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The Pamphlet Collection of Sir Robert Stout: Volume 81

Chapter VII. — The Social Problem

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Chapter VII.

The Social Problem.

It now remains briefly to summarise some of the results which mark the progress of the social movement from competition to co-operation, of which the foregoing is a sketch, and discover what lessons they are calculated to teach, and what light they are able to throw upon the confusing quantity of misspent energy wasted upon fruitless political and social controversies amongst us, to the neglect of that honest, intelligent, reconstructive social work of which so many examples abound in other countries, which we, in our lack of appreciation and true conceptions of the nature of things, may look upon as behind us in democratic progress—a very grave error indeed.

Under the heading of "A Bird's-eye View of Co-operation," the Co-operative Union has tabulated statistics which show that from 1861 to 1902—in little more than forty years—the total turnover of co-operative trading in the United Kingdom—distributive, wholesale, productive—had reached the stupendous sum of £1,288,874,494, yielding a total net savings of £123,618,316, which had been returned to members on their purchases, and which, but for co-operation, would have gone as profits into the pockets of private capitalists and middlemen, for whom an organised co-operative society has no need whatever. The rapidity with which the movement is growing may be estimated from the fact that more than one-half of this enormous result has been realised within the last ten years of the series.*

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In an able and well-informed article contributed to the "Arena" magazine for July, 1903, Professor Frank Parsons, of Boston, U.S.A., says:—" Population (in Great Britain) is doubling in about eighty years, whilst co-operative business is doubling in less than a dozen years. In the last forty years—1861 to 1901—population has increased 43 per cent., and co-operative business 5300 per cent., so that co-operation in England has grown more than forty times as fast as her international commerce. When we remember that her international trade and her manufactures are England's special pride, the most important of her competitive business, we may realise in some degree how marvellous has been the progress of British co-operation."

The above prepares us to entertain the highest optimistic views of the capacity of co-operation to solve the social problem. Mr. E. O. Greening is a veteran of the movement, having been closely identified with it since 1856. He took an active part in the establishment of the Manchester Co-operative Wholesale Society, has been a frequent contributor to co-operative literature, and editor of the "Agricultural Economist" since its commencement over 30 years ago. He was the life-long friend of that earnest, pure-minded social reformer, the late George Jacob Holyoake, whose last message to his fellow-workers in the cause of human progress was:—" I care more for co-operation than for any other movement." The utterances of Mr. Greening are, therefore, entitled to attention and respect, and, on the subject of co-operation, are addressed to persons fully capable of checking inaccuracies or mistakes, and who have no hesitation in giving candid expression to their criticisms.

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In an address which he delivered at a session of the annual co-operative congress which met at Perth, Scotland, in 1897, Mr. Greening stated that, whilst the wealth of capitalists doubled in thirty years, it took 150 years to double the wealth of the working classes. "Consequently," he said, "without co-operation the door of hope was almost closed against them. But with co-operation the situation was marvellously changed, and the 'door of hope' was opened to the fullest possible extent." Referring to an estimate made of the total annual income of the wage-earning classes and the rapidity with which co-operative wealth increases, Mr. Greening said:—" If all the working people in the United Kingdom co-operated, we should be able to pay off the national debt in five years, buy up the whole of the railways . . . and the entire country in twenty years. Co-operators would then be their own landlords and their own employers."

And this was not a sensational novelty sprung upon Mr. Greening's hearers in 1897, but a restatement of an estimate made of possibilities with which co-operators were made familiar for more than twenty years previously, which the test of time and experience had strengthened and confirmed.

But the growth of the movement does not await the orderly development of the Rochdale system from distributive co-operation to every form of production and exchange by which supplies reach the consumers. The principle is active in detached forms, developing from a variety of centres, but all actuated by identical motives of economy which, sooner or later, must bring them into uniformity, like patterns in a mosaic, so as to form the co-operative commonwealth conceived by co-operators on the Rochdale principle to be the natural development of a consumer's co-operative movement. Mr. H.W.Wolff has shown that, on the Continent of Europe, a system of democratic banking has been developed, which has enabled small producers, especially peasant proprietors and persons engaged in small agrarian industries, to improve their lands, stocks, and crops; to co-operate in preparing their common produce for markets; in getting advances and page 71 in purchasing requirements on cash terms, without permitting themselves and their industries to be starved by the exactions of middlemen and private dealers, book debts, high charges, and usurious interest. The increase in popular welfare promoted by the adoption of people's banks has been enormous, and, in conjunction with the Rochdale system of co-operative trading, is making the movement an absolutely complete instrument of social reconstruction on the purest economic lines. The latest statement I have seen on the progress made by people's banks and the benefits they confer is by Mr. Wolff in the "Co-operative News" of 8th March, 1905, as follows:—"In Italy, the original home of banking, no doubt banking was developed enough. So it was in Belgium. However, in both countries it was rich men's banking that was established. The poor man looked for it in vain. Credit wanted to be democraticised, as M.d. Audrimont has put it. Accordingly, a system of co-operative banking was organised, which has yielded truly astonishing results. It helps the poorest, provided that he can establish a character and show a legitimate use, and places every year, I suppose, something like £200,000,000 in credits at the disposal of productive and co-operative trade. About 1000 Schulze-Delitzsch banks alone put about £100,000,000 annually into circulation in Germany. Think of that! What a boon to the poor! What a stimulus to production!"

