CHAPTER IX
The Industrial System of the New Order

THAT new order of things which has been coming to a head since the close of the century is especially plain to be seen in the conduct of business. Business runs on something of a new footing. But it is a new order of material conditions that has enabled this new dispensation in business to come on and go into action. It runs on an altered state of the industrial arts, coupled with a continual growth of population. And the new dispensation in business has arisen out of the endeavours of the business men to profit by the enlarged opportunities which these altered material conditions have offered them. It has been their work to turn the new industrial situation to account for their own gain while working under rules of the game of business that have come down from the old order.

This has involved a progressive change. It has taken time and experiment as well as the help of legal counsel to discover and work out suitable expedients of business procedure and to get into the habit of them. At the same time the underlying industrial situation has been subject to a continued, cumulative, alteration ; an advance in mass and extension, in the scale and range of operations, as well as in the complexity, balance, and precision of details. Therefore the new order of business procedure has gone into action in a progressive and tentative fashion. And for the same reason it has never reached the end of its development; nor, indeed, is there any promise of its reaching anything like a final state of stability and finished growth in the calculable future; for the reason that the state of the industrial arts which underlies it is forever unstable. And just now the industrial arts are in a state of unexampled instability. And the business men who aim to benefit by the use and control of these industrial arts will have to take them as they come, and it is the habitual procedure of these business men that determines what the methods and organization of business will be.

There is little that can be said in the way of confident forecast as touches the future of the industrial arts or as regards any final outcome of this continued advance in technology and in the consequent sweep and scale and articulation of the industrial system; and the business community will have to face these new exigencies as they arise. Yet in one respect, at least, the course of things in the recent past may be taken to indicate the nature of the situation which the business management will have to deal with as time goes on. As it stands now the industrial system is inordinarily productive. Its productive capacity per unit of the factors engaged—the coefficient of productive capacity—has in recent times continually been increasing at a continually accelerated rate, and the situation holds a clear promise of a still more inordinate productive capacity in the course of further time and change. The technicians are forever occupied with contriving new ways and means designed to compass that end.¹

In so speaking of a “New Order of Things” there is no intention to imply that the new is divided from the old by a catastrophic break of continuity. To use a geologic figure of speech, there has been no faulting of the strata. No sudden thrust has upset the orderly advance of technological knowledge and practice. There has been an orderly cumulative advance which has gone forward without serious interruption and at a constantly increasing rate of advance. It is an instance of cumulative growth, which has now passed a critical point of such a nature as to give rise to a new situation which differs effectually from what went before.

In the case of America this cumulative growth of the industrial arts and of the industrial system has been particularly notable since about the middle of the nineteenth century. Coupled with this advancing industrial situation and conditioned upon it, there has at the same time gone forward a sweeping progressive reorganisation of the business community, which has placed the country’s business affairs on a footing of credit and corporate ownership. With the result that toward the close of the century the financial community, who command the country’s solvency and dispense the country’s credit, found themselves in a position to take over the control and the usufruct of the country’s industrial system by taking over the ownership of those strategically dominant members of the industrial system that are known as the “Key Industries.” Since then the key industries have been progressively taken over into the absentee ownership of the country’s credit institutions, and this absentee ownership has progressively been consolidated and arranged in manageable shape. The arrangement has now been brought to a passable degree of balance and stability, although the work has not been brought to a neatly finished conclusion; nor need it be. Nor is there any present likelihood that this working arrangement will be rounded out into a statistically all-inclusive block of absentee ownership in the hands of a formally consolidated going concern of investment-bankers.

Irrepressible new technological advances are forever running out new ramifications of industry, which are forever requiring further attention at the hands of these captains of ownership. So that the work of taking things over is an endless task, at the same time that something less than universal ownership will serve the purpose quite handsomely. All that is needed for the purpose of an effectual usufruct of the country’s work and output is a strategically effectual control of the country’s industrial system as a going concern, and that much is now an accomplished fact. The several branches and strata of the industrial system overlap and interlock in such a way as to vest a strategically effectual control of the whole in the hands of those who command the standard natural resources and control the key industries. All that remains needful to be done is to bring the several absentee concerns who control the key industries to a settled and facile footing of collusion, and much has been accomplished along that line these last few years.

