I don't know how many discussions I have had with crapitalusts that revolved around the value theories.
'How do we establish values?'
Well, today your answers will be laid bare by a book that you will not read.
I can't help people that ignore their solutions when they reach out and slap them in face.
I can only keep beating this drum.
I found the processes at the warehouse quite as interesting as Edith had described them, and became even enthusiastic over the truly remarkable illustration which is seen there of the prodigiously multiplied efficiency which perfect organization can give to labor.
It is like a gigantic mill, into the hopper of which goods are being constantly poured by the train-load and shipload, to issue at the other end in packages of pounds and ounces, yards and inches, pints and gallons, corresponding to the infinitely complex personal needs of half a million people.
Dr. Leete, with the assistance of data furnished by me as to the way goods were sold in my day, figured out some astounding results in the way of the economies effected by the modern system.
As we set out homeward, I said:
"After what I have seen to-day, together with what you have told me, and what I learned under Miss Leete's tutelage at the sample store, I have a tolerably clear idea of your system of distribution, and how it enables you to dispense with a circulating medium.
But I should like very much to know something more about your system of production.
You have told me in general how your industrial army is levied and organized, but who directs its efforts?
What supreme authority determines what shall be done in every department, so that enough of everything is produced and yet no labor wasted?
It seems to me that this must be a wonderfully complex and difficult function, requiring very unusual endowments."
"Does it indeed seem so to you?" responded Dr. Leete.
"I assure you that it is nothing of the kind, but on the other hand so simple, and depending on principles so obvious and easily applied, that the functionaries at Washington to whom it is trusted require to be nothing more than men of fair abilities to discharge it to the entire satisfaction of the nation.
The machine which they direct is indeed a vast one, but so logical in its principles and direct and simple in its workings, that it all but runs itself; and nobody but a fool could derange it, as I think you will agree after a few words of explanation.
Since you already have a pretty good idea of the working of the distributive system, let us begin at that end.
Even in your day statisticians were able to tell you the number of yards of cotton, velvet, woolen, the number of barrels of flour, potatoes, butter, number of pairs of shoes, hats, and umbrellas annually consumed by the nation.
Owing to the fact that production was in private hands, and that there was no way of getting statistics of actual distribution, these figures were not exact, but they were nearly so.
Now that every pin which is given out from a national warehouse is recorded, of course the figures of consumption for any week, month, or year, in the possession of the department of distribution at the end of that period, are precise.
On these figures, allowing for tendencies to increase or decrease and for any special causes likely to affect demand, the estimates, say for a year ahead, are based.
These estimates, with a proper margin for security, having been accepted by the general administration, the responsibility of the distributive department ceases until the goods are delivered to it.
I speak of the estimates being furnished for an entire year ahead, but in reality they cover that much time only in case of the great staples for which the demand can be calculated on as steady.
In the great majority of smaller industries for the product of which popular taste fluctuates, and novelty is frequently required, production is kept barely ahead of consumption, the distributive department furnishing frequent estimates based on the weekly state of demand.
"Now the entire field of productive and constructive industry is divided into ten great departments, each representing a group of allied industries, each particular industry being in turn represented by a subordinate bureau, which has a complete record of the plant and force under its control, of the present product, and means of increasing it.
The estimates of the distributive department, after adoption by the administration, are sent as mandates to the ten great departments, which allot them to the subordinate bureaus representing the particular industries, and these set the men at work.
Each bureau is responsible for the task given it, and this responsibility is enforced by departmental oversight and that of the administration; nor does the distributive department accept the product without its own inspection; while even if in the hands of the consumer an article turns out unfit, the system enables the fault to be traced back to the original workman.
The production of the commodities for actual public consumption does not, of course, require by any means all the national force of workers.
After the necessary contingents have been detailed for the various industries, the amount of labor left for other employment is expended in creating fixed capital, such as buildings, machinery, engineering works, and so forth."
