Chapter VI: The Capitalist System as a Cause of War

In the foregoing analysis of the morbid growths and insidious diseases to which capitalist enterprise is now seen to be increasingly prone—growths and diseases which lead to the inference that profit-making capitalism, with all its initial advantages, has now ceased to be, on balance, profitable to the community—we have dealt exclusively with its effect upon the aggregate production of material wealth. There still remains to be considered an even graver indictment of the capitalist organization of industry, and of the profit-making motive on which it depends, namely, that this system has, in modern times, become increasingly the cause of disastrous wars between nations. Indeed, if we limit our survey to the most advanced industrial communities, during the past half century, it is not too much to say that the struggle for pecuniary profit among rival groups of capitalist entrepreneurs may be recognized as having been the most potent cause, though usually an underlying and partially hidden cause, of recent international conflicts, including, in particular, the culminating calamity of 1914-18. What with these national wars, and, as we shall describe, what with the equally injurious class war that capitalism so obviously provokes, it becomes a matter for the gravest apprehension whether, if it is not immediately controlled in the public interest, and progressively replaced by some better organization of industry, with some other incentive than profit-making, the reign of capitalism is not destined to destroy civilization itself.

War Between Nations

Let us first consider the close connection between the highly developed capitalist system, with its increasing hypertrophy of trading and financing and concentration of production in little monopolist groups controlling a colossal output, and the growth, during the last few decades, of a predatory imperialism among the great powers, at last issuing in the Great War of 1914-18.

So long as British manufacturers and merchants had a "natural monopoly" of the raw materials and markets of the world, they were indifferent to the growth of the British Empire, and regarded even territories colonized by British people as almost useless encumbrances involving expense to the British taxpayer. But with increasing competition among themselves, and with the entry into the world-markets of the manufacturers and merchants of the United States and of the German Empire, not to mention the "rising sun" of Japan, the political faith and economic doctrine of the British profit-makers gradually changed to suit their altered circumstances. To insure the continued profitable disposal of the huge output of commodities characteristic of these world-wide trusts and amalgamations, there was needed, not only command of the sources of supply of raw materials, but also a position of dominance in foreign markets, free from hostile protective tariffs, and able to forestall, by protective tariffs of their own, the potential competition of producers in other nations who were outside the combination. Hence, from being convinced free traders, "little Englanders" and anti-militarists, the British capitalists of the last decades of the nineteenth century became increasingly distrustful of their old creed, and more and more sympathetic to Protection, and to the extension of the Pax Britannica to all corners of the earth by a powerful navy and a costly expeditionary army. John Bright, the cotton manufacturer of the middle of the nineteenth century—a period when British cotton goods held the markets at home and abroad—was the protagonist of cosmopolitan pacifism. Joseph Chamberlain, his great successor in the leadership of the Radicals, fresh from establishing in the United Kingdom what was practically a monopoly in the manufacture of screws, became convinced by the end of the century that "the Empire. . . is commerce. . . It was created by commerce, it is founded on commerce, and it could not exist a day without commerce. . . For these reasons, among others, I would never lose the hold which we now have over our great Indian dependency—by far the greatest and most valuable of all the customers we have or ever shall have in this country. For the same reasons I approve of the continued occupation of Egypt; and for the same reasons I have urged upon this government, and upon previous governments, the necessity for using every legitimate opportunity to extend our influence and control in that great African continent which is now being opened up to civilization and to commerce; and, lastly, it is for the same reasons that I hold that our navy should be strengthened until its supremacy is so assured that we cannot be shaken in any of the possessions which we hold or may hold hereafter. . .If the little Englanders had their way," he added with scorn, "not only would they refrain from taking the legitimate opportunities which offer for extending the empire and for securing for us new markets, but I doubt whether they would even take the pains which are necessary to preserve the great heritage which has come down to us from our ancestors."¹

The powerful but crude imperialism of the leading British statesmen was reënforced by the more polished but more pointed utterance of the leading British proconsul. "You cannot have prosperity without power," stated Lord Milner in an address to the Manchester Conservative Club in 1906, "you, of all peoples, dependent for your very life, not on the products of these islands alone, but on a world-wide enterprise and commerce. This country must remain a great Power or she will become a poor country; and those who in seeking, as they are most right to seek, social improvement, are tempted to neglect national strength, are simply building their houses upon the sand. 'These ought ye to have done, and not to leave the other undone.' But greatness is relative. Physical limitations alone forbid that these islands by themselves should retain the same relative importance among the vast empires of the modern world which they held in the days of smaller states—before the growth of Russia and the United States, before united Germany made those giant strides in prosperity and commerce which have been the direct result of the development of military and naval strength."² (The italics are ours.)

The Trail of the Financier

After the manufacturers and merchants of Great Britain came the financiers. When capital has accumulated in large fortunes, when the rate of interest at home begins to fall, the discovery is made that there are many uncivilized races, and some races whose ancient and pacific civilization does not permit them to defend themselves, who can be more easily exploited than fellow citizens. "The maximum amount of harm," we are told by Lord Cromer, "is probably done when an Oriental ruler is for the first time brought in contact with the European system of credit. He then finds that he can obtain large sums of money with the utmost apparent facility. His personal wishes can thus be easily gratified. He is dazzled by the ingenious and often fallacious schemes for developing his country which European adventurers will not fail to lay before him in the most attractive light. He is too wanting in foresight to appreciate the nature of the future difficulties which he is creating for himself. The temptation to avail himself to the full of the benefits which a reckless use of credit seems to offer to him, are too strong to be resisted. He will rush into the gulf which lies open before him, and inflict an injury on his country from which not only his contemporaries but future generations will suffer."³ Hence the export of capital becomes even more attractive to the profit-making capitalist than its utilization in the extension of manufacturing facilities at home, or the provision of the most urgently needed public services. If trade follows the flag, the flag has to reciprocate by following the money-lender in order that it may protect him from his disappointed and enraged creditors. Moreover, there are always the traders and financiers of the other great capitalist Powers, equally anxious to exploit the barbaric man. "There is commonly a handsome margin of profit in doing business with these pecuniarily unregenerate populations," explains the American critic in the Theory of Business Enterprise, "particularly when the traffic is adequately backed with force. But, also commonly, these peoples do not enter willingly into lasting business relations with civilized mankind. It is therefore necessary, for the purposes of trade and culture, that they be firmly held up to such civilized rules of conduct as will make trade easy and lucrative. To this end armament is indispensable."⁴ But in the portioning out of the trade perquisites that fall to the proselytizers any business community is in danger of being over-reached by alien civilizing powers. No recourse but force is finally available in disputes of this kind, in which the aim of the disputants is to take advantage of one another as far as they can. A warlike front is therefore necessary; and armaments and warlike demonstrations have come to be a part of the regular apparatus of business, so far as business is concerned with the world market."⁵ "A state of commerce," we are told by a leading German industrialist, "has always been in a certain sense a state of war—a peaceful state of war, if one may use the word, which served peaceful ends as long as peace lasted, but which always lent itself to warlike designs, whether there was a war or not."⁶