In America, as an outcome of the nineteenth century, the industrial work of the community has fallen into the shape of a three-fold division or stratification of industries which work together in a balanced whole, a moving equilibrium of interlocking processes of production: (a) the primary, initial, or key industries, so called, which command the greater natural resources of the country and turn out the prime staple necessaries of the mechanical industry in the way of power, transportation, fuel, and structural material; (b) the secondary or continuation industries, manufactures, which turn these crude supplies and services into consumable goods and distribute them; (c) agriculture.

This may seem a gratuitous and illogical classification, particularly as regards agriculture. It is quite evident, of course, that agriculture has to do with the greatest and most essential of the country’s natural resources, at the same time that it is the indispensable source of supply for a wide and varied range of staple industries. So it is as usual as it is unquestionably proper to class agriculture with the “extractive industries,” and not unusual to give it the first place in that class; and there is no fault to be found with that arrangement. The conventional scheme would be: (a) extractive industries; (b) manufactures; (c) distribution. Which would be a sound logical plan and classification of productive industry, in the absence of business considerations.

On the other hand the three-fold division which is spoken for above is drawn in view of those business considerations that are decisive for the conduct of industry here and now. It is not intended to violate or set aside the grouping of industries that has been usual in the theoretical speculation of the economists, but is made only for present convenience. What is aimed at is a convenient definition of the facts for the present argument, which has to do with the relations between business and industry in America in the twentieth century; and the three-fold division spoken for above answers this purpose. Each of these three industrial groups or strata occupies a peculiar place in the industrial system, in respect of ownership and business connections.. There are at the same time no sharp lines of division between the three groups. They overlap, interlock and blend; and each group will show doubtful and marginal cases; but in the large, as component factors in the framework of the industrial system, each group stands out by itself, typically distinct from the rest, particularly in respect of the business considerations by which each is bound or actuated.

At the same time it is also not to be overlooked that these three strata of productive industry are marked by characteristic differences on the technological side, as well as in respect of the business considerations that govern, them. They each stand on a somewhat special and distinctive footing in the industrial arts; all the while that they all move within the framework of the modern industrial system and are, each in its degree, dominated by that mechanical industry that gives its distinctive character to the system as a whole and as contrasted with what has gone before. But the three groups or departments of industry do not share alike or in the same degree in that characteristic shift to a mechanical footing that has resulted from the industrial revolution of the past one hundred and fifty years.

As it runs now, the industrial system centers in quantity production of goods and services by use of inanimate energies engaged in mechanical work, or engaged in chemical processes that are of a mechanical nature and effect. Typically, the standard processes of this modern industry engage inanimate forces and materials; or materials and forces which can effectually be applied on a mechanical plan. In this respect the current state of the industrial arts differs notably from its own past as well as from the industrial systems that still prevail among outlying and backward peoples,—backward, that is, in respect of the mechanical technology. In the main and typically, this state of the industrial arts is a technology of physics and chemistry; having to do with inanimate ways and means, and carrying on its most characteristic work by use of inorganic processes and materials.

But all the while it remains true, of course, that this mechanistic state of the industrial arts has come out of a past phase in which workmanship ran on another plan ; a past in which the industrial arts were dominated by a different range of conceptions. Through some ninety-nine per cent., at least, of this past period of experience and growth the industrial arts have been, in the main and typically, a technology of animate (human) energies, workmanlike manipulation, and organic processes of fecundity, growth and nurture; and there are many holdovers out of the organic technology of the past that still make up a very substantial part of the industrial system.

