CHAPTER XVIIToC

[618]John Burns and the Unemployed, p. 1.

[619]Independent Labour Party,A Statement of Principles, p. 3.

[620]Davidson,The New Book of Kings, p. 7.

[621]Blatchford,Britain for the British, p. 151.

[622]Casey,Who are the Bloodsuckers?p. 16.

[623]Bax,Outlooks from the New Standpoint, p. 70.

[624]Councillor Glyde,Liberal and Tory Hypocrisy, p. 12.

[625]Fabian Essays in Socialism, pp. 39, 40.

[626]Penny,The Political Labour Movement, p. 2.

[627]Quelch,Economics of Labour, pp. 9, 10.

[628]Leatham,The Evolution of the Fourth Estate, p. 11.

[629]Should the Working-class Support the Liberal Party?p. 10.

[630]Ibid.p. 19.

[631]Diack,Socialism and Current Politics, p. 10.

[632]Should the Working-class Support the Liberal Party?p. 19.

[633]Clarion, February 16, 1906.

[634]Penny,The Political Labour Movement, p. 2.

[635]Should the Working-class Support the Liberal Party?p. 13.

[636]Twentieth Century Politics, p. 4.

[637]Russell Williams,The Difficulties of Socialism, pp. 3, 4.

[638]Twentieth Century Politics, p. 6.

[639]Penny,The Political Labour Movement, p. 4.

[640]Twentieth Century Politics, p. 2.

[641]Penny,The Political Labour Movement, p. 3.

[642]Bax,Outlooks from the New Standpoint, pp. 69, 70.

[643]New Age, October 10, 1907.

[644]Daily News, January 20, 1906.

[645]The Reformers' Year Book, 1906, Preface p. 6.

[646]Ibid.1907, p. 104.

[647]Ibid.Preface.

[648]Clarion, November 1, 1907.

[649]Leatham,The Evolution of the Fourth Estate, p. 14.

[650]Penny,The Political Labour Movement, p. 13.

[651]Socialism and Labour Policy, p. 14.

[652]New Age, November 7, 1907.

[653]Ibid.

[654]Clarion, January 19, 1906.

[655]Marx and Engels,Manifesto, p. 22.

[656]Declaration of Socialist Party of Great Britain, see Appendix.

[657]Leatham,The Evolution of the Fourth Estate, p. 16.

[658]Declaration of Principles of Socialist Party of Great Britain.

[659]Keir Hardie,From Serfdom to Socialism, p. 30.

[660]Marx and Engels,Manifesto of the Communist Party, p. 16.

[661]Blatchford,Britain for the British, pp. 148, 149.

[662]Social-Democratic Federation Song Book, p. 30.

[663]Clarion Song Book, p. 21.

[664]Socialism and Labour Policy, p. 3.

[665]What Socialism Is, p. 3.

[666]Leakey,Co-operators and Labour Platform, p. 16.

[667]Shaw,The Impossibilities of Anarchism, p. 26.

Many Socialists, especially the Fabians, hope to introduce Socialistic principles and Socialistic rule into Great Britain rather through the local than through the national authorities. They are strenuously exerting themselves to bring about that result, and so far their exertions have been by no means unsuccessful.

"Socialists to-day are working in the towns with a twofold object. (1) To level up their districts. If Glasgow has municipal telephones, there is a very good precedent for Liverpool, Manchester, Bradford, Leeds, &c., doing likewise. If Liverpool owns a municipal milk-supply, London, Manchester, Bradford, Leeds, must be brought into line. Each town must adopt the good points from every other town. (2) To urge their districts to launch out into something new."[668]"The property held and worked and controlled by municipalities already exceeds 500,000,000l.sterling in value, and is being added to yearly. This process has but to continue long enough to ensure that every industry will pass under public control, and thus State Socialism will become an accomplished fact by a gradual process of easy transition."[669]

