the social values given to land, or franchises, or other forms of property seems more equitable. The Supreme Court in recent decisions "has read into the constitution two sweeping exceptions to the inviolability of property rights."[245] One is that of public use.
"Whenever the owner of a property devotes it to a use in which the public has an interest, he in effect grants to the public an interest in such use, and must to the extent of that use submit to be controlled by the public for the common good so long as he maintains the use." The second exception is that of the police power which in 1906 (204 U. S., 311, 318) was declared to extend "to so dealing with the conditions which exist in the state as to bring out of them the greatest welfare of its people." The application of this broad principle is still in an uncertain condition, but there can be no question that it recognizes a changed situation. When people are living in such interdependence as in the collective life of to-day, it is no longer possible to locate public welfare in any such preponderating degree in private rights as was justified under the conditions of a new country a century ago. Says Professor Smith: "On the fundamental question of the relation of public policy to private property rights the [Supreme] Court has abandoned the individualist views with which the founders of the constitution were imbued; and in its doctrines of the public use and the police power it has distinctly accepted what may be termed, in the literal and proper sense of the word, the socialist view. In so doing, it has unquestionably expressed the dominant opinion of the American people. The American people does not accept the collectivist theory; it believes in private property; but it recognizes that rights of property must yield, in cases of conflict, to the superior rights of society at large."
If some of the means set forth above for securing juster distribution were adopted, the first step toward Mill's demand[246] would be met. If the community should reap the return for its own growth, if taxation should be so arranged as to fall most heavily on those best able to pay rather than on those who are most honest or least able to evade, it would seem rational to hold that society will find a way to continue the four forms of control now existing, making such shifts as changing conditions require.
Some of these shiftings are already evident and give promise of greater justice without loss of any of the benefits accruing from private property.
=Social Justice through Economic, Social, and Scientific Progress.=--Not all moral advance comes "with observation," or by political agency. The economic process is providing in certain lines a substitute for property. Science and invention, which are themselves a fine illustration of the balance and interaction between individual and social intelligence, individual effort and social coöperation, are making possible in many ways a state of society in which men have at once greater freedom and greater power through association, greater individual development and greater socialization of interests, less private property but greater private use and enjoyment of what is common.
The substitute for property provided by the economic process itself is permanence or security of support. If the person can count definitely upon a future, this is equivalent to the security of property. And through the organization of modern industry supplemented by insurance and pensions, either state, institutional, or in corporations, or in mutual benefit associations, there has been on the whole, a great increase of security, although it is still unfortunately true that the wage-worker may in most cases be dismissed at any moment, and has virtually no contract, or even any well-assured confidence of continued employment.
It is a mutual coöperation of economic, social, and scientific factors which has brought about a great increase of individual use and enjoyment through public ownership. This _has placed many of the things which make life worth living within the enjoyment of all_, and at the same time given a far better service to the users than the old method of private ownership. _In this change lies, perhaps, the greatest advance of justice_ in the economic sphere, and a great promise for the future.
There was a time when if a man would sit down on a piece of ground and enjoy a fine landscape, he must own it. If he would have a plot where his children might play, he must own it. If he would travel, he must carry his own lantern, and furnish his own protection from thieves. If he would have water, he must sink his own well. If he would send a letter, he must own or hire a messenger. If he would read a book, he must not merely own the book, but own or hire the author or copyist. If he would educate his children, he must own or hire the tutor. We have learned that public parks, public lighting and water works, public libraries, and public schools, are better than private provision.
The objection which comes from the individualist to this programme is that it does too much for the individual. It is better, urges individualism, to stimulate the individual's activity and leave his wants largely unsatisfied than to satisfy all his wants at the expense of his activity. But this assumes that what is done through public agencies is done for the people and not by the people. A democracy may do for itself what an aristocracy may not do for a dependent class. The greatest demoralization at the present time is not to those who have not, but to those who appropriate gains due to associated activity, complacently supposing that they have themselves created all that they enjoy.
=Another Great Advance is the Change in What Makes Up the Chief Values of Life.=--In early times the values of life were largely found in food, clothing, personal ornaments, bodily comfort, sex gratifications.
