Current Economic Affairs/Chapter 13
CHAPTER XIII
THE NEED FOR LEADERSHIP
I have tried to make it clear in these studies that the people of the United States are living in a state of economic unbalance, first as between property and management on the one hand and wage-earning labor on the other; and secondly among wage-earners themselves. This is producing a reduction in personal efficiency and at the same time an extravagance in living, which is largely at the expense of the national principal itself. So long as these conditions prevail we shall be in a situation of economic instability. While there may be temporarily some advantage in this to certain groups of workers at the expense of the owners of capital and of other groups of workers, it is certain that the workers themselves as a whole will in the long run suffer the most injury from restricted production and maldivision of it.
Now, I do not ascribe blame upon anybody for deliberately bringing about and seeking to perpetuate bad conditions. They are the natural consequences of the upheaval of the war and of human nature as it is constituted, and just as their development has been inevitable so will be their correction. The great question is whether the correction can be instituted short of ruin, so that it may be completed in 20 years, let us say; or whether the evils will go so far as to produce a downfall from which the recovery may be a matter of centuries as was the experience after the wreck of earlier civilizations. The fortunate few who exult in their temporary well-being and the unfortunate mnillions who bewail their present misery are equally ignorant of what is really happening and whither things are trending. They can not even grasp the facts and the logical deductions from them when they are informed respecting them. Salvation depends therefore upon intelligence undertaking to lead the way and persuading the masses to defer to it before dire necessity imposes its irresistible constraint.
The most conspicuous states of mind among the classes of people of the United States at the present time is expressed in the phrase ‘‘ Discontent among the farmers,” and the declared intention of labor to “‘hold its own.” In the words of an eminent political newspaper correspondent. recently making a survey of sentiment in the corn-growing states.
The farmers are sullen, and grow more so every day. If you should ask of a hundred farmers the reason for their discontent, they would all answer in practically the same words: “Low prices for what we have to sell; high prices for what we have to buy.”
What is characterized as being a radical, “almost bolshevist,” movement was rampant in Iowa. Anyone who has read my writings is aware that socialism and bolshevism are anathema to me, but we all know that the farmers are not socialistic by instinct or nature, although now and then they allow socialistic experiments to be foisted upon them, as in North Dakota. ] find, however, that one of the present exponents of. radicalism in Iowa is against high taxes, against the ship subsidy project and against the conditions that make for high railway rates. If this be radicalism, and if conservatism means high tariffs, ship subsidies and all the other economic evils that are being perpetrated, I am in favor of such “radicalism.”
The Iowa exponent denounced the policy of general deflation, but that is not surprising. Whenever the farmer becomes the victim of low prices for his products and high prices for the things he must buy, and moreover is bothered by his debts, his mind becomes financial, and he begins to think in terms of cheap money. Like the average man, floundering amidst the intricacies of economics and finance, his thoughts, if they be not completely vague, turn around among all kinds of erroneous ideas and rank heresies.
In the industrial parts of the country, there is a high degree of satisfaction and the enjoyment of luxuries including the luxury of leisure, and especially has this been so since the settlement of the strikes of 1922, although Samuel Gompers writes that “Labor has repeatedly made the charge that there exists a conspiracy to destroy the trade union movement.” Intelligent people know that Mr. Gompers is talking merely for effect, and that there is in fact no such concerted movement, although there ought to be. In the meanwhile, we read in the newspapers items like the following:
Leslie L. Lanker, of Summerville, Pa., drew $247 in pay for 11 days work as miner in the pits of the Oak Valley Coal Co. He worked a regular eight-hour shift and was paid at the rate of $1 per ton of coal loaded.
Mike Rancher, who works in a coal mine at Rockwood, Pa., Friday drew $291.45 for two weeks’ work, eight hours each day.
It appears that Lanker averaged about 22.5 tons of coal per eight hours or 2.8 tons per hour—Rancher did a little better—24.3 ton per eight hours, or about three tons per hour. Each of them did an honest days’ work, but nothing extraordinary in so far as physical capacity is concerned.
It was one of the same class of workers as Mr. Lanker and Mr. Rancher who was addressed by a newspaper correspondent when in the act of buying a new, expensive automobile, and being congratulated upon his prosperity and being interrogated about his unfortunate, or fortunate, obligation to pay income tax, replied contemptuously: “What ya givin’ me? I don’t pay no income tax. I’m a workin’ man, I am.”
Among the pictures that we can see in this kaleidoscope there are others. I have heard working people in New England deploring that they must now pay $20 per ton for anthracite coal, shivering as they talk about it, for the New England winters are cold, and there was the implication that there would not be very much coal coming to these people at that price.
Such little pictures, which after all illustrate just what the people are talking about, are translatable into economic language and into revelations of the factors that are operating beneath the surface, and that ought to be understood.
The Western farmer gets but low prices, even lower than the pre-war, for his products, owing to the impoverishment of Europe, that curtails the demand for his exportable surplus, which demand makes the market. No tariff on agricultural products and no political formula can alter this condition.
On the other hand, the things that he has to buy are high, at least 1.7 times the pre-war, because town labor, including the railway workers, has been able so far to maintain greatly enhanced wages, refusing to participate in the deflation that inevitably overtook the farmers and other people, and will in the end enforce itself upon all labor, willy-nilly.
