Already before the War the tendency to crush out individuality was becoming stronger and stronger, the private firms of manufacturers were being squeezed out by highly organised combines, or tempted by high prices offered to hand over their businesses to them. In banking, similarly, the absorption and amalgamation of smaller banks has been going on with startling rapidity. The personal relationship between the customer and the banker, who would grant loans and overdrafts because he knew the character and position of the borrower in each case, will no longer exist. The business was safe enough when the manager of a country bank probably knew whether a customer's butcher's bills were becoming excessive. Now everything must be referred to London for decision according to some fixed general rule. The convenience and the accommodation of the man with a small account count for very little. A more serious question is the effect which these amalgamations may have on the relations between bankers and those who are engaged in manufacturing business.
The old personal relationship between the mill-owner and his employees, when his garden adjoined the mill yard, when they spoke of him by his Christian name, and he knew their family affairs and was ready to help in time of difficulty and distress and to take a lead in any local effort or support any local charity, has been rapidly disappearing. There still are, however, many employers to whom the happiness and welfare of their workpeople is a matter of deepest concern. They have a human interest in them, and take a pride in improving the conditions of their life. They have
other aims than simply securing as big a dividend as possible for the eager shareholders of a huge combine. It is, no doubt, usually large employers of labour who are thus able and willing to make provision for the welfare of the people in their employ. Some have established libraries and reading-rooms, and have provided classes for giving instruction likely to be useful to the boys and young men engaged in their works. Conditions of labour would be greatly improved if the example of the best firms in such matters were generally followed.
The more complete organisation of trades under powerful councils may tend to a virtual monopoly being obtained by a limited number of large and influential firms, and the result may be prejudicial to the consumer by limiting competition. That is not certainly the object, but it may be an incidental effect of the organisation which is needed for full development of the system of councils. In some cases State support and control acting in conjunction with private firms of great influence is to be introduced to unify an industry under one management. Support and control may possibly be necessary in some cases, but the extension of such methods should be jealously watched. In the manufacture of dyes, for example, it seems that the Government and a very powerful manufacturing firm or combination are arranging to act together. Those outside this combination will have no chance of competing. In this particular case the scheme may be useful, but careful provision is necessary to protect customers for the commodities produced. It may become a very serious thing for manufacturers of piece goods when struggling to maintain their position in the world markets, and the slightest addition to cost of production may close a market to them, if they find that they cannot purchase the dyes they require in the cheapest market, or those who dye goods for them must increase their charges, because one organisation can fix prices, and import from abroad is prohibited in order to protect a special home industry.
Possibly it may be necessary for a time to give such protection to certain industries, involving a preliminary expenditure of a large capital; but the fact that the dye industry had gone from England to Germany was, in the opinion of many, due not so much to free and open competition as to the circumstances that (1) the German producers paid more attention to systematic chemical research bearing on the industry, and (2) that our absurd patent law operated to throttle English production. The founder of the successful firm of Levinstein, Limited, Mr. Ivan Levinstein, seeing by his own experience how our patent laws prevented the development of the dye industry in England, devoted years of work to obtain an alteration of these laws, but with only partial success. The Government, after very long delays, attempted to deal with the matter, but it is not yet satisfactorily settled. A Bill on the subject is now before Parliament. A list can be given of more than a dozen cases—there may have been many others—in which the Badische-Anilin Fabrik was plaintiff against firms in this country. The result was to aid the rapid development of the huge works near Mannheim now used to manufacture poisonous gases, while the works in this country were crippled. Strangely enough, it was an English chemist (Sir W. Perkin) who made the discoveries which led to the development of this industry; but it is generally possible where competition is keen to take out subsidiary patents for small improvements which really enable the subsequent patentee to command the market. Sometimes the root invention for some reason cannot be made the subject of a valid patent, or the patent for it expires before its full commercial value has been realised, and the minor improvements give the holder of patents for them a virtual monopoly.
All along the line, too, the big firm is favoured at the expense of the smaller. The position of the small tradesman is often a very hard one. The shopkeeper in a village or small town near the metropolis pays heavy rates for the upkeep of roads which are torn to
pieces by the heavy motors of the great distributing firms delivering goods to those who would otherwise be his customers, perhaps with petrol specially exempted from taxation. The firm which by widespread advertisements can induce people to buy an article with some familiar name attached, reaps a gigantic fortune, while the man who makes the same article and cannot spend money on advertisement gains a mere pittance. The advertisements which disfigure the country are not taxed, as in other countries, and the issue of advertising circulars has been subsidised by the Post Office, which delivered them at a rate lower than that charged for delivery of the letters, or even the postcards, of the poorest, though the trouble involved is the same. The patent laws, again, have been exploited to protect the large manufacturer, who fences some form of production by taking out a string of patents often where there is no meritorious invention at all. The rubbishy specifications are flourished in the face of a poor competitor, and form a basis for threats which a man who is not wealthy dare not resist, knowing the heavy cost of fighting any patent action whether successful or not. "To him that hath shall be given" ought not to be a maxim to guide legislators or any department of Government.
To return from this digression. One great advantage of the councils would be that those who represent the workmen upon them will probably be men who are actually engaged in manual work in the trades concerned, or have been so engaged, and who will look at each question practically. The agitator who lives on grievances and disputes, the politician "on the make," or the well-meaning and half-informed enthusiast from outside, is not likely to find a place on councils whose object it is to see how interests which investors, managers, and workmen have in common can best be promoted, and how the share of each in the work and its profits can be more fairly assigned and distributed instead of attention being concentrated on matters in which their interests seem to be in conflict.
Another difficulty of more direct importance with regard to the proposed councils is already arising. The relative powers and position of the shop stewards chosen by the men in each works and of the unions representing industry as a whole in any district have to be settled. There are also overlapping unions competing for influence and support, and sometimes doing so by making excessive demands. The events of the next few months may lead either to an accentuation or to a partial solution of these questions which are perhaps the most serious at present affecting industrial peace. It is better not to anticipate. Prophecy might be falsified too soon and too palpably, and the position, which changes from week to week, is too critical for anyone to discuss unless he has full and exact knowledge of the facts and clear understanding of the way in which undercurrents are setting.