"One point occurs to me," I said, "on which I should think there might be dissatisfaction.
Where there is no opportunity for private enterprise, how is there any assurance that the claims of small minorities of the people to have articles produced, for which there is no wide demand, will be respected?
An official decree at any moment may deprive them of the means of gratifying some special taste, merely because the majority does not share it."
"That would be tyranny indeed," replied Dr. Leete, "and you may be very sure that it does not happen with us, to whom liberty is as dear as equality or fraternity.
As you come to know our system better, you will see that our officials are in fact, and not merely in name, the agents and servants of the people.
The administration has no power to stop the production of any commodity for which there continues to be a demand.
Suppose the demand for any article declines to such a point that its production becomes very costly.
The price has to be raised in proportion, of course, but as long as the consumer cares to pay it, the production goes on.
Again, suppose an article not before produced is demanded.
If the administration doubts the reality of the demand, a popular petition guaranteeing a certain basis of consumption compels it to produce the desired article.
A government, or a majority, which should undertake to tell the people, or a minority, what they were to eat, drink, or wear, as I believe governments in America did in your day, would be regarded as a curious anachronism indeed.
Possibly you had reasons for tolerating these infringements of personal independence, but we should not think them endurable.
I am glad you raised this point, for it has given me a chance to show you how much more direct and efficient is the control over production exercised by the individual citizen now than it was in your day, when what you called private initiative prevailed, though it should have been called capitalist initiative, for the average private citizen had little enough share in it."
"You speak of raising the price of costly articles," I said.
"How can prices be regulated in a country where there is no competition between buyers or sellers?"
"Just as they were with you," replied Dr. Leete.
"You think that needs explaining," he added, as I looked incredulous, "but the explanation need not be long; the cost of the labor which produced it was recognized as the legitimate basis of the price of an article in your day, and so it is in ours.
In your day, it was the difference in wages that made the difference in the cost of labor; now it is the relative number of hours constituting a day's work in different trades, the maintenance of the worker being equal in all cases.
The cost of a man's work in a trade so difficult that in order to attract volunteers the hours have to be fixed at four a day is twice as great as that in a trade where the men work eight hours.
The result as to the cost of labor, you see, is just the same as if the man working four hours were paid, under your system, twice the wages the others get.
This calculation applied to the labor employed in the various processes of a manufactured article gives its price relatively to other articles.
Besides the cost of production and transportation, the factor of scarcity affects the prices of some commodities.
As regards the great staples of life, of which an abundance can always be secured, scarcity is eliminated as a factor.
There is always a large surplus kept on hand from which any fluctuations of demand or supply can be corrected, even in most cases of bad crops.
The prices of the staples grow less year by year, but rarely, if ever, rise.
There are, however, certain classes of articles permanently, and others temporarily, unequal to the demand, as, for example, fresh fish or dairy products in the latter category, and the products of high skill and rare materials in the other.
All that can be done here is to equalize the inconvenience of the scarcity.
This is done by temporarily raising the price if the scarcity be temporary, or fixing it high if it be permanent.
High prices in your day meant restriction of the articles affected to the rich, but nowadays, when the means of all are the same, the effect is only that those to whom the articles seem most desirable are the ones who purchase them.
Of course the nation, as any other caterer for the public needs must be, is frequently left with small lots of goods on its hands by changes in taste, unseasonable weather and various other causes.
These it has to dispose of at a sacrifice just as merchants often did in your day, charging up the loss to the expenses of the business.
Owing, however, to the vast body of consumers to which such lots can be simultaneously offered, there is rarely any difficulty in getting rid of them at trifling loss.
I have given you now some general notion of our system of production; as well as distribution.
Do you find it as complex as you expected?"
I admitted that nothing could be much simpler.
"I am sure," said Dr. Leete, "that it is within the truth to say that the head of one of the myriad private businesses of your day, who had to maintain sleepless vigilance against the fluctuations of the market, the machinations of his rivals, and the failure of his debtors, had a far more trying task than the group of men at
Washington who nowadays direct the industries of the entire nation.
