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diff --git a/old/56018-0.txt b/old/56018-0.txt deleted file mode 100644 index 2a05113..0000000 --- a/old/56018-0.txt +++ /dev/null @@ -1,18029 +0,0 @@ -The Project Gutenberg eBook, Business Administration, by Various, Edited -by Walter D. (Walter Dwight) Moody and Samuel MacClintock - - -This eBook is for the use of anyone anywhere in the United States and most -other parts of the world at no cost and with almost no restrictions -whatsoever. You may copy it, give it away or re-use it under the terms of -the Project Gutenberg License included with this eBook or online at -www.gutenberg.org. If you are not located in the United States, you'll have -to check the laws of the country where you are located before using this ebook. - - - - -Title: Business Administration - Theory, Practice and Application - - -Author: Various - -Editor: Walter D. (Walter Dwight) Moody and Samuel MacClintock - -Release Date: November 21, 2017 [eBook #56018] - -Language: English - -Character set encoding: UTF-8 - - -***START OF THE PROJECT GUTENBERG EBOOK BUSINESS ADMINISTRATION*** - - -E-text prepared by Juliet Sutherland, Carol Brown, and the Online -Distributed Proofreading Team (http://www.pgdp.net) - - - -Note: Project Gutenberg also has an HTML version of this - file which includes the original illustrations. - See 56018-h.htm or 56018-h.zip: - (http://www.gutenberg.org/files/56018/56018-h/56018-h.htm) - or - (http://www.gutenberg.org/files/56018/56018-h.zip) - - -Transcriber’s note: - - Words and phrases in italics are surrounded by underscores, - _like this_. - - Subscripted numbers in chemical formulas, page 347, are - presented within curly braces, preceded by an underscore, - for example: C_{6}H_{3}OHOCH_{3}CHO. - - Page numbers are displayed in the right margin. - - - - - -BUSINESS ADMINISTRATION - - - * * * * * * - - BUSINESS ADMINISTRATION - TEXT BOOKS - - Business Economics. - Business Organization and Management. - Advertising and Salesmanship. - Trade and Commerce. - Transportation. - Money, Banking and Insurance. - Investments and Speculation. - Accounting. - Auditing and Cost Accounting. - Business Law and Legal Forms. - - * * * * * * - - -BUSINESS ADMINISTRATION - -Theory, Practice and Application - -Editor-In-Chief - -WALTER D. MOODY - -General Manager, The Chicago Association of Commerce, -Author, “Men Who Sell Things.” - -Managing Editor - -SAMUEL MACCLINTOCK, PH. D. - -Editorial and Educational Director, -La Salle Extension University - -This work is especially designed to meet the practical every-day -needs of the active business man, and contains the fundamental and -basic principles upon which a successful business is founded, -conducted and maintained. To those looking forward to a business -career, this work forms the basis for a practical and systematic -course in “Business Administration” - - - - - - -Published by -La Salle Extension University -Chicago - -Copyright, 1910, -Lasalle Extension University. - - - - -BUSINESS ECONOMICS - - -¶ This treatise has been especially prepared by E. L. Bogart, Ph. D., -Associate Professor of Economics, University of Illinois, and Author -of Economic History of the United States; Hon. O. P. Austin, Chief of -Bureau of Statistics, Department of Commerce and Labor; and John -Bascom, D. D., LL. D., former President University of Wisconsin. It is -supplemented by the writings of recognized experts in the production, -preservation and distribution of wealth. The treatment is modern, -popular and authoritative. The volume contains many timely and -practical suggestions which can be applied with profit to any -business. It is also arranged to serve as a quick reference work, and -includes a complete table of contents, a comprehensive index and test -questions. - - WALTER D. MOODY, - Editor-in-Chief. - - - - -INTRODUCTION TO BUSINESS ADMINISTRATION. - -BY WALTER D. MOODY. - -General Manager, The Chicago Association of Commerce. - -Author of “Men Who Sell Things.” - -“_The recipe for perpetual ignorance is: Be satisfied with your own -opinion and content with your knowledge._” - - -[Sidenote: Business a contest of wits] - -This is an era of the greatest commercial activity the world has ever -known. The development of business is one of the marvels of the new -century. A few years ago science, as a factor in commerce, was little -known and less appreciated. The amazing advantages to business of -intellectual attainments were utterly without recognition. Today, -however, business has become a contest in which the quickest -perception wins, thus transforming the counting room into a battle -ground upon which brain matches brain for supremacy and success. - -[Sidenote: Success-educated enthusiasm] - -Ah, that enchanting word, S-U-C-C-E-S-S. It does not require a magic -key to unlock the door to business efficiency. There is nothing -mystic, nothing mysterious in the applied method of the really -resourceful men in this day of great successes, of marvelous -achievements in business enterprise. The sum total is contained in two -words, words that electrify, nevertheless. EDUCATED ENTHUSIASM. - -[Sidenote: Changing conditions make opportunities] - -The most formidable barrier to progress has always been the senseless -opposition of those to whom it would be of the greatest benefit. -Changing conditions are the order of the day, for enlightenment has -worked wonders. In olden times, a man of affairs was obliged to guard -his property and his loved ones by building a moat around his house -and posting sentinels in and around his estate. The time is not long -past when, because of prejudice, perversity or ignorance, many men -believed that opportunity knocked only once at any man’s door. Today, -thanks to deeper insight, most men believe that life itself is -opportunity; that the very air we breathe is opportunity; that each -new day presents broader opportunities for accomplishing more because -of better directed energy. This is not alone the accepted dogma of the -man who is making his way in the world. It is the creed, doctrine, -tenet or religion, whichever you may care to term it, of the great -captains of industry everywhere. - -[Sidenote: New ideas count] - -The more successful the man, the more does he think, study, plan, as a -part of his daily occupation in the development of the affairs in -which he is interested. Newer and better ways to get things done is -the business standard employed today by successful men in all lines. -Only yesterday if a man of genius advanced a new idea, he found -himself ridiculed and his innovation opposed on all sides because it -was a new idea. Today, it is different. The man of ideas counts in the -trend of affairs as he has never counted before. - -[Sidenote: Must keep step with changing times] - -Everything has a subjective reason. Progress is acting as a mighty -dynamic force in changing men’s viewpoint of life and things. Suppose -the stroke oar on a varsity crew, while in a race against an opposing -crew from a competitive institution, should suddenly stop rowing in -harmony with his associates and begin to row backwards-that crew -would not get very far without trouble. Suppose a lawn mower should be -reversed and forced to run backwards--there would not be much progress -made in cutting grass on that lawn. Varsity crews and lawn mowers must -move forward. Business men must advance with the times. - -A great merchant in Chicago tells a good story of his youth. He was a -member of a state regiment of militia. On a certain occasion, his -company was sent out on dress parade. An old maiden aunt, with -considerable colonial blood in her veins, took much pride in her -nephew and his company. While reviewing the parade, she was suddenly -heard to exclaim: “Why, every single man in that company is out of -step excepting my nephew.” Most men who fail to get on in the world do -not realize that success lies in keeping step--in making progress with -changing conditions. They generally make the mistake of thinking that -the world and everything in it is out of harmony with themselves. - -[Sidenote: New ideas worth searching for] - -A business man of successful experience realizes that ideas--newer and -better principles of conducting business--are of the greatest value, -and he also knows that it pays him to search for them. The same old -way of doing things cannot longer be successfully employed month after -month and year after year as under the old regime. The business man -must be modern, up-to-date. The physician or lawyer finds that to -compete successfully he is compelled to search without ceasing in -order that he may comprehend the advancement in treatments or -procedures. “To the man who fails belong the excuses.” - -[Sidenote: Demand for trained men] - -President James, of the University of Illinois, was asked if there was -any demand from business houses for college-bred men. His reply was: -“The demand has been far in excess of the supply since courses in -business administration were established in our institution seven -years ago. Each year has brought many more requests than we have men -to recommend.” Ten years ago President James would have been ridiculed -for advancing this new idea for the establishment of a school of -commerce in connection with a university. Today, commercial schools -are a part of the regularly established courses of nearly all of the -great universities of our country. Men trained in the theory, practice -and administration of business will always occupy the best positions -and will always command the greatest salaries. - -[Sidenote: Value of new ideas in business emergencies] - -All men fail at times in the accomplishment of satisfactory results in -the various enterprises in which they are engaged, without being able -to give an explanation. The principles that have been applied -successfully for many years seem apparently to have counted for -nothing. It is frequently evident that in such cases a very -insignificant thing, a mere oversight perchance, has been the direct -cause of the failure. To be able to put the finger on the precise -cause of the lack of success in one’s method would locate the cause of -the disaster. Then it is that a real appreciation of new ideas is -fully realized. - -[Sidenote: Men paid for what they know--not for what they do] - -Failure is more often chargeable to a refusal to learn by mistakes how -to avoid them than it is in making them. Experience is a good teacher, -but who can deny the value to be gained in learning from the -experience of others, for we cannot all have the same experience or -the same view of similar experiences. There are many pathways to -success, but the road of individual experience is narrow and rugged. -It is a commonly accepted fact that for every ten dollars a -high-salaried man draws, he receives nine dollars for what he knows -and one dollar for what he does. On the same basis the successful -business man, employing a large force of other men, realizes that his -own greatest worth, as applied to his affairs, lies not so much in -what he can do himself as how much he can encourage his employes to -do. In either case, his own personal knowledge is the power behind the -throne. - -[Sidenote: Knowledge in excess of present needs necessary] - -The man who would secure the largest net return from his individual -effort in the field of endeavor, and he who would realize the greatest -possible advantage from the efforts of those under his command must, -of necessity, possess knowledge--indispensable perception far in -excess of the needs of the moment. Discernment, like a bank account, -soon runs out if it is overdrawn or if it is not continually -replenished. In business the “checking system” of knowledge is the -sort of account that pays best--not the “savings account system.” -Knowledge that is simply corked up and allowed to accumulate cobwebs -and rust can avail nothing. The sharpest vinegar is procured by -constantly replenishing the old stock with new. - -[Sidenote: 90% failures vs. 10% moneymakers] - -Reliable statistics prove that only about ten per cent of all people -who engage in business are successful and make money; the other ninety -per cent become insolvent and fail. That is, they do not actually -encounter the sheriff, or go into the hands of a receiver, but they -fail nevertheless to succeed in the sense of making money, and what -other possible reason can anyone have for engaging in business if not -to accumulate money? - -[Sidenote: Failures due to lack of intellectual capacity] - -Why do so many fail? Ask any credit man and he will tell you that it -is not because of the lack of capital, or other material resources, -but it is due primarily to a lack of intellectual capacity, the sort -of brains that dig and work and sweat until they find a way to -accomplish things; brains that go to the bottom of things; brains that -are always looking for better results; brains that never abandon a -problem until they have found a way to solve it. A friend once told me -that he inquired of the manager of a house employing some three -hundred traveling men how many salesmen they had. The manager replied, -“Three.” My friend asked, “How’s that? I am told your force of -traveling men numbers nearly three hundred.” “Ah, that is quite -different,” replied the manager; “we have two hundred and ninety-seven -traveling men, but only three salesmen.” Quite likely that manager’s -estimate was intended to be taken figuratively rather than literally, -but it serves to illustrate the fact that in this great United States -there are millions of men, young, middle-aged and old, who are content -to plod along in a mediocre sort of way, heedless or unmindful of the -fact that opportunity, knowledge, possibilities, are calling, calling, -calling to them to come up higher. There are hundreds of thousands of -other men engaged in business who sit idly by while their trade, like -the sands in the hour glass, slowly ebbs away, and eventually is -absorbed by their more progressive business neighbors. - -[Sidenote: Moneymaking and business literature] - -There is still another vast army of business men--salesmen, clerks and -wage-earners of all classes--who are beginning to catch a glimpse of -the dawning of a new business era, the greatest the world has ever -known, an era impregnated with possibilities and opportunities for -those who are ready with wicks trimmed and oil in their lamps. To the -earnest latter class which is really desirous of profiting by the -experience of others, there is no need of elaborating the -possibilities embodied in this course of reading in Business -Administration. This set of books, containing valuable business data -on many subjects, thousands of pages telling the story of success -illustrated by trained men whose names are respected everywhere, is -intended to reach all classes. There is absolutely nothing in print -that can even approach or can begin to compare with it in value as a -reference library for business men or excel it as a complete course of -instruction for any man desirous of making the best of his -possibilities and opportunities in the kaleidoscopic age through which -the business world is now moving. - -[Sidenote: Practical ideas best] - -The more practical the ideas, the better the basis for good work. Not -long since, business men generally pooh-poohed the idea of employing -in the conduct of their business anything new, which was taken from -the writings and experience of others, such as is contained in this -remarkable series, contributed to by some of the brightest minds in -the business world today. There is, however, in these days -unmistakably a hungering and thirsting for just this new sort of -literature. It fills a long-felt need--fills it exactly, completely, -satisfactorily. Being the author of a work on salesmanship which has -had a countrywide circulation, I have been literally besieged by -business men everywhere asking me to recommend books treating of -successful business methods, and have been chagrined to find how -limited was the supply. The man who formerly was prejudiced against -such sources of information must now step aside and make way for -progress or unite with the popular demand for more education and -better methods. - -[Sidenote: Cannot afford vs. can afford] - -Show me the man who says he has no patience for such things, and I -will show you a man, like the stroke oar and the lawn mower, who does -not believe in moving forward in progress. Show me the man who says he -has no time to read of new methods and principles, and I will show you -the one who utterly fails to perceive that familiarity with business -literature of this kind means pecuniary advancement. Show me the man -who says he cannot afford to invest in such a set of books, and I will -show you one who apparently CAN afford to waste his energy in -misdirected effort--that energy and effort which are to every -wage-earner and tradesman both his stock in trade and his invested -capital. - -[Sidenote: Failures unnecessary] - -Someone has said, “There are three kinds of people in the world--the -Can’ts, the Won’ts and the Wills. The first fail at everything; the -second oppose everything; the third succeed at everything.” I would -add a fourth kind--the largest class of all--the Don’t Trys, the -“Oh-what’s-the-use,” “It-doesn’t-interest-me” sort of people. Their -name is legion; their fault is lack of confidence. Knowledge is the -greatest inspiration of confidence to be found on earth. You may not -personally be held in the hope-paralyzing bondage that produces the -“Oh-what’s-the-use,” or “I’m-not-interested” germ, but if you are not, -you are exceptional. Most people are, and that is the reason that such -persons are just about what luck, good fortune or chance make them, -succeeding if fortune favors them, failing if they are left to depend -upon their own resources. Result: Nine fail where one succeeds. - -It is very fortunate, indeed, for most men that so much of their -happiness depends upon success. There is nothing on earth quite so -terrible to think of as failure, especially that due to lack of -effort, unless possibly it be the failure of a man who lacks the -courage or initiative to try to make the most of himself, and thus -lets his best opportunities escape him. And this last is really the -most pitiful thing that can befall a man. It is well enough to plan -opportunities, but if we had the wisdom to take advantage of such -opportunities as naturally come to us, results would more often be -found in the balance on the right side of the ledger. And so I am of -the opinion that a clear explanation of why a very large class of -people do not succeed is found in some of these expressions--“I don’t -care,” “I can’t,” “It doesn’t interest me,” or “Oh, what’s the use.” - -[Sidenote: Basis of all business success] - -One of the great objects set forth in this Business Administration -series is to supply the positive energy which begets courage, -confidence, initiative and success. We want to make you feel the -necessity of doing some reading, a little plain thinking, and to make -as clear as possible the important things that are involved in the -serious but very fine game of business. - -With business becoming with each succeeding day more and more of a -science, it is high time to understand what is essential to it. -Speaking of the subject of “Organized Business,” a great authority -recently said, “It is time even for business men to understand -business.” Again, the purpose of this course in Business -Administration is, if possible, to measure the power and principles of -business, to trace their ramifications, define their elements, get -hold of their vital fundamentals, and so comprehend them, both in -technical detail and as a mighty unit. And I am confident we have done -all this. I find that at the foundation, the machinery of business is -simple, but whether it is plain or complicated, all who would succeed -must make every effort to comprehend it thoroughly. All I care to -emphasize at present is the great truth that knowledge, established -and classified, is the basis of all business success. This is clearly -established in this course of reading, and I am trying to incite your -imagination in writing of its merits just as I would endeavor to -enable you to realize it if I could talk to you personally right -across my desk. The observant man can see clearly the things I am -talking about, but to most men the mind’s eye perceives not by -observation, but only when the imagination is stimulated. So I would -stir all men to look earnestly into these things, with a view to their -personal betterment. - -[Sidenote: Business axioms simple to understand] - -Business is far more than business as it is commonly understood. It is -a science, and it is the eager, practical minds of business men that -we shall endeavor to convince first of that fact, and our reasons for -addressing those principally concerned are especially good. Why? I -have found that in writing about business whenever I was able to make -the principles so plain that business men understood them, everybody -else did, so it is to be expected that if business axioms can be made -simple enough for business men to understand them, everyone will -apprehend them. Everybody. And it is everybody that we are attempting -to reach. - -[Sidenote: Knowledge is power] - -For nearly thirty centuries men have recognized the concrete wisdom of -Solomon’s proverb: “A wise man is strong; yea, a man of knowledge -increaseth in strength.” Yet we have been slow in making its -application universal to the race. But we are beginning to understand -that the power inherent in knowledge applies as well to commercial and -industrial as to scholastic, political and social life, as well to the -counting room as to the pulpit, as well to the shop as to the -university, as well to the farm as to the bar. Knowledge is power and -is the only source of real intellectual sovereignty that the Creator -has ever entrusted to men. - -In conclusion, I would say that these words are addressed to the -business men of America, and this designation includes the banker and -his clerks, the farmer and his sons, the lawyer and the law student, -the financier and the man who sells bonds and stocks, the merchant and -his clerk, the accountant and the bookkeeper, the manager and his -assistants--the ambitious young men of the Twentieth Century type, -contemplating the pursuit of any business, trade or occupation. - - - - - CONTENTS - - - BUSINESS ECONOMICS. - - - Practical Economics. - - By ERNEST LUDLOW BOGART 1 - - I. THE MODERN INDUSTRIAL SYSTEM-- 1 - The English Manor--Institution of Private Property-- - Competition Defined--Development of Industrial - Liberty--Domestic System of Industry--Factory System - of Industry--The State as a Regulator of Industrial - Undertakings. - - II. THE AGRICULTURAL RESOURCES OF THE UNITED STATES-- 9 - The Land Policy of the United States--Irrigation-- - Dry-Farming--Farm Ownership--Decline of the - Agricultural Population--Character of Agriculture in - the United States--Forest Resources--Fisheries. - - III. THE MINERAL RESOURCES OF THE UNITED STATES-- 19 - The Problem Connected with our Mineral Resources--Steps - Taken to Remedy the Evil--Coal--Petroleum--Iron--Precious - Metals--Copper--Water Power and Its Use. - - IV. CAPITALISTIC PRODUCTION-- 29 - The Rapid Industrial Development and Its Causes--Factory - Defined--Division of Labor--Use of Labor-Saving - Machinery--Specialization and Localization of - Industry--Large-Scale Production--System of - Standardization. - - V. TRUSTS AND MONOPOLIES-- 39 - Phases of Combination for Fixing Prices--Classes of - Industrial Establishments--The Trust - Movement--Causes and Effects of Industrial - Combinations--Evils of Combination--Legislative - Regulation. - - VI. SPECULATION AND CRISES-- 51 - Risks of Modern Business--Function of the Speculator-- - Legitimate and Illegitimate Speculation--The - Occasion of a Crisis--“Hard Times”--Theories as to - the Causes of Crises. - - VII. THE MODERN WAGE SYSTEM-- 60 - Beneficial Results of the Factory System--Abuses of - the Factory System--The Existence of a Wage-Earning - Class--The Wage System--Historical Systems of - Labor--Modifications of Individualism--The Bargain - Between the Employer and the Laborer--Necessity of - Protective Legislation. - - VIII. LABOR ORGANIZATIONS AND COLLECTIVE BARGAINING-- 68 - Growth of Labor Organizations in the United - States--Knights of Labor--American Federation of - Labor--Objects and Methods of Labor Organizations-- - Restrictions Limiting the Output of Labor--Collective - Bargaining--Boards of Conciliation and Arbitration. - - IX. WOMEN AND CHILDREN AT WORK-- 80 - Evils of Early Factory System--Expansion of Woman - Labor--Why Women are Paid Lower Wages than Men-- - Desirability of Employment of Women--Child Labor-- - Labor Legislation. - - X. UNEMPLOYMENT AND INSURANCE-- 90 - Number of Unemployed in Modern Industry--Classification - of the Unemployed--Causes of Unemployment--Insurance - against Accident, Sickness and Old Age in the United - States; in Germany. - - XI. MACHINERY AND INDUSTRIAL EFFICIENCY-- 101 - Evils of Machinery--Labor’s Complaint against - Machinery--Industrial Education in Germany; in - England; in the United States--Aids to Industrial - Development in the United States. - - XII. PROFIT-SHARING AND CO-OPERATION-- 110 - Methods of Profit-Sharing--Economic Theory of - Profit-Sharing--Objections against Profit-Sharing - --Experiments in Profit-Sharing--Co-Operation--The - Rochdale Society--Producers’ Co-Operation--Advantages - and Defects of Co-Operation. - - XIII. PROBLEMS OF DISTRIBUTION-- 119 - Functional Distribution--Personal Distribution--Forms - of Distribution Proposed--Questions Connected with - Functional Distribution; with Personal Distribution. - - XIV. SAVING AND SPENDING-- 127 - Expenditures for Different Purposes--Relation Between - Saving and Spending--Desirability of Work for its Own - Sake--Problem of Luxury--Economy in Consumption-- - Economic Evils of Intemperance. - - XV. MONEY AND BANKING-- 137 - What Determines the Value of Money--Bimetallism-- - Monometallism--Government Paper Money--Kinds of Money - in the United States--Problems of the Banking System - of the United States. - - XVI. TRANSPORTATION AND COMMUNICATION-- 145 - Consolidation in the Railroad World--Question of - Railroad Rates--The Public Nature of Railroads-- - Ownership of Railroads--Electric Interurban - Railways--Express Companies--The Telephone--The - Telegraph--Inland and Ocean Water Transportation--Our - Canal System--Our Merchant Marine. - - XVII. TAXATION AND TARIFF-- 154 - Consequences of Taxation--Adam Smith’s Rules of - Taxation--Problems of Taxation--Sources of Revenue in - the United States--The General Property - Tax--Inheritance Taxes--The Question of the Tariff. - - XVIII. THE FUNCTIONS OF GOVERNMENT-- 163 - Functions of a Modern State--Anarchism--Individualism-- - Modified Individualism--Culture State Theory--State - Socialism--Socialism--Municipalization of Local - Public Utilities. - - XIX. ECONOMIC PROGRESS-- 172 - Improvement in Rate of Wages and Hours or Labor-- - Advances in the Field of Production--Reasons Why - Labor has not Profited More by the Great Increase in - Wealth--Reduction in the Cost of Semi-Luxuries--Lines - Along Which Reform is Needed. - - - Manufacturing. - By O. P. AUSTIN 179 - - INTRODUCTION-- 179 - The Hand Method of Manufacturing--The Factory Method-- - Chief Producers by each Method--Exchanges of the - World--Relation of Development of Manufactures to - Commerce. - - I. MODERN MANUFACTURING SYSTEMS OF THE WORLD-- 185 - Their Development During the Last Two Centuries--The - Waterfall as a Source of Power--Development of Steam - Power--Enlargement of the Use of Machinery Following - the Application of Power--The Factory Town--Results - of the Application of Steam Power to - Transportation--Electricity as an Aid in - Manufacturing. - - II. THE USE OF MACHINERY IN MANUFACTURING-- 193 - The Spinning Wheel--The Loom--Kay’s Flying Shuttle-- - Hargreave’s Spinning Jenny--Arkwright’s Water - Frame--Crompton’s Spinning Mule--Machinery in the - Iron and Steel Industry--Growth in Manufacturing - Following the Application of Machinery to the Leading - Industries--Effect of Machinery upon the Employment - of Men--Effect upon Employment of Capital--Effect - upon Prices of Labor, of Raw Materials, of Finished - Products--Effect upon Commerce--Effect upon the - Quality of Manufactures Produced. - - III. DEVELOPMENT OF THE FACTORY SYSTEM-- 203 - Growth of the Factory System in England--Causes of the - Recent Growth of the Manufacturing Industries in the - United States--Estimates of the Value of Manufactures - in the Principal Countries of the World--Net and - Gross Valuations of Manufactures in the United States. - - IV. CAPITAL IN MANUFACTURING-- 214 - Capital a Growing Factor in Manufacturing Industries-- - Manufacturing in Great Establishments and under - Expert Management a Favorite Investment for - Capital--Effect of Increase in Gold Production-- - Investments of Capital and Use of Machinery Increase - more Rapidly than Employment of Labor--United States - Statistics of Investment and Production Superior to - those of Other Countries. - - V. TRUSTS AND COMBINATIONS-- 222 - Reasons for Co-Operation--The Pooling System--The - Company--The Corporation--Trusts and Other - Combinations--Causes of the Transformation from the - Company and the Corporation to the Trust--Effect of - Trusts upon Production, Prices, Wages and Employment. - - VI. THE IRON AND STEEL INDUSTRY-- 230 - Pig Iron the Basis of all Iron and Steel Manufacturing-- - Pig Iron Production of the World in 1800 Compared - with 1907--Fall in Prices of Iron and Steel a Result - of the Application of Modern Methods of Manufacture-- - History of Iron Manufacture; Development in England - and Germany--History of Iron-Making in the United - States--Transformation from the Charcoal Method to - that of Coal and Coke--The Earlier Methods of - Manufacturing Steel Contrasted with those of Today-- - Rival Claims of the English and the American - Inventors, Bessemer and Kelly, to the Modern System - of Steel Manufacturing--Description of the Process of - Manufacturing Steel under American Methods--The Use - of Powerful Machinery and Lessening Proportion of - Work Performed by Man Power--The Railway and - Steamship in Relation to the Steel Industry--Great - Combinations of Iron and Steel Manufacturers--Description - of the Process of Transforming Iron into Steel by the - Bessemer Process. - - VII. THE TEXTILE INDUSTRY-- 247 - Growth of the Textile Industry from the Hand Industries - to Use of Machinery and the Factory System--Great - Britain, the Greatest Cotton Manufacturing Country of - the World in Proportion to Population--The United - States the World’s Greatest Producer of Raw - Cotton--Contrast of Manufacturing Methods in the - United States and Europe--Great Britain the World’s - Principal Cotton Manufacturer for Exportation--The - United States a Large Manufacturer but Chiefly for - her Own People--Light Grades of Cotton Manufactured - in Europe--History of the Textile Industry--Description - of the Manufacture of Textiles--Cotton Manufacturing - has Outgrown that of Other Textiles--History of its - Manufacture in India, in Asia Minor, in America, and, - in Recent Years, in Japan--Other Oriental Countries - Manufacture by the Hand Processes--Growth of the Use - of Machinery in Cotton Manufacturing, from the - Spinning Wheel and Spinning Jenny to Modern Machine - Methods--The Textile Industry of the United States. - - VIII. THE MANUFACTURING INDUSTRIES OF THE UNITED STATES-- 263 - The United States the World’s Greatest Manufacturer-- - Its System Developed More Recently than that of - Europe--Has Utilized Modern Methods in Combination - with Large Sums of Capital--The United States the - Only Nation Taking a Census of Manufactures--The - Gross and Net Value of Manufactures as Reported by - the Census--Relation of the Gross and Net Figures to - Those of Other Countries--Acceptance of the Lowest - Estimate of Manufactures in the United States Places - her Products Far in Excess of Those of any Other - Nation--Growth of Manufacturing has Outgrown - Consuming Power of the People and Resulted in Rapid - Growth in Exportation--Manufactures Form a Growing - Share of Exports--Principal Manufactured Articles - Exported and Principal Countries to which Sent. - - IX. STATISTICS OF MANUFACTURING-- 289 - Production of Manufacturers’ Materials--Development - of Transportation Facilities--Distribution of - Manufactures--World’s Production of Gold, 1492 to - 1908--Enlargement of Capital Invested in - Manufacturing--The Various Classes of Manufactures - Produced in the United States--The Value of Each - Group at Recurring Censuses from 1880 to - 1905--Distribution of the Manufacturing Industries in - the Various Sections of the United States--Share - which Manufactures Form in the Imports and Exports of - the United States--Share which Manufactures Form in - the Imports and Exports of the Principal Countries of - Europe--Estimated Value of Manufactures Produced in - the Principal Countries of the World, 1780 to - 1905--Commerce of the World, 1780 to 1905--Number of - Persons Engaged in the Principal Manufacturing - Industries of the United States--Cotton Spindles of - the World--Cotton Production of the World--Growth of - Population, Commerce, Transportation Facilities, and - in Production of Certain Articles Required in - Manufacturing, 1800 to 1908. - - Concrete and Steel. - By J. F. SPRINGER 322 - - Chemistry and the Industries. - By BENJAMIN BALL FREUD 341 - - The Close Relation of the Producer-Gas Power Plant to the - Conservation of our Fuel Resources. - By ROBERT HEYWOOD FERNALD 352 - - Efficiency in Shop Operations. - By H. F. STIMPSON 370 - - The Bridge Between Labor and Capital. - By JOHN MITCHELL 380 - - The Unemployed. - By JOHN BASCOM 384 - - Quiz Questions 403 - - - - -PRACTICAL ECONOMICS. 1 - -BY ERNEST LUDLOW BOGART, Ph. D. - -[Born Yonkers, N. Y., 1870; A. B., A. M., Princeton University, 1890, -1896; Ph. D., University of Halle, 1897; Graduate Student, University -of Halle, 1894, 1896-7, University of Berlin, 1894-5, Princeton -University (Fellow), 1895-6, Columbia University, 1897-8. Assistant -Professor Economics and Social Science, Indiana University, 1898-1900; -Professor Economics and Sociology, Oberlin College, 1900-1905; -Assistant Professor Economics, History and Politics, Princeton -University, 1905-9; Associate Professor Economics, University of -Illinois, 1909. Author of Economic History of the United States -(Longmans Green & Co., 3rd edition, 1909), and several monographs and -periodical articles.] - - - - -INTRODUCTION. - - -In the preparation of this text the author has endeavored to apply the -principles of economic science to some of the more important problems -of the modern industrial world, and especially those now confronting -the people of the United States. He has attempted in doing this above -all to make the text practical. The student or teacher of economics -will recognize at once that the sections are arranged into groups -corresponding with the traditional divisions of economic text-books -into production and distribution (land, capital and organization, and -labor), consumption, exchange, and the relation of the government to -the individual. It is hoped that the text may not be without profit -and interest to the general reader as well as the students of the La -Salle Extension University. - - - - -I. THE MODERN INDUSTRIAL SYSTEM. - - -We shall probably get the clearest idea of the complexity of our -modern industrial society if we contrast it briefly with the simpler -state of social organization which preceded it. For this purpose we -may take the English manor of the eleventh century. At that time -England was a purely agricultural country, and the whole country 2 -was divided into manors, of which the lord was regarded as the owner, -under feudal conditions, while those who cultivated the land were his -tenants. These tenants--villeins and cotters--worked on the lord’s -land two or three days in the week, and the rest of the time -cultivated their own holdings. The whole of the land of the manor, -both that of the lord and that of the tenants, was cultivated on an -elaborate system of joint labor. The land was divided into strips of -about half an acre each, and a man’s holding might consist of a dozen -or more of these strips scattered about in different parts of the -manor. This was done in order to secure equality in the fertility and -location of each man’s land. At that time the prevailing method of -agriculture was known as the three-field system, in which one field, -comprising about one-third of the manor and containing a portion of -the scattered strips of the lord and every tenant, was planted with -wheat, a second field comprising another third of the cultivated land -was planted with barley or oats, while the third field was left -fallow. The second year saw the second stage of this three-year -rotation, one-third of the manor lying fallow each year to recuperate -from this exhausting method of cropping; artificial manures were -unknown. - -Now the significant characteristics of such a manorial society were -three. First, it was economically self-sufficient, that is, -practically everything that was needed or was consumed on the manor -was produced there. There was no need of intercourse with the outside -world and there was little contact with it. Salt, iron, and millstones -were almost the only things that the inhabitants of such a manor had -to buy from outsiders. Consequently there was no production of goods -for a market, little money, and almost no trade. The few things that -were purchased were paid for at prices fixed by custom. Secondly, -agriculture was carried on under a system of joint labor, and -under customary methods which did not change from generation to 3 -generation. It is clear that as long as all the land of the manor was -thrown together, for purposes of cultivation, into fields on which -were planted wheat or barley or which lay fallow, no one individual -could cultivate his land differently from his neighbors. Indeed, the -holdings of the different tenants were not even separated by fences, -but only by ridges of grass. On the land which lay fallow the cattle -were turned out to graze; if any man had attempted to plant a new crop -the third year, his neighbors’ cattle would have devoured it under -such a system. Production was regulated absolutely by custom, and no -opportunity was given for the development of the inventiveness or -initiative of the progressive individual. Thirdly, the tenants were -personally unfree, that is, they did not have the liberty of moving -freely from place to place, but were bound to the soil which they -cultivated. A man could not freely choose either his occupation or his -residence. There was no mobility or freedom of movement. Labor was -wholly or partly compulsory, and on terms rigidly fixed by custom or -by superior authority. - -Such a society differs from that of today in almost every point, and -offers a startling proof of how far we have progressed in the past -eight or nine hundred years. For many of these characteristics, -however, we do not need to go back to the English mediaeval manor; the -plantation of the South two generations ago, with its system of slave -labor, furnishes an illustration more familiar to most of us. With -such a condition of industrial development we may now profitably -contrast our own of the twentieth century. The chief characteristics -of the modern industrial system are the institutions of private -property, of competition, and of personal liberty. - -The institution of private property is so familiar to us and so -fundamental in modern economic life, that we commonly regard it as -a natural right. Nevertheless, private property, like most other 4 -economic institutions, is the result of a long evolution. Primitive -man can hardly have had the conception of private property, and when -it did begin to emerge, it was at first confined to movables. Indeed -we may say that on the mediaeval English manor the private ownership -of land did not yet exist in the modern sense. It was found however -that, when each cultivator was permitted to fence in his holding and -to call it his own, he cultivated it much more carefully and produced -much more. Inclosure led to private property in land and to individual -freedom in its use. Today in the United States the possession and -transfer of landed property is almost as easy as that of movables. -Private property must be justified on the ground of social utility, -because under this method of control so much more is produced than -under any system of commercial ownership yet tried. But there are not -wanting objectors who contend that limits should be placed upon this -institution, and that the right of use, of bequest, and possibly of -unlimited acquisition should be brought under social control. The -beneficence of private property turns largely upon the existence of -competition and individual liberty and to these we must now turn. - -Competition is defined as “the act of seeking or endeavoring to gain -what another is endeavoring to gain at the same time.” But competition -in modern industrial life is not merely a struggle to appropriate an -existing good. The very contest, as over the control of a market, may -and probably will lead to cheaper and larger production, and thus to -the benefit of society. Competition is a selective process in our -modern economic society, and through it we have the survival of the -fittest. “Competition,” so runs the proverb, “is the soul of trade.” -There is, to be sure, a dark side to the picture, for