<SPAN name="startofbook"></SPAN>
<h1 align="center"> <span >THE THEORY OF SOCIAL REVOLUTIONS</span><br/> <span >BY</span><br/> <span >BROOKS ADAMS</span><br/> <br/> </h1>
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<h2 align="center">PREFATORY NOTE</h2>
<p>The first chapter of the following book was published, in substantially its
present form, in the <i>Atlantic Monthly</i> for April, 1913. I have to thank
the editor for his courtesy in assenting to my wish to reprint. The other
chapters have not appeared before. I desire also to express my obligations to my
learned friend, Dr. M.M. Bigelow, who, most kindly, at my request, read chapters
two and three, which deal with the constitutional law, and gave me the benefit
of his most valuable criticism.</p>
<p>Further than this I have but one word to add. I have written in support of no
political movement, nor for any ephemeral purpose. I have written only to
express a deep conviction which is the result of more than twenty years of
study, and reflection upon this subject.</p>
<p>BROOKS ADAMS.</p>
<p>QUINCY, MASSACHUSETTS, May 17, 1913.</p>
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<SPAN name="CHAPTER_I"></SPAN>
<h2 align="center">CHAPTER I</h2>
<p align="center">THE COLLAPSE OF CAPITALISTIC GOVERNMENT</p>
<br/>
<p>Civilization, I apprehend, is nearly synonymous with order. However much we
may differ touching such matters as the distribution of property, the domestic
relations, the law of inheritance and the like, most of us, I should suppose,
would agree that without order civilization, as we understand it, cannot exist.
Now, although the optimist contends that, since man cannot foresee the future,
worry about the future is futile, and that everything, in the best possible of
worlds, is inevitably for the best, I think it clear that within recent years an
uneasy suspicion has come into being that the principle of authority has been
dangerously impaired, and that the social system, if it is to cohere, must be
reorganized. So far as my observation has extended, such intuitions are usually
not without an adequate cause, and if there be reason for anxiety anywhere, it
surely should be in the United States, with its unwieldy bulk, its heterogeneous
population, and its complex government. Therefore, I submit, that an hour may
not be quite wasted which is passed in considering some of the recent phenomena
which have appeared about us, in order to ascertain if they can be grouped
together in any comprehensible relation.</p>
<p>About a century ago, after, the American and French Revolutions and the
Napoleonic wars, the present industrial era opened, and brought with it a new
governing class, as every considerable change in human environment must bring
with it a governing class to give it expression. Perhaps, for lack of a
recognized name, I may describe this class as the industrial capitalistic class,
composed in the main of administrators and bankers. As nothing in the universe
is stationary, ruling classes have their rise, culmination, and decline, and I
conjecture that this class attained to its acme of popularity and power, at
least in America, toward the close of the third quarter of the nineteenth
century. I draw this inference from the fact that in the next quarter resistance
to capitalistic methods began to take shape in such legislation as the
Interstate Commerce Law and the Sherman Act, and almost at the opening of the
present century a progressively rigorous opposition found for its mouthpiece the
President of the Union himself. History may not be a very practical study, but
it teaches some useful lessons, one of which is that nothing is accidental, and
that if men move in a given direction, they do so in obedience to an impulsion
as automatic as is the impulsion of gravitation. Therefore, if Mr. Roosevelt
became, what his adversaries are pleased to call, an agitator, his agitation had
a cause which is as deserving of study as is the path of a cyclone. This problem
has long interested me, and I harbor no doubt not only that the equilibrium of
society is very rapidly shifting, but that Mr. Roosevelt has,
half-automatically, been stimulated by the instability about him to seek for a
new centre of social gravity. In plain English, I infer that he has concluded
that industrialism has induced conditions which can no longer be controlled by
the old capitalistic methods, and that the country must be brought to a level of
administrative efficiency competent to deal with the strains and stresses of the
twentieth century, just as, a hundred and twenty-five years ago, the country was
brought to an administrative level competent for that age, by the adoption of
the Constitution. Acting on these premises, as I conjecture, whether consciously
