modern money-lending and the meaning of dividends : a tract (1885) by carpenter edward

8/14/2019 Modern money-lending and the meaning of dividends : a tract (1885) By Carpenter Edward

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MODERN

MONEY-LENDINGAND THE MEANING OF DIVIDENDS:

A TRACTBY

EDWARD CARPENTER.

SECOND EDITION PRICE TWOPENCE.

JOHN HEYWOOD,UEANSGATE AND UIDOKFIEI.D, MANCHESTER ;AND 11, PATKKNObTEK BuiLI'iLONDON.1885.


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StackAnnex

MODERN MONEY-LENDING.

THE practice of Money-lending is now carried outon such an enormous scale, and by such a largeclass of society, and is attended by certain evils sowidespread and disastrous, that it has become fairlynecessary to look the problem in the face ; and what-ever may be the conclusions arrived at, I shall con-sider the purpose of this paper fulfilled if it causes thereader (and myself) to confront the question and tosee that it requires solution.There .has always been a disagreeable odour aboutthis trade. The very word Usury has unpleasantassociations with it. How is it then that we whoreprobate the money-lending Jew of medieval Europeand the marwari whose loans press so heavily to-dayupon the peasant of India, are light-hearted enough tolend our money out at interest without a qualm, and(some of us) to make our entire subsistence on thegains so got from other people ?

Is it that the Shylock and the marwari are so distantfrom us that we do not perceive our relationship tothem?"No," says someone, "the reason is that they

practised and practise Usury ; we only reap InterestTo live on the gains of other people becomes criminalwhen you depass a certain point."What then is that point ? Where is that line to bedrawn which divides legitimate Interest from Usury ?Let us remember that the word Usury simply indicatesthat the person who lends the money expects a rewardfor the Use of it ; and the word Interest indicates that


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4 MODERN MONEY-LENDING.the person who lends the money is interested in, or aparty to, the concern from which the gain is expectedto be made. There is nothing in the original significa-tion of the two words to show one proceeding as morelegitimate than the other.

Certainly it is quite conceivable that a high rate ofInterest might be grossly unfair, and a low rate onlyjust and equitable ; but this distinction of degree canhardly be the ground of our action, since there isnothing that we usually covet more or congratulateourselves more upon than the obtaining of a high rateof interest for our money.No the reason, it seems to me, why we carry onout modern money-lending business without qualmslies simply in the fact that the practice is universalround us. Everybody (which in the " society " signi-fication of the word means everyone who does notwork with his hands) does it. Custom sanctions it ;"the law allows it." And to most people involved inthe practice it naturally never occurs to consider itsrightfulness or wrongful ness at all.But this does not make it the less incumbent onus once we have looked into the matter to get tothe roots of it. Rather more. Let us grub at it then.The fundamental principle of social life and justliving can never, it seems to me, be too often broughtforward. For some reason or other it is only too oftenliable to be obscured. It is this that the existenceand wellbeing of a people are secured by their collec-tive labour, and that only by taking his part in thatlabour can each man have a right to the advantageswhich flow from it. Political Economy always beginswith an island ! At first all are workers, and by afew hours' work daily from each man sufficient of thenecessaries and adornments even of life are produced(from the natural resources of the island) to maintaineveryone in comfort. After a time it is found thatthe state of affairs has changed. Half the population


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MODERN MONEY-LENDING. 5is now living in idleness or at most engaged inoccupations whose benefit to the community is veryremote or dubious. The other half is working veryhard twice as many hours a day in fact as beforeas it must do to keep things up to the former level.This is a sad change for the worse. One half ofthe community is living in degrading slavery, has morework to do than can be done without injury and theblunting of noble powers. The other half is living in(far more) degrading dependence, and is suffering thatinjury to its soul which comes and must come fromall meanness and selfishness.

This second state of affairs on the island is what wenotice on our own Island to-day and in modern sociallife at large. The causes which have led up to it andthe means by which it is kept going are manifold. Theuse of money and of capital, hereditary acquirements,monopoly of land, customs and Jaws now grown falseand harmful, are some of the engines by which onepart of the community retains its power over theother half. The problem of the little island is com-plicated, too, when we come to consider the big Island,by such matters as foreign trade, taxes, misunder-standings as to the nature of money, and all the cog-wheels big and little of social life but essentially it isthe same. These things only serve to disguise thefact that one class is living on the labour of another ;they do not in any way alter the fact.Let us look at the matter again. I have said thatthe money-lending classes are in our modern societyenormously large. They are also enormously on theincrease. It can hardly be otherwise. Let us supposethat in some society conducted on our present systemone man (and only one at first) accumulates enoughmoney to bring him in a substantial income say^500 a year. Then that man is safe. He has escapedfrom the labour of feeding himself and children, andmay fold his arms and amuse himself as he likes he