"The proper sphere of municipal activity includes everything a municipality can do better than a private company."[670]"The immediate object should be tomunicipalise all those services which are necessary to a healthy life. Food, fuel, clothing, shelter—these are required by all—and no man should have the right to deny them to any worker. We must not stop at municipal trams. We must not stop at municipal gas. We must not stop at municipal electricity. These are only stepping-stones. Not until we can say that poverty and disease and unemployment are abolished out of the land shall we have the right to discuss the limits of municipal trading."[671]"The economic forces which replaced the workshop by the factory will replace the private shop by the municipal store, and the private factory by the municipal one."[672]

According to Socialist teaching the destruction of private enterprise by municipal undertakings will be a blessing to all citizens. "Where a city supplies its own gas there is no 'middle-man.' The corporation stands in the place of the 'middle-man,' and as the corporation is elected by the citizens the people are thus in the position of getting their own gas made and paying for it in their own way. Some of the citizens are makers of gas, or workmen; most of the citizens are users of gas, or consumers; and all of the citizens are owners and managers of the gasworks and of the gas supply."[673]

The suppression of the "unnecessary middleman" sounds so very plausible that it is certain to prove an excellent election cry. But has the middleman really disappeared when a city corporation takes his place? Does the corporation-middleman supply gas gratis? Are the private middleman's profits not distributed to a host of corporation officials in the shape of substantial salaries? The transfer of gasworks, &c., from private hands to a city corporation is no doubt very beneficialto those who draw the corporation salaries. It may be very profitable to the local politicians and their hangers-on. Jobs may be had as a reward for political support. But the citizens may find the gas to be no cheaper and the rates to be considerably higher after the suppression of the "unnecessary middleman." And will it then console him that he is the "owner and manager of the gasworks and of the gas supply"?

Under the heading "The Justice of Abolishing the Private Trader" one of the leading champions of municipal Socialism writes: "Is it unfair to take away the living of the private trader? Then it is unfair to take away the living of the unemployed, the twelve millions on the verge of starvation, and the thousands slain annually by poverty and preventable disease. I say that the welfare of the nation must be considered before the profits of the monopolists and the wasteful freedom of the small trader. Under the present system a large proportion of the population have so deteriorated in health and stamina as to endanger the existence of the nation. Private enterprise and competition are responsible for nine-tenths of the misery and suffering of our twenty million poor. But we must not attempt to alter the conditions because the small private trader would be ruined. Nevertheless the system is going to be altered, whether the small trader likes it or not."[674]

The foregoing are typical Socialist arguments. In the first place, the writer grossly exaggerates existing poverty by speaking of "twenty million poor." Then he boldly asserts that all poverty is due to private enterprise and that municipal enterprise will abolish it. So far municipal enterprise has not even succeeded in diminishing poverty. On the contrary, with the phenomenal growth of municipal enterprise in Great Britain pauperism, actual and percentual, has also grown at an alarmingrate. It is significant that poverty and distress have increased most rapidly, and have become most acute, in those localities in which municipal enterprise has been most active and in which Socialist councils have held undisputed sway, as, for instance, in East and West Ham and Poplar. Municipal enterprise, by increasing the rates—and, with the rates, the rents—has increased the general cost of living without at the same time increasing production. On the contrary, it has driven factories away through high rates. Therefore municipal enterprise has increased the expenditure of the general body of workers without increasing their earnings, and consequently has directly increased the existing poverty which it has promised to abolish. Municipal enterprise has succeeded chiefly in giving from the rates high wages to municipal employees at the cost of all other workers.