worked out or not, Mr. Roosevelt's next step was to begin the readjustment; but,
I infer, that on attempting any correlated measures of reform, Mr. Roosevelt
found progress impossible, because of the obstruction of the courts. Hence his
instinct led him to try to overleap that obstruction, and he suggested, without,
I suspect, examining the problem very deeply, that the people should assume the
right of "recalling" judicial decisions made in causes which involved
the nullifying of legislation. What would have happened had Mr. Roosevelt been
given the opportunity to thoroughly formulate his ideas, even in the midst of an
election, can never be known, for it chanced that he was forced to deal with
subjects as vast and complex as ever vexed a statesman or a jurist, under
difficulties at least equal to the difficulties of the task itself. If the
modern mind has developed one characteristic more markedly than another, it is
an impatience with prolonged demands on its attention, especially if the subject
be tedious. No one could imagine that the New York press of to-day would print
the disquisitions which Hamilton wrote in 1788 in support of the Constitution,
or that, if it did, any one would read them, least of all the lawyers; and yet
Mr. Roosevelt's audience was emotional and discursive even for a modern American
audience. Hence, if he attempted to lead at all, he had little choice but to
adopt, or at least discuss, every nostrum for reaching an immediate millennium
which happened to be uppermost; although, at the same time, he had to defend
himself against an attack compared with which any criticism to which Hamilton
may have been subjected resembled a caress. The result has been that the
Progressive movement, bearing Mr. Roosevelt with it, has degenerated into a
disintegrating rather than a constructive energy, which is, I suspect, likely to
become a danger to every one interested in the maintenance of order, not to say
in the stability of property. Mr. Roosevelt is admittedly a strong and
determined man whose instinct is arbitrary, and yet, if my analysis be sound, we
see him, at the supreme moment of his life, diverted from his chosen path toward
centralization of power, and projected into an environment of, apparently, for
the most part, philanthropists and women, who could hardly conceivably form a
party fit to aid him in establishing a vigorous, consolidated, administrative
system. He must have found the pressure toward disintegration resistless, and if
we consider this most significant phenomenon, in connection with an abundance of
similar phenomena, in other countries, which indicate social incoherence, we can
hardly resist a growing apprehension touching the future. Nor is that
apprehension allayed if, to reassure ourselves, we turn to history, for there we
find on every side long series of precedents more ominous still.</p>
<p>Were all other evidence lacking, the inference that radical changes are at
hand might be deduced from the past. In the experience of the English-speaking
race, about once in every three generations a social convulsion has occurred;
and probably such catastrophes must continue to occur in order that laws and
institutions may be adapted to physical growth. Human society is a living
organism, working mechanically, like any other organism. It has members, a
circulation, a nervous system, and a sort of skin or envelope, consisting of its
laws and institutions. This skin, or envelope, however, does not expand
automatically, as it would had Providence intended humanity to be peaceful, but
is only fitted to new conditions by those painful and conscious efforts which we
call revolutions. Usually these revolutions are warlike, but sometimes they are
benign, as was the revolution over which General Washington, our first great
"Progressive," presided, when the rotting Confederation, under his
guidance, was converted into a relatively excellent administrative system by the
adoption of the Constitution.</p>
<p>Taken for all in all, I conceive General Washington to have been the greatest
man of the eighteenth century, but to me his greatness chiefly consists in that
balance of mind which enabled him to recognize when an old order had passed
away, and to perceive how a new order could be best introduced. Joseph Story was
ten years old in 1789 when the Constitution was adopted; his earliest
impressions, therefore, were of the Confederation, and I know no better
description of the interval just subsequent to the peace of 1783, than is
contained in a few lines in his dissenting opinion in the Charles River Bridge
Case--</p>
<p>"In order to entertain a just view of this subject, we must go back to
that period of general bankruptcy, and distress and difficulty (1785).... The
union of the States was crumbling into ruins, under the old Confederation.
