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   "I don't see no sense in always grumblin'," Crass proceeded,
"these things can't be altered; you can't expect there can be
plenty of work for everyone with all this 'ere labour-savin'
machinery what's been invented."
   "Of course," said Harlow, "the people what used to be
employed on the work what's now done by machinery has to find
something else to do. Some of 'em goes to our trade, for
instance. The result is there's too many at it, and there ain't
enough work to keep 'em all goin'."
   "Yes," cried Crass, eagerly, "that's just what I say. Machinery
is the real cause of all the poverty. That's what I said the
other day."
   "Machinery is undoubtedly the cause of unemployment,"
replied Owen, "but it's not the cause of poverty; that's another
matter altogether."
   The others laughed derisively.
 
      The Ragged Trousered Philanthropists,
                             by ROBERT TRESSALL.

MR. CHESTERTON'S PREFACE

But the general power to return to origins is an even greater matter; and what it needs is intellectual independence. Indeed, there is an unconscious truth in the phrase of shallow people who talk of a man like Mr. Penty as if he were behind the times. In one sense he is behind the times; as we speak of a man being behind the scenes. The man behind the scenes is at the back of things and the beginning of things. He knows where the actors come from, and how the whole performance began. He has seen all the machinery, and can consider the play as a play, and not as a temporary illusion. Mr. Penty has seen the machinery of the modern world and does not think much of it; he has seen the illusion of progress and prosperity which it produced on the crowd, at least to some extent and for a time, and he knows it is an illusion. That is to say, he is what so few modern people can be, he is outside the modern world, and in a sense surrounds it. He can judge it freely, not merely by comparison with a real past, but by comparison with a possible future. And, as a matter of fact, that future is becoming more and more possible. It is the present that is becoming impossible. Those who blame Mr. Penty for looking to the past for an alternative to industrialism, do not realize that industrialism itself shows many signs of soon becoming a thing of the past. What is called industrial unrest might more truly be described as industrial collapse; and the things that are not collapsing are exactly the old things that it was the fashion to regard as decaying, such as the ancient peasantries of Christendom. It is these modernists who are behind the times; it is these materialists who have tied their fortunes to a failure; and it is the modern industrial city that has become a home of lost causes. These people do not understand the meaning of the Bolshevisk concession to the peasantry, of the revival of Italy, of the new power of France, of the successful revolution in Ireland.

What is wanted in this transition is a practical policy for England; and Mr. Penty propounds his practical policy. As he points out, it is really far more practical, in the sense of adaptable to existing conditions, than the alternative schemes of a more elaborate and systematized Guild Socialism, let alone the elaborate and systematized schemes of the Fabians, the Marxians, or the Douglasites. But the special thesis of this book, as distant from the author's other books, is set out much too clearly to need any anticipatory amplification. From the first discovery of the error of Socialism about its own origin, to the final forecast of a real reconstruction analogous to the real reconstructions of the past, the reader can follow the argument in detail, and differ or agree as the case may be; but if he is intelligent he will certainly not dismiss it as a fad or fable about the good old times. I am content here to express something of the gratitude felt by all thinking people to the author, and to leave the book to speak for itself. G. K. CHESTERTON.

AUTHOR'S PREFACE

Nowadays all that is changed. It is generally admitted that the progress on which we prided ourselves before the war was for the most part illusory. Our comfortable optimism could not stand the shock of four years of war. The fact that the mechanical triumphs of our civilization so readily lent themselves to the purposes of destruction has destroyed, once and for ever, that hypnotic belief in the ultimate beneficence of science and machinery that was the faith of our generation, while the anticipated discovery of some method of liberating the stores of sub-atomic energy is looked upon with real apprehension by those who recognize its potentialities for evil, since, unless the moral development of man can keep step with his technical discoveries, it may well prove to be the most disastrous thing that has happened in the history of mankind.

Simultaneously with this alarm in regard to the discoveries of science, the unrestricted use of machinery is being interrogated. Before the war protests against the abuse of machinery were mainly of two kinds: economic and æsthetic. There was the economic objection of those who found their labour displaced by some new invention, and the æsthetic objection of the followers of Ruskin and Morris. But neither of them were taken very seriously. The complaints of those who found their labour displaced were not listened to because such inconveniences were supposed to be inevitable to a time of transition, while the æsthetic objection was treated by most men with something approaching contempt. Nowadays, however, all this is changing. It is becoming apparent to an ever- increasing number of thinking people that there is a definite connection between the economic deadlock that has overtaken society and our mechanical methods of production, since, apart from such methods, it is obvious that the problem on such a gigantic scale could never have come into existence. Educationalists are becoming interested, for they see all their work being undone the moment a boy leaves school for the factory, while the recent publication of Dr. Austin Freeman's Social Decay and Regeneration, of which Dr. Inge, in reviewing it, said that the chapters in which he girds up his loins for an attack on machinery might have been the exhortation which persuaded Samuel Butler's Erewhonians to destroy all their machines, is significant primarily as a book on eugenics. So long as people thought that apart from incidental unemployment, which called for organization, the only objection to machinery was a æsthetic, they might dismiss it as a fad. They might even, in their ignorance, feel a certain superiority in dismissing such an objection. They could even say (as I have heard people say), that excellence in the arts was the mark of a lower state of social evolution. But when they learn from an eminent scientist that the unrestricted use of machinery is not only fatal to the arts, but to man himself, spelling finally race suicide, inasmuch as it is followed everywhere by a decline in physical and mental efficiency, even the British Philistine begins to think. For scientists are the high priests of the modern world, and when they speak they are listened to.

The present volume carries the attack into the realm of economic theory. It had always seemed to me that the problem of machinery was central in the social problem, for I could never see how economic warfare could be brought to an end until machinery was controlled. But what was so plain to me was, unfortunately, not so apparent to others, yet it was not until lately, when I had the good fortune to read Mr. Beer's History of British Socialism, that I could see how this truth could be demonstrated. I could not see how to get behind the popular Socialist notion that no such problem existed, or the position of those who, while admitting that a problem existed, nevertheless maintained it was subordinate to the problem of capitalism, and that to raise it was to raise a false issue. But when I read Mr. Beer's history I made the interesting discovery, not only that the Socialist Movement had its origin in an attempt to solve the problem of men and machines, but that the problem of machinery occupied a central position in Socialist thought from the days of Owen to Marx. This discovery removed what had hitherto been an unsurmountable obstacle, and makes it possible to state the problem in the terms of the thought of to-day.

A word about the title of the book. From one point of view, Post-Industrialism connotes Medievalism, from another it could be defined as "inverted Marxism." But in any case it means the state of society that will follow the break-up of Industrialism, and might therefore be used to cover the speculations of all who recognize Industrialism is doomed. The need of some such term sufficiently inclusive to cover the ideas of those who, while sympathizing with the ideals of Socialists, yet differed with them in their attitude towards Industrialism, has long been felt, and the term Post-Industrialism, which I owe to Dr. A. K. Coomaraswamy, seems to me well suited to supply this want.

It remains to add that this book is complementary to my Guilds, Trade and Agriculture, which analyses the post-war problem from the point of view of exchange. A. J. P. 66, STRAND-ON-GREEN,

December, 1921.

I. THE FORGOTTEN PURPOSE OF THE SOCIALIST MOVEMENT

From a sociological point of view, the period from 1760 to 1825, in which the foundation of modern political and reform activity was laid, exhibits four phases: "The first was purely parliamentary and constitutional; its protagonists, Wilkes and `Junius,' fought against the oligarchy and the remnants of personal monarchy. The second phase was mainly agrarian; the effect of the rapid rate of enclosing farms and commons, as well as of the improvements in agriculture, turned the attention of revolutionaries towards agrarian reform; its writers were Spence, Ogilvie and Paine. The third phase was caused by the enthusiasm for the French Revolution on the part of the English intellectuals and London artisans, whose minds had been prepared by the theories which were current in the antecedent two phases; its writers were William Godwin, the youthful Coleridge, Southey, Wordsworth, and John Thelwall. The fourth phase was that of the industrial revolution proper, the first critical writer of which was Charles Hall, followed by Robert Owen and his school, and the anti-capitalist critics, Ravenstone, Hodgskin, and several anonymous writers: the poet of this phase was Shelley."

Each of these phases contributed something to the stock of ideas and ferment of reform activity that opened in the second decade of the nineteenth century, and which gradually gathered strength until the defeat of the Chartist Movement in 1848. But it was the last phase that gave birth to the Socialist Movement. The introduction of machinery had been accompanied by the growth of prosperity--a prosperity in which the working- class shared, for wages were high and employment was plentiful. But about the year 1806 its unrestricted use resulted in supply outstripping demand, and the displacement and depreciation of labour by machinery began, and reformers began to turn their attention to industrial problems. By 1811 the problem had become acute, and widespread unemployment gave rise to the Luddite riots. The infuriated workmen rose and destroyed the machinery. The riots began in Nottingham with the destruction of stocking and lace frames, and spread into Yorkshire and Lancashire. The situation was met by the enactment of Draconian laws that made the wilful destruction of machinery a crime, punishable by death, and in January, 1813, eighteen workmen died on the gallows at York. Still the problem remained. The number of unemployed increased at an alarming rate, public opinion became agitated, meetings were called and committees appointed to investigate the cause of the distress and find a remedy for it. But no remedy was forthcoming. And this for the simple reason that, in the terms in which the public were accustomed to think, there was no solution. The unrestricted use of machinery challenged the existing order of society by upsetting the wage system--that is, the system of distributing purchasing power by means of payment for work done--and so they were faced with the alternatives of abolishing or curtailing the use of machinery, or of reconstructing society on some new basis that could be harmonized with its unrestricted use. Both of these alternatives were for them apparently unthinkable, if, indeed, they ever gave a moment's thought to the latter.

It was at this time, when society was perplexed by the social problems that the use of machinery presented, that Robert Owen was first led to pursue those speculations which laid the foundation of Socialist thought. The facilities for the production of wealth, which the new machinery afforded, had made a tremendous impression upon his imagination, and any idea of abolishing or curtailing its use he never appears to have entertained. Yet he saw that it challenged the existing order of society. He was of the opinion that machinery, tended by a comparatively small number of manual workers, would soon be capable of supplying the needs of mankind. What, in such circumstances, was to become of the working-class? Were they to die of starvation in the midst of plenty, or were they to live upon doles? for if existing social arrangements were to be maintained there was no other alternative.

