Tuesday, July 1, 2008

Gladstonian Ghosts - Social Reconstruction

In previous chapters I have generally begun by criticising the Liberal policy in relation to the matter to be discussed. It would seem natural in this chapter to deal with the Liberal policy in relation to social reform. But in that case the essay would be an exceedingly short one. There is no Liberal policy in relation to social reform.

The nearest thing to a least common denominator which I can find after searching diligently the speeches of the Liberal leaders and their backers is that most of them are in favour of doing something to the "land monopoly." Exactly what they propose to do to it I cannot quite discover. "Over-throwing the land monopoly" may mean Leasehold Enfranchisement; it may mean the Taxation of Land Values; it may mean Small Holdings, Free Sale or the Nationalisation of Land. The last suggestion may be dismissed; we are certainly no more likely to get that from the Liberals than from the Tories. Small Holdings are excellent things, but the principle has been conceded, and we are as likely to get a further extension of it from the Tories as from the Liberals, in any case this policy does not touch the essence of the social question. Leasehold Enfranchisement, Free Sale, etc., are sham reforms of middle-class origin of which we now hear little. There remains the Taxation of Land Values.

The Taxation of Land Values is very popular with the Liberals just now. Whether it would be equally popular with them were they in office is perhaps a matter for legitimate speculation. It will be remembered that it was part of their programme in 1892, and is to this day faintly discernable on the newly cleaned slate of the party. As however it is re-emerging into prominence it may be well to say something in reference to it.

A good deal of confusion is inevitable concerning this particular proposal, arising from the fact that it may be regarded in two entirely different lights. It may be considered simply as one way among many others of raising revenue to meet necessary public expenditure, or it may be regarded as a practical application of the economic doctrines associated with the name of Henry George, who taught that all revenue should be raised by a single tax (or more properly rent) on the site value of land. Now Georgian economics have made practically no headway in this country; their a priori logic their reliance on abstract assumptions rather than on history and practical experiment, their rigidity and inflexibility of application, are exasperating to a people naturally impatient of metaphysics but keenly alive to immediate social needs. People who begin their economic speculations, as the Georgites generally do, by discussing what are the natural rights of man and deducing from this an ideally perfect system of taxation and government put themselves out of court with practical men. There are no natural rights of man; there is no abstractly perfect economic of political system; we are painfully struggling by means of many experiments and many failures towards something like a decently workable one.

But, though Georgism is a horse so dead that to flog it would be profitless malignity, the taxation of land values, conceived not as the only means of raising revenue, but as an additional means of doing so, is very much in favour both with some of the leaders and with the whole rank and file of the Opposition. Nor is the reason far to seek. The misery and waste produced by our present social system are so patent and terrible that a vague feeling that "something must be done" has been spreading rapidly through all classes, and even Liberals have caught the infection. Most drastic reforms however are impossible for them because such reforms would clash with the interests of the capitalists and traders who form the backbone of the party. To them therefore the proposal to tax land values comes as a special inter- position of Providence to succour them in their need. It professes to do something for the poor, exactly what they might find some difficulty in saying. But a certain amount of ill-digested Georgism can be exploited in support of their case, while at the same time a loud and definite appeal can be made to the Liberal capitalists and the Liberal bourgeoise to share in the plunder of the land-owners. Unfortunately the cock will not fight. The working classes, not believing in Georgian economics, are, because of the hardness of their hearts, supremely indifferent to the taxation of land values. Neither the ingenuity of eccentric economists nor the eloquence of Liberal capitalists can induce them to take the slightest interest in the subject. No Trades Union Congress can be persuaded to take it up; no Labour candidate will make it a prominent plank in his platform. The workers may not be expert economists, but they are not quite so easily deluded as the Liberals suppose. They have a very shrewd eye to their own interests, and are quite acute enough to know that it is the capitalist and not the landlord who is the most active and dangerous enemy of the labourer, and to perceive that the talk about "the land monopoly" is merely a clever if somewhat transparent dodge on the part of the former to divert public indignation from himself to his sleeping partner in exploitation.