The Unashamedness of Imperial Capitalism

Thus we see in all capitalist countries the armament makers, often using subsidized newspapers, pressing close behind the peaceful penetration of the capitalist profit-maker. There is, however, one refreshing feature about the manufacturers of and the traders in the weapons for human slaughter. Their vocabulary contains no cant about humanitarianism; they are not even guilty of using the cloak of patriotism. The manufacturers of warships and torpedoes, of rifles and cannon, of shrapnel and high explosives, are completely indifferent as to the character and nationality of their customers. The same amalgamation will have factories in different countries, and on its board there will sit the industrial magnates of rival nationalities. They "do business" impartially with the government of their own country or with the governments of allies or potential enemies. What suits them is not a League of Nations, nor even a "balance of power," but an unstable equilibrium, producing scares in one country after another, so as to lead to the maximum world expenditure on armaments. And who can blame them? Did not Adam Smith teach us that "the natural effort of every individual to better his own condition, when suffered to exert itself with freedom and security, is so powerful a principle that it is, alone and without assistance. . . capable of carrying on a society to wealth and prosperity." What Adam Smith did not foresee was that this same self-regarding principle, abnormally intensified and distorted by the international scramble for neutral markets, is equally potent in dragging society into the most devastating of wars, and likewise, as may now be added, into the most disastrous of all recorded international settlements after war, exactly because this Treaty of Versailles was based on the fundamental principle of commercial capitalism: "the profits to the victors."

How Wars Occur

The moral is that it is not possible to confine the effect of great armaments, patrolling the globe for the protection of profit-making enterprises, to the intimidation of half-civilized debtors, the enforcement of commercial contracts, and the defense of factories and commercial garrisons. If what is called "peaceful penetration" results in the presence of a foreign warship in a national harbor, a fort will inevitably be built capable of sinking that warship lest it should be made the instrument not only of commerce but of dynastic ambition and conquest. Such a fort will lead to another and more heavily armed ship; and such another ship to another fort with guns of longer range. The same strain is set up by a military expedition. Its purpose may be to enforce the payment of interest on a foreign loan in an imperfectly commercialized country, or to clear desert trade routes or what not. But the inevitable result is the appearance of another military expedition to keep the first one within bounds, as, for example, when Kitchener, having secured the interest on the Egyptian loan and "smashed the Mahdi," found himself suddenly under suspicious observation by a French expedition under Major Marchand, with the immediate result that relations between France and England became dangerously strained, and France, getting the worst of it for the moment, set to work to re-enforce her military position in Africa very markedly.

If capitalism could control the diplomatic and military situations it thus inevitably creates, Cobden's dream of a universal peace founded on foreign trade might not have been wholly illusory. But it is impotent in the face of the national passions, the international jealousies and terrors, the romantic pugnacities roused by its attempts to use national armaments as a trade police. It cannot even pursue these attempts with pacific integrity: the establishment of an effective police in its completeness means nothing short of conquest and annexation; and these mean war, which, though colossally profitable to certain trades for the moment, involves an appalling destruction of capital and thrusts a ramrod into the financial machinery on which the whole business of foreign trade, and consequently of much domestic trade, depends. Hence, though the great world war of 1914-18 was an inevitable incident in the pursuit of outlandish markets by capitalism, the capitalists, when the fatal hour struck, recoiled from the war as sincerely as the conscientious objectors themselves, and had to be swept into it by entirely uncommercial romantically patriotic considerations and passions, knowing that the destruction of capital, the dislocation of commerce, the diversion of labor on a gigantic scale from production to slaughter and ruin would overwhelm all their best-laid schemes. Thus it is equally true to say that the City made the war and that the City was against the war. In short, in diplomacy and war, the profiteer hegemony is omnipotent for evil and impotent for good. It can bind; but the sword has to loose.

Britain's Share

We may now summarize the relation between the dictatorship of the capitalist and the nearly continuous warfare that followed the inauguration of world peace by the London Exhibition of 1851, and culminated in the monstrous catastrophe of 1914-18. It was the British capitalist who, fortified in his faith by the early political economists, first made of the pursuit of pecuniary gain what we may not unfairly call a national religion. It was British publicists who provided a rational basis for the callousness of the big manufacturer in his slaughter of children and his maiming of young people of his own race through the early factory system. It was a priest of the Established Church of England, the Rev. Thomas Robert Malthus, who declared that death by starvation for those who were thrown out of work and deprived of wages by the ups and downs of foreign trade was not only a "natural law" but also "God's law" for adjusting the population to the means of subsistence. It was, in fact, British commercialism that prepared the moral conscience of mankind for the German theory of world power. Bismarck and Treitschke were the spiritual descendants of Ricardo and Nassau Senior. In the last quarter of the nineteenth century we watch the conscious extension of this idealization of profit-making to national statecraft, by the deliberate molding of a nation's foreign policy to the purpose of augmenting the profits of its capitalist entrepreneurs; profits to be derived, be it noted, not from a common international progress in production and exchange, but, specifically, from the pecuniary loss of the business men of other nations.⁷

