The Pamphlet Collection of Sir Robert Stout: Volume 53
The Possible Future Developments of Governments in free states
The Possible Future Developments of Governments in free states.
I Propose to speak to-night of certain possible future developments in the Governments of free States. Perhaps it may form the best introduction to such a subject if I glance very briefly at the growth of Governments in civilized countries up to the present time. In doing so I will occupy but a few minutes whilst I sketch in the rudest outline the main features of that history with which, no doubt, you are all well acquainted;—and that only for the purpose of contrasting the condition under which Governments of the present day exist, with those of earlier periods.
It may be assumed that all government had its origin in the physical conditions of our nature—in the government of the father over his children; that it expanded into the patriarchal—the government by the head of a cluster of related households; that it further developed into the tribal, under the headship of the chief; and lastly consolidated into the national—the community of race, under the authority of the king. Under the chief or king in early times, the decisions of the ruling power, so far as they affected the action of the community, were often submitted to the assembled people, and were assented to or rejected by acclamation: and thus a rude democracy restrained in some fashion the will of the monarch. Personal equality of right was the rule where all were equally warriors. In this, however, there was one wide exception : for slavery appears amongst the earliest communities of which we have cognizance; and slavery arose from the conquest of feebler by stronger races. Slaves were chattels, not citizens; they had no existence in the polity of the State. Thus, even when Athens was at its greatest, and possessed a definite political constitution, and was perhaps the most perfect specimen of a democracy in ancient history, the slaves constituted a body which is said by some to have included nearly two-thirds page 4 of the whole population. It was a democracy in which two-thirds of the people were no part of the Demos. The kingly power was sometimes hereditary, sometimes elective, as custom had grown up in different communities: and sometimes it partook of both characters, being elective within the limits of the ruling family; often subject to disruption by the appearance of some man towering above his fellows in wisdom, courage and physical strength,—in all those attributes by which men acquire, by their own inherent character, the power to dominate over wills inferior to their own. Dynasties were changed by the Napoleons amongst mankind. Side by side with the kingly office grew up that of subordinate princes, who ruled each in his own territory, with power similar to that of the monarch; not unfrequently disputing and restraining his authority, and sometimes overshadowing the throne itself. A later period saw the growth of the political influence of the middle classes through the growing wealth and power of the towns; and a still later, the fall of the great feudatories, and the absorption of their power into that of the king; and from that epoch we trace the long struggle between the middle classes and the throne, to restrain the despotic power of the king within the limits of settled constitutional law. I say between the middle classes, because at the commencement of this struggle, the great mass of the people were little considered. There had been from time to time great popular outbursts of the lowest stratum of society, such as that of the Jacquerie in France, and the rising headed by Jack Cade in England; but as a rule it may be said the mass of the people had as little influence on the Government as the slaves had in Athens. But the last chapter in the history of government—a chapter not yet closed in many civilized countries—records the gradual extension to all classes of the community of a share in the councils of the State, and of the right of all to be bound by no laws except those to which they had signified their assent by the voice of their representatives in the popular assemblies.
The machinery of representation is of modern growth. It has been remarked by writers that there is little or no trace of such a contrivance in classical history; as little is there amongst oriental nations, or amongst those northern races from whom the civilized world has mainly sprung. The personal appeal to an assembled people could have been possible only in comparatively page 5 small communities. The delegation of political power to representatives was therefore the natural result of the enlargement of nationalities, combined with the sentiment of personal freedom handed down from the earliest traditions of a race. There have, however, been occasions when the contrivances of modern civilization have been utilized to enable a direct appeal to the masses of the people, without the intervention of representatives. Such we saw upon two occasions, when the late emperor of the French appealed to the people by means of a plebicitum, to confirm his power, first as president, and then as emperor. The machinery of the ballot-box rendered such an appeal possible. But that mechanism pre-supposes conditions which would have precluded success in earlier times. It involves a capacity to read and write in the majority of the people, and it requires that speedy circulation of intelligence which modern facilities, such as printing and rapidity of communication, have alone afforded. It involves above all, to insure success, such a standard of moral and political rectitude amongst the people, and such a submission to the requirements of the law, that the inviolability of the ballot-box shall be secured. We have introduced the same principle in this colony to a limited extent,—not indeed in the general Government, but in that of municipalities. We appeal by a plebicitum to the ratepayers, to sanction loans proposed to be raised by boroughs; and, more recently, we ascertain the wishes of the people on the subject of increasing or not increasing the number of public houses in a district.
It is clear that this extension of the principle of democracy is within the possibilities of the future in free Governments; and, in respect to one class of subjects, its utility and propriety will hardly be disputed. It has often been argued that the body entrusted with the duty of making laws for ordinary purposes of government is not necessarily clothed with the power of altering the fundamental principles of the Constitution. This position was taken by Mr. Grattan and those who opposed the union of Ireland with Great Britain; and constitutional lawyers of high position maintained the same view. The name of Lord Plunkett alone is sufficient authority for claiming great weight to the arguments adduced:—that a parliament elected by the people to make laws for their government cannot exceed the powers confided to it;—is incapable, morally and constitutionally, of putting an end to page 6 its own existence, and can, in the extreme case, but restore to the people the trust which the people confided to its hands. This important principle was asserted by the framers of the Constitution of the United States, the fifth article of which provides that any alteration in the Constitution shall be made only by a convention of the people, whose decisions become a part of the constitutional law, only after adoption by the legislatures of three-fourths of the States, or by conventions of three-fourth of the States, as Congress should determine; and the Constitution itself was only brought into force by being accepted by a convention in each of the thirteen States, elected for the sole purpose of determining, aye or no, the acceptance of the new Constitution. In England it has always been held that in the king, lords and and commons in parliament assembled are vested full power to alter the Constitution; but it has also been asserted that, where any fundamental alteration in the Constitution is proposed, parliament should be dissolved, and an election should take place with a special view to the determination of the question. Thus the people would, for all practical purposes, have been consulted, and legislation would proceed in compliance with their will. Still it can hardly be denied that a direct appeal to the people would be a more satisfactory method of asserting the principle, which is in fact admitted by the argument I have just noticed; and would relieve the Legislature from those long and violent discussions which always occur when any fundamental alteration in the Constitution of a State is proposed.
