SOCIALISM

throughout the world the war of 1914-18 and its aftermath have profoundly altered the position of socialism in national and international affairs; and its doc- trines and policies, already in rapid change before the war, have been correspondingly modified in the light of post-war condi- tions. above all, the bolshevik revolution of 1917 has deeply affected every socialist movement and party, and has caused in many countries a re-grouping of socialist forces of which the full effects are still impossible to predict. in the years immediately before the war, the outstanding changes in socialist policy were due mainly to two causes—the growth of socialism as a parliamentary force, and the rise of new ideas of industrial organisation and action. not only in great britain, but also in germany, france, italy and other countries, the socialist movement, either directly or through a labour party, had become a powerful force in national politics, and had accordingly begun to shape its policy to suit parliamen- tary requirements. this had led on the one hand to the rise of “revisionist ” doctrines, modifying the militant marxism of earlier days, and on the other to revolts and criticisms from the left wing, directed against the compromising tactics of the official socialist parties. thus in great britain the labour party which had first become an important party after the election of 1906, was accused of allying itself with liberalism and so betray- ing the socialist cause. there were similar divisions of opinion in every developed european country. industrial unionism and syrdicalism.—of more importance, however, in the years before the war, was the growth of new industrial movements and theories. during the first decade of the 2oth century, prices had risen, without an equivalent rise in wages. this led to a wave of reaction against parliamentary methods, which, it was urged, could not really protect the work- ers’ standard of life. indusirial unrest became widespread. ‘the theorics of industrial unionism and syndicalism exerted a wide influence on working-class opinion. ‘the former, arising in america, largely among the immigrant workers, proposed a mass organisation of the whole working class, without distinction of craft, sex or grade, for the revolutionary overthrow of capitalism by direct industrial action, with or without parliamentary action as an auxiliary. the latter, arising in france, largely under anarchist-communist influence, was a definite attempt to re- place parliamentary by industrial methods, and to bring about revolution by mass trade union action leading to working class control of industry and the reconstruction of society on the basis of purely working class institutions. in great britain, a small socialism syndicalist movement grew up during the period of great strike activity between torr and 1914; but far more important was the widespread influence of the new ideas on the trade union movement. guild socialism, which developed rapidly from 1912 onwards, was an expression of this same tendency, stated in terms better adjusted to british conditions, and aiming at a reconciliation of socialism and syndicalism by combining the socialist plan of public ownership of the means of production with the syndicalist plan of workers’ control in industry and society. socialist parties split by the war—the outbreak of the war altered the entire situation. it checked the movement of indus- trial unrest, and acutely divided the socialist forces. in every belligerent country some socialists supported and some opposed the participation of their countries in the. war; in germany, france and great britain and in most of the smaller states the - majority of the socialist supported the war; but in each case a powerful and growing minority opposed it. in great britain the labour party supported the war, and after a time entered into coalition governments for its prosecution; but the independent labour party, largest and most influential of the socialist bodies, took the opposite view, though it remained throughout an affil- iated section of the labour party. in germany the social dem- ocratic party broke eventually into two sections—the majority, which backed the government, and the independent socialists, who refused their support. these cleavages became more pro- nounced as the war continued, and the growing losses and hard- ships steadily swelled the volume of anti-war opinion in all countries, and especially in germany. in 1917, under the strain of war, the old regime in russia hope- lessly broke down. a political revolution placed first a body of liberal reformers and then the moderate labour groups under kerensky in nominal power. but the attempt, in face of com- plete national exhaustion, to carry on the war brought on a fur- ther revolution, by which power passed to the bolsheviks, the left wing socialist party which later adopted the name of com- munist party. the bolsheviks established a “proletarian dic- tatorship,” made peace with germany at brest-litovsk, and set out to work among the war-weary peoples of the belligerent countries for a world-wide socialist revolution. bolshevism.