This identification of motive in the individual capitalist and the state was openly proclaimed in the policy of the German Empire after 1871. "The one sound basis of a great Power which differentiates it essentially from the petty state," declared Bismarck, "is political egoism and not romanticism; and it is unworthy of a great state to fight for what is not connected with its interest."⁸ The moral philosopher may question whether the German version of the struggle for existence was not less ignoble, though possibly more dramatically dangerous, than its English forerunner. "My country, right or wrong," is, we think, a less debased guide to feeling, thought and action than "my own pecuniary interests, right or wrong." And those who delight in argument from analogy may find justification for this preference in the relative psychology of the dog and the cat. The dog, we are told by the experts of the new psychology, derives its descent from an animal that hunts its prey in packs and possesses in a highly-developed form the herd instinct; whilst the cat is related to the tiger that kills for himself alone, and is therefore incapable of the impulsive self-devotion which the dog habitually shows as the companion of the man. The followers of Adam Smith, like the tiger and the cat, left no place for self-devotion and self-sacrifice, seeing that it was the pecuniary interest of the individual, or at best of the individual and his family, that was to be alone considered. The passionate patriotism of the German race, however distorted by dog-like devotion to the Fatherland, had, at any rate, the quality of the voluntary self-sacrifice of the individual to the power and wealth of the community to which he belonged. But this distinction between British and German morality does not complete the picture. The German people had some justification in feeling that equity as well as national self-interest was embodied in an aggressive policy. When the German manufacturers, traders and financiers came into the world market they discovered, or thought they discovered, that at least a quarter of the trade of the world had followed the flag of the British Empire,⁹ while the United States of America and the Russian Empire dominated more than half of the remaining territories and populations. Was it surprising that the German government, and even the German people, sincerely believing with Joseph Chamberlain and Lord Milner that profitable commerce with the undeveloped countries was dependent on national prestige, on "spheres of influence" and fiscal protection, felt that they were hemmed in, and deprived of their legitimate share of the profits to be derived from the exploitation of the labor and resources of other races? The Court, the General Staff, the civil administration, the bulk of the university professoriate, and the leading industrial and financial magnates, became obsessed with the desire to augment the German export trade at the expense of the export trades of other nations. If peaceful means did not prevail, rapidly and completely, why should not they call in aid the power created by the Prussian capacity for military organization? Had not the British government, time after time, called in the British fleet to round off and complete the encircling British Empire? It was in this way, we suggest, that the apotheosis of individual profit-making led inevitably to the Great War.

The Class War

But incalculably grave as is the indictment of capitalism as constituting the underlying cause of war between nations, there is a further count. War between nations, even on so great a scale as that of 1914-18, is only episodic. More continuous and universal, and therefore probably more potent in its effects on society, is the class war which the capitalist organization of industry, with profit-making motive, has gradually created in every advanced industrial community. We now see the Owenite Trade Unionism of 1834, the Chartist Movement of 1837-48, the uprising of the workmen of Paris and Lyons, Dresden and Vienna in 1848, the violent outburst of the Paris Commune in the defeated France of 1871, together with the abortive Russian revolution of 1905, as only the precursors of a movement of revolt by the manual workers, which to-day extends to nearly every nation, and, in countries of advanced industrialism, falls not far short of being co-extensive with the whole wage-earning class. For as the capitalist system became dominant, in one country after another, the wage-earners had burnt into them, generation after generation, the doom of perpetual penury, varied only by recurrent destitution through unemployment, to which, as a class, they were condemned. They necessarily realized far more keenly than any other section of the community the deprivation of personal freedom that their poverty involved: a deprivation all the more galling in contrast with the almost boundless increase of freedom which the new wealth production brought to those who reaped the swelling profits. It was the manual workers, and their children, on whom fell the ever-increasing toll of industrial accidents and industrial diseases, which the capitalist system brought in its train. It was their class that suffered the physical and moral degeneration, the sickness and premature old age that resulted, in Britain, from the unrestrained profit-making of the early-Victorian mines and factories, and from the unregulated urbanization of the countryside. The long spells of recurrent unemployment characteristic of the modern machine industry, in the United States as well as in Britain, which seemed to an enlightened capitalist like "the orderly beating of a heart, causing the blood to circulate—each throb a cycle,"¹⁰ may possibly mean to the successful brain-working entrepreneurs a greater stimulus to exertion and inventiveness: to millions of manual workers they mean involuntary idleness with insufficient food, and with this food obtained, if obtained at all, through the demoralizing process of doles. Not until the later part of the nineteenth century were the bulk of the manual workers sufficiently educated to organize an industrial and political revolt against a system of conducting industry, against which their leaders had never ceased to protest. The twentieth century found the feeling of a class war of an irreconcilable cleavage of interest between the "two nations" in each land—rapidly spreading to nearly every section of the wage-earners, in practically all countries in which the capitalist system had become dominant.

Let us note that this secular struggle of the wage-earners against the capitalists has varied, in its capacity for sheer destructiveness and its incapacity for social reorganization, according to whether the dictatorship of the capitalist has or has not been tempered by the reign of democracy within the state. Under the ruthless and corrupt autocracy of Russia with its complete exclusion of the town workers and peasants from participation in the government, the leaders of the "Bolshevik" or "majority" section of the socialist movement, when suddenly loaded with the responsibilities of government by the revolution of 1917, were forced to abandon all pretense of democracy, and establish "the dictatorship of the proletariat," which was certainly a dictatorship, but under it, as before, the proletariat was dictated to, and the government prisons were as full, and its rifles as active, as those of the Tsardom, in spite of the sincerity of its aim at the common good. In the well-ordered and highly-civilized autocracy of Germany, tempered as this was by a wide suffrage and a semblance of parliamentary institutions, the rapidly growing socialist party accepted the Marxist shibboleth of dictatorship of the proletariat without deciding whether it meant, as Marx meant by it, a phase of martial law ruthlessly administered by the victorious revolutionists, or government by the representatives of the people as a whole, the majority of whom would necessarily belong to the manual working wage-earning class. This ambiguity of phrase, and failure to think out clearly the steps to be taken, involved a disastrous division of opinion in the workers ' ranks, and sterilized, for the first years after 1918, the otherwise powerfully organized Labor and Socialist movement. In Britain, Sweden, Denmark and Belgium, and in Anglo-Saxon Australasia, countries in which political democracy had been firmly established, the first decades of the twentieth century saw the rise in the legislatures of a definite Labor and Socialist Party, demanding, and to some slight extent beginning, the reconstruction of society, on a socialist basis, but avowedly limiting itself, as a democratic party, to constitutional methods of political democracy. Even in these countries, the Labor and Socialist parties bear the stigmata, in the diseases of democratic infantilism from which they suffer, of the environment in which they have been bred.