How far this process of appealing directly to the masses may become incorporated into the practice of Governments, it is impossible to speculate; still less to predicate what might be the results. I have gone no further than to indicate it as not undesirable, in questions where there are grounds for doubting whether the Legislature is not trenching on the limits of its Constitutional powers. But this at least may be said, that the modern contrivance of the vote by ballot renders that possible, which could not otherwise be obtained without the risk which always attends the assembly of great masses of the people in times of popular excitement, and the difficulty of ascertaining with accuracy, in the confusion of public meetings, the real voices of those entitled to vote.page 7
I have occupied your time in this brief sketch of the growth of government for the purpose of calling attention to this fact: that the aspect of government in the present day is different from what it has ever been, so far as we know, at any previous period; that it is only within, comparatively speaking, the few past years that the mass of the people, without any underlying substratum such as slavery, have become a predominant power; and that by the machinery of election and representation that power is now exercised without turmoil or violence, but peaceably and effectively. Step by step franchises have been lowered, until manhood suffrage has been reached in some countries, and is rapidly approaching in others; and even universal suffrage, that is a suffrage including women, is largely and ably advocated.
The momentous question for the future is—now that power has passed or is passing into the hands of the masses,—What will they do with it?
The history of the present century has been one of what may be termed specially political strife; the main attention of statesmen has been given to questions relating to the redistribution of the balance of political power between the different classes; and on this platform political parties, and their outcome, party government, have been formed. But with the final adjustment of that question, with a franchise enjoyed by all classes equally, political agitation must cease, and party government disappear. Other matters must occupy the arena. The power once securely lodged with the people, to what purpose will they use it? That is the problem of the future. Political power is not an end; it is only a means to an end. It needs little sagacity to predict that the improvement of the social and physical condition of the people will monopolise the thought and mould the action of the governments of the future. Social reform will take the place of political.
We may predicate so much, not only from forecasting the probabilities of the future, but from a survey of what has already taken place even in the few years of the present reign. Just as the increasing pressure of the public mind has been felt on government, so has the spirit of administration changed its character, in the direction of ameliorating the conditions of of life, and softening the asperity with which laws, framed in page 8 ruder stages of society, pressed upon the people. The alterations in the criminal law, the treatment of criminals, the spirit in which the law of libel is interpreted, the care of lunatics, the management of hospitals, the provisions for public health both in towns and in country districts, the drainage of unhealthy localities, the extension of popular education—all these are matters which have received an amount of attention in the last few years which has never before been accorded to them. And, in addition, the inventions of modern science, such as railroads and telegraphs, have forced upon Government new duties and responsibilities, all tending towards the same end,—the improvement in the physical and social conditions of life amongst the great masses of the population.
And this brings us to the question so often asked,—What are he limits within which the duties of Government lie? and what are those which ought to be left—to use a common expression—to private enterprise? A question never satisfactorily answered, because public opinion, reflected in or led by the views of statesmen, is undergoing a gradual but great change in this matter. It used to be thought that the only duty of Government was to collect the revenue required for the support of its power and dignity, to maintain order in the community, to provide for the due administration of the laws, to guide the nation in its action in relation to foreign States, and to maintain the national religions institutions of the country : that all interference with matters of a commercial character should he left to the private enterprise of its citizens. Nay further, it was argued that any interference by Government in other matters tended to impair the spirit of independence in a people, and to cripple the energy of individual exertion, No one will deny that there is a truth underlying this view. To have everything done for us by a sort of beneficent despotism, instead of being compelled to the wholesome exertion of doing it for ourselves, no doubt tends to emasculate the energy and to enfeeble the self-reliance of a people. But how if the people are themselves the Government, or the basis on which the Government rests, and in obedience to whose behests it lives and moves and has its being? It is clear that the old doctrine is one transmitted to us from ages, when Governments were regarded as something above and outside of, and often opposed to the people, instead of being in and of them. One of the most striking features of modern times is the exten- page 9 sion of trade and manufactures by means of companies of share-holders. Do we consider that individual energy is repressed in shareholders, by their confiding the management of the concern for which they have associated themselves to directors whom they select for the purpose? Surely no one will say so.
The question then is,—Does not Government, exactly in pro-portion as it becomes more and more a reflection of the popular will, assume more and more the position of a directory of a company, in which every citizen is a shareholder? and if this is so, what then are the limits within which the action of Government should be confined? Let us consider for a moment the extent to which the old idea of Government has already been violated in all free States; that is to say, the matters in which Government engages, which might be left to private enterprise. Take the post office for example. There are companies for carrying goods and parcels and delivering them in towns and in the country. And what is the difference between a hater and a parcel? But no one will dispute that by the creation of a national organization for distributing letters, an immense benefit is conferred on the whole community. And yet can it be denied that Government not only interferes in this matter with private enterprise, but does so to the utmost extent, by vesting in itself a close monopoly, and debarring by penalties the competition of private persons? Take again the post office money order system, in which the Government competes with the bankers in the business of transmitting money; or the savings banks, in which it goes into the market against a multitude of private companies. I might also instance the case of railroads; which in this, as in many other countries, are Government monopolies; and are managed with at least as great satisfaction to the public as those which are still in the hands of private companies. Still more aptly may I quote the instance of telegraphs, which, in Great Britain, were bought by the State, after the experiment had been tried for some years of their management as private speculations; and it is, I believe, admitted that they are now managed by the Government with as much success and with as much benefit to the public as when they were in private hands. The Government Insurance Office, and the Public Trust Office are instances in which we in this colony have carried the same principle to a step further than has been elsewhere attempted, and, so far as I am aware, without any complaint against the establishment or the management of those institutions. And it is not only page 10 in the general government that this new principle has been asserted; for it has been still further extended in the subordinate or local governments; for instance, in the supply of gas, water, and tramways in towns, which are often provided by the municipality, the whole of the inhabitants being taxed for the purpose.
It is evident, then, that the old definition of the duty of Government fails to include much of what is now generally admitted to be within its proper functions:—that the realm of private enterprise has been invaded at many points; and that with the greatest benefit to the people. Take for example the supply of water. A private company would probably only supply it in such quarters as would prove remunerative. But in the hands of the governing body, it would be supplied equally to all classes; not only sub-serving the luxury of the rich, but bringing to the poorest home that which is a necessary condition of health and comfort. Seeing then the extent to which Government has already intruded into the territory of private enterprise, the question forces itself upon all who speculate on the possibilities of the future, to what extent may not the citizens of each State be beneficially associated in a common organization for special purposes?