economic -competition involves the defeat of the weaker party, but this does not -necessarily mean his destruction, for his very failure may sharpen 5 -his faculties and secure his ultimate success, or at worst he may find -employment under his successful rival. But here again it is being -urged that competition is brutal and that we should go back to the -mediaeval method of regulation by custom, or resort to combination and -monopoly. We are now witnessing experiments in both directions, but -competition still remains the controlling force of modern economic -society, and bids fair to continue so. It should however be the -function of society to raise the ethical level of competition. - -Industrial liberty has been developed even more slowly and painfully -than the institution of private property, and has in some instances -not yet been wholly won. Slavery and serfdom have given way before the -higher and more beneficent conception of freedom or liberty. We -believe today that a man generally knows what is best for him and will -utilize his opportunities to the best advantage; that by giving him a -maximum of freedom the welfare of society will at the same time be -best promoted. Consequently, in our modern industrial society, a man -is given not only social and religious liberty, but is free to move, -to choose his occupation, to produce and to trade, to associate with -his fellows, and to expend his income as he will. But here again, -while the prevailing rule is liberty, society has found it necessary -to lay restrictions upon the abuse of this liberty. It is not enough -even to regard the industrial world as a great game in which each may -act as he pleases provided only he observes the rules of the game. A -higher conception of responsibility and duty must accompany freedom of -action if we are to secure the best results. - -The term “industrial society” has already been frequently used and -needs a somewhat fuller explanation. About the year 1760 there took -place in England what is usually called the Industrial Revolution. A -number of inventions were made which rendered it possible to use 6 -steam-driven machinery in the manufacture, first of textile and then -of other goods. Manufactures were removed from the home, where they -had hitherto been carried on, to the factory. Capital began to be used -in large masses, machinery displaced hand tools, and the laborer -ceased to own the implements with which he worked. Men, machines, and -capital were massed in the factory and organized under the management -of a new set of industrial organizers for the purpose of producing -goods for a world market. The development of such an industrial -society has been attended by the minute division of labor, by a -growing separation of classes, by concentration of the population in -urban centers, by the increasing cost and complexity of machinery, by -the development of improved methods of transportation and of credit, -by the combination of labor and of capital, by the enormous increase -of production, and by the growing concentration of wealth. - -The introduction of power manufacture completely revolutionized -industry. The independent workman with his own tools was superseded by -the factory, the small producer has given way in turn to the trust. -With the introduction of expensive machinery it became necessary to -organize capital on a large scale. Corporations with limited liability -were organized for the manufacture of goods, the exploitation of -mines, the building of railroads, and the carrying on of trade. As -methods of production improved industry became more and more -concentrated, and finally huge trusts took over the operation of -combined plants. The business unit has grown increasingly larger, and -the need and power of capital have become increasingly important. -Capital has played a role of growing significance and has become more -and more powerful in modern economic life. Indeed the name -“capitalistic production” has been applied to modern industry because -of the predominant importance of capital in all lines of wealth 7 -production. Impersonal, growing by sheer force of its own momentum, -capital is often thought of as intensely selfish and even cruel. -Abuses which have arisen in the development of modern capitalistic -industry must be remedied, but attacks upon capital itself are -misguided and rest upon a mistaken analysis of methods of production. - -Before the introduction of the factory system, under the so-called -“domestic” system of industry, the laborer carried on his work in his -own home, where he provided the raw material, owned his own tools, -furnished the motive power--his muscles--and was his own master. Today -every one of these conditions is changed--the work is carried on in -the factory, the raw material, the tools, the motive power are all -provided by the capitalist, the laborer contributing only his own more -or less skilled labor, while the conditions under which he carries on -his work are largely determined for him. He is no longer his own -master. To protect himself against the growing power of capital the -worker has organized with his fellows into trade unions. These seek to -meet the monopolistic power of capital by exerting a monopolistic -control over labor. While they realize that modern productive -processes cannot be carried on without capital, they also insist that -labor is equally essential. They claim that capital has received more -than its fair share of their joint production and has exploited labor; -consequently they insist that labor must now demand its just reward -and enforce the claim by strikes and by raising wages. To enforce -their monopoly, the policy of the closed shop is often enforced. The -interests of capital and labor have thus often been made to appear -antagonistic instead of complementary to one another. Frequently in -their struggles the interests of the consumer have been entirely lost -sight of. - -These conflicts in the productive processes of modern economic society -have led many people to look to the state as the regulator of industry 8 -and to invoke state aid or state interference along many lines. -Maladjustments in the labor contract, mistaken production, leading -perhaps to speculation and financial panics, abuses of power by -corporate interests, discriminations by railroads, and similar -irregularities are made the excuse for an appeal to state authority. -Some would even go so far as to have the state take over and manage -all productive enterprises; but socialism is as yet a protest rather -than a constructive force. In the last analysis the state is the -regulator of all industrial undertakings, for they all concern -society. The state must hold the balance even and see that fair play -is given to all groups and all classes; but the greatest amount of -freedom compatible with economic justice must be sought for. It is a -difficult question how far the state must interfere in the conduct or -management of industrial enterprises in order to secure social -justice. There is a decided tendency at present to a strengthening of -the regulative power of the state for the protection of the weaker -classes of society. And yet on the whole the institution of private -property, free competition, and a maximum of individual liberty remain -the fundamental conditions of our economic life. - -But while under the system of individualism, industrial activities -have been multiplied, wealth has been enormously increased, and human -progress has been greatly advanced, many abuses and evils still -remain. Many practical economic problems still await solution. Some of -these have already been suggested in the preceding paragraphs; others -remain to be presented. It is the purpose of this text to apply to -some of the more important practical current problems of our modern -industrial life the principles of economic science, and to endeavor to -reach fair and just conclusions on controverted points. - - - - -II. THE AGRICULTURAL RESOURCES OF THE UNITED STATES. 9 - - -The land area of the United States, exclusive of Alaska and our island -possessions, is a little less than 3,000,000 square miles, or an area -somewhat less than the whole of Europe (3,700,000 square miles). Of -this about 840,000 square miles, or a little more than one-fourth, -still remains in the possession of the Federal Government and -constitutes the public domain. The rest belonged to the original -thirteen states, has been given to railways or to the states for -educational purposes, or has been sold and given away to individual -settlers. The policy of the Government in the disposition of the -public domain has, on the whole, been to place it as rapidly as -possible in the hands of cultivators, and also to use it as a fund to -promote internal improvements and education. About 200,000,000 acres -had been granted to railroads down to 1871, at which time land grants -were discontinued, to secure their early construction. This policy has -often been bitterly condemned, and it has been contended that the land -should have been saved for actual settlers. It may however be said -that without such grants the railroads would not have been built at as -early a date as they actually were, and that without railroads the -land was practically worthless, as it was too far removed from any -navigable waterway to have access to a market. Moreover, the Federal -Treasury lost nothing, for the sections of land alternating with those -granted to the railroads were sold to settlers for $2.50 an acre -instead of $1.25, the customary price for the public lands. - -The grants of land for educational purposes have been generally -approved. Upon such grants rests the establishment of our state -agricultural colleges. - -The unique and characteristic feature of the land policy of the United -States has been the granting of land to the settler upon actual -residence and cultivation for five years. Such a grant of 160 acres 10 -is called a “homestead,” and since 1862 has been made to any citizen -who is the head of a family or above the age of twenty-one years. In -this way over 230,000,000 acres have been placed without cost in the -possession of the actual cultivators. The newer public land states are -peopled by proprietors, and there has never grown up in the United -States a large class of rich land owners whose land is cultivated by a -tenant peasant class, such as exists in England and parts of Europe. -For this we must thank not only our land policy, but also the vast -extent of unoccupied land that might be had almost for the asking. - -Now, however, the public lands available for agriculture have been -exhausted; practically all that remains is situated in the arid zone, -and needs systematic irrigation before it can be made available for -any use except that of grazing. There are still about 100,000,000 -acres of choice land in Indian reservations, and as a consequence of -the pressure upon this resource and also because of the unwisdom of -the old reservation system, the policy has now been adopted of -dividing these lands among the Indians in individual ownership, under -careful safeguards, and of assimilating the Indians to the rest of the -population. - -The exhaustion of the fertile and well-watered lands of the -Mississippi Valley has forced the later comers to have recourse to the -arid soils in the almost rainless region west of the one hundredth -meridian of longitude. The character of farming under such climatic -conditions must of necessity be very different from what it is in the -rainy districts, and the versatility and adaptability of the American -farmer is well illustrated by the development which has taken place -there. The first effort at the solution of the problem was in -irrigation, a method which had been early practised by the Pueblo -Indians, and later and most successfully by the Mormon settlers in -Utah. By 1900, according to the census, 7,539,545 acres were under 11 -irrigation. While most of the work up to that time had been done by -private initiative, a demand arose for irrigation at government -expense, in response to which Congress in 1902 provided for the -building of irrigation works out of the proceeds of the sales of -public lands. Regulation and conservation of the limited water supply -by governmental authority, either state or national, is indeed -essential to the success of irrigation and will probably be the policy -of the future. - -A second and even more interesting development of American agriculture -is the so-called dry-farming which is being successfully introduced -into the semi-arid regions. Carefully selected seeds and plants of -crops especially adapted to these climatic conditions are used, and -then a very careful and intensive method of tillage is followed. The -soil is plowed deep and thoroughly pulverized so that the roots can -strike down to the deeper levels and absorb all the moisture -available. Extraordinary results have already been attained, and the -region that the older geographies labeled “The Great American Desert” -bids fair to become one of the most flourishing districts in the -country. - -That part of the area of the United States which has already been -reduced to private ownership is divided into 5,700,000 farms. As -almost half of the land in these farms is uncultivated, being forest, -waste land, or pasture, it is evident that there is still room for a -great increase in the agricultural production of the United States -without bringing additional land into the field. The average size of -these farms is 146 acres, which looms large indeed when compared with -the 20-acre farms of France and the 60-acre farms of Great Britain. -The difference is of course due to the difference in the methods of -agriculture and the character of the crops, the European conditions -demanding intensive cultivation while our methods are still largely -extensive. - -A more important question even than the number and size of farms, from 12 -an economic point of view, is that of ownership. In 1880, when for the -first time the federal census collected the statistics of farm tenure, -the gratifying result was announced that three-quarters (74.5 per -cent) of the farms in the United States were cultivated by their -owners. The last census however showed that the proportion had fallen -to 64.7 per cent in 1900, and alarm has been expressed that our -democratic conditions of land ownership are giving way to a system of -tenantry, that the ownership of our farms is being concentrated in -fewer hands, and that methods of large-scale production in agriculture -are crushing out the independent farmer as effectively as they have -crowded out the small manufacturer and retailer in other fields. -Correctly interpreted, however, the statistics seem to indicate that -the growth of the tenant class marks the endeavor of farm laborers and -farmers’ sons to establish themselves as independent farmers rather -than the fall of former owners to the rank of tenants. The great -majority of the young men are laborers, the majority of those in -middle life are tenants, while the older men are for the most part -owners of farms. There seems to be a healthy progress upward in the -advancement of wage laborers and farmers’ children, first to tenancy, -and finally, with increased ability and capital, to farm ownership. -Moreover most of the rented farms are hired by negroes, the change in -whose status from slave to tenant marks a great advance. - -Another change in our farming population that has been viewed with -considerable misgiving is the movement from the farm to the city and -the decline in the proportion of the agricultural population to the -whole. Indeed the change has been startling, as the United States has -passed from a primitive agricultural stage of development to a highly -organized manufacturing and commercial stage. From 86.3 per cent of -the population in 1820 the percentage of those engaged in agriculture 13 -fell steadily until it reached 35.7 per cent in 1900. Many persons -have thought that such a movement indicated the desertion of our farms -owing to the greater attraction of the cities, and the disappearance -of a healthy agricultural population. It has indicated rather a great -improvement in the arts of agriculture, whereby one person today, -working with improved machinery and better knowledge, can produce -nearly three times as much as his grandfather did. The labor set free -has gone to the cities--cities of over 8,000 inhabitants now contain -one-third of our population as compared with one-thirtieth one hundred -years ago--and there produces the thousand and one things which -contribute to our modern well-being. A smaller number can now raise -all the food necessary to feed the population; that the rest are free -to do other things must certainly be counted again, though the -conditions under which work in the factory and life in the city are at -present constructed leave much to be desired. - -Writing about 1865 an eminent English traveler, Sir S. Morton Pets, -apologized for calling the United States an agricultural country; -today he would be spared this worry, for the Census of 1900 gave the -net value of products of the farm as $3,764,000,000 and of pure -manufactures as $5,981,000,000. Indeed since 1890 the value of the -manufactures of the country has been larger than of the farm products, -and the United States now ranks as one of the leading manufacturing -nations of the world. Nevertheless the value and amount of the -agricultural products are stupendous; the United States leads all -countries in the production of dairy products, corn, and wheat, and -the greater part of the lumber, meats, tobacco, and cotton which enter -into the world’s trade come from her forests and fields. - -While the territory of the United States is well adapted by nature to -the cultivation of a great variety of agricultural products, as a 14 -matter of fact only four branches of agriculture showed a total -product in 1900 of more than one million dollars. These were the -raising of live stock, and the production of hay and grain, cotton, -and dairy produce. The regional distribution of these products was -fairly well marked, over half of the live stock and of the hay and -grain farms being situated in the North Central States, nearly half of -the dairy farms being located in the North Atlantic division, while -practically all the cotton is confined to the southern zone; the same -may also be said of tobacco and sugar. The semi-arid region of the -West is given over almost exclusively to stock-raising. Iowa and -Illinois lead as agricultural states. - -The character of agriculture in the United States, as in all new -countries, has hitherto been extensive, that is, a small amount of -labor and capital has been applied to a relatively large amount of -land, and only the cream of the soil has been skimmed off, as it were. -Where labor is dear and land is cheap this is the most economical -method for the farmer; and, although European critics have severely -criticized our system of “earth butchery,” whereby the fertility of -the soil has been exhausted by constant cropping, with no effort to -restore the exhausted properties by fertilizing, the practice has been -justified by the conditions which produced it. Already the practical -exhaustion of the free public domain has had the effect of raising the -price of lands in the Middle West, and this in turn will cause a more -careful and intensive system of cultivation. In other words, as our -social and industrial conditions approach those of Europe more -closely, we may expect our agricultural methods to do so also. One of -the most serious practical problems now confronting the American -farmer is the change from the old, wasteful, extensive methods to the -new, careful, intensive methods of farming. Those who cannot make the -change will complain of the unprofitableness of agriculture, but to -those who successfully meet the new conditions the future offers 15 -much greater rewards than even the era of free land could produce. - -It has been said that the year 1887 marked the beginning of a new -stage of development in American agriculture--that of reorganization-- -because in that year Congress passed the Experiment Station Act. This -marked the application of the principles of experimental science to -agriculture on a more comprehensive and systematic scale than had ever -been attempted before. Stimulated by the increased activity of the -government experiment stations, the agricultural colleges have -expanded their work. They are offering practical courses to the -farmers, and in co-operation with the railroads, some of them have -recently been sending out special lecturers, with moving laboratories, -to bring the teachings of science as close home to the producers as -possible. Finally, the wonderful work being done by Burbank and others -in selecting and crossing, by travelers for the federal Agricultural -Department in securing plants from all over the world suited to our -varied climatic conditions, and by the experiment stations and -agricultural colleges in spreading the new knowledge among the farmers -and putting it into actual practice--all these departures promise to -revolutionize agriculture, and to make it, as one writer has said, a -learned profession. - -The production of cereals is the most important branch of agriculture, -comprising corn, wheat, oats, barley, rye, buckwheat, and rice. Since -the building of the trunk railroads, by which the western territory -was given access to a market, the progress of cereal production has -been extremely rapid, nor does there seem to be any observable -slackening. With the introduction of improved varieties of spring -wheat, cereal production is being pushed further up into British -Canada and our own Northwest. The center of cereal production has -moved steadily westward, from eastern Indiana in 1860 to eastern Iowa -in 1900. With the practical exhaustion of unoccupied land suitable -for grain-raising in the United States, it is clear that the future 16 -extension of the industry depends rather upon improvements in the -methods of agriculture than upon the addition of new lands. The very -practical problem here presented to the American farmer if he wishes -to maintain his supremacy in the world’s markets is being nobly and -successfully met by the agricultural experiment stations. They are -teaching the farmer how to increase his yield of wheat, for example, -by scientific seed selection and more careful methods of tillage, from -an average of 12.5 bushels per acre for the whole country in 1900 to -treble that amount. - -Of the separate crops corn is by far the most important, representing -60 per cent of the total value of all cereals produced in 1900. Most -of the corn is fed to stock throughout the so-called “corn belt” and -comes to market in the form of pork and beef. Although corn is very -nutritious and is a favorite article of diet in this country in -various forms, astonishingly little of it is exported. The development -of a foreign market still awaits the enterprise of the American farmer -and food manufacturer. - -The production of live stock is essentially a frontier industry, and -while it will probably always be carried on in the semi-arid grazing -districts of the West, which can be reclaimed for agriculture only at -considerable expense, it already shows a relative decline. Owing to -the great growth of the population the domestic demand now consumes -almost all the meat produced and the exports are declining. This is -one of the reasons for the recent rise in the price of meat. The -industry is extensive. Quite the opposite is true of the dairy -industry, which is intensive, being carried on for the most part in -the vicinity of large cities where land is expensive. The changing -character of agriculture and the fact that it is itself a business -enterprise demanding a knowledge of market conditions and business -methods is well illustrated by the nature of the dairy industry. 17 -Dairies are inspected and must conform to certain standards, the milk -must be sterilized and shipped, often by special trains, to the -cities. Over a third of the butter and practically all of the cheese -is now made in factories instead of on the farm, so that it is a -question whether the latter at least should not be classified as a -product of manufacture rather than of agriculture. - -Of the last of the four important branches of agriculture, namely -cotton-raising, there is not so much to be said. Owing to the -intensive nature of its cultivation, machinery has never been applied -on a large scale to its production, as was done in the case of hay and -grain. The wasteful methods that prevailed before the Civil War in the -South have been largely corrected, and the tendency to sterility of -the soil has been met by the increased use of fertilizers. The -statistics of cotton crops for the past thirty years do not indicate -any decrease in productiveness, and show that the point of diminishing -returns has not yet been reached. A peculiar and interesting feature -about cotton production is that it is largely in the hands of tenants. -The old slave plantations of the South have been broken up into small -holdings and many of these are operated by tenants, negroes and -whites, who are too poor or too improvident to buy the land outright. -The main problems connected with cotton culture are labor problems; -and the question has often been anxiously asked whether the free negro -will produce as much as the former slave. This can now be confidently -answered in the affirmative, though it yet remains to be seen whether -he can be made as efficient a producer as his white competitor. Upon -the answer to that question depends not merely the future of cotton -production, but the economic salvation of the negro himself. The -constantly expanding use of cotton goods assures a brilliant future to -the cotton-growing states of the South, for not merely is there an -assured market in America and Europe, but the primitive peoples of -Asia and Africa may be depended upon to absorb increasing quantities 18 -of cotton fabrics. - -Hand in hand with the heedless extensive methods of agriculture in the -past went wasteful use and even destruction of our forest resources. -The annual cut of lumber in the United States is today about forty -billion feet board measure; at this rate of consumption it is -estimated that the present available supply will last only 35 to 50 -years. It will doubtless surprise most readers to learn that about -three-quarters of the annual wood cut is consumed as fuel, probably -half of our population still depending upon wood instead of coal for -fuel. The rapid exhaustion of our forest supplies, with the attendant -effects upon moisture, floods, etc., has brought the question of -forest preservation to the front as a practical economic problem. We -have been squandering the heritage of our children and efforts are now -being made to repair some of the loss before we are declared bankrupt. -In 1898 the Federal Government began practical work in the -introduction of forestry; this received a great stimulus in 1905 when -the care of the national forest reserves, embracing over 60,000,000 -acres, was put under the control of the Forest Service. Over 150 -trained foresters are employed, who manage the forests on the public -lands and co-operate with private owners in the introduction of -scientific forestry. Several states have taken up the movement, and -there is every indication that scientific methods of culture such as -prevail in Prussia and other European states, will supplant our -destructive denudation of the land. That it is high time to devote -attention to the better conservation of this natural resource is made -evident by the high and increasing price of lumber. - -There is one other natural resource the conditions of whose supply -resemble those of forestry and of agriculture in general; this is the -fisheries. With careful use, providing for depreciation, and restoring -the elements destroyed, all of these should prove inexhaustible and 19 -should continue to furnish man with food and lumber for all time. But -as in the case of the other two industries, so with the fisheries, we -have been using up our capital and declaring enormous dividends at the -expense of the future. The value of the annual catch of fish is -$40,000,000, which is exceeded only by that of Great Britain. The -problem of the better conservation of this resource has been taken in -hand by the Federal Government, through the Fish Commission, and much -has been done to repair our early prodigality by restocking lakes and -streams with fish. More stringent fish and game laws have also been -passed by most of the states, designed to prevent the extermination of -the supply. - - - - -III. THE MINERAL RESOURCES OF THE UNITED STATES. - - -The natural resources of any country may be divided into two broad -groups, which call for different treatment and give rise to very -different problems. There are, on the one hand, resources which are -exhaustible but which can be restored again; and on the other, -resources which, once exhausted, can never be replaced again by human -agency. Under the first head come the soil, the forests, the -fisheries, and even the water power, for all of these can be made to -yield steady returns to man for thousands of years, if used -intelligently. Under the second head belong coal, petroleum, natural -gas, and all the minerals; man may discover substitutes, he may -economize in the use of these substances, but he can never augment -their supply. In the previous section we considered some of the -problems that arise in the use of the soil in agriculture, and those -connected with our forests and fisheries. For the most part they had -to do with the intelligent use of these agencies and the restoration -or repair of the elements destroyed. In this section we are met by a -very different problem, namely, the conservation of a limited supply 20 -of resources and their most economical application to the needs of -mankind. - -We can distinguish two contrasting answers to this problem, one -careless and optimistic, and the other pessimistic and fearful of the -future. According to the former point of view we should not borrow -trouble of the future; man’s career has been one of constant progress; -when he has been confronted with a difficulty he has invariably met -it. Indeed necessity has been the most prolific mother of invention. -If our coal supplies are exhausted, man will devise means of utilizing -the heat of the sun, the force of the tides, the motion of the waves, -the stores of electrical energy in the air, all of which will yield -inexhaustible supplies of heat and energy. If our stores of iron -should fail, some enterprising inventor would surely discover a -practicable and commercially profitable method of extracting aluminum -from clay. New sources of raw materials will undoubtedly be discovered -before the old ones give out, and we may confidently expect that, -while the material bases of a high civilization may shift somewhat, -they will never crumble and fall. - -The other school has sounded a louder note of alarm. At the present -rate of consumption the coal and iron deposits of Europe and America -must soon be exhausted. The supplies of copper, lead, and other metals -in favorable locations are also being consumed at an alarming rate, -and no other known supplies are in sight. Within the past century -scientific knowledge and engineering skill have combined to unlock the -storehouses of the geologic ages, and now like prodigals we are -dissipating our fortunes. To treat these exhaustible sources of supply -as permanent sources of income, without regard for the future, is -based upon unsound theory and must lead to reckless practice. - -As so often in opposing counsels, there is an element of truth in each 21 -of these contrasting points of view. But the safer plan is not to wait -until we have exhausted our natural resources before remedying the -evil, but to heed the warnings now. A long step in this direction was -taken in May, 1908, when a conference of the governors of all the -states, together with college and railroad presidents, business men -and others, was held at the White House upon invitation of President -Roosevelt. As a result of this gathering a National Conservation -Commission was appointed, which will make an exhaustive investigation -into the amount and rate of consumption of the natural resources of -the country and suggest measures for their better utilization and -preservation through national, state, and local action. In line with -this movement two other commissions have been established, one on -inland waterways and one on country life. As a result of the national -awakening we may expect to see a more rational use made of the gifts -of nature, and a better organization of our national life. Heretofore -the ideal of our business men has been to exploit, one might almost -say pillage, the stores of nature as rapidly as possible; it was a -pioneer stage of industry, inevitable but wasteful. From now on the -new conception must be the restoration where possible of exhausted -elements, as of the soil and the forests, and the careful use of the -non-renewable stores of wealth so that at least we shall not make them -engines of destruction, as in the case of floods and devastation -occasioned by careless hydraulic mining in the West. Let us now turn -to a more detailed consideration of the separate items in our -inventory of national wealth. - -Our modern civilization may be said to rest upon coal, for upon its -possession depends man’s ability to utilize most of the other items of -his wealth. Passing over its utility as a fuel to heat our houses, -without coal it would be impossible to smelt the iron needed in all -our industries, to drive the machinery, to run our locomotives or 22 -steamboats, or in a word to carry on the manifold activities of our -industrial life. According to the United States Geological Survey -there are 335,000 square miles of coal-bearing strata in this country, -but the larger part of it is too thin or impure to be useful for -industrial purposes; it serves in many localities however as domestic -fuel, as in the case of the lignite deposits of the Northwest. An -estimate of Professor Tarr places the coal-producing area in the -United States at not over 50,000 square miles. At the present rate of -consumption--over 350,000,000 tons in 1905--it has been estimated that -the anthracite coal deposits will last for only fifty years longer, -while we have only enough bituminous coal for one hundred years. - -The large deposits of coal in England and their early development gave -that country a great advantage over Europe. But as long ago as 1861 -Professor Jevons, a noted English economist, sounded a note of alarm: -he prophesied that because of the superior size and character of the -coal deposits of America, industrial supremacy must inevitably pass to -this country. His prediction has already been verified in the case of -coal and iron production, and will probably soon prove true of -textiles also. The coal deposits of the United States are thirty-seven -times as great as those of England, but at the present rate of mining -are threatened with exhaustion at no distant date. It has been -estimated that there are in China coal deposits capable of supplying -the world with fuel for another thousand years. But such estimates -are, in the present state of our knowledge about China, the merest -guesses, and if true would seem to point rather to the future -industrial supremacy of that country in the world’s markets. - -Two-thirds of the coal mined in the United States is obtained from the -Appalachian field, extending from New York to Alabama, Pennsylvania -being the largest coal-producing state in the Union. In the iron and -steel industries most of the coal is coked, as it is better for 23 -blast-furnace use in this form, giving greater heat and containing -less sulphur or other injurious substances than coal. Owing to the -smaller bulk and cost of transporting ore, most of the iron and steel -industries are situated in the vicinity of the coal supply, as in -Pennsylvania, Ohio, Alabama, etc. - -Petroleum or coal-oil is closely allied to coal in its origin and -distribution and must be classed with it as a most important product, -not only for industrial uses, but also because of the contributions it -has made to the comforts of living. In its production the United -States ranks first, being closely followed by Russia; together these -two countries furnish over 90 per cent of the world’s supply of -petroleum. Enormous economies have been effected in its production and -distribution, which is done by piping the crude oil underground to the -refineries. For illuminating purposes it is the cheapest form of -artificial light; as a fuel it is supplanting coal, where the latter -is dear or its cost of carriage high, as on ocean steamers. Finally, -the construction of light and convenient gasoline motors has given it -great importance as a source of motive power. Natural gas is closely -related to petroleum, but the supply has been so reduced by rapid and -reckless use that it has but a limited economic outlook and is of -local significance only. - -Of all the metals iron must be considered the most useful for man, far -surpassing the so-called precious metals in economic importance. Its -great value is so evident that its production and use have often been -taken as a criterion of the material progress of a community. Iron is -the only metal that can be welded, and is accordingly of great -significance, whether in making strong machinery, as the shafts of -ocean steamships or the framework of a twenty-story building, or, in -the form of steel, the most delicate surgical instruments or watch -springs. Judged by the test of iron ore production the United States 24 -ranks high, for it turns out about four-fifths of the world’s supply; -all of this is used for domestic consumption, in its own blast -furnaces, though much of it is afterwards exported in the form of pig -iron or structural iron or steel. Though iron is universally -distributed throughout creation, it must occur in large beds or -deposits before it can be profitably mined. “The most favorable -situation of an iron ore for profitable extraction is near good coking -coal for smelting and limestone for a flux, as in the Birmingham -district of Alabama; and in such a situation even low-grade ores can -be worked profitably. Unless this is the case, iron ore cannot be -extensively mined excepting under conditions of great abundance and -economical methods of transportation, as in the Lake Superior -district, where thick and remarkably uniform beds of good ore occur in -such a position that water transportation to the market is possible. -Where these conditions do not exist, iron-mining is feasible only on a -small scale for the local market. Thus, in the Rocky Mountains there -are almost inexhaustible supplies of iron, often of a high grade, -which are at present of no value whatsoever.”