Enjoyment of these involved exclusive possession and therefore property.
But with the advance of civilization an increasing proportion of life's values falls in the mental realm of sharable goods.
Satisfaction in knowledge, in art, in association, in freedom, is not diminished, but increased when it is shared. The educated man may have no more property than the illiterate. He has access to a whole system of social values. He has freedom; he has a more genuinely independent type of power than accrues from the mere possession of things. The society of the future will find a part of its justice in so adjusting its economic system that all may enter as fully as possible into this more social world.
=Methods of Social Selection.=--Finally, recognizing all the value of the competitive process in the past as a method of selecting ability, it must be regarded as crude and wasteful. It is like the method of blind trial and error which obtains in the animal world. The method of ideas, of conscious use of means to secure ends, is the more effective and the more rational. Society now is gaining the scientific equipment which may allow the substitution of the more effective and less wasteful method.
It should discover and educate capacity instead of giving merely a precarious encouragement to certain special types.
§ 9. THREE SPECIAL PROBLEMS Three special problems may be noticed about which moral judgment is as yet uncertain: The open versus the closed shop, the capitalization of corporations, and the "unearned increment."
=1. The Open versus the Closed Shop.=--In certain industries in which the workmen are well organized they have made contracts with employers which provide that only union men shall be employed. Such a shop is called a closed shop, in distinction from an "open shop" in which non-union men may be employed in part or altogether. The psychological motive for the demand for the closed shop is natural enough: the union has succeeded in gaining certain advantages in hours or wages or both; this has required some expense and perhaps some risk. It is natural to feel that those who get the advantage should share the expense and effort, and failing this, should not be admitted to the shop. If the argument stopped here it would be insufficient for a moral justification for two reasons. First, joining a union involves much more than payment of dues. It means control by the union in ways which may interfere with obligations to family, or even to the social order. Hence, to exclude a fellow workman from the opportunity to work because he--perhaps for conscientious reasons--would not belong to the union, could not be justified unless the union could make it appear that it was maintaining a social and not merely a group interest. Second, in some cases unions have sought to limit output. In so far as this is done not for reasons of health but to raise prices, the union is opposing the interest of consumers. Here again the union must exhibit a social justification if it is to gain social approval.
On the other hand it may be noted that the individualist of the second sort--who believes in the competitive struggle as a moral process--has no ground on which to declare for "open shop." Exactly the same principle which would permit combination in capital and place no limit on competitive pressure, provided it is all done through free contracts, can raise no objection against combinations of laborers making the best contracts possible. When a syndicate of capitalists has made a highly favorable contract or successfully underwritten a large issue of stock, it is not customary under the principle of "open shop" to give a share in the contract to all who ask for it, or to let the whole public in "on the ground floor." Nor are capitalists accustomed to leave a part of the market to be supplied by some competitor for fear such competitor may suffer if he does not have business. When the capitalist argues for the open shop upon the ground of freedom and democracy, it seems like the case of the mote and the beam.
An analogy with a political problem may aid: Has a nation the right to exclude (or tax heavily) goods or persons from other countries? May it maintain a "closed shop"? The policy of the American colonists and of the United States has varied. The Puritans maintained a "closed shop" on religious lines. They came to this country to maintain a certain religion and polity. They expelled several men who did not agree with them. The United States excludes Chinese laborers, and imposes a tariff which in many cases is intended to be prohibitive against the products of other countries. This is done avowedly to protect the laborer, and in so far as it is effective it closes the shop. The maxim "This is a white man's country" is a similar "closed shop" utterance. On moral grounds the non-union man is in the same category as the man of alien race or country. What, if anything, can justify a nation or smaller group from excluding others from its benefits? Clearly the only conditions are (1) that the group or nation is existing for some morally justifiable end, which (2) would be endangered by the admission of the outsiders. A colony established to work out religious or political liberty would be justified in excluding a multitude who sought to enter it and then subvert these principles. If a union is working for a morally valuable end, e.g., a certain standard of living which is morally desirable, and if this were threatened by the admission of non-union men, the closed shop would seem to be justified. If the purpose were merely to secure certain advantages to a small group, and if the open shop would not lower the standard but merely extend its range of benefits, it is hard to see why the closed shop is not a selfish principle--though no more selfish than the grounds on which the tariff is usually advocated.
