Charles Richmond Henderson.

Citizens in industry online

. (page 1 of 22)
Online LibraryCharles Richmond HendersonCitizens in industry → online text (page 1 of 22)
Font size
QR-code for this ebook











Copyright, 1915, by


The feeling of social responsibility which char-
acterizes our day has led to severe criticism of
various phases of our modern world, and to innum-
erable plans for social reconstruction. In con-
sequence, the actual achievements of social better-
ment have been frequently overlooked in our sense
of imperative tasks and our distrust of Utopias.
Nevertheless, steady advance has been made in cor-
recting evils and in establishing laws, institutions,
and precedents looking toward the genuine improve-
ment of social conditions. The present series of vol-
umes undertakes to describe accurately this advance
for the general reader. Although written by spe-
cialists in their particular fields, the plan and method
of each volume are not technical. The great reading
public has been pretty thoroughly informed as to
our social liabilities; the present series will list our
social assets. Such a presentation it is believed will
not lead to a complacent optimism, but will serve
to reassure the rapidly growing class of those who
are ready and even eager to join in all practicable
efforts to right evils but who, at the same time, wish
to maintain the continuity of social evolution.

Shailer Mathews.



This volume is Dr. Henderson's last contribu-
tion to the cause to which he devoted his life. The
last work in which he was engaged was the reading
of its proof.

The service which Dr. Henderson rendered the
cause of human welfare was largely in the field which
this volume covers. True, his interests covered also
the fields of penology and charity, but few men of
our day have a more accurate knowledge of the
conditions affecting the workingman. He was
called repeatedly into service by his city and his state
to help solve industrial problems as well as serving
as the representative of the United States upon the
International Prison Commission. His attitude to-
ward the problems of our industrial order was a re-
markable combination of the scientific spirit and
warm personal sympathy. There are few men who
have given themselves as generously or more intel-
ligently to the needs of their fellow-men, and his
death was largely due to his efforts as chairman of
a commission appointed by the Mayor of Chicago to
relieve the condition of that city's unemployed.



It is a cause for profound gratitude that in the
midst of his overcrowded life he found time to write
the summary of the efforts that are actually being
made to better the situation of the wage-earners
throughout the world.


I. The Situation and Its Problems . . . i

The great industry — Welfare work — Outline
of organization and activities along industrial bet-
terment lines: South Works of the Illinois Steel
Company, South Chicago, Illinois — Governments
as employers — The transition from philanthropy
and welfare schemes to social legislation.

II. Health and Efficiency: The Fundamental

Interest of All Citizens . . . .48
The national interests affected by efficiency of
workmen — Safety devices — "Safety First" — Dis-
ease — Various hygienic measures in the work-
place — Cost and gain of safety and health meas-
ures — Organization of capitalist managers to pro-
mote safety and health — New problems for the
nation to face.

III. Economic Inducement to Secure Effi-

ciency OF Labor 117

Profit-sharing — Thrift measures encouraged by
managers — Compensation is satisfactory.

IV. Methods of Improving the Conditions of

Home Life of Employees . . . 168

Family and home of employees — The dwelling a
primal necessity of life — Benefits of improved hous-





ing — A suburban plan — Conditions of successful
plans — Standard for dwellings — Legal obstacles —
Cooperation with municipalities — Inspection and
control of dwellings — Octavia Hill methods.

V. Neglected and Homeless Youthful Em-

ployees 187

Responsibility — Homes for working boys —
Working girls' homes.

VI. Education and Culture .... 200

Vocational education — Liberal culture.

