Chapter VIII. A Picture of State Socialism

'CHAPTER VIII A PICTURE OF STATE SOCIALISM ANYOne •who wants a detailed picture of the manner in whic~ the State might, obtain control of the means of production ,and organize industry to the ,exclusion of the private capitalist, can find it in a book called The Ragged-Trousered' Pk£lanthrop£st, by Robert Tressall, published in April 1914 by Grant Richards. It isa tragic and, very interesting book, and is said to have been written by a Socialistic house-painter, who died soon after writing it. It describes the experi ences of an educated workingman, with high ideals of work and life, employed by a very third rate firm of bunders and decorators among a crowd of jeering and illiterate companions, whom he tried to stimulate to accept his own 'views on Socialism, as qeing the only remedy for the evils under which he and they suffered. In the last chapter ,this idealist, finding himself threatened with deadly disease, decides that the 169 170 THE CASE FOR CAPITALISM kindest thing to do for his wife and son is to t~ke them with him out of a world which seem,~~ to him hopeless. It is a terrible book, and as , a picture of the black side of the present economic arrangements of society, is well worth study.

The most interesting pages in it-,· apart from the roughly hunlorousdescriptions of the gaiety with which these unfortunate, underpaid, and overdri yen workers face the misery. of their lot -are those in which the idealist worker, Frank Owen, describes to hisconlpanions, in answer to their jeering questions, the means by which their lot· could be bettered. In the course of one of· these orations he gives a detailed and ingenious description of the birth of the Socialistic State (page 334). He begins by dea~ ing with the land, saying that a large part of it may be' got back U in the same way as it was taken from us. The ancestors of the pres~nt holders obtained possession of it by simply passing Acts of Enclosure ; the' nation should regain possession of those lands by passing Acts of Resumption." As to the rest of the land, he suggested that the present holders. should be allowed to keep it during theirJives and that it should then revert to' the State " to be used for. the benefit of all." The railways, PICTl}REOF STATE SOCIALISM 171 of course, would be nationalized at once. All railway servants, managers and officials would continue their work, being henceforward in the employ of the State. The State 'would pay to shareholders the average dividends they had received during the previous three. years, these payments being continued to the present share holders for life, or for a stated nunlber of years, and the shares would be made non--transferable.

As for the factories, shops, and other means of production and distribution, the .State would "adopt the same method of doing. business as the present owners." The speaker argues that :even as the big Trusts and Companies are -c.rushing by competition the individual workers and sn1aH traders, so the State should crush the Trusts by competition. "I t is surely justifiable for the· State to do for the benefit of the .whole people that which the capitalists are already doing .. for the profit of a few shareholders." The first step would be the establishment of r~tail stores for the purpose of supplying all national. and municipal employees with the hecessariesof life at the lowest· possible prices. The Gov:ernmentwould buy these goods from private rnanufacturers in such large quantities that it would be able to get them at the very cheapest rate, and as there would be no high 172 THE CASE FOR CAPITALISM· rents to pay·for sh9wy shops, and no advertising expenses, and as the Government would not be aiming at profit, it would be . able to sell much cheaper than the profit-making private storeS: These N ationalService Retail Stores would only serve those in the public service; and coined money would not be taken by them in payment for the things, sold. At first all public servants would continue to. be paid in ,metal money,1 but those who wished it would be paid all or part of their wages in paper money, which would be taken in payment for their purchases at the National Stores, National Hotels,Noational Restaurants, and other places which would be established for the convenience of those in the State service.

Owing to .the cheapness of the articles that it would, 'command, the ·paper. money would win' increasing· favour, and aU public servants' would 'soon 'prefer to have all their wages paid "in. it. ',The Government, however, would still need metal-money to pay. the manufacturers who,supplied .the goods sold in the National Stores. But to avoid buying all these things from.· them the State would ·then· b.egin to produce for. itself. . . , 1 At the' time when' Mr. Tressall's book ·was· written, we had a goldcurrency in England.