Municipal Socialists rather rely on force than on justice in dealing with private business men. "For private traders to fight against municipalisation is a short-sighted policy. One thing is certain—they have to go. 'What! Compete with us with the ratepayers' money? Our own money? What injustice!' says the small trader."[675]This just objection of the ratepayers is answered with a contemptible quibble. "The small trader is mistaken. The municipality does not use their money, and would not use their money, under the supposed circumstances. If the London County Council decided to open 1,000 bread-shops, how would they raise the capital required? Not by taking the ratepayers' money, or the private traders' money, but by going into the money market and borrowing on the credit of all the citizens. Suppose 100,000l.were required? Not a penny would come out of the rates. The credit of all the citizens of London is so good that they can borrowall the money they want without any difficulty."[676]In other words, the Social-"Democratic" politician claims for himself the right of arbitrarily depriving citizens who possess property of that property and to ruin them by underselling them. They borrow the money they require for these undertakings on the credit of the very property-owners whom they wish to ruin, not on the credit of "all the citizens," as Mr. Suthers pretends, and then they have the impudence to assert that the corporations do not ruin the citizens with their own money but only with money borrowed on their credit—as if the one were not identical with the other.

The objections to municipal enterprise on a Socialist basis are twofold:

(1) That it increases the rates and the municipal debt, and therefore the rent of houses and lodgings;

(2) That it is, on the whole, unprofitable, being undertaken without due regard to sound finance, efficiency, and economy.

Socialists intend to "tax the rich out of existence." Therefore they endeavour to increase as much as possible not only the Imperial taxation but also the rates. Owners of house property are used to a certain income. If the rates are put up, they put up the rent. Therefore every increase in the rates leads, as a rule, automatically to an equivalent increase in the rent. The fact that a rise in the rates leads to a rise in the rent of houses and lodgings, and that the Socialist policy of waste and squander falls therefore most heavily not on the capitalist but on the working man, is boldly denied. "Generally speaking, the reduction of rates is of no benefit whatever to the working class. Rates are levied upon property.—Q.Do not the working class pay the rates and taxes?A.No. Rates and taxes are paid out of the surplus value taken from the workers bytheir exploiters. As already explained, the return to the workers, their wages, is determined by their cost of subsistence, regulated by competition in the labour market; consequently they have nothing wherewith to pay taxes, and whether these be high or low, or whoever has to pay them directly, the position of the worker remains the same. He gets, on the average, his subsistence, that is all."[677]

Unfortunately, many working men know to their cost that the arguments given above are absolutely untrue. Whilst their wages have remained stationary, their expenditure for rent has greatly increased owing to municipal enterprise carried on by Socialists regardless of expense, which has greatly increased rates. At West Ham "Local government was to be carried on in a way regardless of expense, and under the compounding system the vast majority of the electors were not to realise that there were such things as rates at all. One member of the Socialist party publicly declared that it did not matter to the working men of the borough how high the rates were. But the 'people' got to see in course of time that there were drawbacks, even for them, in unrestricted Socialism. They found that, because of the increased rates, house rents were going up twelve and a half to twenty per cent., notwithstanding the threats of the Socialists that every landlord who raised his rents should have his assessments increased."[678]

Owing to municipal enterprise directed by Socialists, "The sum-total of the rates, which stood at 6s.in the pound in 1890 and at 8s.1d.in 1896, rose to 8s.10-1/2d.in the pound in 1900 and 9s.5-1/2d.in the pound in 1901. From that figure it advanced to 9s.8d.in the pound,"[679]and to 10s.8d.a little later. It is an impudent misstatement of fact when Socialist leaders tell the workers, "Weare not killed by rates, we are killed by rent."[680]"The whole of our municipal expenditure is only a paltry 110 millions a year. What do we pay in rent? Two hundred and seventy-five millions!"[681]After all, people in other countries, where the blessings of Socialist local government are unknown, and where poverty is much rarer than in Great Britain, also pay rent. On an average the rates are 150 per cent. higher in Great Britain than in Germany.[682]

Whilst the national Government endeavours to diminish the dead weight and the heavy yearly charge of national indebtedness, Socialist local authorities vie with each other in piling up local indebtedness as fast as possible with a reckless disregard of the future. The increase of the municipal debt, the increase of local taxation, like the increase of national taxation, has no terrors for Socialists. On the contrary, "Municipal debt is not a burden. It is a splendid investment. We 'owe' 370 millions. Do we 'own' nothing? The municipalities own all the roads, drains, sewers, public buildings, parks, libraries, a thousand waterworks, two hundred and sixty gasworks, three hundred and thirty-four electricity undertakings, one hundred and sixty-two tramways, two or three hundred markets, a hundred and fifty cemeteries, forty-three harbours, piers, and docks, numerous baths, washhouses, and working-class dwellings, thousands of schools, and thousands of acres of land."[683]Since these words were written local indebtedness has increased. "We owe" now 470 millions.