—the bolshevik revolution, by which for the first time a socialist govt. assumed complete political and economic power in a great country, everywhere profoundly affected socialist thought and policy. at first its influence was mainly in the direction of “ pacifism,’’ and it certainly helped to under- mine the war morale of the german people. but when, in the autumn of r9r8, the resistance of germany at length gave way, the revolution which followed did not result in the triumph of socialism. for a while the socialists appeared to be the leading power in the new german republic; but, subjected to the vic- torious allies and fearing starvation by blockade, the german socialists, still disunited, did not attempt to force their power home, and gradually, after a series of disturbances, germany assumed the shape of a constitutional republic in which industry and property remained on a capitalist basis. ture post-war reconstruction of socialist parties meanwhile, the conclusion of the war had led in other coun- tries to a great increase in the strength of the socialist move- ment. every government had made lavish promises of recon- struction after the war, and great hopes had been aroused. a great mass of recruits from all classes flocked into the labour and socialist parties. everywhere there were great industrial as well as political movements. in great britain, the labour party reconstructed itself in r9r9 as the party of the “ workers by hand and brain,” and the trade unions showed, in 1919, great activity in presenting and pressing their demands for improved conditions. idealism was in the air; plans of drastic social and economic reconstruction got widespread attention; and govern- ments went some distance towards compromise with the new forces whose development they feared. constitutional labour- ism gained the most converts; but communism, spreading from socialism russia, mace its appearance in every country as an organised revolutionary movement, preaching the class war and denounc- ing moderate socialism as a middle-class doctrine designed to mislead the workers and divert them from the task of revolu- tionary action. for two years after the war, trade prospered and wealth appeared to abound. but then came everywhere a pronounced industrial slump, causing widespread unemployment and a severe fall in both wages and profits. plans of social reconstruction were hastily jettisoned; great strikes or lock-outs, such as the british miners’ lock-out in 1921, broke the power of the trade unions; a wave of reaction swept across the world. the euro- pean governments attempted to break the power of communism by the ostracism and blockade of russia, which had offended against capitalist standards by wholesale confiscation of prop- erty and repudiation of debts, as well as by propaganda in other countries; and, while the socialists everywhere opposed these measures, the deep cleavages between communists and ortho- dox socialists in the european countries helped to undermine their influence, and added to the fundamental weakness caused by the decline in the demand for labour. from the end of 1920 to the end of 1925, to which this article extends, the slump remained in being, especially in great bri- tain, and everywhere trade union membership declined and there was a fall in the working-class standard of life. this, however, did not necessarily involve a decline in the voting strength of the socialists in parliamentary elections. thus the british labour party which in roro (dec.) secured 370,802 votes and 42 seats in the house of commons, and in 1918 (on the new franchise) 2,244,945 votes and 57 seats, got 4,348,375 votes and i9t seats in 1923, and, despite adverse electional conditions, 5,551,549 votes and 151 seats in 1924. moreover, after the 1923 election a labour govt. for the first time in british history assumed office, albeit as a minority administration dependent on liberal support. under these conditions, however, it was unable, like the socialist governments which have hek] office in sweden, denmark and other countries, to take any important step towards a distinctively socialist policy. ‘british parties —the cleavage between orthodox socialism and communism has, for certain definite reasons, been far less pronounced in great britain than in most of the continental countries. the british labour party is based directly on the trade unions, which control the overwhelming majority of votes at its conferences. the affiliated socialist societies, among which the only body of real importance is the independent labour party, with about 50,000 members, are only a tiny fraction of it, and owe their position to energy and readiness to accommo- date themselves to circumstances rather than to numbers. the trade unions are not greatly interested in the theoretical dis- putes of communists and social democrats, and realise the importance of preserving unity for their own practical work. whereas, therefore, continental socialist movements have been riven in twain according to the conilicting theories of their indi- vidual supporters it has been very hard for communism to strike root in great britain. the communist party, which has sought but been refused affiliation to the labour party, has only a few thousand members; and though these conduct, through a so-called “‘ minority movement,” active propaganda inside the trade unions, they produce relatively little effect. in france, on the other hand, the majority of the pre-war sccialist party went over to communism, leaving the minority to re-form the socialist party as a separate body, while in germany, though the social democratic party remains the largest party in the country, the communists have a really powerful and substantial following. tut international movement the rival tendencies in post-war socialism find expression in two rival internationals—the labour and socialist international, dominated by the continental