[1] - -The most wonderful iron-mining region in the United States and -probably in the world lies in the northern part of Michigan and -Minnesota, where five ranges or lines of hills contain immense -deposits. These lie so near the surface that they can be dug out of -open pits at a cost of from 10 to 50 cents a ton, against $1 a ton in -a shaft or underground mine. Three-quarters of the iron ore produced -in the United States is mined in this district. Its proximity to the -lake ports makes possible its transportation to the iron and steel -manufacturing centers at very low rates. Machinery has been applied on -an immense scale to the work of mining, loading and unloading the ore. -Steam shovels scoop up the ore from the open pit, filling cars at the 25 -rate of almost one a minute; the work of loading this into the ore -ships at the ports is equally expeditious, only about two hours being -required to load an ore ship of 6,000 tons, while the work of -unloading is performed for the most part by an endless chain of -buckets and traveling cranes. By these means an ultra-intensive -exploitation of these magnificent deposits is taking place and it is a -question whether they will not soon be exhausted. “But the Americans,” -writes Professor Leroy-Beaulieu, a friendly but keen critic of our -industrial development, “relying on the constant good-will of nature, -are confident that they will discover either new and productive ranges -in this district, or rich deposits in other districts.” - -The precious metals have received more than their fair share of -attention, for the industrial progress of the world is much less -dependent upon their presence in large and easily obtained quantities -than it is upon the more common metals. Nevertheless they are of -importance both in the arts and especially because of their use as -money. In their production the United States stands second, being -surpassed in the output of gold by the Transvaal in Africa and in that -of silver by Mexico. The production of these metals has always in the -world’s history proceeded spasmodically, and a speculative spirit has -usually been present. More recently, however, scientific geological -knowledge and improved metallurgical methods are removing the industry -of gold and silver mining from a gambling venture to a legitimate -industry. The practical problem at present confronting American -gold-mining companies is to reduce expenses, some of the principal -bearings having for some years shown signs of exhaustion, as for -instance in the Cripple Creek district of Colorado. There is always a -chance however that new gold fields may be discovered to make good the -exhaustion of the old. In the case of silver, on the other hand, the -metal is found in such abundance that the present rate of production 26 -seems almost indefinitely assured; a slight increase of the price or -improvements in the art of extracting the metal will at any time bring -enlarged supplies on the market. Africa, Australia, and the United -States produce almost all the world’s supply of gold, Colorado being -the leading state in the last-named country. Mexico and the United -States together produce over two-thirds of the world’s silver, the -leading rank in this country being held by Montana. - -Among the other metals copper is by far the most important. In -primitive civilizations, before the art of smelting iron had been -discovered, copper was indispensable as it was so easily malleable; in -Homeric times, for instance, armor, utensils, money, etc., were made -of copper or alloys of copper (bronze and brass). After an eclipse of -some centuries copper has again risen to the front rank by reason of -its qualities as a conductor of electricity. The new use of -electricity to transmit power and the development of electrical -industries has greatly increased the demand for this metal and has -caused a great expansion in its production. Here again the United -States holds first rank, contributing over half of the world’s copper -supply. As in the case of iron the northern peninsula of Michigan is -the most important center of copper production, with Montana a close -second and Arizona contributing most of the remainder. Like petroleum, -copper production is controlled by a small number of operators, five -mining companies alone furnishing one-half of the American supply. It -is far from being monopolized, however, as petroleum is, for new and -rich supplies lie just on the margin of profitable working and will -always be brought into the market whenever the price is artificially -raised. One reason for American pre-eminence, aside from the rich -stores of the metal, lies in the progress made in the art of refining -it by the electrolytic process, considerable foreign ore being brought -here to be treated by this method. - -Nature has not blessed the United States so abundantly with the minor 27 -metals, lead, zinc, and aluminum, while almost all the tin used here -has to be imported. - -It is apparent from even this brief and hasty survey of the mineral -resources of the United States, comprising those extractive industries -which once exhausted can never be restored by man, that this country -is wonderfully well equipped with the material means of civilization. -Minerals and metals are remarkably abundant and accessible. The -wonderful material progress of the United States during the nineteenth -century is abundantly explained by this fact, though due credit must -also be given to the enterprise, industry, and genius of those who -developed these natural resources. The industrial supremacy of the -American nation seems well assured, founded on such a stable material -basis. We of this country have been rather inclined to boast of our -industrial progress and our material bigness, whereas it must now be -apparent that we owe much, if not most, to the bounty of nature. We -should therefore see to it, in a proper spirit of humility and -thoughtfulness, that we do not waste our heritage, but hand it on as -nearly undiminished as possible to our children. - -There is one other asset in our national wealth which has already -contributed much to our progress, and is destined to play an even more -important role in the future--and that is our water power. In colonial -days, before the invention of the steam engine and the use of coal, -this was of prime importance and determined the location of many a -town, most of them being located at the “fall line” of the rivers, -where water power was obtainable. With the invention of the steam -engine and the use of steam as a motive power, industry became less -dependent upon water power and moved away from the rivers to the -vicinity of coal mines. Now again has come another swing of the -pendulum, and with the rise of electricity as a motive power and the -harnessing of our streams and waterfalls for the creation of 28 -electrical energy, we are beginning to value more highly this source -of power. Here again we find the United States wonderfully blessed as -compared with other countries. “It is probable,” says Shaler, “that, -measured in horse power or by manufactured products, the energy -derived from the streams of this country is already more valuable than -those of all other lands put together.” The total amount of direct -water power used by manufacturing establishments in 1900 was 1,727,000 -horsepower. - -Prior to 1890 the largest use of water power was in its direct -application to machinery at the immediate point of development. Since -that time, however, the use of electricity as an agency whereby the -energy developed by falling water can be transformed and applied to -the driving of machinery has entirely changed the conditions under -which the power of our streams can be utilized. The practical -possibility of transmitting electrical power over long distances--for -example, over 200 miles from the Sierras to San Francisco--has removed -the necessity of building factories immediately adjacent to water -powers, but permits its utilization where most convenient and often -where the lack of coal has made the use of steam power impracticable. -The best-known example of the development and transmission of -electrical energy for industrial purposes is the case of Niagara -Falls, but more striking illustrations may be found on the Pacific -coast, while the existence of enormous opportunities on the Atlantic -seaboard give brilliant promise for the future of manufacturing in -this region. So valuable indeed are these sources of power now seen to -be that there is danger that their control may be monopolized by a few -shrewd and far-sighted individuals before the general public awakes to -a realization of their importance. It has recently been asserted in a -reputable magazine that there is a “water power trust” already -organized for this purpose. The opportunities for wealth-getting have -hitherto been so great in this country, and the great task of the 29 -American people has thus far been so exclusively the task of -developing its wonderful natural resources, that we have grown -careless of our common rights and have permitted the monopolization by -private individuals of a number of limited resources of this -character. One of the great practical problems of the future is that -of securing the growing value of these natural monopolies to the whole -people, without at the same time retarding the energy and industrial -development of the American people. - - - - -IV. CAPITALISTIC PRODUCTION. - - -Modern production is usually called capitalistic because it involves -in its processes the use of a large amount of capital. In a primitive -stage of culture man appropriated directly from nature’s bounty the -food and shelter which he required. But today man has adopted long and -roundabout methods of producing goods, involving numerous steps -between his first efforts and the turning out of the finished -articles. He invents tools and machinery to assist him in his work, -and while he multiplies the processes of production he also enormously -increases the results. Capital has become absolutely indispensable in -modern production and is yearly playing a more important role. At the -same time various problems, born of the new conditions, have arisen, -such as the growth of large-scale production, the elimination of the -small producer and the independent artisan, the growth of trusts, the -rhythmic recurrence of speculative periods and industrial crises, the -relations of labor and capital, and others similar in character. - -The most striking phenomenon of the nineteenth century was the great -industrial progress of the more developed nations; this is best shown -in a table taken from Mulhall’s “Industries and Wealth of Nations,” -which follows: - - Growth of Manufactures in the Nineteenth Century. 30 - - ==================================================== - | Millions of Dollars. - Countries |----------------------------------- - | 1820 | 1840 | 1860 | 1894 - ----------------+--------+--------+--------+-------- - United Kingdom | 1,411 | 1,883 | 2,808 | 4,263 - France | 1,168 | 1,606 | 2,092 | 2,900 - Germany | 900 | 1,484 | 1,995 | 3,357 - Austria | 511 | 852 | 1,129 | 1,596 - Other States | 1,654 | 2,516 | 3,455 | 5,236 - Europe | 5,644 | 8,341 | 11,479 | 17,352 - United States | 268 | 467 | 1,907 | 9,498 - ----------------+--------+--------+--------+-------- - Total | 5,912 | 8,808 | 13,386 | 26,850 - ---------------------------------------------------- - -Extraordinary as has been this universal growth, the development of -manufactures in the United States has been still more marvelous, both -absolutely and in relation to other branches of industry Between 1850 -and 1900 the population and the products of agriculture both trebled; -but the value of manufactured products increased twelvefold and that -of capital invested in manufactures nineteenfold The United States, -though politically younger than the countries of Europe, is -industrially one of the most advanced The application of labor-saving -machinery and of improved and economical methods of production and -distribution has probably proceeded further here than in any other -place Nowhere can we study to better advantage, therefore, than in -America the problems that have grown out of this advanced capitalism. - -The causes of this rapid industrial development are enumerated by the -census report as five in number: the agricultural resources of the -country, the mineral resources, the highly developed transportation -facilities, the freedom of trade between states and territories, and -the absence of inherited and over-conservative ideas We have already -considered the wonderful agricultural and mineral resources of the -country, and have seen how greatly the American people are indebted -for their industrial prosperity to the bounty of nature. The 31 -magnificent system of inland waterways, comprising over 18,000 miles -of navigable rivers, and the railroad system, with over 200,000 miles -of track, facilitate a rapid and cheap exchange of products. The -enormous domestic market afforded the American manufacturer, larger in -consuming capacity than that in any other country in the world, has -permitted the economic production of goods on a large scale and a -consequent reduction in cost. Foreigners have often asked the question -why, if freedom from tariffs and trade restraints has been a good -thing within the United States, freedom of trade with other countries -would not prove equally advantageous. In answer to this, James G. -Blaine, formerly Secretary of State, wrote, “It is the enjoyment of -free trade and protection at the same time which has contributed to -the unexampled development and marvelous prosperity of the United -States.” Finally, the absence of tradition and of over-conservative -ideas handed down from a former and more primitive system of industry -has been a great boon. There have been developed traits of energy, -inventiveness, and ingenuity, which, aided by a universal system of -compulsory free education, have contributed greatly to the material -progress of the people. - -The system under which the production of wealth in a modern industrial -nation is carried on is usually called the factory system, and to this -we must now turn, for it is in the factory that the utilization of -machinery and capital finds its greatest development. The term is not -easily defined, but we may adopt the description given by the late -Carroll D. Wright: “A factory is an establishment where several -workmen are collected for the purpose of obtaining greater and cheaper -conveniences of labor than they could procure in their own homes, for -producing results by their combined efforts which they could not -accomplish separately, and for preventing the loss occasioned by -carrying articles from place to place during the several necessary 32 -processes to complete their manufacture.” The essential elements in -such a system are the minute division of labor, the large use of -labor-saving machinery, the increasing specialization and localization -of industry, and the concentration of production in fewer and larger -establishments with consequent increase of product and reduction of -cost. - -The division of labor may mean either the separation of occupation or -the division of a process into minute parts. An illustration of -separation of occupations may be found in the manufacture of a -carriage: one factory produces hubs, another wheels, a third axles, a -fourth the body, a fifth manufactures upholstery, a sixth the -hardware, and a seventh (the carriage factory, so-called) assembles -the parts and places the completed product on the market in the form -of a carriage. - -As an example of an extreme division of labor the slaughtering and -meat-packing industry offers a classical example, though in this case -the use of complex machinery is not involved. “It would be difficult,” -writes Professor Commons,[2] “to find another industry where division -of labor has been so ingeniously and microscopically worked out. The -animal has been surveyed and laid off like a map; and the men have -been classified in over thirty specialties and twenty rates of pay, -from 16 cents to 50 cents an hour. The 50-cent man is restricted to -using the knife on the most delicate parts of the hide (floorman) or -to using the axe in splitting the backbone (splitter) and, wherever a -less skilled man can be slipped in at 18 cents, 18½ cents, 20 -cents, 21 cents, 22½ cents, 24 cents, 25 cents, and so on, a place -is made for him, and an occupation mapped out. In working on the hide -alone there are nine positions, at eight different rates of pay. A -20-cent man pulls off the tail, a 22½-cent man pounds off another -part where the hide separates readily, and the knife of the 40-cent -man cuts a different texture and has a different ‘feel’ from that of 33 -the 50-cent man. Skill has become specialized to fit the anatomy.” - -Usually, however, when the division of labor becomes as minute as that -described, the routine-like process is handed over to a machine. -Indeed Mr. John A. Hobson states as a law of machine industry the fact -that as soon as a process becomes perfectly automatic and mechanical a -machine is invented which can do the work better and more rapidly than -human hands. Hand in hand, therefore, with the subdivision of labor -goes the extension of labor-saving machinery. Labor becomes relatively -of less importance than capital in the new methods of production, and -man becomes a machine tender rather than an independent producer. -There are practical benefits and disadvantages connected with this -system. Many writers insist that the effect on the worker is narrowing -in the extreme, but Professor Marshall points out that his labor as -tender of a machine demands a higher order of intellectual development -than that of a handicraftsman, and that he has more leisure, while the -product of the present system is immeasurably greater than under the -old hand methods. The manufacture of products by machinery has in turn -required the making of machines by machinery, as the complex machines -of today could not be turned out by hand methods. A characteristic -feature of the modern factory system therefore has been the growth of -the machine trades, which supply the equipment of the new industry. - -With the growing specialization of industry there has gone on an -increasing localization in some favored spot or locality. Thus most of -the collars and cuffs (85 per cent) manufactured in the United States -are made in Troy, N. Y.; 64 per cent of the oyster canning is carried -on in Baltimore; 54 per cent of the gloves are made in Gloversville, -N. Y.; 48 per cent of the coke in Connellsville, Pa.; 48 per cent of 34 -the brassware in Waterbury, Conn.; and 46 per cent of the carpets in -Philadelphia. While there are undoubted advantages in such -localization and specialization in a particular industry, such as -reputation, growth of special skill, etc., there are also offsetting -disadvantages, as the complete prostration of the whole community if -the particular trade upon which it depends is disastrously affected by -trade depression or by a shifting of the industry to some other -locality. - -More striking than the concentration of manufactures in particular -places has been its concentration in a few large establishments and -under the control of fewer individuals. Without entering into the -discussion, as yet, of the trust problem, we may at this time take up -the earlier and important tendency of industry to be conducted on a -large scale. This concentration into a relatively smaller number of -establishments has been going on pretty steadily since 1850 and shows -no signs of abatement at this time. In the case of the iron and steel -industries, cotton manufactures, and leather goods, the movement is -positively startling, an actual decrease in the number of -establishments having occurred in the half century. This is most -marked in the monopolized industries. At the same time there has gone -on an enormous increase in the size of the individual plant, in the -capital employed, the number of men employed, and the value of the -product. Almost the only industries which have not yet displayed this -tendency are those which are essentially local in their nature, as -grist mills, cheese and butter factories, etc. But in general it is -characteristic of manufactures in the United States. The same tendency -has been manifest in the countries of Europe, though there a system of -well-developed and fairly vigorous hand trades has resisted the -movement and made the development in this respect much less rapid than -in this country. - -Large-scale production is more profitable than production on a small 35 -scale in all industries which are subject to increasing returns. By -this is meant that the return in product for each additional dollar’s -worth of labor and capital employed grows greater the larger the scale -on which the enterprise is conducted. When this is true the big -enterprise will be able to undersell the little enterprises and -eventually to drive them out of business. This is true not only in the -competitive industries, but also in those which enjoy a legal or a -natural monopoly, as street railways, gas and water plants, etc., all -of which show an irresistible tendency to consolidation. Before -drawing any conclusions as to the desirability of such a movement, let -us examine some of the economies of large-scale production. The most -striking and the most important is the economy in fixed capital. -Concentration is a result of machine production. As machinery becomes -more expensive, the breaking up of the processes of manufacture into -small parts requires more complex and detailed machinery; a larger -outlay is requisite for an up-to-date plant. Thus the average amount -of capital invested in each iron and steel establishment in the United -States increased from $47,000 in 1850 to $858,000 in 1900. The head of -a steel company in Pittsburg recently testified before the Industrial -Commission that to build and equip a plant for the manufacture of iron -and steel under modern conditions would call for an investment of from -$20,000,000 to $30,000,000. It is clear that under such conditions of -expensive machine methods a small plant would have little chance of -existence. Steam railways afford another good illustration of an -industry in which enormous economies are effected by the concentration -of a number of small, independent lines under one unified control. -Every machine is utilized to the utmost; there is no needless -duplication of machinery such as would occur if several small plants -divided up the business, while expensive machines to carry on 36 -relatively small processes can be profitably installed. - -But other economies than those in the use of capital are present in -large-scale production. A large concern can hire more expensive and -better managers, can afford to experiment with new methods, can effect -a more minute and economical division of labor, as for example in the -slaughtering business above referred to. A striking economy can also -be effected in the utilization of what were formerly waste products, -and still are in small concerns. This has been carried furthest in the -oil-refining and meat-packing industries; a recent statement of Swift -and Co., for instance, alleged that the dividends on the stock were -paid out of the by-products, such as neatsfoot oil, land fertilizer, -glue, fats, etc. Owing, however, to the generally wasteful methods -prevailing in the United States not so much attention has been given -to this point as in England and Germany. A final economy may be -mentioned that can be secured by a large business, namely, carrying on -allied or subsidiary processes. Thus the Standard Oil Company builds -its own pipe lines, makes its own barrels, tin cans, pumps, tanks, -sulphuric acid, etc. - -Such an extension in the size of the single establishment would of -course not have been possible if improvements in the arts of -communication and transportation had not at the same time immensely -widened the market. As long as the market was local, and a factory -could afford to send its goods over only a limited territory there was -of course a fixed limit to the expansion of that industry. Now, -however, when markets are often world-wide and the demand for goods -has so enormously increased, while the modern railway and steamship -can transport goods cheaply and quickly half around the globe, -enterprises can be expanded and carried on on a scale commensurate -with the expanded market and improved methods. It is clear then that -the tendency to production on a large scale is the logical result of 37 -machine methods, that it secures great economies, and that in -industries of increasing returns it is absolutely inevitable. - -But not only in manufacturing is this movement observable. More -recently concentration in large establishments has revolutionized the -retail trade. Department stores have supplanted the small shops -because they can buy on better terms, get transportation cheaper, -offer a greater variety to the customer at a lower price, and save -time and trouble to the customer. The growing ease of communication -with central shopping districts, the rapid changes in fashion with the -consequent large variety which only a large establishment could afford -to carry--all these factors have helped along the movement. There are -limits to such a movement, for small tradesmen will always hold the -repairing trades, and the sale of perishable goods; thus there are no -businesses so scattered as the small stores of the “butchers and -grocers.” But on the whole we may safely conclude that the small -storekeeper is doomed now just as the small manufacturer was two or -three decades ago. In the carrying trade country carriers and a few -cabmen in the cities are the only survivals of the small independent -business; the steam railroad and the electric railway have driven the -small carrier out of business. In agriculture alone, where -concentration is strictly limited by the necessity for intensive -cultivation, and in professional and personal service, where the very -nature of the business prevents it, is there little or no development -in the direction of large-scale methods. - -The industrial and social effects of this development have been marked -in all countries. In the United States the main attention has been -given to the organization and development of machinery, and a -wonderful industrial advance has followed the movement. The economic -readjustments have consequently been made with comparative ease, and -the labor set free by the invention of new machines has been 38 -reabsorbed in the same or other industries. Consequently the social -effects have not been so marked as to call for special emphasis; as -the same question presents itself, however, in connection with the -more recent trust movement we may profitably defer its discussion to -the next section. - -There is one other characteristic feature of modern capitalistic -machine industry which deserves special mention, especially as its -development has been carried furthest in the United States. Reference -is made to the system of standardization and of interchangeable parts. -In no single feature is the contrast between modern machine methods -and those of the old hand trades greater. By standardization is meant -the production of so-called “standard products” according to some -acceptable size, form, or shape. In the manufacture of screws or iron -beams, or even ready-made clothing, for example, certain dimensions -and sizes which are best adapted for general use, are selected as -standard sizes and these are then turned out in large quantities by -automatic machinery. The advantages of such a system, in cheapness, -quickness of delivery, ability to replace a single broken part, etc., -are numerous and manifest. “The possibilities of standardization are -strikingly shown in a recent international incident. The Egyptian -Government desired a bridge for the Atbara at the earliest possible -moment; inquiry was made of the English bridgemakers, but no promise -of prompt delivery could be secured. Within twenty-seven days after -the tender of the contract was made to an American firm the bridge was -ready for shipment. The feat, not a remarkable one, was due to the -standardization of bridge material. This in itself was a guarantee of -quick delivery and construction.”[3] - -Standardization was followed by the system of interchangeable parts, -according to which each part of an intricate machine or product is 39 -made exactly like the same part in every other machine. The parts can -thus be turned out in large quantities and “assembled” at a single -operation. From the standpoint of the consumer or user of the machines -thus made, the great merit of the system lies in the fact that he can -quickly and at small expense duplicate any broken part. It is today -applied to almost every product of large consumption, from -agricultural implements and steam engines to watches and nails. By -producing machinery on this plan it has been possible for American -manufacturers to extend their trade very materially in foreign lands. -It was recently reported in the newspapers that Mr. E. H. Harriman had -expended $65,000,000 in standardizing the equipment on his railroad -systems; while this sum is enormous, it will undoubtedly be justified -by the increased economy of repairs and operation. - - - - -V. TRUSTS AND MONOPOLIES. - - -We have already seen how production upon a large scale has superseded -production upon a small scale in most important branches of -manufactures. We have now to inquire whether production upon a large -scale is in turn to be supplanted by single consolidated enterprises, -by those combinations of capital known as trusts. Under one of these -three conditions industry must be carried on; few people wish to -revert to the stage when production was carried on in small -establishments, but warm controversy and difference of opinion still -exist as to whether centralized management by a single company or -combination offers superior advantages to production by independent -competing establishments. The concentration of production in a few -large establishments has been followed by the consolidation of these -larger units into a single whole. Since the days of Adam Smith capital -has tended to combine for the purpose of fixing prices, and these 40 -combinations have passed through several phases. The earliest form is -the agreement of independent concerns to fix prices, as was done by -the American railroads in their early traffic agreements. The next -step was to divide the field, as has been done by the French railways -and the American express companies. A third phase of combination was -the pool, which attempted to regulate the output rather than to fix -the price or divide the field. Railway, whisky, beam, and other pools -were organized for this purpose, but all broke down because of the -difficulty of enforcing the agreement and the temptations to each -member to break it secretly for the sake of the large profits -obtainable. By this time it had become clear that if a real permanent -consolidation of interests was to be secured by the competing -enterprises some closer form of combination must be devised which -could not be broken at will by any member. An industrial union and not -a loose confederation must be attained. Accordingly the next step was -taken in 1882 by the formation of the Standard Oil Trust, so called -because the constituent concerns handed over their business to the -complete control of a central board of trustees, receiving in return -trust certificates which entitled them to dividends. Similar “trusts” -were formed in the whisky, sugar, and other industries, but were -speedily declared illegal by the federal Supreme Court. By this -decision the form of combination was changed, but the movement was not -at all checked. The next phase and the last was the establishment of -holding corporations, which are organized to buy up and hold the stock -of a number of individual corporations, which still retain their -corporate existence. In this way unity of control is secured, to which -is added a certain flexibility; but it is really the trust under -another legal form. Where pooling and combination by means of holding -companies have been forbidden by law, as in the case of railroad -companies, actual consolidation has often taken place, though when 41 -trusts are spoken of the other form of combination is more often -meant. From the point of view of business organization the holding -company is simply an extension of the principle of the corporation, -and to a consideration of this we must therefore turn. - -There are three classes of establishments by which industry is carried -on--those that are the property of an individual, those which belong -to partnerships or firms of unlimited liability, and those belonging -to corporations of limited liability. The usefulness of the individual -system is of course limited to small undertakings, where but little -capital and credit are necessary; this form of organization still -dominates the field in agriculture, in the small retail trade, and in -the repairing industries. The partnership is a joint undertaking by -two or more individuals, and makes larger enterprises possible, but as -each individual is liable for all obligations of the firm or his -partners his personal liability is greatly increased. While it is well -adapted to certain undertakings, as moderate mercantile establishments -and professional firms, owing to a certain elasticity in the -contractual relations of its members, it is not suited to large -industrial ventures, both because of the excessive personal liability, -and because of the necessity of dissolving the partnership upon the -death, withdrawal, or insolvency of any member. The advantage of the -corporation lies in the fact that it has a continuous existence, and -that the liability of the shareholders is limited to the amount of -capital actually contributed by each; it is well adapted to modern -enterprise because it permits the summation of large amounts of -capital from a number of small savers and centralizes the use of this -capital in the most economical manner. There may thus be concentration -of management without concentration of ownership. The federal census -of manufactures in 1905 showed that, although less than one-quarter of -the manufacturing establishments were organized as corporations, yet -they produced three-quarters of the total manufactures in money 42 -value. In the field of transportation, corporations are in almost -exclusive control, most banks and insurance companies are organized -under this form, while mercantile and industrial undertakings are -being more and more generally organized as corporations. Not merely -are most of our business enterprises being conducted under corporate -form and organization, but most recently, as has been already pointed -out, there has been a movement to combine individual corporations into -larger concerns, or trusts. The trust is usually thought of as a -monopoly and, while not necessarily so, it usually does exercise -monopoly control; but for the present we shall consider the trust -problem from the standpoint of business organization, deferring to the -end of the section the discussion of monopoly. - -The trust movement may be said to have begun with the formation of the -Standard Oil Trust in 1882, but down to 1898 its progress was slow. -Beginning with the revival of prosperity in 1898, however, there -ensued a veritable stampede of business managers to enter into -combinations. During the next three years 149 large combinations, with -a capital of over $3,000,000,000, were formed. The movement spent most -of its force by 1902, though it is by no means at an end yet, as the -recent floating of the Dry Goods Trust indicates. A few figures from -reliable authorities will make clear the extent of the movement. -According to the New York Journal of Commerce, industrial (i.e., -manufacturing and commercial) and gas trusts were organized in the -United States between 1860 and 1900, not including combinations in -banking, shipping, railroads, etc., as shown in the accompanying -table. - -Another more recent list by John Moody[4] gives the number of -“industrial” trusts organized down to Jan. 1, 1904, as 318; these have - - -----------------+------------+--------------- 43 - Decade. | Number | Total Nominal - | Organized. | Capital. - -----------------+------------+--------------- - 1860-69 | 2 | $ 13,000,000 - 1870-79 | 4 | 135,000,000 - 1880-89 | 18 | 288,000,000 - 1890-99 | 157 | 3,150,000,000 - -----------------+------------+--------------- - Total, 40 years | 181 | $3,586,000,000 - -----------------+------------+--------------- - -acquired or control 5,288 plants, and have a total nominal capital of -$7,246,342,533. A movement so general and widespread, and of such -gigantic proportions, must have had some powerful and intelligible -causes behind. For it was not confined to the United States, but was -equally observable in such industrial diverse countries as England, -France, Germany, Russia, and other European nations. - -The most important and general cause was the desire to secure the -legitimate economies of large-scale production. A combined or -federated industry may secure even greater economies than a single -large factory. These have been concisely stated as follows[5]: “The -cost of management, amount of stock carried, advertising, cost of -selling the product, may all be smaller per unit of product. A large -aggregation can control credit better and escape loss from bad debts. -By regulating and equalizing the output in the different localities, -it can run more nearly full time. Being acquainted with the entire -situation it can reduce the friction. A strong combination has -advantages in shipment. It can have a clearing-house for orders and -ship from the nearest source of supply. The least efficient factories -can be first closed when demand falls off. Factories can be -specialized to produce that for which each is best fitted. The -magnitude of the industry and its presence in different localities -strengthens its influence with the railroads. Its political as well as -its economic power is increased.” - -Many of these economies of production are not new to these trusts, but 44 -have been secured equally by large-scale manufacturing establishments. -Some of the savings, especially in buying raw material and marketing -their products, are peculiar to the trusts and mark a more efficient -mode of organization than mere concentration of industry in single -large establishments. Thus, it has been found possible to dispense -with a great number of traveling salesmen, of whom it was said that -30,000 lost their positions in the year 1898 alone. When the whisky -trust was formed only twelve of the eight distilleries entering into -the combination were kept running, but as these were the largest, best -located and best equipped, and were run at their full capacity, they -were able to turn out as much as all had done before and at an immense -economy. The saving of cross freights by having an order filled from -the plant most conveniently located is considerable; Mr. Gates -estimated the saving of the American Steel and Wire Company in this -single point at $500,000 a year. Such an economy could not be secured -by a single establishment, no matter how well organized or on how -large a scale. The specialization of particular factories to do -special processes is well illustrated by the organization of the -United States Steel Corporation. - -The growth of this latter combination is an example not only of -consolidation, but of the integration of industry, that is, the -grouping together under one control of a whole series of industries. -From the mining of the ore and coal, through the processes of carrying -it to the furnaces, coking the coal and making the pig iron, -manufacturing the latter into the finished forms of iron and steel -products, and down to the marketing of the latter, every step is -carried on under the control of the United States Steel Corporation. -The assets of the company were stated as follows soon after its -organization, and illustrate the magnitude and scope of its operations: - - Iron and Bessemer ore properties $ 700,000,000 45 - Plants, mills, machinery, etc. 300,000,000 - Coal and coke fields 100,000,000 - Railroads, ships, etc. 80,000,000 - Blast furnaces 48,000,000 - Natural gas fields 20,000,000 - Limestone properties 4,000,000 - Cash and cash assets 148,251,000 - -------------- - Total $1,400,281,000 - -In addition to economies due to improvements in methods of -organization, production and marketing, another cause for the sudden -and vigorous outburst of trust promotion in the years 1898-1902 may be -found in the profits to be secured by promoters and organizers. After -the successful launching of the first few trusts, with their undoubted -economies and advantages, the movement was taken in hand by -professional promoters, who organized combinations, often with the -help of underwriters, in every branch of industry where there was any -promise of profit. That many of these were artificial or premature is -evident from the financial results: of the 183 industrial combinations -enumerated by the census in 1900, one-third paid no dividends whatever -after their formation and another one-third paid no dividends to the -holders of common stock. As an indication of the profits obtained by -the successful trust promoter may be cited the testimony given before -the Industrial Commission in the case of the Tin Plate Trust stating -that this promoter realized from $2,000,000 to $3,000,000 profit from -the undertaking. When to this is added the profit obtained by the -owners of the constituent plants, which were usually taken over by the -trust at an exorbitant valuation, it is clear that the stimulus of -financial gain was probably stronger in many cases than that of -economy in production. The bill was of course paid in most cases by -the investing public, which absorbed large amounts of industrials in -the years of their active promotion. - -Other causes have sometimes been adduced to explain the growth of 46 -combinations, such as the tariff and railroad freight discriminations, -but these are too local in their influence to explain adequately the -world-wide movement toward combination. Trusts exist in free-trade -England, and in Germany where freight discriminations on the -state-owned railroads are practically unknown. It is, however, true -that in the United States both these factors have been of decisive -importance in building up certain powerful trusts. “There can be no -doubt,” said the conservative report of the Industrial Commission, -“that in early times special favors from railroads were a prominent -factor, probably the most important factor, in building up some of the -largest combinations. The receipt of discriminating favors from -railroads has been conceded repeatedly by representatives of the -combinations themselves.” The Standard Oil, beef, coffee, steel, and -other trusts may be cited as illustrations. In the matter of the -tariff Mr. Havemeyer’s statement that “the mother of all trusts is the -customs tariff law” may be set down as the rather peevish utterance of -a disappointed beneficiary; but there is no doubt that combination has -been made easier behind the tariff wall. Instance the sugar trust -itself, the leather, steel, tin plate, and others. - -Let us now turn to some of the effects of industrial combinations, -which we may classify according as they bear upon competitors and -producers of raw materials, labor, and consumers. As the number of -competitors is reduced the fierceness of competition among those -remaining in the field is greatly increased, for the value of the -prize to the successful enterprise is correspondingly greater. It is -not surprising therefore that at times this rivalry should have -assumed unethical if not actually illegal forms. The practice by some -trusts of fixing prices below cost at some strategic point in order to -crush out a troublesome competitor, and then correspondingly raising -them elsewhere so as not to sustain any loss, is serious because so 47 -subtle. Prof. John B. Clark regards this as so serious an evil that he -would have the Constitution amended in order