"The demands of the poor for parish relief increased to such an extent that the House of Commons appointed a Committee on Poor Laws. Robert Owen, having found it impossible to explain his views upon the matter to a committee appointed by a meeting of the leading men of London, wrote a report for the Parliamentary Committee on Poor Laws, March, 1817. A year later he further elaborated his reforms on behalf of the working class in a memorial to the Allied Powers assembled in Congress at Aix-la-Chapelle, and in 1819 he caused one of his literary friends, probably George Mudie (editor of the Economist, 1821-2), to write a number of open letters to Ricardo on the same subject. The gist of these pamphlets was that machinery had facilitated production to such a degree that the world was becoming saturated with wealth. As long as manual labour was the main source of wealth, demand and supply balanced. Production and population were to each other as 1 to 1. In the years 1792 to 1817 the proportion changed enormously. Production to population were now as 12 to 1. As machinery worked cheaper than manual labour, the latter was being depreciated or displaced. The total wage bill of the country diminished; the working-class lost, therefore, much of the fund from which they satisfied their needs, the home market contracted, and the produced commodities remained unsold in the barns and warehouses. When the invention of the steam engine and other engines was made, either the greatest blessing or the greatest curse was bestowed upon society. At present, the latter prevailed, and a considerable portion of the British population was doomed to pauperism. It was in vain for manual labour to contend, under the present conditions, with the sinews of mechanism. On the other hand, if it were possible to make consumption keep pace with production, labour and capital would be beneficially employed, and distress would be unknown. But this could not be the case so long as private gain, and not social welfare, ruled economic life. As things stood now, production would more and more outstrip consumption, for the export trade must gradually decrease, and the home market contract, and therefore unemployment and insecurity of existence increase, until the working-classes, finding their remuneration either gone or reduced below the means of subsistence, would be goaded into fury and despair, and suddenly overwhelm our noble and beneficent institutions and lay them in ruins. `We resemble individuals standing on the narrow causeway of a surrounding abyss.' All this happened because the human mind, after countless ages of struggle with poverty and ignorance, finally succeeded in unlocking the sources of wealth; in multiplying the production forces; in rendering the production of goods easy. It was abundance that brought upon us misery! Large masses of producers were thrown upon the Poor Laws because they had produced too much wealth! How paradoxical it all looked! What was the remedy? Some said Poor Law Reform; others advised emigration. But all remedies of that kind were no good, for they did not touch the problem. The real cure lay in arrangements that would enlarge consumption and make it tally with production. Such arrangements were conditioned upon combined labour and expenditure, or communism."

We see, then, that there is a definite connection between the problems of machinery and the rise of Socialist thought. The introduction of machinery had upset the wage system, yet Owen saw that if consumption was to be made to tally with production, wages would have to be increased, and as this was impossible so long as machinery was in private hands, our competitive system, based upon the private ownership of machinery and capital, would have to be abolished and replaced by some form of co-operative or communist organization of society. Then machinery, instead of being a curse, would become a blessing, inasmuch as under such arrangements the wealth of the community would be equitably distributed, since no one would starve through lack of work.

The change Owen advocated was to be primarily social rather than political. It gave rise to the term "Socialist," which came into use among the discussions of the Owenites. Owen's idea of how to effect the transformation of society from an individualist and competitive basis to a co-operative and communist one was by organizing colonies or groups of workers on a communist basis. Several of these were organized by Owen and his followers. But they all, from one cause or another, ended in failure, and their promoters lost heavily in money over them. The central current of Owen's thought was completely communist without any admixture of private property institutions, though from 1820 onwards he began to disseminate the view that not only competition, but currency problems, were also at the root of the social misery.

The Co-operative Movement, with which in these days his name is associated, was not initiated by Owen personally. On the contrary, it was founded by leaders of the working-men who were in favour of Owenism and political Radicalism, during an absence of Owen in America. They met together and opened co- operative shops, the Rochdale Pioneers taking the lead. "When Owen returned from America and saw the co-operative undertakings, he disapproved of them, and contemptuously called them Trading Associations, frankly declaring that buying and selling had nothing in common with his co-operative commonwealth. But when he found that numerous members of these unions were inclined to support many of his views, he entered into relations with them and took a keen interest in their deliberations."

A report of one of their early meetings is interesting as illustrating that the fundamental ideas of the movement were Owenite. A debate was opened on the subject: "Machinery under competition and under co-operation." Among the speakers were Hetherington, Lovett, Cleave and Watson, all of them subsequently leaders of Chartism, and their speeches resounded with the theme that machinery is a curse under the system of capital, since all the advantages of mechanical progress fell to the share of the capitalists: machinery, on the other hand, will become a blessing under a system of co-operation, since in this way the acquirements of the human mind will benefit the whole of society.

Organized labour never accepted complete Owenism. It adhered to the Radical movement for Parliamentary reform, trade unionism, co-operation, and such other parts of his teaching as were capable of being assimilated to these purposes. From 1825 onwards the currents of thought, generated by Owen and his followers and their anti-capitalist criticism, reached the thinking portion of the working-class and created Chartism. This movement, which gradually assumed national proportions, and was in full swing in the second quarter of the nineteenth century, was nominally, as its name implies, a movement for democratic parliamentary reform. But the name was a misnomer, for in reality it was an elemental class war, and constituted a series of revolutionary attempts to re-organize society on a Socialist and Labour basis. A boundless optimism pervaded the whole movement, and it filled its adherents with the unshakeable belief that the conversion of the nation to the ideals of Socialism was at hand, for they were of opinion that the introduction of machinery had so completely dislocated society that the collapse of society was inevitable. "Of the unfulfilled prophecies," says Beer, "concerning the downfall of capitalism there is no end." Yet, with them, its imminence was unquestionable, and the re-organization of society on Socialist and Labour lines a foregone conclusion.

Yet they were mistaken. After 1848 the long period of economic crisis came to an end. Prosperity returned, not because the problem of the relation of men to machines had been faced, but because two outside factors came to the rescue, which, by stimulating activity in every direction, enabled our society to put off the evil day. The first of these was the growth of the export trade, which, during the whole of the nineteenth century, kept on increasing. And the second was the development of railway building, which created an enormous demand for labour. It was, moreover, followed by a great shifting of the centres of population from villages to small towns, and from small towns to large ones, which not only created an enormous demand for building, but effected, within certain limits, a decentralization of wealth that brought about a distributed initiative which stimulated trade. Railway building, for the most part, came to an end in the 'seventies, but the boom in building that followed the shifting of the centres of population continued until the outbreak of war.

These developments contradicted the prognostications of Owen that the export trade must gradually decrease and the home market contract. Yet the failure of Chartism is not to be ascribed to their falsification. On the contrary, Chartism fell from internal rather than external causes. Its central weakness was that it never had one mind, and to state its faith at one period of its history is not to state it at another. The central aim of Chartism throughout the greater part of its history was the conquest of political power; with this was merged a vague notion of transforming Great Britain into an aggregation of communist colonies on Owenite lines. In the midst of these there came the gospel of the Class War and the General Strike. These conflicting ideas could not be reconciled, and Chartism in turn was Parliamentarian, Syndicalist, and Owenite. Emphasis was given to one or other of these aspects as circumstances dictated. Disappointment with the Reform Bill of 1832 led to a reaction against parliamentarianism, which lasted for a decade. In 1842 the General Strike was tried and failed. After 1839 Owenism, as a social system, showed signs of falling to pieces, and in 1845, with the disastrous break-up of Queenswood, the last of the Owenite colonies, it collapsed. Thus Chartism was left without a social faith, and this, by undermining its driving power, paved the way for its ultimate failure. Chartism, as a popular movement, ended in the fiasco of 1848, leaving behind it only a few stragglers, who refused to believe that Chartism was extinct. What was left of its theories and traditions was either taken up by the Co-operators and Trade Unionists, who now withdrew from political activity, or became in turn the starting-point for new political and economic speculations.

Karl Marx was the heir of the Chartist movement. With the failure of Chartism and the return of prosperity that followed the growth of foreign trade and the development of railway building, people began to think that the difficulties of the first half of the nineteenth century were merely incidental to the transition from hand to machine production, and it was not long before the problem of machinery was obscured and forgotten so far as most people were concerned. But Marx, at any rate, had no illusions. He saw clearly that the problem remained exactly where it was, in that a return of prosperity had not been effected by facing and overcoming the economic difficulties that the employment of machinery brought with it, but by external events. The crisis had been postponed by enlarging the area of the problem. It was no longer national, but international. It had been postponed, but it could not be postponed indefinitely, for a time would come when international trade would reach its limit of expansion, and when that limit was reached, the unemployed problem would return with an increased intensity, because it would be insoluble apart from a fundamental change in the basis of society. In anticipation of that return, Marx set to work to develop a theory of society that would provide a firmer base for Socialist activity than had been provided by the fragmentary and contradictory theories of Chartism.

It is evident that Marx had anticipated the failure of Chartism, for in 1847 he had, with Engels, published the Communist Manifesto, which contains the gist of his teaching. Das Capital is but an expansion and theoretical justification of the views contained in it. In them he throws over the Utopian ideas of Owen as visionary and impracticable, and searches for the dynamic law of society, which he discovers in the Materialist Conception of History. According to this conception, society is not, as Christians would assert, the expression or manifestation of ideas and morals, but of the forces of production; or, in other words, the motive force of society is not generated by the founders of religion, philosophers, law-givers and artists, but by inventors, engineers, discoverers and labourers. It is only the latter who finally count, inasmuch as the ideas of the former are but the intellectual reactions from material conditions. Or, in other words, "In response to the stimuli of the productive forces, man builds up the social order, government, religion, morality, art, philosophy and science. The material production is the substructure or the groundwork, while the corresponding political, religious, moral, philosophical and scientific systems are the superstructure, the upper storeys of society. The substructure is material, the superstructure is the psychical reflex and effect."