right wing parties and the british labour party, and the third, er communist, international, the organisation of which centres upon the russian communist 571 party. similarly, there are two trade union internationals— the amsterdam international federation of trade unions, to which the british and the majority of the unions in most of the continental countries belong, and the red international of labour unions, which includes the russians and the “ minority movements ” of anumber of other countries. the italian move- ment, almost crushed out by fascism, and the american, still pursuing a policy of national isolation, stand outside both camps. there have been repeated attempts to promote working-class unity in both the political and the economic sphere; but the con- flicts of politics and personalities have so far outweighed the tendencies making for common action, of which the chief is the growing pressure in all capitalist countries, under stress of bad trade and international competition, to lengthen again the work- ing day reduced after the war, and to press down the working- class standard of life. socialism and politics —socialism everywhere came into effec- tive activity as a movement of working-class revolt, at a time when the impracticabilily of securing results by parliamentary action and the frequent repression of socialist propaganda left socialists no alternative to the adoption of a revolutionary atti- tude. but gradually these early socialist bodies won their way to toleration and, commanding a wider influence, took shape as political parties returning a substantial body of members to the various national parliaments. this change led to a marked development of evolutionary socialist doctrines, in which the achievement of socialism was envisaged, not catastrophically, but as a gradual transformation of the social order by legislative reforms and as the result of a progressive socialist conquest of political power. always there were socialist groups which repu- diated this view (the syndicalists in france, tke socialist labour party in america, the bolsheviks in russia, the industrial unionists in great britain); but up to 1914 it appeared to be definitely the growing conception of socialist policy. it resulted in a placing of the main stress on parliamentary action and on the nationalisation of industry as the means to socialisation of the economic system. as we have seen, the earlier revolts against this doctrine were mainly industrial movements, designed to turn trade unionism in- to arevolutionary instrument for the conquest of power and the achievement of workers’ control in industry. but after the rus- sian revolution the left wing in the various working-class move- ments tended to re-cast its policy, and to think in terms, not of a general strike (syndicalism) or a trade-union advance towards the control of industry (guild socialism), but of a decisive pro- letarian revolution establishing the dictatorship of a disciplined communist party. the state and parliament, which the mod- erate “ collectivist ’’ socialists had looked upon as the instru- ments of social transformation, were denounced as_ purely capitalist institutions, to be forcibly overthrown and replaced by an exclusively proletarian state as in russia. this doctrine, clearly enunciated in marx’s communist manifesto of 1848, has been most decisively developed by lenin, the leader of the rus- sian bolsheviks (see his he state and revolution and other writings). this tendency to look to revolution, rather than to evolutionary development, as the means of establishing social- ism, has been greatly fostered by the world-wide unloosing of force during the world war, by the apparent success of the method in russia as compared with the doubtful fortunes of moderate socialism in germany and elsewhere, by its employ- ment on the capitalist side in italyand spain, and on both sides in ireland, suggesting that parliamentary decisions will not be obeyed when they cut beyond a certain depth; and by the un- settled condition and uncertain economic prospects of the post- war world. for, whereas before the war it seemed as if the condition of the workers was gradually improving with the gen- eral increase in the world’s wealth, nowadays the whole eco- nomic system is in serious difficulties and the standards of labourappear to be seriously threatened in nearly every country, with only the outstanding exception of the united states. yet it would be a profound mistake to regard post-war socialism as a movement sharply divided into two opposing 572 factions—revolutionary communists and parliamentary collec- tivists upholding a pacific and constitutional policy. this 1s indeed the outward form which the struggle often seems to assume. but in every country there are very large groups, far less dis- tinctly organised, which stand at points between the two ex- tremes. far more important than communism itself, except in russia, is the iniluence on general socialist thought and policy which not only communism but also such doctrines as guild socialism have undoubtedly exercised. the ordinary trade-union or socialist party member nowadays, even if he is no communist, is far less inclined than he was to make constitutionalism a matter of principle, and far more inclined to resort to direct action on a broad basis for the achievement of socialist, as well as purely immediate economic, ends. this is the result in part of com- munism and the russian revolution, but still more of war expe- rience and changed economic