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6 MODERN MONEY-LENDING.has got on to the dry land beyond the flood and thisin perpetuity practically ; for he may live as long as hecan and then transmit the right to those who comeafter him. He is safe, and except by his own impru-dence need never again join the throng of those whotoil and spin. Presently another man accumulatesthe desired amount, He also " retires," and is safe.Then a third and fourth. Then hundreds and thou-sands, then a cohsiderable proportion of the wholenation where shall we stop ? All the footsteps (withbut few exceptions) point the same way. Few, whoby their own exertions or those of their fathers andgrandfathers, have reached the desired haven are likelyto quit it again. The number must go on increasingyet it is impossible for a whole nation to retire andsuck its thumb ! What is happening ? This is hap-pening a vast and ever vaster proportion of thenation is getting (by force of existing social rights andmachinery) to live on the labour of the rest. Everyday, of those who are harnessed to the car of nationallife and prosperity, one or another by dint of extraforethought, prudence, miserliness, cunning, or what-ever it may be, gets an advantage over the rest, leavesthem, jumps inside the car, and thenceforth, insteadof drawing, is drawn. The end is only too obvious.It is a reductio ad absurdum of national life. It isbreakdown, smash up and the car left in the ditch.These are serious charges to bring against thepractice of money-lending as carried on in modernsociety. Let us look at the other side of the ques-tion.

I have ;SOQ which I have saved out of the productsof my own labour and which I have no immediateuse for. My neighbour offers me 5 per cent perannum for the use of the sum, for a given period.Have I not a perfect right to accept his offer ? ShouldI not be a perfect fool if I refused it ?Yes (in answer to the first question the answer to


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MODERN MONEY-LENDING. 7the second will perhaps appear later on) I have a per-fect (legal) right to accept his offer. On this viewInterest is a gratitude. It is presumably a paymentmade by the borrower in return for some advantagehe derives from the money lent. It does not matterto me in a sense how he employs the money. Hemay merely squander it for his own amusement, or hemay employ it as capital to bring him in a profit. Ineither case he gives me what I consider sufficientsecurity for its repayment, and if he offers me 5 percent interest besides it is because the advantage isworth that to him ; and I have a perfect right toaccept it.

Besides, am I not by lending this money actually inthe second case benefiting society? Do I not putcapital into the hands of a man who is willing andable to employ it, and thus actually encourage andfurther production ? Nay more, I may go further, andwaiving my request for a security may subscribe myfunds directly to his concern, taking the risk andsharing some of the profits may become a share-holder in fact. In doing this do I not benefit mycountry, and may I not pocket my returns with a glowof substantial and generous satisfaction ? *Yes, I believe that it is possible that in the waysmentioned I may be useful to society ; and it seemsto me very, probable that, for instance, the Jew money-lender of the 1 3th and i4th centuries in England wasa very useful member of society. At that time, whencapital was scarce, and for the budding demands ofcommerce private individuals could often not supplysufficient funds, his services may have been indis-

* Under the term Money-lenders, I thus include both Bond andShareholders receivers of Interest and sharers of Profits. I amaware that current Political Economy draws a considerable distinc-tion between these two classes. But though for scientific purposessuch a distinction may be useful, yet practically, and as far asregards national advantage or social morality, I confess I do notsee that it is of much importance.


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8 MODERN MONEY-LENDING.pensable; and if he sometimes took undue advan-tage of his position, plentiful laws restrained him.How then can it be that the gains of the modernmoney-lender, whether bond or shareholder, if just,should lead to such disastrous conclusions as I havepointed out ? How can we reconcile the rightfulnessof interest with the immorality of a life of idleness, andthe meanness of a vast class supported by the excessiveand exhausting labour of the mass of the people ?

Is it possible that a practice which is wholesomeand useful to society in a moderate or small degreemay become highly dangerous when carried out on alarge scale; that the Jew money-lender in considera-tion of his services could in his time really be tolerated,but that the shareholder has become an insupportableOld Man of the Sea who must be torn off and got ridof at all costs ? Quite possible, I think ; though I willnot by any means say that this is the conclusion ofthe whole matter. Let us grub at it again.

Is it still not obvious that the poverty of the massof the people stands in direct relationship to thewealth of the money-lending classes, that they are thetwo opposite sides or faces, in fact, of the same thing ?Has that original illustration about the people on theisland grown dim by reason of some considerations bythe way which have been introduced ? Let it standout clear again. It cannot be got over.Where does Interest come from ? Have you everthought of that ?

