John Morley - "Critical Miscellanies (Vol 3 of 3)"

David Livingstone - "The Last Journals of David Livingstone, in Central Africa, from 1865 to His Death, Volume II (of 2), 1869 1873"

Randall Parrish - "Beth Norvell"

Christina Rossetti - "Goblin Market, The Prince's Progress, and Other Poems"

William Hurrell Mallock - A Critical Examination of Socialism

W >> William Hurrell Mallock >> A Critical Examination of Socialism



A CRITICAL EXAMINATION OF SOCIALISM

by

W.H. MALLOCK







London
John Murray, Albemarle Street, W.
1908
Printed by
Hazell, Watson and Viney, Ld.,
London and Aylesbury.





PREFACE


The Civic Federation of New York, an influential body which aims, in
various ways, at harmonising apparently divergent industrial interests
in America, having decided on supplementing its other activities by a
campaign of political and economic education, invited me, at the
beginning of the year 1907, to initiate a scientific discussion of
socialism in a series of lectures or speeches, to be delivered under the
auspices of certain of the great Universities in the United States. This
invitation I accepted, but, the project being a new one, some difficulty
arose as to the manner in which it might best be carried out--whether
the speeches or lectures should in each case be new, dealing with some
fresh aspect of the subject, or whether they should be arranged in a
single series to be repeated without substantial alteration in each of
the cities visited by me. The latter plan was ultimately adopted, as
tending to render the discussion of the subject more generally
comprehensible to each local audience. A series of five lectures,
substantially the same, was accordingly delivered by me in New York,
Cambridge, Chicago, Philadelphia, and Baltimore. But whilst this plan
secured continuity of treatment, it secured it at the expense of
comprehensiveness. Certain important points had to be passed over. In
the present volume the substance of the original lectures has been
entirely rearranged and rewritten, and more than half the matter is new.
Even in the present volume, however, it has been impossible to treat the
subject otherwise than in a general way. At almost every point a really
complete discussion would necessitate a much fuller analysis of facts
than it has been practicable to give here. Arguments here necessarily
confined to a few pages or to a chapter, would each, for their complete
elucidation, require a separate monograph. Most readers, however, will
be able to supply much of what is missing, by the light of their own
common sense; and general arguments, in which, as in block plans of
buildings, many details are suppressed, have for practical purposes the
great advantage of being generally and easily intelligible, whereas, if
stated in fuller and more complex form, they might confuse rather than
enlighten a large number of readers.

The fact that the fundamental arguments of this volume were
disseminated throughout the United States, not only at the meetings
addressed, but also in all the leading newspapers, has had the valuable
result, by means of the mass of criticisms which they elicited, of
illustrating the manner in which socialists attempt to meet them; and
has enabled me to revise, with a view to farther clearness, certain
passages which were intentionally or unintentionally misunderstood, and
also to emphasise the curious confusions of thought into which various
critics have been driven in their efforts to controvert or get round
them. I may specially mention a small volume by Mr. G. Wilshire of New
York--a leading publisher and disseminator of socialistic
literature--which was devoted to examining my own arguments seriatim. To
the principal criticisms of this writer allusions will be found in the
following pages. Most of my socialistic opponents (though to this rule
there were amusing exceptions) wrote, according to their varying degrees
of intelligence and education, with remarkable candour, and also with
great courtesy. Mr. Wilshire, in particular, whilst seeking to refute my
arguments as a whole, admitted the force of many of them; and did his
best, in his elaborate _resume_ of them, to state them all fairly.

The contentions, and even the phraseology of socialists are in all
countries (with the possible exception of Russia) identical. All are
vitiated by the same distinctive errors, and it is indifferent whether,
for purposes of detail criticism, we go to speakers and writers in this
country or America. Except for the correction of a few verbal errors
which have escaped my notice in the American edition, and which obscure
the meaning of perhaps four or five sentences, for the introduction of a
few additional notes, and for the translation of dollars and cents into
pounds and shillings, the English and the American editions are the
same.

W. H. M.

_January, 1908._




CONTENTS


CHAPTER I

THE HISTORICAL BEGINNING OF SOCIALISM AS AN OSTENSIBLY
SCIENTIFIC THEORY

Socialism an unrealised theory. In order to discuss it, it must
be defined.

Being of no general interest except as a nucleus of some general
movement, we must identify it as a theory which has united large
numbers of men in a common demand for change.

As the definite theoretical nucleus of a party or movement,
socialism dates from the middle of the nineteenth century, when
it was erected into a formal system by Karl Marx.

We must begin our examination of it by taking it in this, its
earliest, systematic form.


CHAPTER II

THE THEORY OF MARX AND THE EARLIER SOCIALISTS SUMMARISED

The doctrine of Marx that all wealth is produced by labour.