VII. Experiments in Industrial Democracy . 234
Political rights of the w\ige-earner — The de-
mand for self-government in the shop — Training

for self-government: representation in manage-
ment, building and loan associations, education in
political science, neigliborhood centers — Organiza-
tion and administration of betterment methods
within an establishment or in a trade on a volun-
tary basis — Seeking for a basic principle of agree-
ment — Economic wages — Arbitration — Attitude of
the American Federation of Labor toward arbi-

VIII. ^Administration of Welfare Work and

THE Social Secretary .... 266
Functions of social secretary — The social secre-
tary in relation to the principal — The personal re-
lation between employer and employee mediated by
the social secretary — Natural qualifications of a
welfare or social secretary — Educational prepara-
tion of a social secretary for an industrial estab-



lishment — Health conditions: direction — Women
secretaries — The ideals of the "capitalist managers"
— Educating business managers in social politics.

IX. Moral and Religious Influences . . 288
The moral standards in industry — Religion:
dangers and obstacles — Libraries: advantage and
disadvantage — Protection of girls in work-places —
Farming out the task — Methods of Y. M. C. A.
in industrial camps — The church — Ideals and

Appendix. List of establishments which have organ-
ized welfare work . . , . . .315

Bibliography 329

Index ......... 339


The title is chosen to indicate the point of view.'
It is now generally agreed that all feudal, patri-
archal, patronizing factors in industry must be
eliminated. One of the achievements of the In-
dustrial Revolution was to take the wage-earner
out of the control of "status" and secure to
him the dignity, security and personal responsibility
of "free contract" in a political and legal regime of
equality before courts, legislatures and pubhc ad-
ministration. Workingmen are justly sensitive to
any hint of return to serfdom; they resent any at-
tempt on the part of the employer to direct them in
their enjoyments, studies, creeds, worship or political
action. They say they want "justice," not "charity."

The patriarchal, feudal relation between employer
and employee, which is disappearing in Europe and
altogether absent in America, survives in Japan and
retains much influence there. The legal protection,
even since the factory law went into effect, is very
meager; the care of the workers depends on the char-
acter and disposition of the managers, which vary

The Hon. Kojiro Matsukata (D.C.L., Yale), a
distinguished manufacturer, proprietor of a news-
paper, and statesman of Japan, recently said :^

^ Japan's Message to America (1914), p. 117.



"There is in Japan a social relationship between em-
ployer and employee that does not prevail in your
country. It is the relationship of lord and retainer.
For many centuries, Japan was under a feudal sys-
tem where the giver of 'rok' (or annual pension)
was the lord, while the recipient of it was the
retainer. Such feudalistic relations between payer
and payee have not yet altogether died away in this
country, though they are gradually diminishing with
the capitalization of labor. Even to-day, he who
pays wages is allowed to assume something of the
mental attitude of the lord — not in a despotic but in
a protectoral sense — toward those who receive them.
A young man who was earning his school expenses
by work in America came into possession of a lengthy
letter from his mother left behind in Japan, repeat-
edly advising him to be loyal to the person of his
master; and he looked around to find to his renewed
surprise that nobody would claim in the Republic
such personal loyalty as his good old mother must
have meant. But in Japan there exist many subjects
for this quasi-feudalistic virtue. . . . My American
readers may think that the comparative scarcity of
strikes in Japan is due to lack of self-assertion on the
part of the laborers ; but that is not quite right. The
chief explanation must be found in their active loy-
alty to their employer's person, rather than in their
passive forbearance." Rare and faint are the sur-
vivals of this feudal feeling in America.

Our workmen demand "justice," but justice needs
a definition; it is a vague word and is used with



various meanings. For our present purpose it
means "good citizenship"; conduct which furthers
the life process, which promotes the common wel-
fare, which harmonizes all interests, or tends to do
so. The word "citizen" implies legal and political
equality, common rights and reciprocal duties, obli-
gation to further the life of the entire people. The
special relation of employer and employed is indi-
cated by the word "industry"; since the general
principles of social obligation are here to be applied
to the contacts and contracts required by the process
of producing commodities for the world's markets,
for the satisfaction of human wants. No hint of
personal superiority or inferiority is suggested by the
title "Citizens in Industry," and it clearly describes
the relation of employer to employed and of both
to the city, state and nation. The word "citizen"
also points to a common brotherhood in the realm of
ideals, of eternal values.