If I lend 500 to a man, he may, as I have said,either squander it away or invest it as capital to bringhim in a profit. The first case need not detain uslong ; it is in the main an exceptional case. If theborrower squanders my money, I shall probably haveto sell him up to repay myself capital and interest; Ishall not lend to him again, and that game sooncomes to an end. The money-lending which consti-tutes the great problem of modern society is that which


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MODERN MONEY-LENDING. 9is connected in some way or other with Capital. Ilend my ^"500 to a man who employs it as capital insome concern, and the Interest which I receive comesout of the profits of that concern.But where does it come from ? Who pays it ? Howdoes the capitalist make his profit ?The capitalist buys raw material ; he employs labourto work it up into a finished article ; and he sells thefinished article. These are the three processes of hisbusiness, and in one (or more) of these processes hemust get more than he gives otherwise he can makeno profit That is quite clear, I think. He is aclothier. He buys cloth, employs men and women tocut and stitch it, and sells coats. The coat contains somuch cloth and so much added labour (including thelabour necessary to replace the wear and tear of thesewing machines). And the value of the coat is equalto the value of the cloth plus the value of the labourput into it.Where then does his profit come from? Not inthe buying and selling of the mere cloth obviously.For he buys at the market price and must in the longrun sell at the same. The profit comes to him in thebuying and selling of the labour which he employson the coat. How is that ? It is not difficult to see.He gives his young women two shillings (generallyless) for their day's work at the sewing machines.But the labour they put into the cloth is worth farmore than two shillings; and the extra value theCapitalist gets in the market for his coat (above thevalue of the cloth out of which it is made) is theactual value of the labour put into it, not the value ofthe wretched wage which he gives. Thus it is that hegets more than he gives.The process is simple enough. An article with saynine hours' a whole day's labour in it should fetchon the market an equivalent of nine hours' labour.This goes to the Capitalist. But does anyone for a*


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10 MODERN MONEY-LENDING.moment suppose that the two shillings that he givesto his workwoman is an equivalent, or anything likean equivalent, to her for that same nine hours ?What, if you please, in the way of the ordinarynecessaries of life does nine hours' labour represent ?Godwin, the author of " Political Justice," calculatedthat a man with ordinary labour, unhampered by therapacity of others, should be able in two hours dailyto supplyhimself with the necessaries and conveniencesof life. Bastiat, if I am not mistaken, mentions twoand a half hours. Karl Marx, whose calculations onCapital I am following, supposes six hours' labour perdiem necessary in order that a man may provide forhimself, a wife, and two children. Of course an exactestimate on this subject is difficult to make. So farhas society got from any simple and equitable relationbetween labour and its reward that we actually do notknow how much (or how little) labour. is requiredfor a man to support himself in health and comfort.But all authors agree that it is very small comparedwith the nine hours' daily slavery which constitute thebeginning and the end of a modern working man's life.The nine hours' labour* then which our sempstressor machinist puts into the article ought to representfor her a comfortable subsistence for several days. Itrepresents a bare living for one day. She ought toget say a value of 6s. for it. She receives 25. Thecapitalist pockets the difference. The wretched girlmakes him a present, or has to make him a present,of four days' work in the week. She gets the valueof her labour for two. And this is where profits, whereinterest, under our present social system, come from.The position of women in these matters is notori-ously bad, but that of the male labourers, skilled orunskilled, is little better. Marx calculates that theordinary cotton spinner makes a present to his master

* Twelve hours, with one and a half off for meals, is the moreusual day's work, I believe, in this department.


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12 MODERN MONEY-LENDING.shunters and signalmen, of station-masters and plate-layers, of driver, stoker, and guard ; there is the labourof those who replace the wear and tear of the line andof the rolling stock. All this labour and much morehas to be considered. When totted up it constitutesthe labour-value of the service rendered. What weexpect to get in exchange for the service is an equi-valent labour-value as expressed in money that is tosay, if we get ^5 for the service it may be supposedthat the labour necessary for the production of a pieceof gold, value ^5, is equivalent to the labour involvedin the transport of the said 20 truck-loads of coal.This is the basis of all just exchange. It is possiblehowever that we may get more than our labour-value.If we are secure from competition or have a monopolyof any kind, we may succeed in getting more than wegive simply because our customers cannot get theirtransport done at a less price through other channels.It is possible also that we may sometimes have to takeactually less than the labour-value of our servicesrendered. How we can do this and yet make a profitwe shall see presently.The obvious method, through all this, of securingdividends is to keep down wages.Let us take the three cases supposed. Let us firstassume that the price we can get for our servicerepresents exactly the just exchange that we receivea labour-value from our customer exactly equal to thatwhich we give him. How do we make our profits ?How must we make our profits? Obviously by givingour own servants and workmen less than the labour-value of what they do for us by giving them wageswhich do not represent their labour which are notan equivalent for it.Let us suppose, secondly, that the state of themarket forces us for the time being to accept from thecustomer actually less than the labour-value of theservice rendered; 'then obviously we are driven to


