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It has become almost a commonplace nowadays that capitalism, at any rate as the nineteenth century knew it, is showing signs of disintegration, that the motives upon which it relied for its success are not working and cannot be expected to work with their previous regularity. Capitalism stood or fell with its effective supply of “incentives to industry," and while it is perhaps by no means so dead and damned as some of its critics make out, its power to produce the necessary incentives is certainly weakening. It is clear that an increasing number of people do not believe in it, and that though it still supplies motives to work it is less and less producing willing work.

But men are more convinced of the inadequacy of the motives called out by capitalism than they are by the superiority of anything which it has been proposed to put in its place. Most of the alternatives offered make large demands on the unknown possibilities of human nature, and though human nature may not be as unchanging as the defenders of things as they are make out, neither does it show signs of possessing the infinite elasticity which some idealists ascribe to it.

Such being the case, it is clear that experiments in the working of new incentives are to be welcomed, and it may be of interest to set down the results of an elaborate experiment in the organisation of labour, where the economic motives were largely absent, and their place had to be taken by others—the organisation, namely, of labour in the British Army in France during the war. War-time psychology is of course in many ways peculiar and conditions abnormal. War is an activity of which it is difficult to speak in economic terms at all. For as our purpose in war is to end it as quickly as possible, there can be in a sense no question of economy of effort directed to bringing war to a conclusion, and the ordinary categories of economic and wasteful expenditure, though they do apply, can only be applied with difficulty. The end of all effort in war is simple—victory over the enemy; the ends of effort in civil conditions are infinitely complex, dictated as they are by the varying desires and conceptions of the life of individuals. Above all, the element of compulsion and military discipline which is the basis of all military organisation made the problem of the organisation of labour very different from what it is or could be in any society in which such compulsion is absent. For these reasons inferences from what happened in the War to what would happen under civil conditions must be drawn with the greatest caution, and there will always remain differences of opinion as to the value of any lessons which may be drawn from war experience.

Nevertheless, if we keep this precaution in mind, it may be found possible to discern certain principles at work in war experience which have a more universal application.

All war, and especially all modern war, involves an immense deal of activity other than actual fighting-activity whose purpose it is to enable the fighting man, infantry, cavalry, gunners, and aircraft, to fight more efficiently. Supply services exist to feed the fighting man and, in modern war, to feed his weapons. They have to construct and keep running the chain of communications between the home base and the fighting line. In France in the late war the importance of these services became very much greater than ever before owing to the enormous increase in the number and size of artillery which the stationary warfare brought about, and to the devastating effect of artillery fire on communications. These services had an elaborate organisation. The Docks Directorate, for example, was responsible for the unloading of ships in the French ports between Dunkirk and Havre, another service for the operation of the railways in the British zone, another for the construction and maintenance of broad-gauge railways, another for the construction and maintenance of light railways, another for the roads in the zone between the zone where the French and the zone where the Chief Engineers of Corps maintained the roads, another for inland water transport. All these were organised after the first year of the War in the Directorate General of Transportation, known as D.G.T. Besides these there were the older services connected more closely with the army formations—the A.S.C. concerned mainly with food and forage, the Ordnance Corps concerned mainly with ammunition, the Signal Service, the Medical Corps and the Engineers. It is not necessary for the purposes of this article to give a complete list of these administrative services or to describe their relations with one another and with the staff of the army and its formations, with G.H.Q., Armies, Corps, and Divisions. But there are certain characteristics of all these services which for our purpose it is important to notice.

(1) They were all professional services. Each had its own special technique; its personnel had been selected because of their technical efficiency and had been given a technical training. Each had its special esprit de corps, and the efficiency of their work depended largely on the fostering and maintenance of this professional feeling. They were a practical example of Mr. Tawney's idea of the professionalisation of industry. Their professional pride, however, as will be seen, involved also a certain professional narrowness.

(2) While their technical efficiency was the concern of their departments, they all got their executive orders from the Generals in command of army formations. The officer in charge of light railways, for example, in an army area was told by the Army Commander where a light railway was needed and how much ammunition or other supplies had to be carried on it. For the technical details of his work he was ultimately responsible to the Director of Light Railways. The various army commanders said what was to be done; the special services were responsible for how the work was done. This is an important distinction. In economic language the Army Commanders with the assistance of the staff controlled the direction of production, the heads of the special services controlled the methods of production.