Agriculture, e. g., still rests on a body of such old-fashioned holdovers, much of it of unknown antiquity and out of touch with the logic of the mechanical industry. Yet in the main and as contrasted with what has gone before, and allowing for extensive holdovers, the industrial system that engages the civilised nations runs on a technology of physics and chemistry, and its work converges on quantity production of mechanically standardised goods and services. Therefore manufactures are the focus of the industrial system. It is a technology of manufacture, of mechanical standardisation and quantity production; and the same technical principles and procedures are all the while reaching out into the outlying fields of agriculture and back into the other extractive industries that have to do with the primary supply of power, fuel, and raw and structural materials.

As the case now stands the manufacturing industries are able and ready to meet all current needs of the market by the use of the existing equipment and man-power, and the technicians and workmen are ready at any time to extend, amplify and intensify the available equipment and industrial processes to take care of any new growth in the demand for goods. The manufacturing industries, where mechanical power and quantity production rule the case, are inordinately productive, in the sense that they are ready at any time to cover a demand for goods greatly in excess of their ordinary output.

It is one of the features of the current situation that there is always an available slack which can be taken up in case of need, a margin of unemployed equipment and man-power ready to go to work, and a fringe of technical knowledge which has not yet been turned to account but which is fit to speed up the quantity production of staple goods at any point where an additional output may be called for. In effect, the work and output of the manufacturing industries are not now limited by the productive capacity of their equipment, workmen, or technical processes. But they are subject to limitation on the one side by the available supply of power and materials, and on the other side by the market for their output; and the available supply of power and essential materials is limited, in the main and decisively, by the current output of the key industries which command the country’s staple resources ; which output in turn is limited by consideration of what the traffic will bear, at the hands of the absentee owners of the staple resources and their business agents. On both sides, therefore, the output of staple goods in the manufacturing industries is limited, not by productive capacity or by capacity for consumption, but by business considerations. And the business considerations which chiefly decide what the volume of output of manufactured goods shall be are the considerations which govern the key industries and their output of power, fuel, and raw and structural materials.

It follows that the manufacturing industries as a class are dependent immediately on the key industries and on the terms which the management of the key industries may choose to offer them, somewhat arbitrarily. From which it follows also that the manufacturers as a class necessarily conduct their enterprise on a short-term plan; governed by the visible supply and the orders outstanding; since the management of the sovereign key industries, like other business men, keep their own counsel as to what they will do about their own business,—when and how and how far they may see fit to alter the terms on which they are willing to supply the necessary materials of industry. So the manufacturers must hold themselves ready to slack off or to speed up, to widen or narrow the margin of unemployment, with a vigilant eye to the main chance and waiting watchfully for any adroit manoeuvres in the key industries.

So also it follows that the manufacturing industries as a class are on a competitive footing; competing for the available supply of power and primary materials, but more particularly competitors for custom in the market. This competition has been taking on a special character during the past two or three decades, not contemplated in the manuals of economic theory, and as it is in some degree a novel development due to a complication of circumstances and calling for detailed analysis, a fuller consideration of it will best be deferred to a later chapter.

The place and nature of the key industries in the industrial system scarcely require elaborate discussion here. They are such as the name, “key industries,” implies. And they are key industries because they command the main run of the country’s staple resources. Technologically the key industries come into the same class with manufactures, and some of the best work of applied chemistry and physics is to be found here ; as, e. g., in metallurgy and the refining of petroleum. But as business concerns the key industries stand in a special relation to the industrial system. They hold the initiative by virtue of their hold on the staple natural resources ; and by active collusion or by routine which has been settled on lines of collusion they have during the last few decades come to exercise a decisive control over the industrial system at large, so that the country’s industry will now speed up, slack off, or shut down, very much as the massive concerns in the background among these key industries may decide ; and their decision in these matters is, of course, guided not by consideration of serviceability to industry at large or to the livelihood of the underlying population but by pursuit of the largest obtainable net gain for themselves.