"Citizenship in Industry" is suggestive of proph-
ecy; it intimates that the modern worklngman never
can be morally content and satisfied as long as his
mind, will and voice count for nothing in the direc-
tion of the industry and its product. He may not yet
be adequately prepared for that responsibility; his
ambition may outrun his education, but he is looking
forward to it, and he chafes while he waits. ^

^Shadwell: Industrial Efficiency, i, 177.

"The reign of the benevolent employer is over. He gets
no thanks, and the tendency is all in the direction of secur-
ing such conditiofis of employment as will enable the em-



The illustrations of methods and principles in this
book will be drawn from a vast mass of actual cases.
While advertisements of particular corporations will
be avoided or minimized, specific examples must be
used to give concrete form to the discussion. If it
were attempted to describe all the known schemes of
particular establishments in detail, the result would
be confusion, duplication and just complaint of par-
tiality in selection. It seems wiser to present the
results of the study of many establishments in com-
pact form, the principles which underlie the whole
movement, the inventions which are still in the ex-
perimental stage, and the problems yet to be solved.

The conclusions here offered are based on numer-
ous personal visits and interviews not only in Amer-
ica and Europe, but also in important establishments
of the great industry in India, China, and Japan,
where European examples and models have been
adapted to Oriental conditions. No one country

ployed to provide their own benevolent institutions." ii,

"Voluntary institutions may be, and often are, more ad-
vantageous where they exist; but they affect such a very
small proportion of the industrial population — a few pin
points in a fifty-acre field — that they hardly count in a gen-
eral comparison.

"What labor demands in a modern community is not
favors, but justice; not gifts, but a fair share of the takings,
with the means and the opportunity to provide its own wel-
fare institutions. In itself that is a sound, wholesome and
proper aspiration, inseparable, indeed, from the organic
development of society,"



has a monopoly of patriotism, public spirit, be-
nevolence, and invention. Ideas quickly travel
across land and ocean. The magazines and
books which announce new methods of philan-
thropy are now found in the Parsee, Hindu
and Mohammedan counting-rooms of millionaire
manufacturers of Bombay, Calcutta, Madras, La-
hore, Shanghai, Tientsin and Osaka. The diffusion
of the ideas of "welfare work" in the Orient is ex-
tremely interesting. One of the most hopeful enter-
prises of young China is the Commercial Press of
Shanghai, publishers of educational books, employ-
ing 1,400 persons, with a payroll of about $20,000
per month. The buildings are large and commodi-
ous, well lighted and ventilated; sufficient ground has
been reserved for the recreation of the employees.
About four hundred women and girls are engaged in
the bindery and elsewhere. They are permitted to
leave the establishment five minutes before the men.
A woman Is allowed a vacation with full pay one
month before and one month after confinement.
This establishment is one of the strongest centers of
education In China and It sets an example which will
be imitated wherever the great Industry makes con-
quests. Wages are good; a bonus is given in propor-
tion to the record and importance of the employee's
service, and a certain allowance is set apart as pen-
sion for the old retired employees or the family of
the deceased. The system of profit-sharing is intro-
duced and the key men of each department are share-
holders of the company. Clean and comfortable



blocks of dwelling-houses can be rented at moderate
prices. School privileges from kindergarten to high-
school training are maintained for their children.
An evening school is also kept for the younger mem-
bers of the firm, and a self-improvement club, with
school facilities, has been opened under the patron-
age of the company. A small hospital is established
for the sick employees. Nine hours' work and Sun-
day holidays are features seldom found in Chinese
workshops. While this attractive example is rare in
China, it is prophetic and will be influential as the
Great Industry makes its way.^

A list of many books and articles is appended
which will enable the reader to go much further into
special questions than the limits of this book permit.
This list is at least a partial acknowledgment of the
author's indebtedness to other investigators and
students and will be a partial guide to travelers
studying "welfare work," or students who wish to
secure further details.

