are suggested by the fact that the employees of the coöperative societies have formed themselves into a trade union for the betterment of their condition of employment.1 While consumers' coöperation and coöperative marketingboth designed to abolish the profits of the middleman — are important and praiseworthy forms of economic association, they have little effect upon the wage-earning classes, and offer no remedy for the antagonism between capital and labor in manufacturing industries. The variety of coöperation which really copes with these questions and seriously attempts to regenerate the wage system is producers' coöperation. The essential features of this form of coöperation are (1) that each group of workers is to be associated by their own free choice; (2) that these associates shall work under a leader elected and removable by themselves; and (3) that the collective remuneration of the labor performed by the group shall be divided among all its members (including the leader) in such a manner as shall be arranged, upon principles recognized as equitable by the society themselves.2 Successful coöperative experiments fulfilling the above conditions are seldom met with. But they are not unknown. Here and there a man of transcendent commercial genius and extraordinary sympathy has succeeded in democratizing his business, turning it over to his employees, and so impressing his spirit and his methods upon his successors that the business continues to prosper under the régime of self-government. An illustration is found in the Godin Familistère of Guise, France, which, beginning with a scheme of profit sharing in 1877, has finally resulted in the establishment not only of a coöperative manufacturing enterprise, but in the successful conduct of what practically amounts to a coöperative community. But such cases are rare. Most experiments in producers' cooperation have failed, and we fear they must continue to fail. They apparently cannot meet the competition of businesses 1 For an account of some of the advantages of certain types of cooperative marketing, see Chap. xxix (Agricultural Problems). 2 D. F. Schloss, Methods of Industrial Remuneration, p. 228. organized in the ordinary way, directed by one man or set of men with all the efficiency, mobility, and adaptability that come from singleness of aim and undivided management. Industrial democracy, as achieved in the coöperative form of industrial organization, is too unwieldy, too slow, too mechanical. Multitudinous management means relatively uncertain, indecisive, and inefficient management. A modified form of producers' coöperation is not unknown among the manufacturing industries of this country. An approximate idea of the extent of this form of industrial organization may be gathered from recent census statistics. In 1909 the statistics of manufactures relating to character of ownership show a separate class of "miscellaneous business organizations" which consists almost entirely of coöperative manufacturing concerns. There were in this group 4120 establishments (constituting 1.5 per cent of all manufacturing establishments) employing 12,934 persons (0.2 per cent of all wage earners), producing goods with an annual value of $104,766,104 (0.5 per cent of the aggregate product). Most of these associations are cooperative creameries; and it is interesting to note that in this great industry which was coöperative in origin — the corporate form of organization increases in importance, measured by value of products, more rapidly than the coöperative form. These figures furnish a maximum estimate of producers' coöperation in the United States, and a large majority of the concerns credited to coöperation in this enumeration would fail to satisfy a strict definition of producers' coöperation. The wage contract, whatever its defects, has one striking virtue - certainty. The wage earner knows what to expect and gets what he expects. He is safeguarded in large measure against business risk, and although he may pay too high a price for his safety, the safety itself is a highly desirable thing. It is one of the weaknesses of producers' coöperation that the workman is encouraged to invest his savings in the hazardous competitive experiments in which he is engaged. He becomes part owner of the enterprise, to be sure, but by doing so he assumes the risk of failure, a risk which, other things being equal, it is desirable to eliminate. It is very likely that the ultimate method by which industrial democracy is achieved will retain that feature of the present wage system by which most of the workers are largely safeguarded against business losses. The Future of the Union. If industrial democracy is to be achieved, all present indications are that it will be through the labor organization. Since the introduction of collective bargaining, its range has constantly widened. Beginning with questions of wages, hours of labor, and apprenticeship, it has gradually spread, until at the present time some unions bargain about the sanitary conditions of the work, the introduction of safety devices, the employment of women, the use of machinery, and the status of the men with whom their members work. A few powerful unions insist that the foremen under whom their members work shall belong to the union, demand a voice in the discharge of employees, and try to force the employer, when taking on new men, to select them in order from lists of unemployed journeymen prepared by