Unfortunately, many of the splendid assets enumerated possess no realisable value whatever, and many municipal enterprises are run without an adequate profit or with a loss.

The Socialist views and aims regarding local indebtedness are well summed up as follows by Suthers: "The 'municipal debt' argument is a bogey. The greater the municipal debt, the less private enterprise there will be. The greater the municipal debt, the cheaper and better the public services will be. The less private capital, the less profits going into a few pockets, the richer the general public will be. Up, then, with municipal debt."[684]These are principles which threaten to make Great Britain bankrupt. "The annual report of the work of the Local Government Board for 1907 shows that the local debt of England and Wales, from being 17 per cent. of the National Debt in 1879-80, has grown to 58.5 per cent. of the National Debt in 1904-5. The National and Local debts have grown as follows:

1879-801904-5IncreaseNational Debt£770,604,774£796,736,491£26,131,717Local Debt136,934,070466,459,269329,525,199"[685]

Unless the Imperial Government interferes, the local debt will soon be larger than the National Debt.

We have seen in the beginning of this Chapter that, as regards local government, the Socialists pursue a twofold aim: (1) To level up their districts; (2) To urge their districts to launch out into something new. Therefore we find, as Mr. John A. Fairlie says in his book on "Municipal Administration," that "the danger of excessive debt is most serious in the smallest cities. The largest cities, while they have the largest debts, have also the largest resources, and also the best-developed financial administration. The cities of modest size, however, which attempt to equal the works of the metropolis without its available sources of revenue, are very likely to find themselves in serious difficulties."

The time may come, and it may come soon, whenBritish local indebtedness will become greatly reduced by local bankruptcy and repudiation. That process would have no terrors for Socialists. They ought rather to look forward to it. As they demand the repudiation of the National Debt (see Chapter IX.), they should logically also strive to repudiate the local debt. A general repudiation of local debt would be the fitting and logical aim and end of municipal enterprise. Municipal enterprise aims at expropriating private property-owners, who, rightly considered, are paid not in cash but in debt certificates. The repudiation of all local debts would convey gratis to the municipality the municipally managed undertakings which, rightly considered, belong to the stockholders, and would at the same time ruin the capitalists who have advanced the money for acquiring those undertakings. The Socialist policy would triumph. This would be the fitting end of a rule by irresponsible and penniless demagogues.

To the Socialist there is no limit to municipal enterprise. Not some branches of private trade and production, but all private trade and production are to be taken over by the municipalities. Private enterprise is to be extinguished altogether. The municipalities are to be universal owners, manufacturers, and providers. Among the first things which Socialist municipalities wish to control are the supply of bread, milk, coal; hospitals and public-houses, banks, fire insurances, and pawnshops.[686]

All workers are to be municipal officials. Stretching out beyond their borders, the municipalities are ultimately to absorb the country, and to bring it under Socialist management and government.[687]

Some of the more immediate aims of Socialism as regards London are expressed by Sydney Webb, the brilliant, but unfortunately somewhat over-imaginative, leader of British scientific Socialism, as follows:

"We see in imagination the County Council's aqueducts supplying London with pure soft water from a Welsh lake; the County Council's mains furnishing, without special charge, a constant supply up to the top of every house: the County Council's hydrants and standpipes yielding abundant cleansing fluid from the Thames to every street. When every parish has its public baths and washhouses open without fees, every Board school its swimming-bath and teacher of swimming, every railway station and public building its drinking-fountain and basin for washing the hands, every park its bathing and skating ponds—then we shall begin to show the world that we do not, after all, fall behind Imperial Rome in this one item of its splendid magnificence. By that time the landlord will be required, as a mere condition of sanitary fitness, to lay on water to every floor, if not to every tenement, and the bath will be as common an adjunct of the workman's home as it now is of the modern villa residence. And just as in some American cities hot water and superheated steam are supplied in pipes for warming purposes over large areas, we may even see the County Council laying on a separate service of hot water to be drawn at will from a tap in each tenement. Why should London's million families waste their million fires every time hot water is needed?