His recognition that the possibilities of distribution rest on
the facts of production.

His theory of labour as the sole producer of wealth avowedly
derived from Ricardo's theory of value.

His theory of capital as consisting of implements of production,
which are embodiments of past labour, and his theory of modern
capitalism as representing nothing but a gradual abstraction by
a wholly unproductive class, of these implements from the men
who made them, and who alone contribute anything to their
present productive use.

His theory that wages could never rise, but must, under
capitalism, sink all over the world to the amount which would
just keep the labourers from starvation, when, driven by
necessity, they will rebel, and, repossessing themselves of
their own implements, will be rich forever afterwards by using
them for their own benefit.


CHAPTER III

THE ROOT ERROR OF THE MARXIAN THEORY.
ITS OMISSION OF DIRECTIVE ABILITY.
ABILITY AND LABOUR DEFINED

The theory of Marx analysed. It is true as applied to primitive
communities, where the amount of wealth produced is very small,
but it utterly fails to account for the increased wealth of the
modern world.

Labour, as Marx conceived of it, can indeed increase in
productivity in two ways, but to a small degree only, neither of
which explains the vast increase of wealth during the past
hundred and fifty years.

The cause of this is the development of a class which, not
labouring itself, concentrates exceptional knowledge and energy
on the task of directing the labour of others, as an author does
when, by means of his manuscript, he directs the labour of
compositors.

Formal definition of the parts played respectively by the
faculties of the labouring and those of the directing classes.


CHAPTER IV

THE ERRORS OF MARX, CONTINUED.
CAPITAL AS THE IMPLEMENT OF ABILITY

Two kinds of human effort being thus involved in modern
production, it is necessary for all purposes of intelligible
discussion to distinguish them by different names.

The word "labour" being appropriated by common custom to the
manual task-work of the majority, some other technical word must
be found to designate the directive faculties as applied to
productive industry. The word here chosen, in default of a
better, is "ability."

Ability, then, being the faculty which directs labour, by what
means does it give effect to its directions?

It gives effect to its directions by means of its control of
capital, in the form of wage-capital.

Ability, using wage-capital as its implement of direction, gives
rise to fixed capital, in the form of the elaborate implements
of modern production, which are the material embodiments of the
knowledge, ingenuity, and energy of the highest minds.


CHAPTER V

REPUDIATION OF MARX BY MODERN SOCIALISTS.
THEIR RECOGNITION OF DIRECTIVE ABILITY

The more educated socialists of to-day, when the matter is put
plainly before them, admit that the argument of the preceding
chapters is correct, and repudiate the doctrine of Marx that
"labour" is the sole producer.

Examples of this admission on the part of American socialists.

The socialism of Marx, however, still remains the socialism of
the more ignorant classes, and also of the popular agitator.

It is, moreover, still used as an instrument of agitation by
many who personally repudiate it. The case of Mr. Hillquit.

The doctrine of Marx, therefore, still requires exposure.

Further, it is necessary to understand this earlier form of
socialistic theory in order to understand the later.


CHAPTER VI

REPUDIATION OF MARX BY MODERN SOCIALISTS, CONTINUED.
THEIR RECOGNITION OF CAPITAL AS THE IMPLEMENT OF DIRECTIVE
ABILITY.
THEIR NEW POSITION, AND THEIR NEW THEORETICAL DIFFICULTIES

The more educated socialists of to-day, besides virtually
accepting the argument of the preceding chapters with regard to
labour, virtually accept the argument set forth in them with
regard to capital.

Mr. Sidney Webb, for example, recognises it as an implement of
direction, the only alternative to which is a system of legal
coercion.

Other socialists advocate the continued use of wage-capital as
the implement of direction, but they imagine that the situation
would be radically changed by making the "state" the sole
capitalist.

But the "state," as some of them are beginning to realise, would
be merely the private men of ability--the existing
employers--turned into state officials, and deprived of most of
their present inducements to exert themselves.

A socialistic state theoretically could always command labour,
for labour can be exacted by force; but the exercise of ability
must be voluntary, and can only be secured by a system of
adequate rewards and inducements.

Two problems with which modern socialism is confronted: How
would it test its able men so as to select the best of them for
places of power? What rewards could it offer them which would
induce them systematically to develop, and be willing to
exercise, their exceptional faculties?


CHAPTER VII

PROXIMATE DIFFICULTIES.
ABLE MEN AS A CORPORATION OF STATE OFFICIALS

How are the men fittest for posts of industrial power to be
selected from the less fit?

This problem solved automatically by the existing system of
private and separate capitals.

The fusion of all private capitals into a single state capital
would make this solution impossible, and would provide no other.
The only machinery by which the more efficient directors of
labour could be discriminated from the less efficient would be
broken. Case of the London County Council's steamboats.