Agriculture, manufactures, and commerce were at their lowest ebb. There was
infinite danger to all the States from local interests and jealousies, and from
the apparent impossibility of a much longer adherence to that shadow of a
government, the Continental Congress. And even four years afterwards, when every
evil had been greatly aggravated, and civil war was added to other calamities,
the Constitution of the United States was all but shipwrecked in passing through
the state conventions."<SPAN name="FNanchor1"></SPAN><SPAN href="#Footnote_1"><sup>[1]</sup></SPAN></p>
<p>This crisis, according to my computation, was the normal one of the third
generation. Between 1688 and 1765 the British Empire had physically outgrown its
legal envelope, and the consequence was a revolution. The thirteen American
colonies, which formed the western section of the imperial mass, split from the
core and drifted into chaos, beyond the constraint of existing law. Washington
was, in his way, a large capitalist, but he was much more. He was not only a
wealthy planter, but he was an engineer, a traveller, to an extent a
manufacturer, a politician, and a soldier, and he saw that, as a conservative,
he must be "Progressive" and raise the law to a power high enough to
constrain all these thirteen refractory units. For Washington understood that
peace does not consist in talking platitudes at conferences, but in organizing a
sovereignty strong enough to coerce its subjects.</p>
<p>The problem of constructing such a sovereignty was the problem which
Washington solved, temporarily at least, without violence. He prevailed not only
because of an intelligence and elevation of character which enabled him to
comprehend, and to persuade others, that, to attain a common end, all must make
sacrifices, but also because he was supported by a body of the most remarkable
men whom America has ever produced. Men who, though doubtless in a numerical
minority, taking the country as a whole, by sheer weight of ability and energy,
achieved their purpose.</p>
<p>Yet even Washington and his adherents could not alter the limitations of the
human mind. He could postpone, but he could not avert, the impact of conflicting
social forces. In 1789 he compromised, but he did not determine the question of
sovereignty. He eluded an impending conflict by introducing courts as political
arbitrators, and the expedient worked more or less well until the tension
reached a certain point. Then it broke down, and the question of sovereignty had
to be settled in America, as elsewhere, on the field of battle. It was not
decided until Appomattox. But the function of the courts in American life is a
subject which I shall consider hereafter.</p>
<p>If the invention of gunpowder and printing in the fourteenth and fifteenth
centuries presaged the Reformation of the sixteenth, and if the Industrial
Revolution of the eighteenth was the forerunner of political revolutions
throughout the Western World, we may well, after the mechanical and economic
cataclysm of the nineteenth, cease wondering that twentieth-century society
should be radical.</p>
<p>Never since man first walked erect have his relations toward nature been so
changed, within the same space of time, as they have been since Washington was
elected President and the Parisian mob stormed the Bastille. Washington found
the task of a readjustment heavy enough, but the civilization he knew was
simple. When Washington lived, the fund of energy at man's disposal had not very
sensibly augmented since the fall of Rome. In the eighteenth, as in the fourth
century, engineers had at command only animal power, and a little wind and water
power, to which had been added, at the end of the Middle Ages, a low explosive.
There was nothing in the daily life of his age which made the legal and
administrative principles which had sufficed for Justinian insufficient for him.
Twentieth-century society rests on a basis not different so much in degree, as
in kind, from all that has gone before. Through applied science infinite forces
have been domesticated, and the action of these infinite forces upon finite
minds has been to create a tension, together with a social acceleration and
concentration, not only unparalleled, but, apparently, without limit. Meanwhile
our laws and institutions have remained, in substance, constant. I doubt if we
have developed a single important administrative principle which would be novel
to Napoleon, were he to live again, and I am quite sure that we have no legal
principle younger than Justinian.</p>
<p>As a result, society has been squeezed, as it were, from its rigid
eighteenth-century legal shell, and has passed into a fourth dimension of space,
where it performs its most important functions beyond the cognizance of the law,
which remains in a space of but three dimensions. Washington encountered a
somewhat analogous problem when dealing with the thirteen petty independent
states, which had escaped from England; but his problem was relatively
rudimentary. Taking the theory of sovereignty as it stood, he had only to apply
it to communities. It was mainly a question of concentrating a sufficient amount
of energy to enforce order in sovereign social units. The whole social detail
remained unchanged. Our conditions would seem to imply a very considerable
extension and specialization of the principle of sovereignty, together with a
commensurate increment of energy, but unfortunately the twentieth-century
American problem is still further complicated by the character of the envelope
in which this highly volatilized society is theoretically contained. To attain
his object, Washington introduced a written organic law, which of all things is
the most inflexible. No other modern nation has to consider such an impediment.</p>
<p>Moneyed capital I take to be stored human energy, as a coal measure is stored
solar energy; and moneyed capital, under the stress of modern life, has
developed at once extreme fluidity, and an equivalent compressibility. Thus a
small number of men can control it in enormous masses, and so it comes to pass
that, in a community like the United States, a few men, or even, in certain
emergencies, a single man, may become clothed with various of the attributes of
sovereignty. Sovereign powers are powers so important that the community, in its
corporate capacity, has, as society has centralized, usually found it necessary
to monopolize them more or less absolutely, since their possession by private
persons causes revolt. These powers, when vested in some official, as, for
example, a king or emperor, have been held by him, in all Western countries at
least, as a trust to be used for the common welfare. A breach of that trust has
commonly been punished by deposition or death. It was upon a charge of breach of
trust that Charles I, among other sovereigns, was tried and executed. In short,
the relation of sovereign and subject has been based either upon consent and
mutual obligation, or upon submission to a divine command; but, in either case,
upon recognition of responsibility. Only the relation of master and slave
implies the status of sovereign power vested in an unaccountable superior.
