The Boston _Commercial_ in 1913 called attention to the fact that in France the year 1912 was marked by the largest increase in gross receipts on record, for both government and privately owned railroads, but the privately owned roads showed an improvement in net earnings almost three times as great as that of the nationalized railroads. These failings noted above are almost inevitably found wherever the government owns the railroads or other utilities, or else these utilities are run at a loss and the difference made up in the tax bills of the people.

Government control never is as efficient and economical as private control, even though all questions of political power and influence be omitted from consideration.[10]

The important testimony of Mr. W.M. Acworth, an English authority upon railroads, which he gave by invitation before the Senate Committee on Interstate Commerce at Washington, has not been fully appreciated by American public opinion. The National City Bank of New York rightly stressed the importance of this testimony in one of its bulletins during the year 1918. Mr. Acworth was in this country during the early part of 1917 as a member of the special Canadian Commission on Railways, and he told the Senate Committee that "while American companies have revolutionized equipment and methods of operation, Prussia has clung to old equipment and old methods. This is typical. In all the history of railway development it has been the private companies that have led the way, the State systems that have brought up the rear. Railroading is a progressive science. New ideas lead to new inventions, to new plant and methods. This means the spending of much new capital. The State official mistrusts ideas, pours cold water on new inventions and grudges new expenditure. In practical operation German railway officials have taught the railway world nothing. It would be difficult to point to a single important invention or improvement, the introduction of which the world owes to a State railway."

Is it not a rather significant fact that with all their boasted advance in science and learning, the Germans have failed utterly in the two realms of politics, as shown in the preceding pages, and of railroading?

And these are the two most extensive fields of the influence of German Socialism.

The American citizen has before him in clear outline the sure result from a continuation of governmental ownership or control as a permanent policy in the United States after the war. As regards railroad personnel, if the positions from top to bottom were filled with Mr.

Bryan's "deserving Democrats," as was the case with our diplomatic and consular service in 1913, the results would be as striking, though perhaps in a different and even more serious way.

Of course the Civil Service, which has been a solid measure of reform and one from which we dare depart only at our peril, would probably be called into use and be evaded in exactly the same way as it has been in the past. And even if it were not evaded, we must remember that the Civil Service examinations and rules are not a guarantee of efficiency or excellence. The best that can be said for them is that they are a protection against absolute incompetence and, to a certain extent, against political spoiling. But in a positive sense, the Civil Service is merely a guarantee of mediocrity. And mediocrity never yet made a success of a great transportation or productive system such as our railroads or industrial corporations. The political possibilities of a "railroad vote" of several million employees of the government need only be referred to, to be feared.

Perhaps no one would suffer more from a policy of government ownership than the present force of railroad employees in the United States. They have won their present positions for the most part by individual achievement, but their future advancement would depend not upon the continued successful handling of their work, but upon either the injustice of political favoritism or the undiscriminating rules of the Civil Service. That some of the employees have not failed to grasp the political possibilities is shown by my own recent experience upon a train between Philadelphia and New York. I had a difference with one of the train crew who was collecting the tickets in my car, and which was caused by carelessness and indifference on his part. The employee finally answered my protests by remarking--"Oh well, we don't care so long as Woodrow Wilson is in the White House." The truth or untruth of this statement is not the important thing, but the fact that he made it.

The personnel would tend steadily to deteriorate in efficiency. The successful government employee is the one who follows most closely the beaten track of precedent and past experience. If he departs from this track, he inevitably arouses the opposition of his fellow-employees or of the unthinking part of the public, who usually desire no change. He also takes all the risks of experiment and if he succeeds, the rewards are uncertain and small; if he fails, he personally bears all the consequences. This is the reason for the tendency toward steady deterioration on the part of all public service. Employees of the State must follow the path of absolute conformity to the past. This deadens individual initiative, ambition and inventiveness.

At this point it would be well to repeat the penetrating question recently asked by Mr. Otto H. Kahn in the course of an address before the American Bankers a.s.sociation in Chicago. Said Mr. Kahn--"Now, you and I, who are trained in business, have all we can do to conduct our respective concerns and personal affairs with a fair measure of success.

On what grounds, then, can it be a.s.sumed that by becoming endowed with the dignity of a governmental appointment, men of average or even much more than average ability will develop the capacity to run successfully the huge and complex business undertakings which the devotees of paternalism would place in their charge?"

Furthermore, the plant and its upkeep would be subject to political influence and objects. Just as we have needlessly expensive or even useless post office buildings, harbor improvements and other works of national cost built as the result of sectional log-rolling of Congressional politicians, so probably we would have railroad stations, tracks, subway crossings, and service in general offered not from the standpoint of efficiency and public service, but as indirect campaign contributions to needy Congressional candidates for re-election.

