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Title: Socialism - A Summary and Interpretation of Socialist Principles
Author: Spargo, John, 1876-1966
Language: English
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New York

_All rights reserved_

COPYRIGHT 1906, 1909,

Set up and electrotyped. Published June, 1906. Reprinted
November, 1906; December 1908.

New and revised edition, February, 1909; January, 1910;
May 1912; March, 1913.

Norwood Press
J. S. Cushing Co.--Berwick & Smith Co.
Norwood, Mass., U.S.A.





A new edition of this little volume having been rendered necessary, I
have availed myself of the opportunity thus afforded me by the
publishers to revise it. Some slight revision was necessary to correct
one or two errors which crept unavoidably into the earlier edition. By
an oversight, an important typographical blunder went uncorrected into
the former edition, making the date of the first use of the word
"Socialism" 1835 instead of 1833. That error, I regret to say, has been
subsequently copied into many important publications. Even more
important were some errors in the biographical sketch of Marx, in
Chapter III. These were not due to any carelessness upon the part of the
present writer, but were reproduced from standard works, upon what
seemed to be good authority--that of his youngest daughter and his
intimate friend, the late Wilhelm Liebknecht. It is now known with
certainty that the father of Karl Marx embraced Christianity of his own
free choice, and not in obedience to an official edict.

These and some other minor changes having to be made, I took the time to
rewrite large parts of the volume, making such substantial changes in
it as to constitute practically a new book. The chapter on Robert Owen
has been recast and greater emphasis placed upon his American career and
its influence; in Chapter IV the sketch of the Materialistic Conception
of History has been enlarged somewhat, special attention being given to
the bearing of the theory upon religion. All the rest of the book has
been changed, partly to meet the requirements of many students and
others who have written to me in reference to various points of
difficulty, and partly also to state some of my own ideas more
successfully. I venture to hope that the brief chapter on "Means of
Realization," which has been added to the book by way of postscript,
will, in spite of its brevity, and the fact that it was not written for
inclusion in this volume, prove helpful to some who read the book.

The thanks of the writer are due to all those friends--Socialists and
others--whose kindly efforts made the earlier edition of the book a

  December, 1908.


PREFACE                                                              vii



Changed attitude of the public mind toward Socialism--Growth of
the movement responsible for the change--Unanimity of friends and
foes concerning the future triumph of Socialism--Herbert Spencer's
pessimistic belief--Study of Socialism a civic duty--Nobility of
the word "Socialism"--Its first use--Confusion arising from its
indiscriminate use--"Socialism" and "Communism" in the _Communist
Manifesto_--Unfair tactics of opponents--Engels on the
significance of the word in 1847--Its present significance             1



Utopian Socialism and Robert Owen--Estimates of Owen by Liebknecht
and Engels--His early life--Becomes a manufacturer--The industrial
revolution in England--Introduction of machinery--"Luddite" riots
against machinery--Early riots against machinery--Marx's
views--Owen as manufacturer--As social reformer--The New Lanark
experiment--He becomes a Socialist--The New Harmony
experiment--Abraham Lincoln and New Harmony--Failure of New
Harmony--Owen compared with Saint-Simon and Fourier--Emerson's
tribute to Robert Owen a fair estimate of the Utopists                16



The _Communist Manifesto_ called the birth-cry of modern
Socialism--Conditions in 1848 when it was issued--Communism of the
working class--Weitling and Cabet--Marx's parents become
Christians--Marx and Engels--Religious spirit of Marx--Note upon
the confusion of Marx with Wilhelm Marr--The _Manifesto_ as the
first declaration of a working-class movement--Literary merit of
the _Manifesto_--Its fundamental proposition stated by
Engels--Socialism becomes scientific--The authorship of the
_Manifesto_--Engels' testimony                                        53



Socialism a theory of social evolution--Not economic
fatalism--Leibnitz and the savage--Ideas and progress--Value of
the materialistic conception of history--Foreshadowings of the
theory--What is meant by the term "materialistic
conception"--Results of overemphasis: Engels'
testimony--Application of the theory to religion--Influence of
social conditions upon religious forms--The doctrine of "free
will"--Darwin and Marx--Application of the theory, specific and
general--Columbus and the discovery of America--General view of
historical progress--Antiquity of communism--Coöperation and
competition--Slavery--Serfdom--Class struggles--The rise of
capitalism and the wage system                                        75



A new form of class division arises in the first stage of
capitalism--The second stage of capitalism begins with the great
mechanical inventions--The development of foreign and colonial
trade--Theoretic individualism and practical collectivism--The law
of capitalist concentration formulated by Marx--Competition,
monopoly, socialization--Trustification, interindustrial and
international--Criticisms of the Marxian theory--Engels on the
attempts to make a "rigid orthodoxy" of the Marx theory--The small
producers and traders--Concentration in production--Failure of the
bonanza farms and persistence of the small farms--Other forms of
agricultural concentration--Farm ownership and farm mortgages--The
factory and the farm--The concentration of wealth--European and
American statistics--Concentration of the control of wealth
independent of actual ownership--Growth of immense
fortunes--General summary                                            113



Opposition to the doctrine--Misrepresentations by the opponents of
Socialism--Socialists not the creators of the class
struggle--Antiquity of class struggles--The theory as stated in
the _Communist Manifesto_--Fundamental propositions in the
statement--Slavery the first system of class divisions--Class
divisions in feudalism--Rise of the capitalist class and its
triumph--Inherent antagonism of interests between employer and
employee--Commonality of general interests and antagonism of
special class interests--Adam Smith on class
divisions--Individuals _versus_ classes--Analysis of the class
interests of the population of the United States--Class interests
as they affect thoughts, opinions, and beliefs--Varying ethical
standards of economic classes--Denial of class divisions in
America--Our "untitled nobility"--Class divisions real though not
legally established--They tend to become fixed and
hereditary--Consciousness of class divisions new in
America--Transition from class to class becoming more
difficult--No hatred of individuals involved in the
theory--Socialism _versus_ Anarchism--The labor struggle in the
United States--Not due to misunderstandings, but to antagonism of
interests--The reason for trade unionism--Trade union
methods--Dual exploitation of the workers--Government and the
workers--Capitalistic use of police and military--Judicial
injunctions--"Taff Vale" law--Political rising of the
workers--Triumph of the working class will liberate all mankind
and end class rule                                                   151



First comprehensive statement of the materialist conception of
history by Marx--_La Misère de la Philosophie_, a criticism of
Proudhon--Marx's first essay in economic science--His frank
recognition of the Ricardians--Marx in England becomes familiar
with the work of the Ricardians from whom he is accused of
"pillaging" his ideas--Criticisms of Menger and others--Marx
expelled from Germany and France--Removal to London--The struggle
with poverty--Domestic life--_Capital_ an English work in all
essentials--The Ricardians and their precursors--Superior method
and insight of Marx--The sociological viewpoint in economics--Mr.
W. H. Mallock's criticisms of Marx based upon misrepresentation
and misstatement--Marx on the Gotha Programme of the German Social
Democracy--Marx on the "ability of the directing few"--No ethical
deductions in the Marxian theory--"Scientific Socialism,"
criticisms of the term                                               201



The sociological viewpoint pervades all Marx's work--Commodities
defined--Use-values and economic values--Exchange of commodities
through the medium of money--The labor theory of value in its
crude form--Marx and Benjamin Franklin--Some notable statements by
the classic economists--Scientific development of the labor theory
of value by Marx--"Unique values"--Price and value--Money as a
price-expression and as a commodity--The theory of supply and
demand as determinants of value--The "Austrian" theory of final
utility as the determinant of value--The Marxian theory not
necessarily exclusive of the theory of final, or marginal,
utility--Labor-power as a commodity--Wages, its price, determined
as the prices of all other commodities are--Wherein labor-power
differs from all other commodities--"Surplus Value": why Marx used
the term--The theory stated--The division of surplus value--No
moral judgment involved in the theory--Other theories of the
source of capitalist income--Wherein they fail to solve the
problem--Fundamental importance of the doctrine                      235



Detailed specifications impossible--Principles which must
characterize it--Man's egoism and sociability--Socialism and
Individualism not opposites--The idea of the Socialist state as a
huge bureaucracy--Mr. Anstey's picture and Herbert Spencer's
fear--Justification of this view in Socialist propaganda
literature--Means of production, individual and social--Professor
Goldwin Smith's question--The Socialist ideal of individual
liberty--Absolute personal liberty not possible--Spencer's
abandonment of _laissez faire_--Political organization of
Socialist régime must be democratic--Automatic democracy
unattainable--The need of eternal vigilance--Delegated
authority--The rights of the individual and of society briefly
stated--Private property and industry not incompatible with
Socialism--Public ownership not the end, but only a means to an
end--Economic structure of the Socialist state--Efficiency the
test for private or public industry--The application of democratic
principles to industry--The right to labor guaranteed by society,
and the duty to labor enforced by society--Free choice of
labor--Mode of remuneration--Who will do the dirty work?--The
"abolition of wages"--Approximate equality attainable by free play
of economic law under Socialism--Hoarded wealth--Inheritance--The
security of society against the improvidence of its members--The
administration of justice--Education completely free--The question
of religious education--The state as protector of the
child--Strict neutrality upon religious matters--A maximum of
personal liberty with a minimum of restraint                         277



Impossible to tell definitely how the change will be brought
about--Possible only to point out tendencies making for Socialism,
and to show how the change _can_ be brought about--Marx's
"catastrophe theory" a lapse into Utopian methods of thought--His
deeper thought--Testimony of Liebknecht--Socialism not to be
reached through a _coup de force_--The political changes necessary
for Socialism--Tendencies making for socialization of
industry--Monopolies, coöperative societies, the vast extension of
collectivism within the capitalist system--Confiscation or
compensation?--Change to Socialism to be legal and gradual--Engels
and Marx favored compensation--The widow's savings--Elimination of
unearned incomes--Violence not necessary                             323

INDEX                                                                339








It is not a long time since the kindest estimate of Socialism by the
average man was that expressed by Ebenezer Elliott, "the Corn-Law
Rhymer," in the once familiar cynical doggerel:--

     "What is a Socialist? One who is willing
     To give up his penny and pocket your shilling."

There was another view, brutally unjust and unkind, expressed in
blood-curdling cartoons representing the Socialist as a bomb-throwing
assassin. According to the one view, Socialists were all sordid, envious
creatures, yearning for the

     "Equal division of unequal earnings,"

while the other view represented them as ready to enforce this selfish
demand by means of the cowardly weapons of the assassin.

Both these views are now, happily, well-nigh extinct. There is still a
great deal of misconception of the meaning of Socialism; the ignorance
concerning it which is manifested upon every hand is often
disheartening, but neither of these puerile misrepresentations is
commonly encountered in serious discussion. It is true that the average
newspaper editorial confounds Socialism with Anarchism, often enlisting
the prejudice which exists against the most violent forms of Anarchism
in attacking Socialism, though the two systems of thought are
fundamentally opposed to each other; it is likewise true that Socialists
are not infrequently asked to explain their supposed intention to have a
great general "dividing-up day" for the equal distribution of all the
wealth of the nation. The Chancellor of a great American university
returns from a sojourn in Norway, and naïvely hastens to inform the
world that he has "refuted" Socialism by asking the members of some
poor, struggling sect of Communists what would happen to their scheme of
equality if babies should be born after midnight of the day of the equal
division of wealth!

Recognizing it to be the supreme issue of the age, the Republican Party,
in its national platform,[1] defines Socialism as meaning equality of
ownership as against equality of opportunity, notwithstanding the fact
that every recognized exponent of Socialism would deny that Socialism
means equality of ownership, or that it goes beyond equality of
opportunity; that the voluminous literature of Socialism teems with
unequivocal and unmistakable disavowals of any desire for the periodic
divisions of property and wealth which alone could make equality of
ownership possible for brief periods.

Still, when all this has been said, it must be added that these
criticisms do not represent the attitude of the mass of people toward
the Socialist movement to the same extent as they once did. In serious
discussions of the subject among thinking people it is becoming quite
rare to encounter either of the two criticisms named. Most of those who
seriously and honestly discuss the subject know that modern Socialism
comprehends neither assassination nor the equal division of wealth. The
enormous interest manifested in Socialism during recent years and the
steady growth of the Socialist vote throughout the world bear witness to
the fact that the views expressed in the satirical distich of the poet's
fancy and the blood-curdling cartoon of the artist's invention are no
longer the potent appeals to prejudice they once were.

The reason for the changed attitude of the public toward the Socialist
movement and the Socialist ideal lies in the growth of the movement
itself. There are many who would change the order of this proposition
and say that the growth of the Socialist movement is a result of the
changed attitude of the public mind toward it. In a sense, both views
are right. Obviously, if the public mind had not revised its judgments
somewhat, we should not have attained our present strength and
development; but it is equally obvious that if we had not grown, if we
had remained the small and feeble band we once were, the public mind
would not have revised its judgments much, if at all. It is easy to
enlist prejudice against a small body of men and women when they have no
powerful influence, and to misrepresent and vilify them.

But it is otherwise when that small body has grown into a great body
with far-reaching influence and power. So long as the Socialist movement
in America consisted of a few poor workingmen in two or three of the
largest cities, most of them foreigners, it was very easy for the
average man to accept as true the wildest charges brought against them.
But when the movement grew and developed a powerful organization, with
branches in almost every city, and a well-conducted press of its own, it
became a very different matter. The sixteen years from 1888 to 1904 saw
the Socialist vote in the United States grow steadily from 2068 in the
former year to 442,402 in the latter. Europe and America together had in
1870 only about 30,000 votes, but by 1906 the number had risen to
considerably over 7,000,000. These figures constitute a vital challenge
to the thoughtful and earnest men and women of the world.

It is manifestly impossible for a great world-wide movement, numbering
its adherent by millions, and having for its advocates many of the
foremost thinkers, artists, and poets of the world, to be based upon
either sordid selfishness or murderous hate and envy. If that were true,
if it were possible for such a thing to be true, the most gloomy
forebodings of the pessimist would fall far short of the real measure of
Humanity's impending doom. It is estimated that no less than thirty
million adults are at present enrolled in the ranks of the Socialists
throughout the world, and the number is constantly increasing. This vast
army, drawn from every part of the civilized world, comprising men and
women of all races and creeds, is not motivated by hate or envy, but by
a consciousness that in their hands and the hands of their fellows rests
the power to win greater happiness for themselves. Incidentally, their
unity for this purpose is perhaps the greatest force in the world to-day
making for international peace.

Still, notwithstanding the millions enlisted under the banner of
Socialism, the word is spoken by many with the pallid lips of fear, the
scowl of hate, or the amused shrug of contempt; while in the same land,
people of the same race, facing the same problems and perils, speak it
with glad voices and hopelit eyes. Many a mother crooning over her babe
prays that it may be saved from the Socialism to which another, with
equal mother love, looks as her child's heritage and hope. And with
scholars and statesmen it is much the same. With wonderful unanimity
agreeing that, in the words of Herbert Spencer, "Socialism will come
inevitably, in spite of all opposition," they yet differ in their
estimates of its character and probable effects upon the race quite as
much as the unlearned. One welcomes and another fears; one envies the
unborn generations, another pities. To one the coming of Socialism means
the coming of Human Brotherhood, the long, long quest of Humanity's
choicest spirits; to another it means the enslavement of the world
through fear.

Many years ago Herbert Spencer wrote an article on "The Coming Slavery,"
which conveyed the impression that the great thinker saw what he thought
to be signs of the inevitable triumph of Socialism. All over the world
Socialists were cheered by this admission from their implacable enemy.
In this connection it is worthy of note that Spencer continued to
believe in the inevitability of Socialism. In October, 1905, a
well-known Frenchman, M. G. Davenay, visited Mr. Spencer and had a long
conversation with him on several subjects, Socialism among them. Soon
after his return, he received a letter on the subject from Mr. Spencer,
written in French, which was published in the Paris _Figaro_ a few days
after Mr. Spencer's death in December, 1905, two months or thereabouts
from the time of the interview which called it forth.[2] After some
brief reference to his health, Mr. Spencer wrote: "The opinions I have
delivered here before you, and which you have the liberty to publish,
are briefly these: (1) Socialism will triumph inevitably, in spite of
all opposition; (2) its establishment will be the greatest disaster
which the world has ever known; (3) sooner or later, it will be brought
to an end by a military despotism."

Anything more terrible than this black pessimism which clouded the
latter part of the life of the great thinker, it would be difficult to
imagine. After living his long life of splendid service to the cause of
intellectual progress, and studying as few men have ever done the
history of the race, he went down to his grave fully believing that the
world was doomed to inevitable disaster. How different from the
confidence of the poet,[3] foretelling:--

     "A wonderful day a-coming when all shall be better than well."

The last words of the great French Utopist, Saint-Simon, were, "The
future is ours!" And thousands of times his words have been echoed by
those who, believing equally with Herbert Spencer that Socialism must
come, have seen in the prospect only the fulfillment of the age-long
dream of Human Brotherhood. Men as profound as Spencer, and as sincere,
rejoice at the very thing which blanched his cheeks and filled his heart
with fear.

There is, then, a widespread conviction that Socialism will come and, in
coming, vitally affect for good or ill every life. Millions of earnest
men and women have enlisted themselves beneath its banner in various
lands, and their number is steadily growing. In this country, as in
Europe, the spread of Socialism is one of the most evident facts of the
age, and its study is therefore most important. What does it mean, and
what does it promise or threaten, are questions which civic duty
prompts. The day is not far distant when ignorance of Socialism will be
regarded as a disgrace, and neglect of it a civic wrong. No man can
faithfully discharge the responsibilities of his citizenship until he is
able to give an answer to these questions, to meet intelligently the
challenge of Socialism to the age.


The word "Socialism" is admittedly one of the noblest and most inspiring
words ever born of human speech. Whatever may be thought of the
principles for which it is the accepted name, or of the political
parties which contend for those principles, no one can dispute the
beauty and moral grandeur of the word itself. I refer not merely, of
course, to its etymology, but rather to its spiritual import. Derived
from the Latin word, _socius_, meaning a comrade, it is, like the word
"mother," for instance, one of those great universal speech symbols
which find their way into every language.

Signifying as it does faith in the comradeship of man as the basis of
social existence, prefiguring a social state in which there shall be no
strife of man against man, or nation against nation, it is a verbal
expression of a great ideal, man's loftiest aspirations crystallized
into a single word. The old Hebrew prophet's dream of a
world-righteousness that shall give peace, when nations "shall beat
their swords into plowshares, and their spears into pruning-hooks,"[4]
and the Angel-song of Peace and Goodwill in the legend of the Nativity,
mean no more than the word "Socialism" in its best usage means. Plato,
spiritual son of the Socrates who for truth's sake drained the hemlock
cup to its dregs, dreamed of such social peace and unity, and the line
of those who have seen the same vision of a love-welded world has never
been broken: More and Campanella, Saint-Simon and Owen, Marx and Engels,
Morris and Bellamy--and the end of the prophetic line is not yet.

But if the dream, the hope itself, is old, the word is comparatively
new. It is hard to realize that the word which means so much to
countless millions of human beings, and which plays such a part in the
vital discussions of the world, in every civilized country, is no older
than many of those whose lips speak it with reverence and hope. Yet such
is the fact. Because it will help us to a clearer understanding of
modern Socialism, and because, too, it is little known, notwithstanding
its intensely interesting character, let us linger awhile over that page
of history which records the origin of this noble word.

Some years ago, anxious to settle, if possible, the vexed question of
the origin and first use of the word "Socialism," the present writer
devoted a good deal of time to an investigation of the subject, spending
much of it in a careful survey of all the early nineteenth-century
radical literature. It soon appeared that the generally accepted account
of its introduction, by the French writer, L. Reybaud, in 1840, was
wrong. Indeed, when once fairly started on the investigation, it seemed
rather surprising that the account should have been accepted,
practically without challenge, for so long. Finally the conclusion was
reached that an anonymous writer in an English paper was the first to
use the word in print, the date being August 24, 1833.[5] Since that
time an investigation of a commendably thorough nature has been made by
three students of the University of Wisconsin,[6] with the result that
they have been unable to find any earlier use of the word. It is
somewhat disappointing that after thus tracing the word back to what may
well be its first appearance in print, it should be impossible to
identify its creator.

The letter in which the term is first used is signed "A Socialist," and
it is quite evident that the writer uses it as a synonym for the
commonly used term "Owenite," by which the disciples of Robert Owen were
known. It is most probable that Owen himself had used the word, and, to
some extent, made it popular; and that the writer of the letter had
heard "our dear social father," as Owen was called, use it, either in
some of his speeches or in conversation. This is the more likely as Owen
was fond of inventing new words. At any rate, one of Owen's associates,
now dead, told the present writer that Owen often specifically claimed
to have used the word at least ten years before it was adopted by any
other writer.

The word gradually became more familiar in England. Throughout the years
1835-1836, in the pages of Owen's paper, _The New Moral World_, there
are many instances of the word occurring. The French writer, Reybaud, in
his "Reformateurs Modernes," published in 1840, made the term equally
familiar to the reading public of Continental Europe. By him it was
used to designate the teachings not merely of Owen and his followers,
but those of all social reformers and visionaries--Saint-Simon, Charles
Fourier, Louis Blanc, and others. By an easy transition, it soon came
into general use as designating all altruistic visions, theories, and
experiments, from the "Republic" of Plato onward through the centuries.

In this way much confusion arose. The word became too vague and
indefinite to be distinctive. It was applied--frequently as an
epithet--indiscriminately to persons of widely differing, and often
conflicting, views. Every one who complained of social inequalities,
every dreamer of social Utopias, was called a Socialist. The
enthusiastic Christian, pleading for a return to the faith and practices
of primitive Christianity, and the aggressive atheist, proclaiming
religion to be the bulwark of the world's wrongs; the State worshiper,
who would extol Law, and spread the net of government over the whole of
life, and the iconoclastic Anarchist, who would destroy all forms of
social authority, have all alike been dubbed Socialists, by their
friends no less than by their opponents.

The confusion thus introduced has had the effect of seriously
complicating the study of Socialism from the historical point of view.
Much that one finds bearing the name of Socialism in the literature of
the middle of the nineteenth century, for example, is not at all
related to Socialism as that term is understood to-day. Thus the
Socialists of the present day, who do not advocate Communism, regard as
a classic presentation of their views the famous pamphlet by Karl Marx
and Friederich Engels, _The Communist Manifesto_. They have circulated
it by millions of copies in practically all the languages of the
civilized world. Yet throughout it speaks of "Socialists" with
ill-concealed disdain, and always in favor of Communism and the
Communist Party. The reason for this is clearly explained by Engels
himself in the preface written by him for the English edition, but that
has not prevented many an unscrupulous opponent of Socialism from
quoting the _Communist Manifesto_ of Marx and Engels against the
Socialists of the Marx-Engels school.[7] In like manner, the utterances
and ideas of many of those who formerly called themselves Socialists
have been quoted against the Socialists of to-day, notwithstanding that
it was precisely on account of their desire to repudiate all connection
with, and responsibility for, such ideas that the founders of the modern
Socialist movement took the name "Communists."

Nothing could be clearer than the language in which Engels explains why
the name Communist was chosen, and the name Socialist discarded. He
says: "Yet, when it (the _Manifesto_) was written, we could not have
called it a _Socialist Manifesto_. By Socialists, in 1847, were
understood, on the one hand, the adherents of the various Utopian
systems: Owenites in England, Fourierists in France, both of these
already reduced to the position of mere sects, and gradually dying out;
on the other hand, the most multifarious social quacks, who, by all
manner of tinkering, professed to redress, without any danger to capital
and profit, all sorts of social grievances; in both cases men outside of
the working-class movement, and looking rather to the 'educated' classes
for support. Whatever portion of the working class had become convinced
of the insufficiency of mere political revolution and had proclaimed the
necessity of a total social change, that portion, then, called itself
Communist. It was a crude, rough-hewn, purely instinctive sort of
Communism; still, it touched the cardinal point and was powerful enough
among the working class to produce the Utopian Communism, in France, of
Cabet, and in Germany, of Weitling. Thus Socialism was, in 1847, a
middle-class movement; Communism a working-class movement. Socialism
was, on the Continent at least, 'respectable'; Communism was the very
opposite. And as our notion, from the very beginning, was that the
'emancipation of the working class must be the act of the working class
itself,' there could be no doubt as to which of the names we must take.
Moreover, we have ever since been far from regretting it."[8]

There is still, unfortunately, much misuse of the word "Socialism," even
by some accredited Socialist exponents. Writers like Tolstoy, Ibsen,
Zola, and many others, are constantly referred to as Socialists, when,
in fact, they are nothing of the sort. Still, the word is now pretty
generally understood as defined by the Socialists--not the "Socialists"
of sixty years ago, who were mostly Communists, but the Socialists of
to-day, whose principles find classic expression in the _Communist
Manifesto_, and to the attainment of which they have directed their
political parties and programmes. In the words of Professor Thorstein
Veblen: "The Socialism that inspires hopes and fears to-day is of the
school of Marx. No one is seriously apprehensive of any other so-called
Socialistic movement, and no one is seriously concerned to criticise or
refute the doctrines set forth by any other school of 'Socialists.'"[9]


[1] Republican National Platform, 1908.

[2] I quote the English translation from the London _Clarion_, December
18, 1905.

[3] William Morris.

[4] Isaiah ii. 4.

[5] See _Socialism and Social Democracy_, by John Spargo. _The Comrade_,
Vol. II, No. 6, March, 1903.

[6] In _The International Socialist Review_, Vol. VI, No. 1, July, 1905.

[7] As an instance of this I note the following example: "No severer
critic of Socialists ever lived than Karl Marx. No one more bitterly
attacked them and their policy toward the trade unions than he.... And
yet Socialists regard him as their patron saint." Mr. Samuel Gompers, in
_The American Federationist_, August, 1905.

[8] Preface to _The Communist Manifesto_, by F. Engels, Kerr edition,
page 7.

[9] _Quarterly Journal of Economics._




As a background to modern, or scientific, Socialism there is the
Socialism of the Utopians, which the authors of the _Manifesto_ so
severely criticised. It is impossible to understand the modern Socialist
movement, the Socialism which is rapidly becoming the dominant issue in
the thought and politics of the world, without distinguishing sharply
between it and the Utopian visions which preceded it. Failure to make
this distinction is responsible for the complete misunderstanding of the
Socialism of to-day by many earnest and intelligent persons.

It is not necessary that we study the Utopian movements which flourished
and declined prior to the rise of scientific Socialism in detail. It
will be sufficient if we consider the Utopian Socialism of Owen, which
is Utopian Socialism at its best and nearest approach to the modern
movement. Thus we shall get a clear view of the point of departure which
marked the rise of the later scientific movement with its revolutionary
political programmes. Incidentally, also, we shall get a view of the
great and good Robert Owen, whom Liebknecht, greatest political leader
of the movement, has called, "By far the most embracing, penetrating,
and practical of all the harbingers of scientific Socialism."[10]

Friederich Engels, a man not given to praising overmuch, has spoken of
Owen with an enthusiasm which he rarely showed in his descriptions of
men. He calls him, "A man of almost sublime and childlike simplicity of
character," and declares, "Every social movement, every real advance in
England on behalf of the workers, links itself on to the name of Robert
Owen."[11] And even this high praise from the part-author of _The
Communist Manifesto_ who for so many years was called the "Nestor of the
Socialist movement," falls short, because it does not recognize the
great influence of the man in the United States at a most important
period of our history.

Robert Owen was born of humble parentage, in a little town in North
Wales, on the fourteenth day of May, 1771. A most precocious child, at
seven years of age, so he tells us in his "Autobiography," he had
familiarized himself with Milton's "Paradise Lost," and by the time he
was ten years old he had grappled with the ages-old problems of Whence
and Whither and become a skeptic! It is doubtful whether his
"skepticism" really consisted of anything more than the consciousness
that there were apparent contradictions in the Bible, a discovery which
many a precocious lad has made at quite as early an age, and the failure
of the usual theological subterfuges to satisfy a boy's frank spirit.
Still, it is worthy of note as indicating his inquiring spirit.

The great dream of his childhood was that he might become an educated
man. He thirsted for knowledge and wanted above all things a university
education. A passion for knowledge was the controlling force of his
life. But his parents were too poor to gratify his desire for an
extensive education. He was barely ten years old when his scanty
schooling ended, and he set out to fight the battle of life for himself
in London.

He was apprenticed to a draper, named McGuffeg, who seems to have been a
rather superior type of man. From a small peddling business he had built
up one of the largest and wealthiest establishments in that part of
London, catering to the wealthy and the titled nobility. Above all,
McGuffeg was a man of books, and in his well-stocked library young Owen
could read several hours each day, and thus make up in a measure for his
early lack of educational opportunities. During the three years of his
apprenticeship he read prodigiously, and laid the foundations of that
literary culture which characterized his whole life and added
tremendously to his power.

This is not in any sense a biographical sketch of Robert Owen.[12] If it
were, the story of the rise of this poor, strange, strong lad, from
poverty to the very pinnacle of industrial and commercial power and
fame, as one of the leading manufacturers of his day, would lead through
pathways of romance as wonderful as any in our biographical literature.
We are concerned, however, only with his career as a social reformer and
the forces which molded it. And that, too, has its romantic side.


The closing years of the eighteenth century marked the beginning of a
great and far-reaching industrial revolution. The introduction of new
mechanical inventions enormously increased the productive powers of
England. In 1770 Hargreaves patented his "spinning jenny," and in the
following year Arkwright invented his "water frame," a patent spinning
machine which derived its name from the fact that it was worked by water
power. Later, in 1779, Crompton invented the "mule," which was really a
combination of the principles of both machines. This was a long step
forward, and greatly facilitated the spinning of the raw material into
yarn. The invention was, in fact, a revolution in itself. Like so many
other great inventors, Crompton died in poverty.

Even now, however, the actual weaving had to be done by hand. Not until
1785, when Dr. Cartwright, a parson, invented a "power loom," was it
deemed possible to weave by machinery. Cartwright's invention, coming in
the same year as the general introduction of Watt's steam engine in the
cotton industry, made the industrial revolution. Had the revolution come
slowly, had the inventors of the new industrial processes been able to
accomplish that, it is most probable that much of the misery of the
period would have been avoided. As it was, terrible poverty and hardship
attended the birth of the new industrial order. Owing to the expense of
introducing the machines, and the impossibility of competing with them
by the old methods of production, the small manufacturers themselves
were forced to the wall, and their misery, compelling them to become
wage-workers in competition with other already far too numerous
wage-workers, added greatly to the woe of the time. William Morris's
fine lines, written a hundred years later, express vividly what many a
manufacturer must have felt at that time:--

     "Fast and faster our iron master,
     The thing we made, forever drives."

But perhaps the worst of all the results of the new régime was the
destruction of the personal relations which had hitherto existed between
the employers and their employees. No attention was paid to the
interests of the latter. The personal relation was forever gone, and
only a hard, cold cash nexus remained. Wages went down at an alarming
rate, as might be expected; the housing conditions became simply
inhuman. Now it was discovered that a child at one of the new looms
could do more than a dozen men had done under the old conditions, and a
tremendous demand for child workers was the result. At first, as H. de
B. Gibbins[13] tells us, there was a strong repugnance on the part of
parents to sending their children into the factories. It was, in fact,
considered a disgrace to do so. The term "factory girl" was an insulting
epithet, and it was impossible for a girl who had been employed in a
factory to obtain other employment. She could not look forward to
marriage with any but the very lowest of men, so degrading was factory
employment considered to be. But the manufacturers had to get children
somehow, and they got them. They got them from the workhouses.
Pretending that they were going to apprentice them to a trade, they
arranged with the overseers of the poor regular days for the inspection
of these workhouse children. Those chosen were conveyed to their
destination, packed in wagons or canal boats, and from that moment were
doomed to the most awful form of slavery.

"Sometimes regular traffickers would take the place of the
manufacturer," says Gibbins,[14] "and transfer a number of children to a
factory district, and there keep them, generally in some dark cellar,
till they could hand them over to a mill owner in want of hands, who
would come and examine their height, strength, and bodily capacities,
exactly as did the slave owners in the American markets. After that the
children were simply at the mercy of their owners, nominally as
apprentices, but in reality as mere slaves, who got no wages and whom it
was not worth while even to feed and clothe properly, because they were
so cheap and their places could be so easily supplied. It was often
arranged by the parish authorities, in order to get rid of imbeciles,
that one idiot should be taken by the mill owner with every twenty sane
children. The fate of these unhappy idiots was even worse than that of
the others. The secret of their final end has never been disclosed, but
we can form some idea of their awful sufferings from the hardships of
the other victims to capitalist greed and cruelty. The hours of their
labor were only limited by exhaustion, after many modes of torture had
been unavailingly applied to force continued work. Children were often
worked sixteen hours a day, by day and by night."

Terrible as this summary is, it does not equal in horror the account
given by "Alfred,"[15] in his "History of the Factory System": "In
stench, in heated rooms, amid the constant whirl of a thousand wheels,
little fingers and little feet were kept in ceaseless action, forced
into unnatural activity by blows from the heavy hands and feet of the
merciless overlooker, and the infliction of bodily pain by instruments
of punishment invented by the sharpened ingenuity of insatiable
selfishness." The children were fed upon the cheapest and coarsest food,
often the same as that served to their master's pigs. They slept by
turns, and in relays, in filthy beds that were never cool. There was
often no discrimination between the sexes, and disease, misery, and vice
flourished. Some of these miserable creatures would try to run away, and
to prevent them, those suspected had irons riveted on their ankles, with
long links reaching up to the hips, and were compelled to sleep and work
with them on, young women and girls, as well as boys, suffering this
brutal treatment. The number of deaths was so great that burials took
place secretly, at night, lest an outcry should be raised. Many of the
children committed suicide.

These statements are so appalling that, as Mr. R. W. Cooke-Taylor
says,[16] they would be "absolutely incredible" were they not fully
borne out by evidence from other sources. It is not contended, of
course, that conditions in all factories were as bad as those described.
But it must be said emphatically that there were worse horrors than any
here quoted, and equally emphatically that the very best factories were
only a little better than those described. Take, for instance, the
account given by Robert Owen of the conditions which obtained in the
"model factory" of the time, the establishment at New Lanark, Scotland,
owned by Mr. David Dale, where Owen himself was destined to introduce so
many striking reforms. Owen assumed control of the New Lanark mills on
the first day of the year 1800. In his "Autobiography,"[17] he gives
some account of the conditions which he found there, in the "best
regulated factory in the world," at that time. There were, says Owen,
about five hundred children employed, who "were received as early as six
years old, the pauper authorities declining to send them at any later
age." They worked from six in the morning until seven in the evening,
and _then their education began_. They hated their slavery, and many
absconded. Many were dwarfed and stunted in stature, and when they were
through their "apprenticeship," at thirteen or fifteen years of age,
they commonly went off to Glasgow or Edinburgh, with no guardians,
ignorant and ready--"admirably suited," is Owen's phrase--to swell the
great mass of vice and misery in the towns. The people in New Lanark
lived "almost without control, in habits of vice, idleness, poverty,
debt, and destitution. Thieving was general." With such conditions
existing in a model factory, under a master whose benevolence was
celebrated everywhere, it can be very readily believed that conditions
elsewhere must have been abominable.

As a result of the appalling poverty which developed, it soon became
necessary for poor parents to permit their children to go into the
factories. The mighty machines were far too powerful for the prejudices
of parental hearts. Child wage-workers became common. They were
subjected to little better conditions than the parish apprentices had
been; in fact, they were often employed alongside of them. Fathers were
unemployed and frequently took meals to their little ones who were at
work--a condition which sometimes obtains in some parts of the United
States even to this day. Michael Sadler, a member of the House of
Commons and a fearless champion of the rights of the poor and
oppressed, described this aspect of the evil in touching verse.[18]

During all this time, let it be remembered, the English philanthropists,
and among them many capitalists, were agitating against negro slavery in
Africa and elsewhere, and raising funds for the emancipation of the
slaves. Says Gibbins,[19] "The spectacle of England buying the freedom
of black slaves by riches drawn from the labor of her white ones affords
an interesting study for the cynical philosopher."

As we read the accounts of the distress which followed upon the
introduction of the new mechanical inventions, it is impossible to
regard with surprise or with condemnatory feelings, the riots of the
misguided "Luddites" who went about destroying machinery in their blind
desperation. Ned Lud, after whom the Luddites were named, was an idiot,
but wiser men, finding themselves reduced to abject poverty through the
introduction of the giant machines, could see no further than he. It was
not to be expected that the masses should understand that it was not the
machines, but the institution of their private ownership, and use for
private gain, that was wrong. And just as we cannot regard with surprise
the action of the Luddites in destroying machinery, it is easy to
understand how the social unrest of the time produced Utopian movements
with numerous and enthusiastic adherents.

The Luddites were not the first to make war upon machinery. In 1758, for
example, Everet's first machine for dressing wool, an ingenious
contrivance worked by water power, was set upon by a mob and reduced to
ashes. From that time on similar outbreaks occurred with more or less
frequency; but it was not until 1810 that the organized bodies of
Luddites went from town to town, sacking factories and destroying the
machines in their blind revolt. The contest between the capitalist and
the wage-worker, which, as Karl Marx says, dates back to the very origin
of capital, took on a new form when machinery was introduced.
Henceforth, the worker fights not only, nor even mainly, against the
capitalist, but against the machine, as the material basis of capitalist
exploitation. This is a distinct phase of the struggle of the
proletariat everywhere.

In the sixteenth century the ribbon loom, a machine for weaving ribbon,
was invented in Germany. Marx quotes an Italian traveler, Abbé
Lancellotti, who wrote in 1579, as follows: "Anthony Müller, of Danzig,
saw about fifty years ago, in that town, a very ingenious machine, which
weaves four to six pieces at once. But the mayor, being apprehensive
that this invention might throw a large number of workmen on the
streets, caused the inventor to be secretly strangled or drowned."[20]
In 1629 this ribbon loom was introduced into Leyden, where the riots of
the ribbon weavers forced the town council to prohibit it. In 1676 its
use was prohibited in Cologne, at the same time that its introduction
was causing serious disturbances in England. "By an imperial Edict of
the 19th of February, 1685, its use was forbidden throughout all
Germany. In Hamburg it was burned in public, by order of the Senate. The
Emperor Charles VI, on the 9th of February, 1719, renewed the Edict of
1685, and not till 1765 was its use openly allowed in the Electorate of
Saxony. This machine, which shook all Europe to its foundations, was in
fact the precursor of the mule and power loom, and of the industrial
revolution of the eighteenth century. It enabled a totally inexperienced
boy to set the whole loom, with all its shuttles, in motion by simply
moving a rod backward and forward, and in its improved form produced
from forty to fifty pieces at once."[21]

The introduction of machinery has universally caused the workers to
revolt. Much futile denunciation has been poured upon the blind, stupid
resistance of the workers, but in view of the misery and poverty which
they have suffered, it is impossible to judge them harshly. Their
passionate, futile resistance to the irresistible moves to pity rather
than to condemnation. As Marx justly says, "It took both time and
experience before the work people learned to distinguish between
machinery and its employment by capital, and to direct their attacks,
not against the material instruments of production, but against the mode
in which they are used."[22]


Under the new industrial régime, Robert Owen, erstwhile a poor draper's
apprentice, soon became one of the most successful manufacturers in
England. At eighteen years of age we find him entering into the
manufacture of the new cotton-spinning machines, with a borrowed capital
of $500. His partner was a man named Jones, and though the enterprise
was successful from a financial point of view, the partnership proved to
be most disagreeable. Accordingly it was dissolved, Owen taking three of
the "mules" which they were making as a reimbursement for his
investment. With these and some other machinery, Owen entered the cotton
manufacturing industry, employing at first only three men. He made $1500
as his first year's profit.

Erelong Owen ceased manufacturing upon his own account, and became
superintendent of a Manchester cotton mill, owned by a Mr. Drinkwater,
and employing some five hundred work people. A most progressive man, in
his new position Owen was always ready to introduce new machinery, and
to embark upon experiments, with a view to improving the quality of the
product of the factory.[23] In this he was so successful that the goods
manufactured at the Drinkwater mill soon commanded a fifty per cent
advance above the regular market prices. Drinkwater, delighted at
results like these, made Owen his partner. Thus when he was barely
twenty years of age Owen had secured an eminent position among the
cotton manufacturers of the time. It is interesting to recall that Owen,
in that same year, 1791, used the first cotton ever brought into England
from the United States. "American sea island cotton," as it was called
from the fact that it was then grown only upon the islands near the
southern coast of the United States, was not believed to be of any value
for manufacture on account, chiefly, of its poor color. But when a
cotton broker named Spear received three hundred pounds of it from an
American planter, with the request that he get some competent spinner to
test it, Owen, with characteristic readiness, undertook the test and
succeeded in making a much finer product than had hitherto been made
from the French cotton, though inferior to it in color. That was the
first introduction of American cotton, destined soon to furnish English
cotton mills with the greater part of their raw material.

Owen did not long remain with Mr. Drinkwater. He accepted another
profitable partnership in Manchester, and it was at this time that he
became active in social reform work. As a member of an important
literary and philosophical society, he was thrown much into the company
of men distinguished in all walks of life, one of his friends and
admirers being the poet Coleridge. Here he began that agitation which
led to the passing of the very first factory act of Sir Robert Peel, in
1802. The suffering of the children moved his great humane heart to
pity. He well knew that his own wealth and the wealth of his
fellow-capitalists had been purchased at a terrible cost in child life.
He was only a philanthropist as yet; he saw only the pitiful waste of
life involved, and sought to impress men of wealth with what he felt.
His mind was constantly occupied with plans for practical, constructive
philanthropy upon a scale never before attempted.

On the first day of the nineteenth century, Owen entered upon the
wonderful philanthropic career at New Lanark, which attracted universal
attention, and ultimately led him to those social experiments and
theories which won for him the title of "Father of Modern Socialism."
We have already seen what the conditions were in the "model factory"
when Owen assumed control. His influence was at once directed to the
task of ameliorating the condition of the work people. He shortened the
hours of labor, introduced sanitary reforms, protected the people
against the exploitation of traders through a vicious credit system,
opening a store and supplying them with goods at cost, and established
infant schools, the first of their kind, for the care and education of
children from two years of age and upward. Still, the workers themselves
were suspicious of this man who, so different from other employers, was
zealous in doing things for them. He really knew nothing of the working
class, and it had never occurred to him that they might do anything for
themselves. New Lanark under Owen was, to use the phrase which Mr. Ghent
has adopted from Fourier, "a benevolent feudalism." Owen complains
pathetically, "Yet the work people were systematically opposed to every
change which I proposed, and did whatever they could to frustrate my

Opportunity to win the affection and confidence of his employees came to
Owen at last, and he was not slow to embrace it. In 1806 the United
States, in consequence of a diplomatic rupture with England, placed an
embargo upon the shipment of raw cotton to that country. Everywhere
mills were shut down, and there was the utmost distress in consequence.
The New Lanark mills, in common with most others, were shut down for
four months, during which time Owen paid every worker his or her wages
in full, at a cost of over $35,000. Forever afterward he enjoyed the
love and trust of his work people. In spite of all his seemingly
reckless expenditure upon purely philanthropic work, the mills yielded
an enormous profit. But Owen was constantly in conflict with his
business associates, who sought to restrict his philanthropic
expenditures, with the result that he was compelled again and again to
change partners, always securing their interests and returning them big
profits upon their investments, until finally, in 1829, he left New
Lanark altogether.

During twenty-nine years he had carried on the business with splendid
commercial success and at the same time attracted universal attention to
New Lanark as the theater of the greatest experiments in social
regeneration the modern world had known. Every year thousands of persons
from all parts of the world, many of them statesmen and representatives
of the crowned heads of Europe, visited New Lanark to study these
experiments, and never were they seriously criticised or their success
challenged. It was a wonderful achievement. Had Owen's life ended in
1829, he must have taken rank in history as one of the truly great men
of the nineteenth century.


Let us now consider briefly the forces which led this gentle
philanthropist onward to the goal of Communism. His experiences at New
Lanark had convinced him that human character depends in large part
upon, and is shaped by, environment. Others before Owen had perceived
this, but he must ever be regarded as one of the pioneers in the spread
of the idea, one of the first to give it definite form and to
demonstrate its truth upon a large scale. In the first of those keen
"Essays on the Formation of Human Character," in which he recounts the
results of his New Lanark system of education, Owen says, "Any general
character from the best to the worst, from the most ignorant to the most
enlightened, may be given to any community, even to the world at large,
by the application of proper means; which means are to a great extent at
the command and under the control of those who have influence in the
affairs of men."

We may admit that there is a good deal of overemphasis in this
statement, but the doctrine itself does not seem strange or sensational
to-day. It might be promulgated in any fashionable church, or in any
ministerial conference, without exciting more than a languid, passing
interest. But in Owen's time it was far otherwise. Such a doctrine
struck at the very roots of current theology and all that organized
Christianity consciously stood for. It denied the doctrine of the
freedom of the will, upon which the elaborate theology of the church
rested. No wonder, then, that it brought much bitter denunciation upon
the heads of its promulgators. A poet of the period, in a poem dedicated
to Owen, aptly expresses the doctrine in somewhat prosaic verse:--

     "We are the creatures of external things,
     Acting on inward organs, and are made
     To think and do whate'er our tutors please.
     What folly, then, to punish or reward
     For deeds o'er which we never held a curb!
     What woeful ignorance, to teach the crime
     And then chastise the pupil for his guilt!"[25]

Owen learned other things at New Lanark besides the truth that character
is formed largely by environment. Starting out with no other purpose
than to ameliorate the conditions of his work people, he realized before
many years had passed that he could never do for them the one essential
thing--secure their real liberty. "The people were slaves of my mercy,"
he writes.[26] He saw, though but dimly at first, that no man could be
free who depended upon another for the right to earn his bread, no
matter how good the bread-master might be. The hopelessness of expecting
reform from the manufacturers themselves was painfully forced upon him.
First of all, there was the bitter hostility of those of his class who
had no sympathy with his philanthropic ideas, manifested from the
beginning of his agitation at Manchester. Then there was the incessant
conflict with his own associates, who, though they represented the
noblest and best elements of the manufacturing class, constantly opposed
him and regarded as dangerous and immoral his belief in the inherent
right of every child to the opportunities of sound physical, mental, and
moral culture. Class consciousness had not yet become a recognized term
in sociological discussions, but class consciousness, the instinctive
conformity of thought and action with class interests, was a fact which
confronted Owen at every step.

The Luddite riots of 1810-1811 awakened England to the importance of the
labor question, and Owen, who since 1805 had been devoting much time to
its study, secured a wider audience and a much more serious hearing than
ever before. Then came the frightful misery of 1815, due to the crisis
which the end of the great war produced. Every one seemed to think that
when the war was over and peace restored, there would be a tremendous
increase in prosperity. What happened was precisely the opposite; for a
time at least things were immeasurably worse than before. Peace did not
bring with it plenty, but penury.

Owen, more clearly than any other man of the time, explained the real
nature of the crisis. The war had given an important spur to industry
and encouraged many new inventions and chemical discoveries. "The war
was the great and most extravagant customer of farmers, manufacturers,
and other producers of wealth, and many during this period became very
wealthy.... And on the day on which peace was signed, the great customer
of the producers died, and prices fell as the demand diminished, until
the prime cost of the articles required for war could not be
obtained.... Barns and farmyards were full, warehouses loaded, and such
was our artificial state of society that this very superabundance of
wealth was the sole cause of the existing distress. _Burn the stock in
the farmyards and warehouses, and prosperity would immediately
recommence, in the same manner as if the war had continued._ This want
of demand at remunerating prices compelled the master producers to
consider what they could do to diminish the amount of their productions
and the cost of producing until these surplus stocks could be taken out
of the market. To effect these results, every economy in producing was
resorted to, and men being more expensive machines for producing than
mechanical and chemical inventions and discoveries so extensively
brought into action during the war, the men were discharged and the
machines were made to supersede them--while the numbers of the
unemployed were increased by the discharge of men from the army and
navy. Hence the great distress for want of work among all classes whose
labor was so much in demand while the war continued. This increase of
mechanical and chemical power was continually diminishing the demand
for, and value of, manual labor, and would continue to do so, and would
effect great changes throughout society."[27]

In this statement there are several points worthy of attention. In the
first place, the analysis of the crisis of 1815 is very like the later
analyses of commercial crises by the Marxists; secondly, the antagonism
of class interests is clearly developed, so far as the basic interests
of the employers and their employees are concerned. The former, in order
to conserve their interests, have to dismiss the workers, thus forcing
them into the direst poverty. Thirdly, the conflict between manual labor
and machine production is frankly stated. Owen's studies were leading
him from mere philanthropism to Socialism.

During the height of the distress of 1815, Owen called together a large
number of cotton manufacturers at a conference, held in Glasgow, to
consider the state of the cotton trade and the prevailing distress. He
proposed (1) that they should petition Parliament for the repeal of the
revenue tariff on raw cotton; (2) that they should call upon Parliament
to shorten the hours of labor in the cotton mills by legislative
enactment, and otherwise seek to improve the condition of the working
people. The first proposition was carried with unanimity, but the
second, and to Owen the more important, did not even secure a
seconder.[28] The conference plainly showed the power of class
interests. The spirit in which Owen faced his fellow-manufacturers is
best seen in the following extract from the address delivered by him,
with copies of which he afterward literally deluged the kingdom:--

"True, indeed, it is that the main pillar and prop of the political
greatness and prosperity of our country is a manufacture which, as now
carried on, is destructive of the health, morals, and social comfort of
the mass of people engaged in it. It is only since the introduction of
the cotton trade that children, at an age before they had acquired
strength or mental instruction, have been forced into cotton
mills,--those receptacles, in too many instances, for living human
skeletons, almost disrobed of intellect, where, as the business is often
now conducted, they linger out a few years of miserable existence,
acquiring every bad habit which they may disseminate throughout society.
It is only since the introduction of this trade that children and even
grown people were required to labor more than twelve hours in a day, not
including the time allotted for meals. It is only since the introduction
of this trade that the sole recreation of the laborer is to be found in
the pot-house or ginshop, and it is only since the introduction of this
baneful trade that poverty, crime, and misery have made rapid and
fearful strides throughout the community.