that power might be given -the Federal Government to prevent it. The producers of raw materials, -as cattlemen, crude oil and coal producers, sugar and tobacco growers, -and others, complain that the prices at which they sell their products -are dictated to them by the trusts, which are practically the sole -purchasers of what they have produced. They claim that prices are -depressed to the lowest point possible and that every gain from -increase of demand goes into the pockets of the trust managers. It may -of course be answered that the trust cannot depress prices below the -point at which a living profit can be secured by the producer of the -raw material or he will stop producing, but there is no doubt but that -the monopoly power possessed by the trust in such cases will sometimes -be used to the disadvantage of those whose product it alone buys. - -The effects upon labor of the organization of capital in combined -industries and under centralized control are more complex. As trusts -have superseded single corporations because this mode of industrial -organization was more economical, we must expect to find that one of -the economies was the displacement of labor. The discharge of -traveling salesmen has already been spoken of; with the consolidation -of various plants under one control other high-priced men were let -go--managers, superintendents, etc. The same thing was true at the -other end of the industrial scale and thousands of workmen, usually -the least efficient and capable, were deprived of work. The natural -consequences of these combinations and economies were not clearly -apparent at the time, because they were happily coincident with a -period of business expansion and prosperity which reabsorbed into the -industrial organism most of the displaced workers. Another phase of -the relation between trusts and labor is that of their effect upon -wages. - -In general it may be said that there are only two sources out of which 48 -an increase of wages can be paid, and these are the profits of the -business organizer and manager or the increased product of the -business itself, and of these two only the latter can serve as a -permanent source of higher wages. Now it is pretty evident that labor -has not been in a position to force the trust magnates to forego their -profits. On the other hand, wages in industries carried on by -industrial combinations have risen, and it must therefore have been -because there was more produced and consequently more to be divided. -If the inefficient workers were discharged and only the best ones -retained by the trusts, here is one explanation why they could afford -to pay high wages--they paid more because they got more done. As yet -labor has not admitted that it is unable to cope with these industrial -combinations; it has however demanded that it be allowed to combine on -a national scale and to bargain collectively for united labor with -combined capital. - -The discussion of the effects of trusts upon the consumer leads at -once to the discussion of their effects upon prices, for it is through -the agency of price that the trust touches the ordinary man. The -advantages claimed by trust organizers are economies of production and -lowered cost; but the vital question to the consumer is whether -lowered cost increases profits or reduces prices. On this point the -Industrial Commission reaches the following conclusion: “that in most -cases the combination has exerted an appreciable power over prices, -and in practically all cases it has increased the margin between raw -materials and finished products. Since there is reason to believe that -the cost of production over a period of years has lessened, the -conclusion is inevitable that the combinations have been able to -increase their profits.” Moreover the power over prices was greatest -during certain periods when the control of the combinations was -greatest. The problem therefore resolves itself into the question, 49 -are trusts monopolies? While a categorical answer cannot be given to -this, it may safely be affirmed that all trusts try to be monopolies. -Nor is it necessary to control the production, sale, or purchase of a -commodity absolutely in order to exercise monopoly power; the control -of 50 or 60 per cent may suffice to secure virtual monopoly. The -purpose of a monopoly is so to fix the price that it will obtain the -maximum net profit. It is conceivable that this result may be attained -by lowering the monopoly price below the point of the competitive -price, but this is unusual. In general a monopoly price has meant a -high price, and a high price has meant a restriction of the output. -Where that has been the result of trust control, society has been -injured, for not only has it not shared in the economies of production -but it actually gets less and has to pay more than it would have done -under competition. It may be said, however, that even in the case of -the greatest monopoly there is always the specter of potential -competition threatening its profits, while the possibility of -substituting some other commodity for the monopolized article protects -the consumer from too great extortion and keeps the price within -limits. Absolute control over price is never exercised by any -monopoly. Nevertheless, we may fairly conclude, in the words of Henry -D. Lloyd, that “monopoly is business at the end of its journey,” -control over prices is the object of combination. - -There remains to be considered another charge of monopoly which has -been brought against the trust, the monopoly of opportunity or the -suppression of individual initiative. It is no longer possible, it is -claimed, for the man of small means, even with good talents, to engage -in business for himself: he must accept some subordinate position in a -corporation where his individuality is checked and his power of -initiative does not find free play. So far as this is true it would -seem to be the result not so much of the trust movement as of 50 -large-scale production. We have seen that the tendency of machine -production is to enlarge the business unit and to call for the -investment of constantly larger amounts of capital in up-to-date -establishments. Some writers even point out that the average business -man who engages in business on his own account fails, and that he -should therefore be grateful if more efficient producers offer him a -remunerative and steady salaried position. Without insisting upon this -point it may still fairly be noted that there are large fields of -enterprise that lie outside the area of monopolistic control. -“Large-scale production is best adapted to articles that can be turned -out in large quantities according to uniform patterns and standards; -individual initiative is still free in those lines of production that -call for artistic ability or appeal to individual tastes, or which, -like agriculture, are dependent upon variable conditions.”[6] - -There are, however, other evils connected with trust organization and -management that are more easily remediable and that call for -legislative regulation. “The evils of combination, remedied by -regulative legislation,” concludes the report of the Industrial -Commission,[7] “come chiefly from two sources: (1) the more or less -complete exercise of the power of monopoly; (2) deception of the -public through secrecy or false information.” Various remedies have -been suggested to meet the first class of evils, those of monopoly, -generally in the direction of strengthening the powers of the Federal -Government. We have however no lack of legislation on this subject -already: thirty-four states and territories have passed anti-trust -laws, and the federal Anti-Trust Law of 1890 explicitly provides that -“every contract, combination in the form of a trust or otherwise, or -conspiracy in restraint of trade or commerce among the several states, -or with foreign nations, is hereby declared illegal.” The severe 51 -restrictive measures of the states have been largely nullified by the -loose legislation of three or four “charter granting” states, in which -95 per cent of all the trusts have accordingly been chartered, while -the federal enactments have been found very difficult to enforce. It -is not easy to define or to prove monopoly or conspiracy in restraint -of trade. The second class of evils has been met by statutes requiring -publicity and more definitely fixing the responsibility of corporation -officials. Such measures of control must be the first step toward -intelligent regulation, and are to be commended as thoroughly -reasonable. The establishment of the federal Bureau of Corporations -with power to “investigate” industrial corporations engaged in -interstate commerce has already led to the publication of some -valuable reports. We must first proceed along the lines of publicity -and intelligent information before we attempt more drastic remedies. - - - - -VI. SPECULATION AND CRISES. - - -An unavoidable element of risk enters into all modern business. In the -old handicraft stage of industry goods were made upon order; demand -preceded supply very definitely, and there was little possibility of -mistakes in production. Nowadays, as we have seen, production is for a -distant and often uncertain market. It is carried on by machine -methods and roundabout processes; sometimes the result is a very -remote one and the uncertainty of success is correspondingly great. -Production is not based upon order, but upon a forecast of the -possible demand, upon a future market. Chance and change are -inseparable from productive enterprise--natural chances from the -elements, political changes, as war or unfavorable legislation, -industrial mistakes or sickness or death of oneself or others, and -economic changes, as the invention of a new machine or a change in -fashion. These are the unavoidable incidents in industry and are not 52 -under the control of the individual business. Some of them, however, -are so regularly recurrent that they can be foretold on a large scale -for any industrial society, and can be guarded against by insurance. -Everyone recognizes the desirability of having such risks as those of -fire, shipwreck, lightning, death, etc., assumed by certain -individuals or companies who make a business of such risk-taking. A -small premium is paid by the individual for protection, and he is -freed from anxiety from mischance and is able to devote his whole -energies and capital to his business; the insurance company has -specialized in this one department and by equalizing the chances over -a wide field has practically eliminated them. In doing this it -performs a service of recognized and undoubted social value. - -There is another kind of risk-taking the social utility of which is -not at first sight so clear. Among the chances of productive -enterprise are those due to the rise and fall in the prices of the raw -materials, the labor, and the finished product between the time when -the process of production is begun and the time when it is completed. -Every farmer, every manufacturer, every student even who invests -capital in his own education, is to some extent a speculator. Along -certain lines he can protect himself by insurance, but that is not -possible in all. Is there no way, then, by which he can guard himself -against price fluctuations and assure himself of the legitimate gains -of his business? This, it may be answered, is the function of the -speculator in modern business, and in performing this service he is -benefiting society in much the same way that the insurance company -does. We must, however, clearly distinguish between legitimate and -illegitimate speculation; we are discussing only the former. - -One way in which the speculative risk attaching to price fluctuations -is reduced for the manufacturer and assumed by the speculator is by -the establishment of a continuous open market, as the stock and 53 -produce exchanges. If a miller, for instance, engages to deliver flour -a year hence and expects to begin milling in six months, he must know -at what price he can buy his wheat when he needs it, or his -anticipated gain may be turned into a loss by an unexpected rise in -the price of wheat. He is able, however, to buy a “future” in wheat on -the produce exchange from some broker who makes a specialty of this -business. He buys his needed wheat now for delivery six months hence, -and on the basis of this price is able to accept an order for his -flour a year from now, allowing himself a fair profit as a miller but -wholly eliminating the speculative risk of price fluctuations. Or a -building contractor, before making an estimate of the cost of erecting -a structure, will secure options at definite prices from dealers on -the materials he will require. So, too, in the iron and steel business -it is customary for manufacturers to contract in advance for materials -at the same time that they accept orders for the delivery of the -finished products. In all these cases the business of dealing in -futures is assumed by a particular class, who have developed a special -skill and ability in forecasting price variations, and who can do so -very accurately. It is not a matter of luck or chance, but the result -of wide knowledge and careful study. “To foretell the price of wheat -one must know the rainfall in India, the condition of the crop in -Argentina, must be in touch as nearly as possible with every unit of -supply that will come into the market.” Sometimes the speculators make -mistakes, but they are certainly less apt to do so than men who are -without their special talent and training. - -The social value of this service lies in the equalization of demand -and supply between the present and future that is thereby effected. -Let us take as an illustration the case of the miller cited above. If -at the time he accepts the order for flour the price of wheat is high, -he will be inclined to charge a high price. But the wheat broker, -foreseeing that there is going to be an abundant crop six months 54 -hence, engages to sell him his wheat for future delivery at a low -price, and he is thereby enabled to sell his flour at a lower price. -At the same time the price of the wheat on hand at the present time, -instead of being held and sold at famine prices, is consumed for -present needs at moderate prices. The operations of the wheat brokers -in such a case have a very steadying influence on prices, preventing -the oscillation between very high prices in times of scarcity and very -low prices in times of glut. It must be admitted that dealings in -futures are highly speculative; “but it must be remembered that it is -not merely the dealings in futures, but the future itself, that is -uncertain. If such dealings can be confined to the men most competent -to make accurate predictions, their tendency will clearly be to lessen -the uncertainties of business.”[8] But closely connected with -legitimate speculation or risk-taking by a specialized and trained -class, there is, as our stock and produce exchanges are actually -conducted, a large amount of illegitimate speculation, and to this we -may now turn for a brief consideration. - -The facilities offered by the open markets on the exchanges and the -practice of dealing in futures are taken advantage of by many who, -without any special training or opportunities of knowing the market, -simply bet on the price movements. Brokers are willing to buy and sell -produce or stocks for their customers if the latter will put up with -them a margin of about 10 per cent to protect them from loss. It is -therefore possible for a person with little capital and no knowledge -to speculate on a margin, buying what he does not want and selling -what he does not own. In practice it is impossible to distinguish -between those dealings in which actual delivery is intended -(legitimate speculation) and those in which no such delivery is -contemplated (gambling), and consequently most efforts to regulate 55 -transactions on the exchanges have failed to accomplish their purpose. -The purification of their methods would seem to lie with the members -of such exchanges themselves. The contention has often been made that -these fictitious transactions in such commodities as wheat or corn or -cotton create an artificial reduction in prices, since the -professional gambler usually sells short or “bears” the market, and -that this injuriously affects the farmer. This is manifestly -untenable, since every fictitious sale must be balanced by a -fictitious purchase. What actually takes place is simply a bet between -the two parties to such a transaction on the actual course of prices -and of itself does not affect prices, except in the unusual case of a -“corner.” There is, however, great possibility of evil in the presence -of a crowd of uninformed speculators, for they can greatly increase -the power of an unscrupulous operator who can persuade them to follow -his lead. Their presence, too, increases the temptation to such a man -to rig the market. Under present conditions the abuses of speculation -are more in evidence than the economic advantages. How to confine -speculation to the small group of risk-takers who have special -training and aptitude for it, and to prevent gambling on the stock and -produce exchanges is one of the economic problems of the day. - -One of the most striking phenomena of modern industry is the frequent -and violent convulsions of business known as crises. They are -characteristic of all commercially advanced countries and are -generally most marked in those countries which are most advanced. They -are a product of modern methods of capitalistic production and are -essentially a phenomenon of the nineteenth century. A crisis in its -last analysis is the result of a lack of adjustment between production -and consumption, due primarily to mistakes in production. It is -significant that crises usually occur in periods of business -prosperity when credit is easy, prices high, and employment general. 56 -Such a period of business prosperity and rising credit may have been -begun by a series of good harvests. The demand for manufactured -commodities increases, prices rise, manufacturers enlarge their -factories or engage in new enterprises, wages and profits go up. Many -speculators, seeing the rise, and thinking it will continue, borrow -money to buy goods with the expectation of selling again at a profit. -Credit operations are expanded to a dangerous extent, and when at last -a shock to confidence occurs the house of cards collapses and a -painful liquidation and readjustment of industry ensues. The state of -trade, in the words of Lord Overstone, “revolves apparently in an -established cycle. First we find it in a state of quiescence--next -improvement, growing confidence, prosperity, excitement, over-trading, -convulsion, pressure, stagnation, distress, ending again in -quiescence.” - -The immediate occasion of a crisis is always a shock to credit or -confidence. Such a shock, begun perhaps by the failure of a bank or -merchant, creates a demand for ready money. No one is sure that his -neighbor will remain solvent. Everyone accordingly tries to secure -himself against loss by enlarging his cash reserve and thus lessens -the supply for others. Now modern industry is carried on by means of -credit. There is at no one time enough money in the country to meet -all obligations expressed in terms of money. Considerably over -three-fourths of the larger commercial transactions in the United -States are carried on by means of credit. If everyone tries at the -same time to get actual cash, there is simply not enough money in the -country to go around. This increase of demand and diminution in the -supply of money forces up the interest rate on short-time loans. -Money--actual cash--is needed by many people to meet immediate -engagements and they are willing to pay almost any price for it. In -the last panic the rates for call money went up to over 100 per cent 57 -and in many cities in the United States clearing-house certificates -and other substitutes for money were issued for use in ordinary retail -trade. But even at high rates money can often not be borrowed. Many -merchants and manufacturers are compelled to sell their goods at a -sacrifice in order to obtain it. Vast quantities of goods and -securities are thrown on the market just when investors and consumers -feel least able to purchase. The result is a fall in prices. Such a -fall in prices lowers profits. Enterprises have been started and -engagements made on the supposition that prices would continue at the -old high level. When they fall it is impossible to pay interest out of -current earnings. Foreclosures and readjustments take place. There is -a general liquidation and reorganization of industry. When interest -contracts have been adjusted, then the effect on wages begins to be -felt. As long as a manufacturer is struggling to maintain his credit -he will keep his factory going, but when he has failed and perhaps -been foreclosed, then the factory stops. Men are thrown out of work, -and wages--the price of labor--fall. Labor troubles usually mark the -end of such a period of readjustment. - -This stage marks the end of the crisis and the beginning of a period -of depression or “hard times,” which continues for a longer or shorter -period. The panic of 1893 was followed by a long-continued depression -which lasted until 1897, a period which was marked by low prices and -slack work. In 1898 began a revival of business and an era of marked -prosperity set in which continued for almost ten years, interrupted -only slightly by a “Wall Street panic” in 1903. In October, 1907, a -severe crisis occurred, recovery from which, however, has been -remarkably rapid. The periodicity which has attended crises in the -past is so marked--occurring as they have at intervals of about ten -years--that many writers consider them inevitable. As the easiest way -to answer this question we may take up three main theories as to the 58 -causes of crises. - -A much quoted, but now generally discredited, theory is that of W. S. -Jevons, a noted English economist, who ascribed crises to sun-spots. -Every ten years and a fraction there occur outbursts of electrical and -heat energy on the sun, which we call sun-spots. These result in -increased heat waves, which affect the crops on the earth, causing -enlarged harvests in Europe and the United States and drought and -famine in India and the tropics. The large harvests and good prices -start a wave of prosperity and speculation, which culminates -inevitably in a panic and depression, until a recurrence of the heat -phenomenon starts the cycle again. The theory states some undoubted -facts, but no causal connection between sun-spots and crises can be -traced, as the latter are too irregular and the two do not always -coincide. Were this theory true crises would be beyond human control. - -A second theory, or group of theories, are those which attribute -crises to over-production. Under modern conditions of industry a small -group of men direct industry and determine what shall be produced. -They try to estimate future demand and to adjust production to -consumption, but they often make mistakes. They divert capital into -unproductive industries, they produce the wrong things and create a -comparative glut in certain lines, and when they cannot sell their -goods at a profitable price they fail and precipitate a crisis. -Industry must then be reorganized and frequently control be put in the -hands of other men. A variation has been given this theory by the -socialists, under the leadership of Rodbertus, who insist that the -reason that there is over-production is because of the institution of -private property. Since the capitalists own all the tools of -production they pay the laborers only starvation wages. The latter -cannot possibly buy all that is produced and commodities consequently -heap up in the warehouses until they are thrown upon the market to be -sold at any price. Then a panic occurs and a readjustment of production. 59 - -The last of these theories regards a crisis as essentially due to a -failure of credit. It is seen that a large part of modern industry is -carried on by borrowed capital, by roundabout processes and for a -distant market and not upon order. That is, the success of a business -depends upon its ability to sell its goods when produced. Now the -aggregate volume of transactions that can be carried on in a year, so -runs the theory, depends upon the efficiency of the credit system; -that is, in general, upon the freedom with which banks are willing to -loan money to people who engage to repay it in the future out of their -ventures. If for any reason the banks reduce this accommodation the -amount of business that can be transacted upon borrowed capital is -lessened. Either some transactions must stop or prices must fall. -Either of these events causes commercial disaster. The contraction of -credit makes it impossible to get the goods into the right hands, and -so we have the phenomena of over-production in a great many lines. As -exchange and transportation have developed and markets widened, crises -have become more universal. According to this theory, they are -inseparably connected with the use of credit and can be controlled -only by a more careful granting of credit by the banks to industrial -managers. Another phase of the credit theory is presented by those who -insist that the cause of crises is the rhythmic overestimation of the -profits to be secured out of certain lines of production, or their -over-capitalization. The new enterprises are financed by the banks on -the basis of this mistaken over-capitalization, their organizers -engage to pay rates of interest which they cannot earn, and the crash -inevitably follows. This is often called the over-capitalization -theory, and is essentially psychological in its character. - -There is no doubt as to the truth contained in this last theory. It -helps to explain the rhythmic periodicity of crises. After every 60 -period of business depression confidence revives and hope is renewed; -overestimation of the success of new ventures is inevitable. Then -follows a mistaken investment of capital in certain lines of -production, as in railroads in 1884, and a relative over-production at -profitable prices of certain commodities. The true explanation seems -to be found in a combination of the over-production and -over-capitalization theories. - -The practical problem that presents itself in this connection is the -question as to whether it is possible to prevent the recurrence of -crises. In view of the explanation just given it would seem that they -must be regarded as unpreventable as long as industry is carried on -under the competitive capitalistic system of production and the modern -credit system. Moreover, crops differ in amount from year to year and -probably always will. Human production and human genius are unequal. -Crises may be regarded as the price a progressive society pays for its -advance, and they may be expected to recur pretty regularly at -periodic intervals. Their disastrous effects may, however, be greatly -lessened by wise currency legislation, by greater care in granting -credit, and by greater wisdom in the direction of individual effort. - - - - -VII. THE MODERN WAGE SYSTEM. - - -We have already characterized the modern system of industry as -capitalistic, that is, as involving the use of expensive and complex -machinery in factories under the control of the capitalist managers of -industry. As we have seen, such a system has caused an enormous -increase in the production of wealth; it has also raised the general -standard of comfort and the level of wages, and has relieved labor to -a considerable extent of the deadly strain of hard manual toil that -was characteristic of preceding systems. The factory system, under -which capitalistic production is now carried on, may also fairly be -credited with other beneficial results: as steadiness and punctuality 61 -are essential, it has on the whole led to increased sobriety and -temperance; the work in general is healthier, being performed under -better sanitary conditions than under the old domestic system; the -intellectual status of the workingman has been raised, as vastly more -intelligence is required of a skilled machine operator than of the -old-time hand laborer; and finally the general well-being of the -working class has been improved, as they have shared in the larger -production made possible by machine methods. But, on the other hand, -the new processes and methods have been accompanied by great abuses, -though never so great in this country as in England. Long hours, the -employment of women and children, the weakened economic position of -the laborer, fluctuations in production, liability to be without -employment, industrial accidents, the abolition of personal ties -between employer and employe, the crowding of workmen into a small -space to work by day and their concentration in city tenements by -night--these are some of the problems for which the factory system -must be held responsible. The condition and position of labor have -been vitally affected. So far we have considered mainly the problems -connected with the organization and use of capital. We must now take -up the various questions connected with the relation of labor to -capital and to the capitalistic system of production. - -One of the most vital factors in the situation--which we must frankly -admit at the start--is the existence in modern industrial society of a -distinct wage-earning class. It is perfectly obvious that under -present conditions of production great capital or great ability is -necessary in order to become the manager of an industrial enterprise. -Most laborers do not possess either the one or the other of these, and -although there are fortunate examples of industrial leaders who have -risen from the ranks, the general rule is, once a wage-earner always a -wage-earner. The number of those who can achieve industrial 62 -independence is moreover growing smaller as business becomes more -specialized and centralized. The laborer therefore belongs to a class, -which is rapidly developing what the German socialists call -class-consciousness, that is, the feeling that he belongs to a -distinct industrial group with interests different from and often -antagonistic to those of other groups or classes. In his struggles -with employers over wages this antagonism of immediate aims obscures -the deeper mutuality and interdependence of their really complementary -interests and not infrequently leads to a feeling of hostility, -finding expression in strikes and labor agitation. - -In the transition to the factory system Mr. John A. Hobson[9] points -out that the position of the laborer has been one of increasing -dependence in the following five important points: (1) The ownership -of material--at first the worker owned this and made it into the -finished product, but now he has only a passing interest in a small -part of the process of working it up. (2) Ownership of tools--he -retained these up to the time of the introduction of machinery, but -now seldom owns them. (3) Control of productive power--with the -displacement of hand labor and muscular power by steam-driven -machinery, he no longer owns even this. (4) Relations between workers -and employers--they were formerly on an equality; under the guild -system the master and the apprentice had the same social position; now -the laborer has sunk in the scale, or the employer has risen, until -the only bond between them is, as Carlyle said, the “cash nexus.” A -case was recently instanced where a workingman who had been working in -a factory met his employer for the first time at the end of seventeen -years. (5) Workplace--until the establishment of the factory system -this had always been the home; now it is the factory, and there is a 63 -complete divorcement between work and the home. - -Another characteristic of modern industry from the labor point of view -is the existence not merely of a wage-earning class, but, more -fundamental, of the wage system. “It is characteristic of the modern -industrial system,” writes President Hadley,[10] “that a laborer who -owns no capital, though nominally free to do what he pleases, must -actually find some property owner who will give him enough to keep him -alive during the period which must elapse between the rendering of the -labor and the sale of the finished product. Under such circumstances, -the laborer almost inevitably submits to the direction of the property -owner in deciding how his labor shall be applied. Laborers without -capital must necessarily work on this basis; even those who have small -amounts of capital habitually do so. Such advances of capital are -known as wages.” Here we have the essence of the wage system in a nut -shell. The laborer sells his labor to an employer for a stipulated -wage. He has a commodity, his labor, consisting of a certain amount of -strength and skill, which he is free to dispose of on the market to -the best advantage, as the owner of any other commodity might do. -Legally, labor is property. Owing, however, to the fact that all -modern production requires capital, the only buyer of his labor is a -capitalist, who directs the way in which the labor shall be applied. -Such a condition, as well as some peculiarities of the commodity labor -leave the laborer, indeed, only “nominally” free. In theory the labor -contract is a perfectly free contract, entered into voluntarily by -both employer and wage-earner, and the courts have generally insisted -that this theoretical freedom must be maintained. In practice various -modifications of the theory have taken place: legislation has been -passed protecting laborers from bargaining away their rights, and 64 -trade unions have been formed to bargain collectively for a group of -laborers. In the last analysis, however, the laborer must support -himself by the sale of his labor; society guarantees him neither a -living nor even the right to work. He is a bargainer in a competitive -industrial world and he must assume the responsibility of providing -for himself and his family by securing work. Just what is involved in -such a statement is perhaps best brought out by comparing the modern -wage system with previous systems of labor. - -The first historical system of labor, aside from that in the family, -was that of slaves. In this case the labor was forced, and being given -under coercion was probably very inefficient; but the laborer was at -least assured of a minimum of food, clothes and shelter. Slavery was -the main source of manual labor in the ancient world, and did not -disappear in England until the eleventh century. The feudal system of -the Middle Ages was characterized by serfdom, according to which the -laborer was bound to the soil and was compelled to render his lord -certain services. Gradually serfdom was broken down and the wage -system took its place, although remnants of serfdom remained in -England until the eighteenth century. Four centuries before this, -however, the disintegration of the feudal society had already begun, -the serfdom of the agricultural laborer was commuted into regular -money payments, and the artisan bought or otherwise secured his -freedom from feudal exactions. In the towns industry was regulated by -the guilds, and while at first they were distinctly beneficial, in -time they became monopolistic and oppressive. Power was lodged in the -hands of the wealthy traders and merchants and they legislated in -their own behalf against the growing class of laborers, as did the -wealthy land owners against the agricultural laborers. The Statute of -Laborers and other acts sought to fix wages and to prevent the freedom -of the laborer in moving about or choosing his own occupation. Not 65 -indeed until the nineteenth century were the last of these old -regulative laws repealed and the modern labor contract recognized in -law and practice as a free contract. “The growth of labor,” says -Brentano, has been “from the system of authority to the system of -contract.” The system of authority, by which rates of wages, length of -apprenticeship, and other details of industry were fixed by some -superior authority, was found to be restrictive, uneconomic and -unjust, and it gave way to the principle of economic freedom. -According to the newer theory, first given effective voice by Adam -Smith, in 1776, the individual should be left to himself, as he knows -his own interest better than does the most enlightened government. The -freest scope was given to the powers of individuals and each was to be -the unlimited master of himself and his possessions. - -It has since been found necessary, however, to modify both the theory -and practice of this extreme individualism in order to protect the -interests of various classes of society, especially the laborer. The -legal theory still is that “today the labor contract is perfectly -free: either side may make whatever contract he can get the other side -to sign. Not only this, but either side may freely combine to demand -any form of contract from the other side, as mere combinations alone -are now made perfectly legal.”[11] In practice, however, this complete -freedom has been greatly modified by factory acts, acts restricting -the hours and conditions of employment of women and children, -anti-truck acts, laws providing for weekly payments, guarding of -machinery, limiting the hours of labor, and on the other hand -prohibiting intimidation and molesting. For the most part these laws -have applied to women and children, who are thought less capable of -guarding their own interests, and to a much less degree to labor 66 -contracts made by men, who have been considered better able to make -equal contracts with employers. But concerning certain conditions of -employment it has been realized that even adult males are not capable -of securing equitable bargains, and along these lines the nominal -freedom of the labor contract has been decidedly abridged. The -attitude of the courts toward such legislation shows that they have -declared many laws unconstitutional on the ground that they infringe -upon the right of free contract, but in the long run seem inclined to -uphold as much of this restrictive legislation as seems necessary to -obviate the undoubtedly evil results that flow from this real -inequality of employer and laborer. - -It is a very vital and important practical economic problem that -presents itself in this connection. How far shall we carry this -regulative principle, or how far shall we insist upon the principle of -freedom? Many labor leaders are again asking for an effectual control -of the labor contract, not by the action of trade unions, but by the -direct legislation of the state. What shall be our attitude to this -demand? Before we can fairly answer this question we must consider -somewhat more fully the character of the bargain that takes place -between an employer and an individual workman, and the nature of the -commodity that the laborer has to sell. - -It has already been stated that the commodity which the laborer brings -upon the market is his labor, that is, himself, his time, and his -energies. But these wares are peculiar and differ in several important -respects from ordinary marketable commodities. In the first place, -labor is like a perishable commodity which must be sold at once if the -owner is not to incur loss. The laborer has usually little if any -capital by which to support himself in case he cannot find work, and -may be compelled to make a forced sale of his labor, that is, to -accept unduly low wages. In this respect then he is at a disadvantage 67 -in bargaining with his employer. A second peculiarity of the sale of -labor is that the laborer and his work are inseparable. The seller of -an ordinary commodity disposes of it absolutely when he makes a sale. -“It matters nothing to the seller of bricks whether they are to be -used in building a palace or a sewer; but it matters a great deal to -the seller of labor, who undertakes to perform a task of given -difficulty, whether or not the place in which it is to be done is a -wholesome and a pleasant one, or whether or not his associates will be -such as he cares to have.” The person who buys this labor necessarily -directs the application of it to the task in hand, and thus controls -very largely the place, the sanitary and social conditions, the hours, -the character, and safety of the work. In the third place, the -superior knowledge and intelligence of the employers gives them an -advantage in bargaining with their employes, while the reluctance of -employers to “spoil the labor market” often prevents that freedom of -competition which is supposed to secure to the laborer his full share -of the product he helps to produce. - -In view of these facts we may fairly conclude that workmen are -inferior to employers as bargainers and that protective legislation is -necessary in order to put them on a real equality. “When laborers have -to make a forced sale of their labor, their freedom of contract is -more nominal than real. When women and children stand individually -before the manager of hundreds of thousands of capital, it is possible -that there may be little freedom and less equality in the contract by -which they sell their services.”