If some practical man objects to a discussion of
such a practical subject from one who is confessedly
a theorist dwelling in an academic atmosphere, the
apology may be offered that such a student is natur-
ally as free from partisan bias as anyone can be
who has convictions, and that the scientific habit of
patient collection of facts and criticism of materials
may be some assurance of reliability. "Theory"
does not mean a dream or a guess, but a broader
view of the facts under consideration and a search

^ Information furnished by Mr. Fong S. Sec.


for causal connections. Practice Is blind without
theory to guide It by a vision of ends and ways, and
practice needs the rational justification by proof
which a sound theory affords. In Goethe's "Faust,"
the popular scorn for "academic theory" is expressed
in the oft quoted lines :

Gray, dear friend, is all theory.

And green alone the golden tree of life.

But those who cite this passage from the great poet

sometimes forget that "Goethe knew very well why

he put these words in the mouth of the Devil." ^

^See Dr. R. von Erdberg: Das Programme der Wohl-




I. Industrial evolution has advanced through
many stages and forms of organization,^ Primitive
industries of fishing and hunting passed into pastoral
and agricultural occupations. Cannibalism was tem-
pered by domestication of captives as slaves. Serf-
dom gave the workman a measure of possession but
bound him to soil and master. The system under
which we live is complex and varied; for the house-
hold industry survives in a great part of the earth
and competes with the immense shops which are fur-
nished with the finest machinery and steam power.
In the great urban centers of manufacture the cap-

^ For details see Biicher: Entstehung der Volkwirtschaft
(Development of Industry).

G. Schmoller: Grundriss der Allgemeinen Volkwirt-

Herkner : Die Arbeiterfrage.

A. Toynbee: The Industrial Revolution.

Von Zwiedeneck-Siidenhorst: Sozialpolitik.


Citizens in Industry

italist management system is monarch, and it has
transformed the face of the world. It already shows
defects and signs of failure and transformation; the
Socialists are ready to inform us that a substitute has
been found in their methods; while poets and seers
already Imagine a system which will supersede So-
cialism. No organization is permanent; all is fluent
and transitory; but just now we have to work with
the capitalist manager whose achievements are
praised, whose faults are cursed, but whose seat on
the throne at present is firm. Under this modern
system we have not only private propert}% but con-
trol of property used in production in relatively few
hands, with a tendency to further concentration of
commercial power.

The industrial group is composed of a multitude
of operatives and their families. These men are
equal with their employers before the law, have po-
litical power in proportion to their numbers, if they
know enough to use it; but in the work-place they
are subject to the commands of men who, being in
control of all the materials and instruments of pro-
duction, hold over them literally the power of life
and death, except so far as this power is restricted
by fear of strikes, humane sentiment, or by regula-
tion of law.

2. The great industry, in its social aspect, is a
form of cooperation between capitalist managers
and operatives for the production of goods wanted
by the community.^ The immediate motive on one

^ J. A. Hobson : Work and Wealth.


The Situation and Its Problems

side is profits, on the other wages, and what these
will buy.

The modern great industry is, from the social
point of view, an organized method of cooperation
in production; individuals find it a divider of men
into hostile camps. This paradox arises from the
fact that the elements in production must combine
or be sterile — land, labor, capital and management.
Isolated they are barren; only in cooperation do they
bring forth commodities which satisfy human wants.
The contradiction is real, not imaginary. The very
situation gives occasion for friction, irritation and
conflict. The employer and capitalist manager estab-
lishes a business to gain profits; if labor costs him
more, profits are less; at least it seems so to the
paymaster, and sometimes this is true. The very
phrase "labor cost" means different things to the
men in opposition: to the manager it means money
paid out for wages, possible abstinence from lux-
uries and risk of the investment; to the worker it
means sweat, toil, weariness, pain, danger, exhaus-
tion, a daily surrender of vitality.^ The antagonism

