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THE LIBRARY

OF

THE UNIVERSITY

OF CALIFORNIA

LOS ANGELES




THE LIMITS OF STATE
INDUSTRIAL CONTROL



\



|V



INDUSTRIAL
RECONSTRUCTION

A Symposium on the Situation

after the War

Edited by Huntly Carter

Crozvn Svo, cloth 6/. net.

" The whole subject is treated in a
broad, reasonable spirit, and there is much
that is far-seeing and helpfully suggestive
in the tentative programmes that are laid
down for re-building the world when peace
returns to it." — Bookman.



AN ALPHABET
OF ECONOMICS

By A. R. Grace, editor of " The

New Age"

Crozvn 8fo, cloth 4/. dd. net.

In view of the certainty that economic
questions will occupy a prominent place
during the coming reconstructive period
in public discussions, a work, such as this,
at once popular and positive, is indis-
pensable to the student of affairs,

T. Fisher Unwin Ltd., London



THE LIMITS OF STATE
INDUSTRIAL CONTROL

A SYMPOSIUM ON THE PRESENT
SITUATION & HOW TO MEET IT



Edited by HUNTLY lCARTER



T. FISHER UNWIN LTD.
LONDON: ADELPHI TERRACE







First published in igig



{AU rights reserved)



HD
Q7C.



PREFACE



iO,



J^The following matter is the outcome of an attempt to learn

'^the views of a number of representative public persons in

^this country on the urgently pressing problem of "State"

S Control. It has long been realized that the problem is one

— iof the greatest the country has to solve. And it is now

realized that the war has given it a prominence which entitles

it to first consideration during the coming readjustment and

reconstructive periods.

The questions submitted were as follows : —

1. What in your opinion will be the situation immediately

after the war as regards State Control ?

2. What in your view is the limitation of State Control

to be maintained ?
^^ 3. What in your view is the best policy of control to be
35 pursued in the highest interests of commerce, trade

■^ and industry ?

r-f These questions invite, it will be seen, opinions upon the
2 control situation produced by the war, and as it will appear
^ when peace is signed, and upon the negative and positive
aspects of the immediate future of Government Control.
Though the answers appear fragmentary, as by the form of
the inquiry they are bound to do, they will be found to contain
a fairly complete and sufficient answer to all three questions,
and to some extent a constructive criticism both of the theory
and practice of Government Control by distinguished men
and women who are all qualified by expert experience to
make it.

I may say that it is not part of the purpose of this preface
to criticize the contributions. Nor is there space adequately
Sto summarize them. But perhaps a word may be said about
o their arrangement, and an indication given of the nature of
-a: the varied opinions from which there emerges a general con-
clusion. The conclusion is that an intelligent policy of control

5



38G798



The Limits of State Industrial Control

is needed, and the sooner this country gets it the better. In
other words, the Government will spoil the country if they
continue their war-time meddling in business and private
affairs.

In arranging the contributions I have followed my usual
plan — one that always seems to me simplest and clearest —
of placing contributors in the order of their special interests.
Thus they fall naturally into well-defined classes, each with
a special interest of its own, yet related to all the others by
common interests. I do not expect this arrangement to meet
every one's approval. Indeed, I am prepared to hear some
one say that I have not rightly placed every contributor,
seeing that there are many-sided specialists who belong to
more than one speciahsm, and there are other specialists
who do not deal with their specialism. I dare say this is a
just criticism, but it is an answerable one also. I think it
is a general law that a many-sided person of great ability
has a predominant interest to which all his other interests
are subordinate, just as he has a predominant emotion upon
which his emotional system may be constructed. Take Mr.
Bernard Shaw, for instance. He is a many-sided person of
great ability who has a predominant interest, viz. socialism,
just as he has a predominant emotion, viz. sympathy. Mix
the two, add the ingredients of a very varied expression,
and you have the complete Shavian Temple of Socialism
from the first breath of the Fabian Essays to the last sigh
of Man and Superman.