I am for getting the last farthing of unearned increment wherever it can be got. But I can see no earthly reason for taxing unearned increment from land more than any other kind. What we really want is a heavily graduated income tax with a discrimination against unearned incomes. This would hit the landlord and the capitalist equally hard, and is therefore not likely to find favour with the Liberal party.

But even if the taxation of land values were as perfect a method of raising revenue for public purposes as its advocates assert, it would still be necessary to insist that no alteration in the incidence of taxation will ever solve the problem of poverty. Suppose that you have got every penny of unearned increment into the public treasury, the question then arises: What are you going to do with it? If you keep it locked up in a box, the last state of the people will be worse than the first. If it is to be of benefit to anybody this revenue must be used by the State as industrial capital. That is to say the socialisation of industry must go hand in hand with the reform of taxation.

Now what the Labour party really wants just now is two or three genuine installments of Socialism on which to concentrate its energies. A party without a programme is always an absurdity; a labour party without a programme is an absurdity passing the just limits of farce. It is futile to think that you can keep a party together much less build up a new one, with no common basis save the desire to amend trade union law, which appears to be the only demand on which the L.R.C. is united at present.

And the programme of the Labour party must, for reasons already cited, be a Socialist and not a Liberal programme. I do not mean that the whole party should call itself Socialist or should be committed to Socialism as that term is understood by the S.D.F. We have been surfeited in the past with abstract resolutions in favour of "the socialisation of all the means of production, distribution and exchange." But I do maintain that the programme must be collectivist in tendency and must have the organisation of industry by the state and the abolition of industrial parasitism as its ultimate goal. Also it must as far as possible appeal directly to the interests of the people for with all his great qualities the British workman is constitutionary defective in the capacity for seeing far before his nose, and will not readily grow enthusiastic about the soundest economic measure which does not obviously improve the position of his class. At the same time the labour party would do well to avoid too much narrowness of outlook, since there are, as we shall see, some measures which do not appear at first sight to benefit the worker directly, but which are indispensable conditions of his ultimate emancipation. Such measures should therefore be put along side of the more patently beneficial one and their connection with these as far as possible made plain to the electorate.

The greatest strides which applied Socialism has made during the last twenty years have been made in connection with the municipalities. The best proof that can be given of the immense and salutary growth of municipal activity in recent years is to be found in the angry panic which this growth has produced among the financial exploiters of public needs. The latter, having at their back boundless wealth and influence, a powerful and lavishly endowed organisation, a vast army of lecturers and pamphleteers, and the greatest and most weighty of British newspapers, opened a year or so ago a fierce campaign against what they called "Municipal Socialism." Never did so potent an army suffer so humiliating a reverse. On the progress of municipal trading the attack made no impression whatsoever. The public at large saw through the game and gave the public-spirited authorities their generous and energetic support. The municipal movement has received no check; it has gone on more triumphantly than ever. Energetic local bodies have pushed their activities further and taken the satisfaction of public needs more and more out of the hands of private speculators, vesting it in those of responsible public officials. But the opponents of municipalism are still active, clever and unscrupulous; and we cannot afford to leave the public interest at any disadvantage in dealing with them. It is unquestionably at such a disadvantage at present, partly on account of the inconveniently restricted boundaries of local areas, partly because of the anti-progressive bias of the Local Government Board, and partly because of the state of the law in regard to the powers of local authorities. The first point has been discussed so excellently by Mr. H. G. Wells and others that I need do no more than allude to it here; with the second I shall deal later. But the third is of special importance.

In the present state of the law a private individual or a collection of private individuals may do anything which the law does not expressly forbid; but a municipality or local body of any kind may only do what the law expressly permits. Thus for instance the London County Council has by law the power to run trams, but when it attempted to run an omnibus line to and from its tram terminus, the private omnibus companies successfully invoked the law against it. This is absurd; it is intolerable that a public authority should not be permitted to supply what its constituents definitely demand with- out going to a largely indifferent and largely hostile parliament for permission to do so. Broadly speaking County and Borough Councils at any rate should have power to do anything that the nation through the national legislature does not definitely prohibit. It would be well for the Labour party in Parliament to demand a free hand for progressive municipalities such as can only be secured by legislation on these lines. The Housing Question connects itself closely with this matter, for its only possible solution will be found to be along the lines of municipal activity. But, in addition to a free hand for municipalities to build houses when and where they like, it would be well to consider whether in the face of the present house famine it is wise to raise our local revenues by what is in effect a heavy tax on houses. The payment of say half the rates on well-built and sanitary working-class dwellings out of the proceeds of government grants would give a much needed impetus to both municipal and private enterprise in this direction.

