III. SOCIALISM

473. Origin of socialism. The conditions that gave rise to the modern theory of socialism are described as follows by a brilliant French writer:

In the nineteenth century there has been a complete revolution in the organization of labor. In the eighteenth century there were as yet few large cities and almost no great factories. The regulations of the trades did not permit an employer to have more than three or four workmen. These journeymen, as they were called, worked in the shop with their employer, as the artisans in our small towns still do; after a few years they themselves became employers.

In our day the great industry has been created. In order to utilize the power of machines, a great number of workmen are gathered in the same factory; in order to furnish fuel to those machines, mines have been opened which give work to thousands of men. The absolute liberty of industry, established at the demand of the economists, has permitted the proprietors of factories and mines to employ hundreds of workmen in their service by simply pledging them a certain sum per day. Then began the separation of the manufacturers, who possessed capital, and the workmen, who rented out their labor for a certain wage. This was called the conflict of capital and wages. . . . The manufacturers form a part of the upper classes, the wage earners find themselves in a condition unknown before the nineteenth century. They live in the town where their factory is situated, but nothing holds them there. If the factory should have no need of them, they hope to find a better place elsewhere; they will go to the other end of the land in order to find work in another town. Therefore, they have no fixed habitation. They live like nomads, ever ready to depart. They possess nothing, having only their wages to live on. The wages depend on the labor, and there is no guarantee that they will always have labor, for their employer engages them by the day or week, and does not agree to keep them beyond that time.

Thus, beside the peasant and artisan classes already established, there arose a new class formed of workers in factories and of miners. To this body was given the old Roman name proletariat (those whose only wealth is in their children). . . . The members of the modern proletariat are assuredly better fed, better lodged, and the object of less scorn than were the common people of the Middle Ages. However, they are much more discontented. They are not comfortable because they have no abiding place, and cannot count upon the future. At the

same time, since society has become so democratic, they hear continually that all men are equal before the law, and that they have the same political rights as the wealthy class. They have ceased to be resigned to their fate, and have set about demanding a change in conditions.

The economists of the eighteenth century taught that poverty is the result of natural laws, and that it is inevitable. . . . In the nineteenth century some theorists appeared who argued from a contrary principle. They said that poverty comes from the unequal division of wealth some have too much, others too little; society is badly organized, the state ought to make it over in such a way as to diminish this inequality. A social revolution is necessary. These partisans of revolution were called Socialists, and their doctrine was denominated socialism. The Socialists all agree in attacking our system of property ownership, and demand the intervention of the state for the purpose of establishing another system. But they do not agree on what ought to take the place of the one now existing. Therefore, they cannot form one school.

474. Development of socialism. A leading American socialist outlines the various phases through which the movement has passed.

In its first phases, socialism was a humanitarian rather than a political movement. The early socialists did not analyze the new system of production and did not penetrate into its historical significance or tendencies. The evils of that system appeared to them as arbitrary deviations from the "eternal principles " of "natural law," justice, and reason, and the social system itself as a clumsy and malicious contrivance of the dominant powers in society.

True to their theory that social systems are made and unmade by the deliberate acts of men, they usually invented a more or less fantastic scheme of social organization supposed to be free from the abuses of modern civilization, and invited humanity at large to adopt it.

The scheme was, as a rule, unfolded by its author by means of a description of a fictitious country with a mode of life and form of government to suit his own ideas of justice and reason, and the favorite form of the description was the novel. The happy country thus described was the Utopia, hence the designation of the author as " utopian."

That these theories should have frequently led in practice to the organization of communistic societies as a social experiment, was but natural and logical.

The utopian socialists knew of no reason why their plans of social organization should not work in a more limited sphere just as satisfactorily as on a national scale, and they fondly hoped that they would

gradually convert the entire world to their system by a practical demonstration of its feasibility and benefits in a miniature society.

Utopian socialism was quite in accord with the idealistic philosophy of the French Encyclopedists, and lasted as long as that philosophy retained its sway.

The middle of the last century, however, witnessed a great change in all domains of human thought; speculation gave way to research, and positivism invaded all fields of science, ruthlessly destroying old idealisms and radically revolutionizing former views and methods.

At the same time the mysteries and intricacies of the capitalist system of production were gradually unfolding themselves, and the adepts of the young social science began to feel that their theories and systems required a thorough revision.

This great task was accomplished toward the end of the forties of the last century chiefly through the efforts of Karl Marx, the founder of modern socialism. Marx did for sociology what Darwin did later for biology; he took it out from the domain of vague speculation and placed it on the more solid basis of analysis.

The social theories of Karl Marx and the movement based on them are styled Modern or Scientific socialism in contradistinction to Utopian socialism.