All this merely shows, my dear fellow, how much easier it is to do things the right way than the wrong.
It is easier for a general up in a balloon, with perfect survey of the field, to manoeuvre a million men to victory than for a sergeant to manage a platoon in a thicket."
"The general of this army, including the flower of the manhood of the nation, must be the foremost man in the country, really greater even than the President of the United States," I said.
"He is the President of the United States," replied Dr. Leete, "or rather the most important function of the presidency is the headship of the industrial army."
"How is he chosen?" I asked.
"I explained to you before," replied Dr. Leete, "when I was describing the force of the motive of emulation among all grades of the industrial army, that the line of promotion for the meritorious lies through three grades to the officer's grade, and thence up through the lieutenancies to the captaincy or foremanship, and superintendency or colonel's rank.
Next, with an intervening grade in some of the larger trades, comes the general of the guild, under whose immediate control all the operations of the trade are conducted.
This officer is at the head of the national bureau representing his trade, and is responsible for its work to the administration.
The general of his guild holds a splendid position, and one which amply satisfies the ambition of most men, but above his rank, which may be compared—to follow the military analogies familiar to you—to that of a general of division or major-general, is that of the chiefs of the ten great departments, or groups of allied trades.
The chiefs of these ten grand divisions of the industrial army may be compared to your commanders of army corps, or lieutenant-generals, each having from a dozen to a score of generals of separate guilds reporting to him.
Above these ten great officers, who form his council, is the general-in-chief, who is the President of the United States.
"The general-in-chief of the industrial army must have passed through all the grades below him, from the common laborers up.
Let us see how he rises.
As I have told you, it is simply by the excellence of his record as a worker that one rises through the grades of the privates and becomes a candidate for a lieutenancy.
Through the lieutenancies he rises to the colonelcy, or superintendent's position, by appointment from above, strictly limited to the candidates of the best records.
The general of the guild appoints to the ranks under him, but he himself is not appointed, but chosen by suffrage."
"By suffrage!" I exclaimed.
"Is not that ruinous to the discipline of the guild, by tempting the candidates to intrigue for the support of the workers under them?"
"So it would be, no doubt," replied Dr. Leete, "if the workers had any suffrage to exercise, or anything to say about the choice.
But they have nothing.
Just here comes in a peculiarity of our system.
The general of the guild is chosen from among the superintendents by vote of the honorary members of the guild, that is, of those who have served their time in the guild and received their discharge.
As you know, at the age of forty-five we are mustered out of the army of industry, and have the residue of life for the pursuit of our own improvement or recreation.
Of course, however, the associations of our active lifetime retain a powerful hold on us.
The companionships we formed then remain our companionships till the end of life.
We always continue honorary members of our former guilds, and retain the keenest and most jealous interest in their welfare and repute in the hands of the following generation.
In the clubs maintained by the honorary members of the several guilds, in which we meet socially, there are no topics of conversation so common as those which relate to these matters, and the young aspirants for guild leadership who can pass the criticism of us old fellows are likely to be pretty well equipped.
Recognizing this fact, the nation entrusts to the honorary members of each guild the election of its general, and I venture to claim that no previous form of society could have developed a body of electors so ideally adapted to their office, as regards absolute impartiality, knowledge of the special qualifications and record of candidates, solicitude for the best result, and complete absence of self-interest.
"Each of the ten lieutenant-generals or heads of departments is himself elected from among the generals of the guilds grouped as a department, by vote of the honorary members of the guilds thus grouped.
Of course there is a tendency on the part of each guild to vote for its own general, but no guild of any group has nearly enough votes to elect a man not supported by most of the others.
I assure you that these elections are exceedingly lively."
"The President, I suppose, is selected from among the ten heads of the great departments," I suggested.