Nevertheless, it is in a relation somewhat analogous to the latter, that the
modern capitalist has been placed toward his fellow citizens, by the advances in
applied science. An example or two will explain my meaning.</p>
<p>High among sovereign powers has always ranked the ownership and
administration of highways. And it is evident why this should have been so.
Movement is life, and the stoppage of movement is death, and the movement of
every people flows along its highways. An invader has only to cut the
communications of the invaded to paralyze him, as he would paralyze an animal by
cutting his arteries or tendons. Accordingly, in all ages and in all lands, down
to the nineteenth century, nations even partially centralized have, in their
corporate capacity, owned and cared for their highways, either directly or
through accountable agents. And they have paid for them by direct taxes, like
the Romans, or by tolls levied upon traffic, as many mediaeval governments
preferred to do. Either method answers its purpose, provided the government
recognizes its responsibility; and no government ever recognized this
responsibility more fully than did the autocratic government of ancient Rome. So
the absolute r�gime of eighteenth-century France recognized this responsibility
when Louis XVI undertook to remedy the abuse of unequal taxation, for the
maintenance of the highways, by abolishing the corv�e.</p>
<p>Toward the middle of the nineteenth century, the application, by science, of
steam to locomotion, made railways a favorite speculation. Forthwith, private
capital acquired these highways, and because of the inelasticity of the old law,
treated them as ordinary chattels, to be administered for the profit of the
owner exclusively. It is true that railway companies posed as public agents when
demanding the power to take private property; but when it came to charging for
use of their ways, they claimed to be only private carriers, authorized to
bargain as they pleased. Indeed, it grew to be considered a mark of efficient
railroad management to extract the largest revenue possible from the people,
along the lines of least resistance; that is, by taxing most heavily those
individuals and localities which could least resist. And the claim by the
railroads that they might do this as a matter of right was long upheld by the
courts,<SPAN name="FNanchor2"></SPAN><SPAN href="#Footnote_2"><sup>[2]</sup></SPAN> nor have
the judges even yet, after a generation of revolt and of legislation, altogether
abandoned this doctrine.</p>
<p>The courts--reluctantly, it is true, and principally at the instigation of
the railways themselves, who found the practice unprofitable-have latterly
discountenanced discrimination as to persons, but they still uphold
discrimination as to localities.<SPAN name="FNanchor3"></SPAN><SPAN href="#Footnote_3"><sup>[3]</sup></SPAN>
Now, among abuses of sovereign power, this is one of the most galling, for of
all taxes the transportation tax is perhaps that which is most searching, most
insidious, and, when misused, most destructive. The price paid for
transportation is not so essential to the public welfare as its equality; for
neither persons nor localities can prosper when the necessaries of life cost
them more than they cost their competitors. In towns, no cup of water can be
drunk, no crust of bread eaten, no garment worn, which has not paid the
transportation tax, and the farmer's crops must rot upon his land, if other
farmers pay enough less than he to exclude him from markets toward which they
all stand in a position otherwise equal. Yet this formidable power has been
usurped by private persons who have used it purely selfishly, as no legitimate
sovereign could have used it, and by persons who have indignantly denounced all
attempts to hold them accountable, as an infringement of their constitutional
rights. Obviously, capital cannot assume the position of an irresponsible
sovereign, living in a sphere beyond the domain of law, without inviting the
fate which has awaited all sovereigns who have denied or abused their trust.</p>
<p>The operation of the New York Clearing-House is another example of the
acquisition of sovereign power by irresponsible private persons. Primarily, of
course, a clearing-house is an innocent institution occupied with adjusting
balances between banks, and has no relation to the volume of the currency.