Meanwhile the Labour men on municipal bodies should make the fullest use of such powers as they already possess and push forward vigorously with their campaign of municipal socialism in such a manner that the workman may perceive its direct benefits. His Housing should be visibly cheaper and better, his trams visibly quicker, less expensive and more comfortable, his gas and water supply visibly improved on account of their transfer to a public body. At the same time of course the labour employed by the municipality in conducting these industries should receive what we may call (to borrow a phrase from diplomacy) "most favoured employe" treatment. It may be remarked that it is not desirable that municipal undertakings should aim at large profits. Theoretically this is indefensible for it means that the consumer pays more than his fair share of the rates; practically it is undesirable, since it tends to obscure the real benefits of municipal enterprise.

In national affairs the progress of definite socialism cannot perhaps be so rapid. But the Labour party might well press for the nationalisation of mines, especially of coal fields (already demanded by the Trade Union Congress), the state regulation and ultimate nationalisation of railways, canals and other means of transit, and should insist on government departments doing their own work wherever possible and paying not less than the standard rate of wages.*

But legislation of this kind has only an indirect effect upon the real problem that confronts the people of this country, the people of all countries which have developed along the lines of industrial civilisation. With the appalling evidences of physical degeneration confronting us, we cannot, whether we are Socialists or Labourites or only decently humane and patriotic Englishmen, do without a social policy. In the last resort, all progress, all empire, all efficiency depends upon the kind of race we breed. If we are breeding the people badly neither the most perfect constitution nor the most skilful diplomacy will save us from shipwreck.

What are we to do with the great masses of unskilled, unorganised labour in our big towns? That is the question which intelligent thinkers are now asking themselves; and, as Carlyle said "England will answer it, or on the whole England will perish." We have drained our country side and destroyed our agriculture to a great extent deliberately in order to obtain this vast city proletariat. Its condition is appalling; it is starved at school, over-worked when it is just growing into manhood, and afterwards drifts into the ghastly back-waters of our towns, now sweated, now unemployed, always an open sore, a contamination, a menace to our national life. That is what fifty years of applied Liberalism have made of about a third of the English people.

Well, the first thing we must do is to try to save the next generation if we cannot save this one. The child at any rate must be protected. One of the first and most urgent of the social re- forms needed is the feeding of children in public elementary schools. To teach unfed or underfed children is a sheer piece of profitless brutality. Compulsory and free feeding is as necessary to us as compulsory and free teaching more necessary in fact for more could in the long run be made of an ignorant people that was fit and healthy physically than of a race of white-faced cripples, whom society had crammed with book- learning to satisfy its theories as barbarously as it crams geese with food to satisfy its palate We are entitled therefore to demand the free feeding of all children attending Public Elementary Schools. Of course all sorts of less drastic proposals will be made proposals for feeding destitute children only, or for making a charge, or for recovering the cost of the meals from the parents. Some of these proposals will be better than others, and we must take the best we can get. But none of them will solve the problem. Nor will the problem be solved by any merely permissive legislation, giving local authorities the power to feed children without compelling them to use it. A local authority has no more right to underfeed its children than a parent has. All local authorities must be held responsible for the proper feeding of school children with their areas of administration, as they are already held responsible for their proper instruction.

At the same time another policy might be adopted the results of which would indirectly be of perhaps still greater value. I suggest that while these experiments are proceeding there should be a periodical physical examination of all the children in the elementary schools by duly authorised medical officers. This would be a good test of the success of the new feeding policy and might form the basis for an extension of the principle of grants in aid to encourage those municipalities which were most zealous in looking after the physical well-being of the children. But its usefulness would not end there; it would provide us with what we most want a really reliable collection of socialogical data upon which future reforms could be based.