"Precisely, but the heads of departments are not eligible to the presidency till they have been a certain number of years out of office.
It is rarely that a man passes through all the grades to the headship of a department much before he is forty, and at the end of a five years' term he is usually forty-five.
If more, he still serves through his term, and if less, he is nevertheless discharged from the industrial army at its termination.
It would not do for him to return to the ranks.
The interval before he is a candidate for the presidency is intended to give time for him to recognize fully that he has returned into the general mass of the nation, and is identified with it rather than with the industrial army.
Moreover, it is expected that he will employ this period in studying the general condition of the army, instead of that of the special group of guilds of which he was the head.
From among the former heads of departments who may be eligible at the time, the President is elected by vote of all the men of the nation who are not connected with the industrial army."
"The army is not allowed to vote for President?"
That would be perilous to its discipline, which it is the business of the President to maintain as the representative of the nation at large.
His right hand for this purpose is the inspectorate, a highly important department of our system; to the inspectorate come all complaints or information as to defects in goods, insolence or inefficiency of officials, or dereliction of any sort in the public service.
The inspectorate, however, does not wait for complaints.
Not only is it on the alert to catch and sift every rumor of a fault in the service, but it is its business, by systematic and constant oversight and inspection of every branch of the army, to find out what is going wrong before anybody else does.
The President is usually not far from fifty when elected, and serves five years, forming an honorable exception to the rule of retirement at forty-five.
At the end of his term of office, a national Congress is called to receive his report and approve or condemn it.
If it is approved, Congress usually elects him to represent the nation for five years more in the international council.
Congress, I should also say, passes on the reports of the outgoing heads of departments, and a disapproval renders any one of them ineligible for President.
But it is rare, indeed, that the nation has occasion for other sentiments than those of gratitude toward its high officers.
As to their ability, to have risen from the ranks, by tests so various and severe, to their positions, is proof in itself of extraordinary qualities, while as to faithfulness, our social system leaves them absolutely without any other motive than that of winning the esteem of their fellow citizens.
Corruption is impossible in a society where there is neither poverty to be bribed nor wealth to bribe, while as to demagoguery or intrigue for office, the conditions of promotion render them out of the question."
"One point I do not quite understand," I said.
"Are the members of the liberal professions eligible to the presidency? and if so, how are they ranked with those who pursue the industries proper?"
"They have no ranking with them," replied Dr. Leete.
"The members of the technical professions, such as engineers and architects, have a ranking with the constructive guilds; but the members of the liberal professions, the doctors and teachers, as well as the artists and men of letters who obtain remissions of industrial service, do not belong to the industrial army.
On this ground they vote for the President, but are not eligible to his office.
One of its main duties being the control and discipline of the industrial army, it is essential that the President should have passed through all its grades to understand his business."
"That is reasonable," I said; "but if the doctors and teachers do not know enough of industry to be President, neither, I should think, can the President know enough of medicine and education to control those departments."
"No more does he," was the reply.
"Except in the general way that he is responsible for the enforcement of the laws as to all classes, the President has nothing to do with the faculties of medicine and education, which are controlled by boards of regents of their own, in which the President is ex-officio chairman, and has the casting vote.
These regents, who, of course, are responsible to Congress, are chosen by the honorary members of the guilds of education and medicine, the retired teachers and doctors of the country."
"Do you know," I said, "the method of electing officials by votes of the retired members of the guilds is nothing more than the application on a national scale of the plan of government by alumni, which we used to a slight extent occasionally in the management of our higher educational institutions."
"Did you, indeed?" exclaimed Dr. Leete, with animation.
"That is quite new to me, and I fancy will be to most of us, and of much interest as well.
There has been great discussion as to the germ of the idea, and we fancied that there was for once something new under the sun.
In your higher educational institutions! that is interesting indeed.
You must tell me more of that."
"Truly, there is very little more to tell than I have told already," I replied.
"If we had the germ of your idea, it was but as a germ."