Two forms which the industrial state under socialism might
conceivably take: The official directors of industry might be
either an autocratic bureaucracy, or they might else be subject
to elected politicians representing the knowledge and opinions
prevalent among the majority.

Estimate of the results which would arise in the former case.
Illustrations from actual bureaucratic enterprise.

Estimate of the results which would arise in the latter case.
The state, as representing the average opinion of the masses,
brought to bear on scientific industrial enterprise.
Illustrations.

The state as sole printer and publisher. State capitalism would
destroy the machinery of industrial progress just as it would
destroy the machinery by which thought and knowledge develop.

But behind the question of whether socialism could provide
ability with the conditions or the machinery requisite for its
exercise is the question of whether it could provide it with any
adequate stimulus.


CHAPTER VIII

THE ULTIMATE DIFFICULTY.
SPECULATIVE ATTEMPTS TO MINIMISE IT

Mr. Sidney Webb, and most modern socialists of the higher kind,
recognise that this problem of motive underlies all others.

They approach it indirectly by sociological arguments borrowed
from other philosophers, and directly by a psychology peculiar
to themselves.

The sociological arguments by which socialists seek to minimise
the claims of the able man.

These founded on a specific confusion of thought, which vitiated
the evolutionary sociology of that second half of the nineteenth
century. Illustrations from Herbert Spencer, Macaulay, Mr. Kidd,
and recent socialists.

The confusion in question a confusion between speculative truth
and practical.

The individual importance of the able man, untouched by the
speculative conclusions of the sociological evolutionists, as
may be seen by the examples adduced in a contrary sense by
Herbert Spencer. This is partially perceived by Spencer himself.
Illustrations from his works.

Ludicrous attempts, on the part of socialistic writers, to apply
the speculative generalisations of sociology to the practical
position of individual men.

The climax of absurdity reached by Mr. Sidney Webb.


CHAPTER IX

THE ULTIMATE DIFFICULTY, CONTINUED.
ABILITY AND INDIVIDUAL MOTIVE

The individual motives of the able man as dealt with directly by
modern socialists.

They abandon their sociological ineptitudes altogether, and
betake themselves to a psychology which they declare to be
scientific, but which is based on no analysis of facts, and
consists really of loose assumptions and false analogies.

Their treatment of the motives of the artist, the thinker, the
religious enthusiast, and the soldier.

Their unscientific treatment of the soldier's motive, and their
fantastic proposal based on it to transfer this motive from the
domain of war to that of industry.

The socialists as their own critics when they denounce the
actual motives of the able man as he is and as they say he
always has been. They attack the typically able man of all
periods as a monster of congenital selfishness, and it is men of
this special type whom they propose to transform suddenly into
monsters of self-abnegation.

Their want of faith in the efficacy of their own moral suasion
and their proposal to supplement this by the ballot.


CHAPTER X

INDIVIDUAL MOTIVE AND DEMOCRACY

Exaggerated powers ascribed to democracy by inaccurate thinkers.

An example from an essay by a recent philosophic thinker, with
special reference to the rewards of exceptional ability.

This writer maintains that the money rewards of ability can be
determined by the opinion of the majority expressing itself
through votes and statutes.

The writer's typical error. A governing body might enact any
laws, but they would not be obeyed unless consonant with human
nature.

Laws are obliged to conform to the propensities of human nature
which it is their office to regulate.

Elaborate but unconscious admission of this fact by the writer
here quoted himself.

The power of democracy in the economic sphere, its magnitude and
its limits. The demands of the minority a counterpart of those
of the majority.

The demand of the great wealth-producer mainly a demand for
power.

Testimony of a well-known socialist to the impossibility of
altering the character of individual demand by outside
influence.


CHAPTER XI

CHRISTIAN SOCIALISM AS A SUBSTITUTE FOR SECULAR DEMOCRACY

The meaning of Christian socialism, as restated to-day by a
typical writer.

His just criticism of the fallacy underlying modern ideas of
democracy. The impossibility of equalising unequal men by
political means.

Christian socialism teaches, he says, that the abler men should
make themselves equal to ordinary men by surrendering to them
the products of their own ability, or else by abstaining from
its exercise.

The author's ignorance of the nature of the modern industrial
process. His idea of steel.

He confuses the production of wealth on a great scale with the
acquisition of wealth when produced.

The only really productive ability which he distinctly
recognises is that of the speculative inventor.

He declares that inventors never wish to profit personally by
their inventions. Let the great capitalists, he says, who merely
monopolise inventions, imitate the self-abnegation of the
inventors, and Christian socialism will become a fact.

The confusion which reigns in the minds of sentimentalists like
the author here quoted. Their inability to see complex facts and
principles, in their connected integrity, as they are. Such
persons herein similar to devisers of perpetual motions and
systems for defeating the laws of chance at a roulette-table.