But when the child leaves school the need of protection by no means ceases. Our factory code already recognises that the setting of children to hard commercial work before their minds and bodies have had time to develope is as wasteful (from a national point of view) as it is inhuman. But the application of the principle is still half-hearted. Children over eleven can in some parts of the Kingdom be employed in factories provided that they put in one school attendance per day; the age at which even this provision ceases to operate is fourteen, after which the children are held to become "young persons," and may work sixty hours or more per week. This is clearly very little security for the physical and moral development of the race. No child should, under any circumstances whatever, be allowed to work for wages until he or she is say fourteen. From fourteen to twenty the "half-time" arrangement might be made to apply, and, as has already been suggested, we could use the time so gained in order to give the young people effective technical, and, in their latter years, also military training, thereby immensely improving their physique and at the same time forming a national reserve of almost invincible strength.

But after all most social problems come back in the end to the wages problem. If the workers received better wages many of the questions which now perplex us would solve themselves. And here we are brought directly to what Mr. Sidney Webb has called "the policy of the National Minimum." The principle of the national minimum has been long ago embodied in legislation, and is in reality the root idea of factory acts, public health acts, restrictions on over-crowding and most other social reforms of the last century. But its possibilities are by no means exhausted. We must develop it further along the same lines until it gives us what we most want, a statutary minimum wage for labour. This has been partially established in a few of the most prosperous of our staple industries by the development of Trade Unionism. Its much needed application to the unskilled trades where the rankest sweating abounds can only be made possible by the exertion of state authority. To those who are soaked in the Liberal tradition of "free contract" of course the legal minimum wage will seem a piece of odious tyranny, but there is, as it seems to me, no essential difference between the fixing of maximum hours by law and the fixing of minimum wages. It is at least as important to the community that its citizens should not be underpaid as that they should not be overworked.

The Trade Unions to which we owe nearly all that betterment of the condition of the workers which Liberals absurdly attribute to Free Trade, cannot possibly be allowed to remain in the impossible position in which recent legal decisions have placed them. But that is no reason for agitating for what is called the status quo ante, which is neither practicable nor desirable. The sound demand is that the law should be made clear; that it should put single employees and combinations of workmen on an equal footing; that legal disabilities of Trade Unions should be removed; and that the liability of Trade Unions should be definitely confined to those authorised acts of its servants or agents for which a corporate body may fairly be held responsible. This on the face of it is reasonable, and should be applicable to employers' associations also, so that when the time comes for the enactment of a Compulsory Arbitration Law (as in Australia) that is when the trade unionists themselves recognise the desirability of such a measure, the machinery for its execution will be available.

Then there is the perennial and apparently impenetrable problem of the Unemployed. This is one of the problems which in all probability cannot be finally solved except by a complete reorganization of society. But, wisely handled, it can be palliated and reduced to more manageable proportions. In discussing this question a distinction must always be made between the temporary unemployment to which all workmen are liable, and the permanent or chronic unemployment of the great masses of the unfit which our social system is always throwing off. These poor wretches are no more to be blamed for their idleness and worthlessness (from the social standpoint) than the rich shareholder is to be blamed for his. But their presence unquestionably complicates the problem and their treatment must inevitably be different. The first thing to do is to get at the facts. For this purpose there should be a Labour Bureau in connection with every considerable local authority which should keep a record of the state of the labour market from time to time. These bureaus should be in constant communication with a Department of Labour at Westminster, which is one of the most pressing needs of the hour. As to relief works, Mr. Long's farm colonies are good so far as they go; schemes for re-afforestation and the reclamation of fore-shores are perhaps even better. But it is well to keep in mind that the great aim of all social reformers should be to eliminate the "unemployable" class altogether. Mr. Webb's "national minimum" policy if carried out in all its branches would practically do this. The question of employment is closely connected with the whole question of our Poor Law, which badly wants re-modelling. Such a process should include the abolition of the Poor Law Guardians (the last relic of the ad hoc principle and a far more indefensible one than the School Boards) and the transfer of their powers to the local authority best fitted to deal with them, probably the County and Borough Councils. It should also of course include the establishment of universal Old Age Pensions, a measure whose popularity is as manifest as its justice, as was proved in 1895, when it contributed enormously to swell the Tory majority. The fact is that our present Poor Law was the first product of middle class Liberalism, flushed with its stupendous victory of 1832. It is founded unmistakeably on the principles of that creed, which, believing in the eternal justice of "economic harmonies," regarded the fact of a poor man being out of work as convincing proof of his worthlessness and criminality. It is as impossible for us, as the old Poor Law was for them.