This is the central idea of Marx. Applied to the world of to- day, it means that Marx considers machinery as the central creative force of the age. He agreed with Owen and the Chartists that machinery, as it is used in a competitive system, will break up existing society, but he goes further and asserts that not only will machinery break up the existing social order, but it is the appointed agent for the creation of a new one. This idea is central in his interpretation of the evolution of capitalism. According to Marx, it is not the evolution of capitalism that determines the evolution of machinery, but the evolution of machinery that determines the evolution of capitalism. The various phases through which the capitalistic organization of society passes are consequent upon the unrestricted use of machinery, and are not to be separated from it. Thus the tendency of capitalism towards centralization is dependent upon the development of railways and telegraphs, which enable a central control to be exercised. While again the development of the class-war--the idea of which he inherited from the Chartists and Continental Socialists--is the rebellion of the masses against the injustices consequent upon the concentration of wealth. The end of it will be that the balance of production and consumption will be permanently upset, and economic paralysis result. This last stage of development will be marked by the appearance of a permanent army of unemployed. Society will become sharply divided between the irreconcilable camps of capitalism and the proletariat. The workers, goaded by increasing misery, will then rise and take possession of land, capital, and the means of production and exchange, and will proceed to organize society for the benefit of all instead of for the few. At this point, where the real difficulties begin, the thinking of Marx comes suddenly to an end. He leaves us contemplating the communist society which lies at the end of the process of industrial evolution, but about the structure of it he has next to nothing to say. Its forms, apparently, can be left to the productive forces themselves to determine. There is no need to think further ahead. For, he argues, just as the forces of production in the past found their own suitable form of expression and created traditions of social order, government, law, economics, art and other arrangements, so they can safely be relied upon to fill in the details of the future, for, as he tells us, "every new social system develops its embryo within the womb of the old system."

The defeat of Chartism, as I have pointed out, was followed by a revival of trade. Prosperity returned. The development of mechanism, which hitherto had appeared as the enemy of the labouring classes, now, through the boom of railway building, began to wear the guise of their liberator. The working classes became increasingly committed to machine production, and opposition to its use became confined to such minorities of handicraftsmen as from time to time found themselves displaced by new inventions, and amid the increasing material prosperity, the existence of any problem of machinery was forgotten. People began to think that machinery was destined to become the liberator of mankind. And in this opinion they were confirmed by the theory of social evolution enunciated by Herbert Spencer. It was a comfortable belief, especially for the capitalists and the middle class, who, by means of it, were becoming so prosperous. The protests of Ruskin and the warning of Matthew Arnold, that faith in machinery was our besetting sin, were brushed aside as the irresponsible utterances of idealists and cranks, who were engaged in the vain and impossible task of stemming the tide of progress and evolution.

It was into this atmosphere of satisfaction with the achievements of industrialism, that the Socialist Movement was reborn. For ten years after the failure of Chartism there was a slump in social agitation. The working-class seemed to have abandoned politics altogether, and turned their attention to trade unionism and co-operation. All efforts to interest them in politics and the general social problem proved ineffectual, and it was not until the 'eighties that interest in Socialism began to re-awaken. John Stuart Mill had created a certain interest in the question of land reform, which prepared the way for Henry George, whose Progress and Poverty (1879) had a large and immediate sale. In 1882, when his book had attained a circulation of 100,000 copies in the United Kingdom, he came over from America and lectured in London and Ireland. The effect of his propaganda was to stimulate interest in economics among the younger generation of intellectuals and working-men. In 1884 the Social Democratic Federation and the Fabian Society were in existence. The former was avowedly Marxian. The Fabian Society, on the contrary, broke away from the Marxian tradition, and gave a new development to Socialist thought, which we must now consider.

Superficially considered, the difference between Marx and the Fabians was that, whereas Marx pinned his faith to revolution, the Fabians substituted evolution for revolution as the watchword of reform. But the real difference was that, whereas Marx knew that the problem of machinery was central in the social problem, however erroneous many of his conclusions might be, the Fabians never realized that any such problem existed. On the contrary, they accepted the comfortable optimism of Herbert Spencer, which identified the spread of mechanical production with the cause of progress, while differing with him in demanding that society should be organized on a co-operative instead of a competitive basis. Thus it came about that they were led to deny any catastrophic ending of the industrial system such as Marx predicted, and to postulate that industrial expansion had no limits. Living at a time when industrial conditions had attained to some stability, they mistook the temporary immunity from economic troubles for a condition of permanence. They failed to realize that the problem of the relation of men and machines had not been solved, but was obscured and overlaid by the development of foreign trade and the shifting of the centres of population, and would reappear, when the expansion of markets had reached their limit, if existing tendencies were to proceed unchecked. Therefore, though Marx might be wrong in assuming that the Socialist State could suddenly emerge from the débris of a ruined civilization, he was not wrong in seeing that the progressive application of machinery would result in the later phases of capitalism being marked by the appearance of a large and ever-increasing army of unemployed. Thus it came about that, having ruled out the great primary issue of industrial civilization as a matter of no account, the Fabians fell back on secondary issues, and the nationalization of land, capital, and the means of production and exchange, which had been originally advanced as a means of effecting the abolition of the wage system--a necessity if machinery was to be allowed to displace labour--was advanced as an end in itself, while "the abolition of the wage system" was discarded as a meaningless phrase which could only mislead the public as to the aims of Socialism. And Socialism, from being a movement that faced the central facts of civilization, degenerated into the issue of private and public ownership, and lost its way in a maze of Blue Books, statistics and detailed considerations; gas and water socialism, Poor Law, Housing Reform, etc., on the one hand, and political labourism on the other.

The inadequacy of Fabianism had all along been felt by many Socialists, yet it was not until the year 1908 that a reaction set in against it, which developed out of disappointment with the performances of the Labour Party in the House of Commons. This reaction took two forms. Among the intellectuals it took the form of rebellion against the bureaucratic ideal, taking eventually the form of Guild Socialism, which, in a vague kind of way, has penetrated a great part of the working-class movement, while simultaneously there was a reaction against Fabian policy among the extreme elements of the Socialist Movement, which took the form of a revival of the ideas of Class War and Marx modified by Syndicalist ideas imported from France. Both these movements have nowadays, in spite of certain appearances to the contrary, spent their force, and if the whole Socialist Movement does not suffer the same eclipse that followed the failure of Chartism, it is because the chaos of Europe and the magnitude of the unemployed problem will not allow men to forget that a social problem exists.

Whether the Socialist Movement has a future, or whether it will slowly disintegrate, remains to be seen. But that some solution must be found for the social problem, and found quickly, if civilization is not to perish, admits of no question. Meanwhile the reflection is forced upon us, that this unemployed problem is the problem that Marx foresaw; it is the problem that confronted the Luddite rioters, and which our modern Socialists in their blindness deny.

II. THE UNFULFILLED PROPHECIES CONCERNING MACHINERY

This is the first cause of confusion that has overtaken the Socialist Movement. So far from being able to find a solution for the problems of society, the movement has forgotten what is the problem it originally set out to solve. In these circumstances, the first step towards extricating society from the chaos into which it has fallen is to restore the problem of the relation of men to machines to the central position that it occupied in social theory before the Fabian Society came along. This is a necessity of clear thinking and an issue quite apart from the question as to what our particular attitude towards the problem of machinery may be. The fact that the problems of machinery occupy a central position in the social theories of both Ruskin and Marx should give us pause to think. That two great thinkers, who came to diametrically opposed conclusions about almost everything, should yet be agreed that in any analysis of modern society the problem of machinery should be given priority to all others, suggests that it should not be lightly dismissed, while the fact that modern thinkers who have chosen to ignore it find themselves not only entirely impotent to effect a change, but bankrupt of ideas as well, suggests that their premises are insufficient. In some way or other they hold their ideas in a false perspective, and though they may protest against any reintroduction of the problem of machinery as being merely an addition to the difficulty, yet I am persuaded that it will in the end turn out to be a simplification, in the same way that the introduction of a fresh term to an intricate irreducible mathematical expression will at times bring it to unity.

If then we may be agreed that the problem of machinery is fundamental, let us pass on to consider what our attitude towards machinery should be, and in this connection it will be convenient to begin by considering the prophecies of Marx--to what extent they have been fulfilled and to what extent they have been falsified by experience. For Marx, in his whole- hearted belief in the ultimate beneficence of machinery, is close to the modern mind.

In the magnitude of the unemployed problem to-day we may see at the same time the disproof of the Fabian notion of indefinite industrial expansion and the fulfilment of the prophecy of Marx that the last phase of capitalism would be marked by the appearance of a large and increasing army of unemployed. As the Fabians denied that such a thing could happen, we recognize that Marx had a grip of something fundamental that the Fabians had not. That something is the dependence of finance on machinery. Marx saw clearly that under a system of competitive enterprise machinery is inevitably used more and more, and that development upon such lines placed finance entirely at the mercy of machinery--the progressive application of which would determine the various phases of industrial development through which society would pass until the climax was reached. The truth of this interpretation is confirmed by the situation developed in Germany before the war. It is customary to attribute this situation to the failure of Germany's system of credit banks-- to the fact that she had built up her industrial system on borrowed money. But the great fact behind the financial situation is that in the fifteen years before the war Germany had quadrupled her output. The ratio of productivity in Germany due to never slackening energy, technique and scientific development was far outstripping the ratio of demand. Production was no longer controlled by demand but by plant, and the increased pressure of competition had so increased the overhead expenses that no furnace could be damped down and no machine stopped; for the overhead expenses would then eat up the profits and the whole industrial organization come crashing down, bringing with it national bankruptcy.

We miss the lesson that the war should teach us if we fail to recognize that it was finally brought about by the desperate economic condition to which Germany had been reduced by her whole-hearted pursuit of science and mechanism--pursued as ends in themselves. Such a climax was inevitable from the day that industry embarked on unregulated machine production, for it inevitably leads to the problem of over-production (or under-consumption as some people prefer to call it). The ideal of the early nineteenth-century economists, that Britain might become the workshop of the world, was a romantic illusion; for no nation can afford to be the consumer of the machine-made goods of other countries indefinitely. The suction would drain its economic resources. Each nation in turn is driven to adopt machine production in self-defence. Hence it has happened that one after another of the nations who were once our customers have taken to machine production and have been drawn into the whirlpool of industrial production. And in proportion as this came about, we were driven further and further afield in search of markets, and it was inevitable that a time would come when there were no new markets left to exploit. When that point was reached, the fundamental falsity of the whole system revealed itself in the economic paradox that drove Germany to war.