We must therefore solemnly warn our capitalists and governments that if they are well advised they will no longer dare to say "After us the deluge," or to depend on its fury spending itself in Russia and sparing us to muddle through without unpleasant incidents. The working classes have been even more deeply commercialized in some respects than the capitalists, because the capitalists become rich enough to follow the ancient Greek precept, "First gain an independent income, and then practice virtue." The late Andrew Carnegie practiced virtue, even civic virtue, on a stupendous scale when he had built up a colossal fortune on the ruthless exploitation of Pittsburgh. But the working classes never reach the turning-point: they are struggling desperately for an income all the time, and cannot exercise the Carnegian virtues, or acquire the moral amenities which go with them. Thus the capitalist, ever thinking of the rate of profit instead of social service, is reflected in the workman thinking only of wages and hours; selling himself to the highest bidder; and, on business principles, assuming that he should give as little as possible, for as short a time as possible, in return for as much as possible. This sort of sale is in its essence prostitution; and it cannot be imposed on generation after generation of workers without finally disabling them from regarding their emancipation in any other light than that of a fight for mastery of the sources of production in which they must win by "downing" their present masters: in short, of class war. Thus the evil fate which we have seen dogging capitalism in foreign affairs pursues it pitilessly in home affairs also; and compels it to imbue its slaves with the very instinct of plotting, outwitting, over-reaching, grasping and fighting that makes revolution as inevitable as war. All the more reason for a vigorous disowning and discrediting of the profit-seeking motive, before its prevalence makes reasonable and peaceful social solutions impossible.

Universal Sabotage

For consider what commercialization means. The capitalist, without the slightest hesitation, will destroy masses of useful products, or close down his works and abandon his employees to starvation in order to keep up prices. That is flat sabotage; and sabotage is a force that now threatens the existence of civilization. It is idle for the capitalist press to reserve the odious term for the parallel retaliations of the working class. In the running fight between Capital grasping at more profit, and Labor grasping at higher wages or desperately staving off a reduction, no moral distinction can be shown between the colliery owner who locks out his workmen from their livelihood and the workman who takes care that the locked-out mine shall be flooded for want of labor to pump it dry. The conspiracies by which the Trusts undersell and ruin small competitors until they have swallowed up a whole trade, and have the public at their mercy as to prices, are object-lessons to the combinations by which workmen make life impossible for the blackleg who takes less than the Trade Union rate of wage, or who sets a rate of working which gives the employer more than the market value for it. The authors of the silly jokes in our comic papers about bricklayers who lay two bricks a day forget that it is just as good business on capitalist principles for a bricklayer to reduce his tale of bricks as for his employer to cut wages. The limits to waste, to ca ' canny, to sabotage, in short, to doing one's worst, are not moral limits in capitalism: they are economic limits set by the fact that if the ultimate consumer does not receive some value for his money he will not buy, and both employer and workman will be left destitute. But the demoralization of the parties is none the less complete because circumstances prevent them from reducing their immorality to absurdity. The habit of sabotage which it creates is growing on both of them with alarming rapidity.

Sensational instances will be found in the war of 1914-18, when successful invasion was accompanied as a matter of course by senseless sabotage; but there was nothing new in this. The peculiar form of sabotage which consists in simply burning the houses of economic opponents was practiced in the peasant wars of the fourteenth and sixteenth centuries, and revived with most dangerously suggestive success in the French Revolution and the establishment of the Irish Free State. The Luddite riots were so called, we are told, "after Ned Lud, a Leicestershire imbecile, who in a fit of passion demolished two stocking-frames." But the working men of 1811, the German general staff of 1914, and the Irish leader Michael Collins in 1920, did not regard Ned Lud as an imbecile, but as a strategist worthy of all imitation. We must face the practical certainty that if the transition from capitalism to socialism is not intelligently anticipated, planned and guided by the rulers of the people, the people, when the breaking strain is reached, will resort to sabotage to force whatever government may be left to tackle the job of reconstruction; and the danger is that the sabotage may go so far as to make the job impossible.

Consider, too, the unanswerable arguments placed by the war in the mouths of the saboteurs. They are told that trade is bad; that public enterprise is inefficient, corrupt, impossible and does not pay; and that they must tighten their belts and starve as best they may until trade revives. Their reply is crushing. They point out that when the government was confronted with the alternative of feeding and clothing them better than most of them had ever been fed and clothed in their lives before for four years, besides equipping them at enormous expense with instruments of destruction and slaughter, all out of the resources of the country, and yet retaining financial credit enough to borrow huge sums to lend to its allies, or else of having its throats cut by German bayonets, it discovered at once that all this was easily and lavishly possible. And they naturally, and quite soundly, conclude that the government could, a fortiori, feed and clothe and house and equip them for peaceful and fruitful production if the same steely incentive were applied. To this the constitutional parliamentary Labor leader has absolutely no reply except that as the saboteurs are incapable of organizing the throat-cutting as the German general staff organized it, the attempt would necessarily fail. Which again only throws the saboteur back on sporadic unorganized sabotage, wrecking of machines, blowing up of trains, burning of chateaux. Moral remonstrance and virtuous indignation are useless; if the game is to be one of pull-devil-pull-baker, and trading without conscience is to be the order of the day, capitalism need not hope to die quietly in its bed; it will die by violence, and civilization will perish with it, from exhaustion.