It is true that some contributors do not keep to their
specialism. This neglect to talk shop is, however, not neces-
sarily a proof that the specialist has abandoned his trade or
profession. What it means is that an expert in, say, finance,
has expressed himself on the question of Government Control
and has left it to be inferred that his conclusion is that held
generally by leading financiers. So it may be said that
whether or not it is an opinion related to a special interest
that the contributor expresses, he remains strictly in his
own class. Therefore each group of contributors may be
taken as expressing an authoritative body of opinion that
indicates the attitude towards Government Control accepted
by that group. Any one who cares to look at each group
in turn in this way will find the process a fruitful source of
conclusions. It will provide plenty of choice between theories
and policies of Government Control expressed on behalf of
the people, and the governing and educated classes.

6



Preface

Possibly the chief interest of the book lies in the diversity
of opinion concerning the present-day cause and effect of
control, and the policy to be pursued. The most important
causes of control may be divided into six groups, metaphysi-
cal, philosophical, political, social, economic, and industrial.
The metaphysical, found in Free Will and Determinism, and
the philosophical bound up in the eternal question why man
needs control, and what fundamentally controls him — these
causes do not immediately concern the contributors. There-
fore they have proceeded to the other four causes more closely
connected with the subject of my inquiry.

Though I did not invite discussion of metaphysical and
philosophic points, it is perhaps permissible here to consider
a more intricate matter connected with the origin of control.
By some social and industrial reformers it is thought that
nowadays Government Control is the outcome of popular
desire — the desire for liberty only to be obtained by an in-
telligent policy of control. In other words there is a desire
for liberty in control — strange paradox ! Those who look
deeper are, however, aware of the fundamental fact that men
are largely and permanently controlled in their thoughts
and actions by the word liberty, not by the true ideal which
it contains. In fact to-day our most valued asset is words,
not the ideals which they inform. It is true that our fore-
most writers and thinkers are continually talking about ideals.
It is true also that the realization of ideals seems to be the
object of their life. But actually they are engaged uttering
sounds which we call words and phrases, without any sense
of their meaning. State, Liberty, Authority, Democracy,
Association, Capital, Labour, People, Peace, Power, Empire,
League of Nations, Patriotism, Reconstruction, Control, — all
these formative words what do they mean to most people ?
What do they mean to statesmen and politicians ? What
do they mean to that immense crowd of perspiring persons
who to-day give them more prominence even than newspaper
posters ? Ask any of them what ideal in any of the words
is being discussed, and we must come to the conclusion it is
not the vital ideal that originally established the word. It
is one of those periodical revisions of form which change of
circumstances is permitted to impose upon words. So it
comes about that whatever men may say or think, words,
not ideals, are the greatest force in the world just now. They
move men perhaps more powerfully than thej^ have ever
done, and they move them in a wrong direction. The reason

7



The Limits of State Industrial Control

why they do so is that men are actuated by their emotions,
and their emotions respond to the meanings conveyed by
words. So, actually they are moved by the false meanings
given to established words by the said application to wrong
concrete experience. For example, the word patriotism has
been revised to suit the requirements of war-time chauvinism,
with the result that chauvinism is enabled to usurp and hold
the position which by right of necessity, which first brought
the word into use, was intended for patriotism. The same
may be said of many other words that dominate in politics
and economics. In particular there are the three survivals
of the lawyer-made French Revolution. Strictly speaking.
Liberty, Equality and Fraternity are the invariable signs of
old age, yet they dominate all departments of new-age thought
to-day. They are the arbiter of peace, the creator of a new
world, the patron saint of religion, art, drama, literature,
the saviour of society and the redeemer of home and foreign
politics. Combination, Concentration and Control are the
current signs of abundant youth. This is the Trinity that
England most needs. And when we come to think of it,
it is one for whose duties Liberty, Equality and Fraternity,
in the strict sense, are especially unsuited. Considered in
the light of this reversal of duties it is reasonable to conclude
that the evil that words do lives after them, whilst the good
is often interred with their bones. Or, to put it shortly,
words are the present-day root of all evil.

