So long as individual producers act each for himself, without any knowledge of what others are doing or propose to do, there seems to be no way of adjusting supply to demand. It is reported, January 1, 1892, that the South has $6,500,000 worth of cotton on hand that no one wants. What is the trouble? Simply this: every farmer raised cotton without any means of knowing how much others were raising.

The result is over-production; sales possible only at a loss entailing suffering and in some cases positive ruin. Socialism, through a central bureau, would estimate the probable demand for a given crop and regulate the acreage to be planted accordingly; besides, under Socialism no man would suffer, much less be ruined, by the failure of a particular crop or industry, because his income does not depend solely upon particular, but general, prosperity.

It is sometimes said that the real cause of surplus products is under-consumption rather than over-production, since if the poor only had the means to purchase no accumulation would have happened. This implies other industrial and social conditions than now exist. Socialism alone could make it possible. In 1884 cotton mills, unable to sell their goods, piled them up till storage room failed. The people had all the cotton cloth they needed. It was simply a case of over-production. With the aid of machinery and laborers multiplying as never before it is daily becoming easier to supply the world's needs. Mr. Edward Atkinson states that nine hundred and fifty hands can now make as much cotton cloth as ninety-five thousand hands formerly made. A cotton-mill with $1,000,000 capital produces 17,500,000 yards of cloth per year. A few such mills would supply the entire demand of a great country.

Over-production is an injury to capital and a scourge to labor. Statistical science might possibly find a remedy. Monthly tables showing the amount of production of any given commodity, embracing those countries that are commercially related, issued by an international statistical bureau, might furnish producers with such information as would prevent over-production.

It may fairly be questioned, however, whether such knowledge, under the stimulus of competition and the risks of private enterprise, would be utilized. The law of supply and demand is subject to economic conditions that are constantly changing, and over which frequently man has no control, as the failure of crops.

"These maelstroms, the crises, then, are the direct production of private enterprise." - MR. LAURENCE GRÖNLUND.

Another cause of Socialism closely connected with the foregoing is Commercial Crises. These are seasons of business depressions which bring ruin to capitalists and distress to laborers. For above two hundred years they have occurred with mysterious regularity once in about ten years. "The first three years generally exhibit depression, then you have three years of healthy trade, and then come, say, two years of excited trade. Your ninth year is a bubble, and your tenth year is its explosion and collapse."

1

What are the reasons for these depressions? Political economists are not agreed. Some say the cause is overproduction, due to illegitimate speculation: others, overconsumption; that is, people have lived beyond their means, and retrenchment lessens the demand for commodities, and the result is stagnation.

His theory

Henry George says that land speculation is the true cause of industrial depression in the United States. Rodbertus, the eminent and conservative socialist, maintained that crises result from the fact that the laborer's share of all goods produced continually decreases. made a profound impression. It is thus illustrated. Suppose all goods produced annually amount to a thousand units: the units may be anything a horse or a house. These thousand units must be divided among four parties, landlords, capitalists, laborers, and the State. Landlords take three hundred; capitalists, three hundred; la

1 "Socialism" (Cook), p. 32.

borers, three hundred; and the State, one hundred-total, one thousand. Now, if production increases there is no crisis so long as these proportions are maintained. Laborers have means to purchase what is produced for them. But the moment products increase, these proportions are not maintained; laborers' proportionate share diminishes; capitalists find their share increasing. It is not needed for consumption, and so new factories are built and more goods produced for workmen who cannot buy them; goods are heaped up. Then comes a crash. During the season of depression society supports the poor, capitalists become relatively reduced, and surplus goods are consumed, and things get so far righted that business starts up again, but always in such a way as to handicap the laborers, for so many are seeking work that the employers can dictate

wages.

Thus at both the beginning and the end of the crisis labor is fleeced by capital.

Such is the theory of Rodbertus, whom Professor Wagner of Berlin called the Ricardo of Socialism.