Of course, there is in this respect no difference in principle between the business management of the key industries and business-as-usual anywhere else. It is only that the business of the key industries is in a peculiarly fortunate position, such a position of virtual monopoly and free initiative as all business men in all lines of enterprise aim to achieve if they can. It should be added that this strangle-hold of the key industries upon the country’s industry at large has been gaining in breadth, rigor, and security, and that the present outlook is for further gains of the same nature.²

In practice there is no sharp line to be drawn between the key industries and the common run of manufactures. They all belong together within the lines of the machine industry, and the business interests which control them make no account of any technical distinction between the two groups of industrial enterprises. In coal, oil, steel, and transportation, e. g., the business concerns interested have been reaching out among the manufacturing industries which draw on them for service and materials, and have been acquiring an interest also in the business of distribution. And many manufacturing concerns have on occasion, for security and despatch, reached back among the key industries and secured a hold on some needed line of staple resources. As an illustrative instance, corporate interests whose business centres in the extraction, refining, and transportation of petroleum and its products have gone largely into merchandising business as distributors of their own output, wholesale and retail, and at the same time they are also to be found intimately interested in a business way in linseed oil and the manufacture of paints and pigments, as, e. g., white-lead, as well as in soaps, candles, unguents, medicines, and cosmetics. So also there are industrial business concerns that have to do with manufacturing and that would have to be classed as manufactures in the technological respect, at the same time that they occupy a strategical position of much the same character as the key industries. Such are, e. g., the meat-packers and the flour-millers; and there are other concerns interested in sugar, gas, electricity, telephones, trolley lines, and the like, that fall more or less patently in the same doubtful or ambiguous class.

Among all these, that group of business concerns of which the packers and millers are the type-form occupies a special position, peculiarly difficult to classify. On the formal face of things they are manufacturers, but in effect they command those natural resources from which their raw materials are drawn. In effect their command of the tributary agricultural resources is so unqualified that it will scarcely be an over-statement to say that they hold these natural resources of the farming region in usufruct, with power of use and abuse. It is also quite safe to say that this usufruct of the farm resources has been capitalised and included among the assets of these corporations so as to count in a substantial way in the current market value of their outstanding corporate securities. Of course it does not follow, nor need one entertain a suspicion, that the corporate interests in question have ever abused the power which their virtual monopoly of the country’s resources in meat and grain so vests in them. The point of interest here is rather that the cleavage between the key industries and the common run of manufactures is by no means neatly observed in business practice, although the technical distinction between the two is fairly obvious. The trail of the net gain will cross technological frontiers as readily as national frontiers.³

The third of these contrasted industrial groups, or strata, in the three-fold division spoken for above, the farm community, is more sharply set off from the rest of the industrial system, both technologically and in respect of the business relations by which it is governed. In both respects farming is on a footing different from the rest ; and the reason for its different business footing is its different technological character.

Outside of farming, the main body of the industrial system has undergone a revolutionary experience during the past one-hundred-fifty years. The industrial system at large, outside of farming, has been reshaped by the machine industry and that standardised quantity-production which the machine industry has brought into action. The industrial system at large is dominated by the technology of physics and chemistry; it is essentially a system of mechanical power, inanimate materials, and inorganic processes. On the other hand agriculture still rests on a body of industrial arts that are older than the Industrial Revolution,—older even than that handicraft system which the technology of physics and chemistry has been displacing. In farming, these mechanical appliances and applications of mechanical power are still “labor-saving devices,” and they still come into the case only as accessory ways and means which “facilitate and abridge” the manual operations of the husbandman. All these things have hitherto touched agriculture only in a superficial way. They do not make the output; they only help along in the manipulation and distribution of it.

The agriculture from which the civilised peoples draw their livelihood and on which civilised life depends is a system of “mixed farming” which does not differ, in its elements, from the mixed farming of neolithic Europe some ten or twelve thousand years ago. It is mixed farming. That is to say it makes use of a certain equipment of domestic animals and crop-plants ; and the equipment as well as the methods and purposes of it all are still, in their elements, the same as ruled the case in the husbandry of neolithic Europe. The industry still continues to turn out essentially the same output of grain, milk, butter, cheese, eggs, meat, wool, and hides; and it turns out these necessaries of civilised life by recourse to the same technology of breeding and nurture, fortified by a variety of mechanical helps.