"The economy of fuel leads, indeed, to the municipalised gas-supply, then laid on, as a matter of course, to every tenement, and used, not only for lighting, but still more largely for cooking in the stoves supplied at a nominal charge.

"In order to relieve the pressure of population in the centre, and reduce the rents of the metropolitan"Connaughts," the County Council tramways will doubtless be made as free as its roads and bridges. Taxes on locomotion are universally condemned, and the economic effects of a penny tram-fare are precisely the same as those of a tax on the trip. The County Council will, however, free its trams on the empirical grounds of economy and the development of its suburban estates of artisans' dwellings, built on land bought to retain the unearned increment for the public benefit. Free trams may well imply free trains in the metropolitan and suburban area. Does not the Council already run a free service of steamboats on the Thames at North Woolwich—eventually, no doubt, to be extended all along the stream?

"Public libraries and reading-rooms in every ward are nearly here already, but we may expect that the library and the public hall will go far to cut out the tavern (at present our only 'public' house) as the poor man's club. As for bands of music in the parks, municipal fêtes, and fireworks on 'Labour Day,' and other instances of the communalisation of the means of 'enjoyment,' all this is already common form in France. The parks, indeed, will be tremendous affairs. But when London's gas and water and markets are owned and controlled by its public authorities; when its tramways, and perhaps its local railways, are managed like its roads and parks, not for private profit, but for public use; when the metropolis at length possesses its own river, and its own docks; when its site is secure from individual tyranny, and its artisans' dwellings from the whims of philanthropy; when, in short, London collectively really takes its own life into its own hands, a vast army of London's citizens will be directly enrolled in London's service."[688]

The foregoing political and economic programme would be more creditable to an imaginative schoolgirl ten years old than to a man of science and a politician. Howare all these wonderful and almost miraculous changes to be financed? Quite simply and very easily—by plunder. Mr. Sidney Webb, like most "scientific" Socialists, is a loose and shallow thinker. He forgets in his calculations that stubborn little item—human nature. He forgets that nobody can become richer by transferring money from the right pocket to the left. If you plunder all capitalists and all middlemen, the workers will certainly not be better off. Owing to the absence of direct self-interest, the management by salaried officials will be inefficient. All experience of management by public bodies through officials shows that public enterprise is far more wasteful and far less efficient than private enterprise; that in official management routine, sloth, waste, irresponsibility, nepotism, favouritism, and often peculation too, become supreme. Besides, far more money than is wasted now by capitalists on themselves will be wasted by politicians hankering after popularity, and after jobs for themselves and their followers and dependents. The greatest wasters in the poorest districts are the irresponsible Socialist authorities. In palatial town halls sumptuously furnished, in magnificent public libraries, in marble baths, and other outlets of civic magnificence, money wrung from the hard-worked wage-earners is wasted in far greater sums than could possibly be spent by the most reckless capitalist on his private amusement. The most magnificent town halls, &c., are to be found in the poorest districts. Besides, "salaries must be liberal enough to attract the best men to the public service."[689]It is a matter of course that the rule of irresponsible Socialist agitators, that a system of local government whereby those who have no money are enabled to spend lavishly by drawing upon those who have money, will not make for efficiency and economy, and the end will be the Poplar-ising of Great Britain. There is a generallyaccepted principle, "No taxation without representation." That principle requires as a supplement, "No representation without taxation." Otherwise Great Britain will be ruled by a mob headed by imaginative and dishonest demagogues.