PICTURE OF STATE SOCIALISM 173 Public lands would be cultivated, and public factories would be started to produce food, boots, clothing, furniture and all other neces saries and con1forts of life.. All who were out· of employment and willing to work would be given work on these farms 'and in these factories, which would b~ "equipped with the most up-to-date and efficient labour-saving machinery." How the State is going to get the machinery. is not made clear. Perhaps it could provide the necessary money by taxation, if by that time there were anyone left to tax, or perhaps it would jast take it. From its . farms and factories so eq~ipped· it would pour out a great flood of cheap goods, and all public servants would revel in c.' abundance of every thing." When the workers who were being cc exploited and sweated" by the private capita lists· saw what was happening, they would come and ask to be allowed to work for the State.

" That will mean that the State army of pro ductionworkers will be continually increasing in numbers. More State factories will be built, moreland ,viII be put into cultivation. 1\ien will be given en1ployment making bricks, woodwork, paints, glass, wall-.papers and all kinds of building materials; and others will be set to work. building, on State 'land, beautiful 174 THE CASE FOR CAPITALISM houses, which will be let to those employed in the service of the State. The rent will be paid with paper money." State fishing-fleets· would be the next State enterprise, and in order to deal with the u great and continuously increasing .surplus stock" in its hands, the Government would acquire or build. fleets of steam trading-vessels, manned and officered by State employees, to carry the surplus stocks to foreign countries, to be sold or exchanged' for foreign product~,which would be brought to England and sold at the National Service Stores, at the lowest possible price, for paper money, to those in the service of the .State. A detachment of the Industrial Army would be employed as actors, artists and musicians, singers and entertainers. Everyone that could be spared from producing necessaries would·be set to work to create pleasure,. culture and education.

Meanwhile, private employers and capitalists would ·find that no one would come and work for them "to be driven and bullied and sweated for a miserable trifle of metal money,"and some might threaten to leave the country and take their capital with thenl. "As most of these persons are too lazy to work, and as we shall not need their money, we shall be very PICTURE OF S'I'ATE SOCIALISM 175 glad to see them go." But their real capital, their factories, farms, mines or machinery, would be a different matter. So a law would be passed, declaring that all land not cultivated by the owner or any factory shut down for more than a specified time, would be taken possession of by the State and worked for the benefit of the community. Fair compensation would be paid in paper money to the .farnler owners, who would be granted .an income or pension either for life or for a stated. period. Wholesale and retail dealers would be forced to close down their shops· and warehouses, first, because they would not be able to replenish their stocks, and secondly because even if they were they ·would· not be able to sell them.

This would throw out of work a great host of people 'c. at present engaged in useless occupa tions, such as managers' and assistants in shops of which there are now half a rdozen of the same sort in a single street, and the thousands of men and women who are slaving away their lives producing advertisements. Thesepeople are in most cases working for such a nliserable pittance of metal .nl0ney that they are unable to procure sufficient of the necessaries of life to secure them from starvation. H (H ere the writer surely overstates his case.) But all 176 THE CASE FOR CAPITALISM those who are willing to work would be at once employed by the State in producing or distribut ing the necessaries and comforts .. of life. The Governmentwould build houses for the families of all those in its employment; and all other house property of all kinds would rapidly fall in value. H The slums and the wretched dwell ings now occupied by the working-classes, the . miserable, uncomfortable, jerry-built 'villas' occupied by the lower middle-classes and by ( business' people,win be left empty and value less upon the hands of their rack-renting land lords, who will very soon. voluntarily offer to hand them, and the ground they stand upon, to the State on those terms accorded to the other property owners,namely, in return for a pension.)) By this time the nation would be .the only employer, and as no one would be able to get the necessaries of life without paper money, and as the only way to get it would be by working, every mentally and physically capable person in the community would be helping in the great work of production and distribution.