"Shall we then go unblushingly and ask the legislators of our country to
pass legislative acts to sanction and increase this trade--to sign the
death warrants of the strength, morals, and happiness of thousands of
our fellow-creatures, and not attempt to propose corrections for the
evils which it creates? If such shall be your determination, I, for one,
will not join in the application,--no, I will, with all the faculties I
possess, oppose every attempt made to extend the trade that, except in
name, is more injurious to those employed in it than is the slavery in
the West Indies to the poor negroes; for deeply as I am interested in
the cotton manufacture, highly as I value the extended political power
of my country, yet knowing as I do, from long experience both here and
in England, the miseries which this trade, as it is now conducted,
inflicts on those to whom it gives employment, I do not hesitate to say:
_Perish the cotton trade, perish even the political superiority of our
country, if it depends on the cotton trade, rather than that they shall
be upheld by the sacrifice of everything valuable in life._"[29]

This conference doubtless had much to do with Owen's acceptance of a
communistic ideal approaching that of modern Socialism in many important
respects. It certainly intensified the hatred and fear of those
manufacturers whose interests he had so courageously attacked. In 1817
we find him proposing to the British government the establishment of
communistic villages, as the best means of remedying the terrible
distress which prevailed at that time. From this time onward his
interest in mere surface reforms such as he had been carrying on at New
Lanark seemed to wane. He became at this juncture an apostle of
Communism, or as he later preferred to say, Socialism. His ideal was a
coöperative world, with perfect equality between the sexes. He had
completely demonstrated to his own mind that private property was
incompatible with social well-being. Every month of his experience at
New Lanark had deeply impressed him with the conviction that to make it
possible for all people to live equally happy and moral lives they must
have equal material resources and conditions of life, and he could not
understand why it had never occurred to others before him.

Here we have the essential characteristic of Utopian Socialism as
distinguished from modern, or scientific, Socialism. The Utopians regard
human life as something plastic and capable of being shaped and molded
according to systems and plans. All that is necessary is to take some
abstract principle as a standard, and then prepare a plan for the
reorganization of society in conformity with that principle. If the plan
is perfect, it will be enough to demonstrate its advantages as one would
demonstrate a sum in arithmetic. The scientific Socialists, on the other
hand, are evolutionists. Society, they believe, cannot take leaps at
will; social changes are products of the past and the present. They
distrust social inventors and schemes. Socialism is not an ingenious
plan for the realization of abstract Justice, or Brotherhood, but a
necessary outgrowth of the centuries. Owen, then, was a Utopian. He
regarded himself as one inspired, an inspired inventor of a new social
system, and believed that it was only necessary for him to demonstrate
the truth of his contentions and theories, by argument and practical
experiment, to bring about the transformation of the world. He
conducted a tremendous propaganda, by means of newspapers, pamphlets,
lectures, and debates, and established various communities in England
and this country. In face of a bitter opposition and repeated failure,
he kept on with sublime faith and unbounded courage which nothing could

In 1825 Owen began the greatest and most splendid of his social
experiments in the village of Harmonie, Indiana, in the beautiful valley
of the Wabash. The place had already been the theater of an interesting
experiment in religious communism, Owen having bought the property from
the Rappites. In February and March, 1825, the brave reformer addressed
two of the most distinguished audiences ever gathered in the Hall of
Representatives at the national capital. In the audiences were the
President of the United States, the Judges of the Supreme Court, several
members of the cabinet, and almost the entire membership of both houses
of Congress. Owen explained his plans for the regeneration of society in
detail, exhibiting a model of the buildings to be erected. It is almost
impossible to realize at this day the tremendous interest which his
appeal to Congress awakened. His vision of a re-created world caught the
popular imagination.

Among those whose minds were fired was a boy of sixteen, tall, lank,
uncouth, and poor. Word had come to him of Owen's splendid undertaking,
and he had caught something of the enthusiasm of the great dreamer.
Above all, it was said that New Harmony was to be a wonderful center of
learning, that the foremost educators of the world would establish great
schools there, fully equipped with books and all sorts of appliances. To
be a scholar had been the boy's one great ambition, so he yearned
wistfully for an opportunity to join the new community. But his father
forbidding, claiming his services, the boy suffered grievous
disappointment. One wonders what effect residence at New Harmony would
have had upon the life of Abraham Lincoln, and upon the history of
America! And how much, one wonders, was that splendid life influenced by
that boyish interest in the regeneration of the world?

That the influence of New Harmony was felt by Lincoln we know. It was a
child of New Harmony, Robert Dale Owen, son of Robert Owen, who, when
emancipation seemed to hang in the balance, penned his remarkable letter
to President Lincoln, dated September seventeenth, 1862. "Its perusal
thrilled me like a trumpet call," said the great President. Five days
after its receipt the Preliminary Proclamation was issued. "Your letter
to the President had more influence on him than any other document which
reached him on the subject--I think I might say than all others put
together. I speak of that which I know from personal conference with
him," wrote Salmon P. Chase, Secretary of the Treasury.

New Harmony failed. Other communities established by Owen failed, but
the story of their failure is nevertheless full of inspiration. The
world has long since written the word "Failure" as an epitaph for Robert
Owen. But what a splendid failure that life was! Standing by his grave
one day, in the picturesque little churchyard at Newton, by a bend of
the winding river, not far from the ruins of the ancient castle home of
the famous Deist, Lord Herbert, the writer said to an old Welsh laborer,
"But his life was a failure, was it not?" The old man gazed awhile at
the grave, and then with a voice of unforgettable reverence and love
answered, "I suppose it was, sir, as the world goes; a failure like
Jesus Christ's. But I don't call it failure, sir. He established infant
schools; he founded the great coöperative movement; he helped to make
the trade unions;[30] he helped to give us the factory acts; he worked
for peace between two great countries. His Socialism has not been
realized yet, nor has Christ's--but it will come!"


Owen was not the only builder of Utopias in his time. In the same year
that Owen launched his New Harmony venture, there died in Paris another
dreamer of social millenniums, a gentle mystic, Henry de Saint-Simon,
and in 1837, the year of Owen's third Socialist congress, another great
Utopist died in the French capital, Charles Fourier. Each of these
contributed something to the development of the theories of Socialism,
each has a legitimate place in the history of the Socialist movement.
But this little work is not intended to give the history of
Socialism.[31] I have taken only one of the three great Utopists, as
representative of them all: one who seems to me to be much nearer to the
later scientific movement pioneered by Marx and Engels than any of the
others. In the Socialism of Owen, we have Utopian Socialism at its best.

What distinguishes the Utopian Socialists from their scientific
successors we have already noted. Engels expresses the principle very
clearly in the following luminous passage: "One thing is common to all
three. Not one of them appears as a representative of the interests of
that proletariat which historical development had ... produced. Like the
French philosophers,[32] they do not claim to emancipate a particular
class to begin with, but all humanity at once. Like them, they wish to
bring in the kingdom of reason and eternal justice, but this kingdom, as
they see it, is as far as heaven from earth from that of the French

"For, to our three social reformers, the bourgeois world, based upon the
principles of these philosophers, is quite as irrational and unjust,
and, therefore, finds its way to the dust hole quite as readily, as
feudalism and all the earlier stages of society. If pure reason and
justice had not, hitherto, ruled the world, this has been the case only
because men have not rightly understood them. What was wanted was the
individual man of genius, who has now arisen and who understands the
truth. That he has now arisen, that the truth has now been clearly
understood, is not an inevitable event, following of necessity in the
chain of historical development, but a mere happy accident. He might
just as well have been born five hundred years earlier, and might then
have spared humanity five hundred years of error, strife, and

Neither of these great Utopists had anything like the conception of
social evolution, determined by economic conditions and the resulting
conflicts of economic classes, which constitutes the base of the
philosophy of the scientific Socialists. Each of them had some faint
comprehension of isolated facts, but neither of them developed his
knowledge very far, nor could the facts appear to them as correlated
later by Marx. Saint-Simon, as we know, recognized the class struggle in
the French Revolution, and saw in the Reign of Terror only the momentary
reign of the non-possessing masses;[34] he saw, too, that the political
question was fundamentally an economic question, declaring that politics
is the science of production, and prophesying that politics would be
absorbed by economics.[35] Fourier, we also know, applied the principle
of evolution to society. He divided the history of society into four
great epochs--savagery, barbarism, the patriarchate, and
civilization.[36] But just as Saint-Simon failed to grasp the
significance of the class conflict, and its relation to the fundamental
character of economic institutions, which he dimly perceived, so Fourier
failed to grasp the significance of the evolutionary process which he
described, and, like Saint-Simon, he halted upon the brink, so to speak,
of an important discovery. His concept of social evolution meant little
to him and possessed only an academic interest. And Owen, in many
respects the greatest of the three, realized in a practical manner that
the industrial problem was a class conflict. Not only had he found in
1815 that pity was powerless to move the hearts of his
fellow-manufacturers when their class interests were concerned, but
later, in 1818, when he went to present his famous memorial to the
Congress of Sovereigns at Aix-la-Chapelle, he had another lesson of the
same kind. At Frankfort, Germany, he tarried on his way to the Congress,
and was invited to attend a notable dinner to meet the Secretary of the
Congress, M. Gentz, a famous diplomat of the day, "who enjoyed the full
confidence of the leading despots of Europe." After Owen had outlined
his schemes for social amelioration, M. Gentz was asked for his reply,
and Owen tells us that the diplomat answered, "We know very well that
what you say is true, but how could we govern the masses, if they were
wealthy, and so, independent of us?"[37] Lord Lauderdale, too, had
exclaimed on another occasion, "Nothing [_i.e._ than Owen's plans] could
be more complete for the poor and working classes, but what will become
of us?"[38] Scattered throughout Owen's writings and speeches are
numerous evidences that he at times recognized the class antagonisms in
industrial society as the heart of the industrial problem,[39] but to
him, also, the germ of an important truth meant practically nothing. He
saw only the facts in their isolation, and made no attempt to discover
their meaning or to relate them to his teaching.

Each of the three men regarded himself as the discoverer of the truth
which would redeem the world; each devoted himself with magnificent
faith and heroic courage to his task; each failed to realize his hopes;
and each left behind him faithful disciples and followers, confident
that the day must come at last when the suffering and disinherited of
earth will be able to say, in Owen's dying words, "Relief has come."
Perhaps no better estimate of the value of the visions of these great
Utopists has ever been penned than that by Emerson in the following
tribute to Owen:[40]--

"Robert Owen of New Lanark came hither from England in 1845 to read
lectures or hold conversations wherever he could find listeners--the
most amiable, sanguine, and candid of men. He had not the least doubt
that he had hit on the plan of right and perfect Socialism, or that
mankind would adopt it. He was then seventy years old, and being asked,
'Well, Mr. Owen, who is your disciple? how many men are there possessed
of your views who will remain after you are gone to put them in
practice?' 'Not one,' was the reply. Robert Owen knew Fourier in his old
age. He said that Fourier learned of him all the truth that he had. The
rest of his system was imagination, and the imagination of a visionary.
Owen made the best impression by his rare benevolence. His love of men
made us forget his 'three errors.' His charitable construction of men
and their actions was invariable. He was the better Christian in his
controversies with Christians.

"And truly I honor the generous ideas of the Socialists, the
magnificence of their theories, and the enthusiasm with which they have
been urged. They appeared inspired men of their time. Mr. Owen preached
his doctrine of labor and reward with the fidelity and devotion of a
saint in the slow ears of his generation.

"One feels that these philosophers have skipped no fact but one, namely,
life. They treat man as a plastic thing, or something that may be put up
or down, ripened or retarded, molded, polished, made into solid or fluid
or gas at the will of the leader; or perhaps as a vegetable, from which,
though now a very poor crab, a very good peach can by manure and
exposure be in time produced--and skip the faculty of life which spawns
and spurns systems and system makers; which eludes all conditions; which
makes or supplants a thousand Phalanxes and New Harmonies with each

"Yet, in a day of small, sour and fierce schemes, one is admonished and
cheered by a project of such friendly aims, and of such bold and
generous proportions; there is an intellectual courage and strength in
it which is superior and commanding; it certifies the presence of so
much truth in the theory, and in so far is destined to be fact.

"I regard these philanthropists as themselves the effects of the age in
which they live, in common with so many other good facts the
efflorescence of the period and predicting the good fruit that ripens.
They were not the creators that they believed themselves to be; but they
were unconscious prophets of the true state of society, one which the
tendencies of nature lead unto, one which always establishes itself for
the sane soul, though not in that manner in which they paint it."

     "Our visions have not come to naught,
     Who saw by lightning in the night;
     The deeds we dreamed are being wrought
     By those who work in clearer light;
     In other ways our fight is fought,
     And other forms fulfill our thought
     Made visible to all men's sight."[41]


[10] _Karl Marx: Biographical Memoirs_, by Wilhelm Liebknecht, page 101.

[11] _Socialism, Utopian and Scientific_, by F. Engels, London, 1892,
pages 20-25.

[12] For good accounts of the life of Owen the reader is referred to the
Biography, by Lloyd Jones, in _The Social Science Series_, 1890,
published by Swan, Sonnenschein & Co., London, and the _Life of Robert
Owen_, by Frank Podmore, 2 vols., New York, 1907.

[13] _The Industrial History of England_, by H. de B. Gibbins, London,
Methuen and Co.

[14] _Industrial History of England_, page 179.

[15] This anonymous historian is now known to have been Mr. Samuel Kydd,
barrister-at-law (_vide_ Cooke-Taylor).

[16] _The Factory System and the Factory Acts_, by R. W. Cooke-Taylor,
London, 1894.

[17] In two volumes: London, Effingham Wilson, 1857 and 1858. Vol. I
contains the Life; Vol. II is a Supplementary Appendix. Quotations are
from Vol. I.

[18] See _Songs of Freedom_, by H. S. Salt, pages 81-83.

[19] _Industrial History of England_, page 181.

[20] _Capital_, by Karl Marx, Vol. I, page 467, Kerr edition.

[21] _Idem_, Vol. I, page 468.

[22] _Capital_, Vol. I, page 468.

[23] For instance, he so improved the machinery and increased the
fineness of the threads that, instead of spinning seventy-five thousand
yards of yarn to the pound of cotton, he spun two hundred and fifty
thousand! At that time a pound of cotton, which in its raw state was
worth $1.25, became worth $50 when spun.--_Life of Robert Owen_,
Philadelphia, 1866.--_Anonymous._

[24] _Autobiography._

[25] _The Force of Circumstances_, a poem, by John Garwood, Birmingham,

[26] Quoted by Engels, _Socialism, Utopian and Scientific_, page 22
(English edition, 1892).

[27] Quoted by H. M. Hyndman, _The Economics of Socialism_, page 150.

[28] _The New Harmony Communities_, by George Browning Lockwood, page

[29] Quoted by Lockwood, _The New Harmony Communities_, pages 71-72.

[30] Owen presided at the first organized Trade Union Congress in

[31] For the history of these and other Utopian Socialist schemes, the
reader is referred to Professor Ely's _French and German Socialism_
(1883); Kirkup's _History of Socialism_ (1900); and Hillquit's _History
of Socialism in the United States_ (1903).

[32] The Encyclopædists.

[33] Engels, _Socialism, Utopian and Scientific_, pages 6-7.

[34] Engels, _Socialism, Utopian and Scientific_, page 15.

[35] _Idem._

[36] _Idem_, page 18.

[37] _Autobiography._

[38] _Idem._

[39] See, for instance, _The Revolution in Mind and Practice_, by Robert
Owen, pages 21-22.

[40] _Essay on Robert Owen._

[41] Gerald Massey.




The _Communist Manifesto_ has been called the birth-cry of the modern
scientific Socialist movement. When it was written, at the end of 1847,
little remained of those great movements which in the early part of the
century had inspired millions with high hopes of social regeneration and
rekindled the beacon fires of faith in the world. The Saint-Simonians
had, as an organized body, disappeared; the Fourierists were a dwindling
sect, discouraged by the failure of the one great trial of their system,
the famous Brook Farm experiment, in the United States; the Owenite
movement had never recovered from the failures of the experiments at New
Harmony and elsewhere, and had lost much of its identity through the
multiplicity of interests embraced in Owen's later propaganda. Chartism
and Trade Unionism on the one hand, and the Coöperative Societies on the
other, had, between them, absorbed most of the vital elements of the
Owenite movement.

There was a multitude of what Engels calls "social quacks," but the
really great social movements, Owenism in England, and Fourierism in
France, were utterly demoralized and rapidly dwindling away. One thing
only served to keep the flame of hope alive--"the crude, rough-hewn,
purely instinctive sort of Communism" of the workers. This Communism of
the working class differed very essentially from the Socialism of
Fourier and Owen. It was Utopian, being based, like all Utopian
movements, upon abstract ideas. It differed from Fourierism and Owenism,
however, in that instead of a universal appeal based upon Brotherhood,
Justice, Order, and Economy, its appeal was, primarily, to the laborer.
Its basis was the crude class doctrine of "the rights of Labor." The
laborer was appealed to as one suffering from oppression and injustice.
It was, therefore, distinctly a class movement, and its
class-consciousness was sufficiently developed to keep its leaders from
wasting their lives in abortive appeals to the master class. The leading
exponents of this Communism of the workers were Wilhelm Weitling, in
Germany, and Étienne Cabet, in France.

Weitling was a man of the people. He was born in Magdeburg, Germany, in
1808, the illegitimate child of a humble woman and her soldier lover. He
became a tailor, and, as was the custom in Germany at that time,
traveled extensively during his apprenticeship. In 1838 his first
important work, "The World As It Is, and As It Might Be," appeared,
published in Paris by a secret revolutionary society consisting of
German workingmen of the "Young Germany" movement. In this work Weitling
first expounded at length his communistic theories. It is claimed[42]
that his conversion to Communism was the result of the chance placing of
a Fourierist paper upon the table of a Berlin coffeehouse, by Albert
Brisbane, the brilliant friend and disciple of Fourier, his first
exponent in the English language. This may well be true, for, as we
shall see, Weitling's views are mainly based upon those of the great
French Utopist. In 1842 Weitling published his best-known work, the book
upon which his literary fame chiefly rests, "The Guaranties of Harmony
and Freedom." This work at once attracted wide attention, and gave
Weitling a foremost place among the writers of the time in the
affections of the educated workers. It was an elaboration of the
theories contained in his earlier book. Morris Hillquit[43] thus
describes Weitling's philosophy and method:--

"In his social philosophy, Weitling may be said to have been the
connecting link between primitive and modern Socialism. In the main, he
is still a Utopian, and his writings betray the unmistakable influence
of the early French Socialists. In common with all Utopians, he bases
his philosophy exclusively upon moral grounds. Misery and poverty are to
him but the results of human malice, and his cry is for 'eternal
justice' and for the 'absolute liberty and equality of all mankind.' In
his criticism of the existing order, he leans closely on Fourier, from
whom he also borrowed the division of labor into three classes of the
Necessary, Useful, and Attractive, and the plan of organization of
'attractive industry.'

"His ideal of the future state of society reminds us of the
Saint-Simonian government of scientists. The administration of affairs
of the entire globe is to be in the hands of the three greatest
authorities on 'philosophical medicine,' physics, and mechanics, who are
to be reënforced by a number of subordinate committees. His state of the
future is a highly centralized government, and is described by the
author with the customary details. Where Weitling, to some extent,
approaches the conception of modern Socialism, is in his recognition of
class distinctions between employer and employee. This distinction never
amounted to a conscious indorsement of the modern Socialist doctrine of
the 'class struggle,' but his views on the antagonism between the 'poor'
and the 'wealthy' came quite close to it. He was a firm believer in
labor organizations as a factor in developing the administrative
abilities of the working class; the creation of an independent labor
party was one of his pet schemes, and his appeals were principally
addressed to the workingmen."

Weitling visited the United States in 1846, a group of German exiles,
identified with the Free Soil movement, having invited him to become the
editor of a magazine, the _Volkstribun_, devoted to the principles of
the movement. By the time he reached America, however, the magazine had
suspended publication. He stayed little more than a year, hastening back
to the fatherland to share in the revolutionary activities of 1848. He
returned to America again in 1849, after the failure of the "glorious
revolution," and for many years thereafter was an active and tireless
propagandist. He died in Brooklyn in 1871.

Étienne Cabet was, in many ways, a very different type of man from
Weitling, but their ideas were not so dissimilar. Cabet, born in Dijon,
France, in 1788, was the son of a fairly prosperous cooper, and received
a good university education. He studied both medicine and law, adopting
the profession of the latter and early achieving marked success in its
practice. He took a leading part in the Revolution of 1830 as a member
of the "Committee of Insurrection," and upon the accession of Louis
Philippe was "rewarded" by being made Attorney-General for Corsica.
There is no doubt that the government desired to remove Cabet from the
political life of Paris, quite as much as to reward him for his services
during the Revolution; his strong radicalism, combined with his sturdy
independence of character, being rightly regarded as dangerous to Louis
Philippe's régime. His reward, therefore, took the form of practical
banishment. The wily advisers of Louis Philippe used the gloved hand.
But the best-laid schemes of mice and courtiers "gang aft agley." Cabet,
in Corsica, joined the radical anti-administration forces, and became a
thorn in the side of the government. Removed from office, he returned to
Paris, whereupon the citizens of Dijon, his native town, elected him as
their deputy to the lower chamber in 1834. Here he continued his
opposition to the administration, and was at last tried on a charge of
_lèse majesté_, and given the option of choosing between two years'
imprisonment and five years' exile.

Cabet chose exile, and took up his residence in England, where he fell
under the influence of Owen's agitation and became a convert to his
Socialistic views. During this time of exile, too, he became acquainted
with the "Utopia" of Sir Thomas More and was fascinated by it. The idea
of writing a similar work of fiction to propagate his Socialist belief
impressed itself upon his mind, and he wrote "a philosophical and social
romance," entitled "Voyage to Icaria," which was published soon after
his return to Paris, in 1839. In this novel Cabet follows closely the
method of More, and describes "Icaria" as "a Promised Land, an Eden, an
Elysium, a new terrestrial Paradise." The plot of the book is simple in
the extreme, and its literary merit is not very great. The writer
represents that he met, in London, a nobleman, Lord William Carisdall,
who, having by chance heard of Icaria and the wonderful and strange
customs and form of government of its inhabitants, visited the country.
Lord William kept a diary in which he described all that he saw in this
wonderland. This record, we are told, the traveler had permitted to be
published through the medium of his friend, and under his editorial
supervision. The first part of the book contains an attractive account
of the coöperative system of the Icarians, their communistic government,
equality of the sexes, and high standard of morality. The second part is
devoted to an account of the history of Icaria, prior to and succeeding
the revolution of 1782, when the great national hero, Icar, established

The book created a tremendous furore in France. It appealed strongly to
the discontented masses, and it is said that by 1847 Cabet had no less
than four hundred thousand adherents among the workers of France. The
numerical strength of revolutionary movements is almost invariably
greatly exaggerated, however, and it is not likely that the figures
cited are exceptional in this regard. It is possible, _cum grano
salis_, to accept the figures only by remembering that a very
infinitesimal proportion of these were adherents in the sense of being
ready to follow Cabet's leadership, as subsequent events showed. When
the clamor rose for a practical test of the theories set forth so
alluringly, Cabet visited Robert Owen in England and sought advice as to
the best site for such an experiment. Owen recommended Texas, then
recently admitted into the union of states and anxious for settlers.
Cabet accepted Owen's advice and called for volunteers to form the
"advance guard" of settlers, the number responding being pitifully,
almost ludicrously, small. Still, the effect of the book was very great,
and it served to fire the flagging zeal of those workers for social
regeneration whose hearts must otherwise have become deadly sick from
long-deferred hopes.

The confluence of these two streams of Communist propaganda represented
by Weitling and Cabet constituted the real Communist "movement" of
1840-1847. Its organized expression was the Communist League, a secret
organization with its headquarters in London. The League was formed in
Paris by German refugees and traveling workmen, and seems to have been
an offspring of Mazzini's "Young Europe" agitation of 1834. At different
times it bore the names, "League of the Just," "League of the
Righteous," and, finally, "Communist League."[44] For many years it
remained a mere conspiratory society, exclusively German, and existed
mainly for the purpose of fostering the "Young Germany" ideas. Later it
became an International Alliance with societies in many parts of Europe.

In 1847 Karl Marx was residing in Brussels. During a prior residence in
Paris he had come into close association with the leaders of the League
there, and had agreed to form a similar society in Brussels. Engels was
in Paris in 1847, and it was probably due to his activities that the
Paris League officially invited both him and Marx to join the
international organization, promising that a congress should be convened
in London at an early date. We may, in view of the after career of
Engels as the politician of the movement, surmise so much. Be that how
it may, the invitation, with its promise to call a congress in London,
was extended and accepted. The reason for the step, the object of the
proposed congress, is quite clear. Marx himself has placed it beyond
dispute. During his stay in Paris he and Engels had discussed the
position of the League with some of its leaders, and he had, later,
criticised it in the most merciless manner in some of his pamphlets.[45]
Marx desired a revolutionary working class political party with a
definite aim and policy. Those leaders of the League who agreed with him
in this were the prime movers for the congress, which was held in
London, in November, 1847.

At the congress, Marx and Engels presented their views at great length,
and outlined the principles and policy which their famous pamphlet later
made familiar. Perhaps it was due to the very convincing manner in which
they argued that the emancipation of the working class must be the work
of that class itself, that there was some opposition to them, on the
part of a few delegates, on the ground that they were "Intellectuals"
and not members of the proletariat, a criticism which pursued them all
through their lives. Their views found general favor, however, as might
be expected from such an inchoate mass of men, revolutionaries to the
core, and waiting only for effective leadership. A resolution was
adopted requesting Marx and Engels to prepare "a complete theoretical
and working programme" for the League. This they did. It took the form
of the _Communist Manifesto_, published in the early part of January,


The authors of the _Manifesto_ were men of great intellectual gifts.
Either of them alone must have won fame; together, they won immortality.
Their lives, from the date of their first meeting in Paris, in 1844, to
the death of Marx, almost forty years later, are inseparably interwoven.
The friendship of Damon and Pythias was not more remarkable.

Karl Heinrich Marx was born on the fifth day of May, 1818, at Treves,
the oldest town in Germany, dating back to Roman times. His parents were
both people of remarkable character. His mother--_née_ Pressburg--was
the descendant of Hungarian Jews who in the sixteenth century had
settled in Holland. Many of her ancestors had been rabbis. Marx was
passionately devoted to his mother, always speaking of her with reverent
admiration. On his father's side, also, Marx boasted of a long line of
rabbinical ancestors, and it has been suggested that he owed to this
rabbinical ancestry some of his marvelous gift of luminous exposition.
The true family name was Mordechia, but that was abandoned by his
grandfather, who took the name of Marx, which the grandson was destined
to make famous. The father of Karl was a lawyer of some prominence and
considerable learning, and a man of great force of character. In 1824,
the boy Karl being then six years old, he renounced the Jewish religion
and embraced Christianity, all the members of the family being baptized
and received into the Church.

There is a familiar legend that this act was the result of compulsion,
being taken in response to an official edict.[46] He held at the time
the position of notary public at the county court, and it is claimed
that the official edict in question required all Jews holding official
positions to forego them, and to abandon the practice of law, or to
accept the Christian faith. Many writers, including Liebknecht[47] and
one of the daughters of Karl Marx,[48] have given this explanation of
the renunciation of Judaism by the elder Marx. It seems certain,
however, that the act was purely voluntary, and that there was no such
edict.[49] It may be that social ambitions had something to do with it,
that he hoped to attain, as a Christian, a measure of success not
possible to an adherent of the Hebrew faith. Whatever the motive, the
act was a voluntary one. A great admirer of the eighteenth-century
"materialists," and a disciple of Voltaire, he believed in God, he said,
as Newton, Locke, and Leibnitz had done before him. He discussed
religious and philosophical questions very freely and frankly with his
son, and read Voltaire and Racine with him. As for the mother of Marx,
she also believed in God--"not for God's sake, but for my own," she
explained when asked about it.

At the earnest behest of his father, Marx studied law at the
universities of Bonn, Berlin, and Jena. But "to please himself" he
studied history and philosophy, winning great distinction in these
branches of learning. He graduated in 1841, as a Doctor of Philosophy,
with an essay on the philosophy of Epicurus, and it was his purpose to
settle at Bonn as a professor of philosophy. The plan was abandoned,
partly because he had already discovered that his bent was toward
political activity, and partly because the Prussian government had made
scholastic independence impossible, thus destroying the attractiveness
of an academic career. Accordingly, Marx accepted the editorship of a
democratic paper, the _Rhenish Gazette_, in which he waged bitter,
relentless war upon the government. Time after time the censors
interfered, but Marx was too brilliant a polemicist, even thus early in
his career, and far too subtle for the censors. Finally, at the request
of his managers, who hoped thus to avoid being compelled to suspend the
publication, Marx retired from the editorship. This did not serve to
save the paper, however, and it was suppressed by the government in
March, 1843.

Soon after this Marx went to Paris, with his young bride of a few
months, Jenny von Westphalen, the playmate of his childhood. The Von
Westphalens were of the nobility, and a brother of Mrs. Marx afterward
became a Prussian Minister of State. The elder Von Westphalen was half
Scotch, related, on his maternal side, to the Argyles. He was a lineal
descendant of the Duke of Argyle who was beheaded in the reign of James
II. His daughter tells an amusing story of how Marx, many years later,
having to pawn some of his wife's heirlooms, especially some heavy,
antique silver spoons which bore the Argyle crest and motto, "Truth is
my maxim," narrowly escaped arrest on suspicion of having robbed the
Argyles![50] To Paris, then, Marx went, and there met, among others,
Heinrich Heine, many of whose poems he suggested, Arnold Ruge, the poet,
P. J. Proudhon, and Michael Bakunin, the Anarchist philosopher, and,
above all, the man destined to be his very _alter ego_, Friedrich
Engels, with whom he had already had some correspondence.[51]

The attainments of Engels have been somewhat overshadowed by those of
his friend. Born at Barmen, in the province of the Rhine, November 28,
1820, he was educated in the gymnasium of that city, and after serving
his period of military service, from 1837 to 1841, was sent, in the
early part of 1842, to Manchester, England, to look after a
cotton-spinning business of which his father was principal owner. Here
he seems to have at once begun a thorough investigation of social and
industrial conditions, the results of which are contained in a book,
"The Condition of the Working Class in England in 1844," which remains
to this day a classic presentation of the social and industrial life of
the period. From the very first, already predisposed, as we know, he
sympathized with the views of the Chartists and the Owenite Socialists.
He became friendly with the Chartist leaders, notably with Feargus
O'Connor, to whose paper, the _Northern Star_, he became a contributor.
He also became friendly with Robert Owen, and wrote for his _New Moral
World_.[52] His linguistic abilities were very great; it is said that he
had thoroughly mastered no less than ten languages--a gift which helped
him immensely in his literary and political associations with Marx.

When the two men met for the first time, in 1844, they were drawn
together by an irresistible impulse. They were kindred spirits. Marx had
gone to Paris mainly for the purpose of studying the Socialist movement
of the time. During his editorship of the _Rhenish Gazette_ several
articles had appeared on the subject, and he had refused to attack the
Socialists in any manner. He had gone to Paris with a considerable
reputation already established as a leader of radical thought, and at
once sought out the Saint-Simonians, under whose influence he was led to
declare himself definitely a Socialist. At first this seems difficult to
explain, so wide is the chasm which yawns between the "New Christianity"
of Saint-Simon and the materialism of Marx. There seems to be no bond of
sympathy between the religious mysticism of the French dreamer and the
scientific thought of the German economist and philosopher.

Marx has been described as being "rigidly mathematical,"[53] and the
picture of the man one gets from his writings is that of a cold,
unemotional philosopher, dealing only with facts and caring nothing for
idealism. But the real Marx was a very different sort of man. His life
was itself a splendid example of noble idealism, and underlying all his
materialism there was a great religious spirit, using the word
"religious" in its noblest and best sense, quite independent of dogmatic
theology. All his life he was a deep student of Dante, the _Divine
Comedy_ being his constant companion, so that he knew it almost
completely by heart. Some of his attacks upon Christianity are very
bitter, and have been much quoted against Socialism, but they are not
one whit more bitter than the superb thunderbolts of invective which
the ancient Hebrew prophets hurled against an unfaithful Church and
priesthood. For the most part, they are attacks upon religious hypocrisy
rather than upon Christianity. Marx was, of course, an agnostic, even an
atheist, but he was full of sympathy with the underlying ethical
principles of all the great religions. Always tolerant of the religious
opinions of others, he had nothing but scorn and contempt for the
blatant dogmatic atheism of his time, and vigorously opposed committing
the Socialist movement to atheism as part of its programme.[54] In
short, he was a man of fine spiritual instincts, splendidly religious in
his irreligion.

This spiritual side of Marx must be considered if we would understand
the man. It is not necessary, however, to ascribe the influence of
Saint-Simonian thought upon him to a predisposing spiritual temperament.
Marx, with his usual penetration, saw in Saint-Simonism the hidden germ
of a great truth, the embryo of a profound social theory. Saint-Simon,
as we have seen, had vaguely indicated the two ideas which were
afterward to be cardinal doctrines of the Marx-Engels _Manifesto_--the
antagonism of classes, and the economic foundation of political
institutions. Not only so, but Saint-Simon's grasp of political
questions, instanced by his advocacy, in 1815, of a triple alliance
between England, France, and Germany,[55] appealed to Marx, and
impressed him alike by its fine perspicacity and its splendid courage.
Engels, in whom, as stated, the working-class spirit of Chartism and
the ideals of Owenism were blended, found in Marx a twin spirit. They
were, indeed,--

     "Two souls with but a single thought,
     Two hearts that beat as one."


The _Communist Manifesto_ is the first declaration of an International
Workingmen's Party. Its fine peroration is a call to the workers to
transcend the petty divisions of nationalism and sectarianism: "The
proletarians have nothing to lose but their chains. They have a world to
win. Workingmen of all countries, unite!" These concluding phrases of
the _Manifesto_ have become the shibboleths of millions. They are
repeated with fervor by the disinherited workers of all the lands. Even
in China, lately so rudely awakened from the slumbering peace of the
centuries, they are voiced by an ever increasing army of voices. No
sentences ever coined in the mint of human speech have held such magic
power over such large numbers of men and women of so many diverse races
and creeds. As a literary production, the _Manifesto_ bears the
unmistakable stamp of genius.

But it is not as literature that we are to consider the historic
document. Its importance for us lies, not in its form, but in its
fundamental principle. And the fundamental principle, the essence or
soul of the declaration, is contained in this pregnant summary by

"In every historical epoch, the prevailing mode of economic production
and exchange, and the _social organization necessarily following from
it, form the basis upon which is built up, and from which alone can be
explained, the political and intellectual history of that epoch_, that
consequently the whole history of mankind (since primitive tribal
society holding land in common ownership) has been a history of class
struggles, contests between exploiting and exploited, ruling and
oppressed classes."[56]

Thus Engels summarizes the philosophy--as apart from the proposals of
immediate measures to constitute the political programme of the
party--of the _Manifesto_; the basis upon which the whole superstructure
of modern, scientific Socialist theory rests. This is the materialistic,
or economic, conception of history which distinguishes scientific
Socialism from all the Utopian Socialisms which preceded it. Socialism
is henceforth a theory of social evolution, not a scheme of
world-building; a spirit, not a thing. Thus, twelve years before the
appearance of "The Origin of Species," nearly twenty years after the
death of Lamarck, the authors of the _Communist Manifesto_ formulated a
great theory of social evolution as the basis of the mightiest
proletarian movement in history. Socialism had become a science instead
of a dream.


Naturally, in view of its historic rôle, the joint authorship of the
_Manifesto_ has been much discussed. What was the respective share of
each of its creators? What did Marx contribute, and what Engels? It may
be, as Liebknecht says, an idle question, but it is a perfectly natural
one. The pamphlet itself does not assist us. There are no internal signs
pointing now to the hand of the one, now to the hand of the other. We
may hazard a guess that most of the programme of ameliorative measures
was the work of Engels, and perhaps the final section. It was the work
of Engels throughout his life to deal with present social and political
problems in the light of the fundamental theories to the systematization
and elucidation of which Marx was devoted.

Beyond this mere conjecture, we have the word of Engels with regard to
the basal principle which he has summarized in the passage already
quoted. "The _Manifesto_ being our joint production," he says, "I
consider myself bound to state that the fundamental proposition which
forms its nucleus belongs to Marx.... This proposition, which, in my
opinion, is destined to do for history what Darwin's theory has done
for biology, we, both of us, had been gradually approaching for some
years before 1845. How far I had progressed toward it is best shown by
my 'Condition of the Working Class in England.'[57] But when I again met
Marx at Brussels, in spring, 1845, he had it ready worked out, and put
it before me in terms almost as clear as those in which I have stated it

Engels has lifted the veil thus far, but the rest is hidden. Perhaps it
is well that it should be; well that no man should be able to say which
passages came from the mind of Marx and which from the mind of Engels.
In life they were inseparable, and so they must be in the Valhalla of
history. The greatest political pamphlet of all time must forever bear,
with equal honor, the names of both. Their noble friendship unites them
even beyond the tomb.

     "Twin Titans! Whom defeat ne'er bowed,
     Scarce breathing from the fray,
     Again they sound the war cry loud,
     Again is riven Labor's shroud,
     And life breathed in the clay.
     Their work? Look round--see Freedom proud
     And confident to-day."[59]


[42] Cf. _Social Democracy Red Book_, edited by Frederic Heath (1900),
page 79.

[43] _History of Socialism in the United States_, by Morris Hillquit,
pages 161-162.

[44] E. Belfort Bax, article on _Friederich Engels_, in _Justice_
(London), No. 606, Vol. XII, August 24, 1895.

[45] _Disclosures about the Communists' Process, Herr Vogt_, etc.

[46] Cf. G. Adler, _Die Grundlagen der Karl Marx'schen Kritik der
bestehenden Volkswirthschaft_ (1887), page 226.

[47] _Karl Marx: Biographical Memoirs_, by Wilhelm Liebknecht, page 14.

[48] _Idem_, page 164.

[49] Cf. F. Mehring's _Aus dem literarischen Nachlass von Karl Marx,
Friederich Engels, und Ferdinand Lassalle_, 1902; the _Neue Beitrage zur
Biographie von Karl Marx und Friederich Engels, in Die Neue Zeit_, 1907,
and Mehring's _Geschichte der deutschen Sozialdemokratie_, 1903.

[50] _Memoirs of Marx_, by Wilhelm Liebknecht, page 164.

[51] Karl Kautsky, article on F. Engels, _Austrian Labor Almanac_, 1887.

[52] E. Belfort Bax, article on _Friederich Engels_, in _Justice_
(London), No. 606, Vol. XII, August 24, 1895.

[53] Cf. _Reminiscences of Karl Marx_, by W. Harrison Riley, in _The
Comrade_, Vol. III, No. 1, pages 5-6.

[54] Marx opposed the "Alliance de la Démocratic Socialiste," formed by
Bakunin, with its headquarters at Geneva, almost as vigorously for its
atheistic plank as for its denial of political methods. The first plank
in the programme of the "Alliance" was as follows:--

"The Alliance declares itself Atheist; it demands the abolition of all
worship, the substitution of science for faith, and of human justice for
Divine justice; the abolition of marriage, so far as it is a political,
religious, juridical, or civil institution."

This programme is frequently quoted against the Socialist
propaganda,--as, for example, by George Brooks, in _God's England or the
Devil's_?--in spite of the fact that the "Alliance" was an Anarchist
organization, bitterly opposed by Marx, and, in turn, bitterly opposing

In this connection, it may be well to call attention to an alleged
"quotation from Marx" which is frequently used by the opponents of
Socialism. It appears in the work of Brooks, quoted above, and in
Professor Peabody's _Jesus Christ and the Social Question_ (1907), page
16. Used in a public discussion by a New York labor union official, in
April, 1908, it was widely discussed by the press, and, according to
that same press, drew from the President of the United States
enthusiastic praise of the labor-union official in question. The passage
reads: "The idea of God must be destroyed. It is the keystone of a
perverted civilization. The true root of liberty, of equality, of
culture, is Atheism. Nothing must restrain the spontaneity of the human
mind." Had the opponents of Socialism been familiar with the teachings
of Marx, they would have known that he could not have said anything like
this, that it is absolutely at variance with all his teaching. The man
who formulated the materialist conception of history could not by any
possibility utter such balderdash. The fact is, the quotation is not
from Karl Marx at all, but from a very different writer, an Anarchist,
Wilhelm Marr, who was _a most bitter opponent of Socialism_. As given,
the quotation is a free translation of a passage contained in Marr's
_Das junge Deutschland in der Schweiz_, pages 131-134. Marr's programme,
as given in the _Report of the Royal Commission on Labor_ (Vol. V,
Germany), was the abolition of Church, State, property, and marriage,
with the one positive tenet of "a bloody and fearful revenge upon the
rich and powerful."

[55] See F. Engels, _Socialism, Utopian and Scientific_, page 16 (London
edition, 1892).

[56] F. Engels, Introduction to the _Communist Manifesto_ (English
translation, 1888). The italics are mine. J. S.

[57] F. Engels, _The Condition of the Working Class in England in 1844_.
See, for instance, pages 79, 80, 82, etc.

[58] Introduction to the _Communist Manifesto_ (English edition, 1888).

[59] From _Friederich Engels_, a poem by "J. L." (John Leslie), in
_Justice_ (London), August 17, 1895.




Socialism, then, in the modern, scientific sense, is a theory of social
evolution. Its hopes for the future rest, not upon the genius of some
Utopia-builder, but upon the inherent forces of historical development.
The Socialist state will never be realized except as the result of
economic necessity, the culmination of successive epochs of industrial
evolution. Thus the existing social system appears to the Socialist of
to-day, not as it appeared to the Utopians and as it still must appear
to mere ideologist reformers, as a triumph of ignorance or wickedness,
the reign of false _ideas_, but as the result of an age-long
evolutionary process, determined, not wholly indeed, but mainly, by
certain methods of producing the necessities of life in the first place,
and secondly, of effecting their exchange.

Not, let it be understood, that Socialism has become a mere mechanical
theory of economic fatalism. The historical development, the social
evolution, upon the laws of which the theories of Socialism are based,
is a human process, involving all the complex feelings, emotions,
aspirations, hopes, and fears common to man. To ignore this fundamental
fact, as they must who interpret the Marx-Engels theory of history as a
doctrine of economic fatalism, is to miss the profoundest significance
of the theory. While it is true that the scientific spirit destroys the
idea of romantic, magic transformations of the social system and the
belief that the world may be re-created at will, rebuilt upon the plans
of some Utopian architect, it still, as we shall see, leaves room for
the human factor. Otherwise, indeed, it would only be a new kind of
Utopianism. They who accept the theory that the production of the
material necessities of life is the main impelling force, the _geist_,
of human evolution, may rightly protest against social injustice and
wrong just as vehemently as any of the ideologists, and aspire just as
fervently toward a nobler and better state. The Materialistic Conception
of History does not involve the fatalist resignation summed up in the
phrase, "Whatever is, is natural, and, therefore, right." It does not
involve belief in man's helplessness to change conditions.


The idea of social evolution is admirably expressed in the fine phrase
of Leibnitz, "The present is the child of the past, but it is the parent
of the future."[60] The great seventeenth-century philosopher was not
the first to postulate and apply to society that doctrine of flux, of
continuity and unity, which we call evolution. In all ages of which
record has been preserved to us, it has been sporadically, and more or
less vaguely, expressed. Even savages seem to have dimly perceived it.
The saying of the Bechuana chief, recorded by the missionary, Casalis,
was probably, judging by its epigrammatic character, a proverb of his
people. "One event is always the son of another," he said--a saying
strikingly like that of Leibnitz.

Since the work of Lyell, Darwin, Wallace, Spencer, Huxley, Youmans, and
their numerous followers--a brilliant school embracing the foremost
historians and sociologists of Europe and America--the idea of evolution
as a universal law has made rapid and certain progress. Everything
changes; nothing is immutable or eternal. Whatever is, whether in
geology, astronomy, biology, or sociology, is the result of numberless,
inevitable, related changes. Only the law of change is changeless. The
present is a phase only of a great transition process from what was,
through what is, to what will be.

The Marx-Engels theory is an exploration of the laws governing this
process of evolution in the domain of human relations: an attempt to
provide a key to the hitherto mysterious succession of changes in the
political, juridical, and social relations and institutions of mankind.
Whence, for instance, arose the institution of chattel slavery, so
repugnant to our modern ideas of right and wrong, and how shall we
explain its defense and justification in the name of religion and
morality? How account for the fact that what Yesterday regarded as
righteous, To-day condemns as wrong; that what at one period of the
world's history is regarded as perfectly natural and right--the practice
of polygamy, for example--becomes abhorrent at another period; or that
what is regarded with horror and disgust in one part of the world is
sanctioned by the ethical codes, and freely practiced elsewhere? Ferri
gives two examples of this kind: the cannibalism of Central African
tribes, and the killing of parents, as a religious duty, in Sumatra.[61]
To reply "custom" is to beg the whole question, for customs do not exist
without reason, however difficult it may be to discern the reason for
any particular custom. To reply that these things are mysteries, as the
old theologians did when the doctrine of the Trinity was questioned, is
to leave the question unanswered and to challenge doubt and
investigation. The human mind abhors a mystery as nature abhors a
vacuum. Despite Spencer, the human mind has never admitted the existence
of the _Unknowable_. To explore the _Unknown_ is man's universal
impulse; and with each fresh discovery the _Unknown_ is narrowed by the
expansion of the _Known_.

The theory that ideas determine progress, that, in the words of
Professor Richard T. Ely, "all that is significant in human history may
be traced back to ideas,"[62] is only true in the sense that a half
truth is true. It is true, nothing but the truth, but it is less than
the whole truth. Truly all that is significant in human history may be
traced back to ideas, but in like manner the ideas themselves can be
traced back to material sources. For ideas have histories, too, and the
causation of an idea must be understood before the idea itself can serve
fully to explain anything. We must go back of the idea to the causes
which gave it birth if we would interpret anything by it. We may trace
the American Revolution, for example, back to the revolutionary ideas of
the colonists, but that will not materially assist us to understand the
Revolution. For that, it is necessary to trace the ideas themselves to
their source, the economic discontent of an exploited people. This is
the spirit which illumines the works of historians like Green, McMaster,
Morse Stephens, and others of the modern school, who emphasize social
forces rather than individual facts, and find the _geist_ of history in
social experiences and institutions.

What has been called the "Great Man theory," the theory according to
which Luther created the Protestant Reformation, to quote only one
example, and which ignored the great economic changes consequent upon
the break-up of feudalism and the rise of a new industrial order, long
dominated our histories. According to this theory, an idea, developed in
the mind of Luther, independent of external circumstances, changed the
political and social life of Europe. Had there been no Luther, there
would have been no Reformation; or had Luther died before giving his
idea to the world, the Reformation would have been averted. The student
who seeks in the bulk of the histories written prior to, say, 1870, what
he has a legitimate reason for seeking, namely, a picture of the actual
life of the people at any period, will be sadly disappointed. He will
find records of wars and treaties of peace, royal genealogies and
gossip, wildernesses of names and dates. But he will not find such
careful accounts of the jurisprudence of the period, nor any hint of the
economical conditions of its development. He will find splendid accounts
of court life, with its ceremonials, scandals, intrigues, and follies;
but no such pictures of the lives of the people, their social
conditions, and the methods of labor and commerce which obtained. He
will be unable to visualize the life of the period. In other words, the
histories lack realism; they are unreal, and, therefore, deceptive. The
new spirit, in the development of which the materialist conception of
Marx and Engels has been an important creative influence, is concerned
less with the chronicle of notable events and dates than with their
underlying causes and the manner of life of the people. Had it no other
bearing, the Marx-Engels theory, considered solely as a contribution to
the science of history, would have been one of the greatest intellectual
achievements of the nineteenth century. By emphasizing the importance of
the economic factors in social evolution, it has done much for economics
and more for history.[63]


While the Materialistic Conception of History bears the names of Marx
and Engels, as the theory of organic evolution bears the names of Darwin
and Wallace, it is not claimed that the idea had never before been
expressed. Just as thousands of years before Darwin and Wallace the
theory which bears their names had been dimly perceived, so the idea
that economic conditions dominate historical developments had its
foreshadowings. The famous dictum of Aristotle, that only by the
introduction of machines would the abolition of slavery ever be made
possible, is a conspicuous example of many anticipations of the theory.
It is true that "In dealing with speculations so remote, we have to
guard against reading modern meanings into writings produced in ages
whose limitations of knowledge were serious, whose temper and standpoint
are wholly alien to our own,"[64] but the Aristotelian saying admits of
no other interpretation. It is clearly a recognition of the fact that
the supreme politico-social institution of the time depended upon hand

In later times, the idea of a direct connection between economic
conditions and legal and political institutions reappears in the works
of various writers. Professor Seligman[65] quotes from Harrington's
"Oceana" the argument that the prevailing form of government depends
upon the conditions of land tenure, and the extent of its
monopolization. Saint-Simon, too, as already stated, taught that
political institutions depend upon economic conditions. But it is to
Marx and Engels that we owe the first formulation into a definite theory
of what had hitherto been but a suggestion, and the beginnings of a
literature, now of considerable proportions, dealing with history from
its standpoint. No more need be said concerning the "originality" of the

A word as to the designation of the theory. Its authors gave it the name
"historical materialism," and it has been urged that the name is, for
many reasons, unfortunately chosen. Two of the leading exponents of the
theory, Professor Seligman and Mr. Ghent, the former an opponent, the
latter an advocate of Socialism, have expressed this conviction in very
definite terms. The last-named writer bases his objection to the name on
the ground that it is repellent to many persons who associate the word
materialism with the philosophy "that matter is the only substance, and
that matter and its motions constitute the universe."[66] That is an old
objection, and undoubtedly contains much truth. It is interesting in
connection therewith to read the sarcastic comment of Engels upon it in
the introduction to his "Socialism, Utopian and Scientific." The
objection of Professor Seligman is based upon another ground entirely.
He impugns its accuracy. "The theory which ascribes all changes in
society to the influence of climate, or to the character of the fauna
and flora, is materialistic," he says, "and yet has little in common
with the doctrine here discussed. The doctrine we have to deal with is
not only materialistic, but also economic in character; and the better
phrase is ... the 'economic interpretation' of history."[67] For this
reason he discards the name given to the theory by its authors and
adopts the luminous phrase of Thorold Rogers, without credit to that

By French and Italian writers the term "economic determinism" has long
been used, and it has been adopted to some extent in this country by
Socialist writers. But this term, as Professor Seligman points out, is
objectionable, because it exaggerates the theory, and gives it, by
implication, a fatalistic character, conveying the idea that economic
influence is the _sole_ determining factor--a view which its authors
specifically repudiated. While the reasoning of Professor Seligman in
the argument quoted against the name "historical materialism" is neither
very profound nor conclusive, since climate and fauna and flora are
included in the term "economic" as clearly as in the term
"materialistic," much may be said in favor of his choice of the term he
borrows from Thorold Rogers, and it is used by many Socialist writers in
preference to that used by Marx and Engels.