But these mechanical helps and expedients do not make the output and “are not of the essence of this contract.” Farm produce is still an output of those processes of growth and nurture that date back for their technological character to the domestication of plants and animals in prehistoric times. And the mixed farming of the civilised nations still rests on the technological foundations that were laid for it when the crop-plants and domestic animals found their way into neolithic Europe. Improvements in methods and appliances have been many and various, but those improvements and advances that have cut at all deeply into the substance of husbandry have been advances in breeding and tillage; that is to say, they have continued the work of domestication which the neolithic husbandmen already had taken in hand some ten or twelve thousand years ago. The methods of breeding and nurture as well as the equipment of livestock and crop plants have been improved and extended, and the farmers’ work has been “facilitated and abridged” here and there by the use of many mechanical contrivances, as well as by the introduction of more productive contrivances in the way of crop-plants unknown to neolithic Europe, as, e.g., corn (maize) and potatoes and cotton; but all the while it remains true that those technological improvements and advances which have counted substantially toward an enhanced output of farm produce have continued to be something in the nature of elaboration and refinement on the same old procedure of breeding and nurture that supplied the necessaries of life in neolithic times.

There is no call to undervalue the service which the. machine industry and industrial chemistry have rendered, but when all has been said and allowed for it remains true that these agencies of the Industrial Revolution have not made farming over in their own image, and that husbandry is after all a matter of the skilled breeding and nurture of animals and crop-plants ; and the conditioning circumstances which govern these elemental processes of breeding and nurture are still the ancient circumstances of space, air, rainfall, sunshine, soil, and seasons. These conditioning circumstances still govern the farm industry and the life of the farm population. The American husbandry, mixed farming, is necessarily spread abroad over the face of the land. Livestock and crops live and multiply only in that way, and the farm population under whose skilled care they live and multiply will have to live with them. That is the neolithic way.

Quantity-production and the large-scale process come into this mixed farming mainly by way of a figure of speech. It is true, the farm unit has been growing larger gradually during the past half or three quarters century, both on an average and in the typical case ; and that such has been the drift of things during this interval is due to mechanical improvements, to the use of mechanical power and the like applications of the technology of physics and chemistry; but it also remains true that husbandry is not built upon these inanimate factors, and that, in the large, the scale and pace of things in farming still wait on the processes of breeding and nurture, not on the massing of inanimate forces and the concatenation of inanimate chemical reactions.

The farm population is still given over to a workday surveillance of these processes of breeding and nurture. Farm life is still a neighborhood life of homely detail and seasonal fortuities ; and the inveterate habituation to which the farm population is subject still makes for the good old spirit of parochialism and personalities, of neighborhood gossip and petty intrigue. The organisation of the work necessarily runs to small-scale parcelment and isolation ; relatively small working units which are necessarily masterless and self-directing in their processes of work, however greatly they may be tied-up, hampered and retarded by pecuniary obligations to absentee owners outside.

Because of this necessary parcelment, and because of the intimately personal character of the farmer’s technical knowledge and proficiency, he is still the “independent farmer” in respect of the day’s work. Only in a slight, external, and essentially inconsequential way, are the farm population subject to that wide-sweeping, impersonal, mechanistic discipline of standardisation and mass movement that gives its character to the industrial system at large. The abiding and pervasive factors of habituation for the husbandman and his folks are still the homely movements of human nature working in collusion with the animate forces of plant and animal life, settled habits of thought that have to do with breeding and nurture. With the result, among other things, that the rural community is still shot through with prehistoric animism in a degree that passes the comprehension of any person whose habits of thought have been shaped by the technology of physics and chemistry. So it has come about that the rural community is still the repository of timeworn superstitions, magical, religious, and political, such as would do credit to the best credulity of neolithic man.⁴

Technologically speaking, and seen in the light of the latterday industrial arts, agriculture is grounded in a system of holdovers that have come down from remote antiquity and embody habits of thought that are suited to the institutional structure of those good old days ; days which antedate not only the machine industry and Big Business, but the era of handicraft as well. By technical necessity the farming industry is still conducted on a plan of dispersion, discontinuous parcelment, and individual responsibility, so far as regards the day’s work. But in point of business relations the farmer is caught in the net of the system at large ; which is a system of absentee ownership and works out in a network of credit, markets, organised salesmanship, corporate capitalisation, and Big Business managed on the principle of what the traffic will bear. To the farmer and his folks all these things are external circumstances over which he has no control, but to which he and his folks are required to conform on pain of “getting left.” He is within the system but not of it. He and the work of his hands are in it as a bone of contention ; something for adroit salesmen to buy cheap and sell dear, and something to which absentee title is to be acquired by a tactical use of credit.