All logical socialistic conclusions drawn from premises in which
some vital truth or principle is omitted. Omission in the
premises of the earlier socialists. Corresponding omission in
the premises of the socialists of to-day.

Origin of the confusion of thought characteristic of Christian
as of all other socialists. Temperamental inability to
understand the complexities of economic life. This inability
further evidenced by the fact that, with few exceptions,
socialists themselves are absolutely incompetent as producers.
Certain popular contentions with regard to modern economic life,
urged by socialists, but not peculiar to socialism, still remain
to be considered in the following chapters.


CHAPTER XII

THE JUST REWARD OF LABOUR AS ESTIMATED BY ITS ACTUAL PRODUCTS

Modern socialists admit that of the wealth produced to-day
labour does not produce the whole, but that some part is
produced by directive ability. But they contend that labour
produces more than it gets. We can only ascertain if such an
assertion is correct by discovering how to estimate with some
precision the amount produced by labour and ability
respectively.

But since for the production of the total product labour and
ability are both alike necessary, how can we say that any
special proportion of it is produced by one or the other?

J.S. Mill's answer to this question.

The profound error of Mill's argument.

Practically so much of any effect is due to any one of its
causes as would be absent from this effect were the cause in
question taken away. Illustrations.

Labour itself produces as much as it would produce were there no
ability to direct it.

The argument which might be drawn from the case of a community
in which there was no labour.

Such an argument illusory; for a community in which there was no
labour would be impossible; but the paralysis of ability, or its
practical non-existence possible.

Practical reasoning of all kinds always confines itself to the
contemplation of possibilities. Illustrations.

Restatement of proposition as to the amount of the product of
labour.

The product of ability only partially described by assimilating
it to rent.

Ability produces everything which would not be produced if its
operation were hampered or suspended.

Increased reward of labour in Great Britain since the year 1800.
The reward now received by labour far in excess of what labour
itself produces.

In capitalistic countries generally labour gets, not less, but
far more than its due, if its due is to be measured by its own
products.

It is necessary to remember this; but its due is not to be
measured exclusively by its own products.

As will be seen in the concluding chapter.


CHAPTER XIII

INTEREST AND ABSTRACT JUSTICE

The proposal to confiscate interest for the public benefit, on
the ground that it is income unconnected with any corresponding
effort.

Is the proposal practicable? Is it defensible on grounds of
abstract justice?

The abstract moral argument plays a large part in the
discussion.

It assumes that a man has a moral right to what he produces,
interest being here contrasted with this, as a something which
he does not produce.

Defects of this argument. It ignores the element of time. Some
forms of effort are productive long after the effort itself has
ceased.

For examples, royalties on an acted play. Such royalties herein
typical of interest generally.

Industrial interest as a product of the forces of organic
nature. Henry George's defence of interest as having this
origin.

His argument true, but imperfect. His superficial criticism of
Bastiat.

Nature works through machine-capital just as truly as it does in
agriculture.

Machines are natural forces captured by men of genius, and set
to work for the benefit of human beings.

Interest on machine-capital is part of an extra product which
nature is made to yield by those men who are exceptionally
capable of controlling her.

By capturing natural forces, one man of genius may add more to
the wealth of the world in a year than an ordinary man could add
to it in a hundred lifetimes.

The claim of any such man on the products of his genius is
limited by a variety of circumstances; but, as a mere matter of
abstract justice, the whole of it belongs to him.

Abstract justice, however, in a case like this, gives us no
practical guidance, until we interpret it in connection with
concrete facts, and translate the just into terms of the
practicable.


CHAPTER XIV

THE SOCIALISTIC ATTACK ON INTEREST AND THE NATURE OF ITS SEVERAL
ERRORS

The practical outcome of the moral attack on interest is
logically an attack on bequest.

Modern socialism would logically allow a man to inherit
accumulations, and to spend the principal, but not to receive
interest on his money as an investment.

What would be the result if all who inherited capital spent it
as income, instead of living on the interest of it?

Two typical illustrations of these ways of treating capital.

The ultimate difference between the two results.

What the treatment of capital as income would mean, if the
practice were made universal. It would mean the gradual loss of
all the added productive forces with which individual genius has
enriched the world.

Practical condemnation of proposed attack on interest.

Another aspect of the matter.

Those who attack interest, as distinct from other kinds of
money-reward, admit that the possession of wealth is necessary
as a stimulus to production.

But the possession of wealth is desired mainly for its social
results far more than for its purely individual results.

Interest as connected with the sustentation of a certain mode of
social life.

Further consideration of the manner in which those who attack
interest ignore the element of time, and contemplate the present
moment only.

Copyright (c) 2007. topmasterworks.com. All rights reserved.