Honesty—straightforward, transparent honesty—forms an essential part of co-operative capital—indeed, a prime necessity, for the co-operation that is a people's mutual self-help movement, and not a combination of capitalists or traders formed for the exploitation of the rest of the community, can only thrive by the exercise of fair and equitable methods. Every departure from principles of strict integrity must be a violation of some economic law necessary to its existence and progress. Every self-help association established for the purpose of effecting economies in production or distribution by which the superfluous middleman, speculator, and private dealer can be dispensed with, however objectless may be the page 72 initial aims of each society beyond the immediate interests of its own members, must, by the tendency to expand which belongs to the principle, help to promote a synthetic movement which, as an ultimate result, will bring producers and consumers into direct economic relationship in a co-operative community. When consumers co-operate to practise economies to gain direct access to producers for supplies, and producers co-operate to practise economies to dispose of the result of their industries direct to consumers, and make a study of their wants, the social problem must be well-nigh solved. This is the individualism of mutual help, the kind of thing of which Daniel Webster said, "Liberty and union, now and ever, are one and inseparable," and which Huxley contrasts with the individualism of "the gladiatorial theory of existence" as follows:—". . . the practice of that which is ethically the best—what we call goodness or virtue—involves a course of conduct which, in all respects, is opposed to that which leads to success in the cosmic struggle for existence. In place of ruthless self-assertion, it demands self-restraint; in place of thrusting aside, or treading down all competitors, it required that the individual shall not merely respect, but shall help his fellows; its influence is directed, not so much to the survival of the fittest as to the fitting of as many as possible to survive." They are the principles of a resistless evolution which are plainly at work, developed from roots as simple as those which move an animal to seek the sun in the cold of winter, and the shade in the heat of summer. Necessarian forces impel the movements; the ability to move constitutes the liberty—the philosophy of Necessity and Free-will in a nutshell—and, as the gifted and philosophic Emerson truly says, "If only the men are well employed in conspiring with the designs of the Spirit who led us hither, and is leading us still, we shall quickly enough advance out of all hearing of others' censures, out of all regrets of our own, into a new and more excellent state than history records."

The struggle of right against wrong is a painfully protracted one. The final triumph, however, cannot be doubted. page 73 The cosmic struggle for existence is "to eat or be eaten;" the eaters—the monopolisers of a people's land, capital, and industries—for the time "survive," and the eaten are the ephemera of the race—also for the time—which class-made laws permit to exist long enough to subserve the purposes of the eaters—which Adam Smith elaborates into a law of orthodox political economy—and then perish to make room for another generation of their kind to be eaten and perish in their turn. But even in this struggle are implanted the elements of organic life by which the laws of life and living come to find gradual recognition, for, as Paul Leroy Beaulieu says, "Everywhere unwritten and unformulated right has preceded written right." The cosmic struggle forms social classes which, sooner or later—the sooner the better—produce class antagonisms, and it is only by class, and not by single-handed individualistic efforts, that class evils, and finally social evils, can be remedied. "Individualism" fails in the very realm of the "individualists" themselves, and the class struggle for human rights, by labour unions and other associations, is the initial stirring of that "organic life" which Max Nordau says "is synonymous with development, . . . the impulse to attain a standard which the organism has not yet reached."