conditions, especially the lessened belief in the stability of the capitalist system and the sincerity of its parliamentary constitutionalism. changes in tie socialist programmes again it may be said that, largely owing to guild socialist and syndicalist influence, the practical socialist programme has undergone great changes. all schools of socialists still stand for the transference of large scale industry from private to public ownership; but mere state socialism, or nationalisation, is no longer a satisfying conception to socialists of any school. in greater or less degree, all now stand for some form of “ workers’ control’ in socialised industry, and repudiate the idea that industry can be bureaucratically run on any existing civil service model. for example, the british miners, who before the war mercly demanded state ownership, now demand as well a sub- stantial share in the control of theirindustry under public owner- ship. the french have their plan of “ industrial nationalisa- tion,” and workers’ control appeared prominently in german schemes of socialisation after the war. political co-operation with non-sectalist parties —1t remains to be seen how these changes in doctrine will, in the long run, work out in socialist political practice. for, while the tendency of socialist thought and working-class opinion has been on the whole distinctly leftward ever since 1911, there are powerful forces pulling socialist practice the other way. especially as, in one country after another, the socialist partics by consti- tutional means reach the threshold of political power and increase their parliamentary following, there are strong inducements to disarm opposition and facilitate the assumption of office by the adoption of pacific courses and by compromise or coalition with other parties. in france for example, the socialists have for some years been in alliance with the radical parties in a cartel des gauches, while in germany they have taken part in coalition governments with the middle-class parties, and in great britain a labour govt. held office for nearly a year with libcral support. these groupings have arisen in all cases out of difficult political situations; and the tendency may well be for such situations to arise even more often in the future. but there is no doubt that the socialist parties, if under these impulsions they moved far to the “‘ right” into alliance with the “ liberal” groups, would forfeit a substantial part of their working-class support, which would either go over to communism, or form new political groupings of the “ left”? on a more definitely socialist basis and programme. solidifying force of trade untonism.—socialism, then, in 1925, is far nearer than it was in 1911 to the tests of practical experience and responsibility. naturally, under these condi- tions, difficulties are more clearly seen, and differences previously latent become more pronounced. but, especially in great britain, trade unionism, which is doomed to impotence unless it can transcend these differences and maintain working-class unity, acts as a great solidifying force, and prevents the pushing of quarrels to the point of a split in the political field. and it may be that, elsewhere as well, this need for unity in pursuit of common economic ends will, in the long run, re-unite the warring factions of european socialism, and achieve a new basis of | socialism: principles and outlook political agreement. it would take a bold man to prophesy what the outcome will be. but the tendencies at least are clear enough, and are manifested in every country in which the movement exists at all. and the underlving basis is also clear; for, despite all its transformations and developments, socialism remains essentially not so much a theoretical plan of social reorganisation as a class movement arising directly out of the economic divisions in society determined by the rise of capitalism and the industrial revolution. it is an attempt to formulate for the proletariat a policy designed to promote a more equal distribution and also a larger production of wealth, and to abolish class distinctions based on inequalities of wealth and social opportunity, or on property laws and relations which encourage the accumulation of the means of production in private hands. its forms and its actual policies may change with the movement of events, thoughts and economic forces; but through all its changes it retains this underlying and essential character, proclaimed by marx in the communist manifesto of 1848,'to which formulation the great majority of socialists still trace the impetus of the movement as a creative social force. by no means all socialists, especially in great britain, call them- selves marxists; but to this extent at any rate the movement as a whole is based firmly on marx’s diagnosis of the social prob- lem (see a/so communism; second international; third inter- national). bibliography.