Less obvious but not less certain is the connection between all these problems and the decline of our agriculture. It is the decline of agriculture which has driven into the towns the masses of unskilled labour with which we have to deal. Indeed the Liberals foresaw and deliberately planned this, when, first by the Poor Law and afterwards by the Repeal of the Corn Laws, they drove labour off the land in order to obtain it cheaply in the great industrial centres. And that is how the situation has worked out, so that it is important, no less in the interest of the town proletariat than in that of the country, that we should re-organise the first and most necessary of our staple industries. The idea apparently entertained in some Liberal circles that this can be done by the taxation of land values is, as Mr. Brougham Villiers has pointed out in "The Opportunity of Liberalism" (not altogether I should suppose to the gratification of his Liberal friends), on the face of it absurd. The end at which we are aiming is not that the state should own the ground rents but that it should own the land and the capital used to develop it, and it is to- wards this end that our policy should be directed. To this end we want an energetic system of state aid to farmers such as that already inaugurated by Sir Horace Plunkett and others in Ireland. We want loans to farmers on state security and experiments in cooperative farming under state supervision and with state encouragement; we want increased powers for local authorities in rural districts to buy and develop land; above all we want light railways, cheap and rapid transit, an agricultural parcels post (as proposed by Mr. Rider Haggard); and finally we want an end put to the monstrous system whereby Railway Companies charge higher rates to British than to foreign producers. When this policy has been fairly tried we shall see whether we also want a protective tariff. We do not want a tariff which will merely raise the landlord's rent, but, as I have already pointed out, Socialists have no theoretic bias against such a tariff if it can be shown to be necessary to the public interest.

But there is one question to which Socialists ought to devote a great deal more attention than they show any signs of devoting at present. Lord Randolph Churchill, the ablest and most far-sighted of modern party leaders, saw its importance twenty years ago, and put it in the fore-front of his programme. That question is the reform of government departments. Until this is honestly faced and dealt with, the Individualist will always have a powerful controversial weapon against Socialist propaganda. When the Socialist demands that the state shall undertake more duties, his opponent has only to point to the duties it has already undertaken and ask if he wants any more duties performed like that! A national system of transit run as the War Office is run would hardly be an unqualified blessing and would probably produce a reaction of the most damaging kind. The only answer is to reform the government departments and make them workmanlike and efficient bodies. Until this is done we shall be checked at every point every time we want a measure involving state ownership carried. Moreover we shall find it impossible to give effect to our policy of state regulation. The War Office has on the whole been most unfairly treated in being gibbetted as the supreme type of red tape and inefficiency. In neither respect is it really worse than most other branches of our administration not so bad for example as the Local Government Board, which is so hopelessly understaffed and so miserably ineffective that it is obliged from mere instinct of self-preservation to oppose every forward movement in municipal politics lest it should be over- burdened still further. It matters little who is its representative in the Cabinet. It is the Board itself and not its President for the time being that obstructs progress. Yet an efficient Local Government Board, encouraging progressive local bodies and harrying up backward ones, is an essential part of the "national minimum" policy. From every point of view therefore it is essential that our departments of state should be put on a new and better footing. A businesslike Home Office and a businesslike Local Government Board would do more for social reform than many acts of Parliament.

* The Labour Party might also take up the question of the development of Crown Lands (especially those containing minerals), to which Mr. Sheridan Jones has lately been drawing public attention.

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