It should be realized that the mistakes and delays in our shipping and airplane production during the first year of the war were probably not so much the fault of the government at Washington and the administration of affairs in these departments, as they were the inherent defects of the Government itself doing the work, and these effects were overcome only by the heroic efforts of Mr. Schwab, Mr. Ryan, and the other men whom President Wilson wisely chose to insure the success of these war measures as a patriotic necessity.

Our present postal service, the most necessary, next to the public schools, of all the means for the formation of community feeling and public opinion essential to a democracy, has been under the charge of deterioration and inadequate service for the past ten years. Also it must be remembered that the government-controlled systems of telegraph and telephone in the various European countries are unspeakably bad, according to the standards of service to which we have become accustomed through long years of efficient private management. Therefore, in the light of this experience the taking over of our systems by the government has its justification only as a war necessity. As a matter of permanent policy, it would be an entirely different and very serious matter. The marked deterioration that almost immediately appeared in the telegraph service, is sufficient proof of this fact.

FOOTNOTES:

[Footnote 9: Quoted from an editorial in the (daily) New York _Evening Call_, issue for August 29, 1918.]

[Footnote 10: "The advantages which might be derived from a single united administration of all the railroads are doubtless somewhat a.n.a.logous to those we derive from the post office, but in most other respects the a.n.a.logy fails completely and fatally. Railway traffic cannot be managed by pure routine like that of the mails. It is fluctuating and uncertain, depending upon the seasons of the year, the demands of the locality, or events of an accidental character. Incessant watchfulness, alacrity, and freedom from official routine are required on the part of a traffic manager, who shall always be ready to meet the public wants." W.S. Jevons (reprinted in _Selected Readings in Public Finance_, by C.J. Bullock, p. 103).]

V

THE TRUE ANTIDOTE FOUND IN CO-OPERATIVE EFFORT

There is one term, the use of which is anathema to the Socialist, and that term is "human nature." He never wishes to meet or discuss this in an argument, and with good reason, for it has been shown that it is only by ignoring human nature entirely, both in theory and in practice, that Socialism can make even the semblance of a reasonable showing. But another term, which the Socialist especially likes, is "co-operation,"

and that is one to which he has no manner of right. Cooperation is a social movement, the impulse for which comes from within the human heart, while Socialism as already stated, is essentially a working together only as the result of outward direction and dictation. The first is the act of a free man; the latter results from the obedience of a political and mental slave.

We Americans have made one of the greatest successes of history along the line of political co-operation. Our whole democratic type of government is based upon this principle as a foundation. But we have done little toward the free and successful use of co-operation in business or production. It is here that our British cousins have far exceeded us even though we have outdistanced them, we think, along political lines of activity.

It was shown in _The Journal of Commerce and Commercial Bulletin_ for January 25, 1918, that this co-operative movement in Great Britain has developed to such an extent that at the present time distributive societies there number some 3,500,000 members. The turnover of these societies last year amounted to $605,000,000, to which should be added $350,000,000 from the co-operative wholesale and the hundred distributive societies. As a contrast to this, the American people have been so filled with the individualism necessary to the spirit of the pioneers who in reality have been "subduing a continent" that they have failed to realize what a wonderful field for efficient, popular effort the commercial and industrial activities of the country offered if we only would adopt the principle of co-operative organization. Probably one of the greatest lines of development after the war will be this co-operation between producers and consumers. In no other way can those activities and profits of the middlemen, which are more or less unnecessary, be entirely eliminated.

I have it on good authority from members of the American Federation of Labor that fully 95 per cent of its membership is opposed to Socialism, and that the Socialistic 5 per cent is largely among the laboring men of the Pacific Coast, with possibly a few in the Middle West, especially Kansas. This latter is probably an after effect of the old "Populistic"

craze of the early 'nineties. On the other hand, American labor is feeling the need of cooperative action, not only as regards themselves, but also as regards capital as well, and Mr. Gompers has proved himself of the stature of real statesmanship in appreciating and advancing this idea in the most patriotic way since the war began. Individual laboring men with whom I have talked say they "like the working together" that Socialism advocates, but after explaining their position more fully, in nine cases out of ten it is found that they utterly repudiate the dictatorial, outwardly-directing theory upon which Socialism stands, and in reality desire the advance of this spirit of co-operation. Thus they look upon a bonus from profits as merely a partial gift on the part of corporate management. What they desire is profit-sharing, as standing for a recognition of the just right of labor to a larger part of the just proceeds of its work. Thus probably the greatest antidote and enemy of Socialism is profit-sharing, and after all it is only a recognition of the fact that production is the joint work of both capital and labor, that both are requisite and necessary, and that their whole success is based upon this spirit of co-operation.