—general. there is no really good account of socialism as a whole. the handiest text-books in english are w. sombart, socialism and the soctal movement, tr. by m. epstein (1909); t. kirkup, jzistory of socialism, 5th ed., revised by e, a, pease (1913); the best post-war books, s. and b. webb, a con- stitution for the socialist commonwealth of great britain (1920); q: ramsay macdonald, socialism, critical and constructive (1921); hl. n. brailsford, socialism for to-day (1925). r. c. kk. ensor’s modern socialism (1910) is a useful pre-war collection of extracts from the writings of socialists of all countries. max beer's iistory of british socialism, 2 vol. (1919-20) is indispensable. for the growth of the movement in foreign countries, see the labour inter- national itandbook (1921) and supplement (1923). other useful books are h. g. wells, new worlds for old, rev. ed. (1914); bertrand russell, reads to freedom (1918); g. d. h. cole, guild secialism re-stated (1920). see also n. lenin, the state and revolution, eng. tr. (1919); n. [. bucharin and e. preobrazhensky, the a. b. c. of communism, eng. tr. (1922). phe communist manifesto of k. marx and e. engels (1848) should be compared withthe new communist manifesto of the third international (1919) and with the british labour party's labour and the new social order (1918). marxism. i<. marx, capital, eng. tr. (1907-9), etc. max beer, the life and teaching of karl marx (1921); a. d. lindsay, karl marx's capital (1925). there is, of course, a large literature on socialism in nearly every european language.? g. d. h.c.) socialism: principles and outlook, (sce 25.301).— socialism, reduced to its simplest legal and practical expres- sion, means the complete discarding of the institution of private property by transforming it into public property, and the divi- sion of the resultant public income equally and indiscriminately among the entire population. thus it reverses the policy of capitalism, which means establishing private or “ real ’ property to the utmost physically possible extent, and then leaving dis- tribution of income to take care of itself. the change involves a complete moral volte-face. in socialism private property is anathema, and equal distribution of income the first considera- tion. in capitalism private property is cardinal, and distribu- tion left to ensue from the play of free contract and selfish interest on that basis, no matter what anomalies it may present. ie socialism never arises in the earlier phases of capitalism, as, for instance, among the pioneers of civilisation in a country where there is plenty of land available for private appropriation by the last comer. the distribution which results under such circumstances presents no wider departures from a rough equality than those made morally plausible by their association with exceptional energy and ability at the one extreme, and 1 drafted in 1847; published in 1848. 2 for the contrary case capitalism the article should be consulted. socialism: principles and outlook with obvious defects of mind and character or accidental hard luck, at the other. this phasc, however, does not last long under modern conditions. all the more favourable sites are soon ptivately appropriated; and the later comers (provided by immigration or the natural growth of the population), finding no eligible land to appropriate, are obliged to live by hiring it at a rent from its owners, transforming the latter into a rentier class enjoying unearned incomes which increase continually with the growth of the population until the landed class becomes a moncy-lending or capitalist class also, capital being the name given to spare money. the resource of hiring land and spare money is open to those only who are sufliciently educated to keep accounts and manage businesses, most of whom spring from the proprietary class as younger sons. the rest have to live by being hired as labourers and artisans at weekly or daily wages; so that a rough division of society into an upper or pro- prietary class, a middle or employing and managing class, and a wage proletariat is produced. in this division the proprietary class is purely parasitic, consuming without producing. as the inexorable operation of the economic law of rent makes this class richer and richer as the population increases, its demand for domestic servants and for luxuries of all kinds creates parasitic enterprise and employment for the middle class and the pro- letariat, not only withdrawing masses of them from productive: industry, but also fortifying itself politically by a great body of workers and employers who vote with the owners because they are as dependent on the owners’ unearned incomes as the owners themselves. meanwhile the competition of employers for custom, which leads to the production of a dozen articles to satisfy the demand for one, leads to disastrous crises of feverish overproduction alternated with periods of bad trade (‘‘ booms ” and ‘‘ slumps’’), making continuous employment of the proletariat impossible. when wages fall to a point at which saving also is impossible, the unemployed have no means of subsistence except public re- lief during the slumps. it is in this phase of capitalistic development, attained in great britain in the 19th century, that socialism arises as a revolt against a distribution of wealth that has lost all its moral plausibility. colossal wealth is associated with unproductive- ness, and sometimes with conspicuous worthlessness of charac- ter; and lifetimes of excessive toil beginning in early childhood leave the toiler so miserably poor that the only refuge left for old age is a general workhouse, purposely made repulsive to deter proletarians from resorting to it as long as they have strength enough left for the most poorly paid job in the labour market. the inequalities become monstrous: hardworking men get four or five shillings a day (post-war rates) in full view of persons who get several thousands a day without any obligation to work at all, and even consider industrial work degrading. such variations in income defy all attempts to relate them to varia- tions in personal merit. governments are