Now Marx saw clearly that unregulated machine production would reach a climax, in that some day a point would be reached when industry could expand no further. But he failed to see that the pressure of competition would, by stimulating international jealousies, result in war. On the contrary, in the Communist Manifesto he says: "National differences and antagonisms are to-day vanishing ever more and more with the development of the bourgeoisie, free trade, the world market, the uniformity of industrial production and the conditions of life corresponding thereto." And this is important, because the war has given the lie to Marx as it has done to Herbert Spencer, for it has revealed industrialism as a destructive rather than a constructive force. Before the war it was customary to regard industrialism and militarism as opposed principles; one making for peace, the other for war. Yet reflection suggests that militarism and industrialism as they exist in the world to-day are but two aspects of the same thing, inasmuch as both are expressions of the worship of wealth and the bent given to the human mind by the cult of mechanism. From an early, date they have given each other mutual support. The war has been well called a war of machines. For that is what it was. War on such a tremendous scale was impossible in the past. It needed the whole industrial apparatus to make it possible. Mechanical transport, telegraphs, tinned foods, etc. were just as necessary as armaments for war on such a prodigious scale, while the fact must not be overlooked that in the production of armaments the mechanical arts reach their highest point of perfection. The Dreadnought is just as much a symbol of the modern world as the Cathedral is of the Middle Ages.

But this is not the worst. Bad as the war was, it seems that worse is to follow. The reactions of the war have been such as to precipitate economic chaos everywhere. Wars in the past were not so destructive to society, not only because they were on a smaller scale but because the social structure, being simple, recovered after a time from the shock of war. But the unrestricted use of machinery has resulted in making our society so complex that it can only be maintained by an intricate system of exchanges. The war has wrecked the exchanges, and this is producing economic deadlocks everywhere. And there seems little prospect of society ever extricating itself from the confusion, for its complexity is such as to be beyond the comprehension of even the greatest minds.

Though Marx did not foresee the war, he did see that a fundamental antagonism existed between mechanical production and established traditions of social order and culture. He saw that the unrestricted use of machinery would end in their destruction, but he prophesied that as a result of the changed social conditions new social and cultural standards would arise as a consequence of the reflex action of machine production. This prediction I submit has been entirely falsified by experience. There is no evidence whatsoever that machinery by any reflex action is in the way of creating any new traditions to replace the ones it has destroyed. On the contrary all that follows in the wake of the machine is chaos and confusion.

The failure of sociologists to formulate any theory of society that would permit the unrestricted use of machinery was some years ago frankly admitted by Mr. H. G. Wells, who in his belief absolute in the ultimate beneficence of machinery and in his perception that the problem of machinery is central in modern society is the true successor of Marx. Thus in the introductory essay to The Great State he says: "We have, in fact, to invent the Great State if we are to suppose any Great State at all, an economic method without any specific labour class. If we cannot do so we had better throw ourselves in with the conservators forthwith, for they are right and we are absurd. . . . Our contemporary economics is, however, still a foolish pretentious pseudo-science, a festering mass of assumptions, about buying and selling and wages-paying, and one would as soon consult Bradshaw or the works of Dumas as our orthodox professors of economics for any light upon this fundamental matter."

What Mr. Wells says about modernist economics is as true to- day as it was twelve years ago when Mr. Wells wrote these words. There is a conspiracy of silence everywhere about the central problem--the relation of men to machines. Mr. Wells' subsequent career is a striking testimony to the failure of modernists to build any social theory around the unrestricted use of machinery. Alone among modernists Mr. Wells perceives the machine problem to be the central issue, and he has made valiant efforts to solve it. He has failed because I believe he has attempted the impossible. Yet he is too fascinated by machinery to admit it, and so he circles round and round in a vain hope that the problem will yield somewhere. He seems to be conscious of the fact that he cannot go forward and he lacks the courage to go back.

What is true of attempts to reconcile social theory with the unrestricted use of machinery is true of the arts. Many have been the attempts to reconcile the arts with the fact of machine production. But they have all failed. Let no one suppose that the hostility of the Arts and Crafts Movement towards machinery is based upon some incurable prejudice. On the contrary, it is a conclusion to which men are reluctantly driven by experience. There have always been as many artists who were ready to affirm that the claims of art and machinery could be reconciled as those who denied the possibility. But the interesting fact is that those who were most ready to affirm it are those whose work does not come into collision with machinery and that the new ideas of art came from those who went back to the basis of art in handicraft and not from those who exalted the machine, while any good work that has been produced by machines has merely imitated as best it could the work done by hand. That is the truth of the matter. The machine is imitative; it is in no sense creative. But while it imitates, it can only imitate certain things. There is always something omitted, some quality that does not lend itself to reproduction by machinery. That quality is temperament. There is no temperament about machine work. It can reproduce things of good proportion, of pleasing colour and design. But the temperament will be missing. It eludes the machine.

Meanwhile no new forms of art make their appearance in response to the stimulus of the machine. The Design and Industries Association has made great efforts to reconcile machinery and art. Recognizing that the Arts and Crafts Movement had failed to influence industry as a whole, it preached the gospel that the only way of reviving the arts was to come to terms with machinery. But it has failed as miserably as the Arts and Crafts Movement to exercise a widespread influence on industrial production, while it is to be observed its ideas are entirely parasitic on the work of the craftsmen. And this is not surprising when we remember that new developments in science have their roots in the experimental use of material; for what, after all, is experimental science but the counterpart of experimental handicraft? And if science cannot progress apart from such an experimental base, why should it be supposed that the arts can? The truth is that in seeking to revive the arts upon a basis of experimental handicraft artists are really adopting the method of science. But there is no opposition between experimental science and machinery; why then should there be opposition between the handicrafts and machinery? The answer is that it arises because the mechanical standard of production which satisfies science lends itself to quantitative production, while the æsthetic standards of craftsmanship do not, because the latter is impossible apart from the liberty of the craftsman. All the outfit of capitalism, its quantitative standard, its large organizations, its speed and complexity are antipathetic to the spirit of art and craftsmanship. They collide at a thousand points and all efforts to reconcile them fail in the end.

But there is a deeper reason for this antagonism. They serve different ends. Art serves spiritual ends; machinery and commercialism serve material ends. Up to a certain point these two may develop side by side and no antagonism is felt. The spiritual and material aspects of life go hand in hand. But beyond a certain point this is no longer the case. Separation begins. Henceforth further development of one side can only be at the expense of the other. It is not a case of anyone definitely willing this separation. It simply happens as a loss of balance consequent upon an undue concentration upon the problems appertaining to one side of life. It is a question of proportion. As, in chemistry, we know the elements composing any compound substance will combine with others in a certain definite and fixed proportion, and in no other, so we may say that the material and spiritual elements will only combine organically in society when they co-exist in a certain definite proportion. To translate this idea into the terms of our immediate problem we may say that mechanism is one element; art is another. They will combine organically as they did in the past when they co-existed in certain proportions. But not to-day when mechanism is abnormally developed. The fallacy of supposing that mechanism may some day issue in art has its origin in a failure to recognize that, as they are in their nature separate elements, one cannot be transmuted into the other. It is so easy to enjoy the illusion that there is no incompatibility between art and mechanism if one has never made any practical attempt to reconcile the two, but so impossible when one has. The æsthetic and mechanical standards are as different as are those of poetry and logic. And we have no more reason to expect that art will emerge at the end of the mechanical process than that poetry would result from the pursuit of logic.

There is no branch of art that in one way or another is not threatened with extinction at the hands of mechanical production, and nothing appears to take its place. The problem of architecture, it may be said, is too complex to be capable of any simple generalization. But it may be said that it is attacked on all sides by a combination of influences against which the architect is apt to struggle in vain, most of which are directly or indirectly the consequence of unregulated machine production. For a long time the only serious difficulty which the competent architect had to face was the difficulty of getting decent bricks and tiles to build with. But of late years he has got buried under a perfect avalanche of artificial materials, asbestos tiles, concrete blocks, standardized window frames, doors and other abominations which cut at the very base of any possible architectural treatment. Only on the more expensive work, which is a rapidly declining quantity, can he escape from the necessity of using such things. To believe that any new style of architecture can arise out of such conditions is to take refuge in a faith that has no relation to reality. No one in architecture really believes it, though there are some who try.

Other arts are being extinguished by the competition of mechanical processes of one kind or another. The market for painting has been ruined by cheap reproductions; music has to compete with the gramophone; the stage with the cinema; while the taste for good literature is corrupted by the deluge of thoughtless rubbish that issues from cheap periodicals.

Though inventions and machine production have damaged all the arts, apart from those that have their basis in handicraft, they are being extinguished less by any direct use of machinery than by the corruption of demand. This corruption is the natural consequence of the misuse of machinery with its monotonous grind, its ever-accelerating speed, and its indiscriminating advance which mushes things together in amorphous conglomerations of bewildering complexity. Reasonable pleasure has its basis in reasonable work. The corruption of work reacts therefore to corrupt the leisure that accompanies it. For if men are turned into machines, or are engaged in occupations that bring them no pleasure or satisfaction, their life is corrupted at its roots. It matters little if the hours of labour be reduced to six or four hours a day, the corruption will be there all the same. Under such conditions men cease to be normal. A feeling of restlessness overtakes them which, in its reactions, vitiates all natural instincts. They crave excitement, and so long as they are strong and virile, it will tend to take the form of gambling, drink and vice. But when, owing to the fatigue of industrial conditions, a generation loses its vitality, all it desires is to be amused, and so finally it takes to cinemas which make the least demand on the intelligence of any form of amusement. Thus we see that in the long run mechanical labour produces a demand for mechanical amusements. And this is natural, for culture cannot exist finally apart from life. The great cultures of the past were organically a part of a man's everyday work. They came to a man at his work and this formed in his mind a temper that responded to the higher forms of culture. Such cultures were human things to the extent that they were capable of binding king and peasant, priest and craftsman together in a common bond of sympathy and understanding. But such understanding between different classes in society is impossible if the mass of men are degraded in their work, for it is obviously impossible to build up by means of education what the day's work is for ever breaking down. Hence there arises an impossible barrier between the many and the few. The links which bound culture and life are broken, and they cannot be repaired so long as man remains a slave of the machine. And so all art and culture disappear from life, for it cannot be kept alive by the few. All must share it or none. If any art is to revive, it must be an art that is the common possession of the whole people, and such an art cannot be grafted on a machine society. On the contrary, the arts (if we may so call them) that a machine population can share, are the arts of the cinemas and the gramophone, and the only culture is the culture of mechanism, whether it be motor-cars or aeroplanes. For these are the only cultures that are a part of the lives men live. If this is the art and culture that Marx meant when he predicted that a new art and culture would arise in response to the stimuli of the machine, then in this limited sphere his prediction has been fulfilled. But they are not the arts and culture which I, at any rate, associate with the idea of the millennium, for in no sense can they be regarded as communal arts. On the contrary they are the arts of a plutocracy.