Reluctantly but as a matter of course the farmer and all his work and ways are involved in the all-pervading system of credit, for more or less. It is a business system, and business runs on credit, and the Big Business which dominates the system begins and ends its work within the convolutions of credit. In the rural community, on the other hand, the rule still runs that indebtedness is an “incumbrance” to be got away from as fast and far as may be. That is to say, the farmer is a victim of the credit system, not a manipulator of it. His property is not assets to be employed as collateral by use of which to swell his capitalisation, but “production goods,” visible means of support to be jealously kept clear of the moneylender, if such a thing were possible.⁵

The farmer and his folks and work are bound by the run of the market, but he does not create or control the run of the market by any exercise of deliberation or discretion on his part. It is not his market, except in the sense that he is dependent on it. Perhaps he “ought” to control his market, and make the terms on which he will buy and sell ; but in practical fact his choice in the matter goes no farther than to take or leave the terms that are offered him. The run of the market is made for him and he can take it or leave it, but mostly take it lest a worse thing befall him. The run of the market is made up on the principle of what the traffic will bear for Big Business, by those massive business interests that move obscurely in the background,—railway interests, ware-house interests, jobbing interests, packing interests, milling interests, farm-implement interests, coal interests, oil interests, steel interests, cordage interests, and the like.

And every once in a while the farmers make a broad gesture of collusive strategy and concerted action. Every once in a while there springs up a hope, born of desperation, that the massive interests which move in the background of the market are to be set at naught by the farmers’ taking thought together in a business way; or they are to be confounded by some intelligent alignment of rural political forces. And always this collusive strategy of the rural communities disintegrates into a par-celment of self-seeking detail and mutual sharp practice, and always the political mass-action of the independent farmers runs out in a dust-heap of parochial chicanery. And the rural community remains an inalienable domain of that business enterprise that buys cheap and sells dear.

In respect of industrial articulation, as regards technical interdependence and mutual support among the members or strata of the existing system, the case stands somewhat as follows. The industrial arts, the employment of this technology of physics and chemistry, come to a head in the manufacturing industries, dominated by standard mechanical processes and quantity production. This industrial system owes its unexampled productivity to the mechanistic technology of the manufacturing industries, and the apex of technological growth is in that field. These industries draw on farming and the key industries for mechanical power, man-power and materials, at the same time that they supply ways and means that are indispensable to the work in farming and the key industries.

The whole constitutes a balanced system of work, a moving equilibrium of interlocking processes, in which the efficiency of any given part is conditioned on the due working of all the rest. No part of the system can do its share of the work in isolation or in severalty, and any degree of failure or curtailment at any point, in rate, volume or quality of output, entails a degree of curtailment and inefficiency throughout the system. The dominant factor in this moving equilibrium of work, technologically speaking, is the manufacturing industry, and it is on the output of this industry that the efficiency of the industrial system converges.

Such is the technical character of the system as an industrial organisation, and such would be its working balance and articulation in the absence of other incentives and considerations than the production of useful goods. But under the existing system of ownership that consideration is not decisive. The incentive of business is not to produce goods but to make money, and business considerations are decisive in the control and management of the industrial system. And the articulation and balance of the industrial system as it is organised for business purposes is accordingly a different one. Technologically the apex of the system is the manufacturing industry, but in the business organisation of it the key industries are at the apex; and they hold this dominant position by owning the right to retard or curtail the supply of necessary power and materials that goes to the manufacturing industries. Industrially the country’s farming is the primary source of its livelihood, and therefore of .its available man-power, but in the business organisation the farm community serves as ways and means of that commercial enterprise that handles the country’s manufactured products, which in turn is subject to such businesslike curtailment and retardation as the pursuit of profits in the key industries may entail.