forced to intervene and readjust distribution to some extent by confiscating larger and larger percentages of incomes derived from property (income tax, supertax, and estate duties) and applying the proceeds to unemployment insurance and extensions of communal services, besides protecting the proletariat against the worst extremitics of oppression by an elaborate factory code which takes the control of workshops and factories largely out of the hands of their proprietors, and makes it impossible for them to exact grossly excessive hours of labour from their employees or to neglect their health, physical safety, and moral welfare with complete selfishness. this confiscation of private property incomes for public purposes without any pretence of compensation, which is now proceeding on a scale inconceivable by victorian ministers, has destroyed the integrity of private property and inheritance; and the success with which the confiscated capital has been ap- plied to communal industries by the municipalities and the central government, contrasted with the many failures and comparative costliness of capitalist industrial adventure, has shaken superstition that private commercial management is t { 573 always more effective and less corrupt than public management. in particular, the british attempt to depend on private industry for munitions during the war of 1914-8 nearly led to defeat; and the substitution of national factories was so sensationally successful, and the post-war resumption of private enterprise, after a brief burst of illusory prosperity, was followed by so distressing a slump, that the reversal of the relative efficiency prestige of socialism and capitalism was vigorously accelerated, leaving capitalism unpopular and on the defensive, whilst con- fiscation of private capital, communal enterprise, and national- isalion of the big industries, grew steadily in popularity in and out of parliament. this change in public opinion had already deeply penetrated the middle class, because of the change for the worse in the position of the ordinary employer. he, in the roth century, was admittedly master of the industrial, and, after the reform of 1832, of the political situation. ife dealt directly and even domineeringly with the proprietary class, from which he hired his land and capital either directly or through agents who were his servants and not his masters. but the sums required to set on foot and develop modern industrial schemes grew until they were out of reach of ordinary employers. the collection of money to be used as capital became a special business, conducted by professional promoters and financiers. these experts, though they had no direct contact with industry, became so indispensable to it that they are now virtually the masters of the ordinary routine employers. meanwhile the growth of joint-stock enter- prise was substituting the employee-manager for the employer, and thus converting the old independent middle class into a proletariat, and pressing it politically to the left. with every increase in the magnitude of the capital sums required for starting or extending large industrial concerns comes the need for an increase in the ability demanded by their management; and this the financiers cannot supply: indeed they bleed industry of middle class ability by attracting it into their own profession. matters reach a point at which industrial management by the old-fashioned tradesman must be replaced by a professionally trained and educated bureau- cracy; and as capitalism docs not provide such a bureaucracy, the industries tend to get into difficulties as they grow by com- bination (amalgamation), and thus outgrow the capacity of the managers who were able to handle them as separate units. this difficulty is increased by the hereditary element in business. anemployer may bequeath the control of an industry involving the subsistence of thousands of workers, and requiring from its chief cither great natural ability and energy or considerable scientific and political culture, to his eldest son without being challenged to prove his son’s qualifications, whilst if he proposes to make his second son a doctor or a naval officer he is peremp- torily informed by the government that only by undergoing an elaborate and prolonged training, and obtaining official certifi- cates of qualification, can his son be permitted to assume such responsibilities. under these circumstances, much of the manage- ment and control of industry gets divided between routine em- ployers who do not really understand their own businesses, and financiers, who, having never entered a factory nor de- scended a mine shaft, do not understand any business except the business of collecting money to be used as capital, and forcing it into industrial adventures at all hazards, the result being too often reckless and senseless over-capitalisation, leading to bankrupicics (disguised as reconstructions) which reveal the most astonishing technical ignorance and economic blindness on the part of men in high repute as directors of hyge industrial combinations, who draw large feces as the remuneration of a mys- tical ability which exists only in the imagination of the share- holders. if. all this steadily saps the moral plausibility of capitalism. the loss of popular faith in it has gone much further than the gain of any widespread or intelligent faith in socialism. consequently the end of the first quarter of the 2oth century finds the political 574 situation in europe confused and threatening: all the