Just in the same way that machine production has created an atmosphere inimical to the arts, it has created an atmosphere antipathic to religion. The really practical challenge to Christian morals does not come from the materialist philosophy but from the machine. The old rationalists denied the supernatural character of Christianity, but they did not challenge its moral code. That challenge, it is to be observed, came from those whose ultimate belief was in the beneficence of machinery, who in some vague way imagined that machinery had rendered Christianity obsolete much in the same way that it was rendering the handicraft obsolete. Foremost among those who so believed was Marx, for the new morality that he postulates is something that is to arise as a consequence of the dissolution of the fabric of existing society by the machine, and remembering how the factory system tends to break up family life there is no doubt a connection between the two. Such an antagonism is felt by men who have lived under happier conditions in the East. Let me quote the words of a Hindoo, Rab Bharati, on this question. He says:

"What is this civilization anyway? I have lived in four of its chief centres for about five years. During that time I have studied this civilization with the little light with which my Brahmin birth has blessed me. And I must confess that I have been deeply pained by the facts that study has revealed to me. This vaunted civilization has raised selfishness to a religious creed. Mammon to the throne of God, adulteration to a science, falsehood to a fine art. . . . It has created artificial wants for man, and made him a slave of work to satisfy them; it has made him ever restless within and without, robbed him of leisure-- the only friend of high thought. He knows no peace, hence he knows not himself nor his real object in life. It has made him a breathing, moving, hustling, fighting, spinning machine--ever working, never resting, never knowing even the refreshing rest of a sound sleep. It has made him a bag of live nerves ever stretched to high tension. It has sapped the foundation of home life--and, its trunk separated from its roots, its roof-tree threatens to fall, shaken by each passing breeze. Its vulgar haste and love of sensation are invading even the realm of religion, which is being classed with fads and crazes. Its boasted scientific inventions have done more harm than good to humanity's best and permanent interests; they serve only the surface of life which alone its votaries live and know."

Sufficient has now been said to show that the prophecies of Marx and Herbert Spencer as to the glorious future that would follow the unrestricted use of machinery, which the modern world has more or less tacitly accepted, have not only not been fulfilled but show no signs of it, for all available evidence points in the opposite direction. Marx saw that in his day it was not men who were using machines, but that the machines were using men, and he therefore came to the conclusion that the productive forces have at all times been the mainspring of social development. But this does not follow. It is easy to understand why a society that refuses to regulate machinery should find itself at the mercy of its machines. But it does not follow that before the invention of machinery society was at the mercy of the tools of the handicraftsmen, for in the pre- machine days change was too slow for the productive forces to dominate the mind of men or affect in any way the social development. Still, it has been true since the days of the industrial revolution, and therefore, though we cannot accept the attempt of Marx to deduce from the social and economic phenomenon of the nineteenth century a universal law of history we can yet recognize that so far as the industrial era is concerned, he was right in affirming that the progressive application of machinery has been the central driving force in social and economic development. But we deny that such development leads to the millennium, since all evidence points to the conclusion that the use of unrestricted machinery is rapidly disintegrating the whole fabric of civilization, while nothing arises to take its place. We can agree with Marx that unrestricted machinery is destructive of old social traditions, but not that it will create new ones to replace them.

And if this is so, what becomes of the Socialist theory of society? Remember the central idea of the Socialist gospel was that unrestricted machinery would prove itself a creative force. What becomes of that gospel if we find it is merely destructive? The Socialist ideal of a common or corporate life may remain. But their theory of social development is disproved by the facts and can have no further validity for us. For remember, it is impossible to escape the dilemma by saying that the Socialist Movement makes capital rather than machinery the point of attack, since the two are so inextricably bound together that a change of attitude towards one involves a change towards the other. If machinery is destructive, then capitalism is destructive, and therefore its organization cannot form the basis of the Socialist State. Capital in the sense that it represents property and power we may still recognize as the enemy. But our conception of its nature will have so completely changed as to necessitate a new valuation.

III. MACHINERY AND THE SUBDIVISION OF LABOUR

It is true, of course, that for some time Socialists have been a little chary about social evolution. But they hesitate to make the deduction which a recognition of the failure of their central doctrine demands. If there is no evidence of a continuous social improvement, then we should recognize that society is constantly losing its way and that it may actually be reversing progress. And if it be true that society does go astray, then it is urgent that we should seek to return to the point at which we lost our way. In daily life we pursue this policy, but in the big fundamental things we do nothing of the kind. We answer those who affirm that we are on the wrong track with the assertion that we cannot put the clock back and commit one political folly after another, vainly imagining that the social confusion consequent upon economic injustices in the past may be used as a foundation on which to build the millennium of the future. Yet the evidence that industrialism is a blind alley from which we must retrace our steps or perish becomes more conclusive every day. Whatever excuse there may be for the mistaken judgments of Owen and Marx, there is simply no excuse for Socialists to-day, for "the cancer of industrialism has begun to mortify and its end is in sight," while "in a thousand ways the lineaments of the old world are reappearing through the dissipating smoke."

Once we recognize these things, we begin to understand the significance of Medievalism. Its roots are not to be found in any idealization of the past, as our critics ignorantly suppose, but in frankly facing the facts of the present, for once the human mind finds itself unable to contemplate the future of industrialism with equanimity, it inevitably turns to the past. Such being the case, Medievalism is not romanticism, but the last word in utilitarianism as all must sooner or later find out. Its value as an ideal is that it provides a convenient rallying-point from which the root fallacies of our civilization may be attacked. It challenges the conception of progress with its indiscriminating industrial advance by exalting an age which, whatever may have been its defects (and they are not to be denied), was at any rate free from the defects of the present, and thus it provides something concrete and tangible around which our thinking may crystallize. In so far as the modern world is not interested in Medievalism, it is not because it is realistic, but because it is superficial and romantic, because it lives on phrases and disregards things, because it is satisfied with words like progress, emancipation, liberty, which can be twisted to mean anything; because it hates definiteness and dogmas which are the necessary foundation of all clear thinking; because it thinks it can eat its cake and have it, and is not interested in fundamental things. For an interest in fundamental things inevitably creates an interest in Medievalism; for in it the beginnings and the origin of things that exist to-day are to be found. Hence some familiarity with the Middle Ages is necessary to see the modern world in its proper perspective, to enable us to distinguish clearly between primary and secondary ideas. And when we do learn so to distinguish, we begin to understand why the modern world must retrace its steps as it will do before long. For if it can no longer look forward with confidence, the time is not far distant when it will begin to look back. When that happens, the day of salvation will be in sight, for we shall be in possession of a vision that will co-ordinate our manifold activities.

The choice, as I see it, is not between whether we are to go forward or to go back, but whether we are to continue drifting towards an inevitable social destruction or resolutely retrace our steps until we rest again on a firm foundation. Modernists who devise this scheme and that to cure our social ills lose sight of the fact that modern society is in such a state of unstable equilibrium that it cannot stand still. It must either move forward or move back. Now that we are all agreed that we cannot with safety move any further forward, wisdom suggests that the only rational thing to do is to go back. That the modern world should hesitate to make such a choice is not surprising, for the implications are enormous, while it is so much easier to swim with the current than against it; therefore, unless people are very clear in their minds they shrink from such a decision. Yet come to it finally they must; if not by choice, then by pain and suffering, for there is no third alternative. It is quite useless to attempt to reform secondary things whilst ignoring primary and fundamental ones. It is only playing at reform. If there is no public interest in these questions, it is our business to create an interest, and not to wait until it is too late.

But, as a matter of fact, there is a public interest in these questions, but unfortunately not in reformist circles, whose members live in a world of economic abstractions. The Socialist Movement began, as we have shown, in an attempt to find a remedy for the problems which followed the introduction of machinery, and to that problem it will return before long, because nowadays, when there are no new markets left to exploit, every new machine must result in the displacement of labour. This fact must force the question to the front. The subject has to be created. It would be no use beginning with any cut and dried scheme as to what requires to be done until people are familiar with the facts. For the present, all that can be demanded is that before any new machine is permitted to be used it shall be made the subject of a public inquiry, which shall take evidence as to its effect upon conditions of labour, upon employment, upon the crafts and arts, and all other social and economic implications. Only when the Commission was satisfied that its application would be beneficial should its use be allowed. If labour were displaced, those who profited by the new invention should be made responsible for the maintenance of those whose livelihood they took away. This demand that the use of machinery be regulated rests finally on precisely the same grounds as any other kind of regulation. Firstly, to restrain those whose motives are bad from injuring society by their actions, and secondly, to prevent those who with the best of motives do things through ignorance which are harmful in their results.

If such a law could be enacted our victory would be won, for the evidence that only evil follows the unrestricted use of machinery is simply overwhelming, as all who have taken the trouble to inquire are well aware. Facts would be revealed that would set people thinking about the question of regulating machinery, and the need of setting to work to re-create the traditions of civilization that we have so thoughtlessly allowed to be destroyed. Once attention was turned in this direction a current of thought would be created that would grapple with the realities of the situation, for it would break the spell of that mechanical hypnotism that lures us to our destruction.

The problem of machinery has then a positive and a negative aspect. Its negative aspect is to prevent the further destruction of the traditions of civilization, and its positive is the re-creation of such traditions as the misuse of machinery in the past has destroyed. But when we come to think of things in this way, we begin to see that though machinery has been the more active agent in the destruction of our traditions, yet it is by no means the only agent, and that it would not have been anything like so destructive had it not been introduced into a society whose traditions had already been partly undermined by the subdivision of labour, itself a consequence of the defeat of the Guilds, which defeat handed over industry into the hands of the exploiting capitalist.

Our criticism of the use of machinery has not been directed against machinery as such, but against its unrestricted use and the deliberate ignoring of its social and economic consequences. But with the subdivision of labour which lies behind the misapplication of machinery it is different, since it appears to us to be an entirely indefensible and degrading institution, and as such it should be entirely abolished. To explain what I mean in this connection it will be necessary to differentiate between the division of labour, which is a natural and normal thing, and the subdivision of labour, which is both unnatural and abnormal.