Furthermore, among all highly centralized nations, the regulation of the
currency is one of the most jealously guarded of the prerogatives of
sovereignty, because all values hinge upon the relation which the volume of the
currency bears to the volume of trade. Yet, as everybody knows, in moments of
financial panic, the handful of financiers who, directly or indirectly, govern
the Clearing-House, have it in their power either to expand or to contract the
currency, by issuing or by withdrawing Clearing-House certificates, more
effectually perhaps than if they controlled the Treasury of the United States.
Nor does this power, vast as it is, at all represent the supremacy which a few
bankers enjoy over values, because of their facilities for manipulating the
currency and, with the currency, credit; facilities, which are used or abused
entirely beyond the reach of the law.</p>
<p>Bankers, at their conventions and through the press, are wont to denounce the
American monetary system, and without doubt all that they say, and much more
that they do not say, is true; and yet I should suppose that there could be
little doubt that American financiers might, after the panic of 1893, and before
the administration of Mr. Taft, have obtained from Congress, at most sessions,
very reasonable legislation, had they first agreed upon the reforms they
demanded, and, secondly, manifested their readiness, as a condition precedent to
such reforms, to submit to effective government supervision in those departments
of their business which relate to the inflation or depression of values. They
have shown little inclination to submit to restraint in these particulars, nor,
perhaps, is their reluctance surprising, for the possession by a very small
favored class of the unquestioned privilege, whether actually used or not, at
recurring intervals, of subjecting the debtor class to such pressure as the
creditor may think necessary, in order to force the debtor to surrender his
property to the creditor at the creditor's price, is a wonder beside which
Aladdin's lamp burns dim.</p>
<p>As I have already remarked, I apprehend that sovereignty is a variable
quantity of administrative energy, which, in civilizations which we call
advancing, tends to accumulate with a rapidity proportionate to the acceleration
of movement. That is to say, the community, as it consolidates, finds it
essential to its safety to withdraw, more or less completely, from individuals,
and to monopolize, more or less strictly, itself, a great variety of functions.
At one stage of civilization the head of the family administers justice,
maintains an armed force for war or police, wages war, makes treaties of peace,
coins money, and, not infrequently, wears a crown, usually of a form to indicate
his importance in a hierarchy. At a later stage of civilization, companies of
traders play a great part. Such aggregations of private and irresponsible
adventurers have invaded and conquered empires, founded colonies, and
administered justice to millions of human beings. In our own time, we have seen
the assumption of many of the functions of these and similar private companies
by the sovereign. We have seen the East India Company absorbed by the British
Parliament; we have seen the railways, and the telephone and the telegraph
companies, taken into possession, very generally, by the most progressive
governments of the world; and now we have come to the necessity of dealing with
the domestic-trade monopoly, because trade has fallen into monopoly through the
centralization of capital in a constantly contracting circle of ownership.</p>
<p>Among innumerable kinds of monopolies none have been more troublesome than
trade monopolies, especially those which control the price of the necessaries of
life; for, so far as I know, no people, approximately free, have long endured
such monopolies patiently. Nor could they well have done so without constraint
by overpowering physical force, for the possession of a monopoly of a necessary
of life by an individual, or by a small privileged class, is tantamount to
investing a minority, contemptible alike in numbers and in physical force, with
an arbitrary and unlimited power to tax the majority, not for public, but for
private purposes. Therefore it has not infrequently happened that persistence in
adhering to and in enforcing such monopolies has led, first, to attempts at
regulation, and, these failing, to confiscation, and sometimes to the
proscription of the owners. An example of such a phenomenon occurs to me which,
just now, seems apposite.</p>
<p>In the earlier Middle Ages, before gunpowder made fortified houses untenable
when attacked by the sovereign, the highways were so dangerous that trade and
manufactures could only survive in walled towns. An unarmed urban population had
to buy its privileges, and to pay for these a syndicate grew up in each town,
which became responsible for the town ferm, or tax, and, in return, collected
what part of the municipal expenses it could from the poorer inhabitants. These
syndicates, called guilds, as a means of raising money, regulated trade and
fixed prices, and they succeeded in fixing prices because they could prevent
competition within the walls. Presently complaints became rife of guild
oppression, and the courts had to entertain these complaints from the outset, to