[12] It is clear that between two -parties of such unequal knowledge, resources and ability as a laborer -and his employer the labor contract cannot be entirely free and equal. -While trade unions, by combining isolated workmen into formidable -and unified groups, have immeasurably increased their bargaining 68 -strength, yet legislation has also been found necessary to remedy the -disadvantages already enumerated. It is realized that “there is no -greater inequality than the equal treatment of unequals.” In the -opening section of this text attention was called to the fact that -economic freedom or liberty was one of the corner stones of our modern -industrial society. But freedom can best be secured by securing -equality and responsibility. Factory legislation and labor laws are -designed to correct the inequalities imposed by nature or involved in -the very nature of capitalistic production. Direct interference by the -state in the freedom of contract is justified as leading to a more -real and certain equality and liberty. But while we may thoroughly -approve the principle of labor legislation it is difficult to know at -what point we should stop. A leading American authority on the law of -labor has stated[13] that “the industrial laborer at least is -beginning to be a privileged class in the law.” On the other hand, it -was possible for Disraeli to say as late as 1875, after the passage of -the Employers and Workmen Act by the British Parliament, “for the -first time in the history of this country employer and employed sit -under equal laws”--so recently were the legal disabilities removed -under which the English workmen had suffered up to this time.[14] The -pendulum has swung so rapidly and so far in labor’s direction in the -last generation that it is a fair question how far it will--or -should--continue to go. - - - - -VIII. LABOR ORGANIZATIONS AND COLLECTIVE BARGAINING. - - -As modern capitalistic production caused the growth of a distinct -wage-earning class and brought about a sharp separation between -employers and laborers, and as the latter were thrown upon their own 69 -resources under the prevailing theories of free competition and free -contract, it was inevitable that they should organize to secure their -interests as a class. The growth of labor organizations has been -greatest in those countries where the laborer has been forced to -depend mostly upon his own efforts for protection and improvement, -namely, in England and the United States. On the continent of Europe, -on the other hand, where the individual has been accustomed to look to -the government for the redress of industrial grievances, there has -been a much less vigorous and spontaneous development of such -organizations. They are a product of the nineteenth century and had -their origin in modern machine production. - -The growth of labor organizations in the United States has proceeded -hand in hand with the industrial development of this country, and has -been especially rapid since the Civil War. Two distinct types of trade -unions may be noted--the local and the national (or international) -unions. The former, which comprises members who live and work in the -same locality, is the primary unit, and dates back to the beginning of -the century. Each local union, even when subordinate to a national -organization, is a self-governing unit, and is absolutely democratic. -Its relation to the national body has been well compared to that of -one of our states to the United States. The first national union was -not formed until 1850, but now these far surpass the locals in -importance. Their government is representative, as they are made up of -local unions. The great majority of the national trade unions are -bound together in the powerful federal organization, the American -Federation of Labor. The membership of this body numbers considerably -over 1,000,000, while the railroad unions, which are not connected -with it, claim about 125,000 more. Probably not far from 1,500,000 -persons in the United States belong to labor organizations, which is -about 10 per cent of the total working population or about 15 per 70 -cent of those engaged in trade and transportation, manufacturing and -mechanical pursuits. While this does not seem a very large proportion -and is not as large as the membership of British trade unions, yet it -must be remembered that they constitute on the whole the elite of the -labor world and exercise an authority and power out of proportion to -their numbers. Many other workmen, who do not themselves belong to the -unions, follow their lead and are directly affected by their actions. - -Historically the two most important national organizations in this -country have been the Knights of Labor and the American Federation of -Labor, and they represent such different principles that it will be -worth while to describe them. The Knights of Labor was organized in -1869 as a local union of seven garment cutters and had a meteoric -career, counting a membership of 730,000 in 1886, the year of its -greatest strength. It was a national amalgamation of mixed local -assemblies composed of workers of all trades who lived in the same -locality. It held the theory that the interests of all members of the -laboring class are identical and must be cared for at the same time, -if possible, by political action, by co-operation, and by education. -In 1886, however, it entered upon a series of disastrous strikes; -later it came into conflict with trade unions which had not joined its -ranks and were opposed to its policies; and finally it became -entangled in politics. As it lost in influence and strength its place -was taken by the American Federation of Labor, which was its very -opposite in organization and government. This latter body is a -“confederation of trade and labor unions,” each trade being organized -separately into local unions which are given great autonomy, these -unions alone being represented in the national body. Only matters of -general interest come before it, all local trade matters being left to -the local unions. In 1903 it claimed a membership of 1,745,000. - -More important than the history of labor organizations is a knowledge 71 -of their objects and methods. The primary purpose is of course to -control the conditions of labor and to substitute the principle of -collective bargaining for individual contract. As one of the most -effective ways to secure this result they aim at a more or less -complete monopoly of the labor market. This they may do by bringing -all workers in a trade within the union or by preventing non-union men -from working. The first of these is called the inclusive method,[15] -and if successful makes the union the sole seller of the kind of labor -controlled by its members. It is a monopoly of the laborers against -the employers and is sought to be enforced by inducing men to join the -union either by persuasion or coercion, the latter finding expression -in the strikes against the employment of non-union men and the -insistence upon the “closed shop.” The other form of monopoly consists -in the exclusion of new members from the trade and in a control of -employment; this is a monopoly of a small group against their -fellow-workmen. It is enforced by regulating the entrance to the -trade, making it difficult or expensive, or by limiting the number of -apprentices. Sometimes, as in the Chicago Building Trades in 1900, -they have united with their employers by means of “exclusive -agreements” to raise wages and prices of the finished products at the -same time, and thus jointly to mulct the public. Such efforts to -monopolize the labor market have their counterparts in the -organization of capital, as we have seen. In practice such a labor -monopoly has sometimes been used to improve and elevate conditions, -just as sometimes a capitalistic monopoly has reduced prices below the -competitive point. In general, however, we must condemn monopoly on -principle in the competitive field and insist that freedom and -opportunity be given to all on as equal terms as possible. Of the two 72 -forms of trade union monopoly, the former alone, which endeavors to -make it all comprehensive and to enforce generally union conditions, -can be economically justified. - -“The establishment of a standard rate of wages may perhaps be said to -be the primary object of trade union policy. Without the standard rate -the trade union, such as it is, could have no existence.”[16] The -purpose of the union is to substitute collective bargaining for -individual agreements and thereby to improve the condition of its -members. But if a single bargain is to determine the pay of a large -number of men, there must be a common standard. In every employment on -a large scale the men are necessarily grouped together and their pay -is determined by a common rule. This is true even in non-union shops. -It is generally assumed that the standard rate of labor organizations -means a uniform wage for each member, but this is not the case; it -means rather a uniform rate of pay to all for the same performance. In -the case of piece work, it could manifestly not mean anything else; -but a large number of labor leaders object to piece work. They insist -that a standard wage means a minimum wage, and that by the -establishment of such a minimum the whole standard of efficiency and -the plane of competition are raised, as the employers cannot then -afford to hire any but competent workmen. The question immediately -presents itself as to what is to become of the older or partially -disabled men, who are no longer able to earn the standard or minimum -wage? In England they are practically guaranteed a subsistence by the -union; in this country the union not infrequently exempts them from -the provisions as to the standard wage. When the rule is enforced -there is certainly a real hardship for these men. But from the -employers there comes the more serious complaint that the effect of 73 -the standard wage is to reduce to a dead level the efficient and the -inefficient; that it is a maximum wage and that the efficient and -industrious are prevented from earning more than a fixed amount. There -is undoubtedly a great deal of truth in this charge; the man who -hastens the pace is said to be taking “blood money,” and sometimes a -maximum wage is set which the members are forbidden to exceed. On the -other hand, it may fairly be said that while the union regulation of -wages does tend to produce greater uniformity, the union rate is -usually higher than the competitive rate would be, that is, wages are -leveled up, not down; and finally, that territorial variations make -the local rate conform to local conditions. - -A reduction in the hours of labor has been even more strenuously urged -by progressive labor leaders in the United States than an increase in -wages. “Organize and control your trade and shorten your hours,” is -their contention, “and wages will take care of themselves.” Their -arguments in favor of a general shortening of the working day are -twofold. In the first place, owing to the intensity and strain of work -under modern machine methods, the worker cannot work efficiently more -than eight or nine hours a day. The work is too exacting and the -strain on the attention too great; it is a noticeable fact that most -of the accidents in industrial establishments occur in the last hour -or two of the working day. Not only that, but the laborer is entitled -to his share of industrial progress in the form of more leisure, -giving him time for a better family and social life, affording -opportunity for intellectual improvement, and permitting the -development of more rational and higher wants. With the improvement in -the condition of the laboring classes, will go the elevation of -society as a whole. - -The second argument in favor of shorter hours put forward by the trade -unionist, is economic rather than social. He argues that a “reduction 74 -of hours will diminish the supply of labor in the market, and so will -raise its price. It will make room for the unemployed, and so will -remove the depressing influence of their competition.” There is -involved in this contention the familiar lump-of-labor argument of the -trade unionist: there is just so much work to be done, and if some men -do each a little less there will be more for others. By shortening the -hours of labor of everybody employment will be made more general, and -the work will be better distributed. Now the economists in general -have supported the trade unions in their demands for a shorter working -day, but they have done so because they believed that the product of -industry would not thereby be diminished. They have seen that when the -hours of labor were reduced the laborer was less rapidly worn out -physically, that he could work more rapidly for a short time, and that -his increased leisure and pay, if rationally used, made him a more -intelligent and efficient worker. In other words, a reduction in the -hours of labor from 15 a day to 12, to 10, and even in some cases to -8, was not attended by a parallel reduction in the output, but the -latter remained about the same. This is the great economic -justification of the shorter working day, and as long as this can go -on without materially affecting the product of industry it must be -approved. If, however, the latter is decreased there will be less to -divide and then the relative disadvantages of a smaller dividend must -be weighed against the advantages of increased leisure. Of course the -point to which the number of hours can be reduced without lessening -the product can only be determined by experiment, and will differ in -different trades, but it is inevitable that until this point is -reached the pressure of the trade unions for shorter working days--or -for more holidays or half-holidays--will not be successfully resisted. - -Turning now from theory to fact, we find that there has been a great 75 -improvement in the condition of labor in this respect. At the -beginning of the nineteenth century the almost universal working day -was, as McMaster tells us, from sun to sun. As factories grew up the -habits of agricultural labor were carried over into industrial -occupations, and working days of 16 and 18 hours were not uncommon. In -1903 the average length of the working day in the United States was -9.6 hours. This great reform may fairly be credited to the efforts of -organized labor itself, for without their insistence and struggles it -is unlikely that it would have been voluntarily granted by employers. - -The limitation of output results almost necessarily from the -above-mentioned practices of the unions: reduction of hours, -prohibition of piece work, and the standardization of wages all tend -to restrict the output of the individual worker. But some of the -unions have gone further and have directly limited the amount that -could be produced during a given period by the laborer. This has been -particularly true of British unions and is the subject of common -complaint by English employers and writers, but illustrations may -easily be found in the United States. Thus in Chicago in 1900 “the -lathers limited a day’s work to twenty-five bundles of lath, for which -they received $3; they had formerly done thirty-five bundles for a -daily wage of $1.75. Plasterers were limited to thirty square yards a -day; the steam fitters were permitted to lay only ninety feet of steam -pipe per day; but the plumbers had the most objectionable rules and -restricted materially the amount of work that could be done in a -day.”[17] These rules were defended by the unions on the ground that -they were necessary in order to secure careful work and to prevent the -“rusher” for setting the pace for a fair day’s work. The practice 76 -has not been uncommon, especially in the sweated trades, for an -unscrupulous employer to pay a few particularly able workmen to put -extra speed into their work and so set a pace that the other workmen -would be compelled to maintain. This was especially objected to by the -unions in the case of team work. They claimed that when all the -workmen had come up to the new standard, particularly in piece work, -the wages were reduced so that even by working at the higher rate of -speed, they could only make a fair wage. One of the rules of the -Chicago carpenters’ union provided that “any member guilty of -excessive work or rushing on any job shall be reported and shall be -subject to a fine of $5.” Whatever the excuse it is clear that such -limitations cannot be economically justified. Not only does such -dawdling undermine the industrial efficiency of the worker, but it is -unfair to the employer. If the latter bargains for the union rate of -wages and the normal working day, he is entitled to a full return of -the laborer’s best efforts. Otherwise there is no fairness in -collective bargaining. “So far as labor leaders are concerned,” said -Mr. John Burns, the English trade unionist, “we are all strongly -opposed to the restriction of production; we are all in favor of -better and more conscientious work.” - -Laboring men have never been quite able to divest themselves of their -old antipathy to labor-saving machinery. They generally regard the -introduction of a new machine as a displacer of men, a creator of -unemployment, a depresser of wages. Some unions have successfully -resisted the introduction of machinery into their trades, as the stone -cutters in Chicago,[18] but in general they have recognized the -impossibility of this attitude. In general they now demand that when -machinery is introduced it shall be operated by union men and their -wages shall be fixed so as to give the workers a share of the 77 -increased production. - -The policies and methods of the trade unions thus far discussed are -those of a militant nature, but the fraternal objects of these -associations, though less conspicuous, are none the less important. -Labor organizations generally; have insurance and benefit features, by -which sick, injured, or unemployed members are assisted. This is -particularly true of the English organizations, which developed these -features before the rise of the militant new unionism. They often -possess large funds and have been rendered thereby more conservative -and responsible. The educative effect of trade unionism among the -members is marked; some of them possess libraries and all of them -promote discussion and thought upon economic problems, while the -administration of their affairs often gives valuable training. The -older unions did much to encourage co-operation among their members, -but today the tendency is to limit their activities to the essential -one for which they are organized, namely, collective bargaining. - -Intelligent unionists realize that they can secure the various objects -for which they strive only by substituting collective bargaining for -contracts between employers and individual laborers. Where this plan -is accepted by employers, representatives of the two sides agree upon -wage scales, usually for a year; during this period the chief task of -union officials is to see that the agreement is lived up to, and if -possible to add to their membership and strengthen the union. In the -United States relatively few trades have adopted this method as a -general practice, the employers still being able to dictate wages and -conditions of employment in most of them, while the unions are still -struggling for recognition, if not for existence. Employers insist, in -refusing to make collective bargains with the unions, that, as they -run all the risks, they must be permitted to manage their business as -they see fit and without interference from the business agent of the 78 -union. In reply the unions insist that hours, wages, and conditions of -employment are as much their business as that of the employer. The -latter also urges that the trade unions as at present organized are -too irresponsible and before they ask for collective bargaining should -be incorporated, so that they could be sued for breach of contract if -guilty of such. As yet, however, the unions have preferred their -present position of irresponsibility and immunity and have almost -invariably refused to be incorporated. - -“In the minds of a large section of the public,” writes President -Hadley,[19] “labor unions are chiefly associated with strikes. It is -believed by many who ought to know better, that such organizations -exist for the purpose of striking, and that if the organizations were -suppressed, industrial peace would be secured. The first of these -ideas is a distorted one; the second is wholly unfounded.” Strikes -are, however, a necessary concomitant of collective bargaining. If the -representatives of a union cannot come to terms with an employer, they -may compel their members to refuse to sell their commodity, labor; -such a concerted refusal to work is a strike. The “right to quit work” -has been regarded as a sacred one by trade unionists, but it involves -social consequences of great importance. For the workingman, it means -loss of wages and demoralizing idleness; to the employer, idle -capital, loss of profits, and depreciation of plant; and to the -consuming public, inconvenience and annoyance together with curtailed -production. Quite aside from all acts of violence and lawlessness, by -which they are too often accompanied, there is involved an enormous -money waste. According to a report of the Department of Labor, losses -from strikes and lockouts in the United States from 1881 to 1900 -amounted to $449,342,000 or an average loss per establishment involved -of about $3,500. - -The public is awakening to the realization that it suffers the 79 -greatest injury as the innocent third party to every industrial -dispute, and is insisting that the industrial peace be kept or more -reasonable methods of settling differences be found than a strike or -lockout. Such a method is found in conciliation and arbitration. In -the older and more strongly organized unions strikes are infrequent -and methods of joint discussion and agreement are increasingly -resorted to. Boards of conciliation are often provided for, which -endeavor by means of conference and concession to prevent a dispute -from arising; they succeed best where both employers and employes are -organized. Should the dispute come to a head, however, provision is -usually made for its reference to a board of arbitration, which may be -selected by the disputants themselves or may be created by the state; -in the latter case the acceptance of the award may be voluntary or -compulsory. In the United States most of the successful boards have -been those selected by the parties to the dispute; the state boards -have usually the power only of investigating the causes of the -trouble, but this in itself has proved of considerable value in more -than one instance, notably in the case of the Anthracite Coal -Commission. Compulsory arbitration is being given a thorough trial in -Australasia and seems to be meeting with success there. In this -country, however, the trade unions are strongly opposed to compulsory -or enforced governmental arbitration. Writing of Great Britain, Mr. -and Mrs. Webb assert that the principle of arbitration, having been -found inconsistent with collective bargaining, is fast going out of -favor. It would seem from the experience of both England and the -United States that the chief virtue in these methods lies in the habit -of joint conference and conciliation between the representatives of -labor and capital. - - - - -IX. WOMEN AND CHILDREN AT WORK. 80 - - -While women and children have always assisted in the work of the home, -it was not until the development of the factory system that they began -to work for wages outside of the family. From the earliest days the -preparation of food, spinning and weaving and making up of garments, -and other branches of domestic economy had been the peculiar tasks of -the housewife. With the removal of the textile industries from the -home to the factory and the invention of light-running machinery, many -women followed them and employment was found also for young children. -Thus with the inception of the modern factory system and machine -production there arose the problem of woman and child labor. In -England the evils of the early factory system were incredibly bad. -“The beginning of the present century,” wrote President Walker,[20] -“found children of five, and even of three years of age, in England, -working in factories and brickyards; women working underground in -mines, harnessed with mules to carts, drawing heavy loads; found the -hours of labor whatever the avarice of individual mill owners might -exact, were it thirteen, or fourteen, or fifteen; found no guards -about machinery to protect life and limb; found the air of the factory -fouler than language can describe, even could human ears bear to hear -the story.” Conditions were never so bad in this country as in England -owing to the later development of the system and prompter legislation -against its evils, and especially to the scarcity of labor which -compelled employers to make the conditions of labor more attractive. - -The field of employment for women has been a constantly expanding one. -When Miss Harriet Martineau visited the United States in 1840 she -found only seven occupations open to women, namely, teaching, -needle-work, keeping boarders, work in the cotton mills, type-setting, 81 -book-binding, and domestic service. Since that time the area has -widened until there is scarcely an occupation in which women are not -found except those closed to her by law or by physical inability. The -number of females 10 years of age and over engaged in gainful -occupations was 2,647,000 in 1880 or 14.7 per cent of the total female -population; this number more than doubled in the next twenty years, -being 5,319,000 in 1900 or 18.8 per cent of all. The largest number -employed was in domestic and personal service, and next to that in -manufacturing and mechanical pursuits, though even in that branch they -were most numerous in the traditional branches of woman’s work, as -dressmakers, seamstresses, etc. It is nevertheless in the -manufacturing industries that the most serious evils connected with -woman and child labor are found. The problems differ greatly in -different sections of the United States: in the Atlantic states the -greatest proportion of women as compared with men find employment and -give rise to special problems of women’s work; in the South child -labor is more conspicuous; while in the West both woman and child -labor are of relatively small importance. - -An interesting question suggests itself at this point: Is the increase -in the employment of women at the expense of men? Are the women -crowding the men out of their occupations and taking their places? At -first inspection the statistics of occupations would seem to lead to -an affirmative answer, for the percentage of women breadwinners -increased from 13.5 per cent of all such in 1880 to 16.6 per cent in -1900, while that of the men fell from 80 to 77.3 per cent, and that of -the children remained about the same. The cause of the change in the -proportion of the sexes was not due, however, to any falling off in -the number of men, but to the great influx of women into the ranks of -wage-workers. In some lines of employment, like those of bookkeepers, -stenographers, typewriters, clerks, etc., there has undoubtedly been 82 -an encroachment and men have been displaced. But on the other hand, -many occupations have been opened to men during the last fifty years -that were unknown before. Such have been the expanding fields of -railroad construction and operation, the steel industry, the -utilization of electricity, and other similar lines. In most of these -the muscular effort involved or the character of the work have kept -women out, but in other lines where special rapidity or lightness of -touch are required the women outnumber the men, as in the manufacture -of cotton goods, hosiery, hats and caps, etc. The development and -improvement of machinery has of course favored the employment of -women. Mr. John A. Hobson[21] asserts that “in modern machinery a -larger and larger amount of inventive skill is engaged in adjusting -machine-tending to the physical and mental capacity of women and -children.” He concludes that if the exploitation of these forms of -cheap labor had not been prevented by factory legislation and by -public disapproval, “the great mass of the textile factories of this -country [England] would have been almost entirely worked by women and -children.” As a matter of fact one of the reasons for the great -expansion of woman labor in the United States as well as England is -because it has been found cheaper than man’s labor. We are thus -brought face to face with a fundamental question in the discussion of -the problem--why are women paid lower wages than men? - -As to the fact there is no doubt; one comparison taken from the Census -of 1900 will be sufficient to illustrate it: the annual average -earnings of men in mechanical and manufacturing industries were $490, -and of women $272 per annum. The more important question is why this -difference exists. A number of reasons suggest themselves at once. In -the first place women are less efficient than men and produce less; 83 -hence they are paid less. In some industries, particularly those -requiring physical strength, women cannot compete successfully, and -those are usually the highest paid employments. Other well-paid -industries are regarded by men as essentially their own and social -pressure is applied to keep women out. Then, too, woman’s ambition to -attain industrial efficiency is not so great, owing to her expectation -of marriage and release from industrial life. Women are more often -absent from work owing to sickness and domestic claims upon their -time; this irregularity of employment tends to reduce their -efficiency. But even in employments where the efficiency of men and -women are admittedly equal the women receive lower wages in the -majority of cases. According to a report of the Bureau of Labor, out -of 100 cases where the women did the same work as the men and did it -as well, they received lower wages than the men in 80. This leads to -the consideration of a second group of causes, which have to do with -woman’s standard of living. One reason why she receives less is -because she is able and willing to live on less. Physiologically, Dr. -Atwater has said, man needs one-fifth more nutriment than woman. -Women’s wages are less because of their somewhat lower cost of -subsistence. But even aside from this fact, the frequent partial -dependence of women upon other members of their family for support -makes them willing to accept less and consequently reduces their -wages. The average American workingwoman is young, only about -twenty-two and a half years old, and after the age of twenty-five is -reached the number declines rapidly. That is to say, working girls -regard their employment as a temporary affair, remaining only about -five years on the average in the store or factory; during this time -they often live at home with their parents and are content to receive -a wage much smaller than a man would require as head of a household. - -The third reason is, however, the most important, because it explains 84 -at the same time the low economic position which woman occupies in the -industrial world. The narrowing of the field within which women can -readily find employment has the effect of greatly intensifying the -competition within that field. There is also a great reserve army of -potential women wage-earners, whom a slight increase of wages or force -of circumstances--loss of employment by the male members of the -family--will bring into the field as competitors. There is, in other -words, a constant over-supply of labor in most women’s industries, -which does not exist in any men’s industries except the most -unskilled. Women exhibit, furthermore, a comparative lack of mobility -from one industry to another, as well as from one locality to another. -According to Professor Smart, women are so unready to leave home that -their pay on one side of narrow Scotland is 50 per cent lower than on -the other side. In the same way, the flow of labor from one occupation -to another, which tends to equalize the advantages and rates of pay of -different employments, is far feebler among women than among men. -Finally, there is little organization among women. Their -individualistic, almost jealous, attitude to one another prevents -their combination and united action, while their submissive acceptance -of what is offered leads to apathy. They have only infrequently formed -unions and endeavored to substitute collective bargaining for -individual action. Women are therefore industrially in much the same -situation as unskilled, unorganized male laborers, and the remedy in -both cases would seem to be the same--education and organization. - -The presence of a large supply of cheap woman labor undoubtedly has a -depressing effect upon men’s wages, and consequently upon the standard -of life of the whole laboring class. George Gunton[22] is authority -for the statement that “in proportion as the wife and children -contribute to the support of the family the wages of the father are 85 -reduced.” The family wage tends to remain the same whether it is -earned by the father alone, or by the father with the assistance of -his wife and children. It is, however, not quite clear in most cases -whether the men’s wages are low because the women and children work, -or whether the women and children work because the men’s wages are -low. It may fairly be concluded, however, that the evil effects of low -wages for women are not confined to themselves but are felt by all -with whom they come in competition. - -What conclusion shall we draw then, in view of all these facts, as to -the desirability of employment of women? The fact of their low wages -and industrial dependence is not sufficient to lead one to condemn it. -These are transitional phenomena and can be remedied. Women have -always worked--on the farm, in the home, in making household supplies. -When this work was taken over by the factory woman became a -wage-worker in the modern sense. “The census records in respect to the -labor of women, therefore, read in the light of collateral facts, are -a history of industrial readjustment rather than a record of the -relative extent of the employment of women, and it is impossible to -say, so far as the census figures are concerned, whether a larger -proportion of women are actively engaged in labor today than formerly -or not. The one fact which is clear is that factory or shop work is -displacing home work, and that this readjustment of industrial -conditions is leading to the employment of women outside the home in -constantly increasing numbers.”[23] The effect of this readjustment -has been to increase greatly the production of wealth. The production -of household supplies was removed from the family to the factory when -it was handed over to machinery and done better and more cheaply. If -the work of women thus released were expended for no useful purpose -society would gain only in the increased leisure of the women. But if 86 -these then took up other new lines or set men free from old -employments so that they could turn to still different ones, then the -production of goods could be greatly increased. “Without women’s -help,” says Mr. George L. Bolen,[24] “their work in stores and offices -would be done by men taken from other employment. The latter’s present -work would have to be stopped to that extent, lessening the quantity -of goods produced by men. The effect would be the same as if a farmer -had to stop plowing two hours before noon to go to the house and cook -his dinner…. Women behind the counter, and at the typewriter, -release men for work that women cannot do.” From the standpoint of -woman herself, industrial independence must be regarded as a great -gain. Set free from the necessity of contracting marriage for the sake -of a home, and of depending upon mere sex attraction to attain that -end, she will develop her capacities more fully and when she does -enter upon marriage will do so as a result of mutual attraction. The -entrance of women into gainful occupations must be regarded as an -essential step in their own progress and the improvement of society. - -Quite different must be our attitude towards child labor, which can -only be condemned as a waste of labor power and as stunting the -development of the children. The Census of 1870 stated for the first -time the number of children at work in the United States; there were -739,164 between the ages of 10 and 15 years, of whom 114,628 were -employed in manufactures. During the next decade the number increased -over 58 per cent to 1,118,356 children at work in all occupations. The -disclosure of such an undesirable tendency called forth restrictive -legislation in most of the states and the number declined materially -by 1890. Since 1890 however there has been a reversal of this tendency -back to the conditions of 1880, owing chiefly to the industrial 87 -development of the South, where almost no factory legislation exists -as yet. In 1904 there were 1,752,187 children at work between the ages -of 10 and 15 years, or almost one-fifth of all the children of those -ages. The evils connected with child labor are the long hours--usually -11 or 12 hours a day where no restrictive legislation exists--and the -exhausting and often dangerous work. The effect on the health of the -children of monotonous and exhausting toil before their muscles are -set and their frames knit up is thoroughly bad; they are stunted and -deformed and prematurely aged. Many of the occupations, too, in which -child laborers are most numerous, are dangerous or injurious, as tin -can factories, saw mills, paper box factories, type foundries, and -tobacco establishments. Second only to the physical effects of child -labor is the mental and moral injury suffered not merely by the child -but also by society in depriving these youthful laborers of a thorough -education. While it is well that children should be kept busy, there -is no compensating reward either in money wage or preparation for -adult life in such monotonous, profitless drudgery. The influence of -the competition of children upon wages is leveling, and their -employment indicates either a willingness on the part of employers and -parents to exploit this cheap and defenseless form of labor, or a -backward state of civilization. Such an evil can be cured only by -determined public opposition, by the passage of laws forbidding all -labor by children under a certain age, say 15 (except possibly in -agricultural or housework), compelling school attendance, and -providing for careful inspection. Most of all is needed an aroused -public conscience. - -Labor legislation is the most effective method of improving the -conditions of employment, and to a consideration of this subject we -must devote the remainder of this section. We have already seen that -the fundamental principle of our modern wage system is freedom of -contract. This is guaranteed in our federal and state constitutions 88 -as both a personal and a property right. As a result of this fact the -courts have generally declared unconstitutional any legislation, -designed to protect the interests of labor, that seemed to abrogate -this freedom of contract or that savored of class legislation. Efforts -to improve the condition of labor by legislation have therefore met -with especial obstacles in this country. On the whole, however, means -have been discovered of evading these constitutional restrictions when -it has seemed clearly demanded by the welfare of society, and the -history of labor legislation in this country is one of fairly steady -progress. The early laws were practically confined to imprisonment for -debt, mechanics’ liens, the hours of education of children employed in -factories, and similar matters. Nothing noteworthy was accomplished -until 1866 when Massachusetts passed an eight-hour child labor law for -children under fourteen; in 1874 she passed a ten-hour law for women -and children under eighteen, engaged in manufacturing establishments, -and in 1877 enacted the first factory inspection act, which has since -been copied in about twenty-four states, and without which mere -legislation is of little avail. - -The factory acts may be divided into two classes, those that endeavor -to secure the safe or healthful manner of conducting a business, and -those that attempt to limit the occupations, the hours, and the -methods of payment of the workers. Under the first head come such -matters as fire protection, ventilation, guarding of machinery, -inspection of boilers and mines, etc. Such legislation and inspection -have in many states been extended to churches, schoolhouses, hotels, -theaters and public buildings. The second group includes those laws -which are usually meant when factory acts are referred to. In England -there has been a very steady development and extension of such -legislation, beginning in 1802, when Peel’s Act tried to protect the -health and morals of the pauper apprentices in the cotton mills; this 89 -was extended to all young people in textile industries in 1833, to -women in 1844, then to all large industries in 1864, and to smaller -ones in 1867, and finally in 1878 these various provisions were -codified into a complete factory act, regulating the health and safety -of the laboring people generally. In the United States the movement -was considerably later and has not been so uninterrupted. But today -laws limiting the number of hours of labor to eight have been passed -by the Federal Government and fifteen of the states for all those -engaged on public works. Attempts to fix the hours of labor of adult -male workers have usually been declared unconstitutional, for the -reasons stated above, except in especially dangerous or unhealthful -occupations, as bakeries, mines, smelters and similar lines. -Consequently the men have been forced to rely largely upon their own -efforts for the redress of industrial grievances; in this fact lies -one explanation of the growth and strength of labor organizations in -this country. On the other hand, legislation in behalf of women and -especially children--wards of the state--has usually been held -constitutional by the courts, and has had a more extended application. -About twenty of the states have regulated the length of the working -day for women and children. Special child labor laws limit the age -below which employment is illegal, usually between ten and fourteen -years of age; and provide for a minimum of education before a child -can be employed. About half the states provide for factory inspection -to see that the provisions of the various acts are lived up to. In -general we may conclude that by the passage of such legislation -society has definitely decided that there are some conditions of -employment that cannot be safely left to free contract or to -collective bargaining between employer and employe, but that they must -be regulated by society itself on the broad grounds of social welfare. - - - - -X. UNEMPLOYMENT AND INSURANCE. 