It may be said that the capitalist system has survived worse times. But it did so because, as Mr. Maynard Keynes has said in ringing phrases, it bluffed the people morally. "I seek only to point out," said the Cambridge economist, "that the principle of accumulation based on inequality was a vital part of the pre-war order of society and of progress as we then understood it, and to emphasize that this principle depended on unstable psychological conditions which it may be impossible to re-create. It was not natural for a population, of whom so few enjoyed the comforts of life, to accumulate so hugely. The war has disclosed the possibility of consumption to all and the vanity of abstinence to many. Thus the bluff is discovered; the laboring classes may be no longer willing to forgo so largely, and the capitalist classes, no longer confident of the future, may seek to enjoy more fully their liberties of consumption so long as they last, and thus precipitate the hours of their confiscation."¹¹

It is time to realize that the great significance of Karl Marx, of whom so much ignorant nonsense is still current, is not that he revolutionized economics and political science, but that he called the moral bluff of capitalism. The theoretic mistakes of Marx are as patent nowadays as the mistakes of Moses; but nobody who has ever read the historical chapters of Das Kapital can ever again fall under the illusion that capitalists, as such, are morally respectable. Marx, in spite of all his pretentious blunders in abstract economic theory—blunders which were not even favorable to socialism—succeeded magnificently in suddenly turning the banners of capitalism with their seamy sides to the audience, and presenting the drama of modern civilization with the bourgeois as the villain of the piece. In our intercourse with the Soviet Government of Russia nothing puzzles and scandalizes our diplomatists more than the assumption of the Communists that the advantage of moral prestige is on their side, and the impossibility of impressing any sort of respect on the attitude of ironic tolerance which is their nearest approach to international courtesy. To the British Foreign Office this seems mere impudence. No more dangerously misleading mistake could be made. The capitalist (bourgeois, as he is now generically described on the continent) does actually stand convicted of moral inferiority before the working classes; and neither the constitutional socialist nor the gunman-saboteur has any respect for him, or any belief in his necessity as a pillar of society.

Thus the class war has come to be regarded as a holy war, not without strong grounds, as this book has shown. To assume, as our capitalist statesmen and their journalists commonly do, that the proletarian combatants must know themselves to be criminals, and are mere looters of society without any conscientious sanction, can only lead to a most perilous undervaluation of the strength and persistence of the revolutionary forces at work in the world. It leads directly to the careless and uppish conclusion that the remedy is simply an increase in the police force and in the stringency of the criminal law. Such measures can inflame and exasperate a popular moral force: they cannot control it. If the people are not convinced that the police are morally right, they will finally burn down the police station, and nobody will give evidence against them.

The Armageddon of Economic Creeds

The last thing we would desire is to play the alarmists; for if anger is a bad counsellor, panic is a worse. But we cannot shut our eyes to the fact that worse things than any sensible citizen thought possible ten years ago have happened and are still happening daily, because our obsolescent institutions have been allowed to strain human endurance to breaking point instead of being modified to suit contemporary demands and conditions. The state of things in many other countries is much worse than-as yet-in Great Britain. Large stretches of Central Europe are reverting to the pre-capitalist stage of a sparsely populated agricultural country, dotted with industrial centers in rapid disintegration, destitute, diseased and disorderly, and with a violent antagonism growing up between their industrial proletariats and the peasants who are now not masters of the situation, which is unfortunately unmastered (that is the whole trouble), but of the food supply and consequently of the subsistence of the town proletariats. This seems to be the case in Russia and in Austria; and it may become the case in a much more threatening way in Germany. Now we have seen that even when capitalism is at the height of its productivity, the slum centers of its activity are foci of disease, of disablement for agricultural life, and of unemployable destitute persons. If even their productivity is wrecked, the result is the state of things that existed in Germany after the Thirty Years War, when bands of famishing persons were plundering enraged peasants and being massacred by them. These horrors are not extinct: rather have we elaborated them by the pogrom, which, being an economic phenomenon, strikes the Christian Armenian as mercilessly as the Jew.

To stave off this extremity of social disaster the Italian bourgeoisie are arming themselves to subjugate the proletariat by open violence. For some years past the capitalists of the United States have been waging quite extensive wars against the laborers ' unions. In the latest dictionaries such words as Fascisti and Pinkertons have to be defined as the mercenary soldiers of capitalism. And this is at a moment when the capitalist recruiting sergeants find the world full of young men who have learnt no trade but the trade of the trenches, who are experts with the bomb and the rifle, and who have been broken in to hold human life cheap and the value of property negligible.

As against these private troops of private capitalism the proletarians and the revolutionary intellectuals are advising and carrying out wholesale sabotage of the capitalist system, precisely as the republicans in Ireland, when they were united against English rule, sabotaged their country gentlemen and the industrial proprietors into forcing the government to make Ireland a Free State, and as the republicans who dissent to that settlement are now continuing the sabotage in an effort to force a complete detachment of Ireland from the British Commonwealth of Nations. The sabotage may fail in the one case as it has succeeded in the other; but either way it is so destructive that it must recoil ruinously on all the parties. The instance is menacingly close to our own doors. The example of Ireland is much talked of on the Clyde, the Tyne, the Tees, the Taff and other centers of unemployment. And if men who build ships and hew coal are ripe for sabotage, men who build houses and factories, and make machinery, are not likely to be more scrupulous in making jobs for themselves by destroying their own work.

We must not console ourselves by saying, as both the Marxist and capitalist doctrinaires do, that all wars are economic wars, and that economic wars soon blow over. That is so far true that very few men—not enough to count against the police—will fight for an economic advantage when they are given enough to live on as well as they have ever been accustomed to live. But as we have already shown, Communism is a religion, and belief in property a creed. The conflict between them is inspired by moral abhorrence as well as by cupidity; and the press on both sides appeals to this moral abhorrence, and says as little as possible about the selfish motive. Just as it would have been very difficult to induce the English people and the German folk to slaughter one another for those economic considerations which were the real grounds of the war, and each had therefore to be persuaded that the other was not human but fiendish, so there would be little reason to fear a class war of any formidable extent if the combatants could not be persuaded that they were engaged in a righteous crusade against the enemies of mankind. This persuasion is already in full swing in the columns of the capitalist press: we are all conscious of it. What our governing classes are not conscious of is that exactly the same persuasion, backed by terrible evidence, is at work on the other side; and that the class war, if and when battle is joined in earnest, will be one of the wars of religion, and may be waged on a scale, and with a ferocity, a self-sacrifice, and a persistence which will make the religious wars of the seventeenth century seem mere riots by comparison. They may begin by attempts at an international boycott of persons professing particular economic views. The United States already excludes Bolshevists who are truthful or simple enough to announce themselves as such. Russia excludes professed Hundred-per-cent Americans. This is boycotting, the most oppressive form of sabotage. If it spreads from country to country it may prove the beginning of a conflict in which nationalism, freedom of travel and settlement, liberty of opinion, racial equality, and many other war cries, may serve as pretexts for drawing of the sword for the Armageddon between the dogmas of Communism and Property—dogmas as irrelevant to any sane reconstruction of the industrial order as were Free Will and Necessity to the growth of the religious spirit.