keep some semblance of order; but at length the turmoil passed beyond the reach
of the courts, and Parliament intervened. Parliament not only enacted a series
of statutes regulating prices in towns, but supervised guild membership,
requiring trading companies to receive new members upon what Parliament
considered to be reasonable terms. Nevertheless, friction continued.</p>
<p>With advances in science, artillery improved, and, as artillery improved, the
police strengthened until the king could arrest whom he pleased. Then the
country grew safe and manufactures migrated from the walled and heavily taxed
towns to the cheap, open villages, and from thence undersold the guilds. As the
area of competition broadened, so the guilds weakened, until, under Edward VI,
being no longer able to defend themselves, they were ruthlessly and savagely
plundered; and fifty years later the Court of King's Bench gravely held that a
royal grant of a monopoly had always been bad at common law.<SPAN name="FNanchor4"></SPAN><SPAN href="#Footnote_4"><sup>[4]</sup></SPAN></p>
<p>Though the Court's law proved to be good, since it has stood, its history was
fantastic; for the trade-guild was the offspring of trade monopoly, and a trade
monopoly had for centuries been granted habitually by the feudal landlord to his
tenants, and indeed was the only means by which an urban population could
finance its military expenditure. Then, in due course, the Crown tried to
establish its exclusive right to grant monopolies, and finally Parliament--or
King, Lords, and Commons combined, being the whole nation in its corporate
capacity,--appropriated this monopoly of monopolies as its supreme prerogative.
And with Parliament this monopoly has ever since remained.</p>
<p>In fine, monopolies, or competition in trade, appear to be recurrent social
phases which depend upon the ratio which the mass and the fluidity of capital,
or, in other words, its energy, bears to the area within which competition is
possible. In the Middle Ages, when the town walls bounded that area, or when, at
most, it was restricted to a few lines of communication between defensible
points garrisoned by the monopolists,--as were the Staple towns of England
which carried on the wool trade with the British fortified counting-houses in
Flanders,--a small quantity of sluggish capital sufficed. But as police
improved, and the area of competition broadened faster than capital accumulated
and quickened, the competitive phase dawned, whose advent is marked by Darcy <i>v</i>.
Allein, decided in the year 1600. Finally, the issue between monopoly and free
trade was fought out in the American Revolution, for the measure which
precipitated hostilities was the effort of England to impose her monopoly of the
Eastern trade upon America. The Boston Tea Party occurred on December 16, 1773.
Then came the heyday of competition with the acceptance of the theories of Adam
Smith, and the political domination in England, towards 1840, of the Manchester
school of political economy.</p>
<p>About forty years since, in America at least, the tide would appear once more
to have turned. I fix the moment of flux, as I am apt to do, by a lawsuit. This
suit was the Morris Run Coal Company <i>v.</i> Barclay Coal Company,<SPAN name="FNanchor5"></SPAN><SPAN href="#Footnote_5"><sup>[5]</sup></SPAN>
which is the first modern anti-monopoly litigation that I have met with in the
United States. It was decided in Pennsylvania in 1871; and since 1871, while the
area within which competition is possible has been kept constant by the tariff,
capital has accumulated and has been concentrated and volatilized until, within
this republic, substantially all prices are fixed by a vast moneyed mass. This
mass, obeying what amounts to being a single volition, has its heart in Wall
Street, and pervades every corner of the Union. No matter what price is in
question, whether it be the price of meat, or coal, or cotton cloth, or of
railway transportation, or of insurance, or of discounts, the inquirer will find
the price to be, in essence, a monopoly or fixed price; and if he will follow
his investigation to the end, he will also find that the first cause in the
complex chain of cause and effect which created the monopoly in that mysterious
energy which is enthroned on the Hudson.</p>
<p>The presence of monopolistic prices in trade is not always a result of
conscious agreement; more frequently, perhaps, it is automatic, and is an effect
of the concentration of capital in a point where competition ceases, as when all
the capital engaged in a trade belongs to a single owner. Supposing ownership to
be enough restricted, combination is easier and more profitable than
competition; therefore combination, conscious or unconscious, supplants
competition. The inference from the evidence is that, in the United States,
capital has reached, or is rapidly reaching, this point of concentration; and if
this be true, competition cannot be enforced by legislation. But, assuming that
competition could still be enforced by law, the only effect would be to make the
mass of capital more homogeneous by eliminating still further such of the weaker
capitalists as have survived. Ultimately, unless indeed society is to dissolve
and capital migrate elsewhere, all the present phenomena would be intensified.
