Twentieth Century Socialism Part 14

The argument of this book, therefore, is not to abandon trade unions, but, on the contrary, to appeal to the unorganized employee to join the trade union in order to strengthen it industrially; and on the other hand to appeal to all employees, organized or unorganized, to combine politically for the purpose of securing by franchise what they never can accomplish by the strike.

The moral then to be drawn from the following pages is not that trade unions have come to an end of their usefulness, but that whereas their task in the past has been to check exploitation, their role in the future will be to put an end to it altogether.

-- 3. THE UNSOLVED AND INSOLUBLE PROBLEMS OF TRADE UNIONISM

John Mitch.e.l.l in his book "Organized Labor" has very properly stated that "the ideal of Trade Unionism is to combine in one organization _all_ the men employed, or capable of being employed, at a given trade, and to demand and secure for each and _all_ of them a definite minimum standard of wages, hours and conditions of work;"[85] and the principle of Trade Unionism is also well described as "the _absolute and complete prohibition_ of contracts between employers and individual men."[86] In other words, the object of the Trade Union is to put an end to compet.i.tion between employees in order to subst.i.tute what is called "collective bargaining," which, if complete, would put the employer at the mercy of the employee, for individual bargaining, which on the contrary puts the employee at the mercy of the employer.

The above is stated in other words in the Report of the Industrial Commission:[87]

"The union is conceived as a means of bettering the condition of its members by united action. If this action is to be thoroughly effective, it must be taken by or on behalf of _all the members of the craft_. It is by the establishment of an _absolute monopoly of labor power_ and to ameliorate the conditions under which it is sold and used."

Now the inherent and necessary defect of trade unionism under the compet.i.tive system is to be found in the words I have italicized in the above extract. If the trade union could be a "real monopoly of labor," it could dictate terms to the employer; but it must not be forgotten that, with the employer, it would remain subject to the conditions created by the market. The very fact, however, that all relations between labor and capital are determined by the conditions of the market makes it impossible and will always make it impossible for the trade union to attain its ideal; that is to say, to const.i.tute an absolute monopoly of labor power, to bind in one organization _all_ the men employed, to secure the absolute and complete prohibition of contracts between employers and individual men, to demand and secure for each and _all_ of them a definite minimum standard of labor, wages, and conditions of work. This is the crux of the whole question.

It has taken over a century of organization on the part of the employer and employee, of conflict between the two, of bankruptcy for the employer and of misery for the employee, to demonstrate that the ideal of trade unionism has not been and can never, so long as the compet.i.tive system persists, be attained. The trade unionist will answer that even though it be impossible to attain the ideal, trade unions have accomplished much and can accomplish more for the wage-earning cla.s.s. To this it may be fairly answered that whatever trade unions have in fact accomplished has been accomplished only at a ruinous price--that the price they must continue to pay for this accomplishment will continue to be ruinous and insufferable until either by the revolt of the discontented as predicted by Karl Marx, or by the awakening conscience of the whole community, as has already to a limited degree taken place, the betterment aimed at by the trade unionist will be attained and maintained without the payment of the awful toll now exacted by the compet.i.tive system.

It is probable that both employers and employees, during a century's struggle, have failed to take proper account of the extent to which both were hampered by the exigencies of the market. The blindness of both to this fact was perhaps due to the expansion of trade both in England and America during most of the century; this expansion being due to the development of the country in the United States and, in England, to the conquests of new markets and colonies. So long as expansion continued, trade unionists could insist upon increasing wages out of increasing prices, and the success which attended trade unions in raising wages during a large part of the century, brought about a false idea that there was no limit to the extent to which trade unions could by organization increase their share in the profits of industry. Unfortunately, the era of expansion could not last forever, and it was not until the lockout of the engineers in 1898-1899 that the British trade unionists began to discover how narrow were the limits within which they could improve conditions.

Until 1897 the employees had on an average the best of it. In 1893 no less than 63 per cent of strikes were decided in favor of the employees. In 1896 again the proportion of working people involved in disputes settled in their favor was greater than in any of the previous years since 1892 with the exception of 1893; and it may be interesting to note that during this year there was a lower percentage of unemployed than during any year since 1890.[88] It is not surprising, therefore, that trade unionists were convinced that there was no limit to the extent to which they might increase their share in the profits of industry. In 1897, however, the condition of the steel industry in England became such that the employers could no longer comply with the exactions of the trade unionists. In 1895 American manufacturers for the first time attempted to export their steel to other lands,[89] and their exports grew to $121,913,548 in 1900 and to $183,982,182 in 1908.[90]