In the existing organization of society two great underlying principles are at work, pointing in opposite directions, and in distinct hostility the one to the other. I mean competition and communism. Competition claims that the interests of society are best subserved, by relying upon the instinct of human nature which impels each individual to acquire as much as possible for himself. It finds expression in the old proverbs "Self preservation is the first law of nature"—"Charity begins at home"—"God helps him most who helps himself" and such like. It regards success as the natural and predestinated reward of superior strength or skill, sagacity, forsight, or cunning; and in these days it appeals to a new sanction, derived from the all-pervading law of organic life, now generally accepted, that nature operates by "the survival of the fittest" and its advocates may well ask in the words of Scotland's bard,
"Why then ask of silly man
To oppose great nature's plan."
It asserts further, that, in the universal struggle of all for superiority, the self-reliance, endurance, skill, and prudence of every individual are sharpened and strengthened; that the result is a page 11 general increase in the products of human labour, and a necessary increase in the prosperity of the whole community; and it takes credit for a still further advantage, in that, by the competition between rival producers and distributors, articles of consumption are supplied to the people at a lower price than can be attained by any other method. Against this theory, communism wages perpetual war: and in using this ominous word, you will understand that I mean, not only or principally the ultimate development of the principle, which demands the abolition of all individual property—which says with Prudhorhe "property is robbery," and claims that all wealth shall be held by the community at large, each individual enjoying an equal share of its use; but I embrace in the term all arrangements whereby men associate themselves for common objects, and to which the milder name of co-operation is applied. Co-operation is no more than a partial adoption by one section of the people, and for a special purpose, of that which communism would apply to the whole, and for every purpose in the organisation of society. Communism was attempted in the first formation of the Christian Church, and was adopted in supposed compliance with the will of its Founder. We all know how the experiment first displayed its inherent weakness, in the dishonesty of some of the members. And even those who have no hostility to the extreme doctrine in theory, can hardly fail to perceive how inapplicable it is to human nature in its existing phase. Surely all but the most visionary must admit, that community of goods can only exist in a people amongst whom coexists a corresponding community of character and feeling, of principle and of honor, of motives and impulses,—a people trained to an entire abnegation of self, and possessing an all pervading faith in one another. Some of us may indulge in the dream, that such may be the final consummation of human society; that to such an end the destinies of our race are surely though slowly tending; but we must also perceive that community of goods, as a universal rule, will be the result not the cause of that refinement and elevation in the moral condition of mankind, without which it cannot exist.
No sane thinker on these matters can believe that communism in its furthest development, could be suddenly or violently imposed with any hope of practical success, upon men who have for long ages been trained in the opposite belief, and all whose conceptions have been moulded on other principles. Social systems are things of growth. They may be violently broken up by convulsions; but even page 12 then the new principles do not for a long time take abiding root in the national character. How soon did not England return from the republican to the old monarchical idea. It is now a century since the French Revolution, yet how recently have republican principles prevailed in that country. How short a time elapsed after the declaration of the rights of man, before France relapsed into the old forms under the new name of Empire; and distributed, as the prizes of successful conquest, the wealth and honors and titles, which it had destroyed as the possession of proscriptive right and ancient lineage. It was the old world story. The emancipated slaves, under the burden and hard training of unaccustomed freedom, sighed once more for the fleshpots of Egypt.
But what cannot be effected by sudden and violent change may be approached by the slow but irresistible growth of popular feeling, especially when awakened by the teaching of those who have applied great information and power of thought to the investigation of the causes of the unequal distribution of the comforts and conveniences, not to say the necessaries of life, amongst different classes and individuals. And such is one remarkable feature of the literature of the present day. Such too is the tendency of those institutions of which so many have sprung up in the last twenty or thirty years, the co-operative clubs, and the still older Friendly Societies, and the older yet associations of Trades Unions. All these are separate and isolated endeavors, tending, in special spheres, to the same end as that which communism aims at applying to the entire organization of society; and they are based on the same great underlying principle which inspires the faith of the communist. Under the influence of these institutions the public mind is being schooled and educated, no less by their failures than by their successes; is learning the true principles, so far as they can be said to be established, if political economy—of the laws which regulate the creation and distribution of wealth; is being taught, above all, how much it is possible to achieve, consistently with the existing moral and mental condition of men; and, at the same time, by the reaction which wholesome exertion exercises upon the human faculties rightly used, is being elevated and trained to an extent which may render it capable of wider and more beneficent applications of the principles which inspired its earliest efforts.
Let us clearly understand the difference between the two principles of which I am speaking. The doctrine of competition is based on the belief that the mainspring of human action is page 13 self-interest; communism, in the faith that it is, or ought to be, the subordination of self-interest to the sense of human brotherhood. Competition looks mainly to production; and, deeming it proved that the progress of society depends on the advance of its powers of production, infers that the national prosperity must be the inevitable result. Communism looks rather to distribution; and asserts that, whatever may be the power of production, where the results are monopolised by the few, whilst a large section of the mass is left in destitution, society on the whole is not progressing but retrograding. From the stand-point of the present, it may be difficult to gather from the observations we are able to make on the infinitely complicated machine of society moving around us, what may be the outcome of the opposing forces at work; but from a moral point of view, from the principles of eternal right and wrong which are implanted in the human breast, we may judge of the character of the two principles of which I am speaking, and may determine which ought to tend, and unless all social organization is a piece of disjointed and inharmonious mechanism, must tend, to the advancement, the happiness, and the prosperity of a nation.