the union. These demands, of course, may be harmful: in industry as in government, certain functions must be entrusted almost wholly to the executive head. The fact that power may be abused, however, is really beside the point. The point lies in the possibility of extending the range of collective bargaining until the employees shall have a voice and it is to be hoped a prevailing voice in determining the conditions of employment. Through collective bargaining the control of the employees over the business may be indefinitely expanded. Once having secured control, the majority may learn, as they are slowly learning in political life, to leave certain particularly difficult questions to their industrial captains. In the past, labor has had to seek capital and serve it. In the future, capital may have to seek and serve labor. -- These words are written in no spirit of advocacy, and with no intention of palliating the obvious shortcomings of the trade union. But the fact remains - whether we like it or not - that economic theory and economic history unite in the conclusion that the union has come to stay as long as the system of capitalistic production. The union must be improved, it cannot be extirpated; and the most urgent task of the present is to convince employers and unionists that there will be no real peace until employers acknowledge the inevitableness of the union, and unions acknowledge - sympathetically and in practical ways the social serviceableness of the employer. Trade unions have been guilty of many sins-violence, monopoly, political corruption. But their gravest danger at the present time is a false philosophy, in accordance with which many unionists have come to believe that the best way to help the union is to oppose the employer. This is not true of the more wisely conducted unions. The railway brotherhoods frequently unite with the railway managers in securing legislation favorable to the railway industry; and the history of the National Civic Federation, for example, proves that a number of the opposing leaders are keenly aware that capital and labor have interests in common as well as in opposition. In some way, however, united labor as a whole must learn how to drive just as favorable a bargain as possible with the employers in the first instance, and then, the bargain having been made, to bend every effort in loyal coöperation with the employer to make the business the greatest possible success. This is not mere platitude. In the long run, the institution that stands in the way of productive efficiency will perish. The trade union must bring into industry something besides conflict, or it will disappear. The union that so conducts itself as to make the non-union man or the non-union shop more efficient than the union man or the union shop, simply puts a premium upon the suppression of unionism. QUESTIONS 1. Is the industrial or the trade union the more logical form of organization? Can the two be reconciled? Mention as many kinds of jurisdiction disputes as you can. 2. Does the trade union rest upon a sound economic basis? Is it likely to endure? Is it in any large degree responsible for the conflict between labor and capital? 3. Are all attempts to achieve a monopoly illegitimate? Is there more justification for labor monopolies than industrial monopolies? 4. Is the policy of the closed shop ever justifiable? Intimidation of non-union men? restriction of apprenticeship? regulation of output? 5. The strike has been defined as a "concerted cessation of work"; is this definition correct? Have men a "right" to strike whenever they wish? Are employers justified in "locking out" their men at pleasure? 6. Is the "blacklist" more justifiable than the boycott? Can either the "blacklist" or the boycott be conducted in a lawful manner? 7. Distinguish between trade arbitration, voluntary arbitration, compulsory investigation, and Compulsory arbitration. What are the defects of arbitration as a method of settling labor disputes? 8. What is the difference between the Victorian (wage-board) and the New Zealand (compulsory arbitration) systems? 9. Why do labor leaders oppose compulsory arbitration? Is their opposition a sufficient reason for rejecting it? Why is the plea for compulsory arbitration particularly strong in the case of monopolistic industries? 10. How does "gain sharing" differ from "profit sharing"?- Is profit sharing necessarily paternalistic? If so, is this a defect? 11. Does consumers' coöperation materially advance industrial democracy? Is producers' coöperation likely to grow and expand? REFERENCES ADAMS, T. S., and SUMNER, H. L. Labor Problems. COMMONS, J. R. (Editor). Documentary History of American Industrial Society (10 vols.). ELY, R. T. The Labor Movement in America. GILMAN, N. P. Methods of Industrial Peace; A Dividend to Labor. HOLLANDER, J. H. and BARNETT, G. E. (editors). Studies in American Trade Unionism. Industrial Commission. Report, Vols. xvii, xix. LAIDLER, H. W. Boycotts and the Labor Struggle. LE ROSSIGNOL, J. E., and STEWART, W. D. State Socialism in New Zealand, Chaps. xiii, xiv. LEVASSEUR, E. The American Workman. MAROT, HELEN. American Labor Unions. MITCHELL, JOHN. Organized Labor. PIGOU, A. C. Principles and Methods of Industrial Peace. ROWNTREE, B. S. Poverty: A Study of Town Life. SCHLOSS, D. F. Methods of Industrial Remuneration. WEBB, CATHERINE. Industrial Coöperation. WEBB, SIDNEY and BEATRICE. History of Trade Unionism; Industrial Democracy. |