In the presence of American as well as German compet.i.tion, the pressure of the market was such that the employers felt they must either break the power of the union or go out of business. They therefore locked out the engineers in July, 1897, and the lockout lasted until January, 1898, when the union was obliged to abandon all its contentions. This lockout is the turning point in the history of trade unionism in England. Up to that time, the idea that workingmen could be induced to abandon the parties to which they belong in order to organize a party of their own was never seriously taken into consideration at their conventions, and resolutions in favor of Socialism were overwhelmingly voted down. But as soon as the power of the engineers--the strongest union in England--was broken in 1897 we find trade union conventions entertaining the idea of political organization and resolutions in favor of Socialism receiving careful consideration.

The history of trade unionism in America has not as yet resulted in any such definite climax as this; but what foreign compet.i.tion has compelled English employers to do a combination of employers in the Steel Trust has done for the steel workers in America. In other words, the trade union has to face one of two alternatives: either foreign compet.i.tion is bound ultimately to compel the employer to destroy the union; or in the absence of foreign compet.i.tion owing to a high protective tariff, a combination of employers will do for their own benefit what compet.i.tion compelled British employers to do as a condition of survival.

If we turn from the history to the nature of trade unions it will be seen that what has happened must have happened. As has been stated, all agree that the ideal of trade unionism is to unite all the workers in one trade so as to subst.i.tute collective bargaining for individual bargaining. Unfortunately by the very nature of things such a combination is impossible. It is impossible to read any work on trade unions, whether it emanates from the government, or from employers, or from employees, without being struck by the fact that trade unions seek to be comprehensive, to include all the members in the trade on the one hand, while on the other hand there is a perpetual pressure upon them to be exclusive. For example, we find locals charging heavy initiation fees of a character to keep out members, for instance the longsh.o.r.emen, the garment workers, gla.s.s workers; and it may be "stated as a general rule that when a union does succeed in establis.h.i.+ng a monopoly against employers it is exceedingly likely to go on, if it feels strong enough, to establish a monopoly against the employees."[91]

It is perfectly true that this tendency is frowned upon by the trade unionists at large; but the reason for this is that every union which tries to be exclusive cultivates a crop of non-unionists who const.i.tute a menace to the union.

A better ill.u.s.tration of the quandary in which unionists find themselves between the importance of being comprehensive in the one hand and the importance of being exclusive on the other, is found in their att.i.tude towards boy labor.

Modern conditions have made apprentices.h.i.+p practically obsolete, and yet many national organizations endeavor to maintain the practice with a view to preventing too great a supply of skilled workers in the trade. The limit generally fixed by national organizations is 1 to 10, though some, such as pressmen, trunk and bag workers, flint gla.s.s workers, allow 1 to 4. Lithographers allow 1 to 5.[92] "It is obvious," says the Report of the Industrial Commission, "that the chief motive which influences the unions in the shaping of their apprentices.h.i.+p rules is the desire to maintain their wages, by diminis.h.i.+ng compet.i.tion within the trades."[93]

It is true that many unions in controlling apprentices.h.i.+p are animated by a much higher purpose; that is to say, to provide that when a boy undertakes to learn a trade he shall have a chance to learn it.

John Mitch.e.l.l in his book[94] claims that the restriction of admission of apprentices in the United States is negligibly small, and yet deplores the fact that "the great ma.s.s of youths to-day receive little or no training in their particular trade as a result of the breakdown of the apprentices.h.i.+p system." In his opinion the solution to the problem is not to be found in apprentices.h.i.+p, but in industrial schools; yet he deplores the hostility of graduates of trade schools to trade unions, without apparently recognizing that this hostility is due to the hostility first evinced by unions to trade schools. But let us turn from conflicting opinions and look the facts in the face.

When a unionist approaches the age of forty years, he is confronted by the fact that he cannot rival in speed and efficiency the work of a young graduate of an industrial school. He looks forward to the time when his place will be taken by the graduate of the industrial school.