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MODERN MONEY-LENDING. 13lower still farther the wages of our servants, to dothem a more glaring injustice that is, if we can ; foron this depend our chances of a dividend.These two cases are, I take it, by far the mostcommon. An ordinary railway porter gets 173. aweek. He is on duty on an average loj hours a day ;one week, nights ; another week, days. He has everyother Sunday off. That is he works 13 days in thefortnight. Thirteen days for 343. Two shillings andeightpence a day. It is impossible for me to pretendthat I pay that man for his work. The labour-valuethat he gives me is far more than what is repre-sented by 23. 8d. per diem and I am living on thebalance that I draw from him.*

I can buy in the street six boxes of matches for apenny. The capitalist must sell them at considerablyless than that say nine boxes for a penny. It isdifficult for me to believe that the labour-valueinvolved in the making of nine boxes of matches isnot more than a penny. If so, this is a case in whichthe capitalist gets actually less value from the customerthan he gives. What then must he give to his ownworkmen ? This is a question which weighs upon mewhen I buy those six boxes. It is not a pleasant one; andI feel no desire any longer to glory in their cheapness.To return to my railway. The third case remainsunconsidered, in which I succeed in getting from mycustomer (for one reason or another) more than thevalue of the service rendered. When this happens I* In case the system of "tips" obnoxious both to donor and

recipient be brought forward as modifying these calculations(though not really affecting the main argument), let me quote thewages of another class of servants. Signalmen on the Midland lineget an average of 235. or 245. a week. One that I am thinking of,and whose case may be taken as a representative one, is on day dutyand night duty alternate weeks. His "days 1' are n hours long,his " nights " 13 hours. Every half-year if no negligence is reportedhe receives a bonus of .305. He has four days' holiday allowed in theyear, and alternate Sundays. An ordinary platelayer gets i8s. fora week of 58! hours exclusive of mealtime.


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14 MODERN MONEY-LENDING.certainly can pay my servants and workmen the fullvalue of their labour, and yet have a margin over formy own profit. And it would be useless to deny thatthis sometimes takes place. Workmen under thepresent system and with existing fluctuations in tradesometimes get in wages as much as (and even morethan) the full value of their labour. But this is alwaysan exceptional condition of affairs and does not lastlong. In such a case where do the profits of capitalcome from ? If I charge my passenger for transportinghim from Dover to London the full value of oneman's labour for a day, and the human labour actuallyinvolved in the transport (reckoning up everything)has been only equal to one man's labour for three-quarters of a day and I pay my servants justly forthat then I gain my profits clearly out of the passen-ger. I gain a quarter day's labour from him that is,I cause him (or if he does not work himself, whoeverworks for him) to work a whole day for a servicewhich only costs me (or my representatives) thelabour of three-quarters of a day.

Thus, once more, it appears that my profits come,and must come, from the labour of others. Theyarise, and can only arise, from the fact that someportion of the labour connected with my businessgoes unremunerated. The proper remuneration ofthat portion I pocket for myself, and that is how mydividends arise.*

* Any railway company's report will illustrate these remarks. Iquote the following figures from the accounts of the North-Easternfor the latter part of 1884. The total revenue for that half-year was3,299,000. This enormous sum was expended as follows :Wages (including salaries of officials), 1,078,000; purchase of

materials, law costs, taxes, &c., 689,000 ; and the balance,1,531,000 went almost entirely to the bond and share holders!That is, roughly speaking, one million sterling went to the workerswho carried on the line, and one million and a half to the idlers whoclaimed interest on their capital ; or, in other words, out of every

ten hours that the signalman, engine-driver, or other servant orofficial worked, he gave six hours for the benefit of the share andbond holder, and only had four for himself.


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MODERN MONEY-LENDING. 15That labour is the proper basis of exchangeablevalue is now assumed, I believe, by all PoliticalEconomists ; that it is the source of all that is generallytermed "Wealth" is obvious. It therefore needs no

detailed argument to prove that if a class lives withoutlabour, if it obtains wealth without working for itit must be appropriating the labour of others, and thewealth that rightfully belongs to them. And this isthe case, I fear, of the shareholder and of that vastclass in this nation who live on interest and dividends.