political parties diagnosing dangerous social disease, and most of them proposing disastrous remedies. national governments, no matter what ancient party slogans they raise, find themselves controlled by financiers who follow the slot of gigantic inter- national usuries without any public aims, and without any technical qualifications except their familiarity with a rule-of- thumb city routine quite inapplicable to public affairs, because it deals exclusively with stock exchange and banking categories of capital and credit. these, though valid in the money market when conducting exchanges of future incomes for spare ready money by the small minority of persons who have these luxuries to deal in, would vanish uncler pressure of any general political measure like—to take a perilously popular and plausible example—a levy on capital. such a levy would produce a money market in which there were all sellers and no buyers, sending the bank rate up to infinity, breaking the banks, and bringing industry to a stand- still by the transfer of all the cash available for wages to the national treasury. unfortunately the parliamentary proletarian parties understand this as little as their capitalist opponents. they clamour for taxation of capital; and the capitalists, instead of frankly admitting that capital as they reckon it is a phantom, and that the assumption that a person with an income of £35 a year represents to the state an immediately available asset of £100 ready money, though it may work well enough as between a handful of investors and spendthrifts in a stockbroker’s office, is pure fiction when applied to a whole nation, ignorantly defend their imaginary resources as if they really existed, and thus confirm the proletariat in its delusion instead of educating it. the financiers have their own ignis fatuus, which is that they can double the capital of the country, and thus give an im- mense stimulus to industrial development and production, by inflating the currency until prices rise to a point at which goods formerly marked £50 are marked £100, a measure which does nothing nationally but enable every debtor to cheat his cred- itor, and every insurance company and pension fund to reduce by half the provision for which it has been paid. ‘the history of inflation in europe since the war of 1914-8, and the resultant impoverishment of pensioners and officials with small fixed incomes, forces the middle classes to realise the appalling con- sequences of abandoning finance and industry direction to the un- skilled, politically ignorant, unpatriotic ‘ practical business men.” meanwhile, the nobility of capital leads to struggles for the possession of exploitable foreign territories (‘‘ places in the sun ”’) produces war on a scale which threatens not only civilisation but human existence; for the old field combats between bodies of soldiers, from which women were shielded, are now replaced by attacks from the air on the civil population, in which women and men are slaughtered indiscriminately, making replacement of the killed impossible. the emotional reaction after such wars takes the form of acute disillusion, which further accelerates the moral revolt against capitalism, without unfortunately, pro- ducing any workable conception of an alternative. the pro- letarians are cynically sulky, no longer believing in the disin- terestedness of those who appeal to them to make additional efforts and sacrifices to repair the waste of war. the moral mainspring of the private property system is broken; and it is the confiscations of unearned income, the extensions of municipal and national communism, above all, the new sub- sidies in aid of wages extorted from governments by threats of nationally disastrous lock-outs and strikes, which induce the proletariat to continue operating the capitalist system now that the old compulsion to work by imposing starvation as the alter- native, fundamental in capitalism, has had to be discarded in its primitive ruthlessness. the worker who refuses to work can now quarter himself on public relief (which means finally on confiscated property income) to an extent formerly impossible. democracy, or votes for everybody, does not produce con- structive solutions of social problems; nor docs compulsory schooling help much. unbounded hopes were based on each successive extension of the electoral franchise, culminating in the enfranchisement of women. these hopes have been dis- | socialism: principles and outlook appointed, because the voters, male and female, being politically untrained and uneducated, have (a) no grasp of constructive measures, (4) loathe taxation as such, (c) dislike being governed at all, and (d) dread and resent any extension of ofiicial inter- ference as an encroachment on their personal liberty. compul- sory schooling, far from enlightening them, inculcates the sacred- ness of private property, and stigmatises a distributive state as criminal and disastrous, thereby continually renewing the old public opinion against socialism, and making impossible a na- tional education dogmatically inculcating as first principles the iniquity of private property the paramount social importance of equality of income and the criminality of idleness. consequently, in spite of disillusion with capitalism, and the growing menace of failing trade and falling currencies, our democratic parliamentary oppositions, faced with the fact that the only real remedy involves increased taxation, compulsory reorganisation or frank nationalisation of the bankrupt indus- tries, and