Modern socialism proceeds from the theory that the social and political structure of society at any given time and place is not the result of the free and arbitrary choice of men, but the legitimate outcome of a definite process of historical development, and that the underlying foundation of such structure is at all times the economic basis upon which society is organized.

As a logical sequence from these premises, it follows that a form of society will not be changed at any given time unless the economic development has made it ripe for the change, and that the future of human society must be looked for, not in the ingenious schemes or inventions of any social philosopher, but in the tendencies of the economic development.

Contemporary socialism thus differs from the early utopian phase of the movement in all substantial points. It does not base its hopes on the good will or intelligence of men, but on the modern tendency toward socialization of the industries. It does not offer a fantastic scheme of a perfect social structure, but advances a realistic theory of gradual social progress. It does not address its appeals to humanity at large, but confines itself principally to the working class, as the class primarily interested in the impending social change. It does not experiment in miniature social communities, but directs its efforts toward the industrial

and political organization of the working class, so as to enable that class to assume the control of the economic and political affairs of society when the time will be ripe for the change.

475. The elements of socialism. The following may be considered the essential points in socialistic theory :

Socialism, when analyzed, is found to embrace four main elements. The first of these is the common ownership of the material instruments of production. . .

Attention must be called, also, to the statement that it is the material instruments of production which are to be owned in common, and not all wealth. That wealth which is not designed for further production can still remain private property under socialism. This means wealth used for enjoyment rather than for production. . .

The second element in socialism is the common management of production. Not only are the material instruments of production to be owned in common, but they are to be managed by the collectivity, in order that to the people as a whole may accrue all the benefits of management; that is, all those gains of enterprise called profits, as distinguished from interest, and in order that the management may be conducted in accordance with the public need, rather than in accordance with the advantage of private captains of industry. . . .

The third element is the distribution of income by the common authority; that is, the income of society, or the national dividend, as it is frequently called and it is that part of the wealth produced by society which may be used for enjoyment, after the material instruments of production have been maintained and suitably improved and extended. .

The fourth element in socialism is private property in the larger proportion of income. It thus becomes at once apparent that modern socialism does not propose to abolish private property. Quite the contrary. Socialism maintains that private property is necessary for personal freedom and the full development of our faculties. The advantages of private property are claimed by the advocates of the existing social order as arguments for its maintenance; but socialism asserts that society, as at present constituted, is unable to secure to each one the private property which he requires. Socialism proposes to extend the institution of private property in such manner as to secure to each individual in society property in an annual income, which shall be, so far as practicable, sufficient to satisfy all rational wants. . .

The results of the analysis of socialism may be brought together in a definition which would read somewhat as follows: Socialism is that contemplated system of industrial society which proposes the abolition of private

property in the great material instruments of production, and the substitution therefor of collective property; and advocates the collective management of production, together with the distribution of social income by society, and private property in the larger proportion of this social income.

476. The strength of socialism. The principal arguments advanced in favor of the socialistic state are the following:

Under the present system of economic organization, the laboring man does not receive the fruits of his toil. A large part goes to reward capital or to pay for the services of those who direct and supervise the employment of labor, or to speculators and middlemen, and too little to those who are the real producers. In short, society under the present system is organized in the interests of the rich and leads to grave inequalities of wealth and of opportunity. . . . The state should therefore take control of all the land and capital or means of production now being used for the exclusive benefit of the owning class. Under the individualistic régime industrial competition has become so fierce that the industrially weak have no chance of success and cannot survive in competition with the rich; they are growing relatively poorer and becoming more dependent upon the employing class, while the rich are growing richer and becoming more independent. The theory of socialism, it is argued, is founded on principles of justice and right. The land and the mineral wealth contained therein should belong equally to all, not to a few. . . .

Competition under the present system not only leads to injustice and the crushing out of the small competitor, but it involves enormous economic waste and extravagance in the duplication of services. The system of unrestricted competition leads to lower wages, overproduction, cheap goods, and unemployed workers. The only remedy for such a condition, say the socialists, is the abolition of competition and the substitution. of the coöperative principle, under which equality of opportunity and equality of reward and economy of production will be secured. Under the socialistic régime, it is asserted, a higher type of individual character will also be produced and a larger degree of real freedom. Such industrial competition as we have to-day tends to beget materialism, unfairness, dishonesty, and a general lowering of the standard of individual character. Man needs, therefore, to be guided and aided by the state and protected against his own inherent frailties.

The doctrine of socialism, moreover, is really in harmony with the organic theory of the nature of the state, which teaches that society is an organism, not a mere aggregation of individuals, that the good of all is paramount to that of a few, and that in order to secure the good of