Nor would free trade, probably, have more than a very transitory effect. In no
department of trade is competition freer than in the Atlantic passenger service,
and yet in no trade is there a stricter monopoly price.</p>
<p>The same acceleration of the social movement which has caused this
centralization of capital has caused the centralization of another form of human
energy, which is its negative: labor unions organize labor as a monopoly. Labor
protests against the irresponsible sovereignty of capital, as men have always
protested against irresponsible sovereignty, declaring that the capitalistic
social system, as it now exists, is a form of slavery. Very logically,
therefore, the abler and bolder labor agitators proclaim that labor levies
actual war against society, and that in that war there can be no truce until
irresponsible capital has capitulated. Also, in labor's methods of warfare the
same phenomena appear as in the autocracy of capital. Labor attacks capitalistic
society by methods beyond the purview of the law, and may, at any moment,
shatter the social system; while, under our laws and institutions, society is
helpless.</p>
<p>Few persons, I should imagine, who reflect on these phenomena, fail to admit
to themselves, whatever they may say publicly, that present social conditions
are unsatisfactory, and I take the cause of the stress to be that which I have
stated. We have extended the range of applied science until we daily use
infinite forces, and those forces must, apparently, disrupt our society, unless
we can raise the laws and institutions which hold society together to an energy
and efficiency commensurate to them. How much vigor and ability would be
required to accomplish such a work may be measured by the experience of
Washington, who barely prevailed in his relatively simple task, surrounded by a
generation of extraordinary men, and with the capitalistic class of America
behind him. Without the capitalistic class he must have failed. Therefore one
most momentous problem of the future is the attitude which capital can or will
assume in this emergency.</p>
<p>That some of the more sagacious of the capitalistic class have preserved that
instinct of self-preservation which was so conspicuous among men of the type of
Washington, is apparent from the position taken by the management of the United
States Steel Company, and by the Republican minority of the Congressional
Committee which recently investigated the Steel Company; but whether such men
very strongly influence the genus to which they belong is not clear. If they do
not, much improvement in existing conditions can hardly be anticipated.</p>
<p>If capital insists upon continuing to exercise sovereign powers, without
accepting responsibility as for a trust, the revolt against the existing order
must probably continue, and that revolt can only be dealt with, as all servile
revolts must be dealt with, by physical force. I doubt, however, if even the
most ardent and optimistic of capitalists would care to speculate deeply upon
the stability of any government capital might organize, which rested on the
fundamental principle that the American people must be ruled by an army. On the
other hand any government to be effective must be strong. It is futile to talk
of keeping peace in labor disputes by compulsory arbitration, if the government
has not the power to command obedience to its arbitrators' decree; but a
government able to constrain a couple of hundred thousand discontented railway
employees to work against their will, must differ considerably from the one we
have. Nor is it possible to imagine that labor will ever yield peaceful
obedience to such constraint, unless capital makes equivalent concessions,--unless,
perhaps, among other things, capital consents to erect tribunals which shall
offer relief to any citizen who can show himself to be oppressed by the
monopolistic price. In fine, a government, to promise stability in the future,
must apparently be so much more powerful than any private interest, that all men
will stand equally before its tribunals; and these tribunals must be flexible
enough to reach those categories of activity which now lie beyond legal
jurisdiction. If it be objected that the American people are incapable of an
effort so prodigious, I readily admit that this may be true, but I also contend
that the objection is beside the issue. What the American people can or cannot
do is a matter of opinion, but that social changes are imminent appears to be
almost certain. Though these changes cannot be prevented, possibly they may, to
a degree, be guided, as Washington guided the changes of 1789. To resist them
perversely, as they were resisted at the Chicago Convention of 1912, can only
make the catastrophe, when it comes, as overwhelming as was the consequent
defeat of the Republican party.</p>
<p>Approached thus, that Convention of 1912 has more than a passing importance,
since it would seem to indicate the ordinary phenomenon, that a declining
favored class is incapable of appreciating an approaching change of environment
which must alter its social status. I began with the proposition that, in any
society which we now understand, civilization is equivalent to order, and the
evidence of the truth of the proposition is, that amidst disorder, capital and
credit, which constitute the pith of our civilization, perish first. For more
than a century past, capital and credit have been absolute, or nearly so;
accordingly it has not been the martial type which has enjoyed sovereignty, but
the capitalistic. The warrior has been the capitalists' servant. But now, if it
be true that money, in certain crucial directions, is losing its purchasing
power, it is evident that capitalists must accept a position of equality before
the law under the domination of a type of man who can enforce obedience; their
own obedience, as well as the obedience of others. Indeed, it might occur, even
to some optimists, that capitalists would be fortunate if they could certainly
obtain protection for another fifty years on terms as favorable as these. But at
Chicago, capitalists declined even to consider receding to a secondary position.