The Moral Issue

We are thus brought to the conclusion that the failure of the reign of capitalism, as the principal form of the nation's industrial and social organization, must now be recognized and admitted. It is not merely this or that excess or defect that stands condemned by the world's experience. The making of pecuniary profit has proved to be a socially injurious and even a dangerous stimulus to activity. The very motive of pecuniary gain, on which Adam Smith taught the whole world to rely, is not one by which human action can be safely inspired. After a whole century of trial, the dictatorship of the capitalist for the purpose of private gain has failed to commend itself to the judgment of democracy throughout the world. And to-day the Christian Church is driven to proclaim its agreement with democracy. Addressing the English Church Congress in 1922, the Archbishop of York thus delivered the Christian judgment on the "vast system of beliefs and practices and policies, industrial, political, international, which we may roughly call Western civilization. It reached its zenith in the last century. It was admirably contrived for the production of wealth and power. With magnificent enterprise it yoked to its service the discoveries of science. It created and satisfied a thousand new demands of comfort and convenience. It called into being a vast industrial population. It stimulated patriotism by its belief in the survival of the strongest. But its motives, governing individuals and classes and states, were non-Christian self-interest, competition, the struggle of rival forces. Now these motives have over-reached themselves. They are breaking the fabric which they built. Surely the truth of this is writ large in the outbreak of the Great War and the perils of Europe to-day. The fabric itself cannot be overthrown without disaster. But if it is to be a blessing, not a blight, to mankind, its motives must be transformed."¹²

We suggest that—as with the last great aggression of the Hohenzollerns and their military advisers—it would have been a lasting calamity had the result been otherwise. The failure of capitalism is a good thing for humanity. The victory of irresponsible power over the lives of the mass of the people, even if it were confined to "economic" power, would have been a moral catastrophe. Whatever may be thought as to the indispensability of the motive of profit-making, no one ventures to assert that it is a high motive, or a noble aspiration. It admittedly does not lead to the production of art and beauty; it is a mockery of justice; it is inimical to friendship; it is not the parent of love. Even the keenest profit-maker instinctively resists the introduction of this all-powerful motive into his own family relations, in which a diametrically opposite set of principles is allowed to prevail. This "truce of God" is popularly extended to pecuniary relations between connections, between personal friends, and even to some slight extent between members of the same occupation or social class. Whole professions, indeed, make a pride of repudiating the profit-maker's creed as regards their own services. The army, the navy, the doctors, the clergy, the teachers, the judges, the fire brigade, police, and, in fact, all the salaried officers of the community have at no time accepted the making of profit as the guide to conduct in their own vocations. Moreover, by a peculiar illogic, the motive of securing personal profit has, in Britain at any rate, never been supposed to govern those who directed the affairs of state; and the cabinet minister, the colonial governor, the ambassador, the member of Parliament, the town councilor, or the justice of the peace who has aimed at the making of profit for himself out of the public service, has always earned, like Simon Magus, not public approval but public contempt. No doubt the opposite taste can be acquired. We recall the remark of a commercially-minded youth who was temporarily acting as secretary to one of these devoted and entirely unpaid county administrators on whom so much of our social organization depends. He disliked, he said, "this morbid atmosphere of public work, with its everlasting thinking of other people's needs." He longed to get back to the more satisfying occupation of totaling up the weekly profits of his father's shop. The socialist, whilst by no means despising full maintenance for himself and his family (and, in fact, demanding it for every one), feels a profound dislike for greed of gain as the dominant motive; he demands that the "desire for riches" shall no longer be made the basis of our statecraft, no longer preached to the young as the guide to conduct, no longer applauded and honored as conducive to the commonwealth. He believes that in the countries advanced in civilization mankind is ready for a change of heart, for the substitution of the motive of fellowship and public service for that of pecuniary self-interest and the craving for riches. He does not thereby demand any fundamental change in human nature. What the establishment of a genuine coöperative commonwealth requires in the way of an advance in morality is no more than that those who have the gift for industrial organization should be, not saints nor ascetics, but as public-spirited in their work, and as modest in their claims to a livelihood, as our quite normally human scientific workers, teachers in schools and colleges, our whole army of civil servants of every degree and kind, municipal officers of every grade, the administrators of the consumers ' coöperative movement, and the officials of the trade union world. And this substitution of the motive of public service for the motive of self-enrichment will be imposed on our consciences by the moral revolution, which will make "living by owning" as shameful as the pauperism of the wastrel; and will, moreover, regard the exceptionally gifted man who insists on extorting from the community the full "rent of his ability" as a mean fellow—as mean as the surgeon who refuses to operate except for the highest fee that he can extract. Even among the socially unscrupulous, the perception that the idle or useless life is neither healthy nor happy; that the amusements substituted for work are mostly devices for pillage by tradesmen; and that the troubles brought by property would be unendurable if the alternative were not poverty and degradation, seems to be growing. However that may be, there is abundant evidence that the necessary tasks of the world will get done, that inventions will be made, improvements introduced and duty performed, even if no man can hope, by persistently getting the better of his fellow-men, to accumulate a fortune. Owing to the advance of science and the growth of professional ethics it is now practicable—it is, indeed, essential if civilization is to be saved from disaster—to substitute for the Court of Profit the twin Courts of Efficiency Audit and Professional Honor.