But, it may well be asked, if this appropriation isunjust, why does the worker submit to it ? Why doeshe allow a portion, and often a large portion, of hisdaily labour to go unremunerated?The answer is : Because he cannot help himself. Hesees and feels that it is unjust, but he is caught in the

jaws of a vice and cannot move.The matter lies in a nutshell. If the worker couldemploy himself, be his own Capitalist, then (and thenonly) could he get the full remuneration of his labour,for he would have no idle person to support inaddition to himself and

family.But in the existing

state of affairs he cannot become his own Capitalist.Why ? Because, of the two outlets of Capital agri-culture and industrial production one is barred byour land system, the other by machinery.In fact, if our workman, having saved up a littlecapital, proposes to buy a small piece of land andsupport himself upon it by his own labour and that ofhis family he finds himself at the very outset met bythe fact that he can hardly find such a piece of landto buy. The main portion of Great Britain is in thehands of a few thousand large owners. The quantityof land in the market is small, it is mostly in largeand cumbrous holdings, the price is prohibitive, andthe legal expenses and complications attending thetransfer are vexatious and costly, the resul; being thatin his own country the workman finds himself an exile,


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1 6 MODERN MONEY-LENDING.without a foot of soil which he can call his own, andunable to exert the labour which he longs to put intothe ground, without hiring himself out, becoming aslave, a dependent, and giving half the profits of histoil to someone else.

If, on the other hand, he desires to embark his smallsavings in some form of industrial production, and toemploy himself in that way, he finds that machineryforbids. For without machinery he cannot hope tocompete in the market And to acquire machineryand all that goes with it, he must lay out large sumsof money, and be a large Capitalist at once.

Thus, absolutely unable on the present system toemploy himself, the workman is thrown on the market

there to sell his labour to the Capitalist for what hecan get.Now we begin to perceive the operation of thosetwo deities, worshiped by Political EconomistsSupply and Demand. Think for a moment of thevast floating, fluctuating, tramping, toiling populationthat does the manual work of England to-day. " Inthe 1 5th century [I am quoting from Mr. Hyndman]a landless houseless family was almost unknown."What material for reflection lies in these words !Think of the vast patient toiling population of to-day,homeless, tramping from place to place, thrice blessedwhen it can get into some squalid corner of workshopor factory and be allowed to grind one eternal andmonotonous operation for nine hours a day ; rememberthat this population is so situated that it cannotemploy itself; and then think of the capitalist classroiling through the streets in its carriages, monopolis-ing the land and the instruments of production atwhose feet this working population has to kneel andbeg for employment. Is it not a mockery to talk ofSupply and Demand or if not a mockery, are thesetwo words so to rule us that all charity and humanpity, nay, that all honesty and the demands of eternal


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MODERN MONEY-LENDING. 17justice itself are to be set aside in their favour? TheDemand is a demand for bread, the Supply well,what is the supply ? What is it as a matter of fact,what is it likely to be, from a class in power to a classthat is forced to come and crouch at its feet ? Whathas it been all the world over from the tyrant to theslave ? A supply, alas ! of insults and mockery, ofchastisement and tears, and a crown of thorns placedupon the brow of despised and rejected Humanity.The supply (in wages) is and obviously must beunder the present system just sufficient to keep thelabourer going and, in the long run, no more. Ithink practically all .political economists admit this.That whatever fluctuations there may be owing to thestate of trade, whatever great accessions in the pro-duction of wealth owing to new and ever newmechanical inventions, in the end the wages of theworkmen do tend and must under the capitalist systemtend ever downwards to that minimum which justadmits of the support of the workman and the perpetua-tion of his race. Capital, in fact, is limited into thehands of the few, and Labour is at the mercy of thesefew as to whether it shall be employed or not. Thecountry may be full of Labour desiring to be employed,but if the capitalists do not see a way of turning it totheir profit it remains unemployed. The object of allproduction, in fact, is not the providing for the peopleor the supply of the wants of the nation but the profitof a small class. And if the small class is not profitedthe nation may starve ! That is the long and short of it.Nothing can illustrate this better than England atthe present time. The land is full of men, honestexcellent workmen, who hate idleness and desire work.Can anyone doubt that England would be a richerhappier country if they were employed ? If those menwere only turned out on the farm lands now in everycounty running to thistles and docks there to supportthemselves by their own labour the country would by