What has just been said about the industrial system describes the situation in America. And what is true of America will hold true with an inconsequential change of words for the industrial system more at large, to include the civilised nations, in about the same measure in which they are civilised ; or a more guarded statement would be, in the same measure in which they are included in the framework of the modern European civilisation. In many of the characteristic features of the case America may be taken as an exemplar of the civilised world, particularly as regards the civilised world’s present status in industry and business.

The civilised nations, in the degree in which they are civilised, are all unavoidably bound together in a single working system of industry, and they are now similarly bound up in a comprehensive system of business enterprise; although the articulations of business run on lines somewhat different from those technological lines of specialisation and mutual support that bind the civilised peoples in an inclusive organisation of industry. In the industrial respect, as determined by the state of the industrial arts, the civilised peoples are held in a net-work of interlocking processes of work, so close-knit and so far-reaching as to make them a single going concern working together toward a maximum quantity production of staple goods by use of the world’s known resources of mechanical power, raw materials and man-power. All this is quite obvious, and it is coming to be quite familiar, at large and in detail, to the technical men within whose horizon these matters lie.

But in respect of their business interests, or rather in respect of the strategy of their business men, the civilised nations are not similarly bound together in a cooperative commonwealth. Business enterprise, being competitive, runs at cross purposes. And it is these cross purposes of business enterprise that chiefly obstruct the due articulation of industrial undertakings and so act to derange and curtail the work in hand, both in the industrial system at large and in the detail conduct of industrial undertakings within any given national frontiers. As the matter stands now the division between nations is a division of business interests, and national policies are chiefly occupied with the competitive cross purposes of vested interests which do business under one flag and another. This, too, is quite obvious, and it is a familiar matter of course, at large and in detail, to the absentee owners and statesmen who have to take care of these matters.

1: As has been remarked in an earlier passage, “inordinate” is here employed in something of a technical sense, as meaning excessively and unguardedly productive, beyond the ordinary needs of business in ordinary times. That is to say, if the available resources in the way of materials, equipment and man-power were to be employed under competent technical management with a view to maximum production, the output of industry would be greatly in excess of what the traffic will bear, considered as a business proposition. Not that the output would exceed the consumptive capacity of the underlying population, but only that it would be too large to yield the maximum net gain in terms of price to the business concerns of the country. “Inordinate” refers to the needs of business, not to livelihood.

2: The past three or four years (1920-1923) have shown how these matters stand. The country’s industry has hung in a state of suspended animation while the business concerns that take care of coal, iron and transportation have been engaged—no doubt righteously and legally—in bringing the man-power employed in those industries to profitable terms by a campaign of protracted unemployment and privation.

3: The underlying principle of it all was formulated in another connection by Jacob Fugger back in the 16th century: . . . “er wäre kleinmutig . . . wollte verdienen dieweil er konnte.”— Quoted by Sombart, Moderne Kapitalismus, first edition, vol. I. p. 396.

4: To this pervasive animistic credulity of the rural community the salesmanlike folks of the country town have to “play up,” in their unremitting pursuit of profitable customers. So that by force of salesmanlike pusillanimity the country towns are driven to underbid the lowest survivals of neolithic animism in a competitive endeavour to conform to all holdovers of superstition that may conceivably have a commercial value; as has been explained in an earlier passage.

5: Right lately, the farmers and their delegates among the nation’s official personnel have been much occupied with contrivances for facilitating and amplifying “farm credits,” designed to bring agriculture and the farm population within the pale of the credit-system and enable them to turn their assets to account as collateral on which to expand their effective capitalisation. Of course, as seen from another angle, the whole project may also look like a contrivance to induce the farm population to increase their liabilities and overhead charges beyond what their earn-ing-capacity will bear.