[5] Mr. Denny was led by subsequent experience to a much less favourable view of the efficacy of piecework as an instrument of working-class progress. He wrote me in June, 1886 (ten years after the publication of the pamphlet I have quoted above) an interesting and valuable letter on this subject, which is published in full in Dr. Bruce's biography of him ("Life of William Denny," p. 113). A larger experience of piecework, he said, had convinced him that, excepting in cases where rates can be fixed and made a matter of agreement between the whole body of the men in any works and their employers, piecework prices have not a self-regulating power, and are liable, under the pressure of competition, to be depressed below what he would consider a proper level. And this was chiefly, if not, indeed, exclusively, the case with those lump jobs which were undertaken by little copartneries of workmen, and afforded the occasions for practising co-operation from which he had drawn the hopes I have mentioned above. He came to see that in all kinds of work for which it was difficult to fix regular rates, the beneficial operation of payment by the piece on wages was much more uncertain than he previously supposed, except in the hands of a good master, who was not an absentee. But for ordinary work, I think he still adhered to his favourable opinion of the effect of the piece system in increasing the worker's earnings. He said he had nothing to modify about the figures adduced in his pamphlet, and I understood him to continue to count them representative of the general operation of pieceworking.
[6] More will be found on this subject in the chapter on "State Socialism," under the sub-heading "State Socialism and State Management."
CHAPTER XI. STATE SOCIALISM.
I. State Socialism and English Economics.
State socialism has been described by M. Léon Say as a German philosophy which was natural enough to a people with the political history and habits of the Germans, but which, in his opinion, was ill calculated to cross the French frontier, and was contrary to the very nature of the Anglo-Saxons. Sovereign and trader may be incompatible occupations, as Adam Smith asserts, but in Germany, at least, they have never seemed so. There, Governments have always been accustomed to enter very considerably into trade and manufactures, partly to provide the public revenue, partly to supply deficiencies of private enterprise, and partly, within more recent times, for reasons of a so-called "strategic" order, connected with the defence or consolidation of the new Empire. The German States possess, every one of them, more Crown lands and forests, in proportion to their size, than any other countries in Europe, some of them, indeed, being able to meet half their public expenditure from this source alone; and besides their territorial domain, most of them have an even more extensive industrial domain of State mines, or State breweries, or State banks, or State foundries, or State potteries, or State railways, and their rulers are still projecting fresh conquests in the same direction by means of brandy and tobacco monopolies. But in England things stand far otherwise. She has sold off most of her Crown lands, and is slowly parting with, rather than adding to, the remainder. She abolished State monopolies in the days of the Stuarts, as instruments of political oppression, and she has abandoned State bounties more recently as nurses of commercial incompetency. She owes her whole industrial greatness, her manufactures, her banks, her shipping, her railways, to some extent her very colonial possessions, to the unassisted energy of her private citizens. England has been reared on the principle of freedom, and could never be brought, M. Say might not unreasonably conclude, to espouse the opposite principle of State socialism, unless the national character underwent a radical change. And yet, while he was still writing, he was confounded to see signs, as he thought, of this alien philosophy obtaining, not simply an asylum, but really an ascendancy in this country. It appeared to M. Say to be striking every whit as strong a root in our soil and climate as it had done in its native habitat, and he is disposed to join in the alarm, then recently sounded at Edinburgh by Mr. Goschen, that the soil and climate had changed, that the whole policy, opinion, and feeling of the English people with respect to the intervention of the public authority had undergone a revolution.
