Your pay envelope

by John Richard Meader

This principle, formulated by Marx, is known as “the law of the concentration of capital,” and, if we are to accept this formula, we must be able to prove that capital is being concentrated “in the hands of a smaller and smaller number of capitalists, that large fortunes are created at the expense of smaller fortunes, and that great capitalists are increased by the extinction of small ones” (Tcherkesoff, “Pages of Socialist History,” p. 23).

In a few words, Marx insisted that capitalism was dividing the world into two classes—the owning class and the toiling class—and that the third, or middle class, was rapidly being eliminated, some few of its members being absorbed into the upper-class while the great majority, becoming impoverished, were destined to sink to the lowest of proletarian depths.

But is this what has happened in the half a century or so that has passed since Marx formulated this “law of capitalistic development”? If this “law” is ever to prove itself true, it is time, as Tcherkesoff says, “that it should be exemplified by at least some few economic phenomena”; yet during this period the number of small capitalists not only has not diminished, but has actually increased, while the doctrine of increasing misery, instead of being verified, is contradicted by indisputable statistics which show, as Professor Hatton has asserted (in his Cleveland, Ohio, debate), that “there is an increasing betterment in the condition of the laboring classes.” Certainly none but a most prejudiced Socialist will assert that there is any tangible evidence to indicate that the people are dividing into two hostile camps, especially in view of the fact—so easily demonstrated—that fully 90 per cent. of the capitalists, big and little, have come from the ranks of the workers, while the number of small investors increases with such leaps and bounds as almost to defy the efforts of the statistician to keep pace with them. It was these undeniable facts that compelled Bernstein, though a Socialist, to take issue with Marx. He saw that there was no “increasing misery” of the masses, that the wealth of the world was not being centralized in a few hands; but that, instead, the number of the possessing classes grows absolutely and relatively.

In all my letters, John, I have tried to avoid such things as abstruse theories and dry statistics, but we have at last reached a point where statistics are necessary if we are to get a clear view of the situation. Such statistics are necessary, not only because they show the absurdity of Marx’s predictions, but also for the reason that without this knowledge we should be unable to protect ourselves against the false testimony that Socialists are so ready to introduce as “facts.”

For example, John Spargo (in “Socialism”) quotes Lucien Sanial as authority for the statement that, in 1900, there were 250,251 persons in the United States who possessed $67,000,000,000, “out of a total of $95,000,000,000, given as the national wealth; that is to say, .9 of one per cent of the total number in all occupations owned 70.5 per cent of the total national wealth. The middle class, consisting of 8,429,845 persons, being 29 per cent of the total number in all occupations, owned $24,000,000,000, or 25.3 per cent of the total national wealth. The lowest class, the proletariat, consisting of 20,393,137 persons, being 70.1 per cent of the total number in all occupations, owned but $4,000,000,000, or 4.2 per cent of the total wealth.” In brief: “Of the 29,073,233 persons ten years old and over engaged in occupations, .9 of 1 per cent own 70.5 per cent of total wealth.”

Mr. Spargo asks us to accept these figures as true because Mr. Sanial, “an expert statistician,” says that they are authentic. Don’t let him fool you, John. Mr. Sanial simply “guesses” that his statistics are reliable, and, as he is a “red card” Socialist, he must either tell us just where he got his authority for these figures or be ruled out of court as a prejudiced “guesser.”

And he can’t do it. He can’t do it, simply because there are no census records, or other official figures, upon which to base his statistics on wealth distribution between the classes, no accurate information upon this subject within the reach of any human being. Yet it is upon such “evidence” that Socialists rely to prove that Marx was a true prophet!

But this is an old trick. As Stuart P. West says (The Common Cause, June, 1912), “the Socialist of the agitator-demagogue type has no fine sensibilities about making his statements square with painstaking inquiries into the truth. He makes broad assertions, backing them up with a few statistics which are partly guess-work, partly half-truths, and relies upon the lack of information among his audience to do the rest.”

So much for the unreliable character of Socialist figures in general. Now, let us get down to facts.

The Erfurt platform (1891) repeated Marx’s assertion that among the workers there is a “growing insecurity of existence, misery, oppression, slavery, degradation and exploitation.” If you thought that this might be true, John, what would you expect to find? That the worker was being pressed closer to the wall, would you not? That wages increased slowly, so slowly as scarcely to approximate the bare cost of subsistence; that there was a more rapid extension of the hours of labor, with pauperism a general rather than an exceptional condition. Let us see.