, the question of State interference in, or State assumption of, an industry becomes a question of social expediency—that is, of the just interpretation of the facts relating to the particular case. In large measure this social control is to be regarded, not as a necessary protection against the monopolic power of individuals, but as necessary for the security of individual property within the limits prescribed by social welfare. Modern machine-evolution, as is seen, permits and encourages the wanton invasion and destruction of forms of capital by the competition of new savings employed in an anti-social way. It likewise tends to the frequent destruction of the value of that labour power which is the sole property of the mass of workers. "The property which every man has in his own labour, as it is the original foundation, so it is the most sacred and inviolable."[289]
There are certain wastes of economic power involved in all competition; there are certain dangers of monopoly attaching to all private conduct of industry. Collective control deals with these wastes and dangers, adjusting itself to their extent and character.
§ 7. To the question how far and how rapidly may this extension of collective control proceed, no more definite answer is possible than this, that as a larger and larger amount of industry passes into the condition of the most highly evolved machine-industries of to-day, and develops along with the corresponding economies, corresponding dangers and wastes, larger portions will pass under restrictive legislation or State management.
The evolution in the structure of capitalist enterprise, while it breeds and aggravates the diseases of trade depression, sweating, etc., likewise prepares the way and facilitates the work of social control. It is easier to inspect a few large factories than many small ones, easier to arbitrate where capital and labour stands organised in large masses, easier to municipalise big joint-stock businesses in gas, water, or conveyance. Every legislative interference, in the way of inspection or minor control, quickens the evolution of an industry, and hastens the time when it acquires the position of monopoly which demands a fuller measure of control, and finally passes into the ranks of public industry.
Thus it would follow that, unless proceeding pari passu with this evolution there was a springing up or an expansion of other industries not so amenable to large machine production and therefore not prone to the dangers and wastes which appertain to it, collectivism would absorb an ever-increasing proportion of industrial effort.
§ 8. At present it appears that there are two great classes of productive work which have not fallen under machine-industry and capitalism in its typical form. There is that work which machinery is technically competent to perform, but which it cannot economically undertake so long as large quantities of very cheap labour are available. This class comprises the bulk of what are commonly called the "sweating" trades, the cheap low-skilled domestic workshop labour. The other class consists of artistic and intellectual work which cannot be successfully undertaken by machinery. The first of these classes is universally admitted to comprise cases of arrested development. The irregular working of the more highly-evolved industries, the successive supplantation of branches of skilled labour by machinery, the blind migration of labour from distant parts, keeps the large industrial centres supplied with a quantity of unskilled and untrained labour, which can be bought so cheaply that in the lowest branches of many trades it does not pay the entrepreneur to incur the initial cost of setting up expensive machinery and the risk of working it. The social and moral progress of industrial nations requires, as a first condition of orderly progress, that these cases of arrested growth shall be absorbed into the general mass of machine-industry. These problems of "the sweating system," the unemployed, the pauper class, the natural products of the working of a system of competition where the competitors start from widely different lines of opportunity, can never be solved by the private play of enlightened self-interest, unless that enlightenment take a far more altruistic form than is consistent with the continuance of competitive industry. This is the fundamental paralogism of that school of reformers who find the cure of industrial maladies in the humanisation of the private employer. A whole class of employers sufficiently humane and far-sighted to consistently desire the welfare of their employees (and no fewer than the whole class would suffice, for otherwise the less benevolent will undersell and take the business from the more benevolent) would be so highly civilised that they would no longer be willing to compete with one another so as to injure one another's business: they would out of pure goodwill organise into a "monopoly," and working this monopoly for the exclusive interest of themselves and their employees, rack-rent the consuming public; or if their benevolence extended to all their customers they would socialise their business, conducting it for the greatest good of all society. Such a form of socialised industry, dependent upon the moral character of perishable individuals, would possess all the weaknesses charged against State socialism without any of the educative advantages or the security and stability of that system. The "captain of industry" remedy is a sentimental and not a scientific one. Once regard "sweating" as a case of arrested development and the true line of progress will be seen to lie in the absorption of these backward industries into the main current of industrial movement, leaving them to pass through the necessary phases of machine-production and to be subjected to an increasing pressure of social control until they are ripe for society to undertake. Then there will remain outside of capitalist machine-industry only that class of work which is artistic and therefore individualistic in character.
§ 9. We now stand face to face with the main objection so often raised against all endeavours to remedy industrial and social diseases by the expansion of public control. Competition and the zest of individual gain, it is urged, furnish the most effective incentive to enterprise and discovery. Assuming that society were structurally competent to administer industry officially, the establishment of industrial order would be the death-blow to industrial progress. The strife, danger, and waste of industrial competition are necessary conditions to industrial vitality.
How much force do these objections contain in the light of the information provided by our study of industrial evolution? It should be recognised at the outset that the economic individualist is not a conservative, defending an established order and pointing out the dangers attending proposed innovations. Our analysis of the structure of modern industry shows the progressive socialisation of certain classes of industry as a step in the order of events, equally natural and necessary with the earlier steps by which machine-industry superseded handicraft and crystallised in ever larger masses with changing relations to one another. The indictment against social control over industry is an indictment against a natural order of events, on the ground that nature has taken a wrong road of advancement. It is only possible to regard the legislative action by which public control over industry is established as "unnatural" or "artificial" by excluding from "Nature" those social forces which find expression in Acts of Parliament, an eminently unscientific mode of reasoning.
But though this growing exercise of social control cannot be regarded as "fighting against the constitution of things,"[290] it may be considered by those who hold we have no guarantee of the future development of the human race, as one of the lines of action in which the advancing enfeeblement of man may express itself: the abandonment of individual strife in commerce may be regarded as a mark of diminishing vitality, which seeks immunity from effort and an equable condition of material comfort, in preference to the risks and excitement of a more eventful and arduous career. Order will be purchased at the price of progress: the abandonment of individual enterprise in industry is part of the decadence of humanity. This is the interpretation which Dr. Pearson, in his National Life and Character, places upon the socialistic tendencies of the age: the suppression of competitive industry in order to cure poverty, physical misery, and social injustice, will produce a society which is "sensuous, genial, fibreless." The validity of such a judgment rests upon two assumptions: first, that social control of industry necessarily crushes the spirit of individual enterprise and checks industrial progress; second, that extension of State control over capitalist industry necessarily implies a diminished scope of individual control in the production of wealth.