Mr. Goschen had, in raising the alarm, shown some perplexity how far to condemn the change and how far to praise it, but he was quite clear upon its reality, and was possessed by a most anxious sense of its magnitude and gravity. "We cannot," said he, "see universal State action enthroned as a principle of government without misgiving." Mr. Herbert Spencer took up the cry with more vehemence, declaring that the age of British freedom was gone, and warning us to prepare for "the coming slavery." M. de Laveleye, who is unquestionably one of the most careful and competent foreign observers of our affairs, followed Mr. Spencer, and although, being himself a State socialist, he welcomed this alleged new era as much as Mr. Spencer deprecated it, he gave substantially the same description of the facts; he said, England, once so jealous for liberty, was now running ahead of all other nations on the career of State socialism. And that seems to have become an established impression both at home and abroad. The French Academy of Moral and Political Sciences has devoted several successive sittings to the subject; the eminent German economist, Professor Nasse, has discussed it—and with much excellent discrimination—in an article on the decline of economic individualism in England; and it is now the current assumption of the journals and of popular conversation in this country, that a profound change has come over the spirit of English politics in the course of the present generation—a change from the old trust in liberty to a new trust in State regulation, and from the French doctrine of laissez-faire to the German doctrine of State socialism.
But this assumption, notwithstanding the currency it has obtained and the distinguished authorities by whom it is supported, is in reality exaggerated and undiscriminating. While marking the growing frequency of Government interventions, it makes no attempt to distinguish between interventions of one kind and interventions of another kind, and it utterly fails to recognise that English opinion—whether exhibited in legislative work or economic writings—was not dominated by the principle of laissez-faire in the past any more than in the present, but that it really has all along obeyed a fairly well-defined positive doctrine of social politics, which gave the State a considerable concurrent rôle in the social and industrial development of the community. The increasing frequency of Government interventions is in itself a simple and unavoidable concomitant of the growth of society. With the rapid transformations of modern industrial life, the increase and concentration of population, and the general spread of enlightenment, we cannot expect to retain the political or legislative inactivity of stationary ages. As Mr. Hearn remarks, "All the volumes of the statutes, from their beginning under Henry III. to the close of the reign of George II., do not equal the quantity of legislative work done in a decade of any subsequent reign." ("Theory of Legal Duties and Rights," p. 21.) The process has been continuous and progressive, and it suffered no interruption in the period which is usually supposed to have been peculiarly sacred to laissez-faire. On the contrary, that period will be found to exceed the period that went before it in legislative activity, exactly as it has in turn been itself exceeded by our own time. On any theory of the State's functions, an increase in the number of laws and regulations was inevitable; it was only part and portion of the natural growth of things; but such an increase affords no evidence, not even a presumption, of any change in the principles by which legislation is governed, or in the purposes or functions for which the power of the State is habitually invoked. A mere growth of work is not a multiplication of functions; to get a result, we must first analyze the work done and discriminate this from that.
Now, in the first place, when compared with other nations, England has been doing singularly little in the direction—the distinctively socialistic direction—of multiplying State industries and enlarging the public property in the means of production. Municipalities, indeed, have widened their industrial domain considerably; it has become common for them to take into their own hands things like the gas and water supply of the community which would in any case be monopolies, and their management, being exposed to an extremely effective local opinion, is generally very advantageous. But while local authorities have done so much, the central Government has held back. Many new industries have come into being during the present reign, but we have nationalized none of them except the telegraphs. We have added to the Post-Office the departments of the Savings Bank and the Parcels Post; we have, for purely military reasons, extended our national dockyards and arms factories since the Crimean war, but without thereby enhancing national confidence in Government management; we have, for diplomatic purposes, bought shares in the Suez Canal; we have undertaken a few small jobs of testing and stamping, such as the branding of herrings; but we are now the only European nation that has no State railway; we have refrained from nationalizing the telephones, though legally entitled to do so; and we very rarely give subventions to private enterprises. This is much less the effect of deliberate political conviction than the natural fruit of the character and circumstances of the people, of their powerful private resources and those habits of commercial association which M. Chevalier speaks of with so much friendly envy, complaining that his own countrymen could never be a great industrial nation because they had no taste for acquiring them. In the English colonies, where capital is more scarce, Government is required to do very much more; most of them have State railways, and some—New Zealand, for instance—State insurance offices for fire and life. These colonial experiments will have great weight with the English public in settling the problem of Government management under a democracy, and if they prove successful, will undoubtedly influence opinion at home to follow their example; but as things are at present, there is no appearance of any great body of English opinion moving in that direction.