No enterprise is too large or too costly for the Socialists. Quite recently the Fabians recommended in a leaflet that Glasgow should acquire the whole built-over ground of the city at a cost of 24,000,000l., issuing against that sum Corporation Bonds bearing 3-1/4 per cent. interest. Provided that everything should be settled according to expectations, and supposing that Glasgow should be able to borrow 24,000,000l.at 3-1/4 per cent., which seems extremely unlikely, there would accrue, on the most favourable showing, a net profit of 200,000l.per annum to Glasgow, if nothing be allowed for the cost of management.[690]The possibility that that gigantic speculation might prove a failure is not even considered. On the contrary, it is assumed as certain that Glasgow will greatly profit by the growing value of land. Now if through natural economic development, or through the rule of a Socialist national or local administration, Glasgow should decline and land in Glasgow should fall in value, the town might be ruined. Of course that would not hurt the penniless Socialist agitators. Besides, there would always be the sovereign remedy of repudiation.

According to the fundamental Socialist doctrines which condemn profit,[691]"Municipal trading does not seek profit. To the private trader the making of profits or losses is a vital matter. He makes the mistake of thinking the same motives induce a municipality to provide a public service."[692]To the Socialist administrators it is quite immaterial whether their enterprises are run at a profit or at a loss, so long as they can drawfreely on the rich and well-to-do to pay for their extravagance. "The Socialist view of the fair way of dealing with profits on trading concerns is to have none—if one may be excused so paradoxical a statement. Fair wages and good conditions generally for the employees, and selling at cost so that all may use freely the commodity or service, is the nearest approach to justice in respect to such municipal concerns as are incapable of being used with equal freedom by all."[693]"The only sound principle of municipal management is to run all these things primarily for use, with no idea of making profit at all, and as far as possible at a price to the user covering the cost of the production only. Such profits as are made should be used either to extend municipal enterprise or be utilised for what in Scotland is known as "the common good," that is, in the provision of instruction, amusements, parks and open spaces, helpful and beneficial to all."[694]

"Municipalisation or nationalisation must proceed on the right lines and for a practical object. What should be the object of municipalisation and nationalisation? The primary object should be the most economical provision of the best possible public services. The general well-being should be the first consideration to be served, having due regard to the welfare of each and all engaged in these services. The idea of profit either in the shape of interest on loans, or of reduced rates and taxes, should be eliminated altogether."[695]"The private trader always pursues profits. That is why he is such a dreadful failure. The motive of municipal trading, on the contrary, is public welfare—the benefit of all the citizens. That is why it is such a tremendous success. No one ever thinks of criticising a town council because they make no profitson these services. Now when we consider the question of municipal trading in gas, tramways, and electricity, is the principle involved any different? Not at all. The provision of gas, trams, and electricity is inspired by just the same motives as inspired the provision of roads, parks, libraries, sewerages, police, and education. That is to say, the benefit of all the citizens."[696]"The day may come when municipal trams and municipal light will be just as free as municipal streets and municipal libraries. That is to say, a rate will be levied on the citizens for their upkeep, and everyone will be free to use them as required."[697]

Such an ideal state of affairs, as pictured by scientific Mr. Webb and his rapacious followers, would be most desirable from the point of view of the town loafer. He would no longer monopolise the free library, the lodging-house, and the public-house corners, as he does at present. He would vary the monotony of the reading-room and the street corner by free rides up and down the town and into the country. In the evening he would take a hot bath in the free public baths recommended by Sidney Webb, sit for a while in the free clubs recommended by the same gentleman, and then stroll out to the free public park to view the free fireworks and listen to the free music. Free meals and lodgings will no doubt follow in due course. Great Britain will be ruled for the benefit of the tramp. Why should anybody work in such a "free" country? Who would not be a loafer or a tramp under these conditions—especially as the "vice" of work, to use a Socialistic expression, would speedily be visited by punishment in the shape of confiscatory taxation, if not of direct confiscation? The populace of decaying Athens and Rome lived under those conditions which are the ideals of British Socialists. The citizens lived by their votes for a time in idleness.They were fed and clothed by slaves and subject nations. But the end was starvation.