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1 8 MODERN MONEY-LENDING.that alone be millions of pounds richer. Yet thesemen roam the roads and with hungry eyes look overthe hedges at fields all going to waste, at badlydrained, uncared for, half-cultivated lands in vainbecause, forsooth ! the capitalist and landlord classesdo not find it suit their pockets to employ them. Thesame remark applies to industrial production. It isuseless to say that there is not ample work for theindustrial classes of England to do work which wouldand must be profitable to themselves and the nation.The real question is whether it suits the capitalistclasses to let them do it. But Lord Broadacre andMr. Moneybag find they can get 10 per cent for theirmoney in Mexican or Brazilian bonds, and it suits themvery well to let their capital go out of the countrysuits them better perhaps than employing the starvinglabourers in it. It matters not to them it mattersnot to the great shareholding, dividend-drawing, andrent-receiving classes of this country what the conditionis of the labouring masses from whom they draw theirwealth. As a matter of fact they know little or nothingabout it. I believe that thousands and thousands outof these classes would, if they only knew the facts ofthe case if they could only realise the monotonyand depression of the life of the mechanical wage-worker, the hopelessness of it, the bitter sense ofwrong as he is driven to beg for employment fromdoor to door if they could only for one moment withthe keen eye of justice see the honest relation betweenthemselves and this man who stands without in thecold see him as the true man and themselves asdependents would, I say, if not out of pity out ofvery pride abandon their mode of life and rest nomore till they had made some reparation. But for themost part, lapped in luxury and ease from their child-hood onwards, ignorant of the real facts of life,nursed among absurd and impossible ideals, andflattered by class views and interests, living in houses


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2O MODERN MONEY-LENDING.talk of any kind of right at all except that whichcomes of force.Think once more of our island. There are two

parties on it. One party possesses all the land (bestnot inquire how it got it ! ) and all the tools andimplements of industry; the other party possessesnothing. This second party has to do all the labour.Of the fruits of its labour just enough is awarded to itto keep it alive and fit for work, the rest is claimedby the first party (under the names of rent, interest,profit, &c.) as a reward for its kindness in allowing thelabourers to use its land and tools !Why does the second party submit to anything soabsurd? Simply because it is the most patient,

broad-backed, good-humoured, simple, honest creatureimaginable, and has never fairly opened its eyes to seethrough the juggle imposed upon it But that flamcannot last long now. The day of "the rule of classgreed and wealth is almost at an end. The workersare waking up in England and all over Europe to theirtrue position. In a few, very few, years, theantagonism will be declared on both sides. Perhapsin England the very next great crisis will bring anopen declaration of war if not (as may be hoped)actual conflict.

But before coming to anything so practical as aconsideration of what has to be done in view of thishuge and impending struggle, let me meet one objec-tion to my general argument which just now occursto me.It is said that a state of society which only providesfor manual labour and the physical wants of men isdisastrous to all higher life and in every way far fromdesirable ; and that to deprive men of the chance ofliving in " independence " (as it is called) would be todeprive the world of the services of many greatthinkers, artists, philanthropists, and benefactors ofthe human race. Let me say first, and in passing as


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MODERN MONEY-LENDING. 21it were, that if mere justice were done to the humanmasses at large they would not stand in need of somany philanthropists and benefactors ! and thatinjustice can never in the nature of things grow agreater crop of human welfare and felicity than justice.Secondly, let me say that there is nothing to preventsociety from recognising and paying the labour of theartist, the judge, and the thinker even, as much as itrecognises and rewards the labour of the mason andthe quarryman; but that this would form no reasonfor maintaining a vast number of people in abjectuselessness and idleness besides. Thirdly, let me saythat the production of the necessaries of life is still themost important and the foundation element of nationallife, and that in our present England it is both inhonour and in actual pursuit dangerously neglected infavour of the innumerable fancy-work with which it isoverlaid. Fourthly, do not let us forget the manifoldevils which arise from this so-called " independence"the waste of life, and its good things, the ennui, unbelief,and ill-health do not let us forget that this "inde-pendent " class is responsible for the creation of otherclasses such as lawyers, domestic servants, doctorswho if not idle are themselves next to useless to thecommunity, and therefore a burden upon it ; andFifthly, and most important of all, let me remind thereader that if the capitalist class were abolished anda fair share of work at the necessaries of life done byall parties in the nation the average work so requiredwould be only about three hours a day, perhaps less,thus leaving ample time in the remaining hours forother, pursuits, and probably causing developments onthe intellectual and artistic sides of civilisationhitherto unprecedented and undreamt of.To proceed now with a consideration of what hasto be done in the immediate future to meet the comingchanges. The People are demanding, and will withrapidly increasing loudness demand, that the land of