=2. The Capitalization of Corporations=, especially of public service corporations, is a matter on which there is a difference of policy in different states, owing probably to uncertainty as to the morality of the principles involved. The two theories held are: (a) Companies should issue capital stock only on the basis of money paid in; dividends then represent a return on actual investment. (b) Companies may issue whatever stock they please, or whatever they expect their income will enable them to pay dividends upon; dividends will then represent return for valuable privileges, or for some utility to be marketed. In behalf of this latter view it may be claimed that if the company pays dividends the investors have nothing to complain of, and if it sells its products or transportation at market rates, the consumer has nothing to complain of.
So far as the relations between corporation and investor are concerned, the issues are simple. If the stocks are issued with no expectation that they will give any return, merely to "sell," it is pure dishonesty, of the same type which under cruder conditions sold spavined horses or made counterfeit money, and now assumes the more vulgar type of dealing in "green goods." The fact that fictitious capital can be publicly advertised, gives it a financial but not a moral advantage. This, however, would have such decided limitations, credulous as human nature is, that if fictitious capital paid no dividends it would soon have no market. Hence, for the far-seeing promoter, the pressure is toward making some at least of the fictitious capital pay dividends. What is the principle in this case? If we are dealing with a new and untried mode of production or public service, the case is simply that of any speculation. If a proposed product has a possible utility, but at the same time involves so much risk that in the long run only half of such enterprises will succeed, society may consider it worth offering a profit equal to fifty per cent. in order to pay for the risk. If, on the other hand, the income is to derive from valuable public franchises, or from the growth of the community and its necessities, the case is different. Here there is little, if any, risk for which it is fair for society to pay. The excessive capital beyond the cost is designed to disguise the rate of profit, and therefore conceal from the community the cost of the goods or service. If the public demands cheaper rates it is told that the company is now paying only a fair dividend upon its stock.[247] The usual method of capitalizing many enterprises of a quasi-public sort is to issue bonds to cover the cost of construction or plant, and then one or more series of stocks which are known as "velvet." In part these stocks may represent a work of organization which is a legitimate public service, but in many cases they represent devices for transferring public wealth to private property. Enormous sums have been taken from the public in this manner. The element which makes this method particularly obnoxious is that the quasi-public corporations are given a monopoly by the community and then take advantage of this to capitalize indefinitely the necessities of a growing community. In this case the conception of public service is lost sight of in the "dazzling possibility of public exploitation."[248] Few methods of extorting wealth have equaled this. In some cases bribery of public officials has added an item of expense to be collected later from the public. When the various forms of public service or protected industry were first projected there was risk involved. It was necessary to offer inducements to capital to engage in them. It was desirable to have railroads, gas, water, express service. But as the factor of risk has been eliminated, the public tires of paying double prices, and a "fair" return must be estimated on the basis of actual rather than fictitious capital. The public has come to have a clear idea as to the morality of such practices as have been employed in letting contracts for public buildings at prices far above market value. The New York City courthouse and Pennsylvania capitol offer familiar examples. Does it differ materially from such practices when a company charges the public an excessive price for transportation or lighting, and when State or municipal authorities authorize by franchise or monopoly such excessive charges? Probably the conscience of the next century, if not of the next generation, will fail to see the superior moral quality of the latter procedure.
=3. The "Unearned Increment."=--This term is applied most frequently to the increase in land value or franchise value which is due, not to the owner, but to the growth of the community. A tract of land is bought at a price fixed by its value as farm land. A city grows up. The owner of the land may have been active in the building up of industry, but he may not. An increase of values follows, which is due to the growth of the community. Shall the owner have it all, or shall the community have it all, or shall there be a division? The growth in value of a franchise for gas, electric lighting, transportation, presents the same problem.