Such is the explanation of the International Working Peoples' Association, which declares that "the increase of products, accompanied by simultaneous decrease of the average income of the working mass of the people, leads to so-called business and commercial crises, when the misery of the wage-workers is forced to the extreme." 1

Socialism declares that the evil is inherent in the capitalistic system. The mischief wrought by these crises, both to capital and labor and through them to all the interests of society, is appalling. When mills shut down and warehouses filled with goods are locked up; when mines are idle, ships laid up, money stowed away in bank vaults, trades paralyzed, and multitudes of working men forced into idleness, to starve in the midst of plenty, or to recruit the ranks of vice and crime, it becomes a matter of the deepest concern, not only to political economy, but to the State and society generally.

We live in a feverish age. The highest premium is put on speed.

1"The Labor Movement in America" (Ely), p. 360.

If Shakespeare could say, in the sixteenth century, "The spirit of the times should teach me speed,"

how shall we fitly characterize the period when steam and electricity are getting to be tediously slow? As the human pulse may be sent flying up to 120 by stimulants or mental excitement, so the industrial pulse, by the passion for wealth, or stimulus of speculation, may be forced to a point above its normal beat, and there for a time maintained; but the reaction must come, or destruction would

ensue.

The crisis therefore is a blessing. The real panic, if we had eyes to see it, is not when the reaction comes, but when production is increasing, trade brisk, and business. humming. Then is the time to contract credits, to sever the alliance with luxury, restrain pride and vanity, and apply the moral and economical fly-wheel to regulate the business pulse. The responsibility, however, for these disastrous crises rests primarily upon the present industrial system.

...

"Pauperism accompanies progress; to see human beings in the most abject, the most helpless and hopeless condition, you must go, not to the unfenced prairies and the log cabins of new clearings in the back woods. . . but to the great cities where the ownership of a little patch of ground is a fortune."-HENRY GEORGE.

One of the direst evils of human society is pauperism. It increases with civilization. It is this startling fact that inspired the title of Henry George's remarkable book, "Progress and Poverty," wherein he says, that as civilization progresses and wealth increases, poverty deepens. "Some get an infinitely better living, but others find it hard to get a living at all. The tramps come with the locomotive, and almshouses and prisons are as surely the marks of material progress as are costly dwellings, rich warehouses, and magnificent churches. Upon streets lighted with gas and patrolled by uniformed policemen, beggars wait for the passer-by, and in the shadow of college, and library, and museum, are gathering the more

hideous Huns and fierce Vandals of whom Macaulay prophesied.1

This is also the indictment of Socialism against the present system of industry. The International Working People's Association says, "The increasing eradication of working forces from the productive process annually increases the percentage of the propertyless population, which become pauperized and are driven to crime, vagabondage, prostitution, suicide, starvation, and general depravity. This system is unjust, insane, and murderous. It is therefore necessary to totally destroy it." We are forced to admit that poverty and paupers increase with wealth and luxury. The explanation is to be found in the capitalistic system which has outgrown its social utility and become unjust and vicious.

Lazy and shiftless people always exist, but they need not be paupers. In primitive conditions of society, where all labor, pauperism is unknown. Any system wherein the prosperity of some necessarily involves the impoverishment of others is fearfully wrong somewhere.

Among the secondary causes of pauperism there are moral, educational, and religious considerations of great importance, but we are now concerned with the industrial causes, chief among which is enforced idleness. Ninety thousand in England, in the last half-year of 1860 were idle, while during the same period much machinery was standing idle for want of hands. The consequent suffering among the working classes caused Carlyle to exclaim, "Enforced idleness is the Englishman's hell.”

During the year including May 1, 1885, out of a working force of 816,470 persons in Massachusetts, one-third were idle a little over four months, or about one-third of the year. We have no means of knowing what proportion of this idleness was involuntary. Enforced idleness will not be endured to any great extent in a government of the people. When freemen whose daily bread depends upon

2 The Eighteenth Annual Report of the Bureau of Statistics of Labor.