When the farmer ships a carload of hogs to Chicago and finds that the produce of his hard work, which knows no eight-hour day, has vanished into nothingness, it is not the railway companies and the packing companies that have appropriated it, but it is the railway men and every other class of laboring man who has participated in the transportation, manufacturing and distribution of the food products, right down the line to the ultimate consumer.
Similarly, when the farmer buys his clothing at 1.7 times the pre-war price, probably for shoddy goods at that—and when the New England scrubwoman has to pay at the rate of $20 per ton for half a ton of anthracite—it is not the woolen manufacturer nor the anthracite coal-mining company that extort the price, but it is the miners and mill men, and again the railway men, the carters and all others who have to do with the handling of the goods.
For this situation also there is no political panacea. The thoughts of the Western farmers turning erroneously to money jugglery dwell moreover upon new governmental activities, such as more regulation and even renewed operation of the railways. Those would be the worst things that could happen, as Mr. McAdoo showed us thoroughly.
The aristocrats of labor, having come into possession of an undue part of the produce of the farmers and other people, buy profusely of automobiles and exercise a great deal of choice about their work, refusing to do anything but what is agreeable and being able to have their way by virtue of getting enough wherewith to live out of relatively little work.
All of this means simply the hogging by comparatively few people of an unduly large share of a diminished national production. In other words, it is unbalanced distribution of the produce of industry. This can not continue indefinitely unless the American people have discovered a way of making something out of nothing. The charlatans who are now talking to the farmers do so in words that are capable of translation into the representation that such a discovery has been made and the farmers are beguiled into believing them. Of course, the governmental operation of railways and other services, the erection of tariff barriers, the blowing of credit bubbles, etc., mean nothing else, for none of those things contributes to increased production, which can only be accomplished by hard work, invention, good management, and thrift. Dissension between the agricultural workers and the town workers, as we see it now, was bound to come.
I think that the United States is about the last country in the world where socialism and communism can make headway, although there are plenty of propagandists for those terrible things who (generally for selfish purposes) aim to promote them and play upon the ignorant. However, Americans are too individualistic and too capitalistic, by great majority, to get into either of those boats. The only real danger is in letting themselves be guided into quagmires and letting silly experiments be tried upon them by charlatans and disingenuous prophets.
I feel great sympathy with the discontent that prevails. I look upon the confusion in minds as being very human. Radicalism in the United States means to me dissatisfaction with the state of affairs and ignorant, foolish gropings to make things better. Conservatism seems to mean the avoiding of some foolish things and the perpetration of others conceived as panaceas. Coxey is the prototype of the leadership of one party; old Doctor Swamproot of the other. The people, in their pre-election discussions of 1922 expressed their helpless recognition of the futility of the politicians and their grudge against the politicians of all types who ought to have led them and did not.
The country is hungry for strong, sound leadership, of the kind that has no selfish thought for offices, party power, or the next election—leadership that has the knowledge to understand conditions and the courage to tell things truly, no matter how unpalatable they may be. Such leadership would teach that the war did not add to our national wealth, but that it produced great dislocations among our economic conditions and great unbalance in the distribution of the produce of our industry. The old balance must be restored as nearly and as swiftly as possible. Deflation, instead of a thing to be resented, should be speeded along. The farmer, having suffered this first, can not be helped by anybody blowing bubbles, but he can be helped by deflating labor generally. Wall Street, meaning collective busmess, has no interest except to see everybody, farmers and labor alike, prosperous so that there will be goods to be bought and sold and freight to be carried. It is town labor that stands in the way of farmers and white-collar classes alike. If governmental agencies are an obstacle to labor deflation abolish them. Appeal not to the government for any further regulation of business for the hand of the government is the touch of death. On the contrary, curtail the government’s own activities—not merely the Federal but also the state, county and municipal managements—and thus reduce taxes, which are being abated but little, if any at all, and ipso facto are opposing deflation. We may need many public improvements, but ought to forego them if we can not afford them. We must help Europe and must buy goods from her in order to sell to her.
These are some of the truths that real leaders would preach, but above everything else they would proclaim that the war did not do anything to raise permanently our scale of living, that the entrance of some people upon the enjoyment of such luxuries as never before was paid for by the patriotic by mortgaging their principal, and that the present is a time that calls for hard work in production, economy in living, and thrift in saving. It is leadership along these lines, and these only, that will remove the present discontent and promote the general welfare. If anybody should not like it—and the labor unions will not—the sooner they be brushed away, without any further catering to them, the better it will be.
Collapse of the principle of authority and absence of leadership spell chaos. Self-seeking politicians, wilfully acting in groups, are unable to accomplish anything for the welfare of their people. The whole system of popular government breaks down and eventually the people in their despair welcome the advent of a dictatorship, which can at least do something. Thus we see in Continental Europe five years after the end of the war that was represented as being fought to make the world safe for democracy, the downfall of attempts at popular government and the substitution of tyrannies in many countries. Such is not an outcome to arouse enthusiasm, for there is too much risk in it. Blessed may be the country that falls under a benign dictatorship like that of Mussolini and cursed is that which suffers the malign despotism of a Lenin.