He is very naturally therefore hostile to the industrial school and the graduate of the industrial school is for the same reason hostile to him. And here we come to the real difficulty: When a trade union fails to include _all_ the members in the trade, it does _not_ succeed in eliminating compet.i.tion between workingmen. On the contrary, it begins by creating two hostile cla.s.ses of workingmen: Those within the union and those without--cla.s.ses which bitterly hate one another because they are both fighting for the same job. But they do more than this: They create compet.i.tion within the trade union because by insisting upon high wages and short hours they are making it impossible for the employer to utilize the service of any but the most efficient. John Mitch.e.l.l himself points this out. In resisting the charge that trade unions tend to level down, he says: "If there is a levelling at all in the trade union world, it is a levelling up and not a levelling down. The only levelling which the trade union does is _the elimination of men who are below a certain fixed standard of efficiency_."[95] He further expresses it in another pa.s.sage:[96]

"Trade unionism tends to improve workmen not only directly, through an increase in wages and a reduction in hours, but it attains the same end in an indirect manner. The general policy of trade unionism, as has been explained before, is the establishment of a minimum wage, safeguarding, as a rule, the right of the employer to discharge for proved inefficiency. The result of this is the gradual creation of a dead line of a standard of efficiency, to which all who work must attain. Where there is a minimum wage of four dollars a day, the workman can no longer choose to do only three dollars' worth of work and be paid accordingly, but he must earn four dollars, _or else cease from work_, at least in that particular trade, locality, or establishment. The consciousness that he may be employed for a varying wage permits many a man to give way to his natural idleness and carelessness, whereas the maintenance of a rigid standard causes a rapid and steady improvement. The minimum wage acts upon the workman, as the school examination upon the child. If a child falls, by however small a margin, below the standard set by the school, he fails of promotion, and the stimulus which is strong in the case of a school child is infinitely more intense in that of a worker with a family dependent upon him. The principle of the survival of the fittest through union regulations works out slowly and unevenly; nevertheless its general effect is towards a steady and continuous progress of workingmen to a permanently higher standard of efficiency."[97]

There is one point upon which the author is silent--yet it is the point which enormously interests the workingman at large: this is that while trade unionism guarantees high wages and short hours to the efficient, it throws out of the trade altogether those workingman who do not attain a high standard of efficiency or who, having attained it, fall back from it owing to overwork, sickness, or old age.

There is, therefore, a perpetual struggle going on in the trade unions, not only between members and non-members, but even amongst the members of the union itself, in view of the fact that diminished efficiency must eventually lead to the weeding out of the inefficient.

In periods of industrial depression such as we have just pa.s.sed through it is obvious that the most inefficient are the first to be dismissed, and being the most inefficient, they are the ones least able to find employment in other industries.

Under the t.i.tle of Unemployment, the extent of this evil has been pointed out; it must not be lost sight of; it reaches a population of a million at the best of times and of five millions at such times as these.

But the problem raised by the importance of comprehensiveness to prevent "scabbing" on the one hand and of exclusiveness to maintain wages on the other, is not confined to such details as initiation fees and apprentices.h.i.+p. It covers the whole question of the employment of boys, women, old men, and half-supported persons, and includes the "sweating" system.

The higher the wages exacted by trade unions the more employers are compelled to have recourse to cheap labor of women and children, and this labor is all the cheaper because the unionist himself contributes to the supply; for the unionist supports his wife and children, and the very fact of the support he gives them permits them to accept a lower rate of wages than if they were not supported. To understand the operation of this principle it must be borne in mind that rates of wages are determined, not by the wishes of the employee or even by the greed of the employer; they are determined by the market price.

Unionists are not the only persons who object to the labor of women and boys. There is indeed no divergency of opinion as to the unwisdom of working boys before their education is complete or their bodies matured; or the unwisdom of employing women, destined by Nature to perform other more important functions. No better witness to the control exercised by the market on this important subject can be found than a member of the English Ministry, the Right Honorable H.O.

Arnold-Forster, who says:

"The great cotton industry of Lancas.h.i.+re, the wool and worsted industry of Yorks.h.i.+re, and many other industries in a less degree are at the present time dependent upon child labor. It is interesting to observe that as lately as the autumn of 1907 a deputation waited upon the responsible minister to urge upon him the desirability of raising the age of half-timers from twelve to thirteen. The desirability of the change was not denied, _but it was not considered possible to give effect to it_.

"Those who have any acquaintance with the cotton trade are well aware that that great industry, employing as it does no less than half a million persons, is conducted upon the _most minute margins of profit and loss_. The rate book of the cotton trade, in which wages of every kind of work are calculated out to the tenth of a penny, is a miracle of painstaking and intelligent computation. These fine calculations are absolutely necessary. Both employers and employed know perfectly well that the trade is, so to speak, _balanced on a knife edge_, and that any sudden increase of cost, whatever may be its cause, is likely to upset the balance, and turn the hardly won profit out of which operators as well as employers obtain their living, into a loss. The _fierce compet.i.tion of the world_, especially of those countries in which child labor and long hours are prevalent, has to be met, and the persons princ.i.p.ally concerned are only too well aware of the fact."[98]

Nothing then is better established than that every employer is forced by the pressure of compet.i.tion to keep wages down, and that any employer who either under the compulsion of a trade union or out of generosity of heart attempts to raise wages one cent above the price permitted by the market, must expiate his mistake in the bankruptcy court.