The division of labour is a necessity of any civilized society since, as it is obvious that a man cannot supply all his own needs, the labour of the community must be divided between different occupations. To some extent a man is inevitably dependent on others. Hence it was that no sooner did civilization begin to develop than men tended to become specialized in different trades and occupations. One man became a potter, another a weaver, a third a carpenter, and so forth. Up to this point the division of labour is justified, not merely because it is a necessity of civilization, but because it enlarges the life of the individual and his opportunities for self-expression. In the seventeenth century, however, under the impulse of profit-making, a further development took place. Measures were taken to increase the output and decrease the costs of production by the subdivision of trades into a great number of separate processes. The classical example of the subdivision of labour is that eulogized by Adam Smith in the Wealth of Nations, namely, pin-making, in which industry it takes twenty men to make a pin, each man being specialized for a lifetime upon a single process. Scientific management, about which we hear so much in these days, carries this system to its logical conclusion, and as such it completes the factory process. The subdivision of labour attacks the craft and it reacts upon the man. Scientific management, however, attacks the man direct, its acknowledged aim being to increase output further by the elimination of all motions of the arms, fingers and body that do not contribute directly to the fashioning of the article under process of manufacture.

The subdivision of labour and its recent development into scientific management are the curses of industrial civilization, for by reducing men to the level of automatons, they reduce them to the position of mere fragments of men; they undermine their spiritual, moral and physical life, and disintegrate their personality, while by giving rise to gluts in the market they lead inevitably to sweating and economic insecurity. Together with these evils, they are responsible for a progressive functional atrophy of the aptitudes of man. Dr. Austin Freeman, in a book to which I have already referred, draws attention to the evidence of the degeneracy of the British "sub-man," as he calls the victims of this system. "Compared with the African negro," he says, "the British sub-man is in several respects markedly inferior. He tends to be dull: he is usually quite helpless and unhandy; he has, as a rule, no skill or knowledge of handicraft, or indeed knowledge of any kind. The negro, on the contrary, is usually sprightly and humorous. He is generally well-informed as to the flora and fauna of his region, and nearly always knows the principal constellations. He has some traditional knowledge of religion, myths and folklore, and some acquaintance with music. He is handy and self-helpful; he can usually build a house, thatch a roof, obtain and prepare food, make a fire without matches, spin yarn, and can often weave cotton and make and mend simple implements. Physically he is robust, active, hardy and energetic." Yet in a boot factory there is not a man who can make a pair of boots, while the factory hands are, as a rule, of very poor physique: they are small and stunted, with bad teeth, and suffer much from pulmonary and digestive troubles. Such are the fruits of progress to which we conveniently turned a blind eye so long as there was money in it.

Of course, this system cannot last. To use Dr. Freeman's language, "its own activities have generated toxins which are poisoning it." For while on the one hand it is giving rise to wholesale incompetence, on the other, by destroying all charm in work and turning it into hated toil, it has generated a spirit of class hatred that expresses itself in revolt. Moreover, it uses up our natural resources at such an alarming rate that, apart from any other consideration, the life of the industrial system is seen to be very limited. Most people, on first acquaintance with the subdivision of labour and scientific management, feel an instinctive repulsion towards it. They feel it is wrong, yet cannot say exactly why. They cannot find an answer to the arguments by which it is defended. And, indeed, there is no answer, if we accepted the quantitative standard of capitalism as the final test of rightness in industry; for there can be no doubt whatsoever that this system does increase the volume of output. To challenge this system successfully it must be approached from the human end, from the point of view of quality rather than quantity, of the producer rather than the consumer. Only when we affirm that human values shall take precedence over commercial values do we see the system is cruel and inhuman, destructive alike of personality and happiness, since by forcing the individual into a narrow groove it thwarts the creative impulse which is inherent in man, and as constructive instincts when suppressed become destructive, it comes about that men to-day, suffering from the tyranny of our industrial conditions, are everywhere sub-consciously seeking the destruction of the system that thwarts them. How much of the labour unrest has its roots in the denial of pleasure in work it is impossible to say; but that there is an intimate connection between the two, and that the impulse of labour to-day is destructive, cannot easily be denied.

But it is not only the impulse of labour that is destructive. The same anarchist impulse penetrates every class. It is at work in every department of life. Over-specialization is the bane of the modern world, and it affects the intellectual worker, not perhaps in the same degree, but with consequences that are as potent for evil as those which are to be deplored in the world of labour. For just as the machine tender becomes atrophied in certain directions, so the intellectual specialist, by developing one side of his mind at the expense of the other sides, tends to lose balance and his judgments are apt to be anything but reliable. In the Middle Ages the cultural idea was that of unity, but with the Renaissance universality took the place of unity as the aim of education. The consequence of this change of direction was that, as it is impossible for any single individual to be universal, the growth of the idea of universality was accompanied by the growth of specialization, and the field of thought became divided among many specialists. These again have been divided and subdivided until any sense of a central and co-ordinating idea has for the most part disappeared from among modern intellectual workers. It is said that in Germany specialization had before the war reached such a degree of development that each individual became a monomaniac on his own subject and was largely ignorant of every other, to the detriment of general culture. This was the Kultur that gave to the Germans their sense of superiority over other peoples, and was a contributory cause of the war. Specialization up to a certain point we must have if civilization is to exist at all. But a limit must be placed somewhere if men are not to disintegrate morally, intellectually and spiritually. This intellectual specialism is the counterpart of the subdivision of labour, and they act and react upon each other to render society increasingly unstable. There is an intimate connection between the convulsions that have overtaken society and this over-specialization, which in one direction tends towards hysteria and in the other towards the dissolution of such social and intellectual traditions as are capable of binding men together in a common bond of sympathy and understanding.

I said that to the development of specialization a limit must be placed somewhere. In the intellectual world no line can be drawn and the only remedy is to exalt the idea of a cultural unity. But in industry it is different. There a line can and should be arbitrarily drawn, and I submit it should be placed at the point craft development had reached before the subdivision of labour replaced the division of labour. To suffer specialization to proceed further is, to use an engineering term, to trespass on the margin of safety. A stable society is one that permits a wide margin of safety. The far-seeing statesman might recognize that wealth could be increased by the organization of industry upon the basis of the subdivision of labour. But he would also recognize that there was another side to the question, in that an increase of wealth secured by means of the subdivision of labour imperilled the stability of society by trespassing on the margin of social, psychological and economic safety. It was the recognition of this danger that led the Tudors and the Stuarts to assume a conservative attitude towards industrial developments, and is the reason why their ideas and measures were not appreciated by commercial men, who are invariably blind to everything except immediate advantages. But experience has proved that their suspicions were more than justified, for every day evidence accumulates that we only proceed further along the road we are travelling at our peril. Hence the conclusion becomes inevitable that the qualitative standard will have to replace the quantitative one before it will be possible to stabilize society. In other words, if society is to be reconstructed on a basis that allows for a margin of safety, scientific management and the subdivision of labour must be abolished, and a return be made to handicraft as the basis of production, using machinery only in an accessory way. If this were done, machinery might become a blessing instead of the curse it is to-day. It is because the development of machinery has for the most part followed along the lines laid down by the subdivision of labour that it has been so grossly misapplied.

The principle, then, for which we contend is that if machinery is not to be a curse we must, in our use of it, never lose sight of the fact that human values come first. At all costs the traditional normal human relationships that are to be found at the centre of a normal society must be restored and the use of machinery be limited in such a way as not to interfere with them. If this principle had been always kept in the forefront, then the subdivision of labour would never have come into existence, nor would machinery have been so misapplied. But, unfortunately, instead of taking their stand on this principle as final and irrevocable, a few are tempted by the prospect of immediate gain to depart from it; while the many allow themselves to be cajoled into acquiescence in such abuses by the inference that in objecting to such a method of work they are ignorant and narrow-minded people who are engaged in the impossible task of stemming the tide of progress. Yet nowadays, when the evils consequent upon this development have become too glaring to be concealed any longer, when the prophecies of those who opposed the introduction of machinery have been entirely fulfilled, progressive-minded people are still unwilling to admit the system to be finally and fundamentally wrong, and they hope to restore the creative impulse which this system has destroyed by shifting the worker from one process to another. As some mitigation of the deadly routine to which the factory worker is condemned, there may be something to be said for the proposal, but that it touches in any way the fundamental difficulty is to be denied, for the creative impulse in man can be no more liberated by such means than he would be liberated from a prison because he enjoyed the privilege of being moved from one cell to another. It is not true, as advocates of this reform maintain, that "the creative effort is not necessarily an individual matter." How groups of people are to associate together "with a single creative purpose and endeavour" I am entirely at a loss to understand. Yet to affirm that such a thing is possible is the desperate position into which those who maintain that our industrial system has a future are finally driven.

The truth is, of course, that all creative work is finally personal. It originates in one mind, though the assistance of others may be used to carry it into effect. Thus the production of this book is a work of co-operation. I write it, the compositor arranges the type, the bookbinder binds it and provides the cover. We co-operate it is true, but we co-operate as a hierarchical order, not as a democracy. Even if the views expressed were the views of a committee instead of being my own, the committee would not write the book. It would need to delegate one of its members to give them expression. So again in respect to building. The architect is responsible for the general design; he may embody the suggestions of others. Yet finally the general design is the work of one man. In the Middle Ages it was the custom for each craft to supply its own details and ornaments. Yet the general arrangement of each building was the work of one man. We speak of the architecture of the Middle Ages being democratic, and it was democratic in the sense that the individual worker enjoyed a liberty in respect to the details of his work that is impossible to-day, and might rise to the position of master builder who exercised the function that the architect exercises to-day. Yet it was hierarchical at the same time. No building was the work of a committee, but of an individual who knew how to avail himself of the creative capacity of his subordinates. Such co-operation was possible in the Middle Ages because all shared in a communal tradition of art. It is impossible to-day because no such communal traditions exist.