Many persons have doubtless been deceived into believing that the theory
involves the denial of all influence to idealistic or spiritual factors,
and the assumption that economic forces _alone_ determine the course of
historical development. Much of the criticism of the theory, especially
by the Germans, rests upon that assumption. The theory is attacked,
also, as being sordid and brutal upon the same false assumption that it
implies that men are governed solely by their economic _interests_, that
individual conduct is never inspired by anything higher than the
economic interest of the individual. These are misconceptions of the
theory, due, no doubt, to the overemphasis placed upon it by its
authors--a common experience of new doctrines--and, above all, the
exaggerations of too zealous, unrestrained disciples. There is a wise
saying of Schiller's which suggests the spirit in which these
exaggerations of a great truth--exaggerations by which it becomes
falsehood--should be regarded: "Rarely do we reach truth, except through
extremes--we must have foolishness ... even to exhaustion, before we
arrive at the beautiful goal of calm wisdom."[68] When it is contended
that the "Civil War was at bottom a struggle between two economic
principles,"[69] we have the presentation of an important truth, the key
to the proper understanding of a great historical event. But when that
important fact is exaggerated and torn from its legitimate place to suit
the propaganda of a theory, and we are asked to believe that Garrison,
Lovejoy, and other abolitionists were inspired solely by economic
motives, that the urge and passion of human freedom did not enter into
their souls, we are forced to reject it. But let it be clearly
understood that it forms no part of the theory, that it is even
expressly denied in the very terms in which Marx and Engels formulated
the theory, and that its authors repudiated such perversions of it.

In no respect has the theory been more grossly exaggerated and
misrepresented than in its application to religion. True philosopher
that he was, Marx realized the absurdity of attempting "to abstract
religious sentiment from the course of history, to place it by
itself."[70] He recognized that all religion is, fundamentally, man's
effort to put himself into harmonious relation with, and to discover an
interpretation of, the forces of the universe. The more incomprehensible
those forces, the greater man's need of an explanation of them. He could
not fail to see that the religion of a people always bears a marked
relation to their mental development and their special environment. He
knew that at various stages the Yahve of the Hebrews represented very
different conceptions, answering to changes in the social and political
conditions of the people. To the primitive Israelitish tribes, Yahve
was, as Professor Rauschenbusch remarks,[71] a tribal god, fortunately
stronger than the gods of the neighboring tribes, but not fundamentally
different from them, and the way to win his favor was to sacrifice
abundantly. Later, with the development of a national spirit, the
religious ideal became a theocracy, and Yahve became a King and Supreme
Lord. In times of oppression and war Yahve was a God of War, but under
other conditions he was a God of Peace. At every step the conception of
Yahve bears a very definite relation to the material life.[72]

Marx knew that primitive religions have often a celestial pantheon
fashioned after the existing social order, kings being gods, aristocrats
being demigods, and common mortals occupying a celestial rank equal to
their terrestrial one. The celestial hierarchy of the Chinese, for
example, is an exact reproduction of the earthly hierarchy, and all the
privileges of rank are observed celestially as on earth. So in India we
find the religions reproducing in their concepts of heaven the degrees
and divisions of the various castes,[73] while our own American Indian
conceived of a celestial hunting ground, with abundant reward of game,
as his Paradise. "The religious world is but the reflex of the real
world," said Marx,[74] and the phrase has been used, both by disciples
and critics, as an attack upon religion itself; as showing that the
Marxian philosophy excludes the possibility of religious belief.
Obviously, however, the passage will not bear such an interpretation. To
say that "the religious world is but the reflex of the real world" is
by no means to deny that men have been benefited by seeking an
interpretation of the forces of the universe, or to assert that the
quest for such an interpretation is incompatible with rational conduct.
In his scorn for Bakunin's "Alliance" programme with its dogmatic
atheism[75] Marx was perfectly consistent. The passage quoted simply
lays down, in bare outline, a principle which, if well founded, enables
us to study comparative religion from a new viewpoint.

It is not a denial of religion, then, which the famous utterance of Marx
involves, but a recognition of the fact that, even as all religions may
be traced to the same fundamental instinct in mankind, so the different
forms which the religious conception assumes are, or may be, reflexes of
the material life of those making them. Thus man makes religion for
himself under the urge of his deepest instincts. The application of the
theory to religion is analogous to its application to historical events.
To say that a given religion assumes the form it does as an unconscious
reflex of the environment in which it is produced, is no more a denial
of that religion than to say that the Reformation arose out of economic
and social conditions, and not out of an idea in Luther's mind, is a
denial of the fact that there was a Reformation, or that the
Reformation benefited the people. The value of the theory to the study
of religions and religious movements is not less than to the study of
history. Does anybody pretend that we can understand Christianity
without taking into account the Roman Empire; or that we can understand
Catholicism without knowing something of the economic life of medieval
Europe; or Methodism without knowing the social condition of England in
Wesley's day?[76]

In one of the very earliest of his writings upon the subject, some
comments upon the philosophy of Ludwig Feuerbach, and intended to form
the basis of a separate work, we find Marx insisting that man is not a
mere automaton, driven irresistibly by blind economic forces. He says:
"The materialistic doctrine, that men are the products of conditions and
education, different men, therefore, the products of other conditions
and changed education, _forgets that circumstances may be altered by
men, and that the educator has himself to be educated_."[77] Thus early
we see the master taking a position entirely at variance with those of
his disciples who would claim that the human factor has no influence
upon historical development, that man is without power over his own
destiny. From that position Marx never departed. Both he and Engels
recognized the human character of the problem, and the futility of
attempting to reduce all the processes of history and human progress to
one sole basic cause. And in no case, so far as I am aware, has either
of them attempted to do this.

In another place, Marx contends that "men make their own history, but
they make it not of their own accord or under self-chosen conditions,
but under given and transmitted conditions. The tradition of all dead
generations weighs like a mountain upon the brain of the living."[78]
Here, again, the influence of the human will is not denied, though its
limitations are indicated. This is the application to social man of the
theory of limitations of the will commonly accepted as applying to
individuals. Man is only a freewill agent within certain sharp and
relatively narrow bounds. In a given contingency, I may be "free" to act
in a certain manner, or to refrain from so acting. I may take my choice,
in the one direction or the other, entirely free, to all appearances,
from restraining or compelling influences. Thus, I have acted upon my
"will." But what factors formed my will? What circumstances determined
my decision? Perhaps fear, or shame, or pride; perhaps tendencies
inherited from my ancestors.

Engels admits that the economic factor in evolution has sometimes been
unduly emphasized. He says: "Marx and I are partly responsible for the
fact that the younger men have sometimes laid more stress on the
economic side than it deserves. In meeting the attacks of our opponents,
it was necessary for us to emphasize the dominant principle denied by
them; and we did not always have the time, place, or opportunity to let
the other factors which were concerned in the mutual action and reaction
get their deserts."[79] In another letter,[80] he says: "According to
the materialistic view of history, the factor which is in _last
instance_ decisive in history is the production and reproduction of
actual life. More than this neither Marx nor I have ever asserted. But
when any one distorts this so as to read that the economic factor is the
sole element, he converts the statement into a meaningless, abstract,
absurd phrase. The economic condition is the basis; but the various
elements of the superstructure,--the political forms of the class
contests, and their results, the constitutions,--the legal forms, and
also all the reflexes of these actual contests in the brains of the
participants, the political, legal, philosophical theories, the
_religious views_ ... all these exert an influence on the development of
the historical struggles, and, in many instances, determine their form."

It is evident, therefore, that the doctrine does not imply economic
fatalism. It does not deny that ideals may influence historical
developments and individual conduct. While, as we shall see in a later
chapter, it is part of the doctrine that classes are formed upon a basis
of unity of material interests, it does not deny that men may, and often
do, act in accordance with the promptings of noble impulses and
humanitarian ideals, when their material interests would lead them to do
otherwise. We have a conspicuous example of this in the life of Marx
himself; in his splendid devotion to the cause of the workers through
years of terrible poverty and hardship when he might have chosen wealth
and fame. It is known, for example, that Bismarck made the most
extravagant offers to enlist the services of Marx, who declined them at
the very time when he was suffering awful privations. Marx himself has
noted more than one instance of individual idealism triumphing over
material interests and class environment, and, by a perversity that is
astonishing, and not wholly disingenuous, some of his critics, notably
Ludwig Slonimski,[81] have used these instances as arguments against his
theory, claiming that they disprove it! We are to understand the
materialistic theory, then, as teaching, not that history is determined
by economic forces only, but that in human evolution the chief factors
are social factors, and that these factors in turn are _mainly_ molded
by economic circumstances.[82]

This, then, is the basis of the Socialist philosophy, which Engels
regarded as "destined to do for history what Darwin's theory has done
for biology." Marx himself made a similar comparison.[83] Marx was, so
Liebknecht tells us, one of the first to recognize the importance of
Darwin's investigations to sociology. His first important treatment of
the materialistic theory, in "A Contribution to the Critique of
Political Economy," appeared in 1859, the year in which "The Origin of
Species" appeared. "We spoke for months of nothing else but Darwin, and
the revolutionizing power of his scientific conquests,"[84] says
Liebknecht. Darwin, however, had little knowledge of political economy,
as he acknowledged in a letter to Marx, thanking the latter for a copy
of "Das Kapital." "I heartily wish that I possessed a greater knowledge
of the deep and important subject of economic questions, which would
make me a more worthy recipient of your gift," he wrote.[85]


The test of such a theory must lie in its application. Let us, then,
apply the materialistic principle, first to a specific event, and then
to the great sweep of the historic drama. Perhaps no single event has
more profoundly impressed the imaginations of men, or filled a more
important place in our histories, than the discovery of America by
Columbus. In the schoolbooks, this great event figures as a splendid
adventure, arising out of a romantic dream. But the facts are, as we
know, far otherwise.[86] In the twelfth and thirteenth centuries there
were numerous and well-frequented routes from Hindustan, that vast
storehouse of treasure from which Europe drew its riches. Along these
routes cities flourished. There were the great ports, Licia in the
Levant, Trebizond on the Black Sea, and Alexandria. From these ports,
Venetian and Genoese traders bore the produce over the passes of the
Alps to the Upper Danube and the Rhine. Here it was a source of wealth
to the cities along the waterways, from Ratisbon and Nuremburg, to
Bruges and Antwerp. Even the slightest acquaintance with the history of
the Middle Ages must suffice to give the student an idea of the
importance of these cities.

When all these routes save the Egyptian were closed by the hordes of
savages which infested Central Asia, it became an easy matter for the
Moors in Africa and the Turks in Europe to exact immense revenues from
the Eastern trade, solely through their monopoly of the route of
transit. Thus there developed an economic parasitism which crippled the
trade with the East. The Turks were securely seated at Constantinople,
threatening to advance into the heart of Europe, and building up an
immense military system out of the taxes imposed upon the trade of
Europe with the East--a military power, which, in less than a quarter of
a century, enabled Selim I to conquer Mesopotamia and the holy towns of
Arabia, and to annex Egypt.[87] It became necessary, then, to find a new
route to India; and it was this great economic necessity which set
Columbus thinking of a pathway to India over the Western Sea. It was
this same great problem which engaged the attention of all the
navigators of the time; it was this economic necessity which induced
Ferdinand and Isabella to support the adventurous plan of Columbus. In a
word, without detracting in any manner from the splendid genius of
Columbus, or from the romance of his great voyage of discovery, we see
that, fundamentally, it was the economic interest of Europe which gave
birth to the one and made the other possible. The same explanation
applies to the voyage of Vasco da Gama, six years later, which resulted
in finding a way to India over the southeast course by way of the Cape
of Good Hope.

Kipling asks in his ballad, "The British Flag"--

     "And what should they know of England, who only England know?"

There is a profound truth in the defiant line, a truth which applies
equally to America or any other country. The present is inseparable from
the past. We cannot understand one epoch without reference to its
predecessors; we cannot understand the history of the United States
unless we seek the key in the history of Europe--of England and France
in particular. At the very threshold, in order to understand how the
heroic navigator came to discover the vast continent of which the United
States is part, we must pause to study the economic conditions of Europe
which impelled the adventurous voyage, and led to the discovery of a
great continent stretching across the ocean path. Such a view of history
does not rob it of its romance, but rather adds to it. Surely, the
wonderful linking of circumstances--the demand for spices and silks to
minister to the fine tastes of aristocratic Europe, the growth of the
trade with the East Indies, the grasping greed of Moor and Turk--all
playing a rôle in the great drama of which the discovery of America is
but a scene, is infinitely more fascinating than the latter event
detached from its historical setting!

It is not easy to give in the compass of a few pages an intelligent view
of the main currents of history. The sketch here introduced--not without
hesitation--is an endeavor to state the Socialist concept of the course
of social evolution in a brief outline and to indicate the principal
economic causes which have operated to determine that course.

It is now generally admitted that primitive man lived under Communism.
Lewis H. Morgan[88] has calculated that if the life of the human race be
assumed to have covered one hundred thousand years, at least ninety-five
thousand years were spent in a crude, tribal Communism, in which private
property was practically unknown, and in which the only ethic was
devotion to tribal interests, and the only crime antagonism to tribal
interests. Under this social system the means of making wealth were in
the hands of the tribes, or _gens_, and distribution was likewise
socially arranged. Between the different tribes warfare was constant,
but in the tribe itself there was coöperation and not struggle. This
fact is of tremendous importance in view of the criticisms which have
been directed against the Socialist philosophy from the so-called
Darwinian point of view, according to which competition and struggle is
the law of life; that what Professor Huxley calls "the Hobbesial war of
each against all" is the normal state of existence.

This is described as "the so-called Darwinian" theory advisedly, for the
struggle for existence as the law of evolution has been exaggerated out
of all likeness to the conception of Darwin himself. In "The Descent of
Man," for instance, Darwin raises the point under review, and shows how,
in many animal societies, the _struggle_ for existence is replaced by
_coöperation_ for existence, and how that substitution results in the
development of faculties which secure to the species the best conditions
for survival. "Those communities," he says, "which included the greatest
number of the most sympathetic members, would flourish best and rear the
greatest number of offspring."[89] Despite these instances, and the
warning of Darwin himself that the term "struggle for existence" should
not be too narrowly interpreted or overrated, his followers, instead of
broadening it according to the master's suggestions, narrowed it still
more. Thus the theory has been exaggerated into a mere caricature of the
truth. This is almost invariably the fate of theories which deal with
human relations, perhaps it would be equally true to say of all
theories. The exaggerations of Malthus's law of population is a case in
point. The Marx-Engels theory of the materialistic conception of history
is, as we have seen, another.

Kropotkin, among others, has developed the theory along the lines
suggested by Darwin. He points out that "though there is an immense
amount of warfare and extermination going on amidst various classes of
animals, there is, at the same time, as much, or perhaps even more, of
mutual support, mutual aid, mutual defense, amidst animals belonging to
the same species or, at least, to the same society. Sociability is as
much a law of nature as mutual struggle.... If we resort to an indirect
test, and ask nature: 'Who are the fittest: those who are continually at
war with each other, or those who support one another?' we at once see
that those animals which acquire habits of mutual aid are undoubtedly
the fittest. They have more chances to survive, and they attain, in
their respective classes, the highest development of intelligence and
bodily organization. If the numberless facts which can be brought
forward to support this view are taken into account, we may safely say
that mutual aid is as much a law of animal life as mutual struggle, but
that, as a factor of evolution, it most probably has a far greater
importance, inasmuch as it favors the development of such habits and
characters as insure the maintenance and further development of the
species, together with the greatest amount of welfare and enjoyment of
life for the individual, with the least waste of energy."[90]

From the lowest forms of animal life up to the highest, man, this law
proves to be operative. It is not denied that there is competition for
food, for life, within the species, human and other. But that
competition is not usual; it arises out of unusual and special
conditions. There are instances of hunger-maddened mothers tearing away
food from their children; men drifting at sea have fought for water and
food as beasts fight, but these are not normal conditions of life.
"Happily enough," says Kropotkin again, "competition is not the rule
either in the animal world or in mankind. It is limited among animals to
exceptional periods.... Better conditions are created by the
_elimination of competition_ by means of mutual aid and mutual
support."[91] This is the voice of science now that we have passed
through the extremes and arrived at the "beautiful goal of calm wisdom."
Competition is not, in the verdict of modern science, the law of life,
but of death. Strife is not nature's way of progress.

Anything more important to our present inquiry than this verdict of
science it would be difficult to imagine. Men have for so long believed
and declared struggle and competition to be the "law of nature," and
opposed Socialism on the ground of its supposed antagonism to that law,
that this new conception of nature's method comes as a vindication of
the Socialist position. The naturalist testifies to the universality of
the principle of coöperation throughout the animal world, and the
historian and sociologist to its universality throughout the greatest
part of man's history. Present economic tendencies toward combination
and away from competition, in industry and commerce, appear as the
fulfilling of a great universal law. And the vain efforts of men to stop
that process, by legislation, boycotts, and divers other methods, appear
as efforts to set aside immutable law. Like so many Canutes, they bid
the tides halt, and, like Canute's, their commands are vain and mocked
by the unheeding tides.

Under Communism, then, man lived for many thousands of years. As far
back as we can go into the paleo-ethnology of mankind, we find evidences
of this. All the great authorities, Morgan, Maine, Lubbock, Taylor,
Bachofen, and many others, agree in this. And under this Communism all
the great fundamental inventions were evolved, as Morgan and others have
shown. The wheel, the potter's wheel, the lever, the stencil plate, the
sail, the rudder, the loom, were all evolved under Communism in its
various stages. So, too, the cultivation of cereals for food, the
smelting of metals, the domestication of animals,--to which we owe so
much, and on which we still so largely depend,--were all introduced
under Communism. Even in our day there have been found many survivals of
this Communism among primitive peoples. Mention need only be made here
of the Bantu tribes of Africa, whose splendid organization astonished
the British, and the Eskimos. It is now possible to trace with a fair
amount of certainty the progress of mankind through various stages of
Communism, from the unconscious Communism of the nomad to the
consciously organized and directed Communism of the most highly
developed tribes, right up to the threshold of civilization, when
private property takes the place of common, tribal property, and
economic classes appear.[92]


Private property, other than that personal ownership and use of things,
such as weapons and tools, which involves no class or caste domination,
and is an integral feature of all forms of Communism, first appears in
the ownership of man by man. Slavery, strange as it may seem, is
directly traceable to tribal Communism, and first appears as a tribal
institution. When one tribe made war upon another, its efforts were
directed to the killing of as many of its enemies as possible. Cannibal
tribes killed their foes for food, rarely or never killing their
fellow-tribesmen for that purpose. Non-cannibalistic tribes killed their
foes merely to get rid of them. But when the power of mankind over the
forces of external nature had reached that point in its development
where it became relatively easy for a man to produce more than was
necessary for his own maintenance, the custom arose of making captives
of enemies and setting them to work. A foe captured had thus an economic
value to the tribe. Either he could be set to work directly, his surplus
product enriching the tribe, or he could be used to relieve some of his
captors from other necessary duties, thus enabling them to produce more
than would otherwise be possible, the effect being the same in the end.
The property of the tribe at first, slaves become at a later stage
private property--probably through the institution of the tribal
distribution of wealth. Cruel, revolting, and vile as slavery appears to
our modern sense,--especially the earlier forms of slavery before the
body of legislation, and, not less important, sentiment, which
surrounded it later arose,--it still was a step forward, a distinct
advance upon the older customs of cannibalism and wholesale slaughter.

Nor was it a progressive step only on the humanitarian side. It had
other, profounder consequences from the evolutionary point of view. It
made a leisure class possible, and provided the only conditions under
which art, philosophy, and jurisprudence could be evolved. The secret of
Aristotle's saying, that only by the invention of machines would the
abolition of slavery ever be made possible, lies in his recognition of
the fact that the labor of slaves alone made possible the devotion of a
class of men to the pursuit of knowledge instead of to the production of
the primal necessities of life. The Athens of Pericles, for example,
with all its varied forms of culture, its art and its philosophy, was a
semi-communism of a caste above, resting upon a basis of slave labor
underneath. Similar conditions prevailed in all the so-called ancient
democracies of civilization.

The private ownership of wealth producers and their products made
private exchange inevitable; individual ownership of land took the place
of communal ownership, and a monetary system was invented. Here, then,
in the private ownership of land and laborer, private production and
exchange, we have the economic factors which caused the great revolts of
antiquity, and led to that concentration of wealth into few hands, with
its resulting mad luxury on the one hand and widespread proletarian
misery upon the other, which conspired to the overthrow of Greek and
Roman civilization. The study of those relentless economic forces which
led to the break-up of Roman civilization is important as showing how
chattel slavery became modified and the slave to be regarded as a serf,
a servant bound to the soil. The lack of adequate production, the
crippling of commerce by hordes of corrupt officials, the overburdening
of the agricultural estates with slaves, so that agriculture became
profitless, the crushing out of free labor by slave labor, and the rise
of a wretched class of freemen proletarians, these, and other kindred
causes, led to the breaking up of the great estates; the dismissal of
superfluous slaves, in many cases, and the partial enfranchisement of
others by making them hereditary tenants, paying a fixed share of their
product as rent--here we have the embryonic stage of feudalism. It was a
revolution, this transformation of the social system of Rome, of
infinitely greater importance than the sporadic risings of a few
thousand slaves. Yet, such is the lack of perspective which the
historians have shown, it is given a far less important place in the
histories than the risings in question. Slavery, chattel slavery, died
because it had ceased to be profitable; serf labor arose because it was
more profitable. Slave labor was economically impossible, and the labor
of free men was morally impossible; it had, thanks to the slave system,
come to be regarded as a degradation. In the words of Engels, "This
brought the Roman world into a blind alley from which it could not
escape.... There was no other help but a complete revolution."[93]

The invading barbarians made the revolution complete. By the poor
freemen proletarians who had been selling their children into slavery,
the barbarians were welcomed. Misery, like opulence, has no patriotism.
Many of the proletarian freemen had fled to the districts of the
barbarians, and feared nothing so much as a return to Roman rule. What,
then, should the proletariat care for the overthrow of the Roman state
by the barbarians? And how much less the slaves, whose condition,
generally speaking, could not possibly change for the worse? The free
proletarian and the slave could join in saying, as men have said
thousands of times in circumstances of desperation:--

     "Our fortunes may be better; they can be no worse."


Feudalism is the essential politico-economic system of the Middle Ages.
Obscure as its origin is, and indefinite as the date of its first
appearances, there can be no doubt whatever that the break-up of the
Roman system, and the modification of the existing form of slavery,
constituted the most important of its sources. Whether, as some writers
have contended, the feudal system of land tenure and serfdom is
traceable to Asiatic origins, being adopted by the ruling class of Rome
in the days of the economic disintegration of the empire, or whether it
rose spontaneously out of the Roman conditions, matters little to us.
Whatever its archæological interest, it does not affect the narrower
scope of our present inquiry whether economic necessity caused the
adoption of an alien system of land tenure and agricultural production,
or whether economic necessity caused the creation of a new system. The
central fact is the same in either case.

That period of history which we call the Middle Ages covers a span of
well-nigh a thousand years. If we arbitrarily date its beginning from
the successful invasion of Rome by the barbarians in the early part of
the fifth century, and its ending with the final development of the
craft guilds in the middle of the fourteenth century, we have a
sufficiently exact measure of the time during which feudalism developed,
flourished, and declined. There are few things more difficult than the
bounding of epochs in social evolution by exact dates. Just as the
ripening of the wheat fields comes almost imperceptibly, so that the
farmer can say when the wheat is ripe, yet cannot say when the ripening
occurred, so with the epochs into which social history divides itself.
There is the unripe state and the ripe, but no chasm yawns between them;
they are merged together. We speak of the "end" of chattel slavery, and
the "rise" of feudalism, therefore, in a wide, general sense. As a
matter of fact, chattel slavery survived to some extent for centuries,
existing alongside of the new form of servitude; and its disappearance
took place, not simultaneously throughout the civilized world, but at
varying intervals. Likewise, there is a vast difference between the
first, crude, ill-defined forms of feudalism and its subsequent

The theory of feudalism is the "divine right of kings." God is the
Supreme Lord of all the earth, the kings are His vice-regents, devolving
their authority in turn upon whomsoever they will. All land is held as
belonging to the king, God's chosen representative. He divides the realm
among his barons, to rule over and defend. For this they pay tribute to
the king--military service in times of war and, at a later period,
money. In turn, the barons divide the land among the lesser nobility,
receiving tribute from them. By these divided among the freemen, who
also pay tribute, the land is tilled by the serfs, who pay service to
the freeman, the lord of the manor. The serf pays no tribute directly to
the king, only to his liege lord; the liege lord pays to his superior,
and so on, up to the king. This is the economic framework of feudalism;
with its ecclesiastical side we are not here concerned.

At the base of the whole superstructure, then, was the serf, his
relation to his lord differing only in degree, though in material
degree, from that of the chattel slave. He might be, and often was, as
brutally ill-treated as the slave before him had been; he might be
ill-fed and ill-housed; his wife or daughters might be ravished by his
master or his master's sons. Yet, withal, his condition was better than
that of the slave. He could maintain his family life in an independent
household; he possessed some rights, chief of which perhaps was the
right to labor for himself. Having his own allotment of land, he was in
a much larger sense a human being. Compelled to render so many days'
service to his lord, tilling the soil, clearing the forest, quarrying
stone, and doing domestic work, he was permitted to devote a certain,
often an equal, number of days to work for his own benefit. Not only so,
but the service the lord rendered him, in protecting him and his family
from the lawless and violent robber hordes which infested the country,
was considerable.

The feudal estate, or manor, was an industrial whole, self-dependent,
and having few essential ties binding it to the outside world. The
barons and their retainers, lords, thanes, and freemen, enjoyed a
certain rude plenty, some of the richer barons enjoying a considerable
amount of luxury and splendor. The _villein_ and his sons tilled the
soil, reaped the harvests, felled trees for fuel, built the houses,
raised the necessary domestic animals, and killed the wild animals; his
wife and daughters spun the flax, carded the wool, made the homespun
clothing, brewed the mead, and gathered the grapes which they made into
wine. There was little real dependence upon the outside world except
for articles of luxury.

Such was the basic economic institution of feudalism. But alongside of
the feudal estate with its serf labor, there were the free laborers, no
longer regarding labor as shameful and degrading. These free laborers
were the handicraftsmen and free peasants, the former soon organizing
themselves into guilds. There was a specialization of labor, but, as
yet, little division. Each man worked at a particular craft and
exchanged his individual products. The free craftsman would exchange his
product with the free peasant, and sometimes his trade extended to the
feudal manor. The guild was at once his master and protector; rigid in
its rules, strict in its surveillance of its members, it was strong and
effective as a protector against the impositions and invasions of feudal
barons and their retainers. Division of labor first appears in its
simplest form, the association of independent individual workers for
mutual advantage, sharing their products upon a basis of equality. This
simple coöperation involved no fundamental, revolutionary change in
society. That came later with the development of the workshop system,
and the division of labor upon a definite, predetermined plan. Men
specialized now in the making of _parts_ of things; no man could say of
a finished product, "This is _mine_, for I made it." Production had
become a social function.


At first, in its simple beginnings, the coöperation of many producers in
one great workshop did not involve any general or far-reaching changes
in the system of exchange. But as the new methods spread, and it became
the custom for one or two wealthy individuals to provide the workshop
and necessary tools and materials for production, the product of the
combined laborers being appropriated in its entirety by the owners of
the agencies of production, who paid the workers a money wage
representing less than the actual value of their product, and based upon
the cost of their subsistence, the whole economic system was once more
revolutionized. The custom of working for wages, hitherto rare and
exceptional, became general and customary; individual production for
use, either directly or through the medium of personal exchange, was
superseded by social production for private profit. The wholesale
exchange of social products for private gain took the place of the
personal exchange of commodities. The difference between the total cost
of the production of commodities, including the wages of the producers,
and their exchange value--determined at this stage by the cost of
producing similar commodities by individual labor--constituted the share
of the capitalist, his profit, and the objective of his investment.

The new system did not spring up spontaneously and full-fledged. Like
feudalism, it was a growth, a development of existing forms. And just as
chattel slavery lingered on after the rise of the feudal régime, so the
old methods of individual production and direct exchange of commodities
for personal use lingered on in places and isolated industries long
after the rise of the system of wage-paid labor and production for
profit. But the old methods of production and exchange gradually became
rare and almost obsolete. In accordance with the stern economic law that
Marx afterward developed so clearly, the man whose methods of
production, including his tools, are less efficient and economical than
those of his fellows, thereby making his labor more expensive, must
either adapt himself to the new conditions or fall in the struggle which
ensues. The triumph of the new system of capitalist production, with its
far greater efficiency arising from associated production upon a plan of
specialized division of labor, was, therefore, but a question of time.
The class of wage-workers thus gradually increased in numbers; as men
found that they were unable to compete with the new methods, they
accepted the inevitable and adapted themselves to the new conditions.
The industrial revolution which established capitalism was, like the
great revolutions which ushered in preceding social epochs, the product
of man's tools.


[60] Edward Clodd, _Pioneers of Evolution from Thales to Huxley_, page

[61] _Socialism and Modern Science_, by Enrico Ferri, page 96.

[62] _Studies in the Evolution of Industrial Society_, by R. T. Ely,
page 3.

[63] Cf. Seligman, _The Economic Interpretation of History_.

[64] Clodd, _Pioneers of Evolution from Thales to Huxley_, page 8.

[65] Seligman, _The Economic Interpretation of History_, page 50.

[66] _Mass and Class_, by W. J. Ghent, page 9.

[67] Seligman, _The Economic Interpretation of History_, page 4.

[68] Schiller, _Philosophical Letters_, Preamble.

[69] Seligman, _The Economic Interpretation of History_, page 86.

[70] Karl Marx, _Notes on Feuerbach_ (written in 1845), published as an
Appendix to _Feuerbach, The Roots the Socialist Philosophy_, by
Friederich Engels. English translation by Austin Lewis (1903).

[71] _Christianity and the Social Crisis_, by Walter Rauschenbusch
(1907), page 4.

[72] For a very scholarly discussion of this subject, the reader is
referred to the series of articles by my friend, M. Beer, on _The Rise
of Jewish Monotheism_, in the _Social Democrat_ (London), 1908.

[73] Cf. _The Economic Foundations of Society_, by Achille Lorio, page

[74] _Capital_, by Karl Marx (Kerr edition). Vol. I, page 91.

[75] Cf. _Karl Marx on Sectarianism and Dogmatism_ (A letter written to
his friend, Bolte), in the _International Socialist Review_, March,
1908, page 525.

[76] Very significant of the possibilities of a study of religious
movements from this economic and social viewpoint is Professor Thomas C.
Hall's little book, _The Social Meaning of Modern Religious Movements in
England_ (1900).

[77] Appendix to F. Engels' _Feuerbach, the Roots of the Socialist
Philosophy_, translated by Austin Lewis, 1903.

[78] _The Eighteenth Brumaire._

[79] Quoted from _The Sozialistische Akademiker_, 1895, by Seligman,
_The Economic Interpretation of History_, page 142.

[80] _Idem_, page 143.

[81] _Karl Marx's Nationaloekonomische Irrlehren_, von Ludwig Slonimski,
Berlin, 1897.

[82] I have not attempted to give a history of the development of the
theory. For a more minute study of the theory, I must refer the reader
to the writings of Engels, Seligman, Ferri, Ghent, Bax, and others
quoted in these pages.

[83] _Capital_, Vol. I, page 406 n. (Kerr edition).

[84] Liebknecht, _Memoirs of Karl Marx_, page 91.

[85] _Charles Darwin and Karl Marx, A Comparison_, by Edward Aveling,
London, 1897.

[86] See Thorold Rogers, _The Economic Interpretation of History_,
second edition, 1891, pages 10-12.

[87] For various reasons, chief of which is that it would take me too
far away from my present purpose, I do not attempt to develop the
serious consequences of these events to Europe. See _The Economic
Interpretation of History_, Chapter I, for a brief account of this.

[88] _Ancient Society, or Researches in the Lines of Human Progress from
Savagery through Barbarism to Civilization_, by Lewis H. Morgan. New
edition, Chicago, 1907.

[89] Darwin, _The Descent of Man_, second edition, page 163.

[90] _Mutual Aid a Factor of Evolution_, by Peter Kropotkin, pages 5-6.

[91] _Idem_, page 74.

[92] Cf. _Ancient Society_, by Lewis H. Morgan, and _The Origins of the
Family, Private Property, and the State_, by Friederich Engels.

[93] Engels, _Origin of the Family, Private Property, and the State_, p.




Such was the mode of the development of capitalistic production in its
first stage. In this stage a permanent wage-working class was formed,
new markets were developed, many of them by colonial expansion and
territorial conquest, and production for sale and profit became the
rule, instead of the exception as formerly when men produced primarily
for use and sold only their surplus products. A new form of class
division thus arose out of this economic soil. Instead of being bound to
the land as the serfs had been under feudalism, the wage-workers were
bound to their tools. They were not bound to a single master, they were
not branded on the cheek, but they were, nevertheless, dependent upon
the industrial lords. Economic mastery gradually shifted from the
land-owning class to the class of manufacturers. The political and
social history of the Middle Ages is largely the record of the struggle
for supremacy which was waged between these two classes. That struggle
is the central fact of the Protestant Reformation and the Cromwellian

The second stage of capitalism begins with the birth of the machine age;
the introduction of the great mechanical inventions of the latter half
of the seventeenth century, and the resulting industrial revolution, the
salient features of which we have already traced. That revolution
centered in England, whose proud but, from all other points of view than
the commercial, foolish boast for a full century it was to be "the
workshop of the world." The new methods of production, and the
development of trade with India, and the colonies and the United States
of America, providing a vast and apparently almost unlimited market, a
tremendous rivalry was created among the people of England, tauntingly,
but with less originality than bitterness, designated "a nation of
shopkeepers" by Napoleon the First. Competition flourished and commerce
grew under its mighty urge. Quite naturally, therefore, competition came
to be regarded as "the life of trade," and the one supreme law of
progress by British economists and statesmen. The economic conditions of
the time fostered a sturdy individualism on the one hand, expressing
itself in a policy of _laissez faire_, which, paradoxically, they as
surely destroyed. The result was the paradox of a nation of theoretic
individualists becoming, through its poor laws, and more especially
through the vast body of industrial legislation which developed in
spite of theories of _laissez faire_, a nation of practical

The third and last stage of capitalism is characterized by new forms of
industrial ownership, administration, and control. Concentration of
industry and the elimination of competition are the distinguishing
features of this stage. When, more than half a century ago, the
Socialists predicted an era of industrial concentration and monopoly as
the outcome of the competitive struggles of the time, their prophecies
were mocked and derided. Yet, at this distance of time, it is easy to
see what they were foresighted enough to envisage in the future; easy
enough to see that competition carries in its bosom the germs of its own
inevitable destruction. In words which, as Professor Ely says,[94] seem
to many, even non-Socialists, like a prophecy, Karl Marx argued that the
business units in production would continuously increase in magnitude,
until at last monopoly emerged from the competitive struggle. This
monopoly becoming a shackle upon the system under which it has grown up,
and thus becoming incompatible with capitalist conditions, socialization
must, according to Marx, naturally and necessarily follow.[95] In this
as in all the utterances of Marx upon the subject we are reminded of
the distinction which must be made between Socialism as he conceived it
and the Socialism of the Utopians. We never get away from the law of
economic interpretation. Socialism, according to Marx, will develop out
of capitalist society, and follow capitalism necessarily and inevitably.
It is not a plan to be adopted, but a stage of social development to be


For the moment, we are not concerned with the prediction that Socialism
must follow the full development of capitalism. The important point for
our present study is the predicted growth of monopoly out of
competition, and the manner in which that prediction has been realized.
Concerning the manner and extent of the fulfillment of this prediction,
there have been many keen controversies, both within and without the
ranks of the followers of Marx. While Marx and Engels are properly
regarded as the first scientific Socialists, having been the first to
postulate Socialism as the outcome of evolution, and to explore the laws
of that evolution, they were not wholly free from the failings of the
Utopists. It would be unreasonable to expect them to be absolutely free
from the spirit of their age and their associates. There is, doubtless,
something Utopian in the very mechanical conception of capitalist
concentration which Marx held; the process is too simple and sweeping,
the revolution too imminent. Still, by followers and critics alike, it
is generally conceded that the _control_ of the means of production is
being concentrated into the hands of small and ever smaller groups of
capitalists. In recent years the increase in the number of industrial
establishments has not kept pace with the increase in the number of
workers employed, the increase of capital, or the value of the products
manufactured. Not only do we find small groups of men controlling
certain industries, but a selective process is clearly observable,
giving to the same groups of men control of various industries otherwise
utterly unrelated.

In the early stages of the movement toward concentration and
trustification, it was possible to classify the leading capitalists
according to the industries with which they were identified. One set of
capitalists, "Oil Kings," controlled the oil industry; another set,
"Steel Kings," controlled the iron and steel industry; another set,
"Coal Barons," controlled the coal industry, and so on throughout the
industrial and commercial life of the nation. To-day all this has been
changed. An examination of the "Directory of Directors" shows that the
same men control varied enterprises. The Oil King is at the same time a
Steel King, a Coal Baron, a Railway Magnate, and so on. The men who
comprise the Standard Oil group, for instance, are found to control
hundreds of other companies. They include in the scope of their
directorate, banking, insurance, milling, real estate, railroad and
steamship lines, gas companies, sugar, coffee, cotton, and tobacco
companies, and a heterogeneous host of other concerns. Not only so, but
these same men are large holders of investments in all the great
European countries, as well as India, Australia, Africa, Asia, and the
South American countries, while foreign capitalists similarly, but to a
less extent, hold large investments in American companies. Thus, the
concentration of industrial control, through its finance, has become
interindustrial and is rapidly becoming international. The predictions
of Marx are being fulfilled, even though not in the precise manner
anticipated by him.


During recent years there have been many criticisms of the Marxian
theory, aiming to show that this concentration has been, and is, much
more apparent than real. Some of the most important of these criticisms
have come from within the ranks of the Socialist movement itself, and
have been widely exploited as portending the disintegration of the
Socialist movement. _Inter alia_, it may be remarked here that a certain
fretfulness of temper characterizes most of the critics of Socialism.
Strict adherence to the letter of Marx is pronounced as a sign of
intellectual bondage of the movement and its leaders to the "Marxian
fetish," and, on the other hand, every recognition of the human
fallibility of Marx by a Socialist thinker is hailed as a sure portent
of a split in the movement. Yet the most serious criticisms of Marx have
come from the ranks of his followers--perhaps only another sign of the
intellectual bankruptcy of the academic opposition to Socialism.

Of course, Marx was human and fallible. If "Capital" had never been
written, there would still have been a Socialist movement, and if it
could be destroyed by criticism, the Socialist movement would remain.
Socialism is the product of economic conditions, not of a theory or a
book. "Capital" is the intellectual explanation of the genesis of
Socialism, and neither its cause nor an argument for it by which it must
be judged. Hence the futility of such missions as that undertaken by Mr.
W. H. Mallock, for example, based upon the assumption that attacks upon
the text of Marx will serve to destroy or seriously hinder the living
movement. Like a prophet's rebuke to these critics, as well as to those
within the ranks of the Socialist movement who would make of the words
of Marx and Engels fetters to bind the movement to a dogma, come the
words of Engels, published recently, letters in which he writes
vigorously to his friend Sorge concerning the working-class movement in
England and America. Of his compatriots, the handful of German Socialist
exiles in America, who sought to make the American workers swallow a
mass of ill-digested Marxian theory, he writes, "The Germans have never
understood how to apply themselves from their theory to the lever which
could set the American masses in motion; to a great extent they do not
understand the theory itself and treat it in a doctrinaire and dogmatic
fashion.... It is a credo to them, not a guide to action." And again,
"Our theory is not a dogma, but the exposition of a process of
evolution, and that process involves several successive phases." Of the
English movement he writes, "And here an instinctive Socialism is more
and more taking possession of the masses which, _fortunately_, is
opposed to all distinct formulation according to the dogmas of one or
the other so-called organizations," and again, he condemns "the bringing
down of the Marxian theory of development to a rigid orthodoxy."[96] The
critics who hope to destroy the Socialist movement of to-day by
stringing together mistaken predictions of Marx and Engels, or who think
that Socialism is losing its grip because it is adjusting its
expressions to the changed conditions which the progress of fifty years
has brought about, utterly mistake the character of the movement. In
its abandonment of the errors of Marx it is most truly Marxian--because
it is expressing life instead of repeating dogma.

Doubtless Marx anticipated a much more complete concentration of capital
and industry than has yet taken place; doubtless, too, he underrated the
powers of endurance of some petty industries, and saw the breakdown of
capitalism in a cataclysm, whereas modern Socialists see its merging
into a form of socialization. But, when all this is admitted, it cannot
be fairly said that the sum of criticism has seriously affected the
general Marxian theory, as apart from its particular exposition by Marx
himself. So far as the criticism has touched the subject of capitalist
concentration, it has been pitifully weak, and the furore it has created
seems almost pathetic. The main results of this criticism may be briefly
summarized as follows: First, in industry, the persistence, and, in some
cases, even increase, of petty industries; second, in agriculture, the
failure of large-scale farming, and the decrease of the average farm
acreage; third, in retail trade, the persistence of the small stores,
despite the growth in size and number of the great department stores;
fourth, the fact that concentration of industry does not imply a like
concentration of wealth, the number of shareholders in a great
industrial combination being frequently greater than the number of
owners in the units of industry prior to the combination. At first
sight, and stated in this manner, it would seem as if these conclusions,
if justified by the facts, involved a serious and far-reaching criticism
of the Socialist theory of a universal tendency toward the concentration
of industry and commerce into units of ever increasing magnitude.

But upon closer examination, these conclusions, their accuracy admitted,
are seen to involve no very damaging criticism of the theory. To the
superficial observer, the mere increase in the number of industrial
establishments seems a much more important matter than to the careful
student, who is not easily deceived by appearances. The student sees
that while some petty industries undoubtedly do increase in number, the
increase of large industries employing many more workers and much larger
capitals is vastly greater. Furthermore, he sees what the superficial
observer constantly overlooks, namely, that these petty industries are,
for the most part, unstable and transient, being continually absorbed by
the larger industrial combinations or crushed out of existence, as soon
as they have obtained sufficient vitality and strength to make them
worthy of notice, either as tributaries to be desired or potential
competitors to be feared. Petty industries in a very large number of
cases represent a stage in social descent, the wreckage of larger
industries whose owners are economically as dependent as the ordinary
wage-workers, or even poorer and more to be pitied. Where, on the
contrary, it is a stage in social ascent, the petty industry is,
paradoxical as the idea may appear, frequently part of the process of
industrial concentration. By independent gleaning, it endeavors to find
sufficient business to maintain its existence. If it fails in this, its
owner falls back to the proletarian level from which, in most instances,
he arose. If it succeeds only to a degree sufficient to maintain its
owner at or near the average wage-earner's level of comfort, it may pass
unnoticed and unmolested. If, on the other hand, it gleans sufficient
business to make it desirable as a tributary, or potentially dangerous
as a competitor, the petty business is pounced upon by its mightier
rival and either absorbed or crushed, according to the temper or need of
the latter. Critics of the Marxian theory have for the most part
completely failed to recognize this significant aspect of the subject,
and attached far too much importance to the continuance of petty


What is true of petty industry is true in even greater measure of retail
trade. Nothing could well be further from the truth than the hasty
generalization of some critics, that an increase in the number of retail
business establishments invalidates the theory of a progressive
concentration of capital. In the first place, many of these
establishments have no independence whatsoever, but are merely agencies
of larger enterprises. Mr. Macrosty has shown that in London the cheap
restaurants are in the hands of four or five firms, and this is a branch
of business which, because it calls for relatively small capital, shows
in a marked manner the increase of establishments. Much the same
conditions exist in connection with the trade in milk and bread.[97]
Similar conditions prevail in almost all the large cities of this
country. Single companies are known to control hundreds of saloons,
restaurants, cigar stores, shoe stores, bake shops, coal depots, and the
like. A multitude of other businesses are subject to this rule, and it
is doubtful whether, after all, there has been the real increase of
individual ownership which Mr. Ghent concedes.[98] However that may be,
it is certain that a very large number of the business establishments
which figure as statistical units in the argument against the Socialist
theory of the concentration of capital might very properly be regarded
as so many evidences in its favor.

A very large number of small businesses, moreover, are really
manipulated by speculators, and serve only as a means of divesting
prudent and thrifty artisans and others of their little savings.
Whoever has lived in the poorer quarters of a great city, where small
stores are most numerous, and has watched the changes constantly
occurring in the stores of the neighborhood, will realize the
significance of this observation. The writer has known stores on the
upper East Side of New York, where for several years he resided, change
hands as many as six or seven times in a single year. What happened was
generally this: A workingman having been thrown out of employment, or
forced to give up his work by reason of age, sickness, or accident,
decided to attempt to make a living in "business." In a few weeks, or a
few months at most, his small savings were swallowed up, and he had to
leave the store, making place for the next victim. An acquaintance of
the writer owns six tenement houses in different parts of New York City,
the ground floors of which are occupied by small stores. These stores
are rented by the month just as other portions of the buildings are, and
the owner, on going over his books for a period of five years, found
that the average duration of tenancy in them had been less than eight

During the past few years in the United States, as a result of the
development of the many inventions for the production of "moving
pictures," a new kind of cheap, popular theater has become common.
Usually the charge of admission is five cents, whence the name
"Nickelodeon"; the entertainment consists usually of a number of more or
less dramatic incidents portrayed by means of the pictures, and a few
songs, generally illustrated by pictures, and sung to the accompaniment
of a mechanical piano. In almost every town in the United States these
cheap pictorial theaters have appeared and their number will, doubtless,
considerably swell the total of business establishments. In the small
towns of the State of New York, the writer made an investigation and
found that there were frequently several such places in the same town;
that they were practically all built by the same persons, started by
them, and then leased to others. These were generally people with small
savings who, in the course of a few weeks, lost all their money and
retired, their places being taken by other victims of the speculators.
What seemed to the casual observer an admirable and conspicuous example
of an increase in petty business, proved, upon closer study, to be a
very striking example of concentration, disguised for purposes of

Thus reduced, the increase of small industries and retail establishments
affects the contention that there is a general tendency to concentration
very little. It does perhaps seriously weaken, or even destroy, some
extreme statements of the theory, contending that the process of
monopolization must be a direct, simple process of continuous absorption
and elimination, leaving each year fewer small units than before. Small
stores do exist; they have not been put out of existence by the big
department stores as was at one time confidently predicted. They serve a
real social need by supplying the minor commodities of everyday use in
small quantities, just as the petty industries serve a real social need.
Many of them are conducted by married women to supplement the earnings
of their husbands, or by widows; others by men unable to work, whose
income from them is less than the wages of artisans. Together, these
probably constitute a majority of the small retail establishments which
show any tendency to increase.[99]

The effect of this increase is still further lessened when it is
remembered that only the critics of Socialism interpret the Marxian
theory to mean that _all_ petty industry and business must disappear,
that all must be concentrated into large industrial and commercial
units, to make Socialism possible. If we are to judge Marxism as the
basis of the Socialist movement, we must judge it by the interpretation
given to it by the Socialists, and not otherwise. There is no Socialist
of note to-day who does not realize that many small industrial and
business enterprises will continue to exist for a very long time, even
continuing to exist under a Socialist régime. Kautsky, perhaps the
ablest living exponent of the Marxian theories, leader of the "Orthodox"
Marxists, admits this. He has very ably argued that the ripeness of
society for Socialism, for social production and control, depends, not
upon the number of little industries that still remain, but upon the
number of great industries which already exist.[100] The ripeness of
society for Socialism is not disproved by the number of ruins and relics
abounding. "Without a developed great industry, Socialism is
impossible," says this writer. "Where, however, a great industry exists
to a considerable degree, it is easy for a Socialist society to
_concentrate production, and to quickly rid itself of the little
industry_."[101] It is the increase of large industries, then, which
Socialists regard as the essential preliminary condition of Socialism.

Far more important than the increase or decrease of the number of units
is their relative significance in the total production, a phase of the
subject which is rather disingenuously avoided by most critics of
Marxism. Mr. Lucien Sanial, a Socialist statistician of repute, and one
of the profoundest Marxian students in America, has shown this in a
number of suggestive tables. For example, he takes twenty-seven typical
manufacturing industries for the years 1880, 1900, and 1905, and
compares the number of establishments in each year with the total amount
of capital invested and workers employed. In 1880 the number of
establishments was 63,233; in 1900 the number was 51,912, and in 1905 it
was only 44,142. From 1880 to 1905 there had been a decrease in the
number of establishments of 35.3 per cent, of which 15 per cent took
place within the last five years. But within the same period there had
been an increase in the amount of capital invested in these twenty-seven
industries as follows: from $1,276,600,000 in 1880 to $3,324,500,000 in
1900 and to $4,628,800,000 in 1905--a total increase from 1880 to 1905
of 262.6 per cent. On the other hand, the number of wage-workers
increased in the same period only 60.2 per cent, the number in 1905
being 1,731,500, as against 1,611,000 in 1900 and 1,080,200 in 1880.

In another table, forty-seven industries are taken. These forty-seven
industries comprised 29,800 establishments in 1900; five years later
there were but 26,182. In 1900 the total capital invested in these
industries was $1,005,400,000, and in 1905 it had increased to
$1,339,500,000. In the same five years the number of wage-workers
increased only from 618,000 to 749,000. Thus, in the group of larger
industries and the group of smaller ones we find the same evidences of
concentration: less establishments, larger capitals, and an increase of
wage-workers not equal to the increase in capitalization.[102]

In connection with these figures, the following table may be profitably
studied, as showing the relative insignificance of the small producer in
the total volume of manufacture. It will be seen that the two largest
classes of establishments have only 24,163 establishments, 11.2 per cent
of the total number. But they have $10,333,000,000, or 81.5 per cent of
the total manufacturing capital, and employ 71.6 per cent of all
wage-workers in manufacturing industries. It may be added that they turn
out 79.3 per cent of the total product. Of the petty industries proper,
those having a capital of less than $5000, it will be observed that they
number 32.9 per cent of the total number of establishments, but employ
only 1.3 per cent of the capital invested, and only 1.9 per cent of the
wage-workers. It is clear, therefore, that our manufacturing industry in
very highly concentrated, and that the petty industries are, despite
their number, a very insignificant factor.