Which, then, is the nobler instinct of the two,—the law of self-interest, or the law of brotherhood? Test it by an extreme case. Let us suppose that some of us are cast adrift upon a raft in mid ocean; that there is but a limited supply of food and water; that the only hope of safety lies in being picked up by some passing ship before our supplies are exhausted. Shall we deem that a fulfilment of the highest duty of man, which would impel the strong to cast the weak to the sharks, so that their own chances of life might thereby be prolonged? Or shall we be ashamed of the weakness under which our breasts have sometimes heaved with emotion and our eyes filled with tears, when hearing, as we have sometimes heard, how the strongest and roughest seaman of the company has deprived himself of the portion which was his equal share, and waved from his burning lips the last drop of water, that he might alleviate in some measure the sufferings—perchance add something to the desperate chance of life—of the feeblest woman or the tenderest child with whom he was bound in a companionship of suffering. Shall we say that this is a strained or unfair test of what is noble or base in human action? Are we not all, each generation in its turn, adrift on the page 14 raft of time amidst the boundless ocean of eternity, with the same duty imposed on us, if not to share alike, at least to provide that the monopoly of comfort and luxury by the few does not condemn the many to suffering and destitution? How then can we refuse our admiration at the motives which have induced the Trades Unions to set their face against piece work or other means by which the stronger and more skilful workman can by working longer and more expeditiously, earn higher wager than his fellows? They may be wrong; it may be that the course they take would fustrate, not advance their object; but the impulse which moves them to determine that, where there is only a given amount of work to be done, and more men than are necessary to do it, they shall all share and share alike, this surely is dictated by a motive which appeals to the noblest and most heroic instincts of the human breast.
Among the manifold developments of the doctrine of competition, I will notice one, in the system of contracts, upon which the largest part of all undertakings, by private persons and companies, and also by Governments are carried on; until it has come to exercise a great influence on the organization of society. It has grown up out of the, necessity, that, where works require the organized labor of large numbers of workmen, they should be directed and superintended by someone having skill and experience in the description of undertaking required. It is rightly assumed that such an overseer will apply the labor at his disposal in the most efficient manner. But it is further assumed that, by inviting public tenders, the work will be done in the cheapest manner for the employers if the lowest tender is taken. But what are the grounds for such an assumption? The cost of a work is a fact. With a known market price of materials, and of the current rate of wages at the time, a work will cost just the same, whether done by a contractor or by an employer. It is quite true that the employer has the advantage of knowing exactly, or thinks he knows exactly, what his utmost outlay will be; and, where he is ignorant of the mode of the execution himself, he thus insures himself against loss; but, as a matter of fact, the work costs the same. If the contract price is less than that, the contractor loses; if more, he gains, and often gains enormously, very much more than the fair value of his labor and skill in superintendence. That this is so the enormous fortunes made by many contractors in all countries clearly prove. The workmen do not work more skilfully or page 15 harder for the contractor than they would for the employer. Why should they do so? They have no motive that I can see. The laborer or mechanic works his best, in order, by acquiring a good character in his trade, to secure constant employment and higher wages. Again, it is assumed that it is impossible to obtain the services of competent superintendents, who will honestly consult the employers' interests, at a fixed rate of wages; and that such men would display more skill and energy if working for their own pockets than if working for an employer. But surely the overseer has the same motive to establish a character for skill and management which the workman has, namely, the desire to prove himself the best man who can be found in his trade. It is idle to say that honest and skilful overseers are not to be procured for fair salaries, whilst we employ multitudes of superintendents in various classes of industry upon wages, not by contract. We do not let out our railways to be worked by a general manager by contract, or employ captains by contract to sail our ships; and yet in these and a thousand other cases, we require the experience and skill necessary in the application of organized labor; and the work in railway workshops, and in dockyards and arsenals is as well and as cheaply done as any that a contractor can produce. But the vice of the contract system is that it makes it the direct interest of the contractor to act unfairly by the employer. His profits depend upon the cheapness with which he can get the work done. If he can get inferior material at a lower price, or hire less skilful labour at a lower rate, that is so much in his pocket; and to prevent his doing so, we employ engineers, and architects, and clerks of the works, to see that we get the worth of our money; so that our protection, after all, is in the hired servant, not in the contractor. To put it broadly,—we make it the contractor's interest to cheat us. I am far from saying that he always does so. I willingly bear witness to the honesty and liberality of many contractors with whom I have been brought in contact. And the more honor to those who, in spite of the temptation to which the system exposes them, do really honestly carry out their contracts even at their own loss. But the frequent disputes which arise at the conclusion of contracts, evidence on the other hand the unsatisfactory character of the bargain. Again, such is the looseness of the terms in which page 16 contracts are often, and sometimes unavoidably, drawn up, that the contractor can generally speculate on necessary accessories to the work, for which he can charge as extras, and so supplement any deficiency in his tender for what is included in the specification. Singularly enough, in one large class of employment—I mean the collection of revenue—the practice of farming the revenues, that is of letting the collection of them out by contract, is an expedient which has long been abandoned by all but simi-barbarous States. In civilized countries it has been found that the system of employing paid servants in this branch of labor is, beyond all comparison, cheaper than the contract system.
I have taken this as one instance of the manner in which the application of the doctrine of competition operates to distribute the produce of labour with enormous inequality, and to produce a natural feeling of discontent amongst the masses. I am quite aware of the arguments put forward by modern writers, especially in that most remarkable work on "Progress and Poverty" by Mr. George, to prove that the possession of land by private individuals is the sole cause of the unequal distribution of wealth. But I confess myself to be unable to perceive why the monopoly of large estates in land should give one man the power to grasp an unfair proportion of the produce of labor, whilst the same evil should not arise from a similar monopoly of capital. It may be quite true, and no doubt is, that, in the war between labour and capital, the attention of those who are suffering from the existing condition of society has been mainly fixed on the monopoly of capital, and has overlooked the perhaps still greater evil caused by the monopoly of land; but to attribute no ill effect to the former seems to me to overstate the case as against land. The truth is that the monopoly of capital is a more patent fact presented to the view of the working classes. It is not unnatural that the labourer should regard the possession of great landed estate which has been handed down for generations as the heritage of a noble family, if not without a feeling of envy, still without active hostility; especially when relations of a kindly and beneficent character have existed between the fortunate possessor of wealth and the poor around him, which have been equally handed down from the ancestors on both sides; and the people may well fail to trace the cause of the increasing hardness of their lot, in arrangements which, so far as they can see, have page 17 been unchanged for generations. But far differently must they view the unequal division of the new wealth which is being daily created around them, by the labor of their own hands. When Tom and Harry, two stalwart youths, are working in a railway cutting at the age of eighteen, and twenty years after Tom is still using his pick and filling his barrow, whilst Harry drives by in his coach, and looks down on his former mate from the earthly paradise of half a million of money, can we be surprised that Tom and his friends should ask with some discontent,—why is this?—what is the secret of this complex machine of society, with its sacred rights of property, and its hard maxims of political economy, which permits, nay encourages, the absorption of the produce of the labor of all, into the hands of the few;—too often into the hands of men in no way pre-eminent above their fellows in any of those qualities which he has been taught to respect as deserving the esteem and homage of mankind. Those who argue, as Mr. George does, that the real contest is not between labor and capital, but between labor and rent of land—that capital is not advanced by the capitalist to set labour in motion, but that it is really advanced by the labourer to the capitalist, because the former gives the produce of his labour to the latter, before he gets his wages,—have started a proposition which may or may not be theoretically true, but which does not, in its application, fit into or account for the phenomena of actual life. If a large manufacturing establishment stops payment, and hundreds of men are suddenly thrown out of employment and their families are brought to the brink of starvation, how can you persuade those who are exposed to such suffering, that the withdrawal of the source of their weekly wages, that is of the capital which has been lost, is not the proximate cause of their distress? Or how can you expect them not to believe that the aggregation of vast capital in the hands of one man, does not invest the owner with an enormous power for weal or woe over the fortunes and lives of his fellow creatures? Practically it does so. The political economist may be right; on the whole and in the long run, the facts may fit themselves to the theory. But there is one all important fact which is left out of consideration; namely, that a man must have food to live, and that if for a very few days he is deprived of food he dies. The capital lost by one has only passed into other hands. The labor must, in some fashion or other, follow it. But the transition is only effected with great misery, and often with loss page 18 of life. Water, we know, always tends to assume a level surface. But the water at one bank of a river will often be fount higher than at the opposite bank. Why? because the element of time intervenes; it has not had time to distribute itself, that is, to adjust the fact to the law. And so it is in human affairs; but with this difference, that if the water does not find its level in a given time it does not die, and the man does.