It is to this Medieval system that we must get back. It is not incompatible with the use of a certain amount of machinery for doing the rougher and heavier work that lies at the base of industry, but it is incompatible with the subdivision of labour, for that cuts at the roots of the creative impulse, and therefore it must be abolished. As to the practical application of such principles, there is no difficulty at all in knowing what is meant by the abolition of the subdivision of labour, but when we demand that the use of machinery be limited many people suppose there is a difficulty about drawing the line. And, of course, there is a difficulty until we are clear in our minds as to why it should be regulated. But if we were firm in our belief that the creative impulse is natural to man, we are in possession of a principle that would guide us. There would be no difficulty in knowing where the use of machinery should be prohibited. Anyone of æsthetic sensibility with any practical experience of craft production would know instinctively where the line should be drawn, and the public could easily find out if they meant business. Their difficulties are really imaginary, since if they were persuaded of the necessity or desirability of regulating machinery, they would trust the judgment of men with experience of craft production to give effect to their wishes as they do in other matters where expert knowledge is required.

If the principles I have enunciated were followed, the volume of machinery would be reduced enormously in bulk. We should not require a tithe of the machinery that we use to-day. But we should be better off, since for a long time we have not benefited by our increased capacity for production. In the early days of industrialism the increased use of machinery did confer material benefits, but for a long time new machinery has done little more than increase competitive waste. More cotton and woollen goods are produced, but the quality is lowered to preserve the balance between demand and supply. As costs of production have decreased, selling costs have increased by reason of the ever increasing expenditure on touts, salesmen, advertising, and the growth of cross distribution. Further, the growth of artificial conditions of life that has followed our excessive use of machinery makes living ever more costly and more unsupportable. An increasing proportion of our income is spent on train fares, 'bus fares, postage, rent, taxes, etc., which all tend to go up. Meanwhile the growing disproportion between industrial and agricultural life tends to increase the cost of living. Thus our earnings run to waste, and though inflated prices are falling, yet the factors which tend towards a steady rise of the cost of living are permanent.

But it will be said: These things may be so, yet it is hopeless to attempt to abolish the division of labour or to limit the use of machinery. The workers at the time of the Chartist agitation hated the factory system which fell upon them with such cruel force, and might be rallied to the support of a movement that would keep mechanical production within bounds. But it is different now. The worker of to-day has little of this spirit in him. He has no experience of the handicrafts, and so he accepts the system into which he was born as a part of the natural order of things. He has become too much a part of the system to rebel against it. To which I answer, that while not denying the truth in such scepticism, yet the question is not finally how I or anybody else is going to change the industrial system, but how the capitalists and their apathetic multitudes are going to preserve it from destruction. This problem becomes every day more pressing. Now that the markets are no longer expanding, every new machine introduced displaces labour, and unemployment is becoming as chronic as it was in the Chartist period, and this will lead men to think again about the machine problem as they did then. Already men are beginning to talk about the displacement of labour by machinery. I have heard more people talk about it during this last six months than during the whole of my life. Let us wait a little, and what the few who are directly affected are saying will soon be in everybody's mouth. The newspapers have not got hold of it yet, but maybe the day is not far distant when the Spectator will begin to think as it thought in the forties and reprint the article which it then headed "More factories--more pauperism." Anyway, we are back in the Chartist period with this difference. That as neither railway building nor the expansion of foreign markets offer us a path of escape, and there is no other way out that we can see, the industrial problem must remain insoluble until its central problem--the relation of men to machines--is faced.

IV. MACHINERY AND ECONOMIC THEORY

Now, on first acquaintance these two schools of thought appear to be entirely irreconcilable. Yet both are at bottom conditioned by their attitude towards machinery. The Socialist attitude, as we saw, had its origin in the fact that after 1806 machinery began to displace labour. Owen saw that if society was to remain stable, an increase of production must be accompanied by an increase in consumption. Yet machinery, by reason of the fact that it displaced labour, tended to undermine consumption. It was manifest that the wage system--the system of distributing purchasing power by means of payment for work done--was breaking down. What, then, was to become of the working-class under such conditions? If society was to continue on the existing individualistic competitive basis, he concluded, the workers must perish. Hence he demanded the substitution of a communal or co-operative organization of society in place of the competitive one, and this involved the abolition of all private property. We see, therefore, that the Socialist demand for the abolition of private property was necessitated by the need of guarding society against the evils which accompanied the unrestricted use of machinery. It is true that the idea is much older, and is to be traced back to the Medieval Communists, who maintained that the existence of private property was contrary to the teaching of Christ. But the idea made little or no headway until machinery threatened the stability of the old order, and though the motive that led the early Socialists to this conclusion has been lost sight of, yet there can be no doubt that the sense of insecurity that has followed the spread of machine production has led to the widespread acceptance of the idea of abolishing private property.

But it is no easy matter to abolish an institution so deep- rooted as that of private property. It is now a century since the idea was first promulgated, and yet, in spite of the fact that it is widely believed in, and many thinkers have worked out schemes for the transfer of property from private to public ownership, we are as far from its realization as ever. Meanwhile a suspicion gains ground that it is not only impracticable but undesirable. Guild Socialists dealt it a telling blow by attacking the organization of society on a bureaucratic basis which it involved, while Distributivists challenged the idea direct. They maintained that the evil did not reside in the institution of property as such, but in the fact that at the present time the idea of responsibility attaching to property had broken down while so very few people possessed any property at all; that the possession of property guaranteed a man independence; and that it was indispensable to the performance of active function. It must not be abolished, for to do so would be to make every one servile pensioners of the State. This theory, whose principal advocates were Messrs. Belloc and Chesterton, found many supporters, but the difficulty of basing any practical activity upon it was equal to that of the opposed theory of the nationalization of property, for it was evident that it had no relevance to the existing situation apart from the dissolution of industrialism and the restriction of the use of machinery, for it is impossible to solve the problem of industrial capitalism on this basis.

Mr. Tawney attempts the discovery of a via media. He holds that opposing theorists have usually been discussing different things. The Socialist is primarily concerned with the problem of industrial capital, while the Distributivist thinks primarily of an agricultural community in the future. He attempts therefore a reconciliation of these opposed theories by means of a careful discrimination between different kinds of property, which, as he says, is the most ambiguous of categories. He distinguishes between two kinds of property: that which accompanies the performance of function and that in which ownership is divorced from use, and while he proposed to retain the institution of property in so far as it is accessory to function, he proposes to abolish all types of property in return for which no function is performed, thus effecting a return to the Medieval principle of reciprocal rights and duties. Or to put it another way, he proposes that the Distributivist position be accepted in so far as it can be applied. But with regard to industrial enterprises where it cannot be applied, he would vest the ownership and control in the hands of professional organizations of the workers, i.e. Guilds. Though Mr. Tawney has by his analysis done a great deal to clarify the issues, his position seems to me to be weak to the extent that he assumes our industrial system to be a thing of permanence, for though he criticizes industrialism, he yet does not regard the unrestricted use of machinery on a basis of the subdivision of labour as its essence. On the contrary he maintains that its evils arise entirely from a state of consciousness--a particular estimate of the importance of industry which treats industrial activities as an end in themselves rather than as a means to an end. But surely such an explanation is inadequate, for it is impossible to suppose that such a state of consciousness could ever have come to dominate society in the way it does apart from the existence of our mechanical means of production. It is equally impossible to suppose that such a state of consciousness can ever be expelled from society so long as the subdivision of labour and the unrestricted use of machinery is permitted, since so long as such methods of production obtain, other interests will be crowded out of life. To attack industrialism as a state of consciousness and to refuse to attack it as a method of production appears to me to be as futile and illogical as it would be for an anti-militarist to concentrate the whole of his attack on the mentality of jingoes, while denying that the limitation of armaments was germane to the issue. It may be true that the peril of militarism is not to be found finally in armaments, but in the mentality of the military caste, yet we are all aware that their potentiality for evil bears a definite ratio to the armaments in their possession.

When we turn from a consideration of the problems of property to those of currency, which have attracted so much attention of late, we find that the fact that the unrestricted use of machinery is taken for granted is finally at the root of the perplexity in which the subject is involved; since apart from such an assumption there would not be so much discussion at cross purposes, and the issues would resolve themselves into those of morals and organization. The truth about currency is simplicity itself. It is that money used as a medium of exchange only operates to the public advantage when it is at the same time used as a common measure of value, or in other words, when it stands in a close and definite relationship to the real values it is supposed to represent. All the supposed problems of currency which often lead people to believe in the existence of a kind of economic witchcraft arise from the fact that people who are interested in finance have no intention of using money as a common measure of value. On the contrary, they want to use it for the purpose of making more money, and this is where the trouble begins. In the Middle Ages this clear, moral issue was recognized, but in our day it is obscured by the fact that the restriction of money to its legitimate use as a common measure of value is incompatible with the idea of industrial expansion. Most people take it for granted that such expansion is a natural and normal thing to which there are no limits, instead of being what it really is, a very abnormal thing, due to the unrestricted use of machinery on a basis of the subdivision of labour, and that the limits of such expansion have now been reached. In consequence, they reject the simple truth that the only legitimate use of money is as a common measure of value as entirely irrelevant, even when as Socialists they have no financial ambitions themselves. The trouble is that the average man to-day, being divorced alike from religion and art, can only think in terms of quantities. The idea of progress to him is a quantitative conception, and he therefore rejects all ideas that involve the abandonment of the quantitative standard, though if he could only see, it is precisely because such ideas do challenge the quantitative standard that they should be followed, since only the replacement of the quantitative standard by a qualitative one can emancipate society from the tyranny of circumstance in which it is enmeshed. There can be no doubt whatsoever that industry will never move in the direction of a qualitative standard until a boundary has been put to the quantitative one.

It always happens that when the simple truth of things is rejected a subject becomes involved in contradictions, and so it has come about that students of currency, having rejected the idea that money should be used as a common measure of value, oscillate between a belief in the efficacy of the gold standard and of paper currency. The faith of the commercial world is on the whole in favour of the maintenance of the gold standard, while currency reformers are invariably advocates of a paper currency. The theories of the advocates of Free Banking to-day bear a remarkable likeness to those of the currency reformer, Thomas Attwood, who a century ago advocated the same measures to meet the same problem. They are agreed that the gold standard is the root of the trouble, and demand its abolition. The employment of labour and the production of wealth are only rendered possible through the agency of the circulating medium. Hence it follows that every increase of trade should be accompanied by a corresponding increase in the volume of currency in circulation, or a currency becomes unequal to its duties, and booms in trade are automatically and abruptly brought to an end. But such expansion of the currency is impossible so long as currency remains on a basis of gold, because as the supply of gold is limited, a currency based upon the gold standard is incapable of expanding with the expansion of trade. Hence they demand the removal of all restrictions on the issue of paper money, for on such a basis a currency, can expand indefinitely. The answer of those who defend the maintenance of the gold standard is that if no artificial check exists to the issue of currency, money soon loses touch with the real values it is supposed to represent; for the wholesale issue of money results in a depreciation of the currency, which, under such conditions, tends to fall and fall until the value of notes is worth no more than the value of the paper on which they are printed, as has happened in Russia, Poland and other parts of the Continent. While again, if there was no restriction of the issue of credit there would be nothing to ensure that goods produced would bear any relationship to demand, inasmuch as if credit were made available in unlimited quantities there would be no check on the production of unwanted articles.