It is not usually recognized, however, that the same principle is found in every increase of value due to increasing demand. The logical basis for distinction would seem to be that in some cases increase of demand calls out competition, and the price is lowered; the public thus receives its share in lower cost. In other cases, notably those first mentioned, there can be no competition, the price is therefore not often lowered unless by legislative action, and the whole benefit goes to the owner of land or franchise. As regards land, the case is much stronger in Europe, for land titles were originally gained there largely by seizure, whereas in America private titles have been largely through purchase.
Individualism, according as it argues from the platform of natural rights or from that of social welfare, would claim either that individuals should have all the increase because they have a right to all they can get under a system of free contracts, or that it is for the social welfare to allow them all they can get since private property is public wealth. From the standpoint of natural rights the reply would seem to be unanswerable: the community gives the increased value; it belongs to the community. From the standpoint of social welfare the answer is not so simple. It might, for example, be socially desirable to encourage the owners of farming land by leaving to them the increase in value due to the growth of the country, whereas city land-owners might need no such inducement. Investors in a new form of public service corporation might need greater inducements than would be fair to those in enterprises well established. But, although details are complex, the social conscience is working toward this general principle: the community should share in the values which it produces. If it cannot do this by cheaper goods and better service, it must by graded taxation, by ownership, or by some other means. The British government has already considered a measure for ascertaining the land values in Scotland as a preliminary step toward adjustment of this question.
FOOTNOTES: [240] Boston has an ingenious method of dividing profits. The company which supplies gas must lower the price of gas in proportion as it increases its rate of dividends.
[245] I have followed in this paragraph the discussion of Professor Munroe Smith, _Van Norden's Magazine_, February, 1908. For a full history see E. Freund, _The Police Power_, 1905.
[247] As in the case of gas in New York City, where the court has decided that the public cannot refuse to pay interest on the value of the franchise--its own gift.
APPENDIX TO CHAPTER XXV PROFESSOR SEAGER'S PROGRAMME OF SOCIAL LEGISLATION WITH SPECIAL REFERENCE TO WAGE-EARNERS In the conviction that in the field of social legislation the United States is behind the more progressive countries of Europe, Professor Henry R. Seager, of Columbia University, presented the following _Outline_ for discussion at a meeting of the American Association for Labor Legislation, December 30, 1907. It is reproduced with his consent as giving concrete expression to several of the principles advocated in the foregoing chapters.
The ends to be aimed at in any programme of social legislation are: I. To protect wage-earners in the continued enjoyment of standards of living to which they are already accustomed.
II. To assist them to attain to higher standards of living.
_I. Measures to protect prevailing standards of living._ The principal contingencies which threaten standards of living already acquired are: (1) industrial accidents; (2) illness; (3) invalidity and old age; (4) premature death; (5) unemployment.
These contingencies are not in practice adequately provided against by wage-earners themselves. In consequence the losses they entail, in the absence of any social provision against them, fall with crushing force on the families which suffer from them, and only too often reduce such families from a position of independence and self-respect to one of humiliating and efficiency-destroying social dependency. The following remedies for the evils resulting from this situation are suggested.
(1) Employers' liability laws fail to provide adequate indemnity to the victims of industrial accidents because in a large proportion of cases no legal blame attaches to the employer and because litigation under them is costly and uncertain in its outcome. Adequate indemnification must be sought along the line of workmen's compensation for all industrial accidents at the expense of the employer (the British system) or of compulsory accident insurance (the German system). The former seems to accord better with American ideas and traditions.
(2) The principle of workmen's compensation may be extended to include indemnity for loss of wages due to trade diseases.
Provision against illness not directly traceable to the employment must be sought either in compulsory illness insurance or in subsidized and state-directed sick-insurance clubs. Trade unions may assume the functions of such clubs in organized trades. The latter plan seems better suited to present American conditions than compulsory illness insurance.
(3) Provision against invalidity and old age may be through compulsory old age insurance, or through state old age pensions.
The latter, though more costly, are believed to be better suited to American conditions, when hedged about by proper restrictions, than compulsory old age insurance with the elaborate administrative machinery which it entails.
(4) Premature death may be provided against by an extension of the machinery for caring for the victims of industrial accident and of illness to provide for their families when accident or illness results fatally.