There is only one way in which this compet.i.tion can be met--the way imagined by Karl Marx: a comprehensive organization of trade unions, not only within one nation, but amongst all nations; in other words, the famous--and at one time loudly proclaimed as the infamous--International.

The fact that the international plan of organization imagined by Karl Marx failed, is little argument against it. But the fact that trade unions do not succeed in securing all the members of a trade in any nation--that indeed in the United States organized labor includes at most 2,000,000 members, whereas the working population is over 20,000,000, ought to be a convincing argument that a comprehensive organization of workers all over the world is still less possible.

One word must be said in this connection about the sweating system and its relation to trade unions. It is a current statement that sweating is confined in America to a few industries, such as tobacco and garment making. This, however, is a great mistake. Sweating may be defined as the reduction of wages to starvation or even below starvation level. It is true that sweating in this country is in large part due to an ignorant, unorganized, and poverty-stricken cla.s.s of immigrants. But sweating is also to be found in a much higher order of employees. I refer to the sweating of certain factories and department stores where the rate of wages is determined, not by the cost of living, but by the price which half-supported women are willing to take for their week's work.

In many factories and in practically all the department stores the wages are below the sum necessary for a working woman to live; and they are made so at least in part by the fact that the daughters of well-to-do workingmen, being supported at home, are able and willing to give their time for a sum less than sufficient to support life. In some cases this work is rendered in a laudable desire to contribute to the common expense of the home. In many cases it must be attributed to vanity and the attractiveness of this kind of work.

We find, therefore, the workingman put in this singular position: Through his trade union he secures a high rate of wages; with this high rate of wages he seeks to establish a decent home; the desire of a decent home permeates the entire family; the daughters want to contribute thereto and, because they are partially supported themselves by the high wages received by the father, they accept a rate of wages so low that their less fortunate sisters are doomed to starve.

So on every side the trade unionist is hoist by his own petard. The high wage he is in a position to exact is perpetually menaced by the compet.i.tion of the women and children of his own family whom his own high wages put in a position to compete with him. These high wages throw out of employment all save those of the highest efficiency, and by permitting the half-supported members of his family to work for low wages, reduce others who are not half supported below the level of starvation.

I shall not insist on other problems which still divide the members of trade unions, such as what is called "right of trade," or "the conflict between industrial and craft organization," both of which occasion loss of employment and division in the ranks of labor, because these are not insoluble. It is true that they have not yet been solved, but there is nothing in their very nature that makes a solution impossible. I do, however, insist upon the problems above referred to, because they are not only unsolved, but by their very nature can never be solved. No trade union can ever include _all_ the men of the trade, because _all_ cannot earn the high standard of wages set by the union; because the trade never can give employment to all the men in the trade--at the best of times there are over 3 per cent unemployed; because by insisting on a high rate for unionists, they compel the employer to have recourse to the cheaper labor of women and boys; because the very sense of family responsibility which makes a unionist support his wife and children is exploited by the employer to secure the services of these last at half wages; because the existence of a half-supported population creates and maintains sweated trades; because the employers, were they Angels of Mercy, cannot, thanks to the pressure of the market, raise wages or dispense with the cheap labor of women and boys without either incurring bankruptcy or shutting down; because either contingency would deprive the unionist of work and therefore of wages; because both employer and employee are perpetually being chased round a vicious circle by the devil of compet.i.tion which, by keeping down prices and wages, keeps both in danger of ruin and unemployment.

The conclusion to which we are driven seems to be that the compet.i.tive system has the same effect upon trade unions as upon the rest of the industrial field--it sacrifices the many to the few. During these last two years wages have not been appreciably reduced. The most efficient have continued to receive the same wages as before. But the price paid for this advantage has been the reduction of between five and twenty millions of people to the verge of starvation, a large part of whom must by the very necessity of things be driven to vagrancy and through vagrancy to crime.[99]

What Socialism proposes is to maintain the principle of compet.i.tion to the extent necessary to a.s.sure most comfort to the most efficient without exposing the rest to so awful an alternative as unemployment.

And I think it will be seen that the education of the workingman through the organization, the order, the democracy of trade unions will play no small part in making Socialism possible, and that it is probably through the organization of trade unions that a true democracy will eventually be attained.