90 - - -The greatest problem in modern industry as well as the -greatest curse to the laboring classes, is unemployment. While -unemployment has always existed under all systems of labor, it assumed -added significance when the introduction of the wage system threw -every worker upon his own resources and made him responsible for the -care of himself and his family. Modern industry is sensitive and -unstable and its delicate mechanism, very likely to get out of order; -credit and fashion, to mention no others, are factors that make for -instability, and these are essentially modern. Professor Marshall is -of the opinion that the factory system has not increased inconstancy -of employment, but has simply rendered it plainer by localizing it. -But whether more or fewer than in earlier times, the number of the -unemployed in modern industry is appallingly great. It is not easy to -estimate correctly the extent and amount of this evil and we -accordingly find considerable variations in the statistical -presentations of fact. In 1885 two investigations of the amount of -employment were made, one by Carroll D. Wright, in his report as -United States Commissioner of Labor for 1886, and the other by the -Massachusetts Bureau of Labor in its report for 1887. Mr. Wright -defines the unemployed very narrowly as “those who under prosperous -times would be fully employed, and who, during the time mentioned, -were seeking employment”; using the term in this restricted sense he -concluded that 7½ per cent of the working population engaged in -manufacturing and mechanical pursuits, and trade and transportation -were idle during the year, which moreover he considered one of extreme -depression. The Massachusetts statistics, on the other hand, were -presented as indicative of general conditions in normal years and may -safely be regarded as such. According to this report, 30 per cent of -the total number of breadwinners in the state had been unemployed at 91 -their principal occupations on an average of 4.11 months in the year -covered; some of these found work at other or secondary occupations. -But the net result of the investigation was well put in the terse -statement of the report, that “about one-third of the total persons -engaged in remunerative labor were unemployed at their principal -occupation for about one-third of the working time.” At the lowest -estimate the whole working population lost on the average almost -one-tenth of their working time. The loss of such a proportion of the -community’s productive force, with all the demoralization attendant -upon irregular or no labor, is evidence of a problem of grave import. - -Unemployment is such a broad term and covers so many different ideas -that it will be well to classify the unemployed before proceeding -further. They may be logically divided into the following classes: I. -The temporarily unemployed, who comprise (a) those certain of work -again, as efficient workmen who are temporarily out of work owing to -seasonal variations, shut downs, etc.; (b) those without such -prospect, a group which again divides into two groups, namely, (1) -efficient and industrious workmen who have been thrown out of work by -a change in fashion, the introduction of new machinery, foreign -competition, a prolonged depression, etc., and (2) those whose work is -essentially fluctuating and casual in its nature, as casual day -laborers, charwomen, etc. II. The permanently unemployed, consisting -in turn of (a) the “won’t-works,” as tramps, and (b) the -“can’t-works,” or the defective and dependent classes generally. Such -a classification renders much easier the analysis both of the causes -and of the cure of unemployment. - -The first question that presents itself in any discussion of the -causes of unemployment is whether it is due primarily to personal -causes, as inefficiency or intemperance, or to industrial causes over -which the individual has no control. “Personal causes are those 92 -mental, moral, and physical defects which show themselves either in -the inability and inefficiency of the workman or in his unwillingness -to work. Here are included all the varieties of personal inaptitude, -ranging from idiocy, intemperance, and vice to old age, sickness, and -accident.”[25] Such a comprehensive definition includes many cases, of -course, where no blame can be attached to the individual, and yet each -one of these causes is personal, that is, it does not affect at the -same time a whole group, as an industrial depression would do. Persons -included in this group are always on the margin of employment; in bad -times the first to be discharged, in good times they are the last to -be employed. Nor is the cause of their lack of employment always easy -to give; it may be itself the result of industrial accident or -unhealthful occupation, or the result of heredity, evil habits and -associations, and defective education. We may present two tables -giving briefly the causes of poverty and unemployment. The first gives -the causes of poverty ascribed by the charity organization societies -of New York, Boston, and Baltimore to applicants for relief: - - Causes of poverty: charity organization society records.[A] - - =================================+=================== - Cause. | Per cent. - ---------------------------------+---------+--------- - Drink | 13.7 | - Shiftlessness and inefficiency | 7.5 | - Other moral defects | 2.1 | - Total, Character | | 23.3 - ---------------------------------+---------+--------- - No male support | 5.0 | - Lack of other normal support | 3.6 | - Total, Support | | 8.6 - ---------------------------------+---------+-------- - Lack of employment | 23.5 | - Insufficient employment | 8.1 | - Poorly paid, etc. | 3.3 | - Total, Employment | | 34.9 - ---------------------------------+---------+-------- - Sickness and death in family | 21.1 | 93 - Insanity and physical defects | 4.1 | - Old Age | 3.9 | - Other incapacity | 3.2 | - Total, Incapacity | | 32.3 - ---------------------------------+---------+-------- - | 100. | 100. - ---------------------------------+---------+-------- - - [A] Warner, American Charities, Rev. Ed., 53. - -The first group of causes indicates misconduct, as the last group -indicates misfortune; the other two shade off into industrial causes, -though lack of employment--the largest single cause--may in turn be -ascribed to any one of several remoter causes according to the bias of -the investigator. This table is a record of the causes of failure on -the part of those who have fallen behind or dropped out altogether in -the race of life. At the other end of the scale stand the members of -labor organization, on the whole, the elite of the labor world. The -following table gives the causes of unemployment of 31,339 cases at -the end of September, 1900, as reported to the New York Bureau of -Labor Statistics: - - Causes of idleness, members of trade unions, 1900. - - ---------------------+----------- - Cause | Per Cent - ---------------------+----------- - No work | 75.5 - Bad weather | .5 - Strike or lockout | 13.0 - Sickness | 4.7 - Superannuation | 1.6 - Other causes | 4.7 - | - Total | 100.0 - ---------------------+---------- - -This table emphasizes very strongly the industrial causes of -unemployment, three-fourths of which is ascribed to lack of work. In -some cases, as the iron and steel workers, where there is a regular 94 -two months’ shut-down to make repairs, and the building trades where -the inclemency of the weather usually prevents work during the winter, -the lack of employment may be regarded as a vacation rather than a -hardship, for the rates of pay are high enough during the remaining -months to offset those of idleness. In other cases, however, as in -coal-mining, there is a large reserve army of workers on hand and -employment is secured for only one-half to two-thirds the time. In -1900, when the average number of days of employment was larger than it -had been in ten years, the bituminous miners were employed only 234 -days and the anthracite miners only 166 days in the year. This -indicates a very bad organization of the industry. The same thing was -formerly true of the London dockyards, where there was a reserve army -of some 4,000 surplus workers. Of course the effect of this is to -depress wages. The clothing trade is subject to seasonal fluctuations -and the caprice of fashion, and offers very irregular employment. -Machinery and improved processes were frequently spoken of by -witnesses before the Industrial Commission as the leading cause of -unemployment. If the general conditions of business are good at the -time of the first introduction of machinery the displaced laborer is -reabsorbed again and the hardship is not so noticeable. But if it -coincides with a period of business depression the introduction of -machinery appears to be the cause of a large displacement of labor, -which might more truly be ascribed to industrial depression. This last -cause is responsible for enormous suffering among the laboring -classes, for the method oftenest resorted to by industrial enterprises -to reduce expenses is the wholesale discharge of laborers, who are -thus made to bear the burden of industrial disorganization. This was -well illustrated by the economies effected by the railroads in the -year 1908, in their general reduction of the labor force and of wages. -But even in good years the inconstancy of employment is startling. In 95 -the four years 1897-1900 the men in trade unions in New York State -lost 16.2 per cent of their time from unemployment, which is almost -exactly one day in every week. And these, it must be remembered, were -skilled and efficient workers in organized trades. Finally, strikes -are given as a cause of unemployment in the table; these are a -peculiar feature of modern industry, and do not call for further -discussion, except to point out that they are not as important as -often represented. - -The foregoing analysis of the causes of unemployment shows that they -are deep-seated in the nature of modern industry, and that it would be -unjust to the workingman to attribute them in any large measure to his -incapacity or indisposition to labor. The care of the unemployable -must of course be undertaken by society, and such persons prevented as -far as possible from depressing the wages of competent labor by their -competition. Exceptional periods of distress may and should be met by -temporary relief measures. But what we may call the normal -unemployment in modern industry, which amounts to 2-2½ per cent of -the labor force, cannot be overcome by direct methods. The remedy for -this lies “in a better organization of employers and employes, more -steady expansion of trade, and greater stability of industry and of -legislation affecting industry. These are not problems directly of -unemployment, but rather of taxation, currency, monopoly, immigration, -over-production, and technical advances in industry. Their treatment -must be undertaken, not primarily as measures of providing for the -unemployed, but as measures for improving the conditions of -business.”[26] The problem of unemployment would thus seem to be a -permanent one, bound up in the very nature of a dynamic society; it -may be regarded as the price of progress. But the question may fairly -be raised as to whether the laboring classes should foot the bill, 96 -or whether the cost might not fairly be borne by society as a whole. -This has suggested, as a solution of the problem, insurance of -workingmen against unemployment, a discussion of which, however, must -be deferred to the end of the section. Some methods of alleviation, if -not of abolition, of the evils of unemployment may be suggested. Free -public employment bureaus and agencies, national in scope and well -integrated, would do much to secure a better adjustment of demand and -supply in the labor market, and secure a better distribution of the -labor force and greater mobility of labor. Better organization and -mutual understanding on the part of both employers and employes is -needed, to prevent the loss through strikes and lockouts. And finally, -improved industrial and technical education is essential, whereby the -loss in skill through the introduction of new inventions and machinery -may be minimized, and the productivity of the laboring class be -increased. - -Among the measures of relief for unemployment due to accident, -sickness, and old age, none is more important or more deserving of a -hearing in the United States than that of insurance against these -evils. The earnings of the average male wage-earner are so small--half -of the number earn annually less than $436, and half of the adult male -factory workers earn less than $400 a year--that the unemployment, -sickness, disablement, or old age of the breadwinner must throw a -large proportion of families so afflicted into a condition of periodic -poverty. Any remedies that will alleviate the miseries caused by -fluctuations in employment, industrial accidents, diseases incident to -industry, etc., deserve a respectful hearing. - -No adequate statistics of industrial accidents exist in the United -States, but a recent estimate by F. L. Hoffman[27] gave the number of -fatal accidents among occupied males in 1908 as between 30,000 and -35,000. An analysis of the reports of the New York Bureau of Labor 97 -Statistics from 1901 to 1906, shows that of the total number (39,244) -of industrial accidents reported in that state a little over 2 per -cent were fatal, almost 17 per cent resulted in permanent disablement, -and 81 per cent resulted in temporary disablement. More than half of -the accidents in industry are the result of machinery in motion. Mr. -Hoffman calculates that “it should not be impossible to save at least -one-third or perhaps one-half by intelligent and rational methods of -factory inspection, legislation, and control.” Prevention of accidents -rather than compensation to the workingman after they occur should be -the aim of society, in order to avoid the wasteful loss of productive -power, not to mention the suffering and misery entailed by such -accidents. “Immunity, not compensation,” has been the demand of the -British trade unions. Of first importance then is careful factory -legislation, safeguarding of machinery, and factory inspection. But -here we are interested primarily in the question of responsibility and -compensation. In the United States, legislatures and the courts have -taken the position that the workingman was responsible unless he could -prove the employer responsible for his injury. How impossible such -proof is and consequently how intenable such a position, is clear from -the following table, compiled by the German Government for purposes of -accident insurance: - - Accidents in German industries traceable to different causes. - - ==============================+=============+==========+======== - Causes. | Agriculture | Industry | Mining - | (1891) | (1887) | (1887) - ------------------------------+-------------+----------+-------- - Fault of employer | 18.2 | 19.8 | 1.3 - Fault of injured workman | 24.4 | 25.0 | 29.8 - Fault of both | 20.1 | 4.4 | - Fault of third person | 2.8 | 3.3 | 4.3 - Unavoidable or indeterminable | 34.5 | 46.9 | 64.6 - +-------------+----------+-------- - Total | 100.0 | 100.0 | 100.0 - ------------------------------+-------------+----------+-------- - -Statistics from both Germany and Austria show that a full half or 98 -more of all industrial accidents are due to causes for which neither -employers, injured workmen, nor fellow employes are responsible, but -which are incidental to the nature of the industry itself. But besides -the danger of injury from machinery, there are numerous specially -dangerous or injurious trades, in which injury by poisoning, disease, -etc., is almost unavoidable as trade processes are at present -conducted. These have been classified as follows: trades in which lead -is a poisonous element, trades which produce other chemical poisons, -trades in which lockjaw is an incident, trades in which the danger -arises from injurious particles in the air, or from dust, processes -that require a sudden change from heat to cold and vice versa, and -those that require artificial humidity, and trades in which accidents -are so frequent as to demand special legislation. Before we try to -decide who in justice should bear the cost of sickness or injury -arising from these causes, let us inquire as to the practice in the -United States and in other countries, so as to have the data necessary -for a fair conclusion. - -The original legal doctrine regarding liability for accident in -England and America, which is still practically unmodified in the -latter country, was based on the principle of individual -responsibility for acts of negligence. Briefly stated the common law -doctrine is that an employer must provide reasonably safe conditions -of employment, and that then the employe assumes the risks incident to -the occupation, or arising from the carelessness of fellow-servants; -moreover, even if the employer has been remiss, the employe cannot -collect damages if he has been guilty of contributory negligence. -These three doctrines--assumption of risk, doctrine of the -fellow-servant, and contributory negligence--have been used -practically to free the employer from all responsibility in cases -where injured employes have sought to secure damages. Moreover, as -has been shown above, many cases exist where it is impossible to fix 99 -the blame on either employer, employe, or a third party, and in such -cases no compensation could be secured for injury under the law. The -full rigor of the common law, which has worked out so unfairly for the -workingman in modern machine production, has been modified in about -twenty-seven states by statutes defining more exactly the duties of -the employer, and repealing the fellow-servant doctrine in regard to -railway employes and in a few states in regard to all mechanical -industries. With these exceptions, however, the law of employers’ -liability has not been changed, and compensation for industrial -accidents must be sought by injured employes through a suit for -damages against the employer. In 1906 and again in 1908 Congress -passed a federal employers’ liability act, limited to common carriers, -which, however, represents only development along the lines of -negligence law. That is, we are still proceeding upon the assumption -that in every accident which occurs somebody is to blame. We shall -have to look to foreign countries for a practical application of the -principle that the cost of accidents in modern industry should be made -a charge upon the industry itself, and ultimately be incorporated in -the higher price of the article produced. - -Germany was the first country to introduce the principle of compulsory -accident insurance in 1884. Employers are there organized into -associations and sections and are compelled to bear the expense of -granting to injured workingmen compensation, which amounts to about -two-thirds their average wages. England in 1897, by the passage of the -Workmen’s Compensation Act, adopted the principle “that a workman is -entitled for all accidents of occupation to a moderate and reasonable -compensation.” Twenty-three countries, or practically all the advanced -industrial nations of the world except the United States, have passed -laws to compensate sufferers for all accidents of industry, thus 100 -placing the burden of industrial accidents upon the industry as such -and not upon the laborer. - -As we have seen, sickness and old age are still more usual causes of -poverty and unemployment than accident. All the arguments for -compulsory insurance therefore apply with redoubled force to these -evils. Germany was again the pioneer in the establishment of these -forms of insurance. In 1883 sickness insurance was organized, being -made compulsory for all persons with incomes under $500; the expense -is borne one-third by the workers and two-thirds by employers, the -main purpose being to secure a sufficient relief--amounting to -one-half the wage--for a period of thirteen weeks. In 1889 invalidity -and old-age insurance was introduced for the same class; contributions -are made in equal proportion by employe and employer, the state -contributing about $12 a year to each annuity. Pensions are granted -after thirty years of payment or to those over seventy. In 1908 Great -Britain passed a still more comprehensive measure, providing for -pensioning all citizens of seventy years or over, who have been -residents for twenty years, in accordance with a sliding scale based -upon private income, the pensions ranging from five shillings weekly -down to one shilling. The pensions were expected to cost $35,000,000 -the first year, but will probably entail double that amount. Finally, -insurance against unemployment was tried in Switzerland in 1893 to -1897, but was finally abolished, owing to abuses and difficulty of -administration. - -There are probably no more important practical economic problems than -those connected with unemployment and workingmen’s insurance. Slowly -the conviction has spread that under present conditions of industry -workingmen cannot fairly be held responsible for industrial accidents, -and that with prevailing wages they cannot be expected to save enough -to maintain themselves in sickness and old age. It therefore becomes -the duty of society so to organize industry and legislation that the 101 -terrors of accidents, sickness, and old age, shall be reduced to a -minimum. - - - - -XI. MACHINERY AND INDUSTRIAL EFFICIENCY. - - -So far in the discussion of modern capitalistic production and of the -various labor problems to which it has given rise we have not treated -in detail the question of machinery and its effects on labor. We -cannot, however, leave this subject without taking up this phase of it -with considerable care. The advantages of machinery have been more -often emphasized than the evils, so that we may profitably begin with -the darker side of the picture. President Hadley[28] enumerates three -evils which are charged against machinery, as now managed and -operated: “1. That it displaces a large amount of human labor, thus -taking income away from employes and giving it to employers. 2. That -when it does not actually drive human labor out of use, it employs it -in circumstances unfavorable to efficiency, health, and morals. 3. -That under the best conditions it deprives the workman of -independence, making him a specialized machine instead of a -broad-minded man.” We cannot do better than take up these points one -by one. - -In answer to the first charge President Hadley flatly denies that -machinery has displaced labor, but insists that “there has been a most -conspicuous increase of employment in those lines where improvements -in machinery have been greatest,” giving the expansion of railroads as -an illustration. But it is not possible to generalize from this case -without further analysis. The immediate effect of improved machinery, -especially if suddenly introduced, is practically always to throw men -out of employment. The extent to which this will occur depends on the -suddenness and extensiveness of the change, but fortunately, as -Professor Nicholson points out, new inventions seldom come suddenly or -are introduced all at once on an extensive scale. It took almost a -generation, for example, for American machine methods to displace 102 -Swiss hand labor in the making of watches. But when such a change does -occur it hits hardest the least efficient and older men, those just on -the margin of employment, for a man past middle life can rarely learn -a new trade. The effect of displacement in causing suffering will also -depend somewhat upon the mobility of labor, both the knowledge of new -opportunities and the capital to make possible a change of location or -industry, and improvements in the means of transportation. It can -easily be shown that as a general principle the lump-of-labor theory -is erroneous, namely, that there is just so much work to be done and -that if machinery is introduced there will be less work for men to do. -But there is this element of truth in it, that the question whether -men will be reabsorbed in the same industry depends upon the fact as -to whether the market for the goods produced by the new machine can be -expanded. If the demand is elastic, that is, can be largely extended -because of the fall in price brought about by the cheaper production, -as in the case of cotton goods, then the displaced laborers will -probably be re-employed to produce an enlarged supply. If, however, -the demand is inelastic, that is, will not be expanded by reason of a -fall in price, as in the case of salt or coffins, then the displaced -labor will not be reabsorbed in the same industry but must look -elsewhere for employment. - -The elaborate investigation of the Department of Labor in 1898 -regarding the relative merits of hand and machine labor shows clearly -the effect on the displacement of labor by the introduction of -machinery. A few cases will serve as illustrations (see table on next -page). - -These cases, chosen at random, all show an increase in the number of -different men employed, and an immense saving in time and in labor -cost. Nothing is indicated however as to the total amount of -employment. Optimistic writers like Carroll D. Wright claim that if - - Hand and Machine Methods Compared. 103 - - ===========+======================+============+===========+ - Year | | Different | Different | - of | Article produced | operations | workmen + - production | | performed | employed | - -----------+----------------------+------------+-----------+ - 1829-30 | Wheat (hand) | 8 | 4 | - 1895-96 | Wheat (machine) | 5 | 6 | - | | | | - 1859 | Boots (hand) | 83 | 2 | - 1895 | Boots (machine) | 122 | 113 | - | | | | - 1850 | Carpet (hand) | 15 | 18 | - 1895 | Carpet (machine) | 41 | 81 | - | | | | - 1891 |Loading ore (hand) | 1 | 1 | - 1896 |Loading ore (machine) | 3 | 10 | - -----------+----------------------+------------+-----------+ - ===========+======================+================+======== - Year | | Time worked. | - of | Article produced +-------+--------+ Labor - production | | Hours | Minutes| Cost - -----------+----------------------+-------+--------+-------- - 1829-30 | Wheat (hand) | 61 | 5 | $3.55 - 1895-96 | Wheat (machine) | 3 | 19 | .66 - | | | | - 1859 | Boots (hand) | 1436 | 40 | 408.50 - 1895 | Boots (machine) | 154 | 5 | 35.40 - | | | | - 1850 | Carpet (hand) | 4047 | 30 | 20.24 - 1895 | Carpet (machine) | 509 | 1 | .29 - | | | | - 1891 |Loading ore (hand) | 200 | 0 | 40.00 - 1896 |Loading ore (machine) | 2 | 51 | .55 - -----------+----------------------+-------+--------+-------- - -machinery has displaced labor in one direction it has created more -employment for them in others. He shows for instance[29] that the per -capita consumption of cotton in this country in 1830 was 5.9 lbs., -while in 1890 it was 19 lbs., and gives similar figures for iron and -steel, and railroad traffic. It will be noticed that all of his -examples are chosen from industries in which the demand is elastic. -Mr. J. A. Hobson, a more careful and conservative writer, draws less -optimistic conclusions from a study of Great Britain. He says: “First, -so far as the aggregate of manufactures is concerned, the net result -of the increased use of machinery has not been to offer an increased -demand for labor in those industries commensurate with the growth of -the working population. Second, an increased proportion of the -manufacturing population is employed either in those branches of the -large industries where machinery is least used, or in the smaller -manufactures which are either subsidiary to the large industries, or -are engaged in providing miscellaneous comforts and luxuries.”[30] It -must be said, however, in modification of Mr. Hobson’s inferences, -that it may be accounted as a social gain if the demand for -manufactured commodities can be met by the labor of a smaller 104 -proportion of the population, since the energies of the rest are then -set free for professional or artistic or similar pursuits. A study of -the census reports of Great Britain seems to show that this is what -has happened in that country. - -The amount of labor is not the only factor to be considered; the -regularity of employment, as we saw in the last section, is of hardly -less importance. “Another danger of an entirely opposite kind,” says -Professor Nicholson[31], “lurks in this immense power of machinery, -which is continually showing its reality and remedies for which will, -it is to be feared, be the fruit of long years of tentative adaptation -to the new environment. What all sensible workingmen desire, what the -advocates of the trade unions say is their chief object, is to get a -“steady sufficient wage,” but it has been proved inductively that -great fluctuations in price occur in those commodities which require -for their production a large proportion of fixed capital. These -fluctuations in price are accompanied by corresponding fluctuations in -wages and irregularity of employment. But fluctuations in wages and -discontinuities in employment are two of the greatest evils which can -befall the laboring classes.” We have already seen how modern -capitalistic methods of production may lead to over-production and to -a crisis. We now see how machine methods may cause unemployment or -irregular employment. The men displaced directly by new machinery, -those thrown out of work by industrial depression resulting from -over-production in machine industries, and finally those irregularly -employed in the new occupations supplying luxuries--all of these may -fairly attribute their suffering in large measure to machine methods. - -“The second great charge made against the factory system is that it -displaces a higher grade of labor by a lower grade; sometimes 105 -substituting the work of women and children for that of men; sometimes -substituting work under conditions physically or morally unhealthful, -for work under healthful conditions; sometimes substituting -specialized and mechanical work for diversified occupation which -contributes to general intelligence.” The point as to the labor of -women and children has already been discussed. The charge that factory -labor is physically unhealthful may in general be denied. Mr. Wright, -in an elaborate defense of the factory system in the Tenth Census, -concluded that the conditions of work in the modern factory are much -more conducive to good health than those under the preceding domestic -system, while morally they are far superior. The qualities demanded by -the machine production of the modern factory are punctuality, -steadiness, reliability, and sobriety, and it therefore makes against -intemperance and immorality. So far as these exist in factory towns, -they are the result of town life rather than of manufacturing. It -must, however, be said that while the factory system is not inherently -unhealthful, the high pressure at which operatives of steam-driven -machinery are compelled to work, particularly in this country, may and -often does wear him out prematurely. This again is partially offset by -a shortening of the hours of labor. - -The final charge against the factory system is monotony of work. Many -writers, from Adam Smith down, take the view that it is more -stupefying to make a small part of an article, say the sixty-fourth -part of a shoe, than to make the whole article. Professor Marshall, -who has considered the subject carefully[32], concludes that while it -takes away manual skill, it substitutes higher or more intellectual -forms of skill. “The more delicate the machine’s power the greater is -the judgment and carefulness which is called for from those who see -after it.” But after all there is less danger from monotony of work 106 -than from monotony of life, and the cure for this would seem to be in -an increase of machinery rather than in its abolition. - -Let us now try to summarize our conclusions on this intricate -question. The first effects of the introduction of labor-saving -machinery is to displace particular laborers; these suffer real -injury, though they are often reabsorbed in the industrial organism. -The social gain is undoubted, for the improved methods lead to lower -prices and thus to an increase in the real wages of labor. To the -improvement and wider use of machinery we must indeed look for the -ultimate relief of the human race from exhausting toil. Says a -socialist writer: “On mechanical slavery, on the slavery of the -machine, the future of the world depends…. All unintellectual labor, -all monotonous, dull labor, all labor that deals with dreadful things, -and involves unpleasant conditions, must be done by machinery. -Machinery must work for us in coal mines, and do all sanitary -services, and be the stoker of steamers, and clean the streets, and -run messages on wet days, and do anything that is tedious or -distressing.” If labor today has a complaint to make against the use -of machinery, it is that labor has not shared sufficiently in the -improvements thus far effected. But the evil here is connected with -the inequitable distribution of wealth, not with the methods of its -production. In justice labor should share in the technical -improvements which characterized the nineteenth century and will -revolutionize to a still greater extent the industries of the -twentieth. The practical question in this connection is as to the best -method for labor to secure its claim to a share in the increased -production. One answer, to which we will turn next, is by increasing -its efficiency through better industrial education and training. - -The subject of industrial education has recently been receiving -considerable attention in the United States and the needs and -shortcomings of our country in this regard have been described. Under 107 -modern methods of production, with their extreme specialization of -labor and extended use of machinery, it is practically impossible for -a worker to secure an adequate knowledge of a trade in the actual -practice of it. In former days boys acquired training in their trades -by the system of apprenticeship under the immediate charge of a master -of the craft. The system of apprenticeship has today almost -disappeared; boys are taken into shops as helpers, not as apprentices, -and receive practically no systematic instruction in their trade, -especially in a modern large establishment. In consequence of these -facts it is insisted that school instruction should be given to make -good the absence of shop practice; that a general system of industrial -education should be developed to give our workingmen systematic -training in the various trades. The superiority of the opportunities -for industrial education on the continent of Europe, especially in -Germany, have been frequently emphasized, and their industrial advance -has been credited in large measure to this fact. We can probably not -approach the subject better than by explaining the systems in these -other countries and then comparing them with that of the United -States. - -Beginning with Germany as the country in which industrial education -has received the greatest attention, we find there three different -kinds of schools, which we may call the lower, middle, and higher. The -lower group includes artisan and specialized trade schools, and is -intended to be a substitute for the apprenticeship system. While they -have an important influence on the general industrial efficiency of -the nation, they concern chiefly the small handicrafts. The middle -group comprises the trade schools (gewerbeschulen), of which the most -famous are the weaving and dyeing schools at Chemnitz; other branches -taught are soap-boiling, milling, building, pottery, etc. These are -the schools that provide technical instruction for the large 108 -manufacturing industries, and are consequently of great importance; -they train the foremen, superintendents, managers, and heads of -establishments rather than the workingmen. The higher group is formed -of the technical high schools or technological institutes, where are -trained the scientific experts. The importance of the German system -lies in the development of the last two groups rather than in -provision for the training of the workmen. Germany’s recent industrial -advance must be credited to the training of the officers, not the rank -and file, in the industrial army, to the development of managerial -ability rather than of manual skill. - -In England the last twenty years have seen a marvelous development in -industrial education, brought about in part by the “made in Germany” -agitation. The English system differs from the German in educating -working-class boys, while at work in the mill or at the forge, into -foremen, managers, etc., mainly by means of evening classes in trade -or technical schools. The German system, on the other hand, trained -men who already had a superior general education. These schools are -regarded as stepping stones for the more ambitious and intelligent -young workingmen. They give a practical grasp of the subjects, but do -not teach actual processes of manufacture, owing to trade union -objections. They thus come between the lower and middle schools in -Germany. The higher technical schools also exist and have recently -been greatly expanded. - -The system of industrial education in the United States may be said to -resemble that of Germany more than England in that it supplies -industries from above rather than from below, but it is in a very -chaotic state as yet. The most important schools are institutes of -technology and the technical departments of the universities, but -these train men only for the highest positions. Provision for the -industrial training of the workingman is almost lacking except in a 109 -few manufacturing centers. Thus there are a few trade schools -resembling somewhat those in the Middle German group, as the textile -schools at Philadelphia, Lowell, and a few other cities. Lower trade -schools are found in New York City, but hardly anywhere else. That -there is a distinct need of and demand for instruction of this -character is shown by the enormous expansion of correspondence -schools, a peculiarly American institution, which endeavor to give the -training afforded by the English schools to the more ambitious young -artisans. - -So far in their industrial development the people of the United States -have been immensely aided by two factors: the rich natural resources -of the country, and the high quality of the labor. But as we have -already seen, the natural resources are being either rapidly exhausted -or monopolized. As to the character of the second factor, we may quote -from the testimony of a recent careful observer, Dr. A. Shadwell[33]: -“The American method of work in the industrial sphere is distinguished -by the following features: enterprise, audacity, push, restlessness, -eagerness for novelty, inventiveness, emulation, and cupidity. -Employers and employed have exhibited the same qualities in their -degree.”