(5) Provision against losses due to unemployment is attended with great difficulties because unemployment is so frequently the consequence of incapacity or of disinclination for continuous labor. The most promising plan for providing against this evil appears to be through subsidizing and supervising trade unions which pay out-of-work benefits to stimulate this side of their activity. Public employment bureaus and industrial colonies for the unemployed may also help to alleviate the evil of unemployment.
* * * * * Adequate social provision against these five contingencies along the lines suggested, would, it is believed, go a long way towards solving the problem of social dependency. If these concessions were made to the demands of social justice, a more drastic policy towards social dependents than public opinion will now sanction might be inaugurated with good prospect of confining social dependency to the physically, mentally, and morally defective.
_II. Measures to elevate standards of living._ The primary conditions essential to rising standards of living are energy and enterprise on the part of wage-earners and opportunities to make energy and enterprise count in the form of higher earnings. The principal contributions which social legislation may make to advancing standards of living in the United States are believed to be: (1) measures serving to encourage saving for future needs on the part of wage-earners by providing safe investments for savings; (2) measures protecting wage-earners from the debilitating effects of an unregulated competition; (3) measures serving to bring within the reach of all opportunities for industrial training. Standards of living will also be advanced, of course, by nearly all measures calculated to promote the general well-being, such as tax and tariff-reform legislation, laws safeguarding the national domain, the public regulation of corporations, especially those with monopolistic powers, etc., but these are not usually classed under the head of social legislation.
(1) The greatest present need under this head is for a postal savings bank like those of European countries. The advantages of a postal savings bank over privately managed banks are the wider distribution of places of deposit, post-offices being located in every section of the country, and the greater confidence depositors would feel in such a bank. Once established the postal savings bank might enter the insurance field, as has the British postal savings bank, not as a rival of privately managed insurance companies, but to bring to every wage-earner the opportunity to secure safe insurance. Next to providing itself opportunities for safe investment and insurance, the government has an important duty to perform in supervising the business of privately managed savings banks and insurance companies. Notwithstanding the progress made in recent years in the United States in this field, there is still something left for social legislation to accomplish.
(2) If energy and enterprise are to be kept at a maximum, wage-earners must be protected from exhausting toil under unhealthful conditions. Skilled wage-earners can usually protect themselves through trade unions, but unskilled workers, women and children, require legal protection. Under this head belong, therefore, the familiar types of protective labor laws. The following may be specified: (a) Laws prohibiting the employment of children below fourteen in all gainful pursuits. Such laws should be uniform throughout the United States and rigidly enforced by means of employment certificates based on convincing evidence of age and physical examination to determine fitness. As provision for free public education is made more adequate to present needs the minimum age may be advanced perhaps to sixteen.
(b) Laws limiting the hours of labor of young persons over fourteen. Protection here should extend to eighteen, at least in factory employments, and employment certificates should be required of all under that age.
(c) Laws limiting the hours of labor of women. In the regulation of women's work in the United States the principal needs are uniformity and machinery for efficient enforcement. The last is facilitated by the plan of specifying in the law the working period for the protected classes, and American courts must be brought to see the reasonableness (administratively) of such prescriptions. The nine-hour day and prohibition of night work set a high enough standard until greater uniformity and more efficient enforcement shall have been secured.
(d) Prescriptions in regard to sanitation and safety appliances.
General prescriptions in regard to ventilation, etc., need to be made more exact, and much more attention needs to be given to the special regulation of dangerous trades, the existence of which has been largely ignored thus far in American legislation.
(3) The chief reason for restricting the labor of children and young persons is to permit the physical and mental development of childhood and youth to proceed unhampered and to ripen into strong, vigorous, and efficient manhood and womanhood. To attain this end, it is necessary to provide not only for wholesome living conditions and general free public education, but also for special industrial training for older children superior to the training afforded in modern factories and workshops. The apprenticeship system now fails as a method of industrial training, even in those few trades which retain the forms of apprenticeship. There is urgent social need for comprehensive provision for industrial training as a part of the public school system, not to take the place of the training now given to children under fourteen, but to hold those between fourteen and sixteen in school. As this need is supplied the period of compulsory school attendance may gradually be extended up to the sixteenth year. The guiding principle of such industrial training should be that it is the function of free public education in the United States not only to prepare children to lead useful, well-rounded and happy lives, but to command the earnings without which such lives are impossible.