There would be no unemployed and no over lapping. For everyone labour-saving machine in use to-day,. the State would, if necessary, employ a thousand, and there would be produced PICTURE OF STATE SOCIALISM 177 such a et stupendous, enormous, prodigious, overwhelming abundance of everything," that soon it would. be necessary to reduce the hours of the workers to four or five hours a day. All young people, would remain at the' schools and universlties until· they were twenty-one years of age. At forty-five everyone would retire on full pay. "Thus, for the first time in 'the history of humanity, the benefits and'pleasures conferre,d upon ,mankind by science and ,civili zation will be enjoyed equally by all,upon the one. condition, that they shall. do their' share of the work in order to make all these things' possible. These are the principles 'upon which the Co-operative Commonwealth 'will be organ ized; the State in. which no one will be distinguished or <honoured abo've ,his fellows except for Virtue or Talent ; where no man will find his profit in another's loss, and we shall no longer be masters and servants; 'but brothers, freemen, and friends; where there will be no weary broken 'nlen' and women passing their joyless lives in toil ang want, and no little children crying because they are hungry or cold." .

I, have given this detailed summary largely .in 1\1r. Tressall's' own words, because it is. the only picture, of a Socialistic State that I know M 178 THE CASE FOR CAPITALISM which works out in detail how it came into being. vVilliam Morris' beautiful dream in News from Nowhere shows us life under Sociali~m but does not tell us how it came about, or even how the material ·needs· of the Socialistic community were met.· ·Mr.·Tressall's scheme, though it . bristles with obvious diffi culties and involves some injustices, is not altogether ·impracticable and, ·while the mere suggestion of paper nloney in connection·with a .Socialistic Government makes one shudder in the light of recent experiences, there. is nothing .necessarily unsound ·inhis paper money as long·. as its authors did not make too much of it. Most of us will admit that the picture. is in many ways htghly attractive, and that if the writer's ideals could be secured by the methods that he proposes i.t ·would .be worth while"to sacrifice a good deal, in·order to obtain them.

But some very large assumptions are involved by his exposition. In the first place, he gives to the State officials a. power· of organization which is, at present more· notable as an effort of idealist imagination than likely to be realized in the world of fact; and it also assumes efficiency and alacrity on the part of those who work for· the State concerning·. which ·one ·can only feel a certain amount of scepticism.

PICTURE OF STATE SOCIALISM 179 Ifit involves certain injustices, Mr. Tressall's scheme also carries with it,·if it could be car'ried out, very great benefits to a very large pro portion of the population. But there remains still the question whether, if we could swailow all the injustices and all the assumptions in return for all· the promised benefits, the result achieved would be one in which anything like economic freedonl would he secured,and in which the nation as a whole would be better off in every sense of the word. Onthissubject, as has already been observed, the most outspoken critics of State Socialism are the exponents of the new variety of Socialism known as Guild Socialism. Mr. Cole, who has already been quoted in former chapters, says on page 5 of his book on Self Gov.e.wmentin Industry that "Before the war the problem of industrial control had forced its way to· the front. State Socialism, in part a bureaucratic and Prussianizing movement and in part a reaction against the distribution of wealth·in capitalist society, continued to develop) at least in itsPrussianaspects~ But.

from the working-class point of view, StC;\te Socialism was intellectually bankrupt. The vast ·system of regimentation inaugurated by the Insurance Act was opening men's eyes 180 THE CASE FOR CAPITALISM to the dangers of State control, and, in those services, such as the post office, which were already publicly administered, discontent was growing because the State and municipal em ployees found that they were no less wage slaves than the enlployees of private profiteers." And on page I 14: "The crying need of our days is the need for freedom. Machinery and Capitalism between them have made the worker arnere serf, with no interest in the product of his own labour beyond the inadequate wage which he secures by it. 'The Collectivist State would only make his position better by securing him a better wage, even if we assume that ·Collectivismcan ever acquire the driving-power to put its ideas into practice: in other respects it would leave the ,veaker-[presu111ably a misprint for "worker "J essentially as he is now-a .wage slave, subject to the will of a master inlposed on him from without. How ...

