Why then did not a cry arise at that time against the guarantee of dividends as an inadmissible intervention of the State? Why was it not then discovered that by this guarantee the social incentive of the rich managers of those stock companies was threatened? Why was this guarantee of the State not decried as Socialism and Communism?
But forsooth, this intervention of the State was in the interests of the rich and well-to-do classes of society, and in that case it is entirely admissible and always has been! It is only when there is any question of intervention in favor of the poverty-stricken classes, in favor of the infinite majority, then it is "pure Socialism and Communism."
Give this answer, therefore, to those who wish to raise a howl about the inadmissibility of State intervention and the social independence endangered by it, and the Socialism and Communism concealed in a demand which does not give the slightest occasion for such a howl; and add that since we have, after all, been living in a state of Socialism and Communism, as those guarantees of dividends on railroads and all the other above-mentioned examples show, we will continue right on in that state.
A further consideration is that, however great was the advance in civilization accomplished by the railroads, it drops to the vanishing point in contrast with that mighty advance which would be accomplished by the association of the working class. Of what avail are all the hoarded wealth and all the fruits of civilization if they exist for only a few, and if the majority of the human race always remains the Tantalus who reaches in vain for these fruits! Worse than Tantalus—for he at least had not produced the fruits for which his parched lips were condemned to pant in vain! This, the mightiest advance of culture which history could know, would justify the helpful intervention of the State if anything would. The State furthermore can furnish this possibility in the easiest manner through the banking institutions (a matter into which I cannot go at length here) without assuming any greater responsibility than it did by the guarantee of dividends to the railroads.
Finally, Gentlemen, what, after all, is the State? (Quotes statistics which may be summed up as follows: In 1851 the percentage of the population of Prussia having more than 1,000 thalers ($750) annual income for each family of five persons was less than 1/2 of 1 per cent.; of those having less than 100 thalers ($75) for such a family was 72-1/4 per cent; those having 100 to 200 thalers, 16-1/4 per cent.; and 200 to 400, 7-1/4 per cent.) The two lowest classes form, therefore, 89 per cent, of the population; and if you take also the 7% per cent, of the third class, who must still be considered in oppressive poverty, you have 96-1/4 per cent, of the population in a most needy, unfortunate situation. The State, therefore, belongs to you, Gentlemen, to the suffering classes—not to us, the upper classes; for it is you who compose it. "What is the State?" I ask; and you see now from a few figures, more vividly than from heavy volumes, the answer. The great association of the poorer classes—yourselves—that is the State.
And why should not your great association have a helpful and fruitful effect upon your smaller associated groups? This question you may also put to those who talk to you about the inadmissibility of State intervention and about Socialism and Communism in the demand for it.
If, finally, you desire a special instance of the impossibility of producing an improvement in the condition of the working class in any other way than by free association through this helpful intervention of the State, you may look to England, that country which is most frequently called in evidence to prove the possibility for an association of individual workingmen established purely and exclusively through their unassisted powers, to improve the condition of the whole class—England, which in fact must appear best suited, for various reasons based on its particular national conditions, to carry out this experiment, without, nevertheless, demonstrating thereby a similar possibility for other countries.
And this special instance comes directly from those English workingmen's associations which up to this time have usually been referred to as triumphant proof of such an assertion. I speak of the Pioneers of Rochdale. This coöperative society, organized in 1844, established in 1858 a spinning and weaving establishment with a capital of £5,500 sterling. According to the statutes of this association, the workmen employed in the factory, whether they were stockholders in the association or not, drew a profit, in addition to the usual wages, equal to that distributed as dividends to the stockholders—the arrangement having been made that the annual dividends should be reckoned and distributed both on wages and on capital stock. Now the number of stockholders of this factory is one thousand six hundred, while only five hundred workmen are employed there. Accordingly, there exists a large number of stockholders who are not also workmen in the factory; on the other hand, all the workmen are not at the same time stockholders. In consequence of this an agitation broke out in 1861 among the workingmen stockholders who did not work in the factory, and also among those who were both employees and stockholders, against the workmen who were not stockholders receiving a share of the profits. On the part of the workingmen stockholders the principle was laid down simply and frankly that, according to the usual custom in the whole industrial world, the claims of labor were satisfied with the wages and that wages were determined by supply and demand (we have seen above by what law). "This fact," relates Professor Huber in his report of this affair, "was considered valid without further question, as the natural condition, needing no further justification, in opposition to a quite exceptional, arbitrary innovation, even though it were according to the statutes." Bravely, but only with very dimly understood emotional reasons, this proposition for the changing of the statutes was opposed by the original founders and managers of the association. In fact, a majority of five-eighths of the workingmen stockholders voted for the change of the statutes, taking exactly the same position as the capitalist employers, and the change was defeated for the time being only because, according to the statutes, a majority of three-fourths of the votes was required. "But nobody," states Professor Huber, "is unaware that the matter is not thereby settled; it is more likely that still further serious internal dissensions are to be looked for by this association, the outcome of which, perhaps even next year, may well be a successful repetition of this attempt—all the more so since the opposition is determined to make its influence felt in the election of the officials of the association, an election at which the majority elects, and through which the controlling offices of the management may soon be in their hands."
Huber reports further in this matter that most of the associations producing on a factory scale have fallen in at the outset with the general custom, evidently without any further consideration or any consciousness of a principle. Only a few have adopted the coöperative principle in favor of labor, and Huber must further admit, although very unwillingly and with a heavy heart, for he is a partisan of coöperation depending upon individual workingmen alone: "There is no doubt that this question will very soon come to discussion and decision in all the producing associations where the opposition of capital and labor exists, and that the competition of the industrial macrocosm (i.e., the world's industry as a whole) is reproduced in the coöperative microcosm (the individual world represented by the workingmen's associations)."
You see, Gentlemen, if you reflect about these facts that great questions can be solved only in a large way, never in a small way. As long as the universal wage is determined by the above-considered law, the small associations will not be able to escape the prevailing influence of it; and what does the working class as a whole gain, or the workingman as such, whether he works for workingmen employers or for capitalist employers? Nothing! You have only scattered the employers to whose profit the result of your labor falls. But labor and the working class are not set free. What does it gain by this! It gains only depravation, only corruption, which now takes hold of it and sets workingman as an exploiting employer against workingman. The employers have changed in person; but labor, the only source of production, remains, as before, dependent upon the so-called wage—that is, the maintenance of existence. Under the influence of this law the perversion of conceptions is so great that, in our instance, even those workingmen stockholders not employed in the factory, instead of recognizing that they owe their dividends to the labor of the workmen who are employed, and accordingly that it is they who draw the profit from the labor of the latter, will, in defiance of this, not allow the latter even a share in the product of their own work, not even a share of what labor has a just claim to. Workingmen with workingmen's means and employers' hearts—that is the repulsive caricature into which those workingmen have been changed.