But if the upholders of the gold standard can successfully refute the arguments of the Free Bankers, they can finally only do so by arguments that can be turned against themselves. For if it be true that an artificial check on the issue of currency and credit is necessary to prevent, on the one hand, money losing touch with the real values it is supposed to represent, and on the other to ensure that the actual production of goods shall be such as is in demand, it demonstrates the impossibility of industry ever getting on a stable basis so long as speculation remains the driving force in industry. But if speculation is to be eliminated from the conduct of industry, it can only be on the assumption that money be restricted to its legitimate use as a common measure of value, and if it be so restricted, what becomes of industrial expansion?

Without doubt my efforts to connect the problems of currency with that of the unrestricted use of machinery will sound to many of my readers like special pleading. Yet I am not really so heterodox as I appear, for it so happens that the City Editor of The Times, in answering Mr. Kitson's articles on Unemployment in which he develops the ideas of Free Banking, found he could only refute him by assuming what is substantially the same position, for he says: "The solution of the unemployment problem lies not in the manufacture of money but in the regulation of complementary production." Such an admission coming from such an orthodox quarter is not without significance, for if it does not mean that machinery should be regulated and speculation suppressed then I can only ask What does it mean?

We see then that on its present basis the subject of currency is a vicious circle from which there is no escape apart from a change in outlook. So long as currency reformers accept the exigencies of the industrial situation as the starting-point of their analysis, they must inevitably arrive at the contradictory conclusions already described, while the utmost that they can possibly achieve is to devise some means of perpetuating the existing system of industry; they cannot hope to lay the foundations of a new one; since any new system must not only be based upon the principles of justice and equity, but upon the assumption that in any new society machinery will be controlled and the subdivision of labour abolished, and if such measures were taken, nothing apart from moral perversity could stand in the way of a return to the Medieval idea that currency should not only be a medium of exchange but a common measure of value, and the only way of ensuring such a desideratum is to fix the price of everything, since so long as prices are left to be determined by the higgling of the market, the merchants and middlemen, because they specialize in market conditions, will remain in a position to exploit the community by speculating in values.

But how can fixed prices be maintained? Conventional critics are apt to dismiss the idea as altogether unpractical, maintaining that in times of crisis fixed prices have been resorted to time after time as a remedy for the evil of profiteering and that they have invariably failed. It is not necessary to dispute such facts, but to point out that the failures to fix prices of which history affords many examples were due to the fact that such attempts were of the nature of panic legislation rather than part of a methodical plan. The attempt to fix prices during the French Revolution is a case in point. It failed because there were no organizations in existence to give effect to the decision of the Convention. But such critics appear to be unaware that under the Medieval Guilds fixed prices were maintained for several hundreds of years. Indeed it was to perform this very task, to guard society against the evils consequent upon speculation in prices that the Guilds first assumed economic functions. Prior to the eleventh century when this new development took place, Guilds were already in existence. Any group of men who had any common interest organized themselves into Guilds. There were Guilds for social and religious purposes, for mutual aid, for defence, for common aid in legal matters, for fishing and hunting, for repairing the highways and bridges, etc. Such Guilds would be very much like the voluntary, associations that exist to-day for all kinds of purposes. But in the eleventh century, when order was restored after the barbarian invasions, which in the ninth and tenth centuries had involved Europe in chaos, there began a great moving of the stagnant waters. Trade began to develop, markets were established and towns began to come into existence. It soon became apparent that such commercial development was not an unmixed blessing, and to meet the new danger that threatened society, the Church came to insist upon two doctrines--that wares should be sold at a Just Price, and that usury was sinful--and enforced obedience from the pulpit, in the confessional and in the ecclesiastical courts. So effectually were these two doctrines impressed upon the consciences of men that their principles found their way into all the secular legislation of the period whether of Parliament, Guild or Municipality.

The differing fortune which followed legislative attempts to secure obedience to the principle of the Just Price is instructive, for it demonstrates beyond doubt the superiority of the Guild as an instrument for the performance of economic functions. Parliament could do nothing more than enact laws for the prevention of profiteering in its various forms of forestalling, regrating, engrossing and adulteration, and as such it was negative and finally ineffective. The Guilds, on the contrary, were positive. They sought to give effect to the principle of the Just Price by making it at the same time a Fixed Price. And around this central idea they gradually built up the wonderful system of corporate life of the cities. Thus in order to perform their economic functions, the Guilds had to be privileged bodies, having a complete monopoly of their trades over the area of a particular town or city; for only through the exercise of authority over its individual members could the Guild enforce a discipline. Profiteering and other trade abuses it ruthlessly suppressed: for the first offence a member was fined; the most severe penalty was expulsion from the Guild, which meant that a man lost the privilege of following his trade or craft in his native city.

But a Just and Fixed Price cannot be maintained by moral action alone. If prices are to be fixed throughout industry, it can only be done on the assumption that a standard of quality can be upheld. As a standard of quality cannot be defined in the terms of law, it is necessary, for the maintenance of a standard, to place authority in the hands of craftmasters, a consensus of whose opinion constitutes the final court of appeal. In order to ensure a supply of masters it is necessary to train apprentices, to regulate the size of the workshop, the hours of labour, the volume of production and so forth; for only when attention is given to such matters is it possible "to ensure the permanency of practice and continuity of tradition, whereby alone the regulation of the Guild for honourable dealing and sound workmanship can be carried on from generation to generation," and conditions created favourable to the production of masters. Thus we see all the regulations--as indeed the whole hierarchy of the Guild--arising out of the primary object of maintaining the Just Price.

But it will be said: If the Medieval Guilds were such excellent institutions, why have they disappeared? The immediate cause was that they were not co-extensive with society. They existed in the towns, but they never came into existence in the rural areas. That was the weak place in the Medieval economic armour; for it is obvious that if a fixed price was finally to be maintained anywhere it would have to be maintained everywhere, both in town and country. That Guilds were never organized in the rural areas is to be explained immediately by the fact that in the eleventh and twelfth centuries, when Guilds were organized in the towns, the agricultural population was organized under Feudalism and money was only beginning to be used, so the problem was not so pressing. But the ultimate reason is to be found in the fact that the impossibility of maintaining, in the long run, a Just Price that was not a fixed price was not at the time appreciated by the Church, which appears to have been blind to the need of Guild organization for its maintenance. It thought, as religious people are apt to think to-day, that the world can be regenerated by moral action alone, never realizing that a high standard of commercial morality can only be maintained if organizations exist to suppress a lower one. Hence it came about that when in the thirteenth century the validity of the Just Price came to be challenged by the lawyers, who maintained the right of every man to make the best bargain he could for himself, basing their authority upon the Justinian Code, belief in the infallibility of which had accompanied the revival of Roman law, the moral sanction on which the maintenance of the Just Price ultimately rested came to be undermined. It lost its hold on the country population, and the Guild regulations came to be regarded as unnecessary restrictions on the freedom of the individual. Thus a way was opened in rural areas for the growth of capitalism and speculation, and this reacted to make it increasingly difficult for the Guilds to maintain fixed prices in the towns, until at last, in the sixteenth century, the whole system broke down amid the economic chaos that followed the suppression of the monasteries and the wholesale importation of gold from South America, which doubled prices all over Europe. Since then, capitalism has carried all before it.

V. MEDIEVAL AND NATIONAL GUILDS

Now, such advice sounds very plausible, so plausible, in fact, that to most people it must appear as if nothing but sheer personal perversity prevents us from accepting it. Yet this is not the case, since Medieval and National Guilds are not opposed ideas, as is popularly supposed, but complementary ones; while the success of the National Guild Movement in no way excludes or militates against a revival of Guilds of the Medieval type, as will become evident when the position is clearly understood. They are concerned with different things. National Guilds are concerned with the problem of the large modern industry, and it would tend towards the elucidation of the subject if they were called Industrial Guilds rather than National Guilds, which is a misnomer. The advocates of Medieval Guilds, on the contrary, are primarily interested in the crafts, small industries and agriculture, and they are as much concerned to discover how such activities may be restored to their former integrity as they are in bringing them under Guild control. Such being the case, the relative importance which we attach to these two branches of Guild activity depends entirely upon our opinion as to what will be the future of Industrialism. If it is believed, as National Guildsmen did believe, when their theory was first launched, that the future is entirely with the large industry, before whose advance the crafts must eventually disappear, then Medieval Guildsmen will appear as anachronisms. But if, on the contrary, we recognize, as Medieval Guildsmen all along have recognized, and as National Guildsmen have recently come to believe, that our industrial system is a thing altogether abnormal, carrying within itself the seeds of its own destruction, and is even now on the verge of collapse, then the subject begins to wear a different complexion. The Medieval Guildsman will no longer appear as an anachronism, but as a Futurist in the best sense of the word, inasmuch as he is not content to build his house on the sands of the seashore. Such a view of the fate of industrialism in general is not incompatible with the frank recognition of the fact that certain aspects of the system may survive, while, if we do not come to the conclusion that National Guilds have no validity in the future, we at any rate may recognize that in any normal society the area of their activities will be very much circumscribed.

But there is another path of approach. We may approach Medieval Guilds from the point of view of craft organization, or from the point of view of the moral and economic principles that they existed to uphold. If we look at them from the former point of view, their picturesqueness may interest us, though their possible application will appear circumscribed. But if we look at them from the point of view of the moral and economic principles they existed to uphold, we shall come to recognize them as the type and exemplar of all true institutions, inasmuch as they stood for something that has universal validity, and is in no way limited by the details of their organization. From this point of view, the issue between Med