You percieve I am arguing that the doctrine of the older writers, from Adam Smith downwards is, in its practical application to the circumstances of society, not to be set aside; and that capital must be regarded as the agent for setting labor in motion; and hence that the popular view, that the accumulation of vast hords of capital in few hands, with all the incidental power with which it invests its possessor over the lives and happiness of a large part of his fellow creatures, is a great and patent evil in a State—that this view, I say, is one founded on a truth winch cannot be set aside. This being so, the remedy seems to lie in the direction of a more even distribution of capital amongst the community; not by violent spoliation of the rich and division of existing wealth amongst the poor, which would effect no more than a temporary change without affecting the cause of the evil, but by such adjustments of the economical machinery, that is, of the artificial arrangements we have made as regards property, that wealth shall naturally tend to distribute itself, instead of to accumulate in heaps.
It is common to hear it said these things should be left to the free working of economical law;—that the State should not interfere. But the State has always interfered. It formerly allowed the combination of employers, whilst it made the combination of employed criminal. In a multitude of ways in olden time it tried, both directly and indirectly, to force down wages, and to encourage the monopoly of wealth. The spirit of legislation has, indeed, to a great extent changed. Trades union combinations are no longer illegal. Friendly Societies and Savings Banks are under the patronage of the State. The great question for the future is, in what way and to what extent can the State encourage and stimulate the movement by which working men may become shareholders in industrial enterprises, and so become the recipients both of wages and profits?—to what extent can co-operation be aided bv, or even be absorbed into the duties of Government?—to page 19 what extent can the vast accretions of wealth arising from all that a nation annually produces over and above what it consumes, instead of being poured into private tanks, be conducted into one great national reservoir, and held in trust for the benefit of the people by whose labor it has been created?
In railways which belong to a Government, this is already done to the fullest extent. Every taxpayer in the country is a shareholder in the company by which they are managed. It is on the security of the taxpayers that the capital has been borrowed to construct them. If your railways do not produce, in net profits, enough to pay the interest on the debt, the balance has to be paid by taxation. If the net profits exceed that interest, the money goes directly into all our pockets; because taxation for other purposes of Government can be remitted to an equal amount. A Government railway system is, in fact, nothing more than a large co-operative society in which every taxpayer is a shareholder, and shares the profits, or has to pay the losses by calls under the name of taxes.
A Government Insurance office is a somewhat similar institution applied to one section of the community instead of the whole; that is, to those only who voluntarily associate themselves. But there is this distinction. In a State Insurance office on the mutual principle, the profits are periodically divided amongst the insurers, not amongst the taxpayers; whereas if the office is guaranteed by the State, any loss, were any possible, would have to be made up by the taxpayers, most of whom have no interest in the concern. In this respect the plan of compulsory insurance proposed by the Rev. Mr. Blackley, which has been submitted for the consideration of this colony by our Government, is devoid of the inconsistency I have just pointed out; because, all being insured alike, all would share equally the risks and profits;—the profits in this case, being the allowance in case of sickness or accident, and the annuity after a certain period of life. I can conceive no form of co-operation more sound in principle or more entirely beneficial to a community than such a scheme, if carefully adjusted to the circumstances of the people in which it was in force.
Another form in which capital is accumulated in few hands is in the business of banking. Might not banking be more usefully carried on by the State, that is by the whole community as a page 20 co-operative concern, than by private persons or companies? It is generally supposed that banking requires capital. This is a mistake. Banks have been carried on successfully for long years without any capital. I can remember two instances in which, when failure having occurred in exceptionally bad times, it was proved that the bank had lost all its capital many years before. In fact, the dictum of an old country banker I remember was true, that if a man could not carry on a bank without capital, he did not understand his business. The simplest form of banking is where the banker invests the money placed in his hands in the public funds, retaining only so much in his safe as will meet the current calls over the counter. Thus, if his current deposits are £500,000, and £50,000 is sufficient for current demand, he can invest £450,000 in the funds, and live on the interest. The only capital he requires, is to recoup any loss arising from a fall in Government stock if he is compelled to sell out; and even that a prudent banker would have provided for by saving a rest out of his income. The only difference in the modern process of banking is, that the banker lends the money to private persons, instead of to the State, in the form of bills and overdrafts for which he takes security. He only fails, where he invests his money on bad security or in forms in which it is not readily available for conversion in case of extraordinary current demands. When we read of such large dividends being paid on the shares in bank stock, it must be remembered that these dividends are not the produce of the bank's capital only, but of all the money lent to it by depositors. The capital may be only a million; the current deposits may be live millions. The produce of the latter, invested at small interest, will allow of a very large interest being paid on the former. But under a system of a State bank, the bank would be a co-operative society in which the profits would belong to all the depositors. I can see no reason why such a bank should not exist, in which all the depositors should be dealt with as shareholders, each being credited with interest on his daily balance, or his average daily balance at longer periods, the interest being altered from time to time as the necessities of the bank required, so that on the whole no profit to the bank should acrue. If at the accounting period the assets were in excess, that would prove that a larger interest might safely have been credited to the depositors; if they were deficient, that interest had been fixed at too high a rate. page 21 An alteration in the rate of interest would adjust the account. The gain to the community would be,—first that the profits on the depositors money would go to the depositors instead of to a body of shareholders: and secondly, that the wide-spread misery the disturbance of trade in all its ramifications, and the great incidental loss extending through remote classes and interests, which always follow a bank failure, would be rendered impossible. The wealth of the whole community would be the guarantee of the bank's safety, and capital in the ordinary sense would be unnecessary to the management of its affairs. And I have no doubt that under such an institution the facilities of banking would be vastly extended, and would be taken advantage of by a stratum of society to which they are not at present available;—to such an extent indeed that the necessity of savings banks would be altogether superseded. By the ordinary system of fixed deposits, the national bank would fulfil all the functions of the savings bank for the people.