… But they suffer “from the national defect of want of -thoroughness, which arises from the craving for short cuts.” Now that -American industries are entering the markets of the world in -international competition, it becomes important to correct any faults -that will cause us to fall behind. So far the movement for better -industrial education through the establishment of trade schools has -met two obstacles in this country. The first is the hostility of the -trade unions, which fear to see their control of the labor market -disturbed by the annual turning out of hundreds or thousands of -workers from the trade schools without any especial sympathy with -trade union methods or policies. The other difficulty lies in the 110 -satisfaction with prevailing methods, the belief that the American -workman without training possesses skill superior to that of his -European competitors, and a naïve national self-conceit in all things -American. Now that we are for almost the first time in a hundred years -measuring our industrial efficiency in foreign markets against our -European competitors, we shall be compelled to take stock of all the -items that make for industrial supremacy. There seems to be little -doubt that when once this is fairly done, the need of a better system -of industrial education will be recognized and met. - - - - -XII. PROFIT-SHARING AND CO-OPERATION. - - -Among the reforms suggested for remedying some of the evils incident -to the modern wage system those of profit-sharing and co-operation -occupy a prominent place. The separation of the community into -capitalists and laborers, classes different in conditions and ideals, -constitutes a menace to the peace and progress of industrial society. -The wage system moreover is thought by many to have broken down the -former intimate relation of employer and worker, and some scheme is -needed to correlate their interests again and to bind them together. -To secure this result profit-sharing is advocated. As defined by the -International Co-operative Congress in 1897 this is “the agreement, -freely entered into, by which the employe receives a share, fixed in -advance, of the profits.” It is not a change from the present wage -system, but simply a modification of that system according to which -the laborer receives a share in the profits in addition to his wages. -The purpose is to identify the interests of the employes with those of -their employer and thus to give him some of the same motives for -energy, care, and thrift in the conduct of the business. Three -principal methods of profit-sharing may be mentioned, though the -variations are manifold. The favorite method in England and the United -States is the payment of a cash bonus at the end of a fixed period, 111 -as a year. A second plan, which is the rule in France, is a deferred -participation by means of a savings bank deposit, provident fund, or -annuity, for the purpose of providing for old age and disability. The -third plan, which has recently grown in favor in this country, is the -payment in shares of stock of the company. - -The economic theory of profit-sharing is that by inducing greater care -and diligence on the part of the employe he will himself create the -fund from which he is paid. It is claimed by its advocates that it -increases both the quantity and the quality of the product and that it -promotes greater care of implements and materials, thus reducing the -cost at the same time that it increases the output. The classic -example of this is the case of the original profit-sharing scheme, the -Maison Leclaire, in Paris; the result of the first six years’ -experiment was a dividend on wages of $3,753 a year, derived entirely -from the increased economy and care of the workers. In some cases, -however, the object of the employers is to secure immunity from -strikes and other labor disturbances and a greater permanence of the -labor force; and participation in profits is conditioned on the men -abstaining from joining a trade union, or on uninterrupted service. In -these cases the deferred participation plan is used. The advantages -claimed for the system are not merely the increase in product already -spoken of and the greatest efficiency of the worker, but also the -improvement in his material and moral standards, and the promotion of -industrial peace by lessening discontent and friction. The main basis -for the system, since it is economic and not philanthropic in its -nature, must of course be the increase in production brought about by -its adoption. - -More weighty, however, appear the objections against profit-sharing, -which seem to have had sufficient force to cause the failure of a -number of ventures in this direction. In the first place, the 112 -relation between the increased effort of a single workman and the -success of a general business is so remote, especially in our -complicated modern industry, that it is unlikely to act as a very -powerful stimulus. But even if it should, the savings thus effected -might be swept away by the poor business management of the employer. -“It is quite possible that the workman who, in the hope of earning -‘bonus to labor,’ has done work 10 per cent in excess of the normal -standard, may, even under a liberal scheme, find that, instead of -receiving an addition to his normal wages of, say, 7 per cent, the bad -management of his employer has reduced his bonus to so low a level -that he has to be content with a supplement equivalent to only 2 per -cent on his wages, or that, as has been the case in a large proportion -of the schemes … no bonus whatever is forthcoming.”[34] It is -undesirable to make the earnings of the laborer dependent in any way -upon the fluctuations of business or the ability of the employer. The -ordinary wage system has at least the merit that the reward of the -laborer is made dependent only on his own efforts. The lot of the -modern worker is too unstable and employment too unsteady to add a new -element of uncertainty in wages. If the laborer has really earned the -premium, say labor leaders, why not add it to his wages instead of -adopting this roundabout method. The sliding scale, or a system of -premiums or bonus payments for increased output, would be better than -profit-sharing, and is rapidly spreading. - -This leads to the second objection, which is that profit-sharing -paralyzes the efforts of the laborers to better their own conditions -through trade unions, strikes or other methods. The trade union -attitude was vigorously stated by President Gompers of the American -Federation of Labor in his testimony before the Industrial -Commission[35]: - -“There have been few, if any, of these concerns which have been even 113 -comparatively fair to their employes…. They made the work harder, -longer hours, and when the employes of other concerns in the same line -of trade were enjoying increased wages, shorter hours of labor, and -other improvements, tending to the material progress of the worker, -the employes of the concern where so-called profit-sharing was the -system at the end of the year found themselves receiving lower wages -for harder work than were those who were not under that beneficent -system.” As long as the system is viewed with suspicion by the laborer -or used as a weapon in industrial bargaining by employers, the plan is -foredoomed to failure. But even were it managed in the proper spirit, -it is after all applicable to only a comparatively few industries, -those, namely, in which labor makes up the largest part of the cost of -production. In most modern industries capital plays such an important -role as compared with labor that the field for this plan is -comparatively limited. - -In the actual practice of profit-sharing there have been many -interesting experiments, and not a few failures. It may be said to -date from 1842, when M. Leclaire, a Parisian painter and house -decorator, introduced it into his business, and has since spread over -France and England; it has met with little success in the rest of -Europe. In the United States the movement has also been more recent -and of smaller proportions. The reason for this is suggested by -President Hadley as follows[36]: “Where the laborers under the old -wage system are not working up to a high standard of efficiency, there -is more chance for the success of profit-sharing. This seems to be the -reason why it works better on the Continent than in England, and -better in England than in America.” It was estimated in 1900 that -there had been in the entire world some 500 experiments in -profit-sharing, of which about 400 were still in existence: a more 114 -conservative estimate would place the latter number at about 300. - -More radical than profit-sharing, which involves only a change in the -method of payment of wages, is co-operation, which involves a change -of management as well. Its final goal, in the minds of its advocates, -is the radical modification if not ultimate abolition of the present -wage system. While profit-sharing is paternalistic and is directed to -an increase of production, co-operation may be said to be democratic, -and to aim at a more equitable distribution. Under this plan the -laborers hope to divert to themselves the large amount of profits -which they now see going into the possession of their employers. By -eliminating the manager or enterpriser they hope to save his profits -for themselves. Two different kinds of co-operation are usually -distinguished--distributive or consumers’ co-operation, and producers’ -co-operation--which we may profitably take up in turn. - -Successful consumers’ co-operation may be said to have originated in -Great Britain when twenty-eight Rochdale workingmen founded their -famous society of Equitable Pioneers. The success and growth of this -remarkable experiment, starting with a capital of £28, to a great -system of 8,000 members with a capital of £200,000 in 1874, is a most -romantic story. It was largely imitated and retail co-operative stores -sprang up all over England. In 1864 the English Co-operative Wholesale -Society was started, for the purpose of the joint purchase of supplies -for the retail co-operative stores on better terms than these could -secure singly from ordinary wholesalers. It effected large economies -and was successful from the beginning; by 1901 it had a capital of -£2,500,000 and acted as purchaser for over 1,000 retail societies. -From buying, the society soon passed to making its own goods and now -manufactures directly a long list of commodities. In 1868 the Scottish -Wholesale Society was inaugurated upon practically the same plan. 115 -Consumers’ co-operation has met with considerable success in Europe -also. In the United States, however, experiments of this kind have in -general had only a brief existence. It is impossible to say how many -such societies exist today as no adequate statistics on the subject -exist. Trade union stores in New England, the grange stores of the -Patrons of Husbandry and later similar ones of the Sovereigns of -Industry, and a few sporadic movements since in different parts of the -country, show what has been attempted. The reasons for the lack of -success in this country are not hard to find. Co-operation requires a -willingness to take considerable trouble for small economies, which -American workingmen, with their generally high wages, have not yet -been willing to take. It also requires a considerable degree of -homogeneity in thought and interests on the part of a people, which is -naturally less present in the United States with its large admixture -of foreign population than in England or the countries of Europe. - -The methods of the Rochdale Society will serve as an illustration of -the way in which the savings effected by co-operation are distributed -among the members. Any one might become a member upon payment of one -shilling and was then entitled to trade at the store. The prices -charged were those current in the town, but purity of goods was -assured; cash payments were an essential feature. At the end of the -year the profits were divided among the members in proportion to the -amount of their purchases. On the other hand, it may be noted that no -attempt was made to, introduce profit-sharing with the employes, who -are paid ordinary but good wages only. Other forms of consumers’ -co-operation are those which undertake to supply insurance, or credit, -like the co-operative insurance companies, banks, and building and -loan associations. The latter especially have had considerable success -in the United States and have helped many a laborer or man of small 116 -means to the ownership of a home. - -Producers’ co-operation differs from that just described in that it is -a union on the part of laborers to do away with the employer and to -secure for themselves the profits. The object of the first is to lower -prices for the co-operators as consumers; the object of the second is -rather to secure higher prices for themselves as producers by -eliminating the profits of the industrial manager. They hope to -perform his function by their collective effort, and to manage as well -as labor; indeed, by diminishing friction and strikes they even hope -to increase the profits. Examples of successful co-operation of this -sort are not numerous, as it has great difficulties to contend with. -Most of the experiments have failed, though recently it would seem -that the movement is making substantial though slow progress, -especially in France and England. Most of those in the latter country, -however, seem to be of simple industries, as agriculture and -dairy-farming. The most notable example of successful productive -co-operation in the United States has been furnished by the coopers of -Minneapolis, who organized a shop of their own in 1868 and have -steadily increased their business since that time. Other instances -often cited are the wood-workers in St. Louis and boot and shoe -companies in Massachusetts. More recently there has been a -considerable extension of co-operative creameries, cheese factories -and similar businesses of a simple kind. - -The advantages of co-operation are summed up as follows by President -Walker.[37] From the laborer’s point of view: “First, to secure for -the laboring class that large amount of wealth, which … goes -annually in profits to the employer. Second, to secure for the laborer -the opportunity to produce independently of the will of an -employer…. In addition to these, the political economist beholds in -cooperation three sources of advantage. First, co-operation would, 117 -by the very terms of the case, do away with strikes…. Second, the -workman would be incited to greater industry and to greater -carefulness in dealing with materials and with machinery. Third, in no -small degree frugality would be encouraged.” To these may be added -other advantages, mostly realizable, however, in consumers’ -co-operation. Saving in store-room, clerk hire, advertising, -book-keeping, etc., is effected, while above all, the practice of cash -payments saves all loss from bad debts. The initial success of the -Rochdale pioneers was in large part due to the economy in this line, -as a system of long credits burdened the retail trade of England at -the time they began. In this country the large department stores have -introduced this system and have thus been able to give their customers -lower prices, and by so much have lessened the motive for consumers’ -co-operation. The educative effects of successful co-operation upon -the participators in developing habits of thrift, careful management -and a knowledge of business principles, is one of the chief advantages -of the system. The ultimate ideal of enthusiastic co-operators does -not, however, stop short of a mere saving in price. The goal is stated -as follows by the Right Relationship League of America, which has -several co-operative stores in the Northwest: Consumers’ co-operation -is merely the first step which “will lead next to co-operative -production, next to public ownership of natural resources and finally -to complete industrial and economic equality, social and political -right relationship--the Kingdom of God on Earth.” - -The defects of co-operation have already been suggested in the account -of their failure. In the first place, the importance and need of -intelligent and efficient management are usually underrated by -workingmen. They are unwilling to pay high salaries and as a -consequence lose the best men and secure inefficient service. -Co-operation has therefore succeeded best in retail trade where the -processes are comparatively simple, or in those branches of production 118 -where industry counts for most and management for least. But even if -it were possible to secure an efficient and progressive manager for a -co-operative shop, it is found very difficult for a man chosen by the -workmen to enforce discipline among them. A second disadvantage is the -difficulty of securing capital. Where, as in many branches of -large-scale manufacturing today, the average investment of capital -amounts to more than $1,000 per employe, the impossibility of -obtaining this by the contributions of the workers is obvious. Nor are -capitalists usually willing to lend to such organizations, as the -risks are too great. To meet this difficulty Ferdinand Lassalle, a -German socialist, proposed that the state should advance the necessary -capital to associations of workmen. But the experience so far with -productive co-operation would seem to suggest that the social benefits -would not equal the waste of public capital. There is danger also that -if successful the co-operative associations would tend to become -monopolies; they are profit-seeking societies and would probably not -differ materially in their methods from ordinary joint stock -enterprises. - -It seems impossible, therefore, to expect from co-operation a final -solution of the labor problem, such as John Stuart Mill, for instance, -hoped for. Where successful, it has succeeded in distributing profits -among a larger number of persons than would otherwise have received -them. Its educative and moral effects, moreover, in the appeals which -it makes to higher motives and to character, are of the highest value. -But as an industrial system of enterprise it cannot supplant the -present system as long as the manager of industry is needed. Today he -performs a useful social service and profits are his pay therefor. If -he is to be eliminated, society must first be raised to a higher plane -of efficiency, intelligence, and morality. But just because it makes -these high demands upon the members of the laboring class, attempts 119 -at co-operation should receive all reasonable encouragement. - - - - -XIII. PROBLEMS OF DISTRIBUTION. - - -So far we have discussed for the most part those economic problems -that center round the production of wealth, such as the use of natural -resources, large-scale production, trusts and monopolies, labor -organizations, unemployment, industrial education and co-operation. -Now we shall consider briefly a few of the problems that are connected -with the distribution of wealth. Professor Blockmar[38] says that the -three great problems of economic society are: “First, how to create -the largest amount of utilities or wealth; second, how justly to -divide this amount; and third, how to make the product minister to the -permanent rather than to the transient well-being of society.” The -first problem we have already discussed; the second forms the subject -of the present section; while the third will be taken up in the next -section. Within the last century the center of interest in the -practical application of economic principles has decidedly shifted -from production to distribution. The earlier writers in economics, as -shown in the mercantile lists of the seventeenth and eighteenth -centuries, even Adam Smith, were chiefly interested in methods of -increasing a nation’s wealth. With the introduction of the factory -system and the opening up of vast natural resources by improvements in -mining and transportation, the production of wealth has enormously -increased, and now the question of the method of its distribution or -division is felt to be more pressing. - -Under the term distribution two different processes are included, -which should be distinguished before going further. The first is -called functional distribution, and concerns the distribution of the -product of industry or the income of society, among the different -factors of production. That is to say, land, labor, capital and 120 -managerial ability have contributed in varying degrees to the -production of a certain amount of current wealth, and the problem of -functional distribution is to ascertain how the net product resulting -from these joint efforts is divided. How much goes to rent, how much -to wages, how much to interest and how much to profits? The second -kind of distribution is the division of the wealth of society among -individuals or families; this is personal distribution, and raises the -question of poverty and great wealth. In discussing these problems, -however, we must remember that wealth production and distribution -takes place in modern society under conditions imposed by the social -order in which we live; these were defined as competition, private -property and personal liberty. If any modifications of the processes -of distribution were desired, it would undoubtedly be necessary to -alter these fundamental institutions. - -John Stuart Mill held that production was governed by natural laws, -which could be ascertained and stated, but that distribution was -artificial and hence that it was not possible to discover constant and -certain laws governing it. Beginning mainly with Mill, the ethical -question has been more and more asked as to what share each factor in -production ought to get, not merely what he does receive. “Hence the -question is rising more and more as to what should be the basis of -division, and many proposals have been made. It is proposed that -laborers combine to get a larger share. Hence we have trade unions, -Knights of Labor, etc. It is proposed that capitalists and landlords -give a larger proportion of the produce to the laborers than they are -able to secure by mere private struggle. Hence we have proposals for -profit-sharing and various charities. It is proposed that laborers -combine to be their own capitalists and landlords; hence we have all -sorts of co-operative and communistic experiments. It is asserted that -the wealthy classes have so much power in their hands that private 121 -co-operation cannot succeed in competing against them, and hence it is -proposed that all the people, through government (municipal, state, -and national), secure all the means of production (capital and land, -so far at least as land is used for production), and operate them -collectively for the equitable good of all, the people thus being -their own employers, capitalists, and landlords. Hence we have -municipalism, nationalism, socialism. It is claimed that capitalists -and landlords have been able to secure, and are today able to -maintain, their large share in distribution, only through the -favoritism of the Government. Hence we have proposals for free trade, -the single tax,… the extreme proposals of the very great minimizing -of the state in individualism, or the abolition of the Government in -anarchism.”[39] In view of this very imperfect list it is not too much -to say that most of the economic problems that are stirring society -today are connected with the distribution of wealth. - -The first question that suggests itself in the discussion of -functional distribution is as to whether it is actually governed by -natural law, so-called. It is observable that the amounts which go to -rent, to wages, to interest, and to profits are regularly quite -constant. What determines this? The socialists contend that natural -distribution is the only just method and insist that the state should -regulate this just distribution; they are not clear, however, as to -what this natural method is. Henry George uses the same phrase when he -says, “the just distribution of wealth is manifestly a natural -distribution of wealth, and this is that which gives to him who makes -it and secures to him who saves it.” All such statements beg the -question for they all turn on the use of the word natural. Many modern -economists are inclined to assert that the question of distribution is -not an ethical one, not a question of what ought to be but of what 122 -is. Thus Professor Tetter says[40]: “Distribution in economics is the -seasoned explanation of the way in which the total product of a -society is divided among its members. It is a logical question and not -an ethical one.” And Professor Clark writes, “There is, in short, a -deep-acting natural law at work amid the confusing struggles of the -labor market.” It will not be possible, in the brief limits of this -section, to take up all the theories as to the way in which this -distribution is effected among the claimants to a share of the -product, but a few of the more important practical results may be -stated. We shall take up the four different factors in turn. - -Rent is usually defined as the return for the use of natural objects -and agencies. Rent has usually been low in the United States because -of the large amount of land and other natural agents available. In -general it may be said that when any factor of production is -relatively abundant in comparison with the other factors, its share of -the product will be small.[41] Henry George, however, argues that as -the amount of land is limited and is now practically all taken up, the -future will see a constantly increasing demand for land, and hence the -landlords will absorb most of the future income of society. This is -true of most of land and other natural agents especially in demand, as -choice sites in our cities, anthracite coal mines, etc. The practical -problem that suggests itself is, do we wish private property in land? -The socialists answer no, but the individualists insist that the best -use has been and can be made of land only by reducing it to private -ownership. In practice, however, even in modern individualistic -societies, the absolute and unregulated use of land by the owner is -restricted in various ways. - -Interest is the amount paid for the use of capital. From the time of 123 -the church fathers in the Middle Ages down to the present-day -socialists, interest and the private ownership of productive capital -have formed favorite objects of attack. The justification of interest -lies in the fact that men prefer present goods to future goods--a bird -in the hand is worth two in the bush--and interest is the difference -in value between the two at the present moment; it is time value. The -justification of private property, on the other hand, lies rather in -its expediency than in any inherent and unalterable law of nature. It -has developed with civilization and has been, without question, a -fundamental cause of material progress. But moderate individualists -even, as John Stuart Mill, have attacked the institution of -inheritance while leaving the main edifice of private property -untouched. They would limit absolutely the amount of bequest or, as -President Roosevelt advocated, would use inheritance taxes as a means -of breaking up large fortunes. - -Profits are the reward which the manager of a business receives for -his services in organizing and superintending the business. This share -of the social income was the last to be recognized by economists, and -its rightfulness is even yet denied by the socialists. They insist -that profits are really the earnings of labor which have been withheld -from the laborer by the superior skill and economic strength of the -capitalist manager; they are institutional robbery, the exploitation -of labor. It is not possible to take up the arguments on this point, -but it may be said in a word that the manager of business contributes -a needed service to the work of society just as truly as the laborer -does, and receives his earned reward in the form of profits. - -Wages are the reward of labor. It is often assumed that wages are -lower than they should be, that the laborer in some way is deprived of -a portion of what he has rightfully earned. It is worth while -inquiring briefly how the share of labor in the distribution of the 124 -social income is determined. Various theories have been developed to -explain the distributive process, of which we may notice three. The -oldest in point of time and the most pessimistic theory held that -wages were fixed by competition and the growth of population at the -bare subsistence minimum, a bare starvation level. If by some happy -chance wages were raised above this point, then the population would -speedily multiply and the increased competition thus brought about -among the laborers would depress wages again to the lowest amount -sufficient to support a family. Under the name of the “iron law of -wages,” this theory is still put forth by the socialists as the -explanation--together with the institution of private property--of -wages. Historically, however, this theory has happily been proven -untrue, as the advance in the standard of living among the working -class during the past century testifies. It has now been almost wholly -superseded by the so-called productivity theory,[42] which asserts -that wages depend upon the productivity of labor; that the laborer -gets what he produces, and that this share is assured him by the -working out of the competitive process under free competition. If this -theory is true, there can be no ethical question raised; if labor is -dissatisfied with its share, then it must increase its productive -efficiency. As a matter of fact wages have always been high in the -United States because labor has been relatively scarce compared with -land and capital, and consequently its marginal productivity has been -high. The third theory says that wages are a result of bargaining, of -competition in the labor market, a question of supply and demand. -Under these circumstances it is largely a question of economic -strength between labor and capital, and if labor is well-organized, -alert, and able to drive a good bargain, then wages will be high; -otherwise they will be low. While there is an element of truth in -the last theory, the second one seems the truest explanation of 125 -general wages; certain it is that no monopoly power of labor, however -great, could permanently maintain wages at a level higher than the -actual produce of labor. The element of truth in the first theory is -that wages can never, for any length of time, fall below the cost of -subsistence. - -Of more practical interest are questions connected with the personal -distribution of wealth. In this connection arise such problems as the -increase of large fortunes, the causes of poverty, and similar -questions. The boast of our Republic has long been that here -opportunity was open to all, that wealth was widely diffused, and that -such inequalities of fortune as characterized the nations of the Old -World were happily lacking. In the fifty-five years, 1850-1904, the -per capita value of all property in the United States exactly -quadrupled; how has this increase been distributed? Unfortunately we -have no complete statistics on this point, yet reliable estimates by -authoritative writers all tell the same story--of great concentration -of wealth in the possession of a comparatively few rich families. In -1893 Mr. George K. Holmes concluded from a study of the statistics of -farm and home ownership in the United States that “91 per cent of the -families of the country own no more than about 29 per cent of the -wealth, and 9 per cent of the families own about 71 per cent of the -wealth.” A more accurate and satisfactory statement can be drawn from -the income-tax returns for Prussia, which tells almost the same story -with regard to income. The table on the following page is condensed -from an article by Professor A. Wagner: - -According to these figures over two-thirds of the persons--heads of -families or single adults--had only one-third of the income, while -3½ per cent had another third. Another striking fact shown by the -table is the large proportion of persons receiving incomes of less - - Distribution of Income in Prussia, 1902 126 - - ==============+============+============ - | Per cent | Per cent - Income | of persons | of income - --------------+------------+------------ - Below $214 | 70.7 | 33.0 - $214 to $714 | 25.8 | 34.9 - Over $714 | 3.5 | 32.1 - --------------+------------+------------ - -than $214 a year, the minimum taxable income. It shows the poverty of -the mass of the people as well as the concentration of wealth among -the few rich. In the United States, where the natural resources have -been so much richer than in Germany, a similar table would probably -show a much smaller proportion under the Prussian minimum, but on the -other hand it would probably show a greater concentration of income in -the hands of a few. Europe has as yet no billionaire. The great -fortunes of the United States have been made possible by the unrivaled -opportunities for the exploitation of rich natural resources, the -appropriation of natural monopolies, and to special privileges and -opportunities in manufactures and transportation. The importance of -monopoly privileges in the distribution of wealth is well shown by the -results of an investigation made in 1892 by the New York Tribune into -the sources of the fortunes of millionaires. It was undertaken to show -that protection was not the main cause; but while it proved this, it -showed clearly that most of them were built up on monopoly. “Of the -4,047 millionaires reported, only 1,125, or 28 per cent, obtained -their fortunes in protected industries…. About 78 per cent of the -fortunes were derived from permanent monopoly privileges, and only 22 -per cent from competitive industries unaided by natural and artificial -monopolies…. Furthermore, if the size of fortunes is taken into -account it will be found that perhaps 95 per cent of the total values -represented by these millionaire fortunes is due to those investments 127 -classed as land values and natural monopolies, and to competitive -industries aided by such monopolies.”[43] It is essential to the -stability of our democratic institutions that all special privileges -be absolutely prohibited, and that monopoly be brought under strict -government control and regulation. Improper methods of wealth -accumulation should certainly be prevented. - -The opposite question of poverty has already been discussed and some -of the causes of poverty pointed out. It will be sufficient here to -try to answer the question which has often been asked: Are the rich -growing richer and the poor poorer? Though the first part of the -question has just been affirmed, the second part may be denied. The -nineteenth century has witnessed a vast improvement in the condition -of the laboring man, who has shared in the increasing wealth which he -has helped to produce. Wages have steadily increased, the hours of -labor have been reduced, and the material well-being of the -wage-earner is greater today than it has ever been before. It has more -than once been pointed out by writers on this subject that with an -equal distribution of wealth no one would be well-to-do, while many -others insist that inequality in itself is a desirable thing. Greater -diffusion of wealth can come about only by very slow processes, and -permanent plenty can be secured only by a great increase in the -accumulations of capital and the efficiency of each worker. Any -suggested reform, therefore, that would weaken the motives to thrift -and industry must be rejected. - - - - -XIV. SAVING AND SPENDING. - - -The goal and purpose of all economic activities is the satisfaction of -human wants. The object of production is consumption. We work because -we desire and need various things which we can get only if we produce -them or earn the money to buy them. In this section we take up some 128 -of the problems connected with the rational use or consumption of the -wealth which is continually being produced. We have seen something of -the conditions under which it is produced, and the manner in which it -is distributed; we must now study the not less important subject of -its application to human needs and desires. The great question is, how -can we get the largest and most rational return for a given -expenditure? Before trying to answer this question, it will be helpful -to present a summary statement of actual expenditures in different -places: - - Expenditures for Different Purposes. - - ===============+========+==========+=========+=========+========= - Items | United | New York | Great | Prussia | Average - | States | City | Britain | | - | 1903 | | | | - ---------------+--------+----------+---------+---------+--------- - Food | 43.1 | 43.4 | 51.4 | 55.0 | 48.2 - Clothing | 13.0 | 10.6 | 18.1 | 18.0 | 14.9 - Rent | 18.1 | 19.4 | 13.5 | 12.0 | 15.8 - Fuel and light | 5.7 | 5.1 | 3.5 | 5.0 | 4.8 - Miscellaneous | 20.1 | 21.5 | 13.5 | 10.0 | 16.3 - +--------+----------+---------+---------+--------- - Total | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 - ---------------+--------+----------+---------+---------+--------- - -From this table it is seen that practically half of the income of -average working-class families is expended for food, and five-sixths -of it goes for the bare necessaries. It is therefore of the utmost -importance that this be spent wisely. The remaining one-sixth, -included here under the head “miscellaneous,” comprises such items as -education, care of health, comfort, mental and bodily recreation, etc. -It is manifest that this group can be expanded in only one of two -ways: either by enlarging the total income, or by economizing on the -other items by a wiser and better-ordered expenditure. The former -question has already been discussed; here we are concerned only with -the latter. Dr. Frederick Engel, a Prussian statistician, laid down -certain laws with regard to consumption: as the income of a family -increases a smaller percentage is spent for food and a larger 129 -percentage for education, health, recreation, etc.; while the -percentage spent for clothing, rent, fuel and light remains -approximately the same. A higher civilization and culture for the mass -of the people can only be secured by expanding the group of culture -expenditures. As long as these remain unsatisfied for the ordinary -family we cannot claim to have attained our economic goal. The author -of a recent study of conditions in New York City, where the cost of -living is high, concludes that a “fair living wage for a workingman’s -family in New York City should be at least $728 a year, or a steady -income of $14 a week.”[44] The actual earnings are certainly below -this figure. - -One of the problems which has often proved very puzzling is the -relation between saving and spending. At what point should one stop -spending in order to save? If the satisfaction of our wants is the -object of production, why should we save at all? This is the point -urged by the author of a specious little book called “The Fallacy of -Saving.” The problem can be most easily solved by a more careful -analysis of terms. In the popular view, saving involves the withdrawal -of goods or money from use, while spending means putting them to -immediate use. The spendthrift is proverbially popular. “If the rich -do not spend, the poor die of hunger,” said Montesquieu. Saving may -take the form of hoarding or withdrawing things from use, but nowadays -this is practised only by misers; saving ordinarily takes the form of -investment in some productive enterprise, either directly or through a -bank. In this way a demand is created for goods just as truly as -though the money had been spent for a dinner or a suit of clothes. -Saving is spending, but it is spending for the future rather than the -present; it usually causes the production of permanent material goods -rather than transient or immaterial pleasures. Another cause of the -confusion of ideas on this subject is that we always speak of money 130 -and thus lose sight of the acts of production and consumption that lie -back of the money transfer. We see that money is transferred by -spending and think that it increases trade. Consequently, when a -prodigal spends his money foolishly, it is excused on the ground that -it makes employment and puts money in circulation. We forget that it -would have been “put in circulation” just as effectively if he had not -spent it, but had placed it in a bank. If we look back of the money -transfer, we see that usually there has been a foolish or wasteful -expenditure, sometimes an absolute destruction of wealth. A fire which -burns down valuable buildings is an absolute social loss, even though -employment be given to masons and carpenters in putting them up again. - -A third confusion of ideas that exists in the popular mind is due to -an over-emphasis of the desirability of work for its own sake. The man -who “makes work” is thought to be doing a desirable thing, even though -this results from the unnecessary destruction of useful things. Now -the real goal of all rational economic endeavor is not production for -its own sake, but consumption; not work, but the gratification of -wants. Every destruction of durable commodities which lessens the -power to gratify wants is a loss to a community and no juggling with -words can make it anything else. If it gives employment to labor, that -means that the labor has been diverted from the production of other -things to which it would have been devoted. Edward Atkinson several -years ago calculated that every year fires destroyed property in the -United States to the amount $150,000,000.