From the discovery of this present verbal cause of control
it is not difficult to pass to the discovery of the present nature
of control, and beyond this to the inevitable effect. The
whole thing is simply an adventure in the wide domain of the
logic of the absurd. One can picture loud laughter revolving
round the ultimate displacement of ideals by words, and
the amazing situation produced by this sort of up-to-date
folly and vanity taking over the control of men's affairs.
Fortunately there are signs that mankind will not be per-
mitted to penetrate too far into the absurd without an effort
being made to rescue them.

Settling on the surface of the new civilization are persons
capable, it would seem, of adding touches of a permanent
value. To these, significant words appear as the bearers of
ideals designed by nature and intended for the guidance and
salvation of men. Such are the French Regionalists who
have long made it their business to release the true ideal in
the word regionalism, and to set it to work to shape the actual.

S



Preface

Thus we see emerging from " regionalism " the social-indi-
viduahstic ideal of a natural or place-sanctuary for creative
impulse. Such too are the leading members of the English
Sociological Society who have, for some time, been preoccupied
with the true ideal contained in the word City, which, to them,
appears as an organic or people-sanctuary for the full and
free expression of creative citizenship. And such are the
English National Guildsmen who are actively engaged ex-
tracting the true ideal from the word Guild, to which
necessity originally gave the meaning of a functional or
work-sanctuary for creative occupation.

The desire to find a direct cause of control in the creative
content of words, and to place men under the control
of creative impulse and function, is referred to in the
sections on Sociology and National Guilds. In Mr. Victor
V. Branford's important article the civic control issue turns,
it will be seen, upon the restoration of the word City to its
original meaning, sense and significance, as the State, that
is, the City-State of the early Greeks at their highest and
best. Sir Hugh Bell also suggests that the present-day use
of the word State rests upon a misconception. It is hardly
necessary to say that it is to Mr. Arthur J. Penty, who con-
tributes to this symposium, we owe the restoration of the
ideal to the word Guild. The ideal as released by Mr. Penty
first appeared in his Restoration of the Guild System . This
book was written to expose the fallacies of collectivism and to
recommend the Guild as the type of organization on which
industry shall be reorganized. The pursuit of the ideal was
continued in Old Worlds for New, which was written to
develop it and its group of ideas. In his third book,
Guilds and the Social Crisis, recently published, he turns
more in the direction of policy in order to show the
influence of the war upon Guild policy which, accordingly,
he brings into relation with the problems of readjustment
and reconstruction now confronting this country. The
doctrine of Guilds, as outlined by Mr. Penty, is implied
in most talkings and writings on National Guilds, and the
literature of the subject, as yet limited to a few books, pam-
phlets, and a number of newspaper articles. This literature
is, however, sufficient to confirm the belief that the Guild
ideal as set forth within recent years is one accepted by a
number of live persons who are entitled to speak with author-
ity on the Guild theory and practice of industrial economics,
and to prove that the word Guild has become more or less

9



The Limits of State Industrial Control

a pledged word — pledged to the immediate purpose of trans-
forming the world of labour. If we turn to that very able
piece of descriptive interpretation, The Meaning of National
Guilds, we shall find that the Guild ideal has reached the
point where Guildsmen are seeking to set it to work, and are
grouping themselves in more or less critical alliances possibly
only for the temporary purpose of disagreeing on method
till they can hit upon a common one. But it would seem that
during this inevitable period of babble and Babel practical
proposals of great moment continue to emerge. For example
there is the scheme of Mr. J. Paton, the editor of The Guilds-
man. I fancy his proposal to set up a Collective Contract
between employer and employees will, in the long run, be of
more substantial service to industrialists than most of the
other Guild schemes put together. It may be mentioned
here that a scheme of Collective Contract is being considered
in France by industrial economists. The point under con-
sideration is whether syndicates of employers and employees
should be left to unite spontaneously in a collective contract,
or whether associations should be governed by laws.