* J. E. Cairnes: Some Leading' Principles of Political
Economy (1874), p. 75. The "cost" of labor involves the
elements of duration, severity or irksomeness and risk of
injury. "In the usual exposition of the doctrine of cost of
production the only risk taken account of is that incurred
by the capitalist; but this is merely a consequence of that
habit of contemplating the work of production exclusively
from the capitalist's standpoint." Compare J. A. Hobson :
Work and Wealth, ch. v, where this idea of Cairnes is devel-


Citizens in Industry

of interest may be softened, modified, attenuated;
it cannot be entirely removed by any means yet dis-
covered. Rough justice must ever take the form of
estimate and compromise, until social science can
make its calculation of values much more exact than
it has yet been able to do, and laws and legal tri-
bunals have been evolved for an equitable division
of the product. The most advanced employers will
try experiments which will help to supply the data
for a judgment when the time is ripe for law.

There are cases where the laborer is fully recom-
pensed for more costly self-sacrifice by corresponding
advantages; and there are situations in which the
employer finds higher wages and better conditions
to be a wise and paying investment. But the area
of advantage in expenditure is limited and its
boundary soon reached; then a real conflict must be
openly faced and a tolerable compromise accepted as
a condition of continued cooperation.

In strikes and lockouts we see the antagonism in
flame; but the ashes which conceal strife are never
quite cool ; the volcano always rumbles and smokes
so long as there is a hot place down below. Socialists
tell us that the conflict can never cease until the
whole people, through some form of representative
government, controls the process and the distribu-
tion of the product over which the battle wages;
but that question is for the future.

3. The compromise of mutual understanding is
reached with more difficulty partly because the great
industry has made personal relations difficult or even


The Situation and Its Problems

Impossible. In the petty relations of fishing, agri-
cultural and village industries, master and man talk
out their difficulties while both are toiling side by
side. The journeyman knows quite closely the
profits of his master and what it is possible for him
to pay in wages. But in a great steel mill, or on a
railway, the capitalists are thousands of unknown
stockholders, the managers are great men in ma-
hogany furnished offices, far off as heaven. The
president sits on Olympian heights, twenty stories up
in Broadway or Wall Street, New York; while the
section hands or miners in Colorado wonder vaguely
how the "old man" looks. We may regret the good
times long ago when employers and employees were
comrades; but weeping will not save the ancient sys-
tem. The impersonal corporation, with no body
that can be kicked and no soul to feel pity or re-
morse, has displaced the visible and tangible owner
who was himself a workman. It were as childish
to wish for the moon as to sigh for an organization
which is burled beyond recall.

4. The social necessity of some kind of harmony
and adjustment is apparent. The waste and loss of
social friction are enormous; political stability Is In
peril from class conflicts; there is a recrudescence of
savagery in "sabotage" ; victory of either side after a
strike is purchased at awful cost no matter who wins
or loses; men are degraded by the hatred engen-
dered; civilization is Impeded; health Is ruined and
offspring are born feeble. It Is this civil war which
has induced men of high character to seek at least


Citizens in Industry

palliatives of misery in acts of kindness and con-

5. There are many signs of a conscious recog-
nition of the need of harmony between employer and
employees, and on both sides. The party in power
must of course make the advances; the party at
present in power is the capitalist manager.^ The
capitalist managers, including the great financiers,
have a position of advantage and power above that
of ancient kings. A small group of bankers con-
trols the destinies of millions; not absolutely, but in
great measure. They are quite willing the world
should believe that they are the great men of the
age. Their contempt for men of rank in other

1 A representative of good-natured employers has thus
expressed this growing recognition of a new era: "Consider
for a moment that almost anything on four wheels was
selling from ten to fifteen years ago, that the entire country
had suddenly waked up to the fact that pleasure makes for
efficiency; that in the old days men responded to pain but
now to pleasure ; formerly to fear, now to hope and ambi-
tion ; formerly that they had to be driven and now that they
have to be enticed. Summing it up, in the old days in gen-
eral they advanced because of fear of hell-fire, and now they

1 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22

Online LibraryCharles Richmond HendersonCitizens in industry → online text (page 1 of 22)