ever denlocratically-nlindedParlianlent nlight be, it would none the less remain, for the worker in any industry, a purely external force, imposing its commands from outside and from above. The pos,tal workers are no more free while the post office is l11anaged by a State department than Trade Unionists would be free if their Executive Comnlittees PICTURE OF' STATE SOCIALISM 181 were appointed by His Majesty's.Minister of Labour." Equallyenlphatic is a book called National Guilds: an Enquiry into the Wage Systenz and the Way Oul,which is described on its cover as by A. !{. Orage, and on its title-page as by S. G. Hobson, edited by A. R.. Orage. On page 21, the Hobson-Orage partnership observes that" there is this in common between lVlunicipal and State Socialisn1 : both are equally committed to the exploitation of labour by means of the wage systenl) to the aggrandise ment of the municipal investor. State Social ism is State capitalisln, with the private capitalist better protected than < when he was dependent upon voluntary effort."

Later on, on page 153, they say that they "have shown that the continuance of the wage system is inevitable if the State Socialist prevails, since he can only acquire productive and distributive undertakings by paymel1t of a compensation that would bear as heavily upon labour as the present burden of rent,. interest, and profits." <And the champion of Guild Socialism who has published the latest book on the subject, Mr. G. R. Stirling Taylor, deals roughly with the question of bureaucratic efficiency. .

182 THE CASE, FOR CAPITALISl\I " Bureaucracy," he says,l U as a matter of fact, does not choose expert workers; it chooses first-class bureaucrats. It\vould be inhunlan if it did not look upon the world with the rather timid eyes of the sedentary clerk. It probably thinks that the world can be saved if asuffi cient number of letters and reports are written about it. There are hundreds and thousands of clever, self-sacrificing officials in Government offices, who pass their lives in helpful. work. But the most helpful work they can do is to stand on one side, and not act asa buffer between the men who are thenlselves pro ducingand the community "vhich .is receiving. It is not that all· Government officials are dishonest or foolish; most of them are the reverse. The bad thing about them all is that they are clerks, and wealth is not made by clerks." Thus all the attractions, such as' they. are', of State Socialism for those who see how black are the effects of the present system, are dismissed as a fraudulent and futile chimera by the advocates of the latest form ofSocia1is~ic zeal, namely the National Guilds. In the meantime the Capitalist may chuckle as .he see~ the Socialism that was the bogey of hi$ 1 The Guild State, page 59.

PICTURE OF STATE SOCIALISM 183 childhood derided by Socialists of. the latest brand, and wonder when anew vintage, equally contemptuous of the Guildsnlen,will.. come into fashion. The schemes which:tbese ingenious.gentlemen put forward· for the bettering of our lot will be examined in later chapters. In the mean time their criticisms of State S.ocialismare by no means necessarily decisive. Labour leaders seem to be in favour of nationalizing every thing, though it is by no means clear that thereby they voice the real opinions of those whOln .they are alleged to represent. They seem to think that sOInehow nationalization can be adopted without involving the bureaucratic control which they· emphatically flout. Mr. Brace in the House or Commons, Nov. 28,1919, said, "The mining people are driven to despair at this blunder in·. connection with the Coal Controller's department. . . . This is not how nationalization would work. Ifit were I would oppose it. This is bureaucratic con trol pure and simple, and it is the worst of all systems. Better far go back to private ownership and private contro}." But he did not explain .how·· nationalization could be accomplished and bureaucratic control avoided.