But even if the evidence on this point were not yet complete, the socialist would still strive for the substitution of fellowship for fighting, of professional ethics for competitive trading, of scientifically audited vital statistics for the test of pecuniary profit, because to him the state of mind that is produced by fellowship and the pursuit of knowledge, the society in which fellowship is the dominant motive, and scientific method the recognized way, is—whether or not it is materially better provided—infinitely preferable to that produced by the economic war of man against man, and the social rancors, national and international, which are the outcome of such warfare.

Here we break off our diagnosis of the decay of capitalist civilization. Though we have been active members of the Labor and Socialist movement for over thirty years, we have never before framed an indictment of the capitalist system. Our time and energy have been devoted to municipal administration, to research into the facts of social organization, and to devising and advocating measures by which the existing profit-making system may be replaced, with the least political friction and the most considerate treatment of "established expectations," by a scientific reorganization of industry as a democratically controlled public service. We have pursued this course because we have no mind for denials that carry no affirmations, for demolitions that provide for no constructions. We have never felt free to preach an ideal until we have found the way towards its realization. But having done our best to survey the path to within sight of the goal, we may, without misgiving or malice, tell capitalism plainly what History will think of it when all the demagogues of our day are dead and forgotten. Those who will take the trouble to follow the rise and growth of the industrial and social institutions which, we believe, should and will gradually supersede the reign of capitalism can do so in our other writings, whether relating to the development of local government, to the organization and functions of trade unionism and the consumers ' coöperative movement, to the increasing elaboration of factory legislation, and the enforcement of the policy of a National Minimum, or to the systematic prevention (as distinguished from the mere relief) of destitution.¹³ And we think we may fairly claim that the careless accusation that socialists avoid details, and fail to work out in practicable projects the alternatives which they desire, does not apply to us, any more than it does to the publications of the British Labor Party and the Fabian Society.

But our former abstention from a moral judgment of capitalism can be justified only by belief that those who are in control of the government and the legislation of the country are aware of the gravity of the social diseases from which we are all suffering, and—what is no less important—of the way in which these evils are regarded by the wage-earners, who constitute, in Britain, four-fifths of the population. Before the Great War there seemed to be a substantial measure of consent that the social order had to be gradually changed, in the direction of a greater equality in material income and personal freedom, and of a steadily increasing participation, in the control of the instruments of wealth-production, of the wage-earning producers and the whole body of consumers. This acquiescence in the progressive development of political and industrial democracy was manifested, during the generation that preceded 1914, not only in the extension of the suffrage to the wage-earning class, the abolition of the absolute veto of the House of Lords and the successive legislative affirmations of the right of free association, but also in the effective democratization of local government; in the steady extension of municipal services; in the systematization and nearly universal extension of factory and mines legislation; in the establishment, for millions of workers, of a legal minimum of wages as of a legal maximum of hours of labor, and last—and perhaps most important of all—in the progressive allocation of a steadily increasing share of the national income to the needs of the children, the sick and infirm, and the aged through old-age pensions and the public services of education, health and recreation. We thought, perhaps wrongly, that this characteristic British acquiescence on the part of a limited governing class in the rising claims of those who had found themselves excluded both from enjoyment and control, would continue and be extended willingly or reluctantly, still further from the political into the industrial sphere; and that whilst progress might be slow, there would at least be no reaction. But apparently the immense destruction of wealth by the war, and the helpless position into which the wage-earners throughout the world have been brought through the unemployment caused by the nature of the Peace, has both incited and encouraged the capitalists and landowners of Britain, as of the United States, some of them excited beyond all prudence by enormous war profits, to make a deliberate attempt to drive back the mass of the population, always on the most plausible commercial grounds, behind the positions gained during the last half century. Not only have wages been drastically reduced and hours of labor increased, even in establishments continuing to make exceptional profits; but the proportion of the national income allocated to such vital communal services as health and education has been diminished in order to reduce the income tax. In every industrial district the overcrowding of families in insanitary and often indecently occupied tenements is becoming more scandalous than even in the days of Lord Shaftesbury. The definite promises of Cabinet Ministers in 1918-19 to nationalize the railways and mines have been shamelessly broken. Instead of extending, according to the policy of the National Minimum, the operations of the highly successful Wages Boards, these bulwarks of the basic wage are being silently attenuated, or their powers undermined. There is in preparation an even more invidious attack on popular liberties; we are threatened, on the one hand, with the reëstablishment of the veto of an effective Second Chamber, expressly in order to resist further "concessions to labor"; and, on the other, with the practical withdrawal from the trade unions of their statutory right to determine by majorities their industrial and political activities. Up and down the country, in factory, shipyard and mine, it is being said and believed that these two measures are intended to "torpedo" both political and industrial democracy—thus driving the wage-earners to resort to "direct action" on an unprecedented scale. Such a counter-revolution, in the long run even more dangerous to those who are engineering it than inhibitive to the oceanic moral tide it vainly dreams of turning back, is made possible, we believe, partly by the ignorance of the British capitalist entrepreneur as to the strength of the case that can be made out against the continuance of his dictatorship, and partly by the blindness of the resentment which drives the proletarian to seek his remedy in the ruin of his economic antagonist and the destruction of the machinery which has enslaved him, rather than in the recognition that there is a better way for both. In an attempt, possibly vain, to make the parties understand their problem and each other better—in the hope that it is not always inevitable that Nature should harden the hearts of those whom she intends to destroy—we offer this little book.