So far nothing has been said of the Labour Directorate. Its organisation had not been contemplated before the War. But with the development of trench warfare, and especially with the enormous strain of the Somme offensive, it was found that at a crisis like an offensive far greater demands were made on the personnel of the administrative services than they could possibly supply, while the expedient of using the fighting troops while they were out of the line on all kinds of labour gave the men no rest and interfered dangerously with military training. It was resolved, therefore, to supplement the administrative services described above by labour battalions or companies, distinguished from the men of these services by being comparatively unskilled. These labour companies consisted partly of coloured labour, Kaffirs and Indians, and at the end of the War mainly Chinese, partly of prisoners of war, and partly of men enlisted in Britain who were not physically fit for the fighting line. The Prisoner of War companies could not be employed within thirty kilometres of the line, the Chinese not within sixteen kilometres. In consequence all the work in the forward

areas was carried out by white enlisted labour. These last, like the rest of the army, were conscious of working for a common end, and in that they differed from the prisoners of war, who were made to work for an end which they did not want to bring about, and the Chinese who were working for an end to which they were indifferent. The British labour companies in spite of military discipline and compulsion were free labour, the prisoners of war were slave labour, the Chinese something betwixt and between. So far, therefore, as we are concerned with the psychology of the labourer as contrasted with the psychology of the employer, we shall consider only the British labour companies.

The first labour troops which were organised up to the end of 1916 were allotted more or less permanently to special services, but this practice grew to be impossible. For the essence of the situation was that the demands put upon the special services varied in intensity. In the preparation for an offensive, for example, there was a great demand for railway construction; during an offensive a great demand for the handling of ammunition, and so on. The actual needs of the various services varied from day to day. But each service, intent on its own efficiency, wanted as much labour as it could get and was very reluctant to give it up to another service when it had done with it. Each service, in economic language, wanted to keep its own reserve of labour, with the usual wasteful results. I remember hearing a high official, not in the British army, say, “If no ships came into my ports for thirty days, I would whitewash all my buildings and relay all my track sooner than let another damned department have a single man of mine.” He was no doubt an extreme example, but there was a trace of that spirit in most administrative services. It is the reverse side of professional pride.

The remedy for this state of affairs was to declare that all unskilled labour was to be pooled and to set up an organisation, the Labour Directorate, whose business it was to look after labour companies, to know where all labour was, and to redistribute it in accordance with the directions of the general staff among the previously described services, whom I shall now call the employing or the technical services.

The labour put under the Labour Directorate was described as unskilled labour, but skilled and unskilled are relative terms. It included all kinds of labour, from Whitechapel Jews turned on to digging and to Chinese fitters repairing tanks. The common characteristic of all labour companies was not that they were

unskilled, but that they were transferable, went from one service to another. They worked under the direction of the technical service to which they were from time to time allotted. To the Labour Directorate was assigned the task of allotting them from week to week or month to month to the technical services under the general instructions of the staff, and of looking after their morale and general well-being.

This then was the general situation. The work of the army was done by the various technical services, working under the general orders of the higher command, and inspired by working for a common end which each man desired and by professional esprit de corps, getting from the Labour Directorate the unskilled or semi-skilled labour they needed. The cash nexus was entirely absent. Its place was taken by the fact that all were working for a common end they all desired, by military discipline, and above all by esprit de corps. It was as though Mr. Cole's Guilds, faced with the fact that the varying character of the demand for their work could not be met by expansion of their own personnel, made application for men to a Guild of unskilled labourers formed out of the General Labourers' Unions, who were allotted from time to time to the various Guilds by some organisation outside the Guilds as the general economic situation demanded.

There were, of course, certain features about the situation which would not be reproduced in the absence of a military system. Whether they existed in the Labour battalions reported in Soviet Russia I do not know. The direction of labour was controlled from above. No man chose what work he should do. He was drafted into this or that service on the orders of the military authorities, and his company was sent to this or that work on orders from the same source.

The reverse side of this arrangement was that men were not thrown back on the labour market when their services were not wanted. They were fed, clothed and paid irrespective of their being employed. Whatever work they were doing, they remained members of the same small society, their labour company. The economic incentive of fear of unemployment had disappeared.

Under these circumstances the theory of the function of the Labour Directorate as set forth in the original memorandum defining its powers was a simple one. It acted as a Labour Exchange, receiving demands for labour from the technical services and allotting the labour available according to the instructions of the staff. In addition it was responsible for the administration of labour companies.

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