-- 4. TRUSTS

Two pictures of trusts have already been borrowed in this book,[100]

one by Mr. Rockefeller, showing the economies they make, and the other by Mr. Havemeyer, showing the dangers that attend them. Trade unions start out to include all the men in the industry; this is their ideal; and it has been shown how far short of it they fall. It is generally supposed that trusts likewise seek to include all employers in the industry, but this is a great mistake. Not only does the law forbid this, but it would be a mistaken policy. A trust that included all the industry would invite newcomers for blackmailing purposes if for no other. The last and best policy of the promoter is to include only the most prosperous and to leave around the trust a fringe of independents too weak to affect prices but just strong enough to live as a warning to others. A good collection of independent factories on the verge of bankruptcy is the finest bulwark a trust can have, for they discourage the starting of any more.

How the trusts make prices and keep independents in their wake is well ill.u.s.trated by the following extract:[101] "The custom has regularly been for some years for the Standard Oil Company to announce from day to day the price which it would pay for crude petroleum and the price at which it would sell refined petroleum. This price is generally accepted as the market price, and compet.i.tors follow."

"Likewise, the American Sugar Refining Company first posts the prices for the day, and is then followed by its compet.i.tors, who post theirs.

Generally they take the prices fixed by the American Sugar Refining Company; but at times, if they have a little surplus stock on hand, or if it is difficult for them to secure a customer, they will cut the price perhaps one-sixteenth of a cent per pound. One or two of the chief compet.i.tors seem to be forced to put their prices quite frequently at one-sixteenth of a cent below that of the American Sugar Refining Company. In spite of its control over the output it is said by Mr. Post that the American Sugar Refining Company has not, in his judgment, unduly restricted the output. It is probable, he thinks, that had that company not been formed the compet.i.tive system would have ruined many established refineries, so that as many would have been closed as is now the case, and the output would have been fully as small, probably even less. Practically all of the witnesses, both members of the combination and their opponents, concede that while there is a certain arbitrariness in fixing the prices it has been exercised in most cases only within comparatively narrow limits, and then, mainly to meet compet.i.tion or stifle it."

Trusts, therefore, do in one sense succeed where trade unions fail; that is to say, they do succeed in getting all to join them that they want; whereas the trade unions do not, the essential difference between the two being that the trust is essentially monopolistic whereas the trade union is essentially democratic. The one wants to benefit a few at the expense of the many; the other wants to benefit all at the expense of none. As the compet.i.tive system favors the policy of the trust and disfavors that of the union, the trust succeeds where the union fails.

No one would accuse the organizers of a union of seeking to benefit a few at the expense of the many, and yet this under the compet.i.tive system is not only what happens but what must happen. On the other hand, no one imagines that the organizers of a trust have any other intention: they deliberately set out to eliminate compet.i.tors for their own benefit and they have succeeded in their task to an altogether unexpected degree.

It has been claimed, however, for the trusts that whatever may be the private benefit of their stockholders, they do perform a great public service.

Among the public services they were supposed to render it was claimed that they would pay good wages and furnish steady employment.[102]

Even the labor unions themselves were of this opinion. Their leaders testified that they did not fear industrial combination and that if combinations were able by virtue of their savings to increase the profits of industry, workingmen would be able by pressure to "maintain or increase their wages quite as readily as before the combinations were made."[103] Another contention made for trusts was that they would lower prices. With the view of maintaining this contention, the trust magnates themselves testified to the enormous economies effected by combination, for the purpose of persuading us that the consumers would profit by these economies. Mr. Havemeyer was honest enough, however, to admit that he would be guided in fixing the price only by business considerations. But it was believed at that time that business considerations would be sufficient to keep prices down and the experience of the Whisky Trust was cited to prove that it was impossible to maintain prices above a reasonable margin of profit.

The Whisky Trust was organized in 1887 and after having lowered prices for the purpose of eliminating compet.i.tors, it brought the prices up to as high a level as had ever been reached before. The result of this was that at the end of 1888 prices fell, owing to a reorganization of the trust and to a subsequent raising of prices by the trust in 1891, only to be followed by a corresponding fall in 1892. And so prices went on reaching a very high level at the close of 1892, only to fall back to a low level in 1893; and again to a high level in 1894, only to go down so low in 1895 as to put the trust into the hands of a receiver. By this time the Whisky Trust had learned its lesson; it learned that if it endeavored to put the price of whisky up to an undue height, new distilleries were started to profit by these high prices, and the only way of avoiding bankruptcy was to maintain the price just high enough to return profits to the trust, but not high enough to encourage outside compet.i.tion.