I have dealt with that cause of control which may be said
to be the direct outcome of human necessity. And I have
suggested that if this cause is neglected or perverted the effect
will be proportionally false and destructive. In fact, to
eliminate the true ideal from the word is to set Satan mas-
querading in sheepskin. As to the other four causes of control,
political, social, economic, and industrial, I need speak only
briefly. To begin with, it should be observed that, broadly
speaking, these causes represent three predominating desires,
individualistic and collective, or roughly libertarian and
authoritarian. There is the extreme desire to control the
Many in the interests of the Few, the extreme desire to control
the Few in the interests of the Many, and the compromise
found in the desire to control the Many in the interests of the
Many. These desires will be found underlying or openly
expressed by the contributions in this book. Hence arise
questions of first importance. There is, for example, the
political question whether the Government should be the
cause or effect of social control ? Should the Government
be the instrument of Society or Society the instrument of
the Government ? The views expressed by the leaders of
the Government, inasmuch as they embody popular senti-
ment, appear to uphold the theory that society controls the
Government and directs them in its interests, that is so far

10



Preface

as domestic affairs are concerned. I dare say some person
will remind me that this is taking a very hopeful view of the
present Government. For if it is true that the Government
do appear to lean towards popular opinion, it is true also
that they have appropriated the instrument of evasion for
their own convenience. Perhaps therefore it would not be
incorrect to say that the Government is composed of persons
who represent themselves and misrepresent others.

The other causes out of which control may arise are
concerned also with vital questions. First among contem-
porary economic causes is undoubtedly money (or money-
capital as it is sometimes called). Hence the question, how
shall money be controlled so as to become a vital factor of
national life. How is it to be organized so as to be set circu-
lating in a vital manner throughout the arteries and veins
of the whole nation considered as one man, instead of being
confined to extremities only. The answer occurs in the recog-
nition of the rights of the Few, the organizers, or the rights
of the Many, the producers, or the rights of both combined.

Closely connected with this economic cause of control is
that of labour (or energy-capital as it might be called). Here
the question is whether the worker ought to be the cause
or effect of his work, whether he is to control the means of
production in the interests of himself and the Many, or be
controlled through them in the interests of the Few ? Be-
sides this there are the two questions of competence and
confidence. What is the precise mental condition of the
worker to-day ? Does it entitle him to have full access to,
and complete control of all the natural resources that should
be the common property of mankind ? Or is it true that
at the present moment Labour suffers from overmuch heart
and too little brains, just as Capital is said to suffer from
overmuch brains and too little heart ? Is it true that when
we come to examine the working-class mind we find that
Labour is no more than a combination of aspiration and
perspiration ? Assuming that the worker is not mentally fit
to take over complete control, but is capable of participating
in management, and should participate in profits, we then
have the question, how is harmonious participation to be
attained ? What will remove the cause of friction between
Capital and Labour which has led up to the prevailing war-
like situation ? We know that the situation rests upon mutual
suspicion. The masters lack confidence in the men, and
the men lack confidence in everybody. Consideration for

II



The Limits of State Industrial Control

any one outside their own class is regarded as moral cowardice.
Of course no one should say that the workers ought not to
enter into control because that system has not been tried.
What ought to be said is that no new system of industrial
control should be tried till the industrial egotism and mis-
trust that provokes unnecessary class war has been swept
completely away. So, much valuable time and energy will
be saved for advance. Control like charity begins at
home.