Here again the old objection would start up,—There would be no security that the affairs of the bank would be conducted with prudence, sagacity and skill. But what security is there at present? We are told the motive of self interest: that the shareholders are certain to look after their money. But have we not recently had some startling examples of the contrary? The truth is that the shareholders rely on the directors; and the directors must rely on the fidelity and ability of the paid managers, who have no interest in the concern except their salaries, and their prospect of promotion by the exhibition of honest and capability; and why those qualities should be found in the service of private persons only, and not in the service of the State, I am unable to see; the more so that I do see, as a fact, vast concerns conducted by all Governments, in which agents possessed of the necessary qualifications are not difficult to find. This, then, is only one of many directions in which it seems to me possible that Governments may aid in applying the principle of co-operation to embrace the whole community, and may impose a barrier in the way of a mischievous monopoly of wealth in private hands.
But here I must notice an objection not without weight. It is said that under our system of Government by representative chambers, and responsible ministers who are the organs of political page 22 parties, influences of a political character would be felt in the management of undertakings of a commercial nature, which would impair their utility. I do not deny it. Railways might possibly be managed, not for the interest of the railways or the public, but for patty purposes. A State Bank might be converted into a most potent engine of party. I see the danger of this. But I see the remedy. It lies in a comprehension of the most ancient principles of the Constitution. What is usually called the Government, that is the ministry of the day, is not entrusted, according to our constitution, with more than a limited part of the powers of the State. The laws are not administered by the political Government, but by the judicial. And well did the great founders of the American Commonwealth comprehend the value of that principle, when they kept the judicial functions distinct from the political, and, in some respects, extended the powers of the former at the expense of the latter. For example, the Courts of law in England cannot set aside an Act of Parliament. They can only interpret it. But the Supreme Court of the United States can declare an Act of Congress null and void, as having been passed ultra vires. If, then, the administration of one large part of the functions and powers of the Government as a whole, are not entrusted to the administrative or political Government, where lies the difficulty in handing over the powers of the State, in what may be called its commercial capacity, to bodies outside of, and beyond the influence of the political Government? If we hold, as we all do, that the great bulwark of our liberties lies even less in franchises and popular government, than in the independence of the Courts of law, both of the Crown on one hand and of the people on the other, would it not be equally not only wise but necessary, and equally in accordance with the whole spirit of the Constitution, that the administration of the Government in its commercial character should, in a similar way, be protected from influences which could not fail to be mischievous, and should be vested in independent authorities, specially adapted to secure the success of the undertakings committed to their charge?
The last subject to which I will call your attention is that of possible changes in the nature of landed property. It is very remarkable how clearly the evil of the monopoly of land was foreseen by the first Jewish law givers. In the code of law which we find in the book of Leviticus, the law of Jubilee page 23 enacted that all lands sold should revert to the original proprietors or their heirs on the day of Jubilee, which occurred every fifty years. Thus the owner could only dispose of his patrimony virtually by lease, for the unexpired term ending on the next Jubilee day. The tendency to the aggregation of large landed estates was no doubt as great then as now, and would have been more severely felt in a small country, little larger than the Canterbury plains in this colony; and the wise provision for the periodical re-distribution of the land may be looked on as one principal cause of the vast increase in the population and wealth of Palestine, which took place up to the time of Soloman; nor can it be regarded as fanciful to say that the neglect of this law may have been one of the causes of the gradual dissolution of the Hebrew Commonwealth. For when the prophet Jeremiah bought a piece of land just before the captivity, in order to prove his own conviction of the truth of his prophecy of the restoration of the Jews to their land after seventy years, whilst under the Mosaic law, the sale would have been by that time anulled, we must conclude that the law of Jubilee, as affecting land, had become obsolete.