Whatever attempts are made to dodge it by 184 THE CASE FOR CAPITALISM means of. committees and district councils, nationaliza~ion must surely mean that the' nation puts money into an industry, and so Treasury control becomes inevitable" with all its con sequences. A.stateof society in whIch everybody worked and nobody was overpaid and nobody was underpaid, and everybody.enjoyed a fair share of an overwhelming abundance of the good things of life has certainly enormous advantages to recommend it, if it can be attained, as compared with our present system., N everthe less, e'ven this' is only to be secured, according to its advocates, by the introduction of a system which might 'carry with it very deadening drawbacks. Mr. Cole deals a deadly blow at State. Socialism when he speaks' of the," regi me,ntation" involved by it, anddescr~bes it as a Prussianizing· movement. In order to obtain the very great economy in production, which is .certainly .possible if a really· 'efficient State administration took the, business. in hand, decided what was good' for the community to consume, and then set fhe whole energies of the nation on to producing those particular articles, it would .be necessary to lose the freedom of choice in production and consumption which our present systemg~ves us, involving PICTURE OF STATE SOCIALISM 185 some waste, but at the same time conferring certain benefits \vhich a.re rightly very dear to the great majority of mankind, and will continue to be so.

To most of us, to find ourselves members of a monstrous organization which regulated our lives from our birth to our death, telling us·· what work 'we are to do, what necessaries of life· we are to consume, and what pleasures we are to enjoy, would seem to be a fate under which, though we might get a much larger supply of some of the good things of life than we now enjoy, we' should only do so through the sacrifice of all the freedom and' fumbling and failure which make life worth living because they are our own fault and make men and women of us by testing us and battering us with our owp blunders and teaching us to take risks~ It might be cheaper to ,have national retail stores at which we all had to shop, instead of haIfa dozen shops in' the same street i competing .for our customj but should we .. be so well served, and should we have the same variety of choice, and should we, not suffer very 'considerable inconvenience by having our wants supplied by people who had noincenti ve of private gain to spur them to do the best that they can for their customers ?

186 THE CASE FOR CAPITALISM As human nature is at present, it seems most probable that our dealings with the great Government stores might often be very un comfortable, disagreeable and unsatisfying. It' has long been a commonplace that the difference of spirit in which one is served ata post ,office and at a private shop which depend~onits customers' goodwiUfor its profits"is markedly in ,favour of the latter. And a very inter esting confirmation of 'the incentive of profit in rendering services, to the consumer has been provided during ,the late war, when, owing to restrictio..ns on the supply of goods and the absence of competition, shopkeepers no longer had the same need to observe ordinary courtesy towards their customers. It is often assumed by Soci'alistic enthusiasts that when once profit-making and competition are eliminated 'everyone will be sunny and kindly and helpful. How far this theory is from, fact' was made clear to any one who during the war wanted to buy a pound of sugar or a box of matches or anything in which profit was automatic and ,competition" was suspended.

But even if this were not SOt if we not only had abundance, which is doubtfu', but also pleasant and kindly relations between producer PICTURE OF STATE SOCIALISM 187 and consumer,which is. problematical,would it make up for the loss of the old freedom to make mistakes in our own way and so attain to that development which is only possible to those who have a chance of doing and being wrong? To quote 1\1r. Stirling Taylor again: "Doing the wrong thing ourselves is often more stimulating than doing the right thing because somebody else orders it." To have all the pitfalls of' life .filled in and fenced off by bureaucratic efficiency would make it a very comfortable proceeding perhaps, but as exhilarating and stitTIulating as a journey through a tunnel in a Pullnlan car. If it were the only possible cure for destitution, then perhaps nine~tenths of us might sul;lmit to it, with resignation, in the interests of 'the no"v unfortu nate tenth. But is there no other way of solving this terrible' problenl but by living in a society which at best would be a· glorified and well-appointed workhouse? If there is any other ,vay, surely those who believe that a sound and good people can only be made out of sound and good individuals, and that' no individuals. can learn to be sound and good except by. facing. life's problems. for thenl selves, are entitled, and bound, to resist the regimentation and tyranny involved 188 THE CASE FOR CAPITALISM by State Socialism. Under it the individual would have as much chance of development and progress as a fowl in an intensive poultry farm, and would probably be not nearly as well fed as they are.