But so long as labour contentions are confined to the modification of conditions which obtain under a system of trade competition, the advantages gained can never be satisfactory nor stable in character. Factory and labour laws have done much to mitigate the evils of unlimited competition, and humanise its practices, but when legislation is depended upon to establish a "minimum wage"—except as a temporary bridge over which to pass on to something better—the law of supply and demand, operative in a competitive system of employment and trade, will assuredly assert itself, however slowly, and decide ultimate issues in spite of all legislative efforts to override it. Neither unionism, nor strikes, nor Courts of Arbitration can compel an employer of labour to pay as much wages as a worker may stand in need of in order to enable him to live and rear a family in tolerable decency page 74 and comfort, should the industry prove unable to afford it. The "minimum wage" may be defined as the adjustment of compensation to labour "to that refined excess" that, though the industry "would break with more," the workers "could not live with less"—a delicately-balanced situation impossible to maintain under a system of competitive trading, even were it possible for one instant to arrive at it. Hence it is that the conflict between organised labour and employers, quite as much as the keen competition between employers themselves, has been instrumental in stimulating the formation of combines and trusts, and the concentration of industrial capital into comparatively few hands. These monopolists accomplish, in a more emphatic and pronounced manner, what ordinary competition does in a less perceptible, but no less certain, way. They select the more energetic and skilful from amongst the workers, and compensate them with a liberality that has little stint in it so long as they are able to give the return expected of them, which is calculated to the last ounce, and taken out of them with mechanical accuracy. This selection—which is characteristic of employment in general, if not always to the same cruel extent—and the employment of labour-saving machinery, lessen the demand for labour in proportion to a supply that is constantly increasing by the extinction of the smaller industries, the drifting of women into the ranks of wage-earners in factories and offices, and the increase of population.

The hopelessness of the situation is felt, and, naturally enough, stands responsible for the demand for a State socialism which, in the optimistic conception formed of it, is to find congenial occupation for all, and ample means to satisfy personal and social wants, under a system of State ownership of the land and of the industries, substituting an all-embracing collectivism for individual enterprise and private capitalism.

As already stated, the ruling classes, at the early stages of State formation, made laws that gave themselves a monopoly of the means of subsistence, which to this day are responsible page 75 for much social injustice and human suffering. In the face of this the demand for State socialism is nothing at all to be marvelled at, or reprehended, and whatever defects may belong to it, conservative anti-socialists and their animadversions can never stop it or amend it. The movement really marks progress in the efforts of the masses, who supply the labour of the community, to emancipate themselves from class-made disabilities, and it is by advancing, and not by retreating, that the discovery has to be made how that great object can be accomplished. It is easy to foresee the decay of initiative to which habitual dependence upon State control would reduce the individual; the great and interminable discontentments and jealousies which must be associated with the allocation of offices and assignment of duties, and the distribution of awards under State-appointed authorities, and the clamours and contentions of rival political agitators and office-seekers, to which these discontentments must afford never-ending opportunities.

Co-operators in the United Kingdom are so sensible of these inherent defects that they decline to be classed as socialists, notwithstanding that their movement has had its origin in the social science doctrines of Robert Owen, promulgated by his disciples, and accepted by every co-operator. Even on the Continent of Europe the improvements which have been effected in the social condition of peoples by the adoption of co-operative methods of self-help in production, trade, and finance, have been so great and obvious that agitation for State socialism is losing ground in its own home, and voluntary co-operation is taking its place as the foundation of a new social order. I have given a greater number of instances of the rise and progress of co-operative societies in the United Kingdom than would be necessary for the mere purpose of illustrating the working of a principle, in order to impress upon the minds of wage-earners, if I can reach them, the all-important fact that co-operative success is not a chance work, but the assured result of plain common-sense, and entirely practicable methods. By voluntary co-operation the page 76 working classes in the United Kingdom have saved up many million pounds' worth of wealth for themselves, and in the process have acquired, and continue to acquire, industrial, commercial, and financial experiences, and mental and moral attributes, and capacities for practically grappling with every social problem, simple and complex, as they may present themselves, and for clearly distinguishing between the cooperative duties which concern citizens as private individuals, and those which pertain to municipalities and States in those matters in which the people as a whole are more collectively interested. Mr. F. Maddison, a trade unionist, and Labour member of the late British Parliament, who was returned again at the recent elections, speaking at the opening of new co-operative branch stores, well said:—" Those things that could not be grappled by voluntary co-operation are the only things which the State should touch." Co-operation is a movement which begins with the people, is conducted by the people, and by the introduction of its principles and methods into municipal and State life, it is eminently calculated to afford a guarantee of economy, efficiency, and purity in the administration of affairs, impossible to realise under the régime of competition or monopoly, or under a system of government that would make the people dependent upon the State for employment and means of living.

* Just as this little work was being prepared for the press, statistics under this head had come to hand as follows:—

"From 1861 to end of 1905 the trade of the co-operative societies amounted to £1,564,743,610, and the profits derived from that trade reached the enormous total of £153,118,706."—(Inaugural address by Mr. J. C. Gray, general secretary of the Co-operative Union, opening the 38th Annual Co-operative Congress, which met this year (1906) at Birmingham.)

Comparing the data given in the text with these later returns, it will be seen that in three years' time, to end of 1905, the total co-operative trade turnover was £275,869,116, and the profits—that is, the net profits for distribution upon members' purchases—were £29,500,390.