Rather than permit the advent of a power beyond their immediate control, they
preferred to shatter the instrument by which they sustained their ascendancy.
For it is clear that Roosevelt's offence in the eyes of the capitalistic class
was not what he had actually done, for he had done nothing seriously to injure
them. The crime they resented was the assertion of the principle of equality
before the law, for equality before the law signified the end of privilege to
operate beyond the range of law. If this principle which Roosevelt, in theory at
least, certainly embodied, came to be rigorously enforced, capitalists perceived
that private persons would be precluded from using the functions of sovereignty
to enrich themselves. There lay the parting of the ways. Sooner or later almost
every successive ruling class has had this dilemma in one of its innumerable
forms presented to them, and few have had the genius to compromise while
compromise was possible. Only a generation ago the aristocracy of the South
deliberately chose a civil war rather than admit the principle that at some
future day they might have to accept compensation for their slaves.</p>
<p>A thousand other instances of similar incapacity might be adduced, but I will
content myself with this alone.</p>
<p>Briefly the precedents induce the inference that privileged classes seldom
have the intelligence to protect themselves by adaptation when nature turns
against them, and, up to the present moment, the old privileged class in the
United States has shown little promise of being an exception to the rule.</p>
<p>Be this, however, as it may, and even assuming that the great industrial and
capitalistic interests would be prepared to assist a movement toward
consolidation, as their ancestors assisted Washington, I deem it far from
probable that they could succeed with the large American middle class, which
naturally should aid, opposed, as it seems now to be, to such a movement.
Partially, doubtless, this opposition is born of fear, since the lesser folk
have learned by bitter experience that the powerful have yielded to nothing save
force, and therefore that their only hope is to crush those who oppress them.
Doubtless, also, there is the inertia incident to long tradition, but I suspect
that the resistance is rather due to a subtle and, as yet, nearly unconscious
instinct, which teaches the numerical majority, who are inimical to capital,
that the shortest and easiest way for them to acquire autocratic authority is to
obtain an absolute mastery over those political tribunals which we call courts.
Also that mastery is being by them rapidly acquired. So long as our courts
retain their present functions no comprehensive administrative reform is
possible, whence I conclude that the relation which our courts shall hold to
politics is now the fundamental problem which the American people must solve,
before any stable social equilibrium can be attained.</p>
<p>Theodore Roosevelt's enemies have been many and bitter. They have attacked
his honesty, his sobriety, his intelligence, and his judgment, but very few of
them have hitherto denied that he has a keen instinct for political strife. Only
of late has this gift been doubted, but now eminent politicians question whether
he did not make a capital mistake when he presented the reform of our courts of
law, as expounders of the Constitution, as one of his two chief issues, in his
canvass for a nomination for a third presidential term.</p>
<p>After many years of study of, and reflection upon, this intricate subject I
have reached the conviction that, though Mr. Roosevelt may have erred in the
remedy which he has suggested, he is right in the principle which he has
advanced, and in my next chapter I propose to give the evidence and explain the
reasons which constrain me to believe that American society must continue to
degenerate until confusion supervenes, if our courts shall remain semi-political
chambers.
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