The above programme of social legislation is urged as a step towards realizing that canon of social justice which demands for all equal industrial opportunities. It is believed that it will also help to raise the standard of citizenship in the country by making both wage-earners and employers more intelligent, more efficient, and more truly democratic. Thus it will serve to prepare the way for such further industrial reorganization as may be found desirable.
CHAPTER XXVI THE FAMILY The family in its moral aspects has one end, the common good of all its members, but this has three aspects. (1) Marriage converts an attachment between man and woman, either of passion or of friendship, into a deliberate, intimate, permanent, responsible union for a common end of mutual good. It is this common end, a good of a higher, broader, fuller sort than either could attain in isolation, which lifts passion from the impulsive or selfish to the moral plane; it is the peculiar intimacy and the peculiar demands for common sympathy and co-operation, which give it greater depth and reach than ordinary friendship. (2) The family is the great social agency for the care and training of the race. (3) This function reacts upon the character of the parents. Tenderness, sympathy, self-sacrifice, steadiness of purpose, responsibility, and activity, are all demanded and usually evoked by the children. A brief sketch of the development of the family and of its psychological basis, will prepare the way for a consideration of its present problems.
§ 1. HISTORICAL ANTECEDENTS OF THE MODERN FAMILY The division of the sexes appeals to the biologist as an agency for securing greater variability, and so greater possibility of adaptation and progress. It has also to the sociologist the value of giving greater variety in function, and so a much richer society than could exist without it. Morally, the realization of these values, and the further effects upon character noted above, depend greatly upon the terms under which the marriage union is formed and maintained. The number of parties to the union, the mode of forming it, its stability, and the relations of husband and wife, parents and children, while in the family relation, have shown in western civilization a tendency toward certain lines of progress, although the movement has been irregular and has been interrupted by certain halts or even reversions.
=The Maternal Type.=--The early family, certainly in many parts of the world, was formed when a man left his father and mother to "cleave unto his wife," that is, when the woman remained in her own group and the man came from his group to live with her. This tended to give the woman continued protection--and also continued control--by her own relatives, and made the children belong to the mother's clan. As recent ethnologists seem inclined to agree, this does not mean a matriarchal family. The woman's father and brothers, rather than the woman, are in the last analysis the authority. At the same time, at a stage when physical force is so large a factor, this type of family undoubtedly favors the woman's condition as compared with the next to be mentioned.
=The Paternal Type.=--When the woman leaves her own group to live in the house of her husband, it means a possible loss of backing and position for her. But it means a great gain for the influence which insures the wife's fidelity, the father's authority over the children and interest in them, and finally the permanence of the family. The power of the husband and father reached its extreme among western peoples in the patriarchate at Rome, which allowed him the right of life and death. At its best the patriarchal type of family fostered the dignity and power of a ruler and owner, the sense of honor which watched jealously over self and wife and children to keep the name unsullied; finally the respective attitudes of protector and protected enhanced the charm of each for the other. At its worst it meant domineering brutality, and either the weakness of abject submission or the misery of hopeless injustice.
Along with this building up of "father right" came variations in the mode of gaining a wife. When the man takes a wife instead of going to his wife, he may either capture her, or purchase her, or serve for her.
In any of these cases she may become to a certain extent his property as well as his wife. This does not necessarily imply a feeling of humiliation. The Kafir women profess great contempt for a system in which a woman is not worth buying. But it evidently favors a commercial theory of the whole relation. The bride's consent may sometimes be a necessary part of the transaction, but it is not always.
=Effects of Father Right.=--This family of "father right" is also likely to encourage a theory that the man should have greater freedom in marriage than the woman. In the lowest types of civilization we often find the marital relations very loose from our point of view, although, as was noted in Chapter II., these peoples usually make up for this in the rigidity of the rules as to who may marry or have marriage relations. With some advance in civilization and with the father right, we are very apt to find polygamy permitted to chiefs or those who can afford it, even though the average man may have but one wife. In certain cases the wives may be an economic advantage rather than a burden. It