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22 MODERN MONEY-LENDING.this country and the instruments ot production (mean-ing thereby Capital) shall be put once more into thehands of the producers. Under various names, asNationalisation of the land, Nationalisation of Capital,Co-operation, Socialism, &c., they will practicallydemand one thing namely, that the workers shalldirectly inherit the fruits of their work, and shall notbe mulcted by secondary classes intervening between.The capitalist classes (as a body) will resist thisdemand ; and there will be more or less open war fora considerable period, ending at last no doubt in thedefeat of the capitalists. The end cannot really Ithink be doubtful, but the length of the struggle andthe violence of it may depend on a variety of causes.It seems to me in the last degree improbable that anygreat proportion of the capitalist classes will admitthe justice of or yield to the demands of the People ;on the contrary, they will organise resistance ; and thePeople will organise attack. And it is only too pro-bable that antagonism will embitter and exaggeratethe sense of wrong on both sides. Some few, however,among the capitalist classes will discern the substantialjustice of the popular claims, and will have boldnessto act up to their convictions ; and on the action ofthese it may greatly depend whether the struggle beultimately referred to the arbitrament of reason or offorce.

In face of the rapidly spreading views (partlyexplained above) on the nature of rent, interest, andprofits, the present attitude of the more well-meaningamong the Capitalist classes towards the People seemsvery inadequate and indeed out of place. It is notpatronage and kindly condescension that are required,but mere justice. From the person who has takenfrom you a large proportion of the fruits of your labourit is not agreeable to receive small doles to keep youfrom starvation. Charity organisations and unpaidmagistracies and the current philanthropic schemes


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MODERN MONEY-LENDING. 23indicate a benevolent intention on the part of thosewho promote them, but they also indicate an entiremisconception as to where the root of the evil lies,and an incapability of realising the way in which thepeople themselves regard these attempts to remedy it.On the other hand, perhaps the workers hardlyrealise how difficult it is for one of the dividend-receiving classes to extricate himself, when he findshis mistake, from the false position into which he hasunconsciously got. Trained to no kind of manualwork, perhaps to no useful work at all (for of howlittle real use to the community is the greater part ofthe work at present done in the select professions ! ),trained perhaps to no work of any kind, useful orunuseful, he (or she) finds it difficult to satisfy thedesire now arising for an honest and faithful life. Andindeed, the whole state of society around being dis-honest and unfaithful, it is difficult for anyone tosatisfy that desire.Yet there are certain lines along which such aperson may work with satisfaction and which I mayperhaps try to indicate. In the first place (and perhapsthis is as a rule the best plan), remaining in that placeor profession in which they are, they may try to maketheir work in it entirely honest and open, and as usefulto others as possible, especially the poor. This willof course involve losses, monetary and otherwise, andridicule. But nothing else can be expected or needbe wished for. In the second place, to make thiscourse of life feasible and to gradually gain indepen-dence from dividends, it will be necessary to reduceexpenses greatly, and to adopt a very simple mode oflife. The current mode of life among the capitalistpeople is so needlessly expensive and complex, thatfew of them, even the more economical, realise howeasily it can be simplified, and with how much advan-tage to health and happiness. But really nowadaysthe adornments of life, as for instance, literature,


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24 MODERN MONEY-LENDING.music, art, travel even, are so cheap that very little,after the necessaries have been provided for, isrequired for the satisfaction of mental wants. A greatdeal of ignorance no doubt exists among so-called well-to-do people about proper food (a matter in whichhumble country folk are far better instructed) and agreat deal of unnecessary expense incurred in thisitem; but I have not the least doubt and I am notspeaking at random in this matter that with ^120 ayear a man with a wife willing to do a fair share ofwork (and both of them free from any desire to makea pretence of grandeur for this lies very much at theroot of the matter) could bring up a little family inhealth and happiness all taking their part in house-hold life and with education, culture, and refine-ment equal to any in the land. But such a change asthis, or in this direction, at all generally adopted,would enormously alter the aspect of the nation, andbring us nearer to that ideal of social love, justice, andhealth from which we have so far strayed.

I dwell on these personal reforms first, becausesurely to each individual they must come firstbefore any more wide-reaching sphere of usefulnesscan be reached. Any capitalist or shareholding sortof person who carried out this plan of living wouldprobably after a time find that he (or she) had a con-siderable balance at the bank to dispose of. Hewould then have to consider what to do with it. Andhe would find himself much nearer than before to apractical realisation of the advice which Jesus gave tothe young man with great possessions.Without attempting to limit the directions in whichsuch a person might with his money try to benefitthe mass of the People, as in some sort of reparationfor having taken it from them, I would suggest that atpresent the great need of the People (as mentionedabove) is to get capital into their own hands for thepurpose of employing their own labour, This can only