That all lands were, in early times, held in commonalty as the property of the State is now sufficiently established. That, as settlement on land for agricultural uses took the place of nomadic habits and the pursuit of the chase, private and personal rights intruded themselves into the communistic title, there can be no doubt. Under the Feudal system the land was vested in the Crown, and was held by the tenant, originally for service, which was subsequently commuted into payment in money. But before many generations had passed away, the interest of the tenant gradually exterminated the communistic title of the State. The history of the law of real property is one of a persistent encroachment of private upon public right, until at length the right of private property in land acquired a sort of sanctity superior even to that which was attributed to personality. But it is clear that the national title was never wholly abandoned, nor, had the monarch been in realty, as he was in theory, the trustee and guardian of the public estate for the benefit of the whole community, would, perhaps, such encroachments have been tolerated. But this great change in the idea of private property in land took place in ages when the interests of the great feudatories were paramount, and page 24 the mass of the people had but a feeble perception of their rights, and little or no influence on the action of the governing powers. The vast confiscations of lands which, in troublous times, extended over so large a part of England, and over the largest part of Ireland,—the resumption of the lands of the monasteries and abbeys by Henry VIII, and in our own time of the property of the Irish Church,—were all more or less assertions on the part of the State of the ancient right to deal with land as public property; and traces of the same doctrine still find,—or till very recently found, expression in existing law. That, in the case of intestacy without an heir, the land reverts to the Crown—that the same rule is applied to the estates of those convicted of certain crimes, and attainted in blood,—the laws of mortmain and entail—the inability to convey land to the subject of a foreign State,—all bear witness to the vitality of the ancient idea, that private property in land only exists subject to such conditions and restrictions as the State may think fit to impose. And within the present century States have begun to resume to a further extent their old rights, by asserting the power to take lands without the consent of the proprietors, for public purposes; especially for railways; paying, it is true, compensation, but still asserting the principle that the public right must overrule all private rights in the proprietorship of the soil. And writers have now appeared who advocate the exercise of the same right, on the same grounds, that is the public necessities, to the extent that the State should resume the ownership of the entire soil of the country, and hold it in trust for the people at large. Some, such as Mr. George, to whose work I have already alluded, deny all claim to compensation on the part of the present owners; some, as Mr. Wallace, admit a claim for compensation, and would satisfy it in the form of a life annuity to the existing proprietors, and their immediate heirs, and, if necessary would extend it to a third generation. All writers agree that the improvements on land made by occupiers should belong to the tenant; but whilst some maintain that the State should resume the land itself, that is to say, the rent of the unimproved value, others go only so far as to claim for the State the unearned increment, that is to say, that part of the value which bus arisen from the general progress and prosperity of the community, over and above the original or natural value which it may be supposed to have been worth,page 25
But whatever view we take as to the right of the State to resume the ownership of the soil, there remains the question of its expediency. Will such a policy produce the beneficial results promised? And again, are the evils such as to justify the application of so drastic a remedy! I confess myself unable to accept Mr. George's conclusion, so far at least as I have been able to consider the subject, that all the ills arising from the vast inequality in the distribution of wealth would be at once remedied by a resumption of the ownership of the land by the State; or to perceive the justice of the distinction he draws between the monopoly of land and of other forms of wealth as the only cause of those evils. For the purpose of this argument, land appears to me to have the same effect on the social system as any other form of wealth; and, if I assented to the doctrine of the abolition of private ownership, it would be because the more equal distribution of wealth amongst the different sections and individuals of society, appears a result which must in some fashion be achieved, unless the whole fabric of modern civilization is to be permitted to crumble into the dust. In this view the aggregation of large tracts of country in private hands should be subjected to the same restrictions which should be applied to wealth of whatever kind. I have only called your attention to this as one amongst the other burning questions which must before long occupy the minds of statesmen during the next generation. But I may point out that the recent legislation on the subject of the land in Ireland has greatly hastened the period when the question must be brought to a practical issue. That measure seems to me to be a final abandonment on the part of the British Government of the doctrine hitherto thought to be beyond the pale of discussion—the inviolability of the right of private property in land. The new land law for Ireland does without question admit the principle that it is within the power of the Legislature to partition the property in the soil between the landlord and the tenant, that it takes the land out of the category of those things which are the subject of free bargain, regulated by the ordinary law of supply and demand; and, more than all, that it does this without recognising any claim to compensation on the part of the landlord. Confiscation has been for ages the basis of title to a great part of the soil of Ireland; but it has been the confiscation of the property of the rich to give to the rich; now for the first time it page 26 is the confiscation of part of the property of the rich to bestow it on the poor. Idle indeed it is not to forsee the influence which the principle asserted by this law must have in the future discussion of this important question.
In conclusion, I have endeavoured to call your attention to some of the demands which may possibly be made on future Governments, because the phenomena of the present day indicate the approach of an epoch, which may be one of momentous consequence to the civilized world; phenomena which force on us the question—In what direction are we really moving? I have read that in one attempt which was made by the late Sir Edward Parry to reach the North Pole, by means of boats, used as sledges where no open water was to be found, as the seamen were toiling over the icefields, and dragging the boats at a rate which seemed to promise a successful termination to the expedition, the observation of the Commander shewed that their real position was, day by day, further south than on the day before. To the superficial view of the seaman he was travelling to the north; the higher knowledge disclosed the truth that the whole icefield was bearing him to the southward, faster than his wearied footsteps traversed its surface to the north. And may not this be our own case; May it not be that, dazzled by the glitter of the enormous wealth which is increasing with such amazing rapidity around us,—ministered to in every want by the stupendous powers of nature, which are being evoked from their secret recesses to be chained to our chariot wheels—may not we blindly fancy that we are building up an enduring structure of imperishable prosperity, whilst we are really underlaying the foundations with subterraneous forces, which, sooner or later, may shatter our palaces to atoms? How can we close our ears to the warning voices which, like the unheeded utterances of the prophets of old, tell us that our civilisation is rotten to the core; that its only result is, that whilst the rich are growing ever richer the poor are growing ever poorer? What can we say of a social system which is powerless to solve an economical problem except by the inhuman machinery of the strike; a machinery which at once paralises "the might that slumbers in the peasant's arm," and crushes, with equal and pitiless cruelty, the tenderness of maternity and the innocence of childhood? What shall we say to the incomprehensible phenomenon, that the Irish peasantry, with a population of five millions, are in the same state of misery and page 27 destitution as they were thirty or forty years ago, with a population of eight millions, whilst the wealth of the country has more than doubled? How do we explain the fact that whole districts in Scotland which were once the home of a strong and well fed race of hardy mountaineers, are now only the haunts of the wild deer and game which minister to the sport and luxury of the rich?—forgetful of the truth which revealed itself to the poet, though ignored by the economist,
"Ill fares the land to hastening ills a prey,
Where wealth accumulates, while men decay."
Or what, again, is the solution of the mystery that, after so many years of the boasted beneficence of our rule over India—the rule of the mightiest and wealthiest nation on the earth—periodical famine still stalks over the rice fields of Hindostan, mowing down in its ghastly stride more human victims than the car of Juggurnaut or the sword of the ruthless despots whose rule we have replaced?
