If Mr. Shaw or his readers are still in doubt as to the extent to which his criticism of myself is wide of the mark—if he still thinks that he is fighting any mistake but his own, when he attacks me as though I confused interest with the direct earnings of Ability, let me add one passage more out of the same chapter:—
“Large profits must not be confounded with high interest. Large profits are a mixture of three things, as was pointed out by Mill, though he did not name two of them happily. He said that profits consisted of wages of superintendence, compensation for risk, and interest on Capital. If, instead of wages of superintendence we say the product of Ability, and instead of compensation for risk we say the reward of sagacity, which is itself a form of Ability, we shall have an accurate statement of the case.”
Again, two pages earlier Mr. Shaw will find this:—
“Interest is capable, under certain circumstances, of being reduced to a minimum without production being in any degree checked; and every pound which the man who employs Capital is thus relieved from paying to the man who owns it constitutes, other things being equal, a fund which may be appropriated by Labour.”
These quotations will be enough to show how the bulk of Mr. Shaw’s criticisms, which he thinks are directed against myself, are criticisms of an absurd error and confusion of thought, which I have myself done my utmost to expose, in order that I might put the real facts of the case more clearly.
Let me now briefly restate what I have actually said about these facts. Let me restate the points which Mr. Shaw hardly ventures even to glance at. I have said that Capital and Ability, as actually engaged in production, are united like mind and brain. There is, however, as I observed also, this difference. So far as this life is concerned, at all events, brain and mind are inseparable. The organ and the function cannot be divided. But in the case of Ability and Capital they can be. The mind of one man has often to borrow from another man the matter through which alone it is able to operate in production. Thus though Ability and Capital, when viewed from the standpoint of Labour, are one thing, when viewed from the standpoint of their different processes they are two; and Capital is seen to produce a part of the product, as distinguished from the Ability whose tool and organ it is. Mr. Shaw says that the capital of the country at the present time produces five hundred million pounds annually, and, for argument’s sake, I accept this figure. Thus far, then, Mr. Shaw and I agree. But what I have urged Mr. Shaw to consider, and what he does not venture even to think of, is the following question:—How did the capital of this country come into existence?
Even the soil of this country, as we know it now, is an artificial product. It did not exist in its present state two hundred years ago. Still it was there. But of the capital of the country, as it exists to-day, by far the larger part did not exist at all. Let us merely go back two generations—to the times of our own grandfathers; and we shall find that of the ten thousand million pounds at which our present capital is estimated, eight thousand million pounds have been produced during the last eighty years. That is to say, four-fifths of our capital was non-existent at a time when the grandfathers of many of us were already grown men. How, then, was this capital produced? The ordinary Socialist will say that it was produced by Labour—that it is, as (I think) Lassalle called it, “fossil Labour.” Mr. Shaw, however, judging by what we have seen of his opinions, will agree with me that though a small part of it may be fossil Labour, by far the larger part is fossil Ability. It is, in fact, savings from the growing annual wealth which has been produced during the period in question by the activity of able men. But these able men did not produce it by accident. They produced it under the stimulus of some very strong motive. What was this motive? Mr. Shaw’s Socialistic friends and predecessors have been spouting and shouting an answer to this question for the past sixty years. They have been telling us that the main motive of the employing class was “greed.” Unlike most of their statements, this is entirely true. Nor, although the sound of it is offensive, is there anything offensive in its meaning. It means that in saving capital and in producing the surplus out of which they were able to save it, the motive of the producers was the desire to live on the interest of it when it was saved; and that if it had not been for the desire, the hope, the expectation of getting this interest, the capital most certainly would never have been produced at all, or, at all events, only a very minute fraction of it.
I asked in one of my articles in this Review whether Mr. Shaw thought that a man who received ten thousand a year as the product of his exceptional ability would value this sum as much if he were forbidden by the State to invest a penny of it—if the State, in fact, were an organised conspiracy to prevent his investing it so as to make an independent provision for his family, or for himself at any moment when he might wish to stop working—as he values it now when the State is organised so as to make his investments secure? And the sole indication in the whole of Mr. Shaw’s paper that he has ever realised the existence of the question here indicated is to be found in a casual sentence, in which he says that to think that the complete confiscation of all the capital created by the two past generations, and the avowed intention on the part of the State to confiscate all the capital that is now being created by the present—to think, in other words, that the annihilation of the strongest and fiercest hope that has ever nerved exceptional men to make exceptional industrial exertion, would in the smallest degree damp the energies of any able man—“is an extremely unhistoric apprehension,” and one as to which he “doubts whether the public will take the alarm.” And having said this, he endeavours to justify himself by an appeal to history. He asks if the men who built the Pyramids did not work just as hard “though they knew that Pharaoh was at the head of an organised conspiracy to take away the Pyramids from them as soon as they were made?”
This remarkable historical reference is the sole answer Mr. Shaw attempts to make to the real point raised by me. If it is necessary seriously to answer it, let me refer Mr. Shaw to Labour and the Popular Welfare, pp. 124, 125, where his childish piece of reasoning—actually illustrated there by the example of Ancient Egypt—is anticipated and disposed of. As I there pointed out, these great buildings of the ancient world were the products not of Ability as it exists in the modern world, but of Labour; the difference between the two (so far as this point is concerned) being this:—that the labour an average man can perform is a known quantity, and wherever a dominant race enslaves an inferior one, the taskmasters of the former can coerce the latter into performing a required amount of service. But the existence of exceptional ability cannot be known or even suspected by others till the able individual voluntarily shows and exerts it. He cannot be driven; he must be induced and tempted. And not only is there no means of making him exert his talents, except by allowing these talents to secure for himself an exceptional reward; but in the absence of any such reward to fire his imagination and his passion, he will probably not be conscious of his own Ability himself. Pharaoh could flog the stupidest Israelite into laying so many bricks, but he could not have flogged Moses himself into a Brassey, a Bessemer, or an Edison.
This, however, is a point with which it is impossible to deal in a few sentences or a few pages. The great question of human motive, closely allied as it is with the question of family affection, the pleasures of social intercourse, the excitements and prizes of social rivalry, of love, of ambition, and all the philosophy of taste and manners—this great question of motive can be only touched upon here. But a few more words may be said to show the naïve ignorance of human nature and of the world betrayed by the Fabian champion.