[45] That workmen are -employed to reproduce the buildings, etc., can surely not be reckoned -as a social gain. There is great danger in a commercial age like ours -of forgetting that work is not an end in itself, but simply a means to -an end. But it may be argued that unless these men had been given 131 -employment of this sort, they would have starved. It is conceivable -that during or after a revolution industry would be so interrupted -that ordinary employments would not be open. But in ordinary times -such a statement is simply an assertion of the fallacious -lump-of-labor theory, that there is just so much work to be done and -no more. New wants are continually pressing for satisfaction, waiting -only for the prior ones to be satisfied before they urge their claims. -So soon as the old ones are satisfied, additional employment is -provided in meeting the newer desires. The aim of society is to expand -continually the circle of gratified desires. As durable goods and -agents are accumulated by the process of saving, this becomes -increasingly possible in every progressive society. Useless -destruction involves sheer waste and cannot be justified on any -grounds. - -On the other hand, saving is socially necessary in every industrially -developed community in order to furnish the requisite capital for the -continued production of wealth. Professor Marshall has estimated that -every year one-fifth of the wealth of a nation is used up in the -processes of manufacture and production; just to keep machines, -factories, railroads, and other instruments of production up to the -point of efficiency and restore loss and depreciation would therefore -require considerable saving. If the nation is to grow wealthier and is -to accumulate additional capital, manifestly still more must be saved. -This is done in all progressive countries. Saving is carried on by -individuals, however, and not by nations, and the motives that lead to -it are personal. The most important is probably the desire to provide -for wife and children or other relatives; next to that is the wish to -lay by sufficient for one’s old age. In our individualistic society, -where each family forms an independent unit and is assumed to be -self-supporting, it is very desirable that habits of thrift and saving -be developed. Both from a social and a personal point of view 132 -therefore saving must be approved, though it is undesirable that it -should proceed so far as to prevent spending for the gratification of -essential present needs. - -But what shall we say about expenditures for luxuries? Here the -spending is for the gratification of a want, though it may be out of -proportion to the results. What shall be our attitude to it? This -question is not so easy to answer as the other. Three different -schools have given as many answers to the problem of luxury: the first -condemns it utterly; the second approves it wholly; and the third -takes an intermediate position between the two extremes. Luxury is -condemned by the first school from three points of view: as a question -of individual morals, it is regarded as debasing and enervating, thus -preventing the highest development of the human faculties; as a -question of economics it is condemned as wasteful; and as a question -of right and justice it is incompatible with an equitable distribution -of wealth. It is upon this last point that the opponents of luxury lay -the greatest emphasis. As the quantity of existing wealth is -insufficient to satisfy even the primal wants of the large majority of -our fellow-creatures, we should endeavor to increase this available -store as much as we can, and should refrain from drawing upon it in a -reckless manner in order to gratify superfluous wants. Furthermore, -the productive powers that we can use are, as a matter of fact, -limited; and therefore, if the wealthy classes divert a portion of -these forces towards the production of articles of luxury, there will -be so much the less available for the production of those staple -articles that the masses require for their consumption. In the case of -a Robinson Crusoe this would be perfectly clear: if he devoted several -months to the polishing of a diamond for ornament, he would have to go -without a house or other improvements he might have made in that time. -Or, if he forced his man Friday to spend half his time polishing 133 -diamonds for him, Friday might be compelled to go without sufficient -clothing or food or housing. The same thing is true of organized -society, only the truth is hidden by the phenomena of exchange. It has -been estimated[46] that the annual consumption of wealth in the United -States is divided somewhat as follows: necessaries, six billion -dollars; luxuries, three and one-half billion (of which $900,000,000 -go for liquor and $500,000,000 for tobacco); capitalistic uses, three -and three-quarter billion. It is manifest that if the expenditure for -luxuries was curtailed or abandoned, there would be more to devote to -the other categories. - -The opposite school replies to these arguments that luxury is an -indispensable stimulus to progress; that really all economic progress -is first manifested in the form of a need of luxury, and that luxury -therefore is a necessary phase of its development. Since luxury is -wholly relative, every want or need is, on its first appearance in the -world, regarded as superfluous; first, because no one has hitherto -wanted it, and secondly, because its production probably requires a -considerable amount of labor, on account of man’s inexperience and the -inevitable gropings in the dark that attend all beginnings. The -decencies of life today and even the necessities were once regarded as -luxuries--chimneys in houses, shoes, forks and knives, linen for the -body, bath tubs, etc. If all luxury had always been sternly suppressed -when it made its appearance, all the needs that constitute -civilization would have been nipped in the bud, and we should still be -in the condition of our ancestors of the Stone Age. Civilization -depends on the multiplication of wants. Economic progress is a process -of converting superfluities into conveniences, and conveniences into -necessities. - -The attitude taken by practically all economists today is intermediate -between these two extremes. Moderate luxury is justified, but lavish 134 -and indiscriminate luxury is disapproved of. This justification of -luxury rests upon purely economic grounds. In so far as personal -consumption is the objective point of production, the prohibition of -luxury would act as an impediment to enterprise. If the desire to -enjoy luxuries stimulates the productive powers of economically -important members of society, it is justifiable as a necessary motive -force. The introduction of luxuries and the consequent raising of the -standard of living seems often the only way to secure progress. If the -mass of the people live on the minimum of cheap food, multiply as long -as cheap food is to be had, and spend little for comforts and -luxuries, then most of the labor of such a community must be spent in -obtaining food for the masses. Such is the condition in India and -China. But if a large part of the community has a higher standard of -living, it will exercise self-restraint in the increase of its -numbers, and the whole level of intelligence and comfort will be -raised, as in France or Switzerland or New England. On the other hand, -it is urged that “failure on the part of any family to secure the -necessaries of life is injurious, not only to it, but to the whole -community. Under-consumption means under-nutrition and loss in -industrial efficiency. If permitted to continue it must inevitably -undermine the standards which make a family self-supporting and -self-sufficient and reduce its members to dependency. The general -interest requires, therefore, acceptance of the maxim: the consumption -of luxuries should be deferred until all are provided with -necessaries…. This suggests that no one is justified in spending -income for a luxury for himself or his family that will afford less -happiness than would the same income spent for someone else.”[47] - -But the difficult question at once suggests itself: How can the -surplus incomes of the rich be used so as to provide for the needs 135 -of the poor, without undermining their independence or permanently -lowering their earning power? It has been suggested that there should -be a socialization of luxury; that the rich should use their wealth -for the construction of public art galleries, libraries, parks, baths, -etc., which would thus gratify as great a number as possible. The -feeling is growing in the United States and in the world that wealth -is a social trust, and that the ownership of wealth imposes upon a -person certain moral obligations. While every man has a legal right to -spend his surplus income as he pleases, he is morally bound to spend -it in such a way as to increase the welfare of the whole community. - -Let us now finally take up the problem of economy in consumption. It -is said that an American family will waste enough food for a French -family to live on. The farmer who leaves his implements out in the -rain or his cattle without proper shelter, is guilty of waste. We all -waste clothing by frequent changes in fashion. Such waste is as much -due to a lack of knowledge and training as to carelessness. The single -example of the consumption of food will illustrate this point. “If we -place the average income of an American family at $500--and it will -not greatly exceed that figure--then nearly $250 of this amount is -expended each year for food. Waste occurs in any or all of the -following ways: (1) needlessly expensive foods containing little real -nutriment are used; (2) there is a failure to select the foods best -suited to the needs of the family; (3) a great deal is thrown away -which ought to be utilized; (4) bad preparation of the food causes it -to lose much of the nutriment which it does contain; (5) badly -constructed ovens diffuse heat, instead of confining it, and cause -enormous loss of fuel. We shall state less than the truth if we -estimate that fully one-fifth of the money expended for food is -absolutely wasted, while the excessive expenditure often fails to 136 -provide adequate nutrition.”[48] The remedy for such a waste as this -clearly lies in the teaching of domestic science in our public schools -to the daughters and future wives of the workingmen. As the ordinary -household expenses, as shown above, absorb from 80 to 90 per cent of -the ordinary income, the training of the housewife, under whose -control they fall, is almost as imperative as that of the wage-earner. - -The economic evils of intemperance have already been partially stated -in the objections to luxury. There is, however, one additional -objection to the excessive use of intoxicating liquor which is not -true of most indulgences: it diminishes a man’s productive powers. It -is harmful in its effects upon both consumption and production. Other -items of consumption appear, however, not so clearly under the -immediate control of the consumer. The housing accommodations in many -of our large cities have often been unsanitary and unworthy of being -called homes. Legislation has been necessary to compel the erection of -better tenements and prevent the exploitation of helpless people. So -too it has been found necessary to legislate against loan-sharks, in -order to protect people against their own improvidence and ignorance. -In addition to legislation against positive evils, we must of course -look to education as the great remedy of waste in consumption. - -There is one other phase of the subject of consumption that may well -be mentioned before leaving this subject. Owing to the constant -pressure of the consuming public for cheap goods, many articles are -produced under conditions dangerous to the health, morality and -well-being of the operatives, as in the case of the “sweated trades.” -To remedy these evils consumers’ leagues have been started in many -places, the members of which pledge themselves not to buy goods or to -trade in stores where the conditions of work are not up to certain -prescribed standards. - -They realize that as consumers they owe a duty to other members of 137 -society not to exploit them. While this method has proven a fairly -effective method of protest in some cases, it cannot be looked to as a -solution of this evil. But it emphasizes the fact that the interests -of all members of society as producers and consumers are closely -interdependent, and that the progress of society requires the -improvement of the condition of all. - - - - -XV. MONEY AND BANKING. - - -Probably on no subject has there been such confused thinking or have -such widely varying views been held as on that of money. There is, -however, substantial unanimity of opinion on the important points -among economists today, though in practice there still remain many -unsolved problems. The modern industrial system has already been -characterized as one of capitalistic production, of large-scale -enterprises with extended use of machinery. Not less fundamental are -the processes of valuation and exchange made possible by the use of -money and credit; and also by the machinery for the geographical -distribution of goods, our railroads and steamship lines. The modern -stage of economic development has been described by Hildebrand as one -of “credit economy,” as opposed to those of barter and money economy, -which preceded. It is inconceivable that the modern complex system of -exchange could be maintained without the extended use of money and -credit. Without attempting to define these terms or to trace their -historical development, we may proceed at once to state some of the -problems to which they have given rise. - -The first question that suggests itself is, what determines the value -of money? The generally accepted answer may be briefly stated: it is, -that the value of money depends, other things remaining the same, upon -its quantity. According to the quantity theory an increase in the -supply of money will cause a fall in the value of each unit, just as 138 -an increase in the supply of wheat or cotton will cause a fall in the -value of each bushel or bale. Conversely, a decrease in the quantity -of money will cause a rise in the value of money. It is simply an -application of the general law of value to money. The phrase “other -things remaining the same” is however an important one, for it assumes -that the amount of business and the methods by which it is conducted -will remain substantially unchanged. Of course if an increase in the -amount of money is accompanied by an equivalent expansion of trade, -the one may offset the other and the value of money remain unchanged. -Now, inasmuch as the prices of all goods and services are measured and -expressed in terms of money, it is clear that a fall in the value of -money means a rise of general prices; the value of each commodity is -now expressed in terms of a larger number of less valuable units or -dollars. Prices will be high if the quantity of money in circulation -in a country is large; they will be low if the quantity is small. To -the question, which is better for a country, high prices or low -prices, it may be answered that it is a matter of indifference, -provided only that there is enough money to do the work of exchange -efficiently and that fluctuations are prevented. Just how much -constitutes enough is, however, a matter of contention. In the -undeveloped sections of our country, where capital is scarce and -banking facilities undeveloped and where most of the people are -debtors, there has always been a demand for cheap and abundant money. -Capital and money have been confused and the need of one has led to a -demand for the other. - -It is not a matter of indifference, however, whether prices be rising -or falling, that is, whether inflation or contraction of the currency -is taking place. A period of falling prices means hardship and -injustice to debtors and producers of goods, as farmers, -manufacturers, etc. Having contracted obligations and engaged in the 139 -production of commodities with the expectation of a given price, they -find their goods worth less when ready for the market and themselves -confronted with a loss instead of the anticipated profit. Under such -circumstances a contraction of the currency and falling prices means -lessened production of wealth. Consequently many writers, and even so -good an economist as President Walker, have urged that a slow steady -inflation of the currency would promote trade and “give a fillip to -industry.” The monetary history of the United States is filled with -attempts to realize this in practice: colonial and revolutionary bills -of credit were first issued; when these were forbidden by the new -Constitution resort was had to issues by state banks. When the Federal -Government began the issue of greenbacks and restricted the use of -state bank notes, the inflationists looked to this source for -assistance. After the defeat of the Greenback party, they turned -finally to the coinage of silver, which was now falling in price, and -the question of bimetallism in the United States was made a practical -political issue. - -Down to 1870 practically all the nations of Europe and America had the -system of bimetallism at ratios of 15½ or 16 to 1. About that date -the great increase in the supply of gold and the fall in the value of -silver led one country after another to abandon the latter and to -adopt the system of gold monometallism. This was vigorously resisted -by many persons and several fruitless efforts made to secure a system -of international bimetallism. Failing that, the friends of silver in -this country endeavored to secure independent action by the United -States alone, and were ultimately successful in obtaining the purchase -by the Federal Government of practically the entire silver output of -the country during the years 1878-1893. - - Development of the Manufacturing Industries in the United States, - 1800-1905. - - ======+==========+========================+===========+===========+ - | | Wealth. | | | - | +---------------+--------+ | | - Fiscal| | | | | | - Year,|Population| | | Production| Raw wool | - ending| June 1. | | Per | of | imported. | - June | | Total. |capita. | wool.[B] | | - 30-- | | | | | | - | | | | | | - | | | | | | - ------+----------+---------------+--------+-----------+-----------+ - | | Dollars. |Dollars.| Pounds. | Pounds. | - | | | | | | - 1800 | 5,308,483| -- | -- | -- | -- | - 1810 | 7,239,881| -- | -- | -- | -- | - 1820 | 9,638,453| -- | -- | -- | -- | - 1830 |12,866,020| -- | -- | 35,802,114| 669,883| - 1840 |17,069,453| -- | -- | 52,516,959| 9,898,740| - 1850 |23,191,876| 7,135,780,000| 307.69| -- | 18,695,294| - 1851 |23,995,000| -- | -- | -- | 32,607,315| - 1852 |24,802,000| -- | -- | -- | 18,343,218| - 1853 |25,615,000| -- | -- | -- | 21,616,035| - 1854 |26,433,000| -- | -- | -- | 20,228,035| - 1855 |27,256,000| -- | -- | -- | 18,599,784| - 1856 |28,083,000| -- | -- | -- | 14,778,496| - 1857 |28,916,000| -- | -- | -- | 16,505,216| - 1858 |29,758,000| -- | -- | -- | -- | - 1859 |30,596,000| -- | -- | 60,264,913| -- | - 1860 |31,443,321| 16,159,616,000| 513.93| 75,000,000| -- | - 1861 |32,064,000| -- | -- | 90,000,000| -- | - 1862 |32,704,000| -- | -- |106,000,000| 42,131,061| - 1863 |33,365,000| -- | -- |123,000,000| 73,931,944| - 1864 |34,046,000| -- | -- |142,000,000| 90,464,002| - 1865 |34,748,000| -- | -- |155,000,000| 43,877,408| - 1866 |35,469,000| -- | -- |160,000,000| 67,918,253| - 1867 |36,211,000| -- | -- |168,000,000| 16,558,046| - 1868 |36,973,000| -- | -- |180,000,000| 24,124,803| - 1869 |37,756,000| -- | -- |162,000,000| 39,275,926| - 1870 |38,558,371| 30,068,518,000| 779.83|160,000,000| 49,230,199| - 1871 |39,555,000| -- | -- |150,000,000| 68,058,028| - 1872 |40,596,000| -- | -- |158,000,000|122,256,499| - 1873 |41,677,000| -- | -- |170,000,000| 85,496,049| - 1874 |42,796,000| -- | -- |181,000,000| 42,939,541| - 1875 |43,951,000| -- | -- |192,000,000| 54,901,760| - 1876 |45,137,000| -- | -- |200,000,000| 44,642,836| - 1877 |46,353,000| -- | -- |208,250,000| 42,171,192| - 1878 |47,598,000| -- | -- |211,000,000| 48,449,079| - 1879 |48,866,000| -- | -- |232,500,000| 39,005,155| - 1880 |50,155,783| 43,642,000,000| 850.20|240,000,000|128,131,747| - 1881 |51,316,000| -- | -- |272,000,000| 55,964,236| - 1882 |52,495,000| -- | -- |290,000,000| 67,861,744| - 1883 |53,693,000| -- | -- |300,000,000| 70,575,478| - 1884 |54,911,000| -- | -- |308,000,000| 78,350,651| - 1885 |56,148,000| -- | -- |302,000,000| 70,596,170| - 1886 |57,404,000| -- | -- |285,000,000|129,084,958| - 1887 |58,680,000| -- | -- |269,000,000|114,038,030| - 1888 |59,974,000| -- | -- |265,000,000|113,558,753| - 1889 |61,289,000| -- | -- |276,000,000|126,487,729| - 1890 |62,622,250| 65,037,091,000|1,038.57|285,000,000|105,431,285| - 1891 |63,844,000| -- | -- |294,000,000|129,303,648| - 1892 |65,086,000| -- | -- |303,153,000|148,670,652| - 1893 |66,349,000| -- | -- |298,057,384|172,433,838| - 1894 |67,632,000| -- | -- |309,748,000| 55,152,585| - 1895 |68,934,000| 77,000,000,000|1,117.01|272,474,708|206,033,906| - 1896 |70,254,000| -- | -- |259,153,251|230,911,473| - 1897 |71,592,000| -- | -- |266,720,684|350,852,026| - 1898 |72,947,000| -- | -- |272,191,330|132,795,202| - 1899 |74,318,000| -- | -- |288,636,621| 76,736,209| - 1900 |76,303,387| 88,517,306,775|1,164.79|302,502,328|155,928,455| - 1901 |79,003,000| -- | -- |287,450,000|166,576,966| - 1903 |80,372,000| -- | -- |291,783,032|177,137,796| - 1904 |81,752,000|107,104,211,917|1,310.11|295,488,438|173,742,834| - 1905 |83,143,000| -- | -- |298,915,130|249,135,746| - 1906 |84,216,433| -- | -- |298,294,750|201,688,668| - 1907 |85,817,239| -- | -- |311,138,321|203,847,545| - 1908 |87,189,392| -- | -- | -- |125,980,524| - ------+----------+---------------+--------+-----------+-----------+ - - ======+==========+=====================================================+ - | | Manufactures of cotton. | - |Production+--------------------------+--------------------------+ - Fiscal| of | Thousands of spindles in | Thousands of bales of | - Year,|cotton.[B]| operation on Sept. 1st. | domestic cotton taken | - ending| | | by mills. | - June | (500-lb. +--------+--------+--------+--------+--------+--------+ - 30-- | bales, | In | In | Total | In | In | Total | - | gross |Southern|Northern| United |Southern|Northern| United | - | weight.) |States. | States.| States.| States.| States.| States | - ------+----------+--------+--------+--------+--------+--------+--------+ - | Number. | Thou- | Thou- | Thou- | Thou- | Thou- | Thou- | - | | sands. | sands. | sands. | sands. | sands. | sands. | - 1800 | 73,222| -- | -- | -- | -- | -- | -- | - 1810 | 177,824| -- | -- | -- | -- | -- | -- | - 1820 | 334,728| -- | -- | -- | -- | -- | | - 1830 | 732,218| -- | -- | -- | -- | -- | -- | - 1840 | 1,347,640| 181 | 2,104 | 2,285 | 71 | 166 | 237 | - 1850 | 2,136,083| 265 | 3,733 | 3,998 | 78 | 497 | 575 | - 1851 | 2,799,290| -- | -- | -- | 60 | 404 | 464 | - 1852 | 3,130,338| -- | -- | -- | 111 | 588 | 699 | - 1853 | 2,766,194| -- | -- | -- | 153 | 650 | 803 | - 1854 | 2,708,082| -- | -- | -- | 145 | 592 | 737 | - 1855 | 3,220,782| -- | -- | -- | 135 | 571 | 706 | - 1856 | 3,873,680| -- | -- | -- | 138 | 633 | 771 | - 1857 | 3,012,016| -- | -- | -- | 154 | 666 | 820 | - 1858 | 3,758,273| -- | -- | -- | 143 | 452 | 595 | - 1859 | 4,309,642| -- | -- | -- | 167 | 760 | 927 | - 1860 | 3,841,416| 324 | 4,912 | 5,236 | 94 | 751 | 845 | - 1861 | 4,490,586| -- | -- | -- | 153 | 650 | 803 | - 1862 | 1,596,653| -- | -- | -- | -- | -- | -- | - 1863 | 449,059| -- | -- | -- | -- | -- | -- | - 1864 | 229,372| -- | -- | -- | -- | -- | -- | - 1865 | 2,093,658| -- | -- | -- | -- | -- | -- | - 1866 | 1,948,077| -- | -- | -- | 127 | 541 | 668 | - 1867 | 2,345,610| -- | -- | -- | 150 | 573 | 723 | - 1868 | 2,198,141| -- | -- | -- | 168 | 800 | 968 | - 1869 | 2,409,597| -- | -- | -- | 173 | 822 | 995 | - 1870 | 4,024,527| 328 | 6,804 | 7,132 | 69 | 728 | 797 | - 1871 | 2,756,564| -- | -- | -- | 91 | 1,072 | 1,163 | - 1872 | 3,650,932| -- | -- | -- | 120 | 977 | 1,097 | - 1873 | 3,873,750| -- | -- | -- | 138 | 1,063 | 1,201 | - 1874 | 3,528,276| -- | -- | -- | 128 | 1,192 | 1,320 | - 1875 | 4,302,818| -- | -- | -- | 130 | 1,071 | 1,201 | - 1876 | 4,118,390| -- | -- | -- | 134 | 1,220 | 1,354 | - 1877 | 4,494,224| -- | -- | -- | 127 | 1,302 | 1,429 | - 1878 | 4,745,078| -- | -- | -- | 151 | 1,345 | 1,496 | - 1879 | 5,466,387| -- | -- | -- | 186 | 1,375 | 1,561 | - 1880 | 6,356,998| 561 | 10,092 | 10,653 | 189 | 1,382 | 1,570 | - 1881 | 5,136,447| -- | -- | -- | 225 | 1,713 | 1,938 | - 1882 | 6,833,442| -- | -- | -- | 287 | 1,677 | 1,964 | - 1883 | 5,521,963| 860 | 11,800 | 12,660 | 313 | 1,759 | 2,072 | - 1884 | 5,477,448| 1,050 | 12,250 | 13,300 | 340 | 1,537 | 1,877 | - 1885 | 6,369,341| 1,125 | 12,250 | 13,375 | 316 | 1,437 | 1,753 | - 1886 | 6,314,561| 1,150 | 12,250 | 13,400 | 381 | 1,781 | 2,162 | - 1887 | 6,884,667| 1,200 | 12,300 | 13,500 | 401 | 1,687 | 2,088 | - 1888 | 6,923,775| 1,250 | 12,300 | 13,550 | 456 | 1,805 | 2,261 | - 1889 | 7,472,511| 1,360 | 12,700 | 14,060 | 480 | 1,790 | 2,270 | - 1890 | 8,562,089| 1,570 | 12,814 | 14,384 | 539 | 1,979 | 2,518 | - 1891 | 8,940,867| 1,740 | 12,900 | 14,640 | 613 | 2,027 | 2,640 | - 1892 | 6,658,313| 1,950 | 13,250 | 15,200 | 684 | 2,172 | 2,856 | - 1893 | 7,433,056| 2,100 | 13,450 | 15,550 | 723 | 1,652 | 2,375 | - 1894 |10,025,534| 2,200 | 13,500 | 15,700 | 711 | 1,580 | 2,291 | - 1895 | 7,146,772| 2,400 | 13,700 | 16,100 | 852 | 2,019 | 2,871 | - 1896 | 8,515,640| 2,850 | 13,800 | 16,650 | 900 | 1,605 | 2,505 | - 1897 |10,985,040| 3,250 | 13,900 | 17,150 | 999 | 1,793 | 2,792 | - 1898 |11,435,368| 3,550 | 13,900 | 17,450 | 1,254 | 2,211 | 3,465 | - 1899 | 9,459,935| 3,950 | 14,150 | 18,100 | 1,415 | 2,217 | 3,632 | - 1900 |10,266,527| 4,368 | 15,104 | 19,472 | 1,523 | 2,350 | 3,873 | - 1901 | 9,675,771| 5,500 | 11,700 | 20,200 | 1,583 | 1,964 | 3,547 | - 1902 |10,827,168| 6,400 | 15,000 | 21,400 | 2,017 | 2,066 | 4,083 | - 1903 |10,045,615| 6,900 | 15,100 | 22,000 | 1,958 | 1,966 | 3,924 | - 1904 |13,679,954| 7,650 | 15,200 | 22,850 | 1,889 | 2,046 | 3,935 | - 1905 |10,804,556| 7,631 | 16,056 | 23,687 | 2,140 | 2,139 | 4,279 | - 1906 |13,595,498| 8,995 | 16,255 | 25,250 | 2,373 | 2,536 | 4,909 | - 1907 |11,375,461| 9,528 | 16,847 | 26,275 | 2,411 | 2,574 | 4,985 | - 1908 |13,587,306| 10,201 | 17,304 | 27,505 | 2,187 | 2,352 | 4,539 | - ------+----------+--------+--------+--------+--------+--------+--------+ - - ======+===========+===========+===========+============ - | | | | - | | | | - Fiscal| | | Unmanu- | - Year,| | | factured | Imports - ending| Exports. | Imports. | silk | of crude - June | (domestic)| | imported. | rubber. - 30-- | | | | - | | | | - | | | | - ------+-----------+-----------+-----------+------------ - | Dollars. | Dollars. | Pounds. | Pounds. - | | | | - 1800 | -- | -- | -- | -- - 1810 | -- | -- | -- | -- - 1820 | -- | 7,812,326| -- | -- - 1830 | 1,318,183| 5,774,013| -- | -- - 1840 | 3,549,607| 6,504,104| -- | -- - 1850 | 4,734,424| 20,781,346| -- | -- - 1851 | 7,241,205| 22,164,442| -- | -- - 1852 | 7,672,151| 19,689,496| -- | -- - 1853 | 8,768,894| 27,731,363| -- | -- - 1854 | 5,535,516| 33,949,503| -- | -- - 1855 | 5,857,181| 17,757,112| -- | -- - 1856 | 6,967,309| 25,917,999| -- | -- - 1857 | 6,115,177| 28,685,726| -- | -- - 1858 | 5,651,504| 18,584,810| -- | -- - 1859 | 8,316,222| 26,976,381| -- | -- - 1860 | 10,934,796| 33,215,541| -- | -- - 1861 | 7,957,038| 25,271,382| -- | -- - 1862 | 2,946,464| 8,890,119| -- | 2,125,561 - 1863 | 2,906,411| 14,121,589| -- | 5,104,650 - 1864 | 1,456,901| 14,341,501| 407,935| -- - 1865 | 3,451,561| 9,223,686| 288,286| -- - 1866 | 1,780,175| 27,502,194| 567,904| -- - 1867 | 4,608,235| 19,302,005| 491,983| -- - 1868 | 4,871,054| 17,335,406| 512,449| 8,438,019 - 1869 | 5,874,222| 20,481,312| 720,045| 7,813,134 - 1870 | 3,787,282| 23,380,053| 583,589| 9,624,098 - 1871 | 3,558,236| 29,876,640| 1,100,281| 11,031,939 - 1872 | 2,304,330| 35,307,447| 1,063,809| 11,803,437 - 1873 | 2,947,528| 35,201,324| 1,159,420| 14,536,978 - 1874 | 3,095,840| 28,193,869| 794,837| 14,191,320 - 1875 | 4,071,882| 27,738,401| 1,101,681| 12,035,909 - 1876 | 7,722,978| 22,725,598| 1,354,991| 10,589,297 - 1877 | 10,235,843| 18,923,614| 1,186,170| 13,821,109 - 1878 | 11,438,660| 19,081,037| 1,182,750| 12,512,203 - 1879 | 10,853,950| 19,928,310| 1,889,776| 14,878,584 - 1880 | 9,981,418| 29,929,366| 2,562,236| 16,826,099 - 1881 | 13,571,387| 31,219,329| 2,790,413| 20,015,176 - 1882 | 13,222,979| 35,719,791| 3,549,404| 22,712,862 - 1883 | 12,951,145| 38,036,044| 4,731,106| 21,646,320 - 1884 | 11,885,211| 29,074,626| 4,284,888| 24,574,025 - 1885 | 11,836,591| 27,197,241| 4,308,908| 24,208,148 - 1886 | 13,959,934| 29,709,266| 6,818,060| 29,263,632 - 1887 | 14,929,342| 28,940,353| 6,028,091| 28,649,446 - 1888 | 13,013,189| 28,917,799| 6,370,322| 36,628,351 - 1889 | 10,212,644| 26,805,942| 6,645,124| 32,339,503 - 1890 | 9,999,277| 29,918,055| 7,510,440| 33,842,374 - 1891 | 13,604,857| 29,712,624| 6,266,629| 33,712,089 - 1892 | 13,226,277| 28,323,841| 8,834,049| 39,976,205 - 1893 | 11,809,355| 33,560,293| 8,497,477| 41,547,680 - 1894 | 14,340,886| 22,346,547| 5,902,485| 33,757,783 - 1895 | 13,789,810| 33,196,625| 9,316,460| 39,741,607 - 1896 | 16,837,396| 32,437,504| 9,363,987| 36,774,460 - 1897 | 21,037,678| 34,429,363| 7,993,444| 35,574,449 - 1898 | 17,024,092| 27,267,300| 12,087,951| 46,055,497 - 1899 | 23,566,914| 32,054,434| 11,250,383| 51,063,066 - 1900 | 24,003,087| 41,296,239| 13,073,718| 49,377,138 - 1901 | 20,272,418| 40,246,935| 10,405,555| 55,275,529 - 1902 | 32,108,362| 44,460,126| 14,234,826| 50,413,481 - 1903 | 32,216,304| 52,462,755| 15,270,859| 55,010,571 - 1904 | 22,403,713| 49,524,246| 16,722,709| 59,015,551 - 1905 | 49,666,080| 48,919,936| 22,357,307| 67,234,256 - 1906 | 52,944,033| 63,043,322| 17,352,021| 57,844,345 - 1907 | 32,305,412| 73,704,636| 18,743,904| 76,963,838 - 1908 | 25,177,758| 68,379,781| 16,662,132| 62,233,160 - ------+-----------+-----------+-----------+------------ - - [B] Calendar years. - - Development of the Manufacturing Industries in the United States, - 1800-1905--Continued. - - =====+=======================+============+ - | | | - | Production of | Exports of | - | | domestic | - +------------+----------+ copper & + - Year.| | | manufac- | - | Coal.[C] |Copper.[C]| tures | - | | | of. | - | | | | - | | | | - -----+------------+----------+------------+ - | Long | Long | Dollars. | - | tons. | tons. | | - | | | | - 1800| -- | -- | -- | - 1810| 20| -- | 17,426| - 1820| 3,080| -- | 18,547| - 1830| 285,779| -- | 36,601| - 1840| 1,848,249| 100 | 86,954| - 1850| 6,266,233| 650 | 105,060| - 1851| 7,798,683| 900 | 91,871| - 1852| 8,764,879| 1,100 | 103,039| - 1853| 9,437,757| 2,000 | 108,205| - 1854| 10,698,841| 2,250 | 91,984| - 1855| 11,541,672| 3,000 | 690,766| - 1856| 12,095,469| 4,000 | 534,846| - 1857| 11,910,883| 4,800 | 607,054| - 1858| 12,477,213| 5,500 | 1,985,223| - 1859| 13,958,192| 6,300 | 1,048,246| - 1860| 13,044,680| 7,200 | 1,664,122| - 1861| 14,721,439| 7,500 | 2,375,029| - 1862| 15,612,353| 9,000 | 1,098,546| - 1863| 19,034,877| 8,500 | 1,026,038| - 1864| 21,076,003| 8,000 | 251,272| - 1865| 21,243,012| 8,500 | 991,746| - 1866| 25,896,056| 8,900 | 143,761| - 1867| 27,432,520| 10,000 | 474,110| - 1868| 29,341,036| 11,600 | 479,488| - 1869| 29,378,893| 12,500 | 355,274| - 1870| 29,496,054| 12,600 | 504,741| - 1871| 41,861,679| 13,000 | 188,218| - 1872| 45,940,535| 12,500 | 185,983| - 1873| 51,430,786| 15,500 | 88,711| - 1874| 46,969,571| 17,500 | 356,758| - 1875| 46,739,571| 18,000 | 1,085,688| - 1876| 47,571,429| 19,000 | 3,441,939| - 1877| 54,019,429| 21,000 | 2,913,943| - 1878| 51,728,214| 21,500 | 2,319,901| - 1879| 60,808,749| 23,000 | 2,831,053| - 1880| 63,822,830| 27,000 | 793,455| - 1881| 76,679,491| 32,000 | 824,896| - 1882| 92,456,419| 40,467 | 658,941| - 1883| 103,310,290| 51,574 | 1,404,243| - 1884| 107,281,742| 64,708 | 2,664,964| - 1885| 99,250,263| 74,052 | 5,447,423| - 1886| 101,500,381| 70,430 | 2,602,869| - 1887| 116,652,242| 81,017 | 2,033,523| - 1888| 132,731,837| 101,054 | 3,812,798| - 1889| 126,097,779| 101,239 | 2,348,954| - 1890| 140,866,931| 115,966 | 2,349,392| - 1891| 150,505,954| 126,839 | 4,614,597| - 1892| 160,115,242| 154,018 | 7,226,392| - 1893| 162,814,977| 147,033 | 4,525,573| - 1894| 152,447,791| 158,120 | 19,697,140| - 1895| 172,426,366| 169,917 | 14,468,703| - 1896| 171,416,390| 205,384 | 19,720,104| - 1897| 178,776,070| 220,571 | 31,621,125| - 1898| 196,407,381| 235,050 | 32,180,872| - 1899| 226,554,636| 253,870 | 35,983,529| - 1900| 240,789,310| 270,588 | 57,852,960| - 1901| 261,874,836| 268,782 | 43,267,021| - 1902| 269,277,178| 294,423 | 41,218,373| - 1903| 319,068,229| 311,627 | 39,667,196| - 1904| 314,121,784| 362,739 | 57,142,081| - 1905| 350,820,840| 402,637 | 86,225,291| - 1906| 369,783,284| 409,735 | 81,282,664| - 1907| 428,895,914| 387,945 | 94,762,110| - 1908| -- | -- | 104,064,580| - -----+------------+----------+------------+ - - =====+===========================================+======================+ - | | | - | Production of | Iron and steel + - | | Manufactures. | - +----------+----------+----------+----------+----------+-----------+ - Year.| | | | | | | - | Natural | Iron | Pig | Steel.[C]| Imports. | Exports | - | gas.[C] | ore.[C] | iron.[C] | | | (domestic)| - | | | | | | | - | | | | | | | - -----+----------+----------+----------+----------+----------+-----------+ - | Dollars. |Long tons.|Long tons.|Long tons.| Dollars. | Dollars. | - | | | | | | | - | | | | | | | - 1800| -- | -- | -- | -- | -- | 52,144| - 1810| -- | -- | 53,908| -- | -- | 91,914| - 1820| -- | -- | 20,000| -- | -- | 46,552| - 1830| -- | -- | 165,000| -- | 6,346,287| 322,747| - 1840| -- | -- | 286,903| -- | 8,157,923| 1,127,877| - 1850| -- | -- | 563,755| -- |20,145,067| 1,953,702| - 1851| -- | -- | -- | -- |22,439,297| 2,336,587| - 1852| -- | -- | -- | -- |23,568,649| 2,368,384| - 1853| -- | -- | -- | -- |34,944,002| 2,541,554| - 1854| -- | -- | 657,338| -- |35,456,143| 4,249,959| - 1855| -- | -- | 700,159| -- |28,693,979| 3,803,706| - 1856| -- | -- | 788,515| -- |29,050,101| 4,256,613| - 1857| -- | -- | 712,640| -- |30,743,649| 4,959,238| - 1858| -- | -- | 629,548| -- |20,171,007| 4,843,592| - 1859| -- | -- | 750,560| -- |22,379,743| 5,577,748| - 1860| -- | -- | 821,223| -- |26,158,235| 5,870,114| - 1861| -- | -- | 653,164| -- |21,160,235| 6,039,149| - 1862| -- | -- | 703,270| -- |11,451,707| 4,732,348| - 1863| -- | -- | 846,075| -- |16,152,843| 6,681,417| - 1864| -- | -- | 1,014,282| -- |23,822,876| 7,541,967| - 1865| -- | -- | 831,770| -- |16,660,991| 11,227,294| - 1866| -- | -- | 1,205,663| -- |25,598,147| 4,006,180| - 1867| -- | -- | 1,305,023| 19,643|31,630,519| 9,351,062| - 1868| -- | -- | 1,431,250| 26,786|30,346,768| 10,950,275| - 1869| -- | -- | 1,711,287| 31,250|38,213,717| 10,938,492| - 1870| -- | 3,031,891| 1,665,179| 68,750|40,273,682| 13,483,163| - 1871| -- | -- | 1,706,793| 73,214|53,024,075| 21,189,692| - 1872| -- | -- | 2,548,713| 142,954|67,852,616| 11,463,880| - 1873| -- | -- | 2,560,963| 198,796|74,302,102| 13,655,087| - 1874| -- | -- | 2,401,262| 215,727|46,786,469| 15,098,248| - 1875| -- | -- | 2,023,733| 389,799|31,432,380| 19,534,215| - 1876| -- | -- | 1,868,961| 533,191|23,197,417| 15,449,846| - 1877| -- | -- | 2,066,594| 569,618|19,320,927| 16,501,638| - 1878| -- | -- | 2,301,215| 731,977|18,987,130| 16,053,571| - 1879| -- | -- | 2,741,853| 935,273|19,594,608| 15,133,493| - 1880| -- | 7,120,362| 3,835,191| 1,247,335|71,266,699| 14,716,524| - 1881| -- | -- | 4,144,254| 1,588,314|60,604,477| 16,608,767| - 1882| 215,000| -- | 4,623,323| 1,736,692|67,976,897| 20,748,206| - 1883| 475,000| -- | 4,595,510| 1,673,535|58,495,246| 22,826,528| - 1884| 1,460,000| -- | 4,097,868| 1,550,879|40,147,053| 21,909,881| - 1885| 4,857,200| -- | 4,044,526| 1,711,920|33,610,093| 16,592,155| - 1886|10,012,000| -- | 5,683,329| 2,562,503|37,534,078| 15,745,569| - 1887|15,817,500| -- | 6,417,148| 3,339,071|49,203,164| 15,958,502| - 1888|22,629,875| -- | 6,489,738| 2,899,440|48,992,757| 17,763,034| - 1889|21,097,099|14,518,041| 7,603,642| 3,385,732|42,377,793| 21,156,077| - 1890|18,792,725|16,036,043| 9,202,703| 4,277,071|41,679,591| 25,542,208| - 1891|15,500,084|14,591,178| 8,279,876| 3,904,240|53,544,372| 28,909,614| - 1892|14,870,714|16,296,666| 9,157,000| 4,927,581|28,928,103| 28,800,930| - 1893|14,346,250|11,587,629| 7,124,502| 4,019,995|34,937,974| 30,106,482| - 1894|13,954,400|11,879,679| 6,657,888| 4,412,032|20,925,769| 29,220,264| - 1895|13,006,650|15,957,614| 9,446,308| 6,114,834|23,048,515| 32,000,989| - 1896|13,002,512|16,005,449| 8,623,127| 5,281,689|25,338,103| 41,160,877| - 1897|13,826,422|17,518,046| 9,652,680| 7,156,957|16,094,557| 57,497,872| - 1898|15,296,813|19,433,716|11,773,934| 8,932,857|12,626,431| 70,406,885| - 1899|20,074,873|24,683,173|13,620,703|10,639,857|12,100,440| 93,716,031| - 1900|23,698,674|27,553,161|13,789,242|10,188,329|20,478,728|121,913,548| - 1901|27,066,077|28,887,479|15,878,354|13,473,595|17,874,789|117,319,320| - 1902|30,867,863|35,554,135|17,821,307|14,947,250|27,180,247| 98,552,562| - 1903|35,807,860|35,019,308|18,009,252|14,534,978|51,617,312| 96,642,467| - 1904|38,496,760|27,644,330|16,497,033|13,859,887|27,028,312|111,948,586| - 1905|41,562,855|42,526,133|22,992,380|20,023,947|23,510,164|134,728,363| - 1906|46,873,932|47,749,728|25,307,191|23,398,136|29,053,987|160,984,985| - 1907|52,866,835|51,720,619|25,781,361|23,362,594|40,587,865|181,530,871| - 1908| -- | -- |15,936,018| -- |27,607,909|183,982,182| - -----+----------+----------+----------+----------+----------+-----------+ - - =====+========================================+=========== - | Prices of staple commodities. | - +-------------------+---------+----------+ Washed - | Per ton.[C] | | |Ohio fleece - |---------+---------+ Middling| Standard | wool, per - Year.| | Steel | cotton, |sheetings,| lb., in - | Pig iron| rails, | per | per | eastern - | No. 1, |standard |pound.[C]| yard.[C] | m’k’ts, - | foundry.|sections.| | | July 1. - | | | | | Medium. - -----+---------+---------+---------+----------+----------- - | Dollars.| Dollars.| Cents. | Cents. | Cents. - | | | | | - | | | | | - 1800| -- | -- | -- | -- | -- - 1810| -- | -- | -- | -- | -- - 1820| -- | -- | -- | -- | -- - 1830| -- | -- | -- | -- | 50 - 1840| 27.88 | -- | -- | -- | 39 - 1850| 20.88 | -- | 12.34 | 7.87 | 37 - 1851| 21.38 | -- | 12.14 | 7.08 | 42 - 1852| 22.63 | -- | 9.50 | 6.96 | 38 - 1853| 36.13 | -- | 11.02 | 7.92 | 53 - 1854| 36.88 | -- | 10.97 | 7.96 | 37 - 1855| 27.75 | -- | 10.39 | 7.64 | 40 - 1856| 27.18 | -- | 10.30 | 7.50 | 42 - 1857| 26.34 | -- | 13.51 | 8.90 | 50 - 1858| 22.19 | -- | 12.23 | 8.25 | 37 - 1859| 23.33 | -- | 12.08 | 8.50 | 40 - 1860| 22.70 | -- | 11.00 | 8.73 | 50 - 1861| 20.26 | -- | 13.01 | 10.00 | 30 - 1862| 23.92 | -- | 31.29 | 18.55 | 47 - 1863| 35.24 | -- | 67.21 | 36.04 | 70 - 1864| 59.22 | -- | 101.50 | 52.07 | 100 - 1865| 46.08 | -- | 83.38 | 38.04 | 73 - 1866| 46.84 | -- | 43.20 | 24.31 | 67 - 1867| 44.08 | 166.00 | 31.59 | 18.28 | 49 - 1868| 39.25 | 158.46 | 24.85 | 16.79 | 45 - 1869| 40.61 | 132.19 | 29.01 | 16.19 | 48 - 1870| 33.23 | 106.79 | 23.98 | 14.58 | 45 - 1871| 35.08 | 102.52 | 16.95 | 13.00 | 60 - 1872| 48.94 | 111.94 | 22.19 | 14.27 | 70 - 1873| 42.79 | 120.58 | 20.14 | 13.31 | 48 - 1874| 30.19 | 94.28 | 17.95 | 11.42 | 53 - 1875| 25.53 | 68.75 | 15.46 | 10.41 | 49 - 1876| 22.19 | 59.25 | 12.98 | 8.85 | 35 - 1877| 18.92 | 45.58 | 11.82 | 8.46 | 44 - 1878| 17.67 | 42.21 | 11.22 | 7.80 | 36 - 1879| 21.72 | 48.21 | 10.84 | 7.97 | 38 - 1880| 28.48 | 67.52 | 11.51 | 8.51 | 48 - 1881| 25.17 | 61.08 | 12.03 | 8.51 | 44 - 1882| 25.77 | 48.50 | 11.56 | 8.45 | 45 - 1883| 22.42 | 37.75 | 11.88 | 8.32 | 41 - 1884| 19.81 | 30.75 | 10.88 | 7.28 | 34 - 1885| 17.99 | 28.52 | 10.45 | 6.75 | 31 - 1886| 18.71 | 34.52 | 9.28 | 6.75 | 33 - 1887| 20.93 | 37.08 | 10.21 | 7.15 | 37 - 1888| 18.88 | 29.83 | 10.03 | 7.00 | 39 - 1889| 17.76 | 29.25 | 10.65 | 7.00 | 39 - 1890| 18.41 | 31.78 | 11.07 | 7.00 | 37 - 1891| 17.52 | 29.92 | 8.60 | 6.83 | 35 - 1892| 15.75 | 30.00 | 7.71 | 6.50 | 34 - 1893| 14.52 | 28.12 | 8.56 | 5.90 | 26 - 1894| 12.66 | 24.00 | 6.94 | 5.11 | 21 - 1895| 13.10 | 24.33 | 7.44 | 5.74 | 21 - 1896| 12.95 | 28.00 | 7.93 | 5.45 | 18 - 1897| 12.10 | 18.75 | 7.00 | 4.73 | 23½ - 1898| 11.66 | 17.62 | 5.94 | 4.20 | 29 - 1899| 19.36 | 28.12 | 6.88 | 5.28 | 31½ - 1900| 19.98 | 32.29 | 9.25 | 6.05 | 31½ - 1901| 15.87 | 27.33 | 8.75 | 5.54 | 26 - 1902| 22.19 | 28.00 | 9.00 | 5.48 | 26¾ - 1903| 19.92 | 28.00 | 11.18 | 6.25 | 31½ - 1904| 15.57 | 28.00 | 11.75 | 7.13 | 32½ - 1905| 17.88 | 28.00 | 9.80 | 7.00 | 39 - 1906| 20.98 | 28.00 | 11.50 | 7.25 | 37 - 1907| 23.89 | 28.00 | 12.10 | 7.62 | 36 - 1908| 17.70 | 28.00 | 10.62 | 6.75 | 38 - -----+---------+---------+---------+----------+----------- - - [C] Calendar year. - -The arguments in favor of bimetallism are as various as the motives of -its advocates, but two or three of the more important ones may be 140 -briefly stated. It is urged because it would give a more stable -measure of value than either silver or gold alone could do; and the -evil effects of fluctuations in the value of gold since 1873 are -pointed out to illustrate this contention. Monometallists answer this -by asserting that most of the price changes can be accounted for by -improvements in production; that even if they were caused by a -contraction of the currency, this was simply one of the risks of -business; and finally, that the evil effects of falling prices are -offset by a corresponding reduction in interest rates. A second -argument of the bimetallists was the alleged insufficiency of gold on -which to do the world’s business. As this has been practically met by -the phenomenal increase in gold production in the last decade, -especially since the gold discoveries in Alaska, it is not necessary -to dwell upon this argument. On February 1, 1909, the per capita -circulation of money in the United States reached $35.00, the highest -point in our history. A final argument of the bimetallists concerns -foreign trade: it would facilitate this by establishing a fixed -par-of-exchange between all countries. While the weight of this may be -admitted, it has been practically deprived of all force by the -adoption of the gold standard by virtually all the industrially -developed nations of the world. This last fact shows that the question -has now been actually settled by the logic of events and today the -issue of bimetallism has only an academic interest. - -Another problem connected with money which has been removed from the -arena of oratory to that of calm discussion is that of government -paper money. It is urged, with much truth, that if a nation issued -paper money instead of gold or silver, it would save all the expense -of mining these metals. It would resemble, as Adam Smith said, the -discovery of wagon roads through the air in the realm of -transportation. Another argument advanced in favor of government paper -money is that it would be possible by a scientific adjustment of the 141 -issues to regulate the amount of money in circulation and so to -prevent all fluctuations in prices