What well grounded belief have we that this stupendous fabric of modern civilization of which we boast is destined to be more enduring than those of which the shattered monuments alone tell us of their existence and their extirmination? They fell—some we know—all we may confidently believe, because, in the fierce competition for wealth, and the insatiable lust for power, the moral elements which knit together all human society were dissolved; the luxury of the rich became licentiousness; the degradation of the poor wrought crime and lawlessness; wealth became the agent, and poverty the victim of corruption; the ties of home and the fires of patriotism were drowned in the rising flood of anarchy, and the seething mass preyed on itself until swept away by some stronger race;—some race which, though apparently of ruder and less matured social organization, was yet closely united by the strong affinity of its individual atoms; compact by the love of kindred and the pride of race; strong in the instinct of brotherhood and faith in one another, in ail the true and only elements of enduring national greatness. And it is not enough to tell us that the poor are better off than they were, because the rate of wages is higher, and the price of food and clothing lower than formerly. You can measure lengths by a two-foot rule if you know that your two-foot rule remains unchanged: but to measure things in different ages by a standard which is itself constantly fluctuating from age to age, this is but a deceptive process. No one who knows anything of the history of the English page 28 people can believe that there was anything like the distinction, in bed and in board, between the Saxon Thane and the Saxon Churl, aye or between the Saxon Thane and his British Slave, that there is at the present day between the millionaire and the peasant. But even were it so, were it true that the lower orders of civilized States are physically better off than of old, that is not enough. The question they ask you is—Are we better off in proportion to the enormous increase in the wealth and prosperity of our common country? If it be true that the whole standard, that the possibilities of comfort are raised, the supply of a lower is surely a cause for discontent. It is not absolute want only that is felt; it is relative want; and the bite of want is ever deeper when its tooth is sharpened by the sense of injustice. And can we believe that this education, which is being so widely extended amongst the masses of all civilized States, will not tend to raise their tastes and stimulate their desire for a higher condition of personal comfort and refinement? If we are not prepared to re-adjust in some fashion the distribution of wealth, the present policy of universal education does seem to me something like the scheme of a maniac. What is it but to sow broadcast amongst the people the seeds of discontent at a system which at the same time we tell them is the result of inexorable economic law? To educate the people—to widen the sphere of their knowledge—to train their intellect and cultivate their taste, and teach them to aspire to a higher moral and intellectual condition of existence, and at the same time to tell them that any corresponding amelioration of their physical condition is a thing hopelessly impossible,—that the privations of penury and the pangs of starvation are necessary ills, which defy the wisdom of the legislator to correct, or the benevolence of the philanthropist to relieve, what is this but to transform discontent into despair, and ultimately to convert the national school into a hotbed of the deadliest Nihilism?
Shall we then say that there is no hope for the future?—that our modern civilization must die, like those which have preceded it in the world's history? Shall we, like the men of old continue to eat and drink and marry and be given in marriage, while the waters of anarchy are oozing up under our feet, and the windows of heaven—the divine retribution for national wrong—are opening above our heads? or will the men of this generation, warned by the ruin of the civilizations of the past, evoke the means of salvation for that which we have inherited? I would fain fancy that page 29 over the storm clouds which blacken the horizon I see the bow of promise, the symbol of safety. I see it in the fact that the governments of civilized States are becoming more and more the reflex of the will of the people, and that not of peoples barbarous and ignorant as of old, but of peoples growing year by year in intelligence and knowledge, as they have already grown in political power; and I cannot but believe that, when they once come to perceive the true cause of the ills which press so heavily on their condition, no prescription of birth, or rank, or wealth, or power, will be able to withstand the fulfilment of their desires, and the application of the remedies which they are certain to, and have a right to demand. At the same time I cannot close my eyes to the one disheartening feature in the present age; it is that in the great republic of America, the greatest experiment the world has seen in the science of government, where political rights have been more widely extended and longer enjoyed than amongst any people on the earth, the same evils, which are the inheritance of older States, are growing with the same vigorous vitality as that which characterises every development in that wonderful country. The dominance and monopoly of wealth, the strife between labor and capital the insane contrivance of the strike, the widening gulf between class and class, between rich and poor, are all, to take the evidence of their own writers, repeating themselves in the land of republican freedom, with the same ominous aspect as that which looms over the future of the most aristocratic of European States. But I cannot lose all faith in America; I cannot lose faith in a country which came triumphant out of the great war for the emancipation of the slave, and the maintenance of the Union; I cannot forget how, whilst the purblind critics of the English press were prophesying that the self interest and selfishness of the Western States would induce them to withhold their aid in that great struggle, all minor, all selfish considerations were merged in the instinct of a lofty patriotism; and from the farms and log huts of the western prairies, from a people, though keenly suffering under the pressure of a protective tariff which they hated, mothers sent forth their sons and wives their husbands to fight in the common cause, that, come what might, the great experiment of a free republic, to which they were pledged in the eyes of the civilized world, come what might, should be maintained in voilate. And I cannot but believe, that when that great people come to perceive the real cause of the page 30 growing evils and the possible destruction of the nation of which they are so justly proud, the singular energy and inventiveness, which are the peculiar characteristics of the American citizen, will not fail to discover or he slow to apply such remedies as may avert the threatened disaster.
And not less in these colonies of our own Empire, which have grown up as if by an enchanter's wand on the shores of the Pacific, not less on us, though on a smaller stage, does the duty lie, to meet with courage the demands of the future. We stand in a position peculiarly fitted for the attempt. Tradition and precedent, and old world forms and prejudices, and a superstitious reverence for private over public rights, have not yet interwoven round us their inextricable web. The memory, though yearly growing fainter, still lingers amongst us, of those early days in these settlements, when a community of toil, and an almost equality of wealth, bound us all, class and class together, in a strong community of feeling and interest. To us then more than to all others has fate allotted the task of dealing with the problems of the future. By what specific laws, it is not for me now to suggest, but by legislation, I confidently believe, it must be, which must be based on such a reconsideration of the rights of property, as shall tend to redistribute more equally amongst all the joint results of the productive powers of the earth and the creative energy of human labor. That the poor will ever wholly cease out of the land, and crime be heard of no more, we may not hope; but it may be the imperishable glory of the statesmen in these new born nations, so to modify the social and economical conditions of life, that wide spread poverty shall not be the necessary result of artificial law, and crime shall not be bred by the cravings of want, and matured by the sense of wrong.
And if after all it be that our civilization too is destined to fulfil the law of all organic life, and to sink into decay; if the mighty empires of the present must pass away like a tale that is told, we may yet cherish the faith, that from their ashes a new civilization will arise, to which that of the present may be but as the rude institutions of the savage or the tottering footsteps of the child; that man will rise ever higher and higher to those lofty regions of social, moral, and intellectual being, to which the secret and prophetic yearnings of his soul assure him that he is capable page 31 of aspiring, until at last his final destiny is lost to our present feeble sight in the light which shines around the throne of Him, whose image we are, and by whom and for whom all things are and were created,
Edwards and Green, Printers, Wellington.