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MODERN MONEY-LENDING. 25be done by Co-operation, either on a small scale, orby the nation at large. Anything therefore which willfurther Cooperation, either by the founding of pro-ductive societies, or by a dissemination of ideas onthe subject, will I think be especially useful Further-more, and beyond this kind ot" Co-operation, somethingof the nature of National Co-operation is to be aimedat This practically, and dropping details, meansSocialism, which I take it is simply the substitution ofthe rule of general advantage for the rule of individualgreed, as represented by Capitalism. The wordSocialism has an unpleasant flavour about it Likeevery new word or idea which comes into the world,it carries with it something repugnant and offensive ;and those who view it from the outside take it to meanconfusion, destruction, and disorder. But those whoview it from witnin see that it really means order andlaw far more than the system it is destined to replace.Indeed, if anything, the danger of Socialism and onethat will h^e to be guarded against will be its repre-senting too much order and law, and so being inimicalto individual eccentricity and development

Behind this word, and giving it authority, standsthe huge personality of Democracy, the rule of themass of the people their interests rather than theinterests of the aristocratic or commercial classes.To many serious and thoughtful folk this rule seemsfull of danger. To them it appears that the workingclasses, whatever virtues they may have, are essentiallydisorderly, turbulent, clamorous, and disregardful ofrights and that cherefore (as undoubtedly would bethe case it this were true) they are and always mustbe unfit either directly or through representativesto be the practical rulers of society. I believe myself,however, that this is a complete mistake a mistakedue to ignorance, and to hasty generalisation of thoseisolated occasions when the people have hithertoforced themselves into notice like volcanic lava


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26 MODERN MONEY-LENDING.through the upper crust of society's indifference andrepression. It happens to me to have had perhapsexceptional opportunities of knowing the various mainstrata of English social life the fashionable, theintellectual, the commercial classes, and the proletariat.I may say I have spent several years in each stratumand mixed freely and wellnigh exclusively in each casewith those belonging to it and without dogmatisingon the matter, my decided opinion is that the morestable section of the working masses is the real back-bone of the nation. My opinion is that this class (ifit can be called a class) is in sound sense, orderliness,affectionateness, and wholesome instinct, moral andphysical, far superior to the rest of the nation ; that inintellect, if not equal to the detailed work of thescientific people, it has a plain strong mastery derivedfrom its contact with the actual facts of life, which ismost if not more important ; and that in dealing withmoral and political problems it uses a broad sense andtact which often lead it to just conclusions when pro-fessional politicians and moralists are flounderingamong expediencies and casuistries.Of course the same old blood runs everywhere ; andin all sections of social life, as far as I can see, youfind the same characters, and differences of character,temperament, passion, and intellect But undoubtedlythe habits of life of each class give a special cast andexpression to the average underlying humanity. Thefashionable, the intellectual, and the commercial classesare each narrowed down in their different ways andalong their own lines ; that great class which lives indirect contact with Nature and the actual facts of lifeseems to me (notwithstanding the specially trying cir-cumstances of its life in the present day) to be by farthe least narrowed, to be by far the most human ; andI shall always be thankful that I have come to knowit, as I have done, and to learn some of the bestlessons of my life from it.


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MODERN MONEY-LENDING. 2^I do not think therefore that in contemplating thechanges that are coming upon society, the changefrom the rule of Capital to the rule of Labour, from

Plutocracy to Democracy, from Constitutionalism toSocialism or whatever you like to call it we needbe alarmed about the upshot or imagine that chaos isbefore us. For my part I hail the oncoming of thischange, and believe that, through whatever struggleand suffering for the time, it will end in the estab-lishment of a far nobler freer life in the land and in abroader overshadowing of the wings of justice and ofpeace.

JOHN HEYWOOD, Excelsior Steam Printing and Bookbinding Works,Hulme Hall Road, Manchester.


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BY THE SAME AUTHOR.TOWARDS DEMOCRACY. New edition, with numerous

added Poems, crown 8vo, cloth, 260 pp. Price 2s. 6d.

MODERN SCIENCE : a Criticism. Crown 8vo, paper, 76 pp.Price Is.

DESIRABLE MANSIONS. A Pamphlet. Price Id.CO-OPERATIVE PRODUCTION. Price Id.ENGLAND'S IDEAL. Price 2d.

To be had of the Publisher,JOHN HEYWOOD, DEANSOATE AND RIDGBFIELD, MANCHESTER ; AND

11, PATEBNOSTEB BUILDINGS, LONDON.


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Mil! Illl Mill II Hill Mill Mill Illll Illll Mill HillA 000105514


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modern money-lending and the meaning of dividends : a tract (1885) by carpenter edward

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