Notes

1. Foreign and Colonial Speeches, by the Rt. Hon. Joseph Chamberlain, M.P., 1897, pp. 101-102, 131-133. ↩
2. The Nation and the Empire: Being a Collection of Speeches and Addresses, by Lord Milner, G.C.B., 1913, p. 140. ↩
3. Modern Egypt, by the Earl of Cromer, vol. i., 1908, pp. 58-9. ↩
4. The Theory of Business Enterprise, by Thorstein Veblen, 1904. One of the most glaring instances of capitalist influence, on Imperial policy has been afforded by the story of the forcing of opium on China. It is in relation to the " Opium War " of 1839-42 that Dr. Arnold wrote to a friend, " Ordinary wars of conquest are to me far less wicked than to go to war in order to maintain smuggling, and that smuggling consisting in the introduction of a demoralizing drug which the Government of China wishes to keep out, and which we, for the lucre of gain, want to introduce by force. " The policy of the Chinese government was expressed by the Emperor's manifesto in 1847. " I cannot, " he said, " prevent the introduction of the flaming poison; keen-seeking and corrupt men will, for profit and sensuality, defeat my wishes; but nothing will induce me to derive a revenue from the vice and misery of my people " (Parliamentary Report, China, 1847, p. 297). The capitalist traders, shipowners and bankers interested in the China trade had their way, and " the drug sold as a poison in England, specially prepared to minister to the weakness of the Chinese, has been poured into their country at the rate of a ton per hour for the twelve hours of every day for some sixty years; whilst, to add to the wrong, the great Dependency which reaps the immediate revenue is united and emphatic in its condemnation of the particular vice from which it draws its profit " (The Imperial Drug Trade, by Joshua Rowntree, 1905, p. 268). The Chinese revolution in 1911 at last brought the system to an end, the British and Indian governments agreeing to stop the export of opium. Unfortunately, with the anarchy into which China has fallen, the capitalists have again begun this lucrative traffic↩
5. The Theory of Business Enterprise, Thorstein Veblen, 1904, pp. 295-6. ↩
6. The Iron Circle: The Future of German Industrial Exports, pp. 46-7. ↩
7. The rapid extension of "Imperialism" is definitely ascribed, by a competent French authority, to the "prodigious expansion" of European industrialism. " The application of steam to industrial purposes, " he says, " put into the hands of the capitalist an incomparable force, greatly multiplying his power, but at the same time as the several nations saw their productive power and their riches increase, they found their wants also increase, so as to become imperious. They presently became aware of the narrowness of the boundaries within which they had formerly lived at their ease; and they demanded for their industries ever more raw materials and ever larger markets. To secure materials, to conquer markets became vital to nations and governments. Economic rivalries took the place of merely political quarrels; and behind the Colonial ambitions there lurked always the imperative requirements of the struggle for existence. It becomes daily more clear that the strength of any State is to be measured entirely by its financial, industrial and commercial resources. The trader has become the monarch of all the world. In olden times the Christian nations appeared to savage peoples in the guise of the Conquistador, clad in armor, marching with the sword in one hand and the Gospels in the other. To-day it is the trader who is the pioneer of civilization. He goes ahead. He precedes the missionary and the soldier. Our utilitarian time finds glory only in the number, the intrepidity and the wealth of its traffickers. The proudest apostle of Divine Right, the Emperor William II., did not shrink, on one memorable occasion, from the following utterances, which would have remarkably surprised his ' unforgettable ancestors ' whose memory he is so fond of recalling. ' Let all my traders out there realize, ' he said, ' that the German Michael has firmly placed upon that land his buckler bearing the German Eagle, in order to assure them of his protection. ' All these territorial rivalries, all these diplomatic quarrels are at bottom nothing but the competitive struggles of rival traders. It was a trading company, the Chartered (South African Company), which came near, a few years ago, setting South Africa in flames. It was another trading company, the Niger, that, more recently, sowed dissension between France and England. It was, they say, a trading syndicate that brought about the Cuban war. Finally, the iniquitous war, which, at the moment of writing, is being waged between handful of stout fighters and the whole force of the British Empire was caused—if London phariseeism will permit to say—by the insatiable appetites of a band of financiers and business men. Cecil Rhodes himself has acknowledged as much with cynical frankness. ' This war, ' he says, 'is a just one, because it has for object the protection of the British flag, which represents to-day the great commercial impulse in the world'. Everywhere the trader is in front; the governments are his obedient servants; and soldiers go to their deaths to fill his coffers " (La Conquête de l'Afrique, par Jean Darcy, 1900, pp. 3-5).↩
8. Bismarck, by C. Grant Robertson, 1918, p. 66. Bismarck may have been the first statesman of the nineteenth century who was frank in his avowal of egoism as the principle of national policy. ↩
9. The universality among other nations of this feeling of resentment against the British Empire had been admitted two years before the war, by a leading British imperialist, successively member of the Coalition and of the Unionist governments of 1920-23. " Meanwhile a great change was taking place in Europe. By 1870 the long struggle for German and Italian unity had been achieved and an internal equilibrium established in Europe which has now lasted for over a generation. A great expansion of European industry followed, and with it a desire for territorial expansion and naval power. But in its efforts to extend its territories or acquire a colonial empire, every power found itself confronted with the British government, either in actual political possession, or jealously watchful of the vested interests of a commerce spread spread all over the world, and acutely alive to the menace implied in the steady closing of every market controlled by protectionist rivals " (Union and Strength, by L. S. Amery, M.P., 1918, p. 91). ↩
10. It is a curious example of vocational bias that so enlightened and public-spirited a man as the late Charles Booth, could deliberately summarize the effect of recurrent and long-continued spells of unemployment on the life and labor of the people in the following way:

    "Looked at from near by, these cycles of depression have a distinctly harmful and even a cruel aspect; but from a more distant point of view, ' afar from the sphere of our sorrow ' they seem less malignant. They might then, perhaps, with a little effort of the imagination, be considered as the olderly beating of a heart causing the blood to circulate—each throb a cycle. Even in the range of our lives, within easy grasp of human experience, whether or not men suffer from these alternations depends on the unit of time on which economic life is based. Those who live from day to day, or from week to week, and even those who live from year to year, may be pinched when trade contracts—some of them must be. There are some victims, but those who are able and willing to provide in times of prosperity for the lean years which seem inevitably to follow, do not suffer at all; and, if the alternations of good and bad times be not too sudden or too great, the community gains not only by the strengthening of character under stress, but also by a direct effect on enterprise. As to character, the effect, especially on wage-earners, is very similar to that exercised on a population by the recurrence of winter as compared enervation of continual summer. ” (The italics are ours.) (Life and Labor of the People in London, by Charles Booth, 1903, Second Series; Industry, vol. 5, pp. 73-4.)↩

11. The Economic Consequences of the Peace, by J. M. Keynes, 1920, p. 19. ↩
12. "Congress Sermon" at the English Church Congress, Times, October 11, 1922. ↩
13. See the pages at the end of this volume. ↩