A predominant cause of control appears in environment.
To-day men have no real control over their own surroundings,
but are largely and injuriously controlled by them. This
has been seized upon by sociologists as an excuse for an at-
tempt to reverse a very unnatural order. What immeasur-
ably greater independence of thought and action, they say,
there will be under the inspiration of surroundings that are
primarily the outcome of clearly comprehended and reason-
ably controlled desire. This change, I agree, is desirable.
But it is as difficult as yet to foretell whether it will bring
society permanently nearer the millennium of social control
as it is to say whether a woman Prime Minister will cause
the political millennium. The most one can say at present
is that control is like a brilliant of many facets, the true
experience of men is the light that gives it full effect. The
business of men is to take care of the true experience, and
control will take care of itself. This true experience, in the
form of creative ideals, is to be found buried in words. The
moral is, be careful that you handle words to mean truth,
and do not let periodical revision rob them of their Gospel
verity.

There is the effect of control to be considered. Arising
from effect is policy which, in turn, becomes a cause of control.
It is towards conclusions whether policy should be dominated
by statesmen, by the governing class, or by the people, that
each symposeur contributes an opinion. The effect of control
upon business and labour is also fully dealt with. On the
historical side. Miss B. L. Huchins contributes an article
of extreme interest. On the contemporary side Mr. John
Hilton provides an able summary of the immediate pre-war
and war-time situation. Though the article does not directly
discuss the questions set, it furnishes valuable facts on the
situation and how to meet it that distinctly belong to the
subject of control. It should be said that the article has been
revised and brought up to date for inclusion in this book.

12



Preface

The greater part of it first appeared in The State and Industry,
composing the fourth volume of the Reorganization of In-
dustry Series pubhshed by Ruskin College, Oxford. This
series of reports of representative working-class conferences,
with discussions of the lectures and the lecturers' replies,
form a very valuable summary of the question of reorganiza-
tion from the Labour point of view.

As to the war-time effect of control in producing a bureau-
cratic web, that comes in for deservedly severe censure. The
possible effects of post-war control cannot of course be esti-
mated till it is known whether the nation is to be freed of
war-time conditions and consequences which practically amount
to a revolution. Some possible effects are forecast by Mr.
Bernard Shaw, whose article, by the way, was torpedoed on
its way from Ireland to London. Neptune will no doubt
find the forecast a very fine subject, if it is not rather too much
for him. Mr. John Zorn throws out a number of stimulating
conclusions. In the present age of democratic thought it
is next to impossible to predict from remaining specimens
of European monarchs whether an annual king is desirable,
but Mr. Zorn suggests that we should have one. Mr, Robert
Williams's observations lead us to see to what extent the Trades
Unions are in favour of nationalization as a form of control.
What nationalization is really capable of doing, is not very
clear as yet. To some alert minds it appears as a kind of
camouflaged Dora. Perhaps the mystery itself is too profound
for the present stage of human insight.

As the omission of one or two authoritative names from
the book may be noticed, let me say it is not due to any re-
luctance on the part of representative men and women to
oblige me with their opinions. Indeed I owe sincere thanks
not only for the contributions, but for the courtesy and con-
sideration I received from every quarter from which I invited
contributions. As will be seen in a glance at the list of con-
tributors, the contributions, besides being marked by ex-
treme ability and authority, have come from very busy
persons, all of whom have turned from pressing work of im-
mediate importance, to honour me by acceding to my request
for their views. Only two or three intending contributors
were prevented from taking part in the symposium. Mr.
H. G. Wells, finding that he was unable to turn aside from
immediate commitments, wrote regretfully that he was unable
to avoid his omission. And Mr. G. K. Chesterton would gladly
have serit an expression of his views but for the great anxiety

13



The Limits of State Industrial Control

in which he was involved by the most regrettable illness and
death of his brother, Mr. Cecil Chesterton.

Nine of the replies contained in the State, Capital and
Finance sections originally appeared in symposium form in The
Organiser. Four of these have been revised and expanded


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Online LibraryHuntly CarterThe limits of state industrial control; a symposium on the present situation & how to meet it → online text (page 1 of 17)