compulsoty national service in civil as in military life for all classes, dare not confront their constituents with such proposals, knowing that on increased taxation alone they would lose their seats. to escape responsibility, they look to the sup- pression of parliamentary institutions by coups d'etat and dictatorships, as in italy, spain and russia. this despair of par- liamentary institutions is a striking novelty in the present cen- tury; but it has failed to awaken the democratic electorates to the fact that, having after a long struggle gained the power to govern, they have neither the knowledge nor the will to exercise it, and are in fact using their votes to keep government parochial when civilisation is bursting the dikes of nationality in all directions. a more effective resistance to property arises from the organ- isation of the proletariat in trade unions to resist the effect of increase of population in cheapening labour and increasing its duration and severity. but trade unionism js itself a phase of capitalism, inasmuch as it applies to labour as a commodity that principle of selling in the dearest market, and giving as little as possible for the price, which was formerly applied only to land, capital and merchandise. its method is that of a civil war between labour and capital in which the decisive battles are lock-outs and strikes, with intervals of minor adjustment by industrial diplomacy. trade unionism now maintains a labour party in the british parliament. the most popular members and leaders are socialists in theory; so that there is always a paper programme of nationalisation of industries and of banking, taxation of unearned incomes to extinction, and other inciden- tals of a transition to socialism; but the trade union driving force aims at nothing more than capitalism with labour taking the lion’s share, and energetically repudiates compulsory national service, which would deprive it of ils power to strike. in this it is heartily seconded by the proprietary parties, which, though willing enough to make strikes illegal and proletarian labour compulsory, will not pay the price of surrendering its own power to idle. compulsory national service being essential in socialism, it is thus deadlocked equally by organised labour and by capitalism. itis a historic fact, recurrent enough to be called an economic law, that capitalism, which builds up great civilisations, also wrecks them if persisted in beyond a certain point. it is easy to demonstrate on paper that civilisation can be saved and immensely developed by, at the right moment, discarding capitalism and changing the private property profiteering state into the com- mon property distributive state. but though the moment for the change has come again and again it has never been effected, because capitalism has never produced the necessary enlighten- ment among the masses, nor admitted to a controlling share in public affairs the order of intellect and character outside which socialism, or indeed politics, as distinguished from mere party electioneering, is incomprehensible. not until the two main tenets of socialism: abolition of private property (which must not be confused with personal property), and equality of income, have taken hold of the people as religious dogmas, as to which no controversy is regarded as sane, will a stable socialist state social service be possible. it should be observed, however, that of the two tenets, the need for equality of income is not the more difiicult to demonstrate, because no other method of distribution is or ever has been possible. omitting the few conspicuous instances in which actual earners of money make extraordinary fortunes by exceptional personal gifts or strokes of luck, the existing dif- ferences of income among workers are not individual but corporate differences. within the corporation no discrimination between individuals is possible; all common labourers, like all upper division civil servants, are equally paid. the argument for equalising the class incomes are that unequal distribution of purchasing power upsets the proper order of economic produc- tion, causing luxuries to be produced on an extravagant scale whilst the primitive vital needs of the people are left unsatisfied; that its effect on marriage, by limiting and corrupting sexual selection, is highly dysgenic; that it reduces religion, legisla- tion, education and the administration of justice to absurdity as between rich and poor; and that it creates an idolatry of riches and idleness which inverts all sane social morality. unfortunately, these are essentially public considerations. the private individual, with the odds overwhelmingly against him as a social climber, dreams even in the deepest poverty of some bequest or freak of fortune by which he may become a capitalist, and dreads that the little he has may be snatched from him by that terrible and unintelligible thing, state policy. thus the private person’s vote is the vote of ananias and sapphira; and democracy becomes a more effective bar to socialism than the pliant and bewildered conservatism of the plutocracy. under such conditions the future is unpredictable. empires end in ruins: commonwealths have hitherto been beyond the civic capacity of mankind. but there is always the possibility that mankind will this time weather the cape on which all the old civilisations have been wrecked. it is this possiblity that gives intense interest to the present historic moment, and keeps the socialist movement alive and militant. cg. 5.7)