                     CENT                   CENT    WAGE-WORKERS    CENT

Less than
$5,000      71,162   32.9   $165,300,000     1.3       106,300       1.9

$5,000 to
$20,000     72,806   33.7    531,100,000     4.2       419,600       7.7

$20,000 to
$100,000    48,144   22.2  1,655,800,000    13.0     1,027,700      18.8

$100,000 to
$1,000,000  22,281   10.0  5,551,700,000    43.8     2,537,550      46.4

$1,000,000   1,882    0.9  4,782,300,000    37.7     1,379,150      25.2

When we turn to agriculture, the criticisms of the Socialist theory
appear more substantial and important. A few years ago we witnessed the
rise and rapid growth of the great bonanza farms in this country. It was
shown that the advantages of large capital and the consolidation of
productive forces resulted, in farming as in manufacture, in greatly
cheapened production.[104] The end of the small farm was declared to be
imminent, and it seemed for a while that concentration in agriculture
would even outrun concentration in manufacture. This predicted
absorption of the small farms by the larger, and the average increase of
farm acreage, has not, however, been fulfilled to any great degree. An
increase in the number of small farms, and a decrease in the average
acreage, is shown in almost all the states. The increase of great
estates shown by the census figures probably bears little or no relation
to real farming, consisting mainly of great stock grazing ranches in the
West, and unproductive gentlemen's estates in the East.

Apparently, then, the Socialist theory that "the big fish eat up the
little ones, and are in turn eaten by still bigger ones," is not
applicable to agriculture. On the contrary, it seems that the great
farms cannot compete successfully with the smaller farms. It is
therefore not surprising that writers so sympathetic to Socialism as
Professor Werner Sombart and Professor Richard T. Ely should claim that
the Marxian system breaks down when it reaches the sphere of
agricultural industry, and that it seems to be applicable only to
manufacture. This position has been taken by a not inconsiderable body
of Socialists in recent years, and is one of the tenets of that critical
movement within the Socialist ranks which has come to be known as
"Revisionism." Nothing is more delusive than statistical argument of
this kind, and while these conclusions should be given due weight, they
should not be too hastily accepted. An examination of the statistical
basis of the argument is necessary.

In the first place, small agricultural holdings do not necessarily
imply economic independence, any more than do petty industries or
businesses. When we examine the census figures carefully, the first
important fact which challenges attention is that, whereas of the farms
in the United States in 1880, 71.6 per cent were operated by their
owners, in 1900 the _proportion_ had declined to 64.7 per cent. In 1900,
of the 5,739,657 farms in the United States, no less than 2,026,286 were
operated by tenants. Concerning the ownership of these rented farms
little investigation has been made, and it is likely that careful
inquiry would elicit the fact that this is a not unimportant phase of
agricultural concentration, though not revealed by the figures in the
census reports. It remains to be said concerning these figures, however,
that they do not lend support to the theory that the small farms are
being swallowed up by the larger ones, for in the same period there was
a very decided increase in the _number_ of farms operated by their
owners. Thus we have the same set of figures used to support both sides
of the controversy--one side calling attention to the decreased
_proportion_ of farms operated by their owners, the other to the
increased _number_.

A similar difficulty presents itself in connection with the subject of
mortgaged farm holdings. In 1890, the mortgaged indebtedness of the
farmers of the United States amounted to the immense sum of
$1,085,995,960, a sum almost equal to the value of the entire wheat
crop. Now, while a mortgage is certainly not suggestive of independence,
it may be either a sign of decreasing or increasing independence. It may
be a step toward the ultimate loss of one's farm or a step toward the
ultimate ownership of one. Much that has been written by Populist and
Socialist pamphleteers and editors upon this subject has been based upon
the entirely erroneous assumption that a mortgaged farm meant loss of
economic independence, whereas it often happens that it is a step toward
it. The fact is that we know very little concerning the ownership of
these mortgages, which is the crux of the question. It is known that
many of the insurance, banking, and trust companies have invested
largely in farm mortgages. This is another phase of concentration which
the critics of the theory have overlooked almost entirely. One thing
seems certain, namely, that farm ownership is not on the decline. It is
not being supplanted by tenantry; the small farms are not being absorbed
by larger ones. It seems a fair deduction from the facts, then, that the
small farmer will continue to be an important factor--indeed, the most
important factor--in American agriculture for a long time to come,
perhaps permanently. If the Socialist movement is to succeed in America,
it must recognize this fact in its propaganda.


Most of the criticism of the Marxian theory of concentration is based
upon a very unsatisfactory definition of what is meant by concentration.
The decrease of small units and their absorption or supercession by
larger units is generally understood when concentration is spoken of.
But concentration may take other, very different forms. There may be a
concentration of _control_, for example, without concentration of actual
ownership, or there may be concentration of actual ownership disguised
by mortgages, as already suggested. The sweated trades are a familiar
example of the former method of concentration. It has been shown over
and over again that while small establishments remain a necessary
condition of sweated industry, there is almost always effective
concentration of control. To all appearances an independent manufacturer
on a small scale, the sweater is generally nothing more than the agent
of some big establishment, which finds it more economical to let the
work be done in sweatshops than in its own factories. The same thing
holds good of the retail trades, many of the apparently independent
retail stores being simply agencies for big wholesale houses, controlled
by them in every way. In an even larger measure, agriculture is subject
to a control that is quite independent of actual or even nominal
ownership of the farm. Manifestly, therefore, we need a more accurate
and comprehensive definition of concentration than the one generally
accepted. Mr. A. M. Simons, in an admirable study of the agricultural
question from the Socialist viewpoint, defines concentration as "a
movement tending to give a continually diminishing minority of the
persons engaged in any industry, a constantly increasing control over
the essentials, and a continually increasing share of the total value of
the returns of the industry."[105] It is no part of the purpose of this
chapter to discuss this definition at length. It is sufficient to have
thus emphasized that concentration may be quite as effective when it is
limited to control as when it embraces ownership.

There are, then, other forms of concentration than the physical one, the
amalgamation of smaller units to form larger ones, and very often these
forms of concentration go on unperceived and unsuspected. There can be
no doubt that this is especially true of agricultural industry. Many
branches of farming, as the industry was carried on by our fathers and
their fathers before them, have been transferred from the farmhouse to
the factory. Butter and cheese making, for example, have largely passed
out of the farm kitchen into the factory. The writer recalls a visit to
a large farm in the Middle West. The sound of a churn is never heard
there, notwithstanding that it is a "dairy farm," and all the butter
and cheese consumed in that household is bought at the village store.
Doubtless this farm but presented an exaggerated form of a condition
that is becoming more and more common. The invention of labor-saving
machinery and its application to agriculture leads to a division of the
industry and the absorption by the factory of the parts most influenced
by the new processes. When we remember the tremendous rôle which complex
agencies outside of the farm play in modern agricultural industry, we
see the subject of concentration as it applies to that industry in a new
light. The grain elevators, cold-storage houses, creameries, and even
railroads, are part of the necessary equipment of production, but they
are owned and operated independently of the farm. There is a good deal
of concentration of production in agriculture which takes the form of
the absorption of some of its processes by factories instead of by other


We must also distinguish between the concentration of industry and the
concentration of wealth. While there is a natural relation between these
two phenomena, they are by no means identical. The trustification of a
given industry may bring together a score of industrial units in one
gigantic concern, so concentrating capital and production, but it is
conceivable that every one of the owners of the units which compose the
trust may have a share in it equal to the capital value of his
particular unit, but more profitable. In that case, there can obviously
be no concentration of wealth. What occurs is that all are benefited by
certain economies, in exact proportion to their holdings in the capital
stock. It may even happen that a larger number of persons participate,
as shareholders, in the amalgamation than were formerly concerned in the
ownership of the units of which the amalgamation is composed. Assuming,
for the purposes of our argument, that these persons are represented by
new capital, that the former owners of independent units share upon an
equitable basis, there will be increased diffusion of wealth instead of
its concentration. As Professor Ely says, "If the stock of the United
States Steel Corporation were owned by individuals holding one share
each, the concentration in industry would be just as great as it is now,
but there would be a wide diffusion in the ownership of the wealth of
the corporation."[106]

Obvious as this distinction may seem, it is very often lost sight of,
and when recognized it presents difficulties which are almost
insurmountable. It is well-nigh impossible to present statistically the
relation of the concentration of capital to the concentration or
diffusion of wealth, important as the point is in its bearings upon
modern Socialist theory. While the distinction does not affect the
argument that the concentration of capital and industry makes their
socialization possible, it is nevertheless an important matter. If, as
some writers, notably Bernstein,[107] the Socialist, have argued, the
concentration of capital and industry really leads to the
decentralization of wealth, and the diffusion of the advantages of
concentration among the great mass of the people, especially by creating
a new class of salaried dependents, then, instead of creating a class of
exploiters ever becoming less numerous, and a class of proletarians ever
becoming more numerous, the tendency of modern capitalism is to
distribute the gains of industry over a widening area--a process of
democratization in fact. It is very evident that if this contention is a
correct one, there must be a softening rather than an intensifying of
class antagonisms; a tendency away from class divisions, and to greater
satisfaction with present conditions, rather than increasing discontent.
If this theory can be sustained, the advocates of Socialism will be
obliged to change the nature of their propaganda from an appeal to the
economic interest of the proletariat to the general ethical sense of
mankind. There can be no successful movement based upon the interests
of one class if the tendency of modern capitalism is to democratize the
life of the world and diffuse its wealth over larger social areas than
ever before.

The exponents of this theory have based their arguments upon statistical
data chiefly relating to: (1) The number of taxable incomes in countries
where incomes are taxed; (2) the number of investors in industrial and
commercial countries; (3) the number of savings bank deposits. As often
happens when reliance is placed upon the direct statistical method, the
result of all the discussion and controversy upon this subject is
extremely disappointing and confusing. The same figures are used to
support both sides of the argument with equal plausibility. The
difficulty lies in the fact that the available statistics do not include
all the facts essential to a scientific and conclusive result.

It is not intended here to add to the Babel of voices in this
discussion, but to present the conclusions of two or three of the most
careful investigators in this field. Professor Ely[108] quotes a table
of incomes in the Grand Duchy of Baden, based upon the income tax
returns of that country, which has formed the theme of much dispute. The
table shows that in the two years, 1886 and 1896, less than one per cent
of the incomes assessed were over 10,000 marks a year, and from this
fact it has been argued that wealth in that country has not been
concentrated to any very great extent. In like manner, the French
economist, Leroy-Beaulieu, has argued that the fact that in 1896 only
2750 persons in Paris had incomes of over 100,000 francs a year betokens
a wide diffusion of wealth and an absence of concentration.[109] But the
important point of the discussion, the _proportion of the total wealth
owned by these classes_, is entirely lost sight of by those who argue in
this manner. Further, it must always be borne in mind that there is a
decided tendency in all income tax schedules to understate the amount of
incomes above a certain size, the larger the income the more likelihood
of its being understated in the returns. The psychology of this fact
needs no elaborate demonstration. Taking the figures for the Grand Duchy
of Baden as they are given, we have no particulars at all concerning the
number of incomes under 500 marks, but of the persons assessed upon
incomes of 500 marks and over, in 1886, the poorest two thirds had about
one third of the total income, and the richest 0.69 per cent had 12.78
per cent of the total income. So far, the figures show a much greater
concentration of wealth than appears from the simple fact that less than
one per cent of the incomes assessed were over 10,000 marks a year.

Going further, we compare the two years, 1886 and 1896, and find that
this concentration increased during the ten-year period as follows: In
1886, there were 2212 incomes of more than 10,000 marks assessed, being
0.69 per cent of the total number. In 1896, there were 3099 incomes of
more than 10,000 marks assessed, being 0.78 per cent of the total
number. In 1886, 0.69 per cent of the incomes assessed amounted to
51,403,000 marks, representing 12.77 per cent of the total assessed
wealth; while in 1896, 0.78 per cent of the incomes assessed amounted to
81,986,000 marks, representing 15.02 per cent of the total wealth so
assessed. In 1886 there were 18 incomes of over 200,000 marks a year,
aggregating 6,864,000 marks, 1.70 per cent of the total value of all
incomes assessed; in 1896, there were 28 such incomes, aggregating
12,481,000 marks, or 2.29 per cent of the total value of all incomes
assessed. The increase of concentration shown by these figures is not
disputable, it seems to the present writer, when they are thus carefully
analyzed, notwithstanding the fact that the table from which they are
drawn is sometimes used to support the opposite contention.

According to the late Professor Richmond Mayo-Smith,[110] seventy per
cent of the population of Prussia have incomes below the income tax
standard, their total income representing only one third of the total
income of the population. An additional one fourth of the population
enjoys one third of the total income, while the remaining one third goes
to about four per cent of the people. The significance of these figures
is clearly shown by the following diagram:--




In Saxony the statistics show that "two thirds of the population possess
less than one third of the income, and that 3.5 per cent of the upper
incomes receive more than 66 per cent at the lower end." From a table
prepared by Sir Robert Giffen, a notoriously optimistic statistician,
always the exponent of an ultra-roseate view of social conditions,
Professor Mayo-Smith concludes that in England, "about ten per cent of
the people receive nearly one half of the total income."[111] These
figures are rather out of date, it is true, but they err in understating
the amount of concentration rather than otherwise, as the researches of
Mr. Chiozza Money, M.P., and others show.[112]

In this country, the absence of income tax figures makes it impossible
to get direct statistical evidence as to the distribution of incomes.
The most careful estimate of the distribution of wealth in the United
States yet made is that by the late Dr. Charles B. Spahr.[113] Written
in 1895, Dr. Spahr's book cannot be regarded as an accurate presentation
of conditions as they exist at the present moment, yet here again there
is every reason to believe that the process of concentration has gone on
unchecked since he wrote. It is not necessary for our present purpose,
however, to accept the estimate of Dr. Spahr as authoritative and
conclusive. The figures are quoted here simply as the result reached by
the most patient, conscientious, and scientific examination of the
distribution of wealth in this country yet made. Dr. Spahr's conclusion
was that in 1895 less than one half of the families in the United States
were property-less; but that, nevertheless, seven eighths of the
families owned only one eighth of the national wealth, while one per
cent of the families owned more than the remaining ninety-nine per cent.

Mr. Lucien Sanial, in a most careful analysis of the census for 1900,
shows that, classified according to occupations, 250,251 persons
possessed $67,000,000,000, out of a total of $95,000,000,000 given as
the national wealth; that is to say, 0.9 per cent of the total number in
all occupations owned 70.5 per cent of the total national wealth. The
middle class, consisting of 8,429,845 persons, being 29.0 per cent of
the total number in all occupations, owned $24,000,000,000, or 25.3 per
cent of the total national wealth. The lowest class, the proletariat,
consisting of 20,393,137 persons, being 70.1 per cent of the total
number in all occupations, owned but $4,000,000,000, or 4.2 per cent of
the total wealth. To recapitulate: Of the 29,073,233 persons ten years
old and over engaged in occupations,

      0.9 per cent own    70.5 per cent of total wealth.
     29.0 per cent own    25.3 per cent of total wealth.
     70.1 per cent own     4.2 per cent of total wealth.

Startling as these figures are, it will be evident upon reflection that
they do not adequately represent the amount of wealth concentration. The
occupational basis is not quite satisfactory as applied to the richest
class. It serves for the proletarian class, of course, and for a very
large part of the middle class. In these classes, as a rule, the
_occupied_ persons represent wealth ownership. But this is by no means
true of the richest class. In this class we have a very considerable
proportion of the wealth owned by _unoccupied_ persons, such as the
wives rich in their own right, children and other unoccupied members of
families rich by inheritance. Mr. Henry Laurens Call, in a paper read
before the American Association for the Advancement of Science, at
Columbia University, at the end of 1906, made these figures the basis of
the startling estimate that one per cent of our population own not less
than ninety per cent of our total wealth.

There is a peculiarity of modern capitalism which enables the great
capitalists to control vastly more wealth than they own. Take any group
of large capitalists, and it will be found that they _control_ a much
greater volume of capital than they _own_. The invested capital of a
multitude of small investors is in their keeping, and they can and do
use it for purposes of their own. Thus we have a concentration of
capitalist control which goes far beyond the concentration of ownership.
And this concentration of the essential control of the capital of a
country becomes more and more important each year. It is recognized
to-day that the most important capitalist is not he who himself owns the
greatest amount of capital, but he who controls the greatest amount,
quite irrespective of its ownership.

The growth of immense private fortunes is an indisputable evidence of
the concentration of wealth. In 1854 there were not more than
twenty-five millionaires in New York City, their total fortunes
aggregating $43,000,000. There were not more than fifty millionaires in
the whole of the United States, their aggregate fortunes not exceeding
$80,000,000. To-day there are several individual fortunes of more than
$80,000,000 each. New York City alone is said to have over two thousand
millionaires, and the United States more than five thousand. By a
curious mental process, the _New York World_, when the first edition of
this little book appeared, sought to prove in a labored editorial that
the increase of millionaires tended to prove an increasing diffusion of
wealth rather than the contrary. It is hardly worth while, perhaps,
making any reply to such puerility. Every student knows that the
multimillionaire is only possible as a result of the concentration of
wealth, that such fortunes are realized by the absorption of numerous
smaller ones. Further, it is only necessary to add that all the
millionaires of 1854, together with the half millionaires, owned not
more than about $100,000,000 out of the total wealth, which was at that
time something like $10,000,000,000. In other words, they owned not more
than one per cent of the wealth of the country. In 1890, when the wealth
of the country was slightly more than $65,000,000,000, Senator Ingalls
could quote in the United States Senate a table showing that the
millionaires and half millionaires of that time, 31,100 persons in all,
owned $36,250,000,000, or just fifty-six per cent of the entire wealth
of the United States.[114] Professor Ely accepts the logic of the
statistical data gathered in Europe and the United States, and says
"such statistics as we have ... all indicate a marked concentration of
wealth, both in this country and Europe."[115]


Summing up, we may state the argument of this chapter very briefly as
follows: The Socialist theory is that competition is self-destructive,
and that the inevitable result of the competitive process is to produce
monopoly, either through the crushing out of the weak by the strong, or
the combination of units as a result of a conscious recognition of the
wastes of competition and the advantages of coöperation. The law of
capitalist development, therefore, is from competition and division to
combination and concentration. As this concentration proceeds, a large
class of proletarians is formed on the one hand, and a small class of
capitalist lords on the other, an essential antagonism of interests
existing between the two classes. Petty industries may continue to
exist, though, upon the whole, the tendency is toward their extinction.
In certain industries, their number may even increase, but their
relative importance is constantly decreasing. While Socialism does not
preclude the continued existence of small private industry or business,
it does require and depend upon the development of a large body of
concentrated industry, monopolies which can be transformed into social
monopolies whenever the people may decide so to transform them. These
conditions are being fulfilled in the evolution of our economic system.

The interindustrial and international trustification of industry shows a
remarkable fulfillment of the law of capitalist concentration which the
Socialists were the first to formulate; the existence of petty
industries and businesses, or their numerical increase even, being a
relatively insignificant matter compared with the enormous increase in
large industries and businesses, and their share in the total volume of
industry and commerce. In agriculture, concentration, while it does not
proceed so rapidly or directly as in manufacture and commerce, and while
it takes directions and forms unforeseen by the Socialists of a
generation ago, proceeds surely nevertheless. Along with this
concentration of capital and industry proceeds the concentration of
wealth into proportionately fewer hands. While a certain diffusion of
wealth takes place through the mechanism of capitalist concentration, by
developing a new class of highly salaried officials, and enabling
numerous small investors to own shares in great industrial and
commercial corporations, it is not sufficient to balance the
expropriation which goes on in the competitive struggle, and it is true
that a larger proportion of the national wealth is owned by a minority
of the population than ever before, that minority being proportionately
less numerous than ever before. Further, the peculiar financial
organization of modern capitalist society enables the ruling capitalists
to control and use to their own advantage the wealth of others invested
in industrial and commercial corporations. Thus to the concentration of
ownership must be added the concentration of control, which plays an
increasingly important part in capitalist economics.

Whatever defects there may be in the Marxian theory, as outlined by Marx
himself, and whatever modifications of his statement of it may be
rendered necessary by changed conditions, in its main and essential
features it has successfully withstood all the criticisms which have
been directed against it. Economic literature is full of prophecies, but
in its whole range there is not an instance of prophecy more literally
and abundantly fulfilled than that which Marx made concerning the trend
of capitalist development. And Karl Marx was not a prophet--he but read
clearly the meaning of certain facts which others had not learned to
read, the law of social dynamics. That is not prophecy, but science.


[94] _Studies in the Evolution of Industrial Society_, by R. T. Ely,
page 95.

[95] _Capital_, Vol. I (Kerr edition), page 837.

[96] _Briefe und Auszüge aus Briefen von Joh. Phil. Becker, Jos.
Dietzgen, Friederich Engels, Karl Marx u. A. an F. A. Sorge und Andere_,
Stuttgart, 1906.

[97] H. W. Macrosty, _The Growth of Monopoly in English Industry_
(Fabian Tract).

[98] _Our Benevolent Feudalism_, by W. J. Ghent, pages 17-21.

[99] A factor of tremendous importance in the maintenance of petty
industries and business establishments in this country, which Marx could
not have anticipated, has been the unprecedented volume of foreign
immigration. Not only have some menial personal services--such as shoe
cleaning, for example--been transformed into regular businesses by
immigrants from certain countries, but the massing together of
immigrants, aliens in language, customs, tastes, and manners, provides a
very favorable soil for the development of small business enterprises.

[100] _The Social Revolution_, by Karl Kautsky, Part I, page 144. See
also the argument by Paul Lafargue, Marx's son-in-law, that Socialism
will not oppose petty agriculture by private individuals working their
own farms.--_Revue Politique et Parliamentaire_, October, 1898, page 70.

[101] Kautsky, _The Social Revolution_, page 144.

[102] The figures are quoted from _Socialism Inevitable_, by Gaylord
Wilshire, pages 325-326.

[103] The table is quoted from _Socialism Inevitable_, by Gaylord
Wilshire, page 326.

[104] The cost of raising wheat in California, where large farming has
been most scientifically developed, is said to vary from 92.5 cents per
100 pounds on farms of 1000 acres to 40 cents on farms of 50,000 acres.

[105] _The American Farmer_, by A. M. Simons, page 97.

[106] _Studies in the Evolution of Industrial Society_, by Richard T.
Ely, page 255.

[107] _Die Voraussetzungen des Sozialismus_, by Edward Bernstein, page

[108] _Studies in the Evolution of Industrial Society_, by Richard T.
Ely, pages 261-262.

[109] _Essai sur la repartition des richesses et sur la tendance à une
moindre inégalité des conditions_, par Leroy-Beaulieu, page 564.

[110] _Statistics and Economics_, by Richmond Mayo-Smith, Book III,

[111] _Statistics and Economics_, by Richmond Mayo-Smith, Book III,

[112] Cf. _Riches and Poverty_, by Chiozza Money, M.P.; also, _Fabian
Tract_, No. 5.

[113] _The Present Distribution of Wealth in the United States_, by
Charles B. Spahr (1896).

[114] _Writings and Speeches of John J. Ingalls_, page 320.

[115] _Studies in the Evolution of Industrial Society_, page 265.




No part of the theory of modern Socialism has called forth so much
criticism and opposition as the doctrine of the class struggle. Many who
are otherwise sympathetic to Socialism denounce this doctrine as narrow,
brutal, and productive of antisocialistic feelings of class hatred. Upon
all hands the doctrine is condemned as an un-American appeal to passion
and a wicked exaggeration of social conditions. When President Roosevelt
attacks the preachers of the doctrine, and wrathfully condemns
class-consciousness as "a foul thing," he doubtless expresses the views
of a majority of American citizens. The insistence of Socialists upon
this aspect of their propaganda is undoubtedly responsible for keeping a
great many outside of their movement who otherwise would be identified
with it. If the Socialists would repudiate the doctrine that Socialism
is a class movement, and make their appeal to the intelligence and
conscience of all classes, instead of to the interests of a special
class, they could probably double their numerical strength at once. To
many, therefore, it seems a fatuous and quixotic policy to preach such a
doctrine, and it is very often charitably ascribed to the peculiar
intellectual and moral myopia of fanaticism.

Before accepting this conclusion, and before indorsing the Rooseveltian
verdict, the reader is bound as a matter of common fairness, and of
intellectual integrity, to consider the Socialist side of the argument.
There is no greater fanaticism than that which condemns what it does not
take the trouble to understand. The Socialists claim that the doctrine
is misrepresented; that it does not produce class hatred; and that it is
a vital and pivotal point of Socialist philosophy. The class struggle,
says the Socialist, is a law of social development. We only recognize
the law, and are no more responsible for its existence than for the law
of gravitation. The name of Marx is associated with the law in just the
same manner as the name of Newton is associated with the law of
gravitation, but Marx is no more responsible for the social law he
discovered than was Newton for the physical law he discovered. There
were class struggles thousands of years before there was a Socialist
movement, thousands of years before Marx was born, and it is therefore
absurd to charge us with the creation of the class struggle, or class
hatred. We realize perfectly well that if we ignored this law in our
propaganda, making our appeal to a universal sense of abstract justice
and truth, many who now hold aloof from us would join our movement. But
we should not gain strength as a result of their accession to our ranks.
We should be obliged to emasculate Socialism, to dilute it, in order to
win a support of questionable value. History teems with examples of the
disaster which inevitably attends such a course. We should be quixotic
and fatuous indeed if we attempted anything of the kind. Such, briefly
stated, are the main outlines of the reply which the average Socialist
gives to the criticism of the class struggle doctrine described.

The class struggle theory is part of the economic interpretation of
history. Since the dissolution of primitive tribal society, the modes of
economic production and exchange have inevitably grouped men into
economic classes. The theory is thus admirably stated by Engels in the
Introduction to the _Communist Manifesto_:--

"In every historical epoch, the prevailing mode of economic production
and exchange, and the social organization necessarily following from it,
form the basis upon which is built up, and from which alone can be
explained, the political and intellectual history of that epoch; and,
consequently, the whole history of mankind (since the dissolution of
primitive society, holding land in common ownership) has been a history
of class struggles, contests between exploiting and exploited, ruling
and oppressed classes; that the history of these class struggles forms a
series of evolution in which, nowadays, a stage has been reached where
the exploited and oppressed class--the proletariat--cannot attain its
emancipation from the sway of the exploiting and ruling class--the
bourgeoise--without, at the same time, and once and for all,
emancipating society at large from all exploitation, oppression, class
distinctions, and class struggles."[116]

In this classic statement of the theory, there are several fundamental
propositions. First, that class divisions and class struggles arise out
of the economic life of society. Second, that since the dissolution of
primitive tribal society, which was communistic in character, mankind
has been divided into economic groups or classes, and all its history
has been a history of struggles between these classes, ruling and ruled,
exploiting and exploited, being forever at war with each other. Third,
that the different epochs in human history, stages in the evolution of
society, have been characterized by the interests of the ruling class.
Fourth, that a stage has now been reached in the evolution of society
where the struggle assumes a form which makes it impossible for class
distinctions and class struggles to continue if the exploited and
oppressed class, the proletariat, succeeds in emancipating itself. In
other words, the cycle of class struggles which began with the
dissolution of rude, tribal communism, and the rise of private property,
ends with the passing of private property in the means of social
existence and the rise of Socialism. The proletariat in emancipating
itself destroys all the conditions of class rule.


As we have already seen, slavery is historically the first system of
class division which presents itself. Some ingenious writers have
endeavored to trace the origin of slavery to the institution of the
family, the children being the first slaves. It is fairly certain,
however, that slavery originated in conquest. When a tribe was conquered
and enslaved by some more powerful tribe, all the members of the
vanquished tribe sunk to one common level of servility and degradation.
Their exploitation as laborers was the principal object of their
enslavement, and their labor admitted of little gradation. It is easy to
see the fundamental class antagonisms which characterized slavery. Has
there been no uprisings of the slaves, no active and conscious struggle
against their masters, the antagonism of interests between them and
their masters would be none the less apparent. But the overthrow of
slavery was not the result of the rebellions and struggles of the
slaves. While these undoubtedly helped, the principal factors in the
overthrow of chattel slavery as the economic foundation of society were
the disintegration of the system to the point of bankruptcy, and the
rise of a new, and sometimes, as in the case of Rome, alien ruling

The class divisions of feudal society are not less obvious than those of
chattel slavery. The main division, the widest gulf, divided the feudal
lord and the serf. Often as brutally ill-treated as their
slave-forefathers had been, the feudal serfs from time to time made
abortive struggles. The class distinctions of feudalism were constant,
but the struggles between the lords and the serfs were sporadic, and of
comparatively little moment, just as the risings of their slave
forefathers had been. But alongside of the feudal estate there existed
another class, the free handicraftsmen and peasants, the former
organized into powerful guilds. It was this class, and not the serf
class, which was destined to challenge the rule of the feudal nobility,
and wage war upon it. As the feudal class was a landed class, so the
class represented by the guilds became a moneyed and commercial class,
the pioneers of our modern capitalist class. As Mr. Brooks Adams[117]
has shown very clearly, it was this moneyed, commercial class, which
gave to the king the instrument for weakening and finally overthrowing
feudalism. It was this class which built up the cities and towns from
which was drawn the revenue for the maintenance of a standing army, thus
liberating the king from his dependence upon the feudal lords. The
capitalist class triumphed over the feudal nobility, and its interests
became in their turn the dominant interests in society. Capitalism in
its development effectually destroyed all those institutions of
feudalism which obstructed its progress, leaving only those which were
innocuous and safely to be ignored.

In capitalist society, the main class division is that which separates
the employing, wage-paying class from the employed, wage-receiving
class. Notwithstanding all the elaborate arguments made to prove the
contrary, the frequently heard myth that the interests of Capital and
Labor are identical, and the existence of pacificatory associations
based upon that myth, there is no fact in the whole range of social
phenomena more self-evident than the existence of an inherent,
fundamental antagonism in the relationship of employer and employee. As
individuals, in all other relations, they may have a commonality of
interests, but as employer and employee they are fundamentally and
necessarily opposed. They may belong to the same church, and so have
religious interests in common; they may have common racial interests,
as, for instance, if negroes, in protecting themselves against the
attacks made in a book like _The Clansman_, or, if Jews, in opposing
anti-Semitic movements; as citizens they may have the same civic
interests, be equally opposed to graft in the city government, or
equally interested in the adoption of wise sanitary precautions against
epidemics. They may even have a common industrial interest in the
general sense that they may be equally interested in the development of
the industry in which they are engaged, and fear, equally, the results
of a depression in trade. But their special interests as employer and
employee are antithetical.

It cannot be denied that, in certain circumstances, these other
interests may become so accentuated that the class antagonisms are
momentarily lost sight of, or completely dwarfed in importance; nor is
such a denial implied in the Socialist theory. It is not difficult to
see that in the case of a general uprising against the members of their
race, in which their lives are imperiled, Jewish employers and employees
may forget their _class_ interests and remember only that they are Jews.
So with negroes and other oppressed races. The economic interests of the
class may be engulfed in the solidarity of the race. It is not
difficult, either, to see that in the presence of some great common
danger or calamity, class interests may likewise be completely
subordinated. An admirable example of this occurred at the time of the
San Francisco earthquake and fire. The enormous demand for labor
occasioned by that disaster practically enabled the artisans, most of
whom were organized into unions, to demand and obtain almost fabulous
wages. But there was no thought of taking advantage of the calamity. On
the contrary, the unions immediately announced that they would make no
attempt to do so. Not only that, but they voluntarily waived rules which
in normal times they would have insisted upon with all their powers. The
temporary overshadowing of the economic interests of classes by other
special interests which have been thrust into special prominence, is
not, however, evidence that these class interests do not prevail in
normal times. Recognition of this fact effectually destroys much
criticism of the theory.

The interest of the wage-worker, as wage-worker, is to receive the
largest wage possible for the least number of hours spent in labor. The
interest of the employer, as employer, on the other hand, is to secure
from the worker as many hours of service, as much labor power, as
possible for the lowest wage which the worker can be induced to accept.
The workers employed in a factory may be divided by a hundred different
forces. They may be divided by racial differences, for instance; but
while preserving these differences in a large measure, they will tend to
unite upon the basis of their economic interests. Some of the great
labor unions, notably the United Mine Workers,[118] afford remarkable
illustrations of this fact. If the difference of religious interests
leads to division, the same unanimity of economic interests will sooner
or later be developed. No impartial investigator who studies the
influence of a great labor union which includes in its membership
workers of various nationalities and adherents of various religious
creeds, can fail to observe the fact that the community of economic
interests which unites them is a powerful factor making for their
amalgamation into a harmonious civic whole.

With the employers it is the same. They, too, may be divided by a
hundred forces; the competition among them may be keen and fierce, but
common economic interests will tend to unite them against the
organizations of the workers they employ. Racial, religious, social, and
other divisions and distinctions, may be maintained, but they will, in
general, unite for the protection and furtherance of their common
economic interests.

So much, indeed, belongs to the very primer stage of economic theory.
Adam Smith is rather out of fashion nowadays, but there is still much in
"The Wealth of Nations" which will repay our attention. No Socialist
writer, not even Marx, has stated the fundamental principle of the
antagonism between the employing and employed classes more clearly, as
witness the following:--

"The workmen desire to get as much, the masters to give as little as
possible. The former are disposed to combine in order to raise, the
latter in order to lower the wages of labor.... Masters are always and
everywhere in a sort of tacit, but constant and uniform, combination,
not to raise the wages of labor above their actual rate. To violate this
combination is everywhere a most unpopular action, and a sort of
reproach to a master among his neighbors and equals.... Masters too
sometimes enter into particular combinations to sink the wages of
labor.... These are always conducted with the utmost silence and
secrecy, till the moment of execution.... Such combinations, however,
are frequently resisted by a contrary defensive combination of the
workmen; who sometimes, too, without any provocation of this kind,
combine of their own accord to raise the price of labor. Their usual
pretenses are, sometimes the high price of provisions; sometimes the
great profits which the masters make by their work. But whether these
combinations be offensive or defensive, they are always abundantly heard
of. In order to bring the point to a speedy decision, they have always
recourse to the loudest clamor, and sometimes to the most shocking
violence and outrage. They are desperate, and act with the extravagance
and folly of desperate men, who must either starve, or frighten their
masters into an immediate compliance with their demands. The masters
upon these occasions are just as clamorous upon the other side, and
_never cease to call aloud for the assistance of the civil magistrate,
and the rigorous execution of those laws which have been enacted with so
much severity against the combinations of servants, laborers, and

Thus Adam Smith. Were it essential to our present purpose, it would be
easy to quote from all the great economists in support of the Socialist
claim that the interests of the capitalist and those of the laborer are
irreconcilably opposed. That individual workers and employers will be
found who do not recognize their class interests is true, but that fact
by no means invalidates the contention that, in general, men will
recognize and unite upon a basis of common class interests. In both
classes are to be found individuals who attach greater importance to the
preservation of racial, religious, or social, than to economic,
interests. But because the economic interest is fundamental, involving
the very basis of life, the question of food, clothing, shelter, and
comfort, these individuals are and must be exceptions to the general
rule. Workers sink their racial and religious differences and unite to
secure better wages, a reduction of their hours of labor, and better
conditions in general. Employers, similarly, unite to oppose whatever
may threaten their class interests, without regard to other
relationships. The Gentile who is himself an anti-Semite has no qualms
of conscience about employing Jewish workmen, at low wages, to compete
with Gentile workers; he does not object to joining with Jewish
employers in an Employers' Association, if thereby his economic
interests may be safeguarded. And the Jewish employer, likewise, has no
objection to joining with the Gentile employer for mutual protection, or
to the employment of Gentile workers to fill the places of his
employees, members of his own race, who have gone out on strike for
higher wages.


The class struggle, therefore, presents itself in the present stage of
social development, in capitalist countries, as a conflict between the
wage-paying and the wage-paid classes. That is the dominating and
all-absorbing conflict of the industrial age in which we live. True,
there are other class interests more or less involved. This is
especially true in the United States with its enormous agricultural
industry, to which the description of the industrial conflict cannot be
applied. There are the indefinite, inchoate, vague, and uncertain
interests of that large, so-called middle class, composed of farmers,
retailers, professional workers, and so on. The interests of this large
class are not, and cannot be, as definitely defined. They vacillate,
conforming now to the interest of the wage-workers, now to the interest
of the employers. Thus the farmer may oppose an increase in the wages of
farm laborers, because that touches him directly as an employer. His
relation to the farm laborer is substantially that of the capitalist to
the city worker, and his attitude upon that question is the attitude of
the capitalist class as a whole. At the same time, he may heartily favor
an increase of wages for miners, carpenters, bricklayers, shoemakers,
printers, painters, factory workers, and non-agricultural laborers in
general, for the reason that while a general rise of wages, resulting in
a general rise of prices, will affect him slightly as a consumer, and
compel him to pay more for what he buys, it will benefit him much more
as a seller of the products of his farm. In short, consciously very
often, but unconsciously oftener still, personal or class interests
control our thoughts, opinions, beliefs, and actions.

It is impossible with the data at our disposal at present to make such
an analysis of our population as will enable us to determine the
particular class interests of the various groups. Of the twenty-four
million men and boys engaged in industry there are some six million
farmers and tenants; three million seven hundred and fifty thousand farm
laborers; eleven million mechanics, laborers, clerks, and servants; one
million five hundred thousand professional workers, agents, and the
like; and about two million employers, large and small. Accurately to
place each of these groups is out of the question until such time as we
have a much more detailed study of our economic life than has yet been
attempted. We may, however, roughly relate some of the groups.

First: It is evident that the interests of the eleven million
wage-earners are, as a whole, opposed to those of the employing class.
There may be exceptions, as in the case of those whose very occupation
as confidential agents of the capitalists, overseers, and the like,
places them outside of the sphere of working-class interests. They may
not receive a salary much above the wage of the mechanic, yet their
function is such as to place them psychologically with the capitalists
rather than with the workers. It is also evident that, while their
_interests_ may be demonstrably antagonistic to those of the employers,
not all of the wage-earners will be _conscious_ of that fact. The
_consciousness_ of class interests develops slowly among rural and
isolated workers, especially as between the small employer and his
employee. And even when there is the consciousness of antagonistic
interests among these workers it is very difficult for them actively to
express it. Hence they cannot play an important part in the actual
conflict of classes.

Second: We may safely place the three million seven hundred and fifty
thousand farm laborers, as regards their economic _interests_, with the
general mass of wage-workers, with one important qualification. So far
as they are in the actual relation of wage-paid laborers, hired by the
month, week, or day, and bearing no other relation to their employers,
they belong, in their economic interests, to the proletariat. But there
are many farm laborers included in our enumeration who do not hold that
relation to their employers. They are the sons of the farmers
themselves, expecting to assume their fathers' positions, and their
position as wage-paid laborers is largely nominal and fictitious. How
many such there are it is impossible to ascertain with anything like
certainty, and we can only say, therefore, that the position of the
class, as such, must be determined without including these. But while
this class has economic interests similar to those of the industrial
proletariat, because of their isolation and scattered position, and
because of the personal relations which they bear to their
employers--farmer and laborer often working side by side, equally hard,
and not infrequently having approximately the same standards of
living--these cannot, to any very great extent, become an active factor
in the class conflict in the same sense as the industrial wage-workers
can, by engaging in strikes, boycotts, and other manifestations of the
class war. Still, they may, and in fact do, play an important rôle in
the _political_ aspects of the struggle. Let a political movement of the
proletariat arise and it will be found that these agricultural laborers
will join it not less enthusiastically than their fellows from the
factories in the cities. It would probably surprise most thoughtful
Americans if they could see the organization maps in the offices of the
Socialist Party of the United States, dotted with little red-capped pins
denoting local organizations of the party. These are quite as common in
the agricultural states as in the industrial states. So, too, in
Germany. The movement is politically nearly as strong in the agrarian
districts as elsewhere. This is a fact of vital significance, one which
must not be lost sight of in studying the progress of Socialism in

Third: Of the exact position of the remaining groups it is very
difficult to speak with anything like assurance. In an earlier chapter
we have noticed the persistence of the small farm in America, and the
fact that a class of small farmers forms a very important part of our
population. As already observed, the economic condition of the small
farmer is very often little, if any, superior to that of the laborers he
employs. Elsewhere, I have shown that the actual income of the small
farmer is not infrequently less than that of the hired laborer.[120]
This is just as true of the small dealer, and the small manufacturer.
But mere poverty of income, companionship in misery, the sharing of an
equally poor existence, does not suffice to place the farmer in the
proletarian class, as many Socialist writers have shown.[121] The small
farmers constitute a distinct class. They are not, as the small dealers
and manufacturers are, mere remnants of a disappearing class. The class
is a permanent one, apparently, as much so as the class of industrial
wage-workers. As a class it is just as essential to agricultural
production as the industrial proletariat is essential to manufacture. It
is thus a class analogous to the industrial proletariat, and Kautsky has
well said that the small farmer is the "proletariat of the country." The
exploitation of the small farmer is not direct, like that of the
wage-worker by his employer, but indirect, through the great capitalist
trusts and railroads. It also happens that these derive their chief
income from the direct exploitation of the wage-workers, so that the
small farmer and the wage-worker in the city factory have common
exploiters. As they become conscious of this, the two classes will tend
to unite their forces in the one sphere where such unity of action is
possible, the sphere of political action.

This is also true, in some degree at least, of a considerable fraction
of the one million five hundred thousand workers included in the
professional and agent classes, and of the two million employers, the
small dealers and manufacturers being included in this enumeration. That
there is such a considerable fraction of each of these two classes whose
interests lead them to make common cause with the proletariat is not at
all a matter of theory or speculation, but of experience. These classes
are represented very largely in the membership of the Socialist parties
of this country and of Europe.


Although it is sometimes so interpreted, the theory that classes are
based upon commonality of interests does not imply that men are never
actuated by other than selfish motives; that a sordid materialism is the
only motive force at work in the world. Marx and Engels carefully
avoided the use of the word _interests_ in such manner as to suggest
that material interests control the course of history. They invariably
used the term _economic conditions_, and the careful reader will not
fail to perceive that although economic conditions produce interests
which form the basis of class divisions, it is not unusual for men to
act contrary to their personal _interests_ as a result of existing
_conditions_. In general, class interests and personal interests
coincide, but there are certainly occasions when they conflict. Many an
employer, having no quarrel with his employees and confident that he
will be the loser thereby, joins in a fight upon labor unions because he
is conscious that the interests of his class are involved. In a similar
way, workingmen enter upon sympathetic strikes, consciously, at an
immediate loss to themselves, because they place class loyalty before
personal gain. It is significant of class feeling and temper that when
employers act in this manner, and lock out employees with whom they have
no trouble, simply to help other employers to win their battles, they
are lauded by the very newspapers which denounce the workers when they
adopt a like policy.

It is also true that there are individuals in both classes who never
become conscious of their class interests, and steadfastly refuse to
join with the members of their class. The workingman who refuses to join
a union, or who "scabs" when his fellow-workers go out on strike, may
act from ignorance or from sheer self-interest and greed. His action may
be due to his placing personal interest before the larger interest of
his class, or from being too shortsighted to see that ultimately his own
interests and those of his class must merge. Many an employer, likewise,
may refuse to join in any concerted action of his class for either of
these reasons, or he may even rise superior to his class and personal
interests and support the workers because he believes in the justness of
their cause, realizing perfectly well that their gain means loss to him
or to his class. This ought to be a sufficient answer to those shallow
critics who think that they dispose of the class struggle theory of
modern Socialism by enumerating those of its leading exponents who do
not belong to the proletariat.

The influence of class environment upon men's beliefs and ideals is a
subject which our most voluminous ethicists have scarcely touched upon
as yet. It is a commonplace saying that each age has its own standards
of right and wrong, but little effort has been made, if we except the
Socialists, to trace this fact to its source, to the economic conditions
prevailing in the different ages.[122] Still less effort has been made
to account for the different standards held by the different social
classes at the same time, and by which each class judges the others. In
our own day the idea of slavery is generally held in abhorrence. There
was a time, however, when it was almost universally looked upon as a
divine institution, alike by slaveholder and slave. It is simply
impossible to account for this complete revolution of feeling upon any
other hypothesis than that slave-labor then seemed absolutely essential
to the life of the world. The slave lords of antiquity, and, more
recently, the Southern slaveholders in our own country, all believed
that slavery was eternally right. When the slaves took an opposite view
and rebelled, they were believed to be in rebellion against God and
nature. The Church represented the same view just as vigorously as it
now opposes it. The slave owners who held slavery to be a divine
institution, and the priests and ministers who supported them, were just
as honest and sincere in their belief as we are in holding antagonistic
beliefs to-day.

What was accounted a virtue in the slave was accounted a vice in the
slaveholder. Cowardice and a cringing humility were not regarded as
faults in a slave. On the contrary, they were the stock virtues of the
pattern slave and added to the estimation in which he was held, just as
similar traits are valued in personal servants--butlers, waiters,
valets, footmen, and other flunkies--in our own day. But similar traits
in the slaveholder, or the "gentleman" of to-day, would be regarded as
terrible faults. As Mr. Algernon Lee very tersely puts it, "The slave
was not a slave because of his slavish ideals and beliefs; the slave was
slavish in his ideals and beliefs because he lived the life of a

In the industrial world of to-day we find a similar divergence of
ethical standards. What the laborers regard as wrong, the employers
regard as absolutely and immutably right. The actions of the workers in
forming unions and compelling unwilling members of their own class to
join them, even resorting to the bitter expedient of striking against
them with a view to starving them into submission, seem terribly unjust
to the employers and the class to which the employers belong. To the
workers themselves, on the other hand, such actions have all the
sanctions of conscience. Similarly, many actions of the employers, in
which they themselves see no wrong, seem almost incomprehensibly wicked
to the workers.

Leaving aside the wholesale fraud of our ordinary commercial
advertisements, the shameful adulteration of goods, and a multitude of
other such nefarious practices, it is at once interesting and
instructive to compare the employers' denunciations of "the outrageous
infringement of personal liberty," when the "oppressor" is a labor
union, with some of their everyday practices. The same employers who
loudly, and, let it be said, quite sincerely, condemn the members of a
union who endeavor to bring about the discharge of a fellow-worker
because he declines to join their organization, have no scruples of
conscience about discharging a worker simply because he belongs to a
union, and so effectually "blacklisting" him that it becomes almost or
quite impossible for him to obtain employment at his trade elsewhere.
They do not hesitate to do this secretly, conspiring against the very
life of the worker. While loudly declaiming against the "conspiracy" of
the workers to raise wages, they see no wrong in an "agreement" of
manufacturers or mine owners to reduce wages. If the members of a labor
union should break the law, especially if they should commit an act of
violence during a strike, the organs of capitalist opinion teem with
denunciation, but there is no breath of condemnation for the outrages
committed by employers or their agents against union men and their

During the great anthracite coal strike of 1903, and again during the
disturbances in Colorado in 1904, it was evident to every fair-minded
observer that the mine owners were at least quite as lawless as the
strikers.[124] But there was hardly a scintilla of adverse comment upon
the mine owners' lawlessness in the organs of capitalist opinion, while
they poured forth torrents of righteous indignation at the lawlessness
of the miners. When labor leaders, like the late Sam Parks, for example,
are accused of extortion and receiving bribes, the employers and their
retainers, through pulpit, press, and every other avenue of public
opinion, denounce the culprit, the bribe taker, in unmeasured terms--but
the bribe giver is excused, or, at worst, only lightly criticised. These
are but a few common illustrations of class conscience. Any careful
observer will be able to add almost indefinitely to the number.

It would be easy to compile a catalogue of such examples as these from
the history of the past few years sufficient to convince the most
skeptical that class interests do produce a class conscience. Mr. Ghent
aptly expresses a profound truth when he says: "There is a spiritual
alchemy which transmutes the base metal of self-interest into the gold
of conscience; the transmutation is real, and the resulting frame of
mind is not hypocrisy, but conscience. It is a class conscience, and
therefore partial and imperfect, having little to do with absolute
ethics. But partial and imperfect as it is, it is generally
sincere."[125] No better test of the truth of this can be made than by
reading carefully for a few weeks the comments of half a dozen
representative capitalist newspapers, and of an equal number of
representative labor papers, upon current events. The antithetical
nature of their judgments of men and events demonstrates the existence
of a distinct class conscience. It cannot be interpreted in any other


A great many people, while admitting the important rôle class struggles
have played in the history of the race, strenuously deny the existence
of classes in the United States. They freely admit the class divisions
and struggles of the Old World, but deny that a similar class antagonism
exists in this country; they fondly believe the United States to be a
glorious exception to the rule, and regard the claim that classes exist
here as falsehood and treason. The Socialists are forever being accused
of seeking to apply to American life judgments based upon European facts
and conditions. It is easy to visualize the class divisions of
monarchical countries, where there are hereditary ruling classes--even
though these are only nominally the ruling classes in most cases--fixed
by law. But it is not so easy to recognize the fact that, even in these
countries, the power is held by the financial and industrial lords, and
not by the kings and their titular nobility. The absence of a
hereditary, titular ruling class serves to hide from many people the
real class divisions existing in this country.

Nevertheless, there is a perceptible growth of uneasiness and unrest; a
widening and deepening conviction that while we may retain the outward
forms of democracy, and shout its shibboleths with patriotic fervor,
its essentials are lacking. The feeling spreads, even in the most
conservative circles, that we are developing, or have already developed,
a distinct ruling class. The anomaly of a ruling class without legal
sanction or titular prestige has seized upon the popular mind; titles
have been created for our great "untitled nobility"--mock titles which
have speedily assumed a serious import and meaning. Our financial
"Kings," industrial "Lords," "Barons," and so on, have received their
crowns and patents of nobility from the populace. President Roosevelt
gives expression to the serious thought of our most conservative
citizenry when he says: "In the past, the most direful among the
influences which have brought about the downfall of republics has ever
been the growth of the class spirit.... If such a spirit grows up in
this republic, it will ultimately prove fatal to us, as in the past it
has proven fatal to every community in which it has become

With the exception of the chattel slaves, we have had no hereditary
class in this country with a legally fixed status. But

     "Man is more than constitutions,"

and there are other laws than those formulated in senates and recorded
in statute books. The vast concentration of industry and wealth,
resulting in immense fortunes on the one hand, and terrible poverty on
the other, has separated the two classes by a chasm as deep and wide as
ever yawned between czar and moujik, kaiser and vagrant, prince and
pauper, feudal baron and serf. The immensity of the power and wealth
thus concentrated into the hands of the few, to be inherited by their
sons and daughters, tends to establish this class division hereditarily.
Heretofore, passage from the lower class to the class above has been
comparatively easy, and it has blinded people to the existing class
antagonisms, though, as Mr. Ghent justly observes, it should no more be
taken to disprove the existence of classes than the fact that so many
thousands of Germans come to this country to settle is taken to disprove
the existence of the German Empire.[127] The stereotyping of classes is
undeniable. That a few men pass from one class to another is no disproof
of this. The classes exist and the tendency is for them to remain
permanently fixed, as a whole, in our social life.