To provide all these free benefits for those unwilling to work, the owners of property would of course have to be taxed out of existence. "There is no limit to the present rating powers of the local authority, nor to the taxing powers of the State. The recognised limits to local and national taxation are the needs of the respective authorities. Though not perhaps clearly or generally understood, the taxing powers of the community are based upon the principle that private property is only permitted to be held or enjoyed by individuals so long as that private possession is not opposed to the general welfare, and so long as the community does not require the property or the income for public purposes. The Socialist accepts the principle of taxation—taxation 'according to ability derived from the profits of stock-in-trade and other property'—but desires deliberately to incorporate another idea and purpose in taxation, namely, the taxation of the rich to secure such socially created wealth as is now taken in rent, interest, and profit, and to use this revenue for social reform purposes. In other words, we would by that means compel 'the rendering unto Cæsar the things that are Cæsar's.'"[698]Municipal funds would be provided, not only by local rates, but also by a local income and land taxes.[699]In other words, Socialism would eat the goose that lays the golden eggs.

According to leading Socialists, municipal enterprise is preferable to private enterprise, not only for economic but also for moral reasons. "The system of private enterprise and competition reeks with corruption. Honesty under it is impossible. Municipal Socialism, on thecontrary, would provide an environment which would encourage and promote the growth of moral activities. Instead of leading to corruption it would lead away from it."[700]"Private enterprise must lead to fraud, deceit, bribery, corruption, and even murder, in the struggle for existence. Municipal Socialism would entirely remove any temptation to commit these immoral actions. Why? Because, under municipal Socialism, every person who worked would be sure of a living."[701]We have seen some samples of the moral and purifying influence of municipal Socialism in the investigations recently made by the Board of Trade. Unfortunately these have revealed the fact that, in many of the most advanced Socialist corporations, fraud, bribery, intimidation, favouritism, and common theft are of daily occurrence. What else can be expected when men of predatory instincts, who preach the gospel of idleness and confiscation, who live not by work but by talk, who have been accustomed to handle pence, and who have to be taught by the town clerk how to sign a cheque, are suddenly enabled to dispose of thousands of pounds and to negotiate loans?

The general public takes little interest in local elections. Most citizens abstain from voting. Therefore the numerous corporation employees often have the decisive vote in local elections, and they will support only a candidate who promises shorter hours or higher pay. Municipal employees sitting in the public galleries will even dominate the council chamber, intimidate councillors, and shout down those of whom they disapprove. Besides, they may strike and disorganise the public services, and make the Socialistic authorities look ridiculous. Therefore it is better to humour and to obey them than to oppose them. The Fabian Society demands for municipal servants "full liberty of combination," because "theservants of the public may often need protection against the public, as in the Post Office."[702]The results of Socialist teachings are to be seen in many municipalities. "The servants of the public" are already, and will in an increasing degree become, the masters of the public.

Under municipal Socialism the wages of tramway-men have increased as follows: "In Sheffield, where the private company paid 100l.for labour, the Corporation pay 165l.for the same amount of work. In Bolton, where the private company paid 100l., the Corporation pay 137l.In Wallasey, where the private company paid 100l., the District Council pay 185l.In Northampton, where the private company paid 100l., the Corporation pay 120l.In Birkenhead, where the private company paid 100l., the Corporation pay 315l.In Portsmouth, where the private company paid 100l., the Corporation pay 130l.In Sunderland, where the private company paid 100l., the Corporation pay 145l.When the Manchester Corporation took over the trams they paid increased wages amounting to 60,000l.a year."[703]

The foregoing information is given by a Socialist. Some of the advances may be justified, but others, and probably the majority, have been made with that fine disregard of economy which is commonly found among men who can afford to be generous at other people's expense. Municipal Socialism is an ever-growing cancer which is rapidly exhausting the country.