There is no doubt that there are men to-day who are in official positions of power and influence in our national, state and city administrations throughout the United States and who are more or less openly using the present crisis of unusual and war conditions in order to precipitate the country into a complete Socialistic organization. It may be that we shall come to Socialism as a final political and economic development. Personally, I for one do not believe that we will, or that even a small part of the real thinking American people, either native or foreign born, would desire this. Even if we did enter upon such a policy it would only be temporary in duration, and be followed by a terrible struggle of readjustment to the old conditions. But if we do undertake Socialism, let us at least do it with our eyes open. Let us realize that we are entering upon an entirely new and untried policy which is diametrically opposed to all the ideas and ideals, the history, the fundamental thought and theory upon which this country was founded and has prospered and developed so marvellously up to the present time.

Those officials, no matter where placed as regards power and responsibility, who by underhand means would throw us into this entirely new method of life without due thought and consideration, are politically dishonest, no matter how sincere they may be, and are as traitorous to American life and thought as are the pro-German or the pacifist.

The reaction against measures of government ownership and control which have been made necessary by the exigencies of a great war crisis already has appeared in Great Britain. The English papers contain open criticism of the government operation of the railways, of shipbuilding and of production in general. The London _Times_ said editorially last year: "The railways are certainly short of labor, but is it established that all the officials are putting their very best efforts into the solution of the present problems? The railways are now Government controlled inst.i.tutions and compet.i.tion has diminished where it has not vanished.

It seems to be a question whether quite the same amount of thought and work is being put into the efficient management of the companies as in the days before the war when the lines were keenly competing against each other. This question which has been raised of a slackening of effort directly in consequence of the nationalization of the railways is a serious one and evidently deserves inquiry.... The public is ent.i.tled to know if the railways are now using what remains to them (of labor and capital) with the utmost efficiency." Also the best authorities, and even the government investigators themselves, are urging a speedy return to private ownership and operation at the earliest possible moment after the war. The same undercurrent of feeling, or rather conviction, is rapidly spreading among our own people in the United States.

Mr. Hoover has expressed this same view in the most emphatic terms in the course of an address to the special conference of Federal Food Administrators held in Washington, D.C. on November 12, 1918. "It is my belief," said Mr. Hoover, "that the tendency of all such legislation except in war is to an over degree to strike at the roots of individual initiative. We have secured its execution during the war as to the willing co-operation of 95 per cent of the trades of the country, but under peace conditions it would degenerate into an hara.s.sing blue law."

But the advocates of Socialism are especially active during the time of uncertainty and confusion that necessarily follows the close of a great world war. At such times, they always are. In the words of Mr.

Kahn,--"They possess the fervor of the prophet allied often to the plausibility and cunning of the demagogue. They have the enviable and persuasive c.o.c.ksureness which goes with lack of responsibility and of practical experience. They pour the vials of scorn and contempt upon those benighted ones who still tie their boat to the old moorings of the teachings of history and of common sense appraisal of human nature. And being vociferous and plausible they are unquestionably making converts."

Recently I saw little "stickers" pasted on the walls of a railway station in a small New Jersey city which read as follows--

The Masters Fear Slaves That Think If you think right you will act right Study Socialism

This is typical of the fallacious arguments so often encountered. First of all, it has the tone of darkest Hungary or Bolshevist Russia, and is absolutely contrary to the facts as regards conditions in the United States. The so-called "toasters" or "capitalistic cla.s.s;" for suppose it is to them that this refers, have been in the forefront of the movement to educate the ma.s.ses, and have given their time, money and sympathy to aid in its success. I heartily agree with the _non sequitur_ statement that "if you think right you will act right." I am perfectly willing to join in the demand that our people should "study Socialism," for if the American people will not only study it but also think their way through in regard to it, no sincere believer in democracy and in American ideals need have any doubt as to the final outcome.

We Americans believe that our people, in the long run, will decide right upon any question to which they have given due thought and consideration. So in their hands we may safely leave the whole question of Socialism and government ownership or operation. All we ask is, that they be given due knowledge and instruction. Furthermore, if Socialism be true, it should not fear open and complete examination. If the truth is the truth, it must prevail in the end. Therefore the surrept.i.tious and secret attempt to foist Socialism upon an unsuspecting people savors much of the lack of sincerity and of belief in its real truth on the part of its own advocates. At least they should stop making their appeal mainly to the uninstructed foreign-born and to the apostles of half-baked learning, and lay their case before the hard-headed laborer, the business and the professional man.