But passage from the lower class to the upper tends to become, if not
absolutely impossible and unthinkable, at least practically impossible,
and as difficult and rare as the transition from pauperism to princedom
in the Old World is. A romantic European princess may marry a penurious
coachman, and so provide the world with a nine days' sensation, but
such cases are no rarer in the royal courts of Europe than in our own
plutoaristocratic court circles. Has there ever been a king in modern
times with anything like the power of Mr. Rockefeller? Is any feature of
royal recognition withheld from Mr. Morgan when he goes abroad in state,
an uncrowned king, fraternizing with crowned but envious fellow-kings?
The existence of classes in America to-day is as evident as the
existence of America itself.


Antagonisms of class interests have existed from the very beginning of
civilization, though not always recognized. It is only the consciousness
of their existence, and the struggle which results from that
consciousness, that are new. As we suddenly become aware of the pain and
ravages of disease, when we have not felt or heeded its premonitory
symptoms, so, having neglected the fundamental class division of
society, the bitterness of the strife resulting therefrom shocks and
alarms us. So long as it is possible for the stronger and more ambitious
members of an inferior class to rise out of that class and join the
ranks of a superior class, so long will the struggle which ensues as the
natural outgrowth of opposing interests be postponed.

Until quite recently, in the United States, this has been possible.
Transition from the status of wage-worker to that of capitalist has been
easy. But with the era of concentration and the immense capitals
required for industrial enterprise, and the exhaustion of our supply of
free land, these transitions become fewer and more difficult, and class
lines tend to become permanently fixed. The stronger and more ambitious
members of the lower class, finding it impossible to rise into the class
above, thus become impressed with a consciousness of their class status.
The average worker no longer dreams of himself becoming an employer
after a few years of industry and thrift. The ambitious and aggressive
few no longer look with the contempt of the strong for the weak upon
their less aggressive fellow-workers, but become leaders, preachers of a
significant and admittedly dangerous gospel of class consciousness.

President Roosevelt has assailed the preachers of class consciousness
with all the energy of a confirmed moralizer. It is evident, however,
that he has never taken the trouble to study either the preachers or
their gospel. Never in his utterances has there been any hint given of a
recognition of the fact that there could be no preaching of class
consciousness had there been no classes. Never has he manifested the
faintest recognition of the existence of conditions which develop
classes, out of which the class consciousness of the propagandists
springs naturally. He does not see that there is danger only when the
preachers are not wise enough, nor sufficiently educated to see their
position in its historical perspective; when in blind revolt they
engender class hatred, personal hatred of the capitalist by the worker.
But when there is the historical perspective, wisdom to see that
economic conditions develop slowly, and that the capitalist is no more
responsible for conditions than the worker, there is not only no
personal hatred for the capitalist engendered, but, more important
still, the workers get a new view of the relationship of the classes,
and their efforts are directed to the bringing about of peaceful change.

The Socialists, accused as they are of seeking to stir up hatred and
strife, by placing the class struggle in its proper light, as one of the
great social dynamic forces, have done and are doing more to allay
hatred and bitterness of feeling, and to save the world from the red
curse of anarchistic vengeance, than all the Rooseveltian preaching in
which thousands of venders of moral platitudes are engaged. The
Socialist movement is vastly more powerful as a force against Anarchism,
in its violent manifestations, than any other agency in the world.
Wherever, as in Germany, the Socialist movement is strong, Anarchism is
impotent and weak. The reason for this is the very obvious one here
given. Class divisions are not created by Socialists, but developed in
the womb of economic conditions. Class consciousness is not something
which Socialism has developed. Before there was a Socialist movement, in
the days of Luddite attacks upon machinery, and Captain Swing's
rick-burners, there was class consciousness expressed in class revolt.
Modern Socialism simply takes the class consciousness of the worker and
educates it to see the futility of machine-destroying, or other foolish
and abortive attacks upon capitalists and their property, and organizes
it into a political movement for the peaceful transformation of society.


Nowhere in the world, at any time in its history, has the antagonism of
classes been more evident than in the United States at the present time.
With an average of over a thousand strikes a year,[128] some of them
involving, directly, tens of thousands of producers, a few capitalists,
and millions of noncombatants, consumers; with strikes like this,
boycotts, lockouts, injunctions, and all the other incidents of
organized class strife reported daily by the newspapers, denials of the
existence of classes, or of the struggle between them, are manifestly
absurd. We have, on the one hand, organizations of workers, labor
unions, with a membership of something over two million in the United
States; one organization alone, the American Federation of Labor, having
an affiliated membership of one million seven hundred thousand. On the
other hand, we have organizations of employers, formed for the expressed
purpose of fighting the labor unions, of which the National Association
of Manufacturers is the most perfect type yet evolved.

While the leaders on both sides frequently deny that their organizations
betoken the existence of a far-reaching fundamental class conflict, and,
through ostensibly pacificatory organizations like the National Civic
Federation, proclaim the "essential identity of interests between
capital and labor"; while an intelligent and earnest labor leader like
Mr. John Mitchell joins with an astute capitalist leader like the late
Senator Marcus A. Hanna in declaring that "there is no necessary
hostility between labor and capital," that there is no "necessary,
fundamental antagonism between the laborer and the capitalist,"[129] a
brief study of the constitutions of these class organizations, and their
published reports, in conjunction with the history of the labor struggle
in the United States, in which the names of Homestead, Hazelton, Coeur
d'Alene and Cripple Creek appear in bloody letters, will show these
denials to be the offspring of hypocrisy or delusion. If this
much-talked-of unity of interests is anything but a stupid fiction, the
great and ever increasing strife is only a matter of mutual
misunderstanding. All that is necessary to secure permanent peace is to
remove that misunderstanding. If we believe this, it is a sad commentary
upon human limitations, upon man's failure to understand his own life,
that not a single person on either side has arisen with sufficient
intelligence and breadth of vision to state the relations of the two
classes with clarity and force enough to accomplish that end, to make
them understand each other.

Let us get down to fundamental principles.[130] Why do men organize into
unions? Why was the first union started? Why do men pay out of their
hard-earned wages to support unions now? The first union was not started
because the men who started it did not understand their employers, or
because they were misunderstood by their employers. The explanation
involves a deeper insight into things than that. When the individual
workingman, feeling that from the labor of himself and his fellows came
the wealth and luxury of his employer, demanded higher wages, a
reduction of the hours of labor, or better conditions in general, he was
met with a reply from the employer--who understood the workingman's
position very well, much better, in fact, than the workingman himself
did--something like this, "If you don't like this job, and my terms,
there are plenty of others outside ready to take your place." The
workingman and the employer, then, understood each other perfectly. The
employer understood the position of the worker, that he was dependent
upon him, the employer, for opportunity to earn his bread. The worker
understood that so long as the employer could discharge him and fill his
place with another, he was powerless. The combat between the workers and
the masters of their bread has from the first been an unequal one.

Nothing remained for the individual workingman but to join with his
fellows in a collective and united effort. So organizations of workers
appeared, and the employers could not treat the demands for higher wages
or other improvements in conditions as lightly as before. The workers,
when they organized, could take advantage of the fact that there were no
organizations of the employers. Every strike added to the ordinary
terrors of the competitive struggle for the employers. The manufacturer
whose men threatened to strike often surrendered because he feared most
of all that his trade, in the event of a suspension of work, would be
snatched by his rival in business. So, by playing upon the inherent
weakness of the competitive system as it affected the employers, the
workers gained many substantial advantages. There is no doubt whatsoever
that under these conditions the wage-workers got better wages, better
working conditions, and a reduction in the hours of labor. It was in
many ways the golden age of trade unionism. But there was an important
limitation of the workers' power--the unions could not absorb the man
outside; they could not provide all the workers with employment. That is
an essential condition of capitalist industry, there is always the
"reserve army of the unemployed," to use the expressive phrase of
Friederich Engels. Rare indeed are the times when all the available
workers in any industry are employed, and the time has probably never
yet been when all the available workers in all industries were employed.

Notwithstanding this important limitation of power, it is
incontrovertible that the workers were benefited by their organization.
But only for a time. There came a time when the employers began to
organize unions also. That they called their organizations by other and
high-sounding names does not alter the fact that they were in reality
unions formed to combat the unions of the workers. Every employers'
association is, in reality, a union of the men who employ labor against
the unions of the men they employ. When the organized workers went to
individual, unorganized employers, who feared their rivals more than
they feared the workers, or, rather, who feared the workers most of all
because rivals waited to snatch their trade, a strike making their
employees allies with their competitors, the employers were easily
defeated. The workers could play one employer against another employer
with constant success. But when the employers also organized, it was
different. Then the individual employer, freed from his worst terrors,
could say, "Do your worst. I, too, am in an organization." Then it
became a battle betwixt organized capital and organized labor. When the
workers went out on strike in one shop or factory, depending upon their
brother unionists employed in other shops or factories, the employers of
these latter locked them out, thus cutting off the financial support of
the strikers. In other cases, when the workers in one place went out on
strike, the employer got his work done through other employers, by the
very fellow-members upon whom the strikers were depending for support.
Thus the workers were compelled to face this dilemma, either to withdraw
these men, thus cutting off their financial supplies, or to be beaten by
their own members.

Under these changed conditions, the workers were beaten time after time.
It was a case of the worker's cupboard against the master's warehouse,
purse against bank account, poverty against wealth. The workers' chances
are slight in such a combat! A strike means that the employers on one
side, and the workers on the other, seek to force each other to
surrender by waiting patiently to see who first feels the pinch of
hardship and poverty. Employers and employees determine to play the
waiting game. Each waits patiently in the hope that the other will
weaken. At last one--most often the workers'--side weakens and gives up
the struggle. When the workers are thus beaten in a strike, they are not
convinced that their demands are unreasonable or unjust; they are simply
beaten because their resources are too small to enable them to stand the

When the master class, the masters of jobs and bread, organized their
forces, they set narrow and sharp boundaries to the power of labor
organizations. Henceforth the chances of victory were overwhelmingly on
the side of the employers. The workers learned by bitter and costly
experience that they could not play the interests of individual
employers against other employers' interests. Meantime, too, they have
learned that they are not only exploited as producers, but also as
buyers, as consumers. For long, dominated by economic theories, the
Socialists refused to recognize this aspect of the labor struggle,
though the workers felt it strongly enough. They set their fine-spun
theories against the facts of life. Their contention was that wages
being determined by the cost of living, it mattered nothing how much or
how little the workers got in wages, the cost of living and wages
adjusted themselves to each other. But in actual experience the workers
found that when prices fall, wages are _quick_ to follow, whereas when
prices soar high, wages are _slow_ to follow. Wages climb with leaden
feet when prices soar with eagle wings. Because the workers are
consumers, almost to the last penny of their incomes, having to spend
practically every penny earned, that form of exploitation becomes a
serious matter.

But against this exploitation the unions have ever been absolutely
powerless. Workingmen have never made any very serious attempt to
protect the purchasing capacity of their wages, notwithstanding its
tremendous importance.[131] The result has been that not a few of the
"victories" so dearly won by trade union action have turned out to be
hollow mockeries. When better wages have been secured, prices have often
gone up, most often, in fact, so that the net result has been little to
the advantage of the workers. In many cases, where the advance in wages
applied only to a restricted number of trades, the advance in prices
becoming general, the total result has been against the working class as
a whole, and little or nothing to the advantage of the few who received
the advance in immediate wages. At this point, the need is felt of a
social revolution, not a violent revolution, be it understood, but a
comprehensive social change which will give to the workers the control
of the implements of labor, and also of the product of their labor. In
other words, the demand arises for independent, working-class action,
aiming at the socialization of the means of production and the product.


A line of cleavage thus presents itself between those, on the one hand,
who would continue the old methods of economic warfare, together with
the advocates of physical force, and, on the other hand, the advocates
of united political action by the working class, consciously directed
toward the socialization of industry and its products. The measure of
the crystallization of this latter force is represented by the strength
of the political Socialist movement. Whoever has studied the labor
movement during the past few years must have realized that there is a
tremendous drift of sentiment in favor of that policy in the labor
unions of the country. The clamor for political action in the labor
unions presages an enormous advance of the political Socialist movement
during the next few years.

The struggle between the capitalist and working classes must become a
political issue, the supreme political issue. This must result, not only
because the collective ownership of property can best be brought about
by political methods, but also because the capitalists themselves have
taken the industrial struggle into the political arena to suit
themselves; and when the workers realize the issue and accept it, the
capitalists will not be able to resist them. One is reminded of the
saying of Marx that capitalism produces its own gravediggers. In taking
the industrial issue into the political sphere, to suit their own
immediate advantages, the capitalists were destined to reveal to the
workers, sooner or later, their power and opportunity.

Realizing that all the forces of government are on their side, the
legislative, judicial, and executive powers being controlled by their
own class, the employers have made the fight against labor political as
well as economic in its character. When the workers have gone on strike
and the employers have not cared to play the "waiting game," choosing
rather to avail themselves of the great reserve army of unemployed
workers outside, the natural resentment of the strikers, finding
themselves in danger of being beaten by members of their own class, has
led to violence which has been remorselessly suppressed by all the
police and military forces at the command of the government. In many
instances, the employers have purposely provoked striking workers to
violence, and then called upon the government to crush the revolt thus
made. Workers have been shot down at the shambles in almost every state,
no matter which political party has been in power. Nor have these forces
of our class government been used merely to punish lawless union men and
women on strike, to uphold the "sacred majesty of the law," as the
hypocritical phrase goes. They have been also used to deny strikers the
rights which belonged to them, and to protect capitalists and their
agents in breaking the laws. No one can read with anything like an
impartial spirit the records of the miners' strike in the Coeur
d'Alene mine, Idaho, or the labor disturbances in the state of Colorado
from 1880 to 1905 and dispute this assertion.

Most important of all has been the powerful opposition of the makers and
interpreters of the law. A body of class legislation, in the interests
of the employing class, has been created, while the workers have begged
in vain for protective legislation. In no country of the world have the
interests of the workers been so neglected as in the United States.
There is practically no such thing as employers' liability for accidents
to workers; no legislation worthy of mention relating to occupations
which have been classified as "dangerous" in most industrial countries;
women workers are sadly neglected. Whenever a law of distinct advantage
to the workers in their struggle has been passed, a servile judiciary
has been ready to render it null and void by declaring it to be
unconstitutional. No more powerful blows have ever been directed against
the workers than by the judiciary. Injunctions have been issued, robbing
the workers of the most elemental rights of manhood and citizenship.
They have forbidden things which no law forbids, and even things which
the Constitution and statute law declare to be legal.

Mr. John Mitchell refers to this subject, in strong but not too strong
terms. "No weapon," he says, "has been used with such disastrous effect
against trade unions as the injunction in labor disputes. By means of
it, trade unionists have been prohibited under severe penalties from
doing what they had a legal right to do, and have been specifically
directed to do what they had a legal right not to do. It is difficult to
speak in measured tones or moderate language of the savagery and venom
with which unions have been assailed by the injunction, and to the
working classes, as to all fair-minded men, it seems little less than a
crime to condone or tolerate it."[132] This is strong language, but who
shall say that it is too strong when we remember the many injunctions
which have been hurled at organized labor since the famous Debs case
brought this weapon into general use?

In this celebrated case, which grew out of the Pullman strike, in 1894,
Eugene V. Debs, president of the American Railway Union, was arrested
and arraigned on indictments of obstructing the mails and interstate
commerce. Although arraigned, he was not tried, the case being
abandoned, despite his demands for a trial. President Cleveland's strike
commission subsequently declared, "There is no evidence before the
commission that the officers of the American Railway Union at any time
participated in or advised intimidation, violence, or destruction of
property." Realizing that it had no sort of evidence upon which a jury
might be hoped to convict, a new way was found. Debs and his officers
were enjoined in a famous "blanket" injunction directed against Debs and
all other officials of the union, and "all persons whomsoever." For an
alleged violation of that injunction, Judge Woods, without trial by
jury, sentenced Debs to six months' imprisonment and his associates to
three months'. The animus and class bias of the whole proceeding may be
judged from the fact that President Cleveland selected to represent the
United States Government, at Chicago, Mr. Edwin Walker, general counsel
at that very time for the General Managers' Association, representing
the twenty-four railroads centering or terminating in Chicago. And these
railroads were operating in violation of the Sherman Anti-Trust Law at
the time.[133]

In 1899 an injunction was issued out of the United States Circuit Court
of West Virginia against "John Smith and others," without naming the
"others," in the interest of the Wheeling Railway Company. Two men,
neither of them being John Smith, nor found to be the agent of "John
Smith and others," were jailed for contempt of court![134] In 1900
members of the International Cigarmakers' Union, in New York City, were
enjoined by Justice Freeman, in the Supreme Court, from even approaching
their former employers for the purpose of attempting to arrange a
peaceable settlement! The cigarmakers were further enjoined from
publishing their grievances, or in any manner making their case known to
the public, if the tendency of that should be to vex the plaintiffs or
make them uneasy; from trying, even in a peaceful way, in any place in
the city, even in the privacy of a man's own home, to persuade a new
employee that he ought to sympathize with the union cause sufficiently
to refuse to work for unjust employers; and, finally, the union was
forbidden to pay money to its striking members to support them and their
families. In the great steel strike of 1901, the members of the
Amalgamated Association of Iron and Steel Workers were enjoined from
peaceably discussing the merits of their claim with the men who were at
work, even though the latter might raise no objection. In Pennsylvania,
in the case of the York Manufacturing Company _vs._ Obedick, it was held
that workmen had "no legal right" to persuade or induce other workmen to
quit, or not to accept, employment.[135] In the strike of the members of
the International Typographical Union against the Buffalo _Express_, the
strikers were enjoined from discussing the strike, or talking about the
paper in any way which might be construed as being against the paper. If
one of the strikers advised a friend not to buy a "scab" paper, he was
liable under the terms of that injunction to imprisonment for contempt
of court. The members of the same union were, in the case of the Sun
Printing and Publishing Company _vs_. Delaney and others, enjoined by
Justice Bookstaver, in the Supreme Court of New York, from publishing
their side of the controversy with the _Sun_ as an argument why persons
friendly to organized labor should not advertise in a paper hostile to
it. In 1906 members of the same union were enjoined by Supreme Court
Justice Gildersleeve from "making any requests, giving any advice, or
resorting to any persuasion ... to overcome the free will of any person
connected with the plaintiff [a notorious anti-union publishing company]
or its customers as employees or otherwise."[136]

These are only a few examples of the abuse of the injunction in labor
disputes, hundreds of which have been granted, many of them equally
subversive of all sound principles of popular government. There is
probably not another civilized country in which such judicial tyranny
would be tolerated. It is not without significance that in West
Virginia, where, as a result of an outcry against a number of
particularly glaring abuses of the power to issue injunctions, the
legislature passed a law limiting the right to issue injunctions, the
Supreme Court decided that the law was unconstitutional, upon the ground
that the legislature had no right to attempt to restrain the courts
which were coördinate with itself.

Even more dangerous to organized labor than the injunction is what is
popularly known by union men as "Taff Vale law." Our judges have not
been slow to follow the example set by the English judges in the famous
case of the Taff Vale Railway Company against the officers of the
Amalgamated Society of Railway Servants, a powerful labor organization.
The decision in that case was most revolutionary. It compelled the
workers to pay damages, to the extent of $115,000, to the railroad
company for losses sustained by the company through a strike of its
employees, members of the defendant union. That decision struck terror
into the hearts of British trade unionists. At last they had to face a
mode of attack even more dangerous than the injunction which their
transatlantic brethren had so long been contending against. Taff Vale
law could not long be confined to England. Very soon, our American
courts followed the English example. A suit was instituted against the
members of a lodge of the Machinists' Union in Rutland, Vermont, and the
defendants were ordered to pay $2500. A writ was served upon each member
and the property of every one of them attached. Since that time,
numerous other decisions of a like nature have been rendered in various
parts of the country. Thus the unions have been assailed in a vital
place, their treasuries. It is manifestly foolish and quite useless for
the members of a union to strike against an employer for any purpose
whatever, if the employer is to be able to recover damages from the
union. Taff Vale judge-made law renders the labor union _hors de combat_
at a stroke.


The immediate effect of the revolutionary judicial decision in England
was to arouse the workers to the necessity for class-conscious political
action. The cry went up that the unions must adopt a policy of
independent political action. There is no doubt whatever that the
tremendous advance of the Socialist movement in England during the past
few years began as a result of the attack made upon the funds of the
labor unions. From the moment of the Taff Vale decision the Socialist
movement in England took rapid strides. A similar process is going on in
this country, gathering momentum with every injunction against organized
labor, every hostile enactment of legislatures, and every use of the
judicial and executive powers to defeat the workers in their struggle
against capitalism. The workers are being educated to political
Socialism by the stern experiences resulting from capitalist rule.
Underneath the thin veneer of party differences, the worker sees the
class identity of the great political parties, and cries out, "A plague
on both your houses!" The Socialist argument comes to him with a twofold
force: not only does it show him how he is enslaved and exploited as a
producer, but it convinces him that as a citizen he has it in his power
to control the government and make it what he will. He can put an end to
government by injunctions, to the use of police, state, and federal
troops to break strikes, and to the sequestration of union funds by
hostile judges. He can, if he so decides, own and control the
government, and, through the government, own and control the essentials
of life: be master of his own labor, his own bread, his own life.

If we take for granted that the universal increase of Socialist
sentiment, and the growth of political Socialism, as measured by its
rapidly increasing vote, presage this great triumph of the working
class; that the heretofore despised and oppressed proletariat is, in a
not far distant future, to rule instead of being ruled, the question
arises, will the last state be better than the first? Will society be
bettered by the change of masters?

The very form of the question must be denied. It is not a movement for a
change of masters. To regard this struggle of the classes as one of
revenge, of exploited masses ready to overturn the social structure that
they may become exploiters instead of exploited, is to misread the whole
movement. The political and economic conquest of society by the working
class means the end of class divisions once and forever. A social
democracy, a society in which all things essential to the common life
and well-being are owned and controlled by the people in common,
democratically organized, precludes the existence of class divisions in
our present-day economic and political sense. Profit, through human
exploitation, alone has made class divisions possible, and the Socialist
régime will abolish profit. The working class, in emancipating itself,
at the same time makes liberty possible for the whole race of man, and
destroys the conditions of class rule.


[116] The _Communist Manifesto_, Kerr edition, page 8.

[117] In _Centralization and the Law: Scientific Legal Education, An
Illustration_, edited by Melville M. Bigelow.

[118] See, for instance, _The Coal Mine Workers_, by Frank Julian Warne,
Ph.D. (1905).

[119] Adam Smith, _The Wealth of Nations_, Vol. I, Book I, Chapter VIII.

[120] _The Common Sense of Socialism_, by John Spargo, page 131 (1908).

[121] See, for instance, _The American Farmer_, by A. M. Simons, page
130; _Agrarfrage_, by Karl Kautsky, pages 305-306.

[122] Mr. Ghent's excellent work, _Mass and Class_, and Karl Kautsky's
_Ethics and the Materialistic Conception of History_, may be named as
excellent examples of what Socialists have done in this direction.

[123] In _The Worker_ (New York), March 25, 1905.

[124] Cf., for instance, _The Labor History of the Cripple Creek
District_, by Benjamin McKie Rastall (1908), and Senate Document No.
122, being _A Report on Labor Disturbances in the State of Colorado,
from 1880 to 1904, Inclusive_, by Carroll D. Wright (1905), for evidence
of this from sources not specially friendly to the miners.

[125] _Mass and Class_, page 101.

[126] _Message to Congress_, January, 1906.

[127] _Mass and Class_, page 53.

[128] Vide _War of the Classes_, by Jack London, page 17.

[129] _Organized Labor_, by John Mitchell, page ix.

[130] The remainder of this chapter is largely reproduced from my little
pamphlet, _Shall the Unions go into Politics?_

[131] This aspect of the exploitation of the laborers has been brought
to the front very dramatically by the many recent "strikes" against high
rents and high prices for meat and other commodities. Rent strikes and
riots against high prices have become common events in our large cities.

[132] _Organized Labor_, by John Mitchell, page 324.

[133] See _Report of Commission of Investigation_, Senate Ex. Doc. No.
7, Fifty-third Congress, third session.

[134] Particulars are taken from a pamphlet by five members of the New
York Bar and issued by the Social Reform Club, New York, in 1900.

[135] See the article by Judge Seabury, _The Abuses of Injunctions, in
The Arena_, June, 1903.

[136] See the New York daily papers, January 31, 1906.




The first approach to a comprehensive treatment by Marx of the
materialistic conception of history appeared in 1847, several months
before the publication of the _Communist Manifesto_, in "La Misère de la
Philosophie,"[137] the famous polemic with which Marx assailed J. P.
Proudhon's _La Philosophie de la Misère_. Marx had worked out his theory
at least two years before, so Engels tells us, and in his writings of
that period there are several evidences of the fact. In "La Misère de la
Philosophie," the theory is fundamental to the work, and not merely the
subject of incidental allusion. This little book, all too little known
in England and America, is therefore important from this historical
point of view. In it, Marx for the first time shows his complete
confidence in the theory. It needed confidence little short of sublime
to challenge Proudhon in the audacious manner of this scintillating
critique. The torrential eloquence, the scornful satire, and fierce
invective of the attack, have rather tended to obscure for readers of a
later generation the real merit of the book, the importance of the
fundamental idea that history must be interpreted in the light of
economic development, that economic evolution determines social life.
The book is important for two other reasons. First, it was the author's
first serious essay in economic science--in the preface he boldly and
frankly calls himself an economist--and, second, in it appears a full
and generous recognition of that brilliant coterie of English Socialist
writers of the Ricardian school from whom Marx has been unjustly, and
almost spitefully, charged with "pillaging" his principal ideas.

What led Marx to launch out upon the troubled sea of economic science,
when all his predilections were for the study of pure philosophy, was
the fact that his philosophical studies had led him to a point whence
further progress seemed impossible, except by way of economics. The
Introduction to "A Contribution to the Critique of Political Economy"
makes this perfectly clear. Having decided that "the method of
production in material existence conditions social, political, and
mental evolution in general," a study of economics, and especially an
analysis of modern industrial society, became inevitable. During the
year 1845, when the theory of the economic interpretation of history was
absorbing his attention, Marx spent six weeks in England with his
friend Engels, and became acquainted with the work of the Ricardian
Socialists already referred to.[138] Engels had been living in England
about three years at this time, and had made an exhaustive investigation
of industrial conditions there, and become intimately acquainted with
the leaders of the Chartist movement. His fine library contained most of
the works of contemporary writers, and it was thus that Marx came to
know them.

Foremost of this school of Socialists which had arisen, quite naturally,
in the land where capitalism flourished at its best, were William
Godwin, Charles Hall, William Thompson, John Gray, Thomas Hodgskin, and
John Francis Bray. With the exception of Hall, of whose privately
printed book, "The Effects of Civilisation on the People of the European
States," 1805, he seems not to have known, Marx was familiar with the
writings of all the foregoing, and his obligations to some of them,
especially Thompson, Hodgskin, and Bray, were not slight. While the
charge, made by Dr. Anton Menger,[139] among others, that Marx took his
surplus value theory from Thompson is quite absurd, and rests, as
Bernstein has pointed out, upon nothing but the fact that Thompson used
the words "surplus value" frequently, but not at all in the same sense
as that in which Marx uses them,[140] we need not attempt to dispute the
fact that Marx gleaned much of value from Thompson and the two other
writers. While criticising them, and pointing out their shortcomings,
Marx himself frequently pays tributes of respect to each of them. His
indebtedness to any of them, or to all of them, consists simply in the
fact that he recognized the germinal truths in their writings, and saw
far beyond what they saw.

Godwin's most important work, "An Inquiry Concerning Political Justice,"
appeared in 1793, and contains the germ of much that is called Marxian
Socialism. In it may be found the broad lines of the thought which marks
much of our present-day Socialist teaching, especially the criticism of
capitalist society. Marx, however, does not appear to have been directly
influenced by it to any extent. That he was influenced by it indirectly,
through William Thompson, Godwin's most illustrious disciple, is,
however, quite certain. Thompson wrote several works of a Socialist
character, of which "An Inquiry into the Principles of the Distribution
of Wealth most Conducive to Human Happiness, Applied to the newly
proposed System of Voluntary Equality of Wealth," 1824, and "Labour
Rewarded. The Claims of Labour and Capital Conciliated, or How to Secure
to Labour the Whole Products of its Exertions," 1827, are the most
important and best known. Thompson must be regarded as one of the
greatest precursors of Marx in the development of modern Socialist
theory. A Ricardian of the Ricardians, he states the law of wages in
language that is almost as emphatic as Lassalle's famous _Ehernes
Lohngesetz_, which Marx made the butt of his satire.[141] Accepting the
view of Ricardo,--and indeed, of Adam Smith and other earlier English
economists, including Petty,--that labor is the sole source of exchange
value,[142] he shows by cogent argument the exploitation of the laborer,
and uses the term "surplus value" to designate the difference between
the cost of maintaining the laborer and the value of his labor product,
assisted, of course, by machinery and other capital, which goes to the
capitalist. By a most labored argument, Professor Anton Menger has
attempted to create the impression that Marx took, without
acknowledgment, his _theory of the manner in which surplus value is
produced_ from Thompson, simply because Thompson frequently used the
_term itself_.[143] Marx never claimed to have originated the term. It
is to be found in the writings of earlier economists than Thompson even,
and Marx quotes an anonymous pamphlet entitled _The Source and Remedy of
the National Difficulties_. _A Letter to Lord John Russell_, published
in London in 1821, in which the phrase "the quantity of the surplus
value appropriated by the capitalist" appears.[144] Nor did Marx claim
to be the first to distinguish surplus value. That had been done very
clearly by many others, including Adam Smith.[145] What is original in
Marx is the explanation of the manner in which surplus value is

John Gray's "A Lecture on Human Happiness," published in 1825, has been
described by Professor Foxwell as being "certainly one of the most
remarkable of Socialist writings,"[146] and the summary of the rare
little work which he gives amply justifies the description. Gray
published other works of note, two of which, "The Social System, a
Treatise on the Principle of Exchange," 1831, and "Lectures on the
Nature and Use of Money," 1848, Marx subjects to a rigorous criticism in
"A Contribution to the Critique of Political Economy." Thomas Hodgskin's
best-known works are "Labour Defended against the Claims of Capital,"
1825, and "The Natural and Artificial Right of Property Contrasted,"
1832. The former, which Marx calls "an admirable work," is only a small
tract of thirty-four pages, but its influence in England and America was
very great. Hodgskin was a man of great culture and erudition, with a
genius for popular writing upon difficult topics. It is interesting to
know that in a letter to his friend, Francis Place, he sketched a book
which he proposed writing, "curiously like Marx's 'Capital,'" according
to Place's biographer, Mr. Wallas,[147] and from which the conservative
old reformer dissuaded him. John Francis Bray was a journeyman printer
about whom very little is known. His "Labour's Wrongs and Labour's
Remedy," published in Leeds in 1839, Marx calls "a remarkable work," and
in his attack upon Proudhon he quotes from it extensively to show that
Bray had anticipated the French writer's theories.[148]

The justification for this lengthy digression from the main theme of the
present chapter lies in the fact that so many critics have sought to
fasten the charge of dishonesty upon Marx, and claimed that the ideas
with which his name is associated were taken by him, without
acknowledgment, from these English Ricardians. As a matter of fact, no
economist of note ever quoted his authorities, or acknowledged his
indebtedness to others, more generously than did Marx, and it is
exceedingly doubtful whether even the names of the precursors whose
ideas he is accused of stealing would be known to his critics but for
his frank recognition of them. No candid reader of Marx can fail to
notice that he is most careful to show how nearly these writers
approached the truth as he conceived it.


When the February revolution of 1848 broke out, Marx was in Brussels.
The authorities there compelling him to leave Belgian soil, at the
request of the Prussian government, he returned to Paris, but not for a
long stay. The revolutionary struggle in Germany stirred his blood, and
with Engels, Wilhelm Wolf, the intimate friend to whom he later
dedicated the first volume of "Capital," and Ferdinand Freiligrath, the
fiery poet of the movement, Marx started the _New Rhenish Gazette_.
Unlike the first _Rhenish Gazette_, the new journal was absolutely free
from control by business policy. Twice Marx was summoned to appear at
the Cologne assizes, upon charges of inciting the people to rebellion,
and each time he defended himself with superb audacity and skill, and
was acquitted. But in June, 1849, the authorities suppressed the paper,
because of the support it gave to the risings in Dresden and the Rhine
Province. Marx was expelled from Prussia and once more sought a refuge
in Paris, which he was allowed to enjoy only for a very brief time.
Forbidden by the French government to stay in Paris, or any other part
of France except Brittany, which, says Liebknecht, was considered
"fireproof," Marx turned to London, the mecca of all political exiles,
arriving there toward the end of June, 1849.

His removal to London was one of the crucial events in the life of Marx.
It became possible for him, in the classic land of capitalism, to pursue
his economic studies in a way that was not possible anywhere else in the
world. As Liebknecht says: "Here in London, the metropolis (mother city)
and the center of the world, and of the world of trade--the watch tower
of the world whence the trade of the world and the political and
economical bustle of the world may be observed, in a way impossible in
any other part of the globe--here Marx found what he sought and needed,
the bricks and mortar for his work. 'Capital' could be created in London

Already much more familiar with English political economy than most
English writers of his time, and with the fine library of the British
Museum at his command, Marx felt that the time had at last arrived when
he could devote himself to his long-cherished plan of writing a great
treatise upon political economy as a secure basis for the theoretical
structure of Socialism. With this object in view, he resumed his
economic studies in 1850, soon after his arrival in London. The work
proceeded slowly, however, principally owing to the long and bitter
struggle with poverty which encompassed Marx and his gentle wife. For
years they suffered all the miseries of acute poverty, and even
afterward, when the worst was past, the principal source of income, at
times almost the only source in fact, was the five dollars a week
received from the _New York Tribune_, for which Marx acted as special
correspondent, and to which he contributed some of his finest work.[150]
There are few pictures more pathetic, albeit also heroic, than that
which we have of the great thinker and his devoted wife struggling
against poverty during the first few years of their stay in London.
Often the little family suffered the pangs of hunger, and Marx and a
group of fellow-exiles used to resort to the reading room of the British
Museum, weak from lack of food very often, but grateful for the warmth
and shelter of that hospitable spot. The family lived some time in two
small rooms in a cheap lodging house on Dean Street, the front room
serving as reception room and study, and the back room serving for
everything else. In a diary note, Mrs. Marx has herself left us an
impressive picture of the suffering of those early years in London.
Early in 1852, death entered the home for the first time, taking away a
little daughter. Only a few weeks later another little daughter died,
and Mrs. Marx wrote concerning this event:--

"On Easter of the same year--1852--our poor little Francisca died of
severe bronchitis. Three days the poor child was struggling with death.
It suffered so much. Its little lifeless body rested in the small back
room; we all moved together into the front room, and when night
approached, we made our beds on the floor. There the three living
children were lying at our side, and we cried about the little angel,
who rested cold and lifeless near us. The death of the dear child fell
into the time of the most bitter poverty ... (the money for the burial
of the child was missing). In the anguish of my heart I went to a French
refugee who lived near, and who had sometimes visited us. I told him our
sore need. At once with the friendliest kindness he gave me two pounds.
With that we paid for the little coffin in which the poor child now
sleeps peacefully. I had no cradle for her when she was born, and even
the last small resting place was long denied her. What did we suffer
when it was carried away to its last place of rest!"[151]

The poverty, of which we have here such a graphic view, lasted for
several years beyond the publication of the "Critique," on to the
appearance of the first volume of "Capital." When this struggle is
remembered and understood, it becomes easier to appreciate the life work
of the great Socialist thinker. "It was a terrible time, but it was
grand nevertheless," wrote Liebknecht years afterward to Eleanor Marx.
As this is the last place in which the personality of Marx, or his
personal affairs, will be discussed in this volume, and in view of
constant misrepresentations on the part of unscrupulous opponents of
Socialism, a further word concerning his family life may not be out of
place. Those persons who regard Socialism as being antagonistic to the
family relation, and fear it in consequence, will find no suggestion of
support for that view in either the life of Marx or his teaching. The
love of Marx and his wife for each other was beautiful and idyllic. A
true account of their love and devotion would rank with the most
beautiful love stories in literature. Their friends understood that,
too, and there is a world of significance in the one brief sentence
spoken by Engels, when told of the death of his friend's beautiful wife,
who was likewise his own dear friend: "Mohr [Negro, a nickname given to
Marx by his friends when young, on account of his mass of black hair and
whiskers] is dead too," he said simply. He knew that from this blow Marx
could not recover. It was indeed true. Though he lingered on for about
three months after her death, the life of Marx really ended when the
playmate of his boyhood, and the lover and companion of all the years of
struggle, died with the name of her dear "Karl" upon her lips.

Marx was an ideal father as well as an ideal husband. Always
passionately fond of children, he could not resist the temptation to
join the games of children upon the streets, and in the neighborhoods
where he lived the children soon learned to regard him as their friend.
To his own children he was a real companion, always ready to amuse and
to be amused by them.


The studious years spent in the reading room of the British Museum
complete the anglicization of Marx. "Capital" is essentially an English
work, the fact of its having been written in German, by a German writer,
being merely incidental. No more distinctively English treatise on
political economy was ever written, not even "The Wealth of Nations."
Even the method and style of the book are, contrary to general opinion,
much more distinctly English than German. I do not forget his Hegelian
dialectic with its un-English subtleties, but against that must be
placed the directness, vigor, and pointedness of style, and the cogent
reasoning, with its wealth of concrete illustrations, which are as
characteristically English. Marx belongs to the school of Petty, Smith,
and Ricardo, and their work is the background of his. "Capital" was the
child of English industrial conditions and English thought, born by
chance upon German soil.

Toward the middle of the nineteenth century, English economic thought
was entirely dominated by the ideas and methods of Ricardo, who has been
described by Senior, not without justice, as "the most incorrect writer
who ever attained philosophical eminence."[152] So far as such a
sweeping criticism can be justified by looseness in the use of terms, it
is justified by Ricardo's failing in this respect. That he should have
attained the eminence he did, dominating English economic thought for so
many years, in spite of the confusion which his loose and uncertain use
of words occasioned, is not less a tribute to Ricardo's genius than
evidence of the poverty of political economy in England at that time. In
view of the constant and tiresome reiteration of the charge that Marx
pillaged his labor-value theory from Thompson, Hodgskin, Bray, or some
other more or less obscure writer of the Ricardian school, it is well to
remember that there is nothing in the works of any of these writers
connected with the theory of value which is not to be found in the
earlier work of Ricardo himself. In like manner, the theory can be
traced back from Ricardo to the master he honored, Adam Smith.
Furthermore, almost a century before the appearance of "The Wealth of
Nations," Sir William Petty had anticipated the so-called Ricardian
labor-value theory of Smith and his followers.

Petty, rather than Smith, is entitled to be regarded as the founder of
the classical school of political economy, and Cossa justly calls him
"one of the most illustrious forerunners of the science of statistical
research."[153] He may indeed fairly be said to have been the father of
statistical science, and was the first to apply statistics, or
"political arithmetick," as he called it, to the elucidation of economic
theory. He boasts that "instead of using only comparative and
superlative Words, and intellectual Arguments," his method is to speak
"in Terms of Number, Weight, or Measure; to use only Arguments of Sense;
and to consider only such Causes, as have visible Foundations in Nature;
leaving those that depend upon the mutable Minds, Opinions, Appetites,
and Passions of particular Men, to the Consideration of others."[154]
The celebrated saying of this sagacious thinker that "labor is the
father and active principle of wealth; lands are the mother," is more
Marxian than Ricardian. Petty divided the population into two classes,
the productive and non-productive, and insisted that the value of all
things depends upon the labor it costs to produce them. This is, as we
shall see, entirely Ricardian, but not Marxian. But these are the ideas
Marx is supposed to have borrowed, without acknowledgment, from
comparatively obscure followers of Ricardo, in spite of the fact that he
gives abundant credit to the earlier writer. It has been asked with
ample justification whether these critics of Marx have read either the
works of Marx or his predecessors.

Adam Smith, who accepted the foregoing principles laid down by Petty,
followed his example of basing his conclusions largely upon observed
facts instead of abstractions. It is not the least of Smith's merits
that, despite his many digressions, looseness of phraseology, and other
admitted defects, his love for the concrete kept his feet upon the solid
ground of fact. With his successors, notably Ricardo and John Stuart
Mill, it was far otherwise. They made political economy an isolated
study of abstract doctrines. Instead of a study of the meaning and
relation of facts, it became a cult of abstractions, and the aim of its
teachers seemed to be to render the science as little scientific, and
as dull, as possible. They set up an abstraction, an "economic man," and
created for it a world of economic abstractions. It is impossible to
read either Ricardo or John Stuart Mill, but especially the latter,
without feeling the artificiality of the superstructures they created,
and the justice of Carlyle's description of such political economy as
the "dismal science." With a realism greater even than Adam Smith's, and
a more logical method than Ricardo or John Stuart Mill, Marx restored
the science of political economy to its old fact foundations.


The superior insight of Marx is shown in the very first sentence of his
great work. The careful reader at once perceives that the first
paragraph of the book strikes a keynote which distinguishes it from all
other economic works comparable to it in importance. Marx was a great
master of the art of luminous and exact definition, and nowhere is this
more strikingly shown than in this opening sentence of "Capital": "The
wealth of those societies _in which the capitalist mode of production
prevails_ presents itself as an immense accumulation of commodities, its
unit being a single commodity."[155] In this simple, lucid sentence the
theory of social evolution is clearly implied. The author repudiates,
by implication, the idea that it is possible to lay down universal or
eternal laws, and limits himself to the exploration of the phenomena
appearing in a certain stage of historical development. We are not to
have another abstract economic man with a world of abstractions all his
own; lone, shipwrecked mariners upon barren islands, imaginary
communities nicely adapted for demonstration purposes in college class
rooms, and all the other stage properties of the political economists,
are to be entirely discarded. Our author does not propose to give us a
set of principles by which we shall be able to understand and explain
the phenomena of human society at all times and in all places--the
Israel of the Mosaic Age, the nomadic life of Arab tribes, Europe in the
Middle Ages, and England in the nineteenth century.

In effect, the passage under consideration says: "Political economy is
the study of the principles and laws governing the production and
distribution of wealth. Because of the fact that in the progress of
society different systems of wealth production and exchange, and
different concepts of wealth, prevail at different times, and at various
places at the same time, we cannot formulate any laws which will apply
to all times and all places. We must choose for examination and study a
certain form of production, representing a particular stage of
historical development, and be careful not to attempt to apply any of
its laws to other forms of production, representing other stages of
development. We might have chosen to investigate the laws which governed
the production of wealth in the ancient Babylonian Empire, or in
Mediæval Europe, had we so desired, but we have chosen instead the
period in which we live."

This that we call the capitalist epoch has grown out of the geographical
discoveries and the mechanical inventions of the past three hundred
years or so, especially of the seventeenth and eighteenth centuries. Its
chief characteristic, from an economic point of view, is that of
production for sale instead of direct use as in earlier stages of social
development. Of course, barter and sale are much older than this epoch
which we are discussing. In all ages men have exchanged their surplus
products for other things more desirable to them, either directly by
barter or through some medium of exchange. In the very nature of things,
however, such exchange as this must have been incidental to the life of
the people engaging in it, and not its principal aim. Under such
conditions of society wealth consists in the possession of useful
things. The naked savage, so long as he possessed plenty of weapons, and
could get an abundance of fish or game, was, from the viewpoint of the
society in which he lived, a wealthy man. In other words, the wealth of
pre-capitalist society consisted in the possession of use-values, and
not of exchange-values. Robinson Crusoe, for whom the possibility of
exchange did not exist, was, from this pre-capitalist viewpoint, a very
wealthy man.

In our present society, production is carried on primarily for exchange,
for sale. The first and essential characteristic feature of wealth in
this stage of social development is that it takes the form of
accumulated exchange-values, or commodities. Men are accounted rich or
poor according to the exchange-values they can command, and not
according to the use-values they can command. To use a favorite example,
the man who owns a ton of potatoes is far richer in simple use-values
than the man whose only possession is a sack of diamonds, but, because
in present society a sack of diamonds will exchange for an almost
infinite quantity of potatoes, the owner of the diamonds is much
wealthier than the owner of the potatoes. The criterion of wealth in
capitalist society is exchangeable value as opposed to use-value, the
criterion of wealth in primitive society. The unit of wealth is
therefore a commodity, and we must begin our investigation with it. If
we can analyze the nature of a commodity so that we can understand how
and why it is produced, and how and why it is exchanged, we shall be
able to understand the principle governing the production and exchange
of wealth in this and every other society where similar conditions
prevail, where, that is to say, the unit of wealth is a commodity, and
wealth consists in an accumulation of commodities.


The visit to America, in 1907, of a distinguished English critic of
Socialism, Mr. W. H. Mallock, had the effect of thrusting into
prominence a common misconception of Marxian Socialism, and it is highly
significant that, except in the Socialist press, none of the numerous
comments which the series of university lectures delivered by that
gentleman occasioned, called attention to the fact that they were based
throughout upon a misstatement of the Marxian position. Briefly, Mr.
Mallock insisted that Marx believed and taught that all wealth is
produced by manual labor, and that, therefore, it ought to belong to the
manual workers. In order that there may be no misstatement of our
amiable critic's position, it will be best to quote his own words. He
says, in Lecture I: "The practical outcome of the scientific economics
of Marx is summed up in the formula which is the watchword of popular
Socialism. 'All wealth is due to labor; therefore all wealth ought to go
to the laborer'--a doctrine in itself not novel, but presented by Marx
as the outcome of an elaborate system of economics"[156] (page 6). The
careful reader will notice that Mr. Mallock does not profess to give
the exact words of Marx, nor refer to any particular passage, but says
that the formula quoted by him is the "practical outcome" of the
economic system of Marx, "presented by Marx" as such. But to quote
again: "Wealth, says Marx, not only ought to be, but actually can be
distributed amongst a certain class of persons, namely, the laborers....
Because these laborers comprise in the acts of labor everything that is
involved in the production of it" (page 7). Again: " ... Marx makes of
his doctrine that labor alone produces all economic wealth" (page 7).
Also: " ... that theory of production which the genius of Karl Marx
invested with a semblance, at all events, of sober, scientific truth,
and which ascribes all wealth to that _ordinary manual labor which
brings the sweat to the brow of the ordinary laboring man_" (page
12).[157] All the foregoing passages are taken from a single lecture,
the first of the series. We will take only a few from the others: " ...
the doctrine of Marx that all productive effort is absolutely equal in
productivity" (Lecture III, page 46); "Marx based the ethics of
distribution on what purported to be an analysis of production" (Lecture
IV, page 61); " ... Count Tolstoy, ... like Socialists of the school of
Marx, declares that ordinary manual labor is the source of all wealth"
(Lecture IV, page 76). "One is the attempt of Marx and his school,
which represents ordinary manual labor as the sole producer of wealth"
(Lecture IV, page 81); " ... the Marxian doctrine ... that manual labor
is the sole producer of wealth" (Lecture V, page 115). It would be easy
to add many other quotations very similar to these, but it is
unnecessary. From the quotations given we can gather Mr. Mallock's
conception of what Marx taught regarding the source of wealth.

It will be seen that Mr. Mallock alleges: (1) That Marx believed and
taught that all wealth is produced by ordinary manual labor; (2) that he
held, as a consequence, that all wealth ought to belong to the manual
laborers, thus basing an ethic of distribution upon production; (3) that
he taught that all productive effort is absolutely equal in productive
value, in other words, that ten hours' work of one kind is economically
as valuable as ten hours' of any other kind, so long as the labor is

It is not easy to command the necessary self-restraint to reply with
dignity to such wholesale misrepresentation as this. There is not the
slightest scintilla of a foundation in fact for any one of the three
statements. Not a single passage can be quoted from Marx which justifies
any one of them. As we shall see, Marx specifically repudiated each one
of them, a great deal more forcefully than Mr. Mallock does. That such
misrepresentations of Marx should have been permitted to pass
unchallenged in so many of our great colleges and universities is to our
national shame. We will briefly consider the teaching of Marx under each
of the three heads.

First, the source of wealth. It is true that such phrases as "Labor is
the source of all wealth" are constantly met with in the popular
literature of Socialism, but so far as that is the case it is not due to
the teaching of Marx, but rather in spite of it. In the writings of the
early Ricardian Socialists these phrases abound, but nowhere in all the
writings of Marx will such a statement be found. For many years the
opening sentence in the Programme of the German party contained the
phrase "Labor is the source of all wealth and of all culture," _but it
was adopted in spite of the protest of Marx_. The Gotha Programme was
adopted in 1875. A draft was submitted to Marx and he wrote of it that
it was "utterly condemnable and demoralizing to the party." Of the
passage in question, he wrote: "Labor is _not_ the source of all wealth.
Nature is just as much the source of use-values (and of such, to be
sure, is material wealth composed) as is labor, which itself is but the
expression of a natural force, of human labor-power."[158] That the
clause was adopted was a bitter disappointment to Marx, and was due to
the insistence of the followers of Ferdinand Lassalle. To say that Marx
held labor to be the sole source of wealth is to misrepresent his whole

But while the Lassallians, and before them the Ricardians, used the
_phrase_, it is evident that they assumed the inclusion of what Marx
calls "Nature." They know very well that labor, mere exertion of
physical strength, could produce nothing. If, for instance, a man were
to spend all his strength trying to lift the pyramids, alone and unaided
by mechanical power, it is quite evident to the meanest intellect that
his exertions would not produce a single atom of wealth. It is equally
obvious that if we take any use-value, whether it be an exchange-value
or not being immaterial, we cannot eliminate from it the substance of
which it is composed. Take, for example, the canoe of a savage, which is
a simple use-value, and a meerschaum pipe, which is a commodity. In the
canoe we have part of the trunk of a tree taken from the primeval
forest, one of Nature's products. But without the labor of the savage it
would never have become a canoe. It would have remained simply part of
the trunk of a tree, and would not have acquired the use-value it has as
a canoe. But it is likewise true that without the tree the canoe could
not have existed. So with our meerschaum pipe. It is not simply a
use-value: it is also an article of commerce, an exchange-value, a
commodity. Its elements are, the silicate mineral which Nature provided
and the form which human labor has given it. We can apply this test to
every form of wealth, whether simple use-values or commodities, and we
shall find that, in Mill's phrase, wealth is produced by the application
of human labor to _appropriate natural objects_.