"Half the municipal debt is of a nature which can never yield a profit."[704]The other half is invested in enterprises many of which are run regardless of economy and of expense, regardless of profit and loss, in accordance with the Socialistic principles stated in this Chapter. The policy of deliberate waste and of constant increaseof debt, the principles of "launching out into something new" and "levelling up their districts," perhaps also the fear of eventual bankruptcy and repudiation, have at last frightened the investor. Corporation stocks can no longer be considered as safe first-class securities. Besides, the banks have begun to refuse to accommodate Socialistic municipalities with the necessary funds by overdrafts, short loans, &c. Socialists have therefore begun to complain when they saw that the unlimited supply of other peoples' money was diminishing. They consider it a grievance that they can no longer arbitrarily squander on fantastic undertakings what is not their own. "The hostility of the banking interest to municipal borrowing, and the threat to 'cut off supplies' has at length taken practical form. Disappointed in their attempt to secure sufficiently favourable treatment from their bankers (Parr's), the Chester Corporation applied to four other banks in the city, viz. Lloyds, North and South Wales, National Provincial, and Liverpool Banks. All refused to tender for the account. The banks are not run for the public, the public are run for the bankers."[705]Also, the banks, instead of lending their funds gratis to Socialist corporations, are heartless enough to demand interest "usury" on their loans. "Unfortunately at present public bodies must pay heavy tribute as interest on borrowed money."[706]"Our embryo Socialistic enterprises are even now suffering from the toll of interest which a restricted credit and currency permit the money lords to exact."[707]

Has the attitude of the investing public and the banks caused the Socialist municipalities to restrain their insane expenditure, and to keep it within legitimate bounds? No, they have tried to obtain money by borrowing it insmall sums directly from the public. "The Corporation of Bolton, the Boroughs of Heywood, Middleton, and others, invite the investment of small sums of money in municipal enterprise, offering a higher rate of interest on deposits than the banks can supply."[708]

Many Socialists advocate that the municipalities should raise money by issuing paper-money in unlimited quantities or that they should become bankers, pay interest on deposits, and invest the savings of the poor in highly speculative enterprises carried on without regard to economy and expense, or to profit and loss. "Why pay in usury at all? Abolish the gold monopoly by demonetising metals, and the sole remaining argument against municipal trading disappears along with the most crippling restriction under which public enterprise labours."[709]"Credit notes would be of little use were the city's credit gone, because the people would be afraid to take them. However valuable the assets of a municipal authority might be—and municipal concerns are usually far more substantial and sound than banking companies are—it is public confidence that constitutes the first requisite, and this it is the duty of all reformers to establish and maintain against the assaults of those whose interest it is to break it down. The institution of municipal savings banks under the protection of, and subject to inspection by, the State would assist public authorities and render them less dependent on the bankers; then when people had become accustomed to thinking their city's credit at least equal to that of the leading banks, a limited issue of notes might be allowed."[710]Further proposals for "demonetising" gold and issuing unlimited amounts of unconvertible notes, on the model of the assignats of the French Revolution, will be foundin Chapter XX. "Some Socialist Views on Money, Banks, and Banking."[711]

These and many other dangerous experiments could easily be undertaken by needy demagogues with fantastic ideas, if the supervision of municipalities by the national Government were abolished. Therefore the Independent Labour Party passed at the last Annual Conference the following resolution: "That this Conference urges the Labour party in Parliament to secure the extension of power to municipalities, enabling them to undertake trading and the development of existing municipal concerns, without the sanction of the Local Government Board, and to use any profits accruing from same in such manner as may be decided by the municipality, without the necessity of promoting Parliamentary Bills."[712]

No administration can continue for long a financial and general policy of waste and pillage, such as that followed by the Socialist municipalities of Great Britain, without diminishing not merely private wealth but also the national wealth. The British Socialists seem determined to do all they can to destroy as fast as possible the accumulated wealth of the country and its productive power.

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