This brings us to the second point in Mr. Mallock's criticism, namely,
that Marx held that only "ordinary manual labor" is capable of producing
wealth, and that, therefore, all wealth ought to go to the manual
laborers. One looks in vain for a single passage in all the writings of
Marx which will justify this criticism. It may be conceded at once that
if Marx taught anything of the kind, the defect in Marxian theory is
fatal. But it must be proven that the defect exists--and the _onus
probandi_ rests upon Mr. Mallock. One need not be a trained economist or
a learned philosopher to see how absurd such a theory must be. Suppose
we take, for example, a man working in a factory, at a great machine,
making screws. We go to that man and say: "Every screw here is made by
manual labor alone. The machine does not count; the brains of the
inventors of the machine have nothing to do with the making of screws."
Our laborer might be illiterate and unable to read a single page of
political economy with understanding, but he would know that our
statement was foolish and untrue. Or, suppose we take the machine itself
and say to the laborer: "That great machine with all its levers and
wheels and springs working in such beautiful harmony was made entirely
by manual workers, such as molders, blacksmiths, and machinists; no
brain workers had anything to do with the making of it; the labor of the
inventors, and of the men who drew the plans and supervised the making,
had nothing to do with the production of the machine"--our laborer would
rightly conclude that we were either fools or seeking to mock him as

Curiously enough, notwithstanding the frequent reiteration of this
criticism of Marx by Mr. Mallock, he himself, in an unguarded moment,
provides the answer by which Marx is vindicated! Thus, speaking of the
great classical economists, Adam Smith, Ricardo, and John Stuart Mill,
he points out that they included "all forms of living industrial effort,
from those of a Watt or an Edison down to those of a man who tars a
fence, grouped together under the common name of labor" (Lecture I, page
16). And again: "At present the orthodox economists and the socialistic
economists alike give us _all human effort_[160] tied up, as it were, in
a sack, and ticketed 'human labor'" (Lecture I, page 18). Now, if the
Socialist includes in his definition of labor "all human effort," it
stands to reason that he does not mean only "ordinary manual labor" when
he uses the term. Thus Mallock answers Mallock and vindicates Marx!

Of course, Marx, like all the great economists, includes in his concept
of labor every kind of productive effort, mental as well as physical, as
Mr. Mallock, to the utter destruction of his disingenuous criticism,
unconsciously--we must suppose--admitted. Take, for example, this
definition: "By labor power or capacity for labor is to be understood
the aggregate of those _mental and physical_ capabilities existing in a
human being, which he exercises when he produces a use-value of any
description."[161] As against this luminous and precise definition, it
is but fair to quote that of Mr. Mallock himself. He defines labor as
"the faculties of an individual _applied to his own labor_"[162]--a
meaningless jumble of words. The fifty-seven letters contained in that
sentence would mean just as much if put in a bag, well shaken, and put
on paper just as they happened to fall from the bag.

Marx never argued that the producers of wealth had a _right_ to the
wealth produced. The "right of labor to the whole of its produce" was,
it is true, the keynote of the theories of the Ricardian Socialists. An
echo of the doctrine appeared in the Gotha Programme of the German
Socialists to which reference has already been made, and in the popular
agitation of Socialism in this and other countries it is echoed more or
less frequently. Just in proportion as the ethical argument for
Socialism is advanced, and appeals made to the sense of justice, the
rich idler is condemned and an ethic of distribution based upon
production becomes an important feature of the propaganda. But Marx
nowhere indulges in this kind of argument. Not in a single line of
"Capital," or his minor economic treatises, can any hint of the doctrine
be found. He invariably scoffed at the "ethical distribution" idea. In
the judgment of the present writer, this is at once his great strength
and weakness, but that is beside the point of this discussion. Suffice
it to say, though it involves some reiteration, that Marx never took the
position that Socialism _ought_ to take the place of capitalism,
because the producers of wealth _ought_ to get the whole of the wealth
they produce. His position was rather that Socialism _must_ come, simply
because capitalism _could not_ last.

Finally, we come to the charge that Marx taught that "all productive
effort is absolutely equal in productivity." Incredible as it may seem,
it is nevertheless a fact that everything Marx has to say upon the
subject is directly opposed to this notion, and that, as we shall see
later on, his famous theory of value is not only not dependent upon a
belief in the equal productivity of all productive effort, but would be
completely shattered by it. Not only Marx, but also Mill, Ricardo, and
Smith, his great predecessors, recognized the fact that all labor is not
equally productive. Of course, it requires no special genius to
demonstrate this. That a poor mechanic with antiquated tools will
produce less in a given number of hours than an expert mechanic with
good tools, for example, is too obvious for comment. The Marx assailed
by Mr. Mallock, and numerous critics like him, is a myth. The real Marx
they do not touch--hence the futility of their work. The Marx they
attack is a man of straw, not the immortal thinker. Endowed

     "With just enough of learning to misquote,"

their assaults are vain.


Having thus disposed of some of the more prevalent criticisms of Marx as
an economist, we are ready for a definite, consecutive statement of the
economic theory of modern Socialism. First, however, a word as to the
term "scientific" as commonly applied to Marxian Socialism. Even some of
the friendliest of Socialist critics have contended that the use of the
term is pretentious, bombastic, and altogether unjustified. From a
certain narrow point of view, this appears to be an unimportant matter,
and the vigor with which Socialists defend their use of the term seems
exceedingly foolish, and accountable for only as a result of
enthusiastic fetish worship--the fetish, of course, being Marx.

Such a view is very crude and superficial. It cannot be doubted that the
Socialism represented by Marx and the modern political Socialist
movement is radically different from the earlier Socialism with which
the names of Fourier, Saint-Simon, Cabet, Owen, and a host of other
builders of "cloud palaces for an ideal humanity," are associated. The
need of some word to distinguish between the two is obvious, and the
only question remaining is whether or not the word "scientific" is the
most suitable and accurate one to make that distinction clear; whether
the words "scientific" and "utopian" express with reasonable accuracy
the nature of the difference. Here the followers of Marx feel that they
have an impregnable position. The method of Marx is scientific. From the
first sentence of his great work to the last, the method pursued is that
of a painstaking scientist. It would be just as reasonable to complain
of the use of the word "scientific" in connection with the work of
Darwin and his followers, to distinguish it from the guesswork of
Anaximander, as to cavil at the distinction made between the Socialism
of Marx and Engels and their followers, and that of visionaries like
Owen and Saint-Simon.

Doubtless both Marx and Engels lapsed occasionally into Utopianism. We
see instances of this in the illusions Marx entertained regarding the
Crimean War bringing about the European Social Revolution; in the theory
of the increasing misery of the proletariat; in Engels' confident
prediction, in 1845, that a Socialist revolution was imminent and
inevitable; and in the prediction of both that an economic cataclysm
must create the conditions for a sudden and complete revolution in
society. These, I say, are Utopian ideas, evidences that the founders of
scientific Socialism were tinctured with the older ideas of the
Utopists, and even more with their spirit. But when we speak of
"Marxism," what mental picture does the word suggest, what intellectual
concept is the word a name for? Is it these forecasts and guesses, and
the exact mode of realizing the Socialist ideal which Marx laid down, or
is it the great principle of social evolution determined by economic
development? Is it his naïve and simple description of the process of
capitalist concentration, in which no hint appears of the circuitous
windings that carried the actual process into unforeseen channels, or
the broad fact that the concentration has taken place and that monopoly
has come out of competition? Is it his statement of the extent to which
labor is exploited, or the _fact_ of the exploitation? If we are to
judge Marx by the essential things, rather than by the incidental and
non-essential things, then we must admit his claim to be reckoned with
the great scientific sociologists and economists.

After all, what constitutes scientific method? Is it not the recognition
of the law of causation, putting exact knowledge of facts above
tradition or sentiment; accumulating facts patiently until sufficient
have been gathered to make possible the formulation of generalizations
and laws enabling us to connect the present with the past, and in some
measure to foretell the outcome of the present, as Marx foretold the
culmination of competition in monopoly? Is it not to see past, present,
and future as one whole, a growth, a constant process, so that instead
of vainly fashioning plans for millennial Utopias, we seek in the facts
of to-day the stream of tendencies, and so learn the direction of the
immediate flow of progress? If this is a true concept of scientific
method, and the scientific spirit, then Karl Marx was a scientist, and
modern Socialism is aptly named Scientific Socialism.


[137] An English edition of this work, translated by H. Quelch, was
published in 1900 under the title _The Poverty of Philosophy_.

[138] Cf. F. Engels, Preface to _La Misère de la Philosophie_, English
translation, _The Poverty of Philosophy_, page iv.

[139] _The Right to the Whole Produce of Labour_, by Anton Menger, 1899.

[140] Edward Bernstein, _Ferdinand Lassalle as a Social Reformer_, page

[141] _Criticism of the Gotha Programme_, from the posthumous papers of
Karl Marx.

[142] It should perhaps be pointed out here, to avoid misunderstanding,
that Ricardo hedged this doctrine about with important
qualifications--not always observed by his followers--till it no longer
remained the simple proposition stated above. See Dr. A. C. Whitaker's
_History and Criticism of the Labour Theory of Value in English
Political Economy_, page 57, for a suggestive treatment of this point.

[143] _The Right to the Whole Produce of Labour._

[144] Cf. _Capital_, Vol. I, page 644, and Vol. II, page 19, Kerr

[145] Cf., for instance, _The Wealth of Nations_, Vol. I, Chapter VI.

[146] Introduction to Menger's _The Right to the Whole Produce of

[147] _The Life of Francis Place_, by Graham Wallas, M.A., London, 1898,
page 268.

[148] For this brief sketch of the works of these Ricardian Socialist
writers I have drawn freely upon Menger's _The Right to the Whole
Produce of Labour_, and Professor Foxwell's Introduction thereto.

[149] _Karl Marx: Biographical Memoirs_, by Wilhelm Liebknecht,
translated by E. Untermann, 1901, page 32.

[150] Much of this work has been collated and edited by Marx's daughter,
the late Mrs. Eleanor Marx-Aveling, and her husband, Dr. Edward Aveling,
and published in two volumes, _The Eastern Question_ and _Revolution and

[151] The note is quoted by Liebknecht, _Memoirs of Marx_, page 177, and
in the Introduction to _Revolution and Counter-Revolution_, by the
editor, Eleanor Marx-Aveling.

[152] _Political Economy_, page 115.

[153] Luigi Cossa, _Guide to the Study of Political Economy_, English
translation, 1880.

[154] _The Economic Writings of Sir William Petty_, edited by Charles
Henry Hull, Vol. I, page 244.

[155] The italics are mine.--J. S.

[156] All quotations from Mr. Mallock are taken from the volume
containing the text of his lectures, entitled _Socialism_, published by
The National Civic Federation, New York, 1907.

[157] The italics are mine.--J. S.

[158] _Letter on the Gotha Programme_, by Karl Marx, published in the
collection of the posthumous writings of Marx and Engels, edited by
Mehring, 1902. See a translation of the letter by Dr. Harriet E.
Lothrop, _International Socialist Review_, May, 1908.

[159] I note that my friend, Mr. J. R. Macdonald, M.P., "Whip" of the
Labour Party in the British House of Commons, so misrepresents Marx in
his admirable little book, _Socialism_, page 54.

[160] Italics mine.--J. S.

[161] The italics are mine. The passage occurs on page 186, Vol. I, of
_Capital_, Kerr edition. In the last of the series of lectures printed
in his book, Mr. Mallock attempts a reply to the criticism of an
American Socialist, Mr. Morris Hillquit who quoted this passage from
Marx to show that Mr. Mallock was in error in saying that Marx regarded
manual labor as the sole source of wealth. He evades the real point,
namely, that Marx clearly included mental as well as physical labor in
his use of the term, and with an ingenuity equaled only by the
disingenuousness of the argument, seeks refuge in the fact that it does
not cover the special "directive ability" which is a special function,
"a productive force distinct from labor." The trick will not do. The
fact is that Marx clearly and precisely covers that point in another
place. The reader is referred to Chapter XIII of Part IV, Vol. I, of
_Capital_, pages 363-368, Kerr edition, for a brilliant and honest
treatment of the whole subject of the place of the "directing few" in
modern industry. We shall treat the matter briefly later on.

[162] Italics mine.--J. S. The passage occurs in Lecture III, page 36.




The _geist_ of social and political evolution is economic, according to
the Socialist philosophy. This view of the importance of man's economic
relations involves some very radical changes in the methods and
terminology of political economy. The philosophical view of social and
political evolution as a world-process, through revolutions formed in
the matrices of economic conditions, at once limits and expands the
scope of political economy. It destroys on the one hand the idea of the
eternality of economic laws and limits them to particular epochs. On the
other hand, it enhances the importance of the science of political
economy as a study of the motive force of social evolution. With Marx
and his followers, political economy is more than an analysis of the
production and distribution of wealth; it is a study of the principal
determinant factor in the social and political progress of society,
consciously recognized as such.

The sociological viewpoint appears throughout the whole of Marxian
economic thought. It appears, for instance, in the definition of a
commodity as the unit of wealth _in those societies in which the
capitalist mode of production prevails_. Likewise wealth and capital
connote special social relations or categories. Wealth, which in certain
simpler forms of social organization consists in the ownership of
use-values, under the capitalist system consists in the ownership of
exchange-values. Capital is not a thing, but a social relation between
persons established through the medium of things. Robinson Crusoe's
spade, the Indian's bow and arrow, and all similar illustrations given
by the "orthodox" economists, do not constitute capital any more than an
infant's spoon is capital. They do not serve as the medium of the social
relation between wage-worker and capitalist which characterizes the
capitalist system of production. The essential feature of capitalist
society is the production of wealth in the commodity form; that is to
say, in the form of objects that, instead of being consumed by the
producer, are intended to be exchanged or sold at a profit. Capital,
therefore, is wealth set aside for the production of other wealth with a
view to its exchange at a profit. A house may consist of certain
definite quantities of bricks, timber, lime, iron, and other substances,
but similar quantities of these substances piled up without plan will
not constitute a house. Bricks, timber, lime, and iron become a house
only in certain circumstances, when they bear a given ordered relation
to each other. "A negro is a negro; it is only under certain conditions
that he becomes a slave. A certain machine, for example, is a machine
for spinning cotton; it is only under certain defined conditions that it
becomes capital. Apart from these conditions, it is no more capital than
gold _per se_ is money; capital is a social relation of

This sociological principle pervades the whole of Socialist economics.
It appears in every economic definition, practically, and the
terminology of the orthodox political economists is thereby often given
a new meaning, radically different from that originally given to it and
commonly understood. The student of Socialism who fails to appreciate
this fact will most frequently land in a morass of confusion and
difficulty, but the careful student who fully understands it will find
it of great assistance. Take, as an illustration, the phrase "the
abolition of capital" which frequently occurs in Socialist literature.
The reader who thinks of capital as consisting of _things_, such as
machinery, materials of production, money, and so on, finds the phrase
bewildering. He wonders how it is conceivable that production should go
on if these things were done away with. But the student who fully
understands the sociological principle outlined above comprehends at
once that it is not proposed to do away with the _things_, but with
_certain social relations expressed through them_. He understands that
the "abolition of capital" no more involves the destruction of the
physical things than the abolition of slavery involved the destruction
of the slave himself. What is aimed at is the social relation which is
established through the medium of the things commonly called capital.


In common with all the great economists, Socialists hold that wealth is
produced by human labor applied to appropriate natural objects. This, as
we have seen, does not mean that labor is the sole source of wealth.
Still less does it mean that the mere expenditure of labor upon natural
objects must inevitably result in the production of wealth. If a man
spends his time digging holes in the ground and filling them up again,
or dipping water from the ocean in a bucket and pouring it back again,
the labor so expended upon natural objects would not produce wealth of
any kind. Nor is the productivity of mental labor denied. In the term
"labor" is implied the totality of human energies expended in
production, regardless of whether those energies be physical or mental.
In modern society wealth consists of social use-values, commodities.

We must, therefore, begin our analysis of capitalist society with an
analysis of a commodity. "A commodity," says Marx, "is, in the first
place, an object outside us, a thing that by its properties satisfies
human wants of some sort or another. The nature of such wants, whether,
for instance, they spring from the stomach or from fancy, makes no
difference. Neither are we here concerned to know how the object
satisfies these wants, whether directly as means of subsistence, or
indirectly as means of production."[164] But a commodity must be
something more than an object satisfying human wants. Such objects are
simple use-values, but commodities are something else in addition to
simple use-values. The manna upon which the pilgrim exiles of the Bible
story were fed, for instance, was not a commodity, though it fulfilled
the conditions of this first part of our definition by satisfying human
wants. We must carry our definition further, therefore. In addition to
use-value, then, a commodity must possess exchange-value. In other
words, it must have a social use-value, a use-value to others, and not
merely to the producer.

Thus, things may have the quality of satisfying human wants without
being commodities. To state the matter in the language of the
economists, use-values may, and often do, exist without economic value,
value, that is to say, in exchange. Air, for example, is absolutely
indispensable to life, yet it is not--except in special, abnormal
conditions--subject to sale or exchange. With a use-value that is beyond
computation, it has no exchange-value. Similarly, water is ordinarily
plentiful and has no economic value; it is not a commodity. A seeming
contradiction exists in the case of the water supply of cities where
water for domestic use is commercially supplied, but a moment's
reflection will show that it is not the water, but the social service of
bringing it to a desired location for the consumer's convenience that
represents economic value. Over and above that there is, however, the
element of monopoly-price which enters into the matter. With that we
have not, at this point, anything to do. Under ordinary circumstances,
water, like light, is plentiful; its utility to man is not due to man's
labor, and it has, therefore, no economic value. But in exceptional
circumstances, as in an arid desert or in a besieged fortress, a
millionaire might be willing to give all his wealth for a little water,
thus making the value of what is ordinarily valueless almost infinite.
What may be called natural use-values have no economic value. And even
use-values that are the result of human labor may be equally without
economic value. If I make something to satisfy some want of my own, it
will have no economic value unless it will satisfy the want of some one
else. So, unless a use-value is social, unless the object produced is of
use to some other person than the producer, it will have no value in the
economic sense: it will not be _exchangeable_.

A commodity must therefore possess two fundamental qualities. It must
have a use-value, must satisfy some human want or desire; it must also
have an exchange-value arising from the fact that the use-value
contained in it is social in its nature and exchangeable for other
exchange-values. With the unit of wealth thus defined, the subsequent
study of economics is immensely simplified.[165]

The trade of capitalist societies is the exchange of commodities against
each other, through the medium of money. Commodities utterly unlike each
other in all apparent physical properties, such as color, weight, size,
shape, substance, and so on, and utterly unlike each other in respect to
the purposes for which intended and the nature of the wants they
satisfy, are exchanged for one another, sometimes equally, sometimes in
unequal ratio. The question immediately arises: what is it that
determines the relative value of commodities so exchanged? A dress suit
and a kitchen stove, for example, are very different commodities,
possessing no outward semblance to each other, and satisfying very
different human wants, yet they may, and actually do, exchange upon an
equality in the market. To understand the reason for this similarity of
value of dissimilar commodities, and the principle which governs the
exchange of commodities in general, is to understand an important part
of the mechanism of modern capitalist society.

This is the problem of value which all the great economists have tried
to solve. Sir William Petty, Adam Smith, David Ricardo, John Stuart
Mill, and Karl Marx developed what is known as the labor-value theory as
the solution of the problem. This theory, as developed by Marx, not in
its cruder forms, is one of the cardinal principles in Socialist
economic theory. The Ricardian statement of the theory is that the
relative value of commodities to one another is determined by the
relative amounts of human labor embodied in them; that the quantity of
labor embodied in them is the determinant of the value of all
commodities. When all their differences have been carefully noted, all
commodities have at least one quality in common. The dress suit and the
kitchen range, toothpicks and snowshoes, pink parasols and
sewing-machines, are unlike each other in every other particular save
one--they are all products of human labor, crystallizations of human
labor-power. Here, then, say the Socialists, as did the great classical
economists, we have a hint of the secret of the mechanism of exchange in
capitalist society. The amount of labor-power embodied in their
production is in some way connected with the measure of the exchangeable
value of the commodities.

Stated in the simple, crude form, that the quantity of human labor
crystallized in them is the basis and measure of the value of
commodities when exchanged against one another, the labor theory of
value is beautifully simple. At least, the formula is simplicity itself.
At the same time, it is open to certain very obvious criticisms. It
would be absurd to contend that the day's labor of a coolie laborer is
equal in productivity to the day's labor of a highly skilled mechanic,
or that the day's labor of an incompetent workman is of equal value to
that of the most proficient. To refute such a theory is as beautifully
simple as the theory itself. In all seriousness, arguments such as these
are constantly used against the Marxian theory of value, notwithstanding
that they do not possess the slightest relation to it. Marxism is very
frequently "refuted" by those who do not trouble themselves to
understand it.

The idea that the quantity of labor embodied in them is the determinant
of the value of commodities was held by practically all the great
economists. Sir William Petty, for example, in a celebrated passage,
says of the exchange-value of corn: "If a man can bring to London an
ounce of silver out of the earth in Peru in the same time that he can
produce a bushel of corn, then one is the natural price of the other;
now, if by reason of new and more easy mines a man can get two ounces of
silver as easily as formerly he did one, then the corn will be as cheap
at ten shillings a bushel as it was before at five shillings a bushel,
_cæteris paribus_."[166]

Adam Smith, following Petty's lead, says: "The real price of everything,
what everything really costs to the man who wants to acquire it, is the
toil and trouble of acquiring it. What everything is really worth to the
man who has acquired it, and who wants to dispose of it or exchange it
for something else, is the toil and labor which it can save to himself,
and which it can impose on other people.... Labor was the first price,
the original purchase money, that was paid for all things.... If among a
nation of hunters, for example, it usually costs twice the labor to kill
a beaver which it does to kill a deer, one beaver would naturally be
worth or exchange for two deer. It is natural that what is usually the
produce of two days' or two hours' labor, should be worth double of what
is usually the produce of one day's or one hour's labor."[167]

Benjamin Franklin, whose merit as an economist Marx recognized, takes
the same view and regards trade as being "nothing but the exchange of
labor for labor, the value of all things being most justly measured by
labor."[168] From the writings of almost every one of the great
classical economists of England it would be easy to compile a formidable
and convincing volume of similar quotations, showing that they all took
the same view that the quantity of human labor embodied in commodities
determines their value. One further quotation, from Ricardo, must,
however, suffice. He says:--

"To convince ourselves that this (quantity of labor) is the real
foundation of exchangeable value, let us suppose any improvement to be
made in the means of abridging labor in any one of the various processes
through which the raw cotton must pass before the manufactured stockings
come to the market to be exchanged for other things; and observe the
effects which will follow. If fewer men were required to cultivate the
raw cotton, or if fewer sailors were employed in navigating, or
shipwrights in constructing, the ship in which it was conveyed to us; if
fewer hands were employed in raising the buildings and machinery, or if
these, when raised, were rendered more efficient; the stockings would
inevitably fall in value, and command less of other things. They would
fall because a less quantity of labor was necessary to their production,
and would therefore exchange for a smaller quantity of those things in
which no such abridgment of labor had been made."[169]

It is evident from the foregoing quotations that these great writers
regarded the quantity of human labor crystallized in them as the basis
of all commodity values, and their real measure. The great merit of
Ricardo lies in his development of the idea of social labor as against
the simple concept of the labor of particular individuals, or sets of
individuals. In the passage cited, he includes in the term "quantity of
human labor" not merely the total labor of those immediately concerned
in the making of stockings, from the cultivation of the raw cotton to
the actual making of stockings in the factory, but all the labor
indirectly expended, even in the making and navigating of ships, and the
building of the factories. One does, indeed, find hints of the social
labor concept in Adam Smith, but it is Ricardo who first clearly
develops it. Marx further developed this principle, and all criticisms
of the labor-value theory in Marxian economic theory which are based
upon the assumption that quantity of labor means the simple, direct
labor embodied in commodities fall of their own weight.

Thus, if we take any commodity, we shall find that it is possible to
ascertain with tolerable certainty the amount of direct labor embodied
in it, but that it is equally as impossible to ascertain the amount of
the indirect expenditure of labor power which entered into its making.
In the case of a table, for example, it may be possible to trace with
some approximation to accuracy the labor involved in felling the tree
and preparing the lumber out of which the table was made; the labor
directly spent in bringing the lumber to the factory, and the direct
labor expended in making out of the lumber a finished table; allowance
may also be made for the labor embodied in the nails, glue, stain, and
other articles used in making the table. So we have a fairly accurate
statement of the direct labor embodied in the table. But what of the
labor used to make the tools of the men who felled the trees and
prepared the lumber? What of the coal miner and the iron miner and the
tool maker? And what of the numerous and incalculable expenditures of
labor to make the railroads, the railway engines, and to provide these
with steam-power? What, also, of the machinery in the factory, and of
the factory buildings themselves, and, back of them, again, the tool
makers and the providers of raw materials? It is obvious that no human
intellect could ever unravel the tangled skein of human labor, and that
in actual exchange there can be no calculation of the respective labor
content of commodities. If the law of value holds good, it must operate
mechanically, automatically. And this it does, through the incidence of
bargaining and the law of supply and demand.

We have noted elsewhere the variations in human capacity and
productiveness. Superficial critics still frequently charge Marx with
having overlooked this very obvious fact, whereas it has not only been
fully treated by him, but was actually covered by Smith and Ricardo
before Marx! With these writers and their followers it is the law of
averages which solves the difficulties arising from variations in
individual capacity and productivity. It is the _average_ amount of
labor expended in killing the beaver which counts, not the actual
individual labor in a specified case. Nor did these writers overlook the
important differentiation between simple, unskilled labor and labor that
is highly skilled. If A in ten hours' labor produces exactly double the
amount of exchange-value which B produces in the same time devoted to
labor of another kind, it is obvious that the labor of B is not equal in
value to that of A. Quantity of labor cannot, therefore, be measured, in
individual cases, by time units. Despite a hundred passages which,
detached from their context, seem to imply the contrary, Adam Smith
recognized this very clearly, and attempted to solve the riddle by a
differentiation of skilled and unskilled labor in which he likens
skilled labor to a machine; and insists that the labor and time spent in
acquiring the skill which distinguishes skilled labor must be

Another frequent criticism of the Marxian theory has not only been
answered by Marx himself--is, in fact, ruled out by the terms of the
theory itself--but was amply replied to by Ricardo.[171] The criticism
in question consists in the selection of what may be called "unique
values," or scarcity values, articles which cannot be reproduced by
labor, and whose value is wholly independent of the quantity of labor
originally necessary to produce them. Such articles are unique specimens
of coins and postage stamps, autograph letters, rare manuscripts,
Stradivarius violins, Raphael pictures, Caxton books, articles
associated with great personages--such as Napoleon's snuffbox--great
auks' eggs, and so on _ad infinitum_. No possible amount of human labor
could reproduce these articles, reproduce, that is to say, the exact
utilities in them. Napoleon's snuffbox might be exactly duplicated so
far as its physical properties are concerned, but the association with
Napoleon's fingers, the sentimental quality which gives it its special
utility, is not reproducible. But the trade of capitalist society does
not consist in the manufacture and sale of these things, which, after
all, form a very insignificant part of the exchange-values of the world.


Marx saw the soul of truth in the labor-value theory, as propounded by
his predecessors, especially Ricardo, and devoted himself to its
development and systematization. He has been accused of plagiarizing his
theory from the Ricardians, but it is surely not plagiarism when a
thinker sees the germ of truth in a theory, and, separating it from the
mass of confusion and error which envelops it, restates it in scientific
fashion with all its necessary qualifications. This is precisely what
Marx did. He developed the idea of social labor which Ricardo had
propounded, disregarding entirely individual labor. He recognized the
absurdity of the contention that the value of commodities is determined
by the amount of labor, either individual or social, _actually embodied
in them_. If two workers are producing precisely similar commodities,
say coats, and one of them expends twice as much labor as the other and
uses tools and methods representing twice the social labor, it is
clearly foolish to suppose that the exchange-value of his coat will be
twice as great as that of the other worker, regardless of the fact that
their utility is equal. Labor, Marx pointed out, has two sides, the
qualitative and the quantitative. The qualitative side, the difference
in quality between specially skilled and simply unskilled labor, is
easily recognized, though the relative value of the one compared with
the other may be somewhat obscured. The secret of that obscurity lies
hidden in the quantitative side of labor. Here we must enter upon an
abstract inquiry, that part of the Marxian theory which is most
difficult to comprehend. Yet, it is not so very difficult, after all, to
understand that the years devoted to learning his trade, by a mechanical
engineer, for instance, during all of which years he must be provided
with the necessities of life, must be reckoned somewhere and somehow;
and that when they are so reckoned, his day's labor may be found to
contain, concentrated, so to speak, an amount of labor time equivalent
to two or even many days' simple unskilled labor time. It may be, and in
fact is, quite impossible to set forth mathematically the relation of
the two, for the reason that the process of developing skilled labor is
too complex to be unraveled. Of the fact, however, there can be no

The real law of value, then, according to Marx, is as follows: Under
capitalism, _in free competition_, the value of all commodities, other
than those unique things which cannot be reproduced by human labor, is
determined by the amount of _abstract_ labor embodied in them; or,
better, by the amount of social human labor power necessary, on the
average, for their production. We may conveniently illustrate this
theory by a concrete example. Let us, therefore, return to our
coat-makers. Now, always assuming their equal utility, no one will be
willing to pay twice as much for the coat produced by the slow worker
with poor tools as for the other. If the more economical methods of
production employed by the man who makes his coats in half the time
taken by the other man are the methods usually employed in the
manufacture of coats, and the time he takes represents the average time
taken to produce a coat, then the average value of coats will be
determined thereby, and coats produced by the slower, less economical
process will command only the same price in the market, the fact that
they may embody twice the amount of actual labor counting for nothing.
If we reverse the order of this proposition, and suppose the slower,
less economical methods to be those generally prevailing in the
manufacture of coats, and the quicker, more economical methods to be
exceptional, then, all other things being equal, the exchange-value, of
coats will be determined by the amount of labor commonly consumed, and
the fortunate producer who adopts the exceptional, economical methods
will, for a time, reap a golden harvest. Only for a time, however. As
the new methods prevail, competition being the impelling force, they
become less and less exceptional, and, finally, the regular, normal
methods of production and the standard of value.

It is this very important qualification, fundamental to the Marxian
theory, which is most often lost sight of by the critics. They persist
in applying to individual commodities the test of comparing the amounts
of labor-power actually consumed in their production, and so confound
the Marxian theory with its crude progenitors. In refuting this crude
theory, they are quite oblivious of the fact that Marx himself
accomplished that by no means difficult feat. To state the Marxian
theory accurately, we must qualify the bald statement that the
exchange-value of commodities is determined by the amount of labor
embodied in them, and state it in the following manner: _The
exchange-value of commodities is determined by the amount of average
labor at the time socially necessary for their production._ This is
determined, not absolutely in individual cases, but approximately in
general, by the bargaining and higgling of the market, to adopt Adam
Smith's well-known phrase.

Now, this theory applies to those things, exclusive of the category of
"unique values," which cannot be made by labor and are commonly supposed
to owe their value to their rarity. For example, we may take diamonds. A
man walking along the great wastes of the African _karoo_ comes across a
little stream. As he stoops to drink, he sees in the water a number of
glittering diamonds. To pick them out is the work of a few minutes only,
but the diamonds are worth many thousands of dollars. The law of value
above outlined applies just as much to them as to any other commodity.
The value of diamonds is determined by the amount of labor expenditure
necessary _on an average_ to procure them. If the normal method of
obtaining diamonds were simply to go to the nearest stream and pick them
out, their value would fall, possibly to zero:--

     "When we have nothing else to wear
     But cloth of gold and satins rare,
     For cloth of gold we cease to care--
       Up goes the price of shoddy."


Most writers do not distinguish between price and value with sufficient
clearness, using the terms as if they were synonymous and
interchangeable. Where utilities are exchanged directly one for
another, as in the barter of primitive society, there is no need of a
price-form to express value. In highly developed societies, however,
where the very magnitude of production and exchange makes direct barter
impossible, and where the objects to be exchanged are not commonly the
product of individual labor, a medium of exchange becomes necessary; a
something which is generally recognized as a safe and stable commodity
which can be used to express in terms of its own weight, size, shape, or
color, the value of other commodities to be exchanged. This is the
function of money. In various times and places wheat, shells, skins of
animals, beads, powder, tobacco, and a multitude of other things, have
served as money, but for various reasons, more or less obvious, the
precious metals, gold and silver, have been most favored.

In all commercial countries to-day, one or other of these metals, or
both of them, serves as the recognized medium of exchange. They are
commodities also, and when we say that the value of a commodity is a
certain amount of gold, we equally express the value of that amount of
gold in terms of the commodity in question. As commodities, the precious
metals are subject to the same laws as other commodities. If gold should
be discovered in such abundance that it became as plentiful and easy to
obtain as coal, its value would be no greater than that of coal. It
might, conceivably, still be used as the medium of exchange, but it
would--unless protected by legislation or otherwise from the operation
of economic law, and so given a monopoly-price--have an exchange-value
equal to that of coal, a ton of the one being equal to a ton of the
other--provided, of course, that its utility remained. Since the
scarcity of gold is an important element in its utility valuation,
creating and fostering the desire for its possession, that utility-value
might largely disappear if gold became as plentiful as coal, in which
case it would not have the same value as coal, and might cease to be a
commodity at all.

Price, then, is the expression of value in terms of some other
commodity, which, generally used for that purpose of expressing the
value of other commodities, we call money. It is only an approximation
of value, and subject to a much greater fluctuation than value itself.
It may, for a time, fall far below or rise above value, but in a free
market--the only condition in which the operation of the law may be
judged--sooner or later the equilibrium will be regained. Where monopoly
exists, the free market condition being non-existent, price may be
constantly elevated above value. Monopoly-price is an artificial
elevation of price above value, and must be considered separately as the
abrogation of the law of value.

Failure to discriminate between value and its price-expression, or
symbol, has led to endless difficulty. It lies at the bottom of the
naïve theory that value depends upon the relation of supply and demand.
Lord Lauderdale's famous theory has found much support among later
economists, though it is now rather unpopular when stated in its old,
simple form. Disguised in the so-called Austrian theory of final
utility, it has attained considerable vogue.[172] The theory is
plausible and convincing to the ordinary mind. Every day we see
illustrations of its working: prices are depressed when there is an
oversupply, and elevated when the demand of would-be consumers exceeds
the supply of the commodities they desire to buy. It is not so easy to
see that these effects are temporary, and that there is an automatic
adjustment going on. Increased demand raises prices for a while, but it
also calls forth an increase in supply which tends to restore the old
price level, or may even force prices below it. In the latter case, the
supply falls off and prices find their real level. The relation of
supply to demand causes an oscillation of prices, but it is not the
determinant of value. When prices rise above a certain level, demand
slackens or ceases, and prices are inevitably lowered. Prices may and do
fall with a decreased demand, but it is clear that unless the producers
can get a price approximately equal to the value of their commodities,
they will cease to produce them, and the supply will diminish or cease
altogether. Ultimately, therefore, the fluctuations of price through the
lack of equilibrium between supply and demand adjust themselves, and
prices must tend constantly to approximate values.

Monopoly-price is, as already observed, an artificial price in the sense
that the laws of free market exchange do not apply to it. The "unique
utilities," things not reproducible by human labor, command what might
be termed natural monopoly-prices. There are many other commodities,
however, the price of which is not regulated by the quantity of social
human labor necessary to produce them, but simply by the desire of the
purchasers and the means they have of gratifying it and the power of the
sellers to control the market and exclude effective competition. Since
Karl Marx wrote, the exceptions to his law of value have become more
numerous, as a result of the changes in industrial and commercial
conditions. The development of great monopolies and near-monopolies has
greatly increased the number of commodities which, for considerable
periods, are placed outside the sphere of the labor-value theory, their
price depending upon their marginal utility, irrespective of the labor
actually embodied in them or necessary to their reproduction. It may, in
the opinion of the present writer, be said in criticism of the followers
of Marx that they have not carried on his work, but largely contented
themselves with repeating generalizations which, true when made, no
longer fit all the facts. But that is not a criticism of Marx, or of his
work. What he professed to make was an analysis of the methods of
production and exchange in competitive capitalist society. His followers
have largely failed to allow for the enormous changes which have taken
place, and go on repeating, unchanged, his phrases.

Professor Seligman has pointed out that Ricardo's contention that value
is determined by the cost of production, and the contention of Jevons
that value is determined by marginal utility, are not mutually
exclusive, but, on the contrary, complementary to each other.[173] The
present writer has long contended that the marginal utility theory and
the Marxian labor-value theory are likewise not antagonistic but
complementary.[174] This is not the place to enter into the elaborate
discussion which this contention involves. Only a brief indication of
the argument for the claim is here and now possible. First, as we have
seen, Marx is very careful to insist that utility is essential to value,
and that the utility must be a social utility. But social utility does
not come of itself, from the skies or elsewhere. It is, so far as the
vast majority of commodities is concerned, the product of labor. It is
true that the value of a thing is never independent of its social
utility; it is likewise true that this is determined by the social labor
necessary to the reproduction of that utility. To regard the two
theories as antagonistic, it seems to be necessary to say either (1)
that the quantity of social labor necessary to produce certain
commodities determines their value, utterly regardless of the amount of
their social utility, or (2) that we estimate the social utility of
commodities, estimate what we are willing to pay for them, utterly
regardless of the labor necessary, on an average, for their
reproduction. The latter contention would be absurd, and the former
would involve the abandonment of the initial premises of the Marxian
theory, contained in his definition of a commodity. In so far as the
basis of social utility is the social labor necessary for its
production, the labor-value theory of Marx may be said, I think, to
include the marginal utility law, as one of the forms in which it


Labor, the source and determinant of value, has, _per se_, no value.
Only when it is embodied in certain forms has it any value. If a man
labors hard digging holes and refilling them, his labor has no value.
What the capitalist buys is not labor, but labor-power. Wages in general
is a form of payment for a given amount of labor-power, measured by
duration and skill. The laborer sells brain and muscle power, which is
thus placed at the temporary disposal of the capitalist to be used up
like any other commodity that he buys. The philosopher Hobbes, in his
"Leviathan," clearly anticipated Marx in thus distinguishing between
labor and laboring power in the saying, "_The value or worth of a man is
... so much as would be given for the Use of his Power_." The power to
labor assumes the commodity form, being at once a use-value and an
exchange-value. At first sight it appears that piecework is an exception
to the general rule that the capitalist buys labor-power and not labor
itself. It seems that when piece-wages are paid it is not the machine,
the living labor-power, but the product of the machine, labor actually
performed, that is bought. Superficially, this is so, of course, but it
does not affect the principle laid down, because, as a matter of fact,
the piecework system is only one of the means used to secure a maximum
of labor-power. The average output of pieceworkers in a trade always
tends to become the standard output for the time-workers, and, on the
other hand, the average wage of pieceworkers tends to keep very near the
standard of time-wages.

Now, as a commodity, labor-power is subject to the same laws as all
other commodities. Its price, wages, fluctuates just as the price of all
other commodities does, and bears the same relation to its value. It may
be temporarily affected by the preponderance of supply over demand, or
of demand over supply; it may be made the subject of monopoly in certain
cases. There is, therefore, no such thing as an "iron law" of wages, any
more than there is an "iron law" of prices for other commodities.
Lassalle took the Ricardian law of wages and, by means of his
characteristic exaggeration, distorted it out of all semblance to truth.
Says Ricardo: "The natural price of labor, therefore, depends on the
price of the food, necessaries, and conveniences required for the
support of the laborer and his family. With a rise in the price of food
and necessaries, the natural price of labor will rise; with the fall in
their price, the natural price of labor will fall."[175] This Lassalle
made the basis of his famous "iron law," according to which 96 per cent
of the wage-workers were precluded from improving their economic
position. Lassalle's chief fault lay in that he made no allowance
whatever for either state interference, or the organized influence of
the workers themselves. He also attaches too little importance to what
Marx calls the traditional standards of living.[176] It is nevertheless
true that the price of labor-power, wages, tends to approximate its
value, just as the price of all other commodities tends, under normal
conditions, to approximate their value.

And just as the value of other commodities is determined by the amount
of social labor necessary on an average for their reproduction, so the
value of labor-power is likewise determined. Wages tend to a point at
which they will cover the average cost of the necessary means of
subsistence for the workers and their families, in any given time and
place, under the conditions and according to the standards of living
generally prevailing. Trade union action, for example, may force wages
above that point, or undue stress in the competitive labor market may
force wages below it. While, however, a trade union may bring about what
is virtually a monopoly-price for the labor-power of its members, there
is always a counter tendency in the other direction, sometimes even to
the lowering of the standard of subsistence itself to the minimum of
things required for physical existence.

To class human labor-power with pig iron as a commodity, subject to the
same laws, may at first seem fantastic to the reader, but a careful
survey of the facts will fully justify the classification. The capacity
of the worker to labor depends upon his securing certain things; his
labor-power has to be reproduced from day to day, for which a certain
supply of food, clothing, and other necessities of life is essential.
Even with these supplied constantly, the worker sooner or later wears
out and dies. If the race is not to be extinguished, a certain supply of
the necessities of life must be provided for the children during the
years of their development to the point where their labor-power becomes
marketable. The average cost of production in the case of labor-power
includes, therefore, the necessities for a wife and family as well as
for the individual worker. Far from being the iron law Lassalle
imagined, this law of wages is one of considerable elasticity. The
standard of living itself, far from being a fixed thing, determined only
by the necessities of physical existence, varies according to
occupational groups; to localities sometimes, as a result of historical
development; to nationality and race, as a result of tradition; to the
general standard of intelligence, and the degree in which the workers
are organized for the promotion of their economic interests. The advance
in the culture of the people as a whole, expressing itself in
legislation for compulsory education, the abolition of child labor,
improvement of housing and general sanitary conditions, and so on,
tends to raise the standard of living. Finally, the fluctuations in the
price of labor-power due to the operation of the law of supply and
demand are much more important than Lassalle imagined.

This living commodity, labor-power, differs in one remarkable way from
all other commodities, in that when it is used up in the process of the
production of other commodities in which it is embodied, it creates new
value in the process of being used up, and embodies that new value in
the commodity it assists to produce. In the case of raw materials and
machinery this is not so. In the manufacture of tables, for example, the
wood used up is transformed into tables, embodied in them, but the wood
has added nothing to its own value. The same is true of machinery. But
with human labor-power it is otherwise. The capitalist buys from the
laborer his labor-power at its full value as a commodity. But the
laborer, in embodying that labor-power in some concrete form, creates
more value than his wages represents. For the commodity he sells, his
_power_ to labor, he has been paid its full value, namely, the social
labor-cost of its production; but that power may be capable of producing
the equivalent of twice its own cost of production. This is the central
idea of the famous and much-misunderstood Marxian theory of
surplus-value, by which the method of capitalism, the exploitation of
the wage-workers, and the resulting class antagonisms of the system are
explained. This theory becomes the groundwork of all the social theories
and movements protesting against and seeking to end the exploitation of
the laboring masses. To understand it is, therefore, of paramount


As we have seen in an earlier chapter, Marx was not the first to
recognize that the secret of capitalism, the object of capitalist
industry, is the extraction of surplus-value from the labor-power of the
worker. Nor was he the first to use the term. By no means a happy term,
since it adds to the difficulty of comprehending the meaning and nature
of _value_, Marx took it from the current economic discussion of his
time as a term already fairly well understood. What we owe to the genius
of Marx is an explanation of the manner in which surplus-value is
extracted by the capitalist from the labor-power of the worker, and the
part it plays in capitalist society.

The essence of the theory can be very briefly stated, but its
demonstration involves, naturally, a more extensive study. Under normal
conditions, the worker will produce a value equivalent to his means of
subsistence, or to the wages actually paid to him, in a very small
number of hours. If he owned and controlled the means of
production,--land, machinery, raw materials, and so on,--he would,
therefore, need to work only so many hours as the production of the
necessities of life for himself and his family required. But the laborer
in capitalist society does not own the means of production, that
condition being quite incompatible with machine production upon a large
scale. A separation of the worker from the ownership of the means of
production has taken place as one of the inevitable results of
industrial evolution. So the laborer must sell the only commodity he has
to sell, namely, his labor-power. He sells the utility of that commodity
to the capitalist for its exchange-value, or market price. Like any
other commodity, the utility of labor-power, its use-value, belongs to
the purchaser, the capitalist. It is his to use as he sees fit. He has
it used to produce other commodities which he in turn hopes to sell--has
the labor-power used up in the manufacture of other commodities, just as
he has the raw materials used up. He buys, for example, the labor-power
of the workers for a day of ten hours. In five hours, say, the worker
creates value equivalent to his wages, but he does not cease at that
point. He goes on working for another five hours, thus producing in a
day double the amount of his wages, the exchange-value of the
labor-power he sold the capitalist. Thus the capitalist, having paid
wages equivalent to the product of five hours, receives the product of
ten hours. This balance represents the surplus-value (_Mehrwerth_).

This takes place all through industry. If the capitalist employs a
thousand workers under these conditions, each day he receives the
product of five thousand hours over and above the product actually paid
for. This constitutes his income. If the capitalist owned the land,
machinery, and raw materials, absolutely, without incumbrances of any
kind, the whole of that surplus-value would, naturally, belong to him.
But as a general rule this is not the case. He rents the land and must
pay rent to the landlord, or he works upon borrowed capital and must pay
interest upon loans, so that the surplus-value extracted from the
laborer must be divided into rent, interest, and profit. But how the
surplus-value is divided among landlords, moneylenders, creditors,
speculators, and actual employers is a matter of absolutely no moment to
the workers as a class. That is why such movements as that represented
by the followers of Henry George fail to vitally interest the working
class.[177] The division of the surplus-value wrung from the toil of the
workers gives rise to much quarrel and strife within the ranks of the
exploiting class, but the working class recognizes, and vaguely and
instinctively feels where it does not clearly recognize, that it has no
interest in these quarrels. All that interests it vitally is how to
lessen the extent of the exploitation to which it is subjected, and how
ultimately to end that exploitation altogether. That is the objective of
the movement for the socialization of the means of life.

Such, briefly stated, is the theory. We may illustrate it by the
following example: Let us say the average cost of a day's subsistence is
the product of five hours' social labor, which is represented by a wage
of $1 per day. In a factory there are 1000 workers. Their labor-power
they have sold at its exchange value, $1 per day per man, a total of
$1000. They use up $1000 worth of labor-power, then. They also use up
$1000 worth of raw material and wear out the plant to the extent of $100
in the course of their work. Now, instead of working five hours each,
that being the amount of time necessary to reproduce the value of their
wages, as above described, they all work ten hours. Thus, in place of
the $1000 they received as wages for the labor-_power_ they sold, they
create labor _products_, valued at just twice that sum, $2000. According
to our suppositions, therefore, the gross value of the day's product
will be $3100, the whole of it belonging to the capitalist, for the
simple and sufficient reason that he bought and paid for, at their full
value as commodities, all the elements entering into its production, the
machinery, materials, and labor-power. The capitalist pays,--

     For labor-power                           $1000
     For materials                              1000
     For repairs and replacement of machinery    100
     He receives, for the gross product         3100    $2100
     The surplus-value is, therefore            1000

and this sum is the fund from which rent, interests, and profits must be

It will be observed that there is no moral condemnation of the
capitalist involved in this illustration. He simply buys the commodity,
labor-power, at its full market price, as in the case of all other
commodities. No ethical argument enters into it at all. It is very
evident, however, that the interest of the capitalist will be to get as
much surplus-value as possible, by buying labor-power at the lowest
price possible, prolonging the working day, and intensifying the
productivity of the labor-power he buys, while the interest of the
workman will be equally against these things. Here we have the cause of
class antagonism--not in the speeches of agitators, but in the facts of
industrial life.

This is the Marxian theory of surplus-value in a nutshell. Rent,
interest, and profit, the three great divisions of capitalist income
into which this surplus-value is divided, are thus traced to the
exploitation of labor, resting fundamentally upon the ownership by the
exploiting class of the means of production. Other economists, both
before and since Marx, have tried to explain the source of capitalist
income in very different ways. An early theory was that profit
originates in exchange, through "buying cheap and selling dear." That
this is so in the case of individual traders is obvious. If A sells to B
commodities above their value, or buys commodities from him below their
value, it is plain that he gains by it. But it is equally plain that B
loses. If one group of capitalists gains what another group loses, the
gains and losses balance each other; there is no gain to the capitalist
class as a whole. Yet that is precisely what occurs--the capitalist
class as a whole does gain, and gain enormously, despite the losses of
individual members of that class. It is that gain to the great body of
capitalists, that general increase in their wealth, which must be
accounted for, and which exchange cannot explain. Only when we think of
the capitalist class buying labor-power from outside its own ranks,
generally at its natural value, and using it, is the problem solved. The
commodity which the capitalist buys creates a value greater than its own
in being used up.

The theory that profit is the wages of risk is answerable in
substantially the same way. It does not in any way explain the increase
in the aggregate wealth of the capitalist class to say that the
individual capitalist must have a chance to receive interest upon his
money in order to induce him to turn it into capital, to hazard losing
it wholly or in part. While the theory of risk helps to explain some
features of capitalism, the changes in the flow of capital into certain
forms of investment, and, to some small extent, the commercial crises
incidental thereto, it does not explain the vital problem, the source of
capitalist income. The chances of gain, as a premium for the risks
involved, explain satisfactorily enough the action of the gambler when
he enters into a game of roulette or faro. It cannot be said, however,
that the aggregate wealth of the gamblers is increased by playing
roulette or faro. Then, too, the risks of the laborers are vastly more
vital than those of the capitalist. Yet the premium for their risks of
health and life itself does not appear, unless, indeed, it be in their
wages, in which case the most superficial glance at our industrial
statistics will show that wages are by no means highest in those
occupations where the risks are greatest and most numerous. Further, the
wages of the risks for capitalists and laborers alike are drawn from the
same source, the product of the laborers' toil.

To consider, even briefly, all the varied theories of surplus-value
other than these would be a prolonged, dull, and profitless task. The
theory of abstinence, that profit is the just reward of the capitalist
for saving part of his wealth and using it as a means of production, is
answerable by _a priori_ arguments and by a vast volume of facts.
Abstinence obviously produces nothing; it can only save the wealth
already produced by labor, and no automatic increase of that saved-up
wealth is possible. If it is to increase without the labor of its owner,
it can only be through the exploitation of the labor of others, so that
the abstinence theory in no manner controverts the Marxian position. On
the other hand, we see that those whose wealth increases most rapidly
are not given to frugality or abstinence by any means. It may,
certainly, be possible for an individual to save enough by practicing
frugality and abstinence to enable him to invest in some profitable
enterprise, but the source of his profit is not his abstinence. That
must be sought elsewhere. Abstinence may provide him with the means for
taking the profit, but the profit itself must come from the value
created by human labor-power over and above its cost of production.

Still less satisfactory is the idea that surplus-value is nothing more
than the "wages of superintendence," or the "rent of ability." This
theory has been advocated with much specious argument. Essentially it
involves the contention that there is no distinction between wages and
profits, or between capitalists and laborers; that the capitalist is a
worker, and his profits simply wages for his useful and highly important
work of directing industry. It is a bold theory with a very small basis
of fact. Whoever honestly considers it, must, one would think, see that
it is both absurd and untrue. Not only is the larger part of industry
to-day managed by salaried employees who have no part, or only a very
insignificant part, in the ownership of the concerns they manage, but
the profits are distributed among shareholders who, as shareholders,
have never contributed service of any kind to the industries in which
they are shareholders. Whatever services are performed, even by the
figure-head "dummy" directors of companies, are paid for before profits
are considered at all. This is the invincible answer to such criticisms
as that of Mr. Mallock, that Marx and his followers have not recognized
"the functions of the directive ability of the few." When all the
salaries of the directing "few" have been paid, as well as the wages of
the many, and the cost of all materials and maintenance of machinery,
there remains a surplus to be distributed among those who belong neither
to the "laboring many" nor the "directing few." That profit Mr. Mallock
cannot explain away. Marx himself, in "Capital," called attention to the
"directing ability of the few," quite as clearly as Mr. Mallock has
done. He first shows how the "collective power of masses" is really a
new creation; that it involves a special kind of leadership, or
directing authority, just as an orchestra does; then he proceeds to
point out the development of a special class of supervisors and
directors of industry, "a special kind of wage laborer.... The _work of
supervision becomes their established and exclusive function_."[178]
Socialists, contrary to Mr. Mallock, have not overlooked the function
exercised by the directing few, but they have pointed out that when
these have been paid, their salaries being sometimes almost fabulous,
there is still a surplus-value to be distributed among those who have
not shared in the production, either as mental or manual workers. As Mr.
Algernon Lee says:--

"The profits produced in many American mills, factories, mines, and
railway systems go in part to Englishmen or Belgians or Germans who
never set foot in America, and who obviously can have no share in even
the mental labor of direction. A certificate of stock may belong to a
child, to a maniac, to an imbecile, to a prisoner behind the bars, and
it draws profit for its owner just the same. Stocks and bonds may lie
for months or years in a safe-deposit vault, while an estate is being
disputed, before their ownership is determined; but whoever is declared
to be the owner gets the dividends and interest "earned" during all that

It is an easy task to set up imaginary figures labeled "Marxism," and
then to demolish them by learned argument--but the occupation is as
fruitless as it is easy. It remains the one central fact of capitalism,
however, that a surplus-value is created by the working class and taken
by the exploiting class, from which develops the class struggle of our


[163] _The People's Marx_, by Gabriel Deville, page 288.

[164] _Capital_, Vol. I, Kerr edition, page 41.

[165] Professor J. S. Nicholson, a rather pretentious critic of Marx,
has called sunshine a commodity because of its utility, _Elements of
Political Economy_, page 24. Upon the same ground, the song of the
skylark and the sound of ocean waves might be called commodities. Such
use of language serves for nothing but the obscuring of thought.

[166] William Petty, _A Treatise on Taxes and Constitutions_ (1662),
pages 31-32.

[167] _The Wealth of Nations_, Vol. I, Chapters V-VI.

[168] Benjamin Franklin, _Remarks and Facts Relative to the American
Paper Money_ (1764), page 267.

Marx thus speaks of Franklin as an economist: "The first sensible
analysis of exchange-value as labor-time, made so clear as to seem
almost commonplace, is to be found in the work of a man of the New
World, where the bourgeois relations of production, imported together
with their representatives, sprouted rapidly in a soil which made up its
lack of historical traditions with a surplus of _humus_. That man was
Benjamin Franklin, who formulated the fundamental law of modern
political economy in his first work, which he wrote when a mere youth
(_A Modest Inquiry into the Nature and Necessity of a Paper Currency_),
and published in 1721." _A Contribution to the Critique of Political
Economy_, by Karl Marx, English translation by N. I. Stone, 1894, page

[169] David Ricardo, _Principles of Political Economy and Taxation_,
Chapter I, § III.

[170] _Wealth of Nations_, Book I, Chapter X.

[171] _Principles of Political Economy and Taxation_, Chapter I, Sec. 1,
§ 4.

[172] See "The Final Futility of Final Utility," in H. M. Hyndman's
_Economics of Socialism_, for a remarkable criticism of the "final
utility" theory, showing its identity with the doctrine of supply and
demand as the basis of value.

I refer to the theory of final or marginal utility as the "so-called
Austrian theory" for the purpose, mainly, or calling attention to the
fact that, as Professor Seligman has ably and clearly demonstrated, it
was conceived and excellently stated by W. F. Lloyd, Professor of
Political Economy at Oxford, in 1833. (See the paper, _On Some Neglected
British Economists_, in the _Economic Journal_, V, xiii, pages 357-363.)
This was two decades before Gossen and a generation earlier than Menger
and Jevons. In view of this fact, the criticism of Marx for his lack of
originality by members of the "Austrian" school is rather amusing.

[173] _Principles of Economics_, by Edwin R. A. Seligman (1905), page

[174] Cf., for instance, my little volume, in the _Standard Socialist
Series_ (Kerr), entitled _Capitalist and Laborer_; Part II, _Modern
Socialism_, page 112.

[175] _Principles of Political Economy and Taxation_, Chapter V, § 35.

[176] _Value, Price, and Profit_, by Karl Marx, Chapter XIV.

[177] It is worthy of note that the taxation of land values, commonly
associated with the name of Henry George, was advocated as a palliative
in the _Communist Manifesto_ of Marx and Engels.

[178] _Capital_, by Karl Marx, Vol. I, Chapter XIII, of Part IV.

[179] _The Worker_ (New York), February 5, 1905.




Many persons who have thought of Socialism as a scheme, the plan of a
new social edifice, have been disappointed not to find in all the
voluminous writings of Marx any detailed description of such a plan, any
forecast of the future. But when they have grasped the fundamental
principles of the Marxian system of thought, they realize that it would
be absurd to attempt to give detailed specifications of the Socialist
state. As the Socialist movement has outgrown the influence of the early
Utopians, its adherents have abandoned the habit of speculating upon the
practical application of Socialist principles in future society. The
formulation of schemes, more or less detailed, has given place to firm
insistence that Socialism must be regarded as a principle, namely, the
efficient organization of wealth production and distribution to the end
that the exploitation of the wealth producers by a privileged class may
be rendered impossible. Whatever contributes to that end is a
contribution to the fulfillment of the Socialist ideal.

Still, it is natural and inevitable that earnest Socialists and
students of Socialism should seek something more tangible by way of a
description of the future state than the bald statement that it will be
free from the struggle between exploiting and exploited classes. The
question is, can we go further in our attempt to scan the future without
entering the realms of Utopian speculation? If Socialism is, objectively
considered, a state of society which is being developed in the womb of
the present, are there any signs by which its peculiar form and spirit,
as distinguished from the form and spirit of the present, may be
visualized? Within certain limits, an affirmative answer seems possible
to each of these questions. There are certain fundamental principles
which may be said to be essential to the existence of Socialist society.
Without them, the Socialist state cannot exist. Regardless of the fact
that Karl Marx never attempted to describe his ideal, to give such a
description of his concept of the next epoch in evolution as would
enable us to compare it with the present and to measure the difference,
it is probable that every Socialist makes, privately at least, his own
forecast of the manner in which the new society must shape itself.

There is nothing Utopian or fantastic in trying to ascertain the
tendencies of economic development; nothing unscientific in trying to
read out of the pages of social evolution such lessons as may be
contained therein. So long as we bear in mind that our forecasts must
not take the form of plans for the arbitrary shaping of the future,
specifications of the Coöperative Commonwealth, but that they must, on
the contrary, be based upon the facts of life--not abstract principles
born in the heart's desire--and attempt to discern the tendencies of
social and economic evolution, we are upon safe ground. Such forecasts
may indeed be helpful, not only in so far as they provide us with a more
or less concrete picture of the ideal to be aimed at, but also, and even
more important, in that they at once enable us to gauge from time to
time the progress made by society toward the realization of the ideal,
and to formulate our policies most effectively. Especially as there are
certain fundamental principles essential to the existence of a Socialist
state, we may take these and correlate them, and these principles,
together with our estimate of economic tendencies, drawn from the facts
of the present, may provide us with a suggestive and approximate outline
of the Socialist society of the future. So far we may proceed with full
scientific sanction; beyond are the realms of fancy and dream, the
Elysian Fields of Utopia.[180] We must not set about our task with the
mental attitude so well displayed by the yearning of Omar--

     "Ah Love! could you and I with Him conspire
     To grasp this sorry Scheme of Things entire,
     Would not we shatter it to bits--and then
     Remold it nearer to the Heart's Desire!"

From that spirit only vain dreams and fantastic vagaries can ever come.
What we must bear in mind is that the social fabric of to-morrow, like
that of yesterday, whose ruins we contemplate to-day, will not spring
up, complete, in response to our will, but will grow out of social
experience and needs.


One of the greatest and most lamentable errors in connection with the
propaganda of modern Socialism has been the assumption of its friends,
in many instances, and its foes, in most instances, that Socialism and
Individualism are entirely antithetical concepts. Infinite confusion has
been caused by setting the two against each other. Society consists of
an aggregation of individuals, but it is something more than that in
just the same sense as a house is something more than an aggregation of
bricks. It is an organism, though as yet an imperfectly developed one.
While the units of which it is composed have distinct and independent
lives within certain limits, they are, outside of those limits,
interdependent and inter-related. Man is governed by two great forces.
On the one hand, he is essentially an egoist, ever striving to attain
individual freedom; on the other hand, he is a social animal, ever
seeking association and avoiding isolation. This duality expresses
itself in the life of society. There is a struggle between its members
motived by the desire for individual expression and gain; and, alongside
of it, a sense of solidarity, a movement to mutual, reciprocal
relations, motived by the gregarian instinct. All social life is
necessarily an oscillation between these two motives. The social problem
in its last analysis is nothing more than the problem of combining and
harmonizing social and individual interests and actions springing

In dealing with this social problem, the problem of how to secure
harmony of social and individual interests and actions, it is necessary
first of all to recognize that both motives are equally important and
necessary agents of human progress. The idea largely prevails that
Socialists ignore the individual motive and consider only the social
motive, just as the ultra-individualists have erred in an opposite
discrimination. The Socialist ideal has been conceived to be a great
bureaucracy. Mr. Anstey gave humorous and vivid expression to this idea
in _Punch_ some years ago, when he represented the citizens of the
Socialist state as being all clothed alike, known only by numbers,
strangers to all the joys of family life, plodding through their
allotted tasks under a race of hated bureaucrats, and having the solace
of chewing gum in their leisure time as a specially paternal provision.
Some such mental picture must have inspired Herbert Spencer's "Coming
Slavery," and it must be confessed that the early forms of Socialism
which consisted mainly of detailed plans of coöperative commonwealths
afforded some excuse for the idea. Most intelligent Socialists, if
called upon to choose between them, would probably prefer to live in
Thibet under a personal despotism, rather than under the hierarchies of
most of the imaginary commonwealths which Utopian Socialists have

Even in the later propaganda of the modern political Socialist movement,
there has been more than enough justification for those who regard
Socialism as impossible except under a great bureaucracy. In numberless
Socialist programmes and addresses Socialism has been defined as meaning
"The social ownership and control of all the means of production,
distribution, and exchange." Critics of Socialism are not to be
seriously blamed if they take such "definitions" at their face value and
interpret them quite literally. It is not difficult to see that in order
to place "all means of production, distribution, and exchange" under
social ownership and control, the creation of such a bureaucracy as the
world has never seen would be necessary. A needle is a means of
production quite as much as an electric power machine in a factory is,
the difference being in their degrees of efficiency. A jackknife is,
likewise, in certain circumstances, a means of production, just as
surely as a powerful planing machine is, the difference being in degrees
of efficiency. So a market basket is a means of distribution quite as
surely as an ocean steamship is; a wheelbarrow quite as much as a
locomotive. They differ in degrees of efficiency, that is all. The idea
that the housewife in the future, when she wants to sew a button upon a
garment, will be obliged to go to some department and "take out" a
needle, having it properly checked in the communal accounts, and being
responsible for its return, is, of course, worthy only of opera bouffe.
So is the notion of the state owning wheelbarrows and market baskets and
making their private ownership illegal. "The socialization of _all_ the
means of production, distribution, and exchange," literally interpreted,
is folly. But none of those using the phrase must be regarded as
seriously contemplating its literal interpretation. For many years the
phrase was included in the statement of its "Object" by the English
Social Democratic Federation, and even now it appears in a slightly
modified form, the word "all" being omitted,[181] perhaps because of its
tautological character. For several years the writer was a member of the
Federation, actively engaged in the propaganda, and how we spent much of
our time explaining to popular audiences in halls and upon street
corners that the socialization of jackknives, needles, sewing machines,
market baskets, beer mugs, frying pans, and toothpicks was not our aim,
is a merry memory.

When this is understood, the nightmare of the bureaucracy of Socialism
vanishes. It is no longer necessary to fret ourselves asking how a
government is to own and manage everything without making slaves of its
citizens. The question propounded by that venerable and distinguished
Canadian scholar, Professor Goldwin Smith,[182] whether a government can
be devised which shall hold all the instruments of production,
distribute to the citizens their tasks, pick out inventors,
philosophers, artists, and laborers, and set them to work, without
destroying personal liberty, loses its force when it is remembered that
Socialism involves no such necessity.

The Socialist ideal may be said to be a form of social organization in
which every individual will enjoy the greatest possible amount of
freedom for self-development and expression; and in which social
authority will be reduced to the minimum necessary for the preservation
and insurance of that right to all individuals. There is an
incontestable right of the individual to full and free self-development
and expression so long as no other individual's right to a like freedom
is infringed upon. No individual right can be an _absolute_ right in a
society, but must be subject to such restrictions as may be necessary to
safeguard the like right of every other individual, and of society as a
whole. _Absolute_ personal liberty is not possible; to grant it to any
one individual would be equivalent to denying it to others. If, in a
certain community, a need is commonly felt for a system of drainage to
protect the citizens against the perils of a possible outbreak of
typhoid or some other epidemic disease, and all the citizens agree upon
a scheme except two or three, who, in the name of personal liberty,
declare that their property must not be touched, what is to be done? If
the citizens, out of solicitude for the personal liberty of the
objecting individuals, abandon or modify their plans, is it not clear
that the liberty of the many has been sacrificed to the liberty of the
few, which is the essence of tyranny? Absolute individual liberty is
incompatible with social liberty. The liberty of each must, in Mill's
phrase, be bounded by the like liberty of all. Absolute personal liberty
is a chimera, a delusion.

Even the Anarchist must come to a realization of the fact that liberty
is not an absolute, but a relative and limited, right. Kropotkin, for
example, realizes that, even under Anarchism, any individual who did
not live up to his obligations, or who persisted in conducting himself
in a manner obnoxious or injurious to the community, would have to be
expelled.[183] This is very like Spencer's practical abandonment of the
doctrine of _laissez faire_ individualism. Says he: "Many facts have
shown us that while the individual man has acquired liberty as a citizen
and greater religious liberty, he has also acquired greater liberty in
respect of his occupations; and here we see that he has simultaneously
acquired greater liberty of combination for industrial purposes. Indeed,
in conformity with the universal law of rhythm, _there has been a change
from excess of restriction to deficiency of restriction_. As is implied
by legislation now pending, the facilities for forming companies and
raising compound capitals have been too great."[184] Here is a very
definite confession of the insufficiency of natural law, the failure of
the _laissez faire_ theory, and a virtual appeal for restrictive and
coercive legislation.

This is inevitable. The dual forces which serve as the motives of
individual and collective action, spring, unquestionably, from the fact
that individuals are at once alike and unlike, equal and unequal. Alike
in our needs of certain fundamental necessities, such as food,
clothing, shelter, coöperation for producing these necessities, for
protection from foes, human and other, we are unlike in tastes,
appetites, temperaments, character, will, and so on, till our diversity
becomes as great and as general as our likeness. Now, the problem is to
insure equal opportunities of full development to all these diversely
constituted and endowed individuals, and, at the same time, to maintain
the principle of equal obligations to society on the part of every
individual. This is the problem of social justice: to insure to each the
same social opportunities, to secure from each a recognition of the same
obligations toward all. The basic principle of the Socialist state must
be justice; no privileges or favors can be extended to individuals or
groups of individuals.


Politically, the organization of the Socialist state must be democratic.
Socialism without democracy is as impossible as a shadow without light.
The word "Socialism" applied to schemes of paternalism, and to
government ownership when the vital principle of democracy is lacking,
is a misnomer. As with Peter Bell--

     "A primrose by a river's brim,
     A yellow primrose was to him"

and nothing more than that, so there are many persons to whom Socialism
signifies nothing more than government ownership. Yet it ought to be
perfectly clear that Russia, with her state-owned railways, and liquor
and other monopolies, is no nearer Socialism than the United States. The
same applies to Germany with her state railways. Externally similar in
one respect to Socialism, they radically differ. In so far as they
prepare the necessary forms for Socialism, all examples of public
ownership may be said to be "socialistic," or making for Socialism. What
they lack is a spiritual quality rather than a mechanical one. They are
not democratic. Socialism is political democracy allied to industrial

Justice requires that the legislative power of society rest upon
universal adult suffrage, the political equality of all men and women,
except lunatics and criminals. It is manifestly unjust to exact
obedience to the laws from those who have had no share in making them
and can have no share in altering them. Of course, there are exceptions
to this principle. We except (1) minors, children not yet arrived at the
age of responsibility agreed upon by the citizens; (2) lunatics and
certain classes of criminals; (3) aliens, non-citizens temporarily
resident in the state.

Democracy in the sense of popular self-government, the "government of
the people, by the people, and for the people," of which political
rhetoricians boast, is only approximately attainable in any society.
While all can equally participate in the legislative power, all cannot
participate directly in the administrative power, and it becomes
necessary, therefore, to adopt the principle of delegated authority,
representative government. But care must be taken to preserve a maximum
of power in the hands of the people. In this respect the United States
Constitution is defective. It is not, and was not intended by its
framers to be, a democratic instrument,[185] and we are vainly trying
to-day to make democratic government through an undemocratic medium. The
political democracy of the Socialist state must be real, keeping the
power of government in the hands of the people.

How is this to be done? Direct legislation by the people might be
realized through the adoption of the principles of popular initiative
and referendum. Or, if representative legislative bodies should be
deemed best, these measures, together with proportional representation
and the right of recall, might be adopted. There is no apparent reason
why _all_ legislation, except temporary legislation as in war time,
famine, plague, and such abnormal conditions, could not be directly
initiated and enacted, leaving only the just and proper enforcement of
the law to delegated authority. In practically all the political
programmes of Socialist parties throughout the world, these principles
are included at the present time; not merely as means to secure a
greater degree of political democracy within the existing social state,
but also, and primarily, to prepare the required political framework of
democracy for the industrial commonwealth of the future.

The great problem for such a society, politically speaking, consists in
choosing wisely the trustees of delegated power and authority, and
seeing that they justly and wisely use it for the common good, without
abuse, either for the profit of themselves or their friends, and without
prejudice to any portion of society. Will there be abuses? Will not
political manipulators and bosses betray their trusts? To these
questions, and all other questions of a like nature, the Socialist can
only give one answer, namely, that there is no such a thing as an
"automatic democracy," that eternal vigilance will be the price of
liberty under Socialism as it has ever been. There can be no other
safeguard against the usurpation of power than the popular will and
conscience ever alert upon the watch-towers. With political machinery so
responsive to the popular will when it is asserted and an alert and
vigilant electorate, political democracy attains its maximum
development. Socialism requires that development.


With these general principles prevised, we may consider, briefly, the
respective rights of the individual and of society. The rights of the
individual may be summarized as follows: There must be freedom of
movement, including the right to withdraw from the domain of the
government, to migrate at will to other territories. Freedom of movement
is a fundamental condition of personal liberty, but it is easy to see
that it cannot be made an absolute right. Quarantine laws, for social
protection, for example, may seriously inconvenience the individual, but
be imperatively necessary for all that. There must be immunity from
arrest, except for infringing others' rights, with compensation of some
kind for improper arrest; respect of the privacy of domicile and
correspondence; full liberty of dress, subject to decency; freedom of
utterance, whether by speech or publication, subject only to the
protection of others from insult, injury, or interference with their
equal liberties, the individual being held responsible to society for
the proper use of that right. Freedom of the individual in all that
pertains to art, science, philosophy, and religion, and their teaching,
or propaganda, is essential. The state can have nothing to do with these
matters, they belong to the personal life alone.[186] Art, science,
philosophy, and religion cannot be protected by any authority of the
state, nor is such authority needed.

Subject to the ultimate control of society, certainly, but normally free
from collective authority and control, these may be regarded as
imperative rights of the individual. Doubtless many Socialists, in
common with many Individualists, would considerably extend the list.
Some, for instance, would include the right to possess and bear arms for
the defense of person and property. On the other hand, it might be
objected with good show of reason by other Socialists that such a right
must always be liable to abuses imperiling the peace of society, and
that the same ends would be served more surely if individual armament
were made impossible. Again, some Socialists, like some Individualists,
would include in the category of private acts outside the sphere of law
and social authority the union of the sexes. They would do away with
legal intervention in marriage and make it and the parental relation
exclusively a private concern. On the other hand, probably an
overwhelming majority of Socialists would object. They would insist that
the state must, in the interest of the children, and for its own
self-preservation, assume certain responsibilities for, and exercise a
certain control over, all marriages. They would have the state insist
upon such conditions as mature age, freedom from dangerous diseases and
physical defects. While believing that under Socialism marriage would no
longer be subject to economic motives,--matrimonial markets for titles
and fortunes no longer existing,--and that the maximum of personal
freedom together with the minimum of social authority would be possible
in the union of the sexes, they would still insist upon the necessity of
that minimum of legal control.

The abolition of the legal marriage tie, and the substitution therefor
of voluntary sex union, which so many people believe to be part of the
Socialist programme, is not only not a part of that programme, but is
probably condemned by more than ninety-five per cent of the Socialists
of the world, and favored by no appreciable proportion of Socialists
more than non-Socialists. There is no such thing as a Socialist view of
marriage, any more than there is a Republican or Democratic view of
marriage; or any more than there is a Socialist view of vaccination,
vivisection, vegetarianism, or homeopathy. The same may be said of the
drink evil and tobacco smoking. Some Socialists would prohibit both
smoking and drinking; others would permit smoking, but prohibit the
manufacture of intoxicating liquors; most Socialists recognize the
evils, especially of drunkenness, but believe that it would be foolish
at this time to state in what manner the evils must be dealt with by the
Socialist state.

Our hasty summary by no means exhausts the category of personal
liberties, nor does it rigidly define such liberties. To presume to do
that would be a piece of charlatanry, social quackery of the worst type.
It is not for the Socialist of to-day to determine what the citizens of
a generation hence shall do. The citizens of the future, like the
citizens of to-day, will be living human beings, not mere automatons;
they will not accept places and forms imposed upon them, but make their
own. The object of this phase of our discussion is simply to show that
individual freedom would by no means be crushed out of existence by the
Socialist state. The intolerable bureaucracy of collectivism is wholly
an imaginary evil. There is nothing in the nature of Socialism as it is
understood to-day by its adherents which would prevent a wide extension
of personal liberties in the social régime.

In the same general manner, we may summarize the principal functions of
the state[187] as follows: the state has the right and power to organize
and control the economic system, comprehending in that term the
production and distribution of all social wealth, wherever private
enterprise is dangerous to the social well-being, or is inefficient;
the defense of the community from invasion, from fire, flood, famine, or
disease; the relations with other states, such as trade agreements,
boundary treaties, and the like; the maintenance of order, including the
juridical and police systems in all their branches; and public education
in all its departments. It will be found that these five functions
include all the services which the state may properly undertake, and
that not one of them can safely be intrusted to private enterprise. On
the other hand, it is not at all necessary to assume that the state must
have an _absolute monopoly_ of any one of these groups of functions in
the social organism. It would not be necessary, for example, for the
state to prohibit its citizens from entering into voluntary relations
with the citizens of other countries for the promotion of international
friendship, for trade reciprocity, and so on. Likewise, the juridical
functions being in the hands of the state would not prevent voluntary
arbitration; or the state guardianship of the public health prevent
voluntary associations of citizens from taking measures to advance the
health of their communities. On the contrary, all such efforts would be
advantageous to the state. Our study becomes, therefore, a study of
social physiology.

The principle already postulated, that the state must undertake the
production and distribution of wealth wherever private enterprise is
dangerous, or inefficient, clarifies somewhat the problem of the
industrial organization of the Socialist régime, which is a vastly more
difficult problem than that of its political organization. Socialism by
no means involves the suppression of all private industrial enterprises.
Only when these fail in efficiency or result in injustice and inequality
of opportunities does socialization present itself. There are many
petty, subordinate industries, especially the making of articles of
luxury, which might be well allowed to remain in private hands, subject
only to such general regulation as might be found necessary for the
protection of health and the public order. For example, suppose that the
state undertakes the production of shoes upon a large scale as a result
of the popular conviction that private enterprise in shoemaking is
either inefficient or injurious to society in that the manufacturers
exploit the shoemakers on the one hand, and, through the establishment
of monopoly-prices, the consumers upon the other hand. The state thus
becomes the employer of shoeworkers and the vender of shoes to the
citizens. But A, being a fastidious citizen, does not like the factory
product of the state any more than he formerly did the factory product
of private enterprise. Under the old conditions, he used to employ B, a
shoemaker who does not like factory work, a craftsman who likes to make
the whole shoe. Naturally, B was not willing to work for wages
materially lower than those he could earn in the factory. A willingly
paid enough for his hand-made shoes to insure B as much wages as he
would get in the factory. What reason could the state possibly have for
forbidding the continuance of such an arrangement between two of its

Or take the case of a farmer maintaining himself and family upon a
modest acreage, by his own labor. He exploits no one, and the question
of inefficiency does not present itself as a public question, for the
reason that there is plenty of farming land available, and any
inefficiency of the small farmer does not injure the community in any
manner. What object could the state have in taking away that farm and
compelling the farmer to work upon a communal, publicly owned and
managed farm? Of course, the notion is perfectly absurd.[188] On the
other hand, there are things, natural monopolies, which cannot be safely
left to private enterprise. The same is true of large productive and
distributive enterprises upon which great masses of the people depend.
Land ownership[189] and all that depends thereon, such as mining,
transportation, and the like, must be collective.

It will help us to get rid of the difficulty presented by petty
industry and agriculture if we bear in mind that collective ownership is
not, as is commonly supposed, the supreme, fundamental condition of
Socialism. It is proposed only as a means to an end, not as the end
itself. The wealth producers are exploited by a class whose source of
income is the surplus-value extracted from the workers. Instinctively,
the workers struggle against that exploitation, to reduce the amount of
surplus-value taken by the capitalists to a minimum. To do away with
that exploitation social ownership and control is proposed. If the end
could be attained more speedily by other methods, those methods would be
adopted. It follows, therefore, that to make collective property of
things not used as a means of exploiting labor does not necessarily form
part of the Socialist programme. True, some such things might be
socialized in response to an urgent demand for efficiency, but, of
necessity, the struggle will be principally concerned with the
socializing of the means of production which are used as means of
exploitation by a class deriving its income from the surplus-value
produced by another class. It is easy enough to see that, according to
this principle of differentiation, it would be necessary to socialize
the railroad, but not at all necessary to socialize the wheelbarrow;
while it would be necessary to socialize a clothing factory, it would
not be necessary to take away a woman's domestic sewing machine.
Independent, self-employment, as in the case of a craftsman working in
his own shop with his own tools, or groups of workers working
coöperatively, is quite consistent with Socialism.

In the Socialist state, then, certain forms of private industry will be
tolerated, and perhaps even definitely encouraged by the state, but the
great fundamental economic activities will be collectively managed. The
Socialist state will not be static and, consequently, what at first may
be regarded as being properly the subject of private enterprise may
develop to an extent or in directions which necessitate its
transformation to the category of essentially social properties. Hence,
it is not possible to give a list of things which would be socialized
and another list of things which would remain private property, but
perfectly possible to state the principle which must be the chief
determinant of the extent of socialization. With this principle in mind
it is fairly possible to sketch the outlines at least of the economic
development of the collectivist commonwealth; the conditions essential
to that stage of social evolution at which it will be possible and
natural to speak of capitalism as a past and outgrown stage, and of the
present as the era of Socialism.

Socialists, naturally, differ very materially upon this point. Probably,
however, an overwhelming majority of the leaders of Socialist thought in
Europe and this country would agree with the writer that it is fairly
probable that the economic structure of the new society will include at
least the following measures of socialization: (1) Ownership of all
natural resources, such as land, mines, forests, waterways, oil wells,
and so on; (2) operation of all the means of transportation and
communication other than those of purely personal service; (3) operation
of all industrial production involving large compound capitals and
associated labor, except where carried on by voluntary, democratic
coöperation, with the necessary regulation by the state; (4)
organization of all labor essential to the public service, such as the
building of schools, hospitals, docks, roads, bridges, sewers, and the
like; the construction of all the machinery and plant requisite to the
social production and distribution, and of things necessary for the
maintenance of those engaged in such public services as the national
defense and all who are wards of the state; (5) a monopoly of the
monetary and credit functions, including coinage, banking, mortgaging,
and the extension of credit to private enterprise.

With these economic activities undertaken by the state, a pure democracy
differing vitally from all the class-dominated states of history,
private enterprise would by no means be excluded, but limited to an
extent making the exploitation of labor and public needs and interests
for private gain impossible. Socialism thus becomes the defender of
individual liberty, not its enemy.


As owner of the earth and all the major instruments of production and
exchange, society would occupy a position which would enable it to
insure that the physical and mental benefits derived from its wealth,
its natural resources, its collective experience, genius, and labor,
were universalized as befits a democracy. It would be able to guarantee
to all its citizens the right to labor, through preventing private or
class monopolization of the land and instruments of production and
social opportunities in general. It would be in a position to make every
development from competition to monopoly the occasion for further
socialization. Thus there would be no danger to the state in permitting,
or even fostering, private industry within the limits described. As the
organizer of the vast body of labor essential to the operation of the
main productive and distributive functions of society, and to the other
public services, the state would automatically, so to speak, set the
standards of income and leisure which private industry would be
compelled, by competitive force, to observe. The regulation of
production, too, would be possible, and as a result the crises arising
from glutted markets would disappear. Finally, in the control of all the
functions of credit, the state would effectually prevent the
exploitation of the mass of the people through financial agencies, one
of the greatest evils of our present system.

The application of the principles of democracy to the organization and
administration of these great economic services of production, exchange,
and credit is a problem full of alluring invitations to speculation.
"This that they call the Organization of Labor," said Carlyle, "is the
Universal Vital Problem of the World." This description applies not to
what we commonly mean by the "organization of labor," namely, the
organization of the laborers in unions for class conflict, but to the
organization of the brain and muscle of the world to secure the greatest
efficiency. This is the great central problem of the socialization of
industry and the state, before which all other problems pale into
insignificance. It is comparatively easy to picture an ideal political
democracy; and the main structural economic organization of the
Socialist régime, with its private and public functions more or less
clearly defined, is not very difficult of conception. These are
foreshadowed with varying degrees of distinctness in present society,
and the light of experience illumines the pathway before us. It is when
we come to the methods of organization and management, the _spirit_ of
the economic organization of the future state, that the light fails and
we must grope our way into the great unknown with imagination and our
sense of justice for guides.

Most Socialist writers who have attempted to deal with this subject
have simply regarded the state as the greatest employer of labor,
carrying on its business upon lines not materially different from those
adopted by the great corporations of to-day. Boards of experts, chosen
by civil service methods, directing all the economic activities of the
state--such is their general conception of the industrial democracy of
the Socialist régime. They believe, in other words, that the methods now
employed by the capitalist state, and by individual and corporate
employers within the capitalist state, would simply be extended under
the Socialist régime. If this be so, a psychological anomaly in the
Socialist propaganda appears in the practical abandonment of the claim
that, as a result of the class conflict in society, the public ownership
evolved within the capitalist state is essentially different from, and
inferior to, the public ownership of the Socialist ideal. It is
perfectly clear that if the industrial organization under Socialism is
to be such that the workers employed in any industry have no more voice
in its management than the postal employees in this country, for
example, have at the present time, it cannot be otherwise than absurd to
speak of it as an industrial democracy.

Here, in truth, lies the crux of the greatest problem of all. We must
face the fact that, in anything worthy the name of an industrial
democracy, the terms and conditions of employment cannot be wholly
decided without regard to the will of the workers themselves on the one
hand, nor, on the other hand, by the workers alone without reference to
the general body of the citizenry. If the former method fails to satisfy
the requirements of democracy by ignoring the will of the workers in the
organization of their work, the alternate method involves a hierarchical
government, equally incompatible with democracy. Some way must be found
by which the industrial government of society, the organization of
production and distribution, may be securely and fairly based upon the
dual basis of common civic rights and the rights of the workers in their
special relations as such.

And here we are not wholly left to our imaginations, not wholly without
experience to guide us. In actual practice to-day, in those industries
in which the organization of the workers into unions has been most
successful, the workers, through their organizations, do exercise a
certain amount of control over the conditions of their employment. Their
right to share in the determination of the conditions of labor is
conceded. They make trade agreements, for instance, in which such
matters as wages, hours of labor, apprenticeship, output, engagement and
discharge of workers, and numerous other matters, are provided for and
made subject to the joint control of the workers and their employers. Of
course, this share in the control of the industry in which they are
employed is a right enjoyed only as a fruit of conquest, won by war and
maintained by ceaseless vigilance and armed strength. It is not
inconceivable that in the Socialist state there might be a frank
extension of this principle. The workers in the main groups of
industries might form autonomous organizations for the administration of
their special interests, subject only to certain fundamental laws of the
state. Thus the trade unions of to-day would evolve into administrative
politico-economic organizations, after the manner of the mediæval
guilds, and become constructive agencies in society instead of mere
agencies of class warfare as at present.

The economic organization of the Socialist state would consist, then, of
three distinct divisions, as follows: (1) Private production and
exchange, subject only to such general supervision and control by the
state as the interests of society demand, such as protection against
monopolization, sanitary laws, and the like; (2) voluntary coöperation,
subject to similar supervision and control; (3) production and
distribution by the state, the administration to be by the autonomous
organizations of the workers in industrial groups, subject to the
fundamental laws and government of society as a whole.[190]


Two other functions of the economic organization of society remain to be
considered, the distribution of labor and its remuneration. In the
organization of industry society will have to achieve a twofold result,
a maximum of general, social efficiency, on the one hand, and of
personal liberty and comfort to the workers on the other. The state
would not only guarantee the right to labor, but, as a corollary, it
would impose the duty of labor upon every competent person. The Pauline
injunction, "If any man will not work, neither shall he eat," would be
applied in the Socialist state to all except the incompetent to labor.
The immature child, the aged, the sick and infirm members of society,
would alone be exempted from labor. The result of this would be that
instead of a large unemployed army, vainly seeking the right to work, on
the one hand, accompanied by the excessive overwork of the great mass of
the workers fortunate enough to be employed, a vast increase in the
number of producers from this one cause alone would make possible much
greater leisure for the whole body of workers. Benjamin Franklin
estimated that in his day four hours' labor from every adult male able
to work would be more than sufficient to provide wealth enough for human
wants; and it is certain that, without resorting to any standards of
Spartan simplicity, Franklin's estimate could be easily realised to-day
with anything approaching a scientific organization of labor.

Not only would the productive forces be enormously increased by the
absorption of those workers who under the present system are unemployed,
and those who do not labor or seek labor; in addition to these, there
would be a tremendous transference of potential productive energy from
occupations rendered obsolete and unnecessary by the socialization of
society. Thus there are to-day tens of thousands of bankers, lawyers,
traders, middlemen, speculators, advertisers, and others, whose
functions, necessary to the capitalist system, would in most cases
disappear. Because of this, they would be compelled to enter the
producing class. The possibilities of the scientific organization of
industry are therefore almost unlimited. Every gain made by the state in
the direction of economy of production would test the private enterprise
existing and urge it onward in the same direction. Likewise, every gain
made by the private producers would test the social production and urge
it onward. Whether socialized production extended its sphere, or
remained confined to its minimum limitations, would depend upon the
comparative success or failure resulting. The state would not be a force
outside of the people, arbitrarily extending its functions regardless of
their will. The decision would rest with the people; they would _be_ the
state, and would, naturally, resort to social effort only where it
demonstrated its ability to serve the community more efficiently than
private enterprise, with greater comfort and liberty to the individual
and to the community.

While in the Socialist régime labor would be compulsory, it is
inconceivable that a free people would tolerate a bureaucratic rule
assigning to each individual his or her proper task, no matter how
ingenious the assignment might be. Even if the bureaucracy were
omniscient, such a condition of life would be intolerable. Just as it is
necessary to insist that all must be secured in their right to labor,
and required to labor, it is necessary also that the choice of one's
occupation should be as far as possible personal and free, subject only
to the laws of supply and demand. The greatest amount of personal
freedom compatible with the requisite efficiency would be secured to the
workers in their chosen occupations through their craft organizations.

But, it will be objected, all occupations are not equally desirable.
There are certain forms of work which, disagreeable in themselves, are
just as essential to the well-being of society as the most artistic and
pleasing. Who will do the dirty work, and the dangerous work, under
Socialism? Will these occupations also be left to choice, and, if so,
will there not be an insurmountable difficulty arising from the natural
reluctance of men to choose such work?

In answering the question and affirming the principle of free
choice--for so it must be answered--the Socialist is called upon to show
that the absence of compulsion would not involve the neglect of these
disagreeable, but highly important, social services; that it would be
compatible with social safety to leave them to personal choice. In the
first place, much of this kind of work that is now performed by human
labor could be more efficiently done by mechanical means. Much of the
work done by sweated women and children in our cities is in fact done in
competition with machines. Machinery has been invented, and is now
available, to do thousands of the disagreeable and hurtful things now
done by human beings. Professor Franklin H. Giddings is perfectly right
when he says: "Modern civilization does not require, it does not need,
the drudgery of needle-women or the crushing toil of men in a score of
life-destroying occupations. If these wretched beings should drop out
of existence and no others take their places, the economic activities of
the world would not greatly suffer. A thousand devices latent in
inventive brains would quickly make good any momentary loss."[191]

When, in England, a law was passed forbidding the practice of forcing
little boys through chimneys, to clean them, chimneys did not cease to
be swept. Other, less disagreeable and less dangerous, means were
quickly invented. When the woolen manufacturers were prevented from
employing little boys and girls, they invented the piecing machine.[192]
Thousands of instances might be compiled in support of the contention of
Professor Giddings, equally as pertinent as these. Another important
point is that the amount of such disagreeable and dangerous work to be
done would be very much less than now. That would be an inevitable
result of the scientific organization of industry. It is likely that, if
the subject could be properly investigated, it could be shown that the
amount of such labor involved in wasteful and unnecessary advertising
alone is enormous.

Addressing an audience composed mainly of scientific men upon the
subject of Socialism, the writer was once questioned upon this phase of
the subject. "Gentlemen," was the reply, "it is impossible for me to
say exactly how the intelligence of the people in a more or less remote
future will solve the problem. The Socialist state will be a democracy,
not a dictatorship. But if I were dictator of society to-day and wanted
to solve the problem, I should assign to such men as yourselves all the
most disagreeable and dangerous tasks I could find. This I should do
because I should know that at once your inventive brains would begin to
devise mechanical and other means of doing the work. You would make
sewer cleaning as pleasant as any other occupation in the world." There
was, of course, nothing original in the reply, but the men of science
recognized its force, and it fairly states one important part of the
Socialist answer to the objection we are discussing. Still, with all
possible reduction of the quantity of such work to be done, and with all
the mechanical genius brought to bear upon it, we may freely concede
that, for a long time to come, there must be some work quite dangerous,
altogether disagreeable and repellent, and a great difference in the
degree of attractiveness of some occupations as compared with some
others. But an occupation repellent in itself might be made attractive,
if the hours of labor were relatively few as compared with other
occupations. If six hours be regarded as the normal working day, it is
quite easy to believe that, for sake of the larger leisure, with its
opportunities for the pursuit of special interests, many a man would
gladly accept a disagreeable position for three hours a day.

The same holds true of superior remuneration. Under the Socialist
régime, just as to-day, many a man would gladly exchange his work for
less pleasant work, if the remuneration offered were higher. To the old
Utopian ideas of absolute equality and uniformity of income these
methods would be fatal, but they are not at all incompatible with
modern, scientific Socialism. Nothing could well be sillier, or more
futile, than the Rooseveltian attacks upon the Socialism of to-day as if
it meant equality of possession, or equality of anything except
opportunity.[193] Finally, in connection with this question, we must not
forget that there is a natural inequality of talent, of power. In any
state of society most men will prefer to do the things they are best
fitted for, the things they can do best. The man who feels himself to be
best fitted to be a hewer of wood or a drawer of water will choose that
rather than some loftier task. There is no reason at all to suppose that
leaving the choice of occupation to the individual would involve the
slightest risk to society.

While equality of remuneration, meaning by that uniformity of reward
for labor, is not an essential condition of the Socialist régime, it may
be freely admitted that _approximate equality of income_ is the ideal to
be ultimately aimed at. Otherwise, if there should be the present
inequality of remuneration, represented by the enormous salary of a
manager like Mr. Schwab, to quote a conspicuous example, and the meager
wage of the average laborer, class formations must take place and the
old problems incidental to economic inequality reappear. There is no
need to regard uniformity of reward for all as the only solution of this
problem, however. Given such an industrial democracy as is herein
suggested as the essential condition of Socialism, there is little
reason to doubt that gradually, by the free play of economic law,
approximate equality would be attained. This brings us to the method of
the remuneration of labor.


Socialists are too often judged by their shibboleths, rather than by the
principles which those shibboleths imperfectly express, or seek to
express. Declaiming, rightly, against the wages system as a form of
slave labor,[194] the "abolition of wage slavery," forever inscribed on
their banners, the average man is forced to the conclusion that the
Socialists are working for a system in which the workers will divide
their actual products and then barter the surplus for the surplus
products of other workers. Either that, or the most rigid system of
governmental production and a method of distributing rations and
uniforms similar to that which obtains in the military organization of
present-day governments. It is easily seen, however, that such plans do
not conform to the democratic ideals of the Socialists, on the one hand,
nor would either of them, on the other hand, be compatible with the wide
personal liberty herein put forward as characteristic of the Socialist

The earlier Utopian Socialists did propose to do away with wages; in
fact, they proposed to do away with money altogether, and invented
various forms of "Labor Notes" as a means of giving equality of
remuneration for given quantities of labor, and providing a medium for
the exchange of wealth. But when the Socialists of to-day speak of the
"abolition of wages," or of the wages system, they use the words in the
same sense as they speak of the abolition of capital: _they would
abolish only the social relations implied in the terms_. Just as they do
not mean by the abolition of capital the destruction of the machinery
and implements of production, but the social relation in which they are
used to create profit for the few, so, when they speak of the abolition
of the wages system, they mean only the use of wages to exploit the
producers for the gain of the owners of the means of production and
exchange. Though the name "wages" might not be changed, a money payment
for labor in a democratic arrangement of industry, representing an
approximation to the full value of the labor, minus only its share of
the cost of maintaining the public services, and the weaker, dependent
members of society, would be vastly different from a money payment for
labor by one individual to other individuals, representing an
approximation to their cost of living, bearing no definite relation to
the value of their labor products, and paid in lieu of those products
with a view to the gathering of a rich surplus value by the payer.

Karl Kautsky, perhaps the greatest living exponent of the theories of
modern Socialism, has made this point perfectly clear. He accepts
without reserve the belief that wages, unequal and paid in money, will
be the method of remuneration for labor in the Socialist régime.[195]
When too many laborers rush into certain branches of industry, the
natural way to lessen their number and to increase the number of
laborers in other branches where there is need for them, will be to
reduce wages in the one and to increase them in the other. Socialism,
instead of being defined as an attempt to make men equal, might perhaps
be more justly and accurately defined as a social system based upon the
natural inequalities of mankind. Not human equality, but equality of
opportunity, and the prevention of the creation of artificial
inequalities by privilege, is the essence of Socialism.

What, it may be asked, will society do to prevent the hoarding of wealth
on the one hand, and the exploitation of the spendthrift by the
abstinent upon the other? Here, as throughout this discussion, we must
be careful to refrain from laying down dogmatic rules, giving
categorical replies to questions which the future will settle in its own
way. At best, we can only reason as to what possible answers are
compatible with the fundamental principles of Socialism. Thus we may
safely answer that in the Socialist régime society will not attempt to
dictate to the individual how he shall spend his income. If Jones
prefers _objets d'art_, and Smith prefers fast horses or a steam yacht,
each will be free to follow his inclinations so far as his resources
will permit. If, on the contrary, one should prefer to hoard his wealth,
he would be free to do so. The inheritance of such accumulated property,
other than personal objects, of course, might be denied, the state being
made the only possible inheritor of such accumulated property. Even in
the absence of such a regulation, the inheritance of hoarded wealth
would not be a serious matter and would speedily adjust itself. There
would be no opportunity for its _investment_, so that at most
individuals inheriting such property would be enabled to live idly, or
with extra luxury, until it was spent. The fact of inheriting property
would not give the individual power over the life and labor of others.
By either method, full play for individual liberty would be coupled with
full economic security for society. There would be no danger of the
development of a ruling class as a result of natural inequalities.

With such conditions as these, it is not difficult nor in any sense
romantic to suppose that the tendency to hoard wealth would largely
disappear. In the same way we must regard the possibilities of the
exploitation of man by man developing in the Socialist state, through
the wastefulness and improvidence of the one and the frugality,
abstinence, and cunning of the other, as slight. With the credit
functions entirely in the hands of the state, the improvident man would
be able to obtain credit upon the same securities as from a private
creditor, without extortion. Society would further secure itself against
the weakness and failure of the improvident by insuring all its members
against sickness, accident, and old age.


The administration of justice is necessarily a social function in a
democratic society. All juridical functions should be socialized in the
strict sense of being maintained at the social expense for the free
service of its citizens. Court fees, advocates' charges, and other
expenses incidental to the administration of justice in present society
are all anti-democratic and subversive of justice.

Finally, education is likewise a social necessity which society itself
must assume responsibility for. We have discovered that for
self-protection society must insist upon a certain minimum of education
for every child able to receive it; that it is too vital a matter to be
left to the option of parents or the desires of the immature child. We
have made a certain minimum of education compulsory and free; the
Socialist state would make a minimum--probably much larger than our
present minimum--compulsory, but it would also make _all_ education
free. From the first stages, in the kindergartens, to the last, in the
universities, education must be wholly free or equality of opportunity
cannot be realized. So long as a single barrier exists to prevent any
child from receiving all the education it is capable of profiting by,
democracy is unattained.

Whether the Socialist state could tolerate the existence of elementary
schools other than its own, such as privately conducted kindergartens,
religious schools, and so on, is by no means agreed upon by Socialists.
It is like the question of marriage, a matter which is wholly beyond the
scope of present knowledge. The future will decide for itself. There are
those who believe that the state would not content itself with refusing
to permit religious doctrines or ideas to be taught in the schools, but
would go further, and, as the protector of the child, guard its
independence of thought in later life as far as possible by forbidding
religious teaching of any kind in schools for children below a certain
age. It would not, of course, attempt to prevent parental instruction in
religious beliefs in the home. Beyond the age prescribed, religious
education, in all other than public institutions of learning, would be
freely admitted. This restriction of religious education to the years of
judgment and discretion implies no hostility to religion on the part of
the state, but complete neutrality. Not the least important of the
rights of the child is the right to be protected from influences which
bias the mind and destroy the possibilities of independent thought in
later life, or make it attainable only as a result of bitter, needless,
tragic experience. This is one view. On the other hand, there are
probably quite as many Socialists who believe that the state would not
attempt to prevent the religious education of children of any age, in
schools voluntarily maintained for that purpose, independent of the
public schools. They believe that the state would content itself with
insisting that these religious schools must be so built and equipped as
not to imperil the lives or the health of the children attending them,
and so conducted as not to interfere with the public schools,--all of
which means simply that, like vaccination, and the form of marriage
contract, the question will be settled by the future in its own way.
There is nothing in the fundamental principles of Socialism, nor any
body of facts in our present experience, from which we can judge the
manner of that settlement.

In this brief outline of the Socialist state as the writer, in common
with many of his associates, conceives it, there are many gaps. The
temptation to fill in the outline somewhat more in detail is strong, but
that is beyond the borderland which divides scientific and Utopian
methods. The purpose of the outline is mainly to show that the ideal of
the Socialism of to-day is something far removed from the network of
laws and the oppressive bureaucracy commonly imagined; something wholly
different in spirit and substance from the mechanical arrangement of
human relations imagined by Utopian romancers. If the Socialist
propaganda of to-day largely consists of the advocacy of laws for the
protection of labor and dealing with all kinds of evils, it must be
remembered that these are to _ameliorate conditions in the existing
social order_. Many of the laws for which Socialists have most
strenuously fought have their _raison d'être_ in the conditions of
capitalist society, and would be quite unnecessary under Socialism. If a
reference to one's personal work may be pardoned, I will cite the matter
of the feeding of school children, in the public schools, at the public
expense. I have, for many years, advocated this measure, which is to be
found in most Socialist programmes, and which the Socialists of other
countries have to a considerable extent carried into practical effect.
Yet, I am free to say that the plan is not my ideal of the manner in
which children should be fed. It is, at best, a palliative, a necessary
evil, rendered necessary by the conditions of capitalist society. One
hopes that in the Socialist régime, home life would be so far developed
as to make possible the proper feeding and care of all children in their
homes. This is but an illustration. The Socialist ideal of the state of
the future, when private property is no longer an instrument of
oppression used by the few against the many, is not a life completely
enmeshed in a network of government, but a life controlled by government
as little as possible; not a life ruled and driven by a powerful engine
of laws, but a life as spontaneous and free as possible--a maximum of
personal freedom with a minimum of restraint.

     "These things shall be! A loftier race
     Than e'er the world hath known shall rise
     With flower of freedom in their souls
     And light of science in their eyes."[196]


[180] Cf. _Das Erfurter Program_, by Karl Kautsky.

[181] Cf. Ensor's _Modern Socialism_, page 351.

[182] _Labour and Capital: a Letter to a Labour Friend_, by Goldwin
Smith, D.C.L. (Macmillan, 1907).

The reader of Professor Smith's little book is referred, for the
Socialist answer to his criticisms, to a small volume by the author of
this book: _Capitalist and Laborer: an Open Letter to Professor Goldwin
Smith_, D.C.L. (Kerr, _Standard Socialist Series_), 1907.

[183] _La Conquête du pain_, Pierre Kropotkin, 5th edition, Paris, 1895,
page 202.

[184] _The Principles of Sociology_, by Herbert Spencer, Vol. III, page

[185] Cf. _The Spirit of American Government_, by J. Allen Smith, LL.B.
Ph.D., for a discussion of this subject.

[186] This statement must not be interpreted too narrowly, of course.
While the nature of these things makes possible an infinitely wider
range of personal liberty than is possible in some other things,
individual liberty must _ultimately_ be governed by the liberty of
others. A fanatical religious sect practicing human sacrifice, for
instance, could not be tolerated by any civilized society. Obscenity in
art is another example.

[187] I use the word "state" throughout this discussion in its largest,
most comprehensive sense, as meaning the whole political organization of

[188] This view is fully shared by Kautsky, _Agrarfrage_, pages 443-444,
and by Paul Lafargue, _Revue Politique et Parliamentaire_, October,
1898, page 70.

[189] Of course, this does not mean that there must not be private _use_
of land.

[190] The student who cares to pursue the subject will find that this
analysis is, in the main, agreed to by the most eminent exponents of
Marxian Socialism to-day. Cf., for instance, Kautsky's _Das Erfurter
Program_; the same writer's _The Social Revolution_, especially pages
117, 159; Vandervelde, quoted by Ensor, _Modern Socialism_, page 205;
also, Vandervelde's _Collectivism_, page 46. Jaurès, the brilliant
French Socialist, may not perhaps be strictly included in the category
of "eminent Marxists," but he accepts the position of Kautsky, see
_Studies in Socialism_, by Jean Jaurès, pages 36-40. See, also, Engels,
_Die Bauernfrage in Frankreich und Deutschland_, published in _Die Neue
Zeit_, 1894-1895, No. 10; Kautsky, _Die Agrarfrage_; and Simons, _The
American Farmer_. That most of these deal with petty agriculture rather
than petty industry is true, but the principle holds in regard to both.

[191] "Ethics of Social Progress," by Professor Franklin H. Giddings in
_Philanthropy and Social Progress_ (1893), page 226.

[192] "The Economics of Factory Legislation," in _The Case For the
Factory Acts_, by Mrs. Sidney Webb, page 50.

[193] See, for instance, Mr. Roosevelt's speech at Matinecock, L.I.,
near Oyster Bay, July 11, 1908, as reported in the daily papers by the
Associated Press. Also, the Republican National Platform, 1908, which
states that Socialism stands for "equality of possession," while the
Republican Party stands for "equality of opportunity"--a complete
misrepresentation, both of Socialism and the Republican Party!

[194] For condemning the wages system as a form of slavery, Socialists
are often vigorously condemned, but there are few sociologists of repute
who question the truth of the Socialist claim. Herbert Spencer, for
example, is as vigorous in asserting that wage-labor is a form of
slavery as any Socialist. See _The Principles of Sociology_, Vol. III,
Chapter 18.

[195] See Kautsky's _Das Erfurter Program_, and also _The Social
Revolution_, especially pages 128-135; Anton Menger, _L'État
Socialiste_, page 35; and Vandervelde's _Collectivism_, pages 149-150.

[196] J. Addington Symonds.




You ask me how the goal I have described is to be attained: "The
picture," you say, "is attractive, but we would like to know how we are
to reach the Promised Land which it pictures. Show us the way!" The
question is a fair one, and I shall try to answer it with candor, as it
deserves. But I cannot promise to tell how the change will be brought
about, to describe the exact process by which social property will
supplant capitalist private property. The only conditions under which
any honest thinker could give such an answer would necessitate a
combination of circumstances which has never existed, and which no one
seriously expects to develop. To answer in definite terms, saying, "This
is the manner in which the change will be made," one would have to know
the exact time of the change; precisely what things would be socialized;
the thought of the people, their temper, their courage. In a word,
omniscience would be necessary to enable one to make such a reply.

All that is possible in this connection for the candid Socialist is to
point out those tendencies which he believes to be making for the
Socialist ideal, those tendencies in society, whether political or
economic, which are making for industrial democracy; to consider frankly
the difficulties which must be overcome before the transition from
capitalism can be effected, and to suggest such means of overcoming
these as present themselves to the mind, always remembering that other
means may be developed which we cannot now see, and that great storms of
elemental human passion may sweep the current into channels unsuspected.

Those who are familiar with the writings of Marx know that, in strange
contrast with the fundamental principles of that theory of social
evolution which he so well developed, he lapsed at times into the
Utopian habit of predicting the sudden transformation of society.
Capitalism was to end in a great final "catastrophe" and the new order
be born in the travail of a "social revolution." I remember that when I
joined the Socialist movement, many years ago, the Social Revolution was
a very real event, inevitable and nigh at hand, to most of us. The more
enthusiastic of us dreamed of it; we sang songs in the spirit of the
_Chansons Revolutionaires_, one of which, as I recall, told plainly
enough what we would do--

     "When the Revolution comes."

Some comrades actually wanted to have military drill at our business
meetings, merely that we might be ready for the Revolution, which might
occur any Monday morning or Friday afternoon. If this seems strange and
comic as I relate it to-day, please remember that we were very few and
very young, and, therefore, very sure that we were to redeem the world.
We lived in a state of revolutionary ecstasy. Some of us, I think, must
have gone regularly to sleep in the mental state of Tennyson's May
Queen, with words equivalent to her childish admonition--

     "If you're waking call me early,"

so fearful were we that the Revolution might start without us!

There can be no harm in these confessions to-day, for we have grown far
enough beyond that period to laugh at it in retrospect. True, there is
still a good deal of talk about the Social Revolution, and there may be
a few Socialists here and there who use the term in the sense I have
described; who believe that capitalism will come to a great crisis, that
there will be a rising of millions in wrath, a night of fury and agony,
and then the sunrise of Brotherhood above the blood-stained valley and
the corpse-strewn plain. But most of us, when we use the old term, by
sheer force of habit, or as an inherited tradition, think of the Social
Revolution in no such spirit. We think only of the change that must
come over society, transferring the control of its life from the few to
the many, the change that is now going on all around us. When the time
comes that men and women speak of the state in which they live as
Socialism, and look back upon the life we live to-day with wonder and
pity, they will speak of the period of revolution as including this very
year, and, possibly, all the years included in the lives of the youngest
persons present. At all events, no considerable body of Socialists
anywhere in the world to-day, and no Socialist whose words have any
influence in the movement, believe that there will be a sudden, violent
change from capitalism to Socialism.

If it seemed necessary, abundant testimony to the truthfulness of this
claim could be produced. But I shall content myself with two
witnesses--chosen from the multitude of available witnesses for reasons
which will unfold themselves. The first witness is Marx himself. I
choose his testimony, mainly, because there is no other name so great as
his, and, secondly, to show that his profoundest thought rejected the
idea of sudden social transformations which at times he seemed to favor.
It is 1850. Marx is in London, actively engaged in a German Communist
movement with its Central Committee in that great metropolis. The
majority are impatient, feverishly urging revolt; they are under the
illusion that they can make the Social Revolution at once. Marx tells
them, on the contrary, that it will take fifty years "not only to change
existing conditions but to change yourselves and make yourselves worthy
of political power." They, the majority, say on the other hand, "We
ought to get power at once, or else give up the fight." Marx tries
vainly to make them see this, and resigns when he fails, scornfully
telling them that they "substitute revolutionary phrases for
_revolutionary evolution_."[198] Mark well that term, "revolutionary
evolution," for it bears out the description I have attempted of the
sense in which we speak of revolution in the Socialist propaganda of
to-day. And mark well, also, that Marx gave them fifty years simply to
make themselves worthy of political power.

As the second witness, I choose Liebknecht, whose name must always be
associated with those of Marx, Engels, and Lassalle, in Socialist
history. Not alone because of the fact that Liebknecht, more than almost
any other man, has influenced the tactics of the international Socialist
movement, but for the additional reason that detached phrases of his are
sometimes quoted in support of the opposite view. Words spoken in
oratorical and forensic passion, or in the bravado of irresponsible
youthfulness, and texts torn from their contexts, are used to show that
Liebknecht anticipated the violent transformation of society. But heed
this, one of many similar statements of his maturest and profoundest
thought: "_But we are not going to attain Socialism at one bound. The
transition is going on all the time_, and the important thing for us ...
is not to paint a picture of the future--which in any case would be
useless labor--_but to forecast a practical programme for the
intermediate period, to formulate and justify measures that shall be
applicable at once, and that will serve as aids to the new Socialist

So much, then, for quotations from the mightiest of all our hosts. What
I would make clear is not merely that the greatest of Socialist
theorists and tacticians agree that the change will be brought about
gradually, and not by one stroke of revolutionary action, but that, more
important still, the Socialist Party of this country, and all the
Socialist parties of the world, are based upon that idea. That is why
they have their political programmes, aiming to make the conditions of
life better now, in the transition period, and also to aid in the happy,
peaceful birth of the new order.


Having disposed of the notion that Socialists expect to realize their
ideals by a single stroke, and thus swept away some of the greatest
obstacles which rise before the imagination of the student of
Socialism, we obtain a clearer vision of the problem. And that is no
small advance toward its solution.

Concerning the political organization of the Socialist state, so far as
the extension of political democracy is concerned, not much need be
said. You can very readily comprehend that this may be done by legal,
constitutional means. Step by step, just as we attain power enough to do
so, we shall extend the power of the people until we have a complete
political democracy. Where, as in some of the Southern States, there is
virtually a property qualification for the franchise, where that remnant
of feudalism, the poll tax, remains, Socialists, whenever they come into
power in those states, or whenever they are strong enough to force the
issue, will insist upon making the franchise free. And where, as in this
state, there is a sex qualification for the franchise, women being
denied the suffrage, they will work unceasingly to do away with that
relic of barbarism. By means of such measures as the Initiative and
Referendum, and election of judges by the people, the sovereignty of the
people will be established. It may be that without some constitutional
amendments it will be found impossible to make political democracy
complete. In that case, moving along the line of least resistance, they
will do all that they can within the limits of the Constitution as it
is, changing it whenever by reason of their power they deem that

As to the organization of the industrial life of the Socialist state,
bringing industry from private to public control, here, too, Socialists
will work along the line of least resistance. First of all, it must be
remembered that there are tendencies to that end within society at
present. Every development of industry and commerce, from competition to
monopoly, so far as it centers the control in few hands and organizes
the industry or business, makes it possible to take it over without
dislocation, and, at the same time, makes it the interest of a larger
number to help in bringing about that transfer. In like manner every
voluntary coöperative organization of producers makes for the Socialist
ideal. This is a far less important matter in the United States than in
England and other European countries. Finally, we have the enormous
extension of public functions developed already in capitalist society,
and being constantly extended. Our postal system, public schools, state
universities, libraries, museums, art galleries, parks, bureaus of
research and information, hospitals, sanatoria, municipal ferries, water
supply, fire departments, health boards, lighting systems, these, and a
thousand other activities of our municipalities and states, and the
nation, are so many forms created by capitalism to meet its own needs
which belong, however, to Socialism and require only to be infused with
the Socialist spirit. This will be done as they come under the
influence of Socialists elected to various legislative and
administrative bodies in ever increasing number as the movement grows.

All this is not difficult to comprehend. What is more likely to perplex
the average man is the method by which Socialists propose to effect the
transfer of individual or corporate property to the collectivity. Will
it be confiscated, taken without recompense; and if so, will it not be
necessary to take the bank savings of the poor widow as well as the
millions of the millionaire? On the other hand, if compensation is
given, will there not be still a privileged class, a wealthy class, that
is, and a poorer class? These are the questions I see written upon your
faces as I look down upon them and read the language of their strained
interest. Every face seems a challenge to answer these questions. I
shall try to answer them with perfect candor, as far as that is possible
within the limits of our time. May I not ask you, then, to follow
carefully a brief series of propositions, or postulates, which I shall,
with your permission, lay before you?

_First:_ The act of transfer, whether it take the form of confiscation
or otherwise, must be the will of a legal majority of the people. If the
unit is the city, a legal majority of the citizens there; if the unit is
the state, then a legal majority of the citizens of the state; if the
unit is the nation, then a legal majority in the nation. I use the term
"legal majority" to indicate my profound conviction that the process
itself must be a legal, constitutional process. Of course, in the event
of some great upheaval occurring, such as, for example, the rising of a
suffering and desperate people in consequence of some terrific panic or
period of depression, brought on by capitalist misrule, or by war, this
might be swept away. Throughout the world's history such upheavals have
occurred, when the people's wrath, or their desperation, has assumed the
form of a cyclone, and in such times laws have been of no more
resistance than straws in the pathway of the cyclone sweeping across the
plain. Omitting such dire happenings from our calculations--for so we
must wish to do--we may lay down this principle of the imperative
necessity for a legal majority, acting in legal manner.

_Second:_ The process must be gradual. There will be no _coup de force_.
No effort will be made to socialize those industries which have not been
made ready by a degree of monopolization. This we can say with
confidence, if for no other reason than that we cannot conceive a legal
majority being stirred sufficiently to take action in the absence of
some degree of oppression or danger, such as monopoly alone contains.
Further, as a matter of hard, practical sense, it is not conceivable
that any government will ever be able to deal with all the industries
at one time. The railroads may be first to be taken, or it may be the
mines in one state and the oil wells in another. The important point is
to see that the process of socialization _must_ be piecemeal and
gradual. This does not mean that it must be a _slow_ process, suggesting
the slowness of geologic formations, but that it must be gradual,
progressive, advancing from step to step, and giving opportunities for
adjusting things. Otherwise there would be chaos and anarchy.

_Third:_ The manner of the acquisition must be determined by the people
at the time, and not fixed by us in advance, according to some abstract
principle. If the people decide to take any particular individual or
corporate property without compensation, that will be done. And they
will have great historic precedents for their action. The Socialists of
Europe could point to the manner in which many of the feudal estates and
rights were confiscated, while American Socialists could point to the
manner in which, without indemnity or compensation, chattel slavery was

So much is said merely by way of explanation, first, that the manner of
acquiring private and corporate property and making it social property
is not to be decided in advance, and secondly, that there are historic
precedents for confiscation. On the other hand, there is no good reason
why compensation should not be paid for such properties. You start! You
have been more shocked than if I had said we should seize the properties
and cut the throats of the proprietors! Be assured: I am not forgetting
my promise to be frank with you, nor am I expressing my personal opinion
merely when I say that there is nothing in the theory of modern
Socialism which precludes the possibility of compensation. There is no
Socialist of repute and authority in the world, so far as my knowledge
goes, who makes a contrary claim. I should regard it as unworthy to lay
down as the Socialist position views which were my own, and which were
not shared by the great body of Socialist thinkers throughout the world.
It is not less nor more than the truth that all the leading Socialists
of the world agree that compensation could be paid without doing
violence to a single Socialist principle, and most of them favor

Once more I shall appeal to the authority of Marx. Engels wrote in 1894:
"We do not at all consider the indemnification of the proprietors as an
impossibility, whatever may be the circumstances. How many times has not
Karl Marx expressed to me the opinion that if we could buy up the whole
crowd it would really be the cheapest way of relieving ourselves of
them."[201] Not only Marx, then, in the most intimate of his discussions
with Engels, his bosom friend, but Engels himself, in almost his last
days, refused to admit the impossibility of paying indemnity for
properties socialized, "_whatever may be the circumstances_."

Now, as to the difficulties--especially as to the widow's savings. The
socialization of non-productive wealth is not contemplated by any
Socialist, no matter whether it consist of the widow's savings in a
stocking or the treasures in the safe deposit vaults of the rich. Mere
wealth, whether in money or precious gems and jewels, need not trouble
us. Non-productive wealth is outside of our calculation. In the next
place, as I have attempted to make clear, the petty business, the
individual store, the small workshop, and the farm operated by its
owner, would not, necessarily, nor probably, be disturbed. We have to
consider only the great agencies of exploitation, industries operated by
many producers of surplus-value for the benefit of the few. Let us, for
example, take a conspicuous industrial organization, the so-called Steel
Trust. Suppose the Socialists to be in power: there is a popular demand
for the socialization of the steel industry. The government decides to
take over the plant of the Steel Trust and all its affairs, and the
support of the vast majority of the people is assured. First a
valuation takes place, and then bonds, government bonds, are issued.
Unlike what happens too often at the present time, the price fixed is
not greatly in excess of the value the people acquire--one of the means
by which the capitalists fasten their clutches on the popular throat.
The Socialist _spirit_ enters into the business. Bonds are issued to all
the shareholders in strict proportion to their holdings, and so the poor
widow, concerning whose interests critics of Socialism are so
solicitous, gets bonds for her share. She is therefore even more secure
than before, since it is no longer possible for unscrupulous individuals
to plunder her by nefarious stock transactions.

So far, good and well. But, you may rightly say, this will not eliminate
the unearned incomes. The heavy stockholders will simply become rich
bondholders. Temporarily, that is true. But when that has been
accomplished in a few of the more important industries, they will find
it difficult to invest their surplus incomes profitably. There will also
be a surplus to the state over and above the amounts annually paid in
redemption of the bonds. Finally, it will be possible to adopt measures
for eliminating the unearned incomes entirely by means of taxation, such
as the progressive income tax, property and inheritance taxes. Taxation
is, of course, a form of confiscation, but it is a form which has
become familiar, which is perfectly legal, and which enables the
confiscatory process to be stretched out over a long enough period to
make it comparatively easy, to reduce the hardship to a minimum. By
means of a progressive income tax, a bond tax, and an inheritance tax,
it would be possible to eliminate the unearned incomes of a class of
bondholders from society within a reasonable period, without inflicting
injury or hardship upon any human being.

I do not, let me again warn you, set this plan before you as one which
Socialism depends upon, which must be adopted. I do not say that the
Socialist parties of the world are pledged to this method, for they are
not. The subject is not mentioned in any of our programmes, so far as I
recall them at this moment. We are silent upon the subject, not because
we fear to discuss it, but because we realize that the matter will be
decided when the question is reached, and that each case will be decided
upon its merits. Still, it is but fair to express my belief that it is
to the interest of the workers, no less than of the rest of society,
that the change to a Socialist state be made as easy and peaceable as
possible. Socialists, being human beings and not monsters, naturally
desire that the transition to Socialism shall be made with as little
friction and pain as possible. Left to their own choice, I am confident
that those upon whom the task of effecting the change falls will not
choose the way of violence, if the way of peace is left open to them.

Within the limits of this opportunity, I have tried to be as frank as I
am to myself in those constant self-questionings which are inseparable
from the work of the serious propagandist and honest teacher. Further I
cannot go. If I have not been able to tell definitely how the change
_will_ be wrought, I have at least been able, I hope, to show that it
_may_ be brought about peaceably and without bloodshed. If this has
given any one a new view of Socialism--opened, as it were, a doorway
through which you can get a glimpse of the City Beautiful, and the way
leading to its gates--then my reward is infinitely precious.


[197] From the stenographic report of an address given to some students
of Socialism in New York, October, 1907.

[198] Cf. Jaurès, _Studies in Socialism_, page 44.

[199] Quoted by Jaurès, _Studies in Socialism_, page 93.

[200] The reader is referred to Kautsky's books, _Das Erfurter Program_
and _The Social Revolution_, and to Vandervelde's admirable work,
_Collectivism_, for confirmation of this statement.

[201] Quoted by Vandervelde, _Collectivism_, page 155.


(Titles in Italics)


Abbé Lancellotti, quoted, 27-28.

_Abuses of Injunctions, The_, 196 n.

_A Contribution to the Critique of Political Economy_, 93, 202, 206,
  212, 245 n.

Adams, Mr. Brooks, 156.

Adler, G., 64 n.

  American investments in, 118;
  cannibalism in, 78;
  Moors in, 95;
  slavery in, 26.

Agriculture, concentration in, 121, 131-137.

Aix-la-Chapelle, conference of sovereigns at, 49.

_A Lecture on Human Happiness_, 206.

_A Letter to Lord John Russell_, 206.

"Alfred" (Samuel Kydd), quoted, 23.

Alliance de la Democratie Socialiste, the, 69 n.

Amalgamated Association of Iron and Steel Workers, the, 195.

Amalgamated Society of Railway Servants, the, 197.

  class divisions and struggles in, 163-169, 176-178, 182-184, 192-197;
  concentration of wealth in, 124-150;
  discovery of, 94-97;
  first cotton from, used in England, 30-31;
  foreign capital invested in, 118;
  Socialism in, 4, 167.
  _See also_ UNITED STATES.

American Association for the Advancement of Science, 146.

_American Farmer, The_, 136 n., 168 n., 306 n.

_American Federationist, The_, 13 n.

American Federation of Labor, 183.

American Railway Union, the, 194.

American Revolution, the, 79.

_A Modest Inquiry into the Nature and Necessity of a Paper Currency_,

  Socialism and, 2;
  weak where Socialism is strong, 181.

Anaximander, 232.

_Ancient Society, or Researches in the Lines of Human Progress_, 97 n.,
  102 n.

_An Inquiry concerning Political Justice_, 204.

_An Inquiry into the Principles of the Distribution of Wealth_, 204.

Anstey, Mr., satire on Socialist régime, 281.

Anthracite coal strike, 1903, 174.

_Arena, The_, 196 n.

_A Report on Labor Disturbances in the State of Colorado_, etc., 174 n.

Argyles, relation of Mrs. Marx to the, 66.

Aristotle, 81.

Arkwright, English inventor, 19.

  American capital invested in, 118;
  savages in Central, 95;
  supposed origin of feudalism in, 106.

Atheism, Marx and, 69, 70 n.

Athens, 104.

_A Treatise on Taxes and Constitutions_, 244 n.

_Aus dem literarischen Nachlass von Karl Marx, Friederich Engels,
  und Ferdinand Lassalle_, 64 n.

Australia, American capital invested in, 118.

_Austrian Labor Almanac, The_, 66 n.

"Austrian" school of economists, the, 257.

Aveling, Edward, 93 n., 210 n.;
  Eleanor Marx, 210 n., 212.


Bachofen, 101.

Baden, concentration of wealth in, 140-142.

Bakeshops, concentration of ownership of, 124.

Bakunin, Michael, 66, 69 n., 88.

Bantu tribes of Africa, 102.

Bax, E. Belfort, 61 n., 67 n., 93 n.

Beaulieu, Leroy, 141.

Beer, M., 87 n.

Bellamy, Edward, 9.

Bernstein, Edward, 139, 203, 204 n.

Bigelow, Melville, 156 n.

Bismarck, Marx and, 92.

"Blacklisting," 173.

Blanc, Louis, 12.

Bolte, letter from Marx to, 88 n.

Bookstaver, Justice, 196.

Bootblacks, 127.

Bray, John Francis, 203, 207.

_Briefe und Auszüge aus Briefen von Joh. Phil. Becker_, etc., 120.

Brisbane, Albert, 55.

British Museum, Marx and the, 209, 210, 213.

Brook Farm, 53.

Brooks, George, 69 n.

Buffalo _Express_ strike, 196.


Cabet, Étienne, 54, 57-60, 231.

California, cost of growing wheat in, 131.

Call, Henry Laurens, 146.

Campanella, 9.

Cannibalism, 78, 102, 103.

  dedication of, 208;
  English character of, 213-214;
  Liebknecht on, 209;
  quoted, 28, 29, 87, 93 n., 115, 206, 228 n., 239, 274, 275;
  relation of to Socialism, 119.

  nature of, 236;
  Socialists advocate abolition of, 237.

_Capitalist and Laborer_ (Spargo), 259 n., 284 n.

Capitalist income, the source of, 266 _et seq._

Carlyle, Thomas, quoted, 217, 302.

Cartwright, English inventor, 20.

Casalis, African missionary, quoted, 77.

_Case for the Factory Acts, The_, 310.

_Centralization and the Law: Scientific Legal Education_, 156 n.

_Chansons Revolutionaire_, 325.

_Charles Darwin and Karl Marx, A Comparison_, 93 n.

Chartism and Chartists, 53, 67, 203.

Chase, Salmon P., 45.

Chicago, trial of E. V. Debs at, 194.

Child Labor, 21-26, 31, 39.

Children, feeding of school, 321.

China, Socialism in, 71.

  embraced by Heinrich Marx, 63-65;
  Marx and, 68-70;
  Roman Empire and, 89;
  Robert Owen and, 51.

_Christianity and the Social Crisis_, 86 n.

Cigar stores, concentration of ownership of, 124.

Civil War, the, 85.

_Claims of Labour and Capital Conciliated, The_, 204.

_Clansmen, The_, 158.

_Clarion, The_, 7 n.

Class consciousness, 151, 165;
  President Roosevelt on, 151, 180;
  Robert Owen and, 48-49;
  Weitling and, 56.

  of capitalism, 157 _et seq._;
  of feudalism, 156;
  of slavery, 155;
  of the United States, 163 _et seq._;
  ultimate end of, by Socialism, 200.

Class environment, influence of, on beliefs, etc., 171-175.

Class struggle theory, the, 155 _et seq._

Cleveland, President, 194.

Clodd, Edward, quoted, 76, 82 n.

_Coal Mine Workers, The_, 160 n.

Coeur d'Alene, 183, 192.

Coleridge, Robert Owen and, 31.

_Collectivism_, 306 n.

Cologne assizes, Marx tried at, 208.

Colorado, labor troubles in, 174, 192.

Columbus and the discovery of America, 94-97.

_Coming Slavery, The_, 6, 282.

Commercial crisis in England, 1815, 39-41.

  definition of a, 236, 239-241;
  labor power as a, 263 _et seq._;
  money as a, 255-256;
  sunshine called a, 241 n.;
  value of a, determined by labor, 243-254.

_Common Sense of Socialism, The_, (Spargo), 168.

Communism, political, 13, 14, 15, 54, 55;
  primitive, 97, 101-102.

Communist League, the, 60, 61.

_Communist Manifesto, The_:
  birth-cry of modern Socialism, 53;
  joint authorship of, 62, 73-74;
  publication of, 62;
  quoted, 71, 72, 73, 153-154;
  summary of, by Engels, 72;
  taxation of land values advocated in, 268 n.

Compensation, Socialism and, _see_ CONFISCATION.

Competition, 98-101, 114, 115, 148, 149.

_Comrade, The_, 10 n., 68 n.

Concentration of capital and wealth, the, 115 _et seq._

_Condition of the Working Class in England in 1844, The_, 67, 74.

Confiscation of property, Socialism and, 331, 333-337.

Constitution, the, and Socialism, 329-330.

Consumer, exploitation of the, 189.

Cooke-Taylor, R. W., 23 n., 24.

Coöperation, among animals, 98, 99;
  Owen and, 45;
  under Socialism, 299, 300, 305.

_Corn-Law Rhymes, The_, 1.

Cossa, Luigi, quoted, 215.

Cotton manufacture in England, 29 _et seq._;
  Engels and, 67.

Credit functions in Socialist régime, 300-302.

Crimean War, the, 36-38, 232.

Cripple Creek, 174 n., 183.

_Criticism of the Gotha Programme_, 205, 224.

Crompton, English inventor, 19.

Cromwellian Commonwealth, the, 114.


Dale, David, 24.

Dante, Marx and, 68.

  appreciation of his work by Marx, 93;
  compared to Marx, 73, 93;
  letter from, to Marx, 93;
  on the struggle for existence, 98;
  quoted, 98.

_Das Erfurter Program_, 279 n., 305 n., 315 n.

_Das junge Deutschland in der Schweiz_, 70 n.

Davenay, M., letter from Herbert Spencer to, 6.

Debs, E. V., 193, 194.

  application of principles of, to industry in Socialist régime, 287,
  only approximately attainable, 288-289;
  Socialism and, 287-290, 302-305, 329-330.

_Descent of Man, The_, 98.

Deville, Gabriel, quoted, 237.

Diary of Mrs. Marx quoted, 211-212.

_Die Agrarfrage_, 168 n., 297 n., 306 n.

_Die Bauernfrage in Frankreich und Deutschland_, 306.

_Die Grundlagen der Karl Marx'schen Kritik der bestehenden
  Volkswirthschaft_, 64.

_Die Neue Zeit_, 64 n.

_Die Voraussetzungen des Socializmus_, 139.

Directive ability, 228 n., 273-275.

Direct legislation, 289, 329-330.

_Directory of Directors, The_, 117.

_Disclosures about the Communists' Process_, 61.

Drinkwater, partner of Robert Owen, 29-31.


_Eastern Question, The_, 210 n., 212 n.

_Economic Foundations of Society, The_, 87 n.

_Economic Interpretation of History, The_ (Rogers), 94 n., 95 n.

_Economic Interpretation of History, The_ (Seligman), 81 n., 82 n.,
  83 n., 85 n., 91 n.

_Economic Journal, The_, 198 n.

_Economics of Socialism, The_, 38 n., 257 n.

_Economic Writings of Sir William Petty, The_, 215 n.

Edison, 227.

_Effects of Civilization on the People of the European States, The_,

_Eighteenth Brumaire, The_, 90.

_Elements of Political Economy_ (Nicholson), 241 n.

Elliott, Ebenezer, quoted, 1.

Ely, Professor R. T., 46, 115, 132, 140;
  quoted, 79, 138, 148.

Emerson, R. W., on Robert Owen, 50-52.

  birth and early training, 66-67;
  collaboration with Marx in authorship of _Manifesto_, 62;
  first meeting with Marx, 67;
  friendship with O'Connor and Owen, 67;
  his _Condition of the Working Class in England in 1844_, 67;
  joins International Alliance with Marx, 61;
  life in England, 67;
  linguistic abilities, 67;
  journalistic work, 67;
  poem on, 74;
  quoted, 17, 54, 73-74, 91, 105, 120, 153-154, 186, 306 n., 334-335;
  share in authorship of _Manifesto_, 73;
  views upon confiscation of capitalist property, 335.

England, industrial revolution in, 19 _et seq._;
  Social Democratic Federation of, 283-284;
  trade unions in, 45, 197-199.

Ensor, R. C. K., 283, 306 n.

Equality, Socialists and, 2, 312, 316.

Eskimos, the, 102.

_Essai sur la repartition des richesses et sur la tendance à une moindre
  inégalité des conditions_, 141 n.

_Essay on Robert Owen_, 50 n.

_Essays on the Formation of Human Character_, 34.

_Ethics and the Materialistic Conception of History_, 171 n.

Europe, growth of Socialism in, 4.

Everet's wool-dressing machine, 27.


_Fabian Tracts, The_, 124 n., 144 n.

_Factory System and the Factory Acts, The_, 24.

Family, _see_ Marriage.

Farmers, class interests of, 164, 166-169.

Farms, mortgages and ownership of, 133-134;
  number of, in United States, 133;
  permanence of small, 134;
  under Socialism, 128 n.

Ferdinand and Isabella, 95.

_Ferdinand Lassalle as a Social Reformer_, 204 n.

Ferri, Enrico, 78, 93 n.

Feudalism, duration of, 107;
  nature of, 108-110;
  origin of, 106-107;
  theory of, 108.

Feuerbach, Ludwig, 89.

_Feuerbach, the Roots of the Socialist Philosophy_, 86 n., 89 n.

_Figaro, The_, 6.

"Final Utility" theory of value, the, 257.

Fourier, Charles, 32, 46, 48, 50, 54, 231.

Foxwell, Professor, 206, 207 n.;
  quoted, 206.

France, concentration of wealth in, 141.

Franklin, Benjamin, 244, 245, 307;
  estimate of, by Marx, 245 n.;
  his views upon value, 245;
  quoted, 245.

Freeman, Justice, 195.

"Free Soil" movement, the, 57.

Freiligrath, F., 208.

_French and German Socialism_, 46 n.


Garrison, W. Lloyd, 85.

Garwood, John, poem by, quoted, 35.

Gentz, M., 49.

George, Henry, 268 n.

German Socialists in America, F. Engels on, 120.

  Anarchism weak in, 181;
  ribbon loom invented in, 27;
  Socialism in, 167;
  use of loom in, forbidden, 28.

_Geschichte der deutschen Sozialdemokratie_, 64 n.

Ghent, W. J., 32, 83, 124, 171 n., 178;
  quoted, 175.

Gibbins, H. de B., quoted, 21, 22, 26.

Giddings, Professor F. H., quoted, 310.

Giffen, Sir Robert, 143.

Gildersleeve, Justice, 196.

Glasgow, conference of manufacturers in, 39.

_God's England or the Devil's?_ 69 n.

Godwin, William, 203, 204.

Gompers, Samuel, quoted, 13 n.

Gossen, 257 n.

Gotha Programme of German Socialist Party, 205, 224, 229.

Gray, John, 203, 206.

Green, J. Richard, 79.

_Growth of Monopoly in English Industry, The_, 124 n.

_Guaranties of Harmony and Freedom, The_, 55.

_Guide to the Study of Political Economy_, 215.


Hall, Charles, 203.

Hall, Professor Thomas C., 89 n.

Hamburg, loom publicly burned in, 28.

Hanna, Marcus A., 183.

Hargreaves, English inventor, 19.

Harrington, 82.

Hazelton and Homestead, 183.

Heath, Frederic, 55 n.

Hebrews, religious conceptions of the, 86.

Heine, Heinrich, 66.

_Herr Vogt_, 61.

Hillquit, Morris, 46 n., 228 n.;
  quoted, 55-57.

_History and Criticism of the Labor Theory of Value_, 205 n.

_History of Socialism_, 46 n.

_History of Socialism in the United States_, 46 n., 55 n.

_History of the Factory System_, 23.

Hobbes, 261.

Hodgskin, Thomas, 203, 207.

Hull, Henry, 215 n.

Huxley, Professor, 77, 98.

Hyndman, H. M., 38 n., 257 n.


Ibsen, 15.

Icaria, 59.

Idaho, class struggle in, 183, 192.

Immigration, 127 n.

Individualism, Socialism and, 280.

_Industrial History of England, The_, 21 n., 22 n., 26 n.

Industrial revolution in England, the, 19 _et seq._

Ingalls, Senator John J., 148.

Initiative and Referendum, the, 289, 329-330.

Injunctions in labor disputes, 193 _et seq._

International Alliance, the, 61.

International Cigarmakers' Union, 195.

_International Socialist Review, The_, 11, 88 n., 224 n.

International Typographical Union, 196.

Iron Law of Wages, the, 262-265.

Isaiah, quoted, 9.


Jaurès, Jean, 306 n., 327 n., 328 n.

_Jesus Christ and the Social Question_, 69 n.

Jevons, Professor W. S., 257 n.

Jones, Lloyd, biographer of Owen, 19.

Jones, Owen's first partner, 29.

_Justice_ (London), 61 n., 67 n.


_Karl Marx: Biographical Memoirs_, 17 n., 64 n., 66 n., 93 n., 209 n.,
  212 n.

_Karl Marx's Nationaloekonomische Irrlehren_, 92 n.

Karl Marx on Sectarianism and Dogmatism, 88 n.

Kautsky, Karl, 66 n., 171 n., 297 n., 305 n., 306 n., 324 n.;
  quoted, 128, 168.

Kipling, Rudyard, quoted, 96.

Kirkup, Thomas, 46 n.

Kropotkin, Peter, 99, 100, 285, 286 n.

Kydd, Samuel ("Alfred"), 23 n.


Labor, defined by Mallock, 228-229;
  by Marx, 228.

_Labor Defended against the Claims of Capital_, 206.

_Labor History of the Cripple Creek District_, 174 n.

Labor Notes, 314.

Labor-power, a commodity, 263 _et seq._;
  determines value, 243-254.

_Labour and Capital; a Letter to a Labour Friend_, 284 n.

_Labour's Wrongs and Labour's Remedy_, 207.

_La Conquête du pain_, 286 n.

Lafargue, Paul, 128 n., 297 n.

Lamarck, 72.

_La Misère de la Philosophie_, 201, 203 n.

Land, ownership of, under Socialism, 297;
  under tribal communism, 72, 97.

_La Philosophie de la Misère_, 201.

Lassalle, Ferdinand, 64 n., 204 n., 225, 262-263, 264, 265.

Lauderdale, Lord, 49, 257.

_Lectures on the Nature and Use of Money_, 206.

Lee, Algernon, quoted, 172, 275.

Leibnitz, 64, 77;
  quoted, 76.

Leslie, John ("J. L."), quoted, 74 n.

_L'État Socialiste_, 315.

Liebknecht, W., 64 n., 66 n., 212 n.;
  quoted, 17, 93, 209, 327-328.

_Life of Francis Place_, 207 n.

_Life of Robert Owen_ (anonymous), 30 n.

Lincoln, Abraham, 43-44.

Lloyd, W. F., 257 n.

Locke, 64.

Lockwood, George Browning, 39 n., 41 n.

London, Jack, 182 n.

Lothrop, Harriet E., 224 n.

Lovejoy, 85.

Lubbock, Sir John, 101.

Luddites, the, 26, 36.

Luther, Martin, 80, 88.

Lyell, 77.


Macdonald, J. R., 225.

Machinery, introduction of, 19, 20, 26-29.

Machinists' Union sued, 198.

McMaster, 79.

Macrosty, H. W., 124.

Maine, Sir Henry, 101.

Mallock, W. H., 119, 221, 222, 223, 224, 226, 227, 228, 230, 274, 275.

Malthus, 98.

Marr, Wilhelm, 70 n.

Marriage, Socialism and, 292-293.

  birth and early life, 63-65;
  _Capital_ written in London, 209;
  collaborates with Engels, 62, 73;
  conversion to Socialism, 68-70;
  correspondent for New York _Tribune_, 210;
  death, 213;
  domestic felicity, 212-213;
  edits _Rhenish Gazette_, 65, 67;
  expelled from different countries, 209;
  finds refuge in England, 209;
  first meeting with F. Engels, 67;
  his attacks upon Proudhon, 201-202;
  his obligations to the Ricardians, 203;
  his surplus value theory, 203, 205, 206, 266-270;
  in German revolution of 1848, 208;
  Jewish ancestry, 63-64;
  marriage, 65-66;
  mastery of art of definition, 217;
  misrepresentation by Mallock of his views, 221-230;
  opposes Bakunin, 69-70;
  parents' religious beliefs, 64-65;
  poverty, 210-212;
  quoted, 27, 28, 29, 61, 86, 87, 89, 90, 93, 115, 191, 202, 217, 236,
  239, 245 n., 263, 274, 275, 327, 334-335;
  related to Argyles through marriage, 66;
  scientific methods of, 231-234;
  spiritual nature of, 68-70;
  starts _New Rhenish Gazette_, 208;
  views on confiscation of capitalist property, 334-335;
  views on Social Revolution, 326-327.

_Mass and Class_, 83 n., 171 n., 175 n., 178 n.

Massey, Gerald, quoted, 52 n.

Mayo-Smith, Richmond, 142, 143.

Mazzini, G., 60.

Mehring, Franz, 64 n., 224 n.

Menger, Dr. Anton, 203, 205, 206 n., 207 n.

_Message to Congress_, 177.

Methodism, 89.

Middle Ages, the, 107.

Mill, John Stuart, 216, 217, 227, 242.

Mitchell, John, 183;
  quoted, 193.

_Modern Socialism_ (Ensor), 306 n.

_Modern Socialism_ (Spargo), 259 n.

Money, as a commodity, 255-256;
  various articles used as, 255.

Money, Chiozza, M.P., 144.

Monopoly, 115, 116, 149, 258, 259.

More, Sir Thomas, 9, 58, 59.

Morgan, J. P., 179.

Morgan, Lewis H., 97, 101, 102 n.

Morris, William, quoted, 2, 20.

_Mutual Aid a Factor of Evolution_, 99 n., 100 n.


Napoleon, 114, 250.

National Association of Manufacturers, the, 183.

National Civic Federation, the, 183, 222 n.

_Natural and Artificial Right of Property Contrasted, The_, 206-207.

"New Christianity" of Saint-Simon, the, 68.

New Harmony, 43, 44, 45, 51.

_New Harmony Communities, The_, 39 n., 41 n.

New Lanark, 31-34, 41, 50.

_New Moral World, The_, 11.

Newton, Sir Isaac, 152.

Newton, Wales, 45.

New York _Sun_, the, 196.

Nicholson, Professor J. S., 241 n.

_Northern Star, The_, 67.

Norway, 2.

_Notes on Feuerbach_, 86 n.


_Oceana_, 82.

_Organized Labor_, 183 n.

_Origin of Species, The_, 72.

_Origin of the Family, Private Property, and the State, The_, 105.

_Our Benevolent Feudalism_, 124.

  advises Cabet, 60;
  as cotton manufacturer, 29-34;
  at Aix-la-Chapelle, 49;
  Autobiography of, 24 n.;
  becomes Socialist, 41;
  begins agitation for factory legislation, 31;
  biography of, 19;
  dying words of, 50;
  Emerson's view of, 50-52;
  Engels' estimate of, 17;
  establishes infant schools, 32;
  first to use word "Socialism," 11;
  founder of coöperative movement, 45;
  his failure, 45;
  improves spinning machinery, 30;
  Liebknecht on, 17;
  Lincoln and, 43-44;
  New Harmony, 43-45;
  New Lanark, 31-34;
  presides over first Trade Union Congress, 45;
  proposes establishment of communistic villages, 41;
  quoted, 24, 25, 34, 35, 37-38, 39-41;
  scepticism of, 18;
  speech to manufacturers, 39-41;
  views on crisis of 1815, 37;
  views of Fourier's ideas, 50.

Owen, Robert Dale, letter of, to Lincoln, 44.

Owenism, synonymous with Socialism, 11.


Peabody, Professor, 69 n.

Peel, Sir Robert, 31.

Petty, Sir William, 214, 215, 242, 244;
  quoted, 215, 216, 243-244.

_Pioneers of Evolution from Thales to Huxley_, 76 n., 82 n.

Place, Francis, 207.

Plato, 9.

Podmore, Frank, 19 n.

_Political Economy_ (Senior), 214 n.

_Poverty of Philosophy, The_, 201 n.

_Present Distribution of Wealth in the United States, The_, 144 n.

Price, an approximation of value, 254 _et seq._

Prices and Wages, 189.

_Principles of Economics_ (Seligman), 259 n.

_Principles of Political Economy and Taxation_, 246 n., 249 n., 262 n.

_Principles of Sociology, The_, 286 n., 313-314 n.

Private property, origin of, 97, 102-103;
  transformation to social, 331-337;
  under the Socialist régime, 128, 296-300, 316-317.

Protestant Reformation, the, 80, 114.

Proudhon, P. J., 66, 201, 202.

Pullman Strike, the, 193-194.


_Quarterly Journal of Economics, The_, 15.

Quelch, II., 201 n.


Rappites, the, 45.

Rastall, Benjamin McKie, 174 n.

Rauschenbusch, Professor, 86.

Referendum, the, 289, 329-330.

_Reformateurs Modernes_, 11.

_Remarks and Facts relative to the American Paper Currency_, 245 n.

_Reminiscences of Karl Marx_, 68 n.

Rent of Ability, the, 273-275.

_Report of the Royal Commission on Labour_, 70 n.

_Republic, The_, 12.

Republican Party, the, 2, 312 n.

Revisionism, 132.

_Revolution and Counter-Revolution_, 210, 212 n.

_Revolution in Mind and Practice, The_, 49 n.

Revolution of 1848, 208.

_Revue Politique et Parliamentaire_, 128, 297 n.

Reybaud, L., 11.

Ricardians, the, 202-208, 229, 242.

Ricardo, David, 205, 214, 215, 216, 217, 227, 242, 245, 246, 247, 248,
  quoted, 245-246, 262.

_Riches and Poverty_, 144.

_Right to the Whole Produce of Labour, The_, 205 n., 206 n., 207 n.

Riley, W. Harrison, 68 n.

Rockefeller, John D., 179.

Rogers, Thorold, 83, 84, 94 n., 95 n.

Roosevelt, President, 151, 180, 312 n.;
  quoted, 177.

Ruge, Arnold, 66.

Russell, Lord John, 206.


Sadler, Michael, 26 n.

Saint-Simon, 7, 9, 12, 46, 48, 231, 232.

Salt, H. S., 26 n.

San Francisco, disaster in, 158-159.

Sanial, Lucien, 129, 145.

Saxony, concentration of wealth in, 143.

Scarcity values, 249-250.

Schiller, quoted, 85.

Seabury, Judge, 196 n.

Seligman, Professor E. R. A., 81 n., 82, 83, 84, 85 n., 91, 259.

Senior, Nassau, 214.

_Shall the Unions go into Politics?_ 184 n.

Simons, A. M., 136, 168 n., 306 n.

Slonimski, Ludwig, 92 n.

Smith, Adam, 160, 206, 214, 215, 227, 242, 247;
  quoted, 161-162, 244.

Smith, Professor J. Allen, 289 n.

Smith, Professor Goldwin, 284.

_Social Democracy Red Book_, 55 n.

_Social Meaning of Modern Religious Movements in England, The_, 89 n.

  and assassination, 1, 3;
  coöperation under, 299, 300, 305;
  credit functions under, 300-302;
  definition of the word, 9;
  democracy essential to, 287-289;
  education under, 318-320;
  first use of the word, 10-11;
  freedom in religious, scientific, and philosophical matters under,
  freedom of the individual under, 284-287;
  in Europe, 4;
  in Germany, 4, 167, 181;
  in United States, 4, 167;
  inheritance of wealth under, 316-317;
  justice under, 318;
  labor and its reward under, 311-316;
  monopolies and, 115, 128, 148-150, 332-333;
  not opposed to individualism, 280 _et seq._;
  private property and industry under, 295-300, 335;
  realization of, 323 _et seq._;
  relation of the sexes under, 293;
  religion and, 291-292, 319;
  religious training of children and, 319-320;
  scientific character of, 231-234;
  Utopian and scientific compared, 42;
  wages under, 313-315;
  wealth under, 316-317, 335;
  women's suffrage and, 288, 329.

_Socialism_ (Macdonald), 225 n.

_Socialism_ (Mallock), 221 n.

_Socialism and Social Democracy_, 10 n.

_Socialism Inevitable_, 130, 131.

_Socialism Utopian and Scientific_, 35 n., 47 n., 48.

Socialist Party organizations among farmers, 167.

Social Revolution, the, 324-328.

_Social Revolution, The_, 128 n., 306 n., 315 n., 334 n.

Sombart, Professor Werner, 132.

_Some Neglected British Economists_, 257 n.

_Songs of Freedom_, 26 n.

Sorge, F. A., 120.

Spahr, Charles B., 144.

Spargo, John, 10, 168.

Spencer, Herbert, 6, 8, 282, 313-314 n.;
  quoted, 7, 286.

_Spirit of American Government, The_, 289 n.

Standard Oil group, the, 117.

_Statistics and Economics_, 142-143.

Stone, N. I., 245 n.

_Studies in Socialism_, 306 n., 327 n., 328 n.

_Studies in the Evolution of Industrial Society_, 79 n., 115 n., 138 n.,
  140 n., 148.

_Sun_, New York, the, 196.

  early uses of the term, 205, 206;
  the theory developed by Marx, 206, 266;
  the theory explained, 266-270;
  various theories of, 271-275.

Symonds, J. Addington, 322 n.


"Taff Vale law," 197-199.

Taxation as a means of achieving Socialism, 336-337.

Taxation of land values, 268 n.

Tendencies to socialization within existing state, 279, 330-331.

Texas, Cabet advised to experiment in, 60.

_The People's Marx_, 237 n.

_The Social System, a Treatise on the Principles of Exchange_, 206.

Thompson, William, 203, 204, 205.

Tolstoy, 15, 222.



Unionism, principles of labor, 184 _et seq._

United Mine Workers' Union, the, 159-160.

  classes in, 164-169, 176-179;
  concentration of wealth and capital in, 124-150;
  farms and farm mortgages in, 133-134;
  millionaires in, 146-148;
  Socialism in, 4, 167;
  strikes in, 182.

United States Steel Corporation, 138.


  and price, 254-259;
  early labor theory of, 242-252;
  Marxian theory of, 250-254;
  other theories of, 259.

_Value, Price, and Profit_, 263 n.

Vandervelde, Émile, 306 n., 315 n., 334 n., 335 n.

Vasco de Gama, 96.

Veblen, Professor Thorstein, quoted, 15.

_Volkstribun_, the, 57.


Wallace, Alfred Russell, 77, 81.

Wallas, G., 207.

_War of the Classes, The_, 182 n.

Warne, Frank Julian, 160 n.

Watt, James, 20, 227.

Wealth, defined, 217-221;
  inheritance of, under Socialism, 316-317, 335.

_Wealth of Nations, The_, 160, 162 n., 206 n., 213, 244 n., 249 n.

Webb, Mrs. Sidney, 310.

Weitling, Wilhelm, 14, 54, 55, 56, 57.

Whitaker, Dr. A. C., 205 n.

Wilshire, Gaylord, 130 n., 131 n.

Wolf, Wilhelm, 208.

_Worker, The_, 172, 275.

_World as it is, and as it might be, The_, 55.

Wright, Carroll D., 174 n.

_Writings and Speeches of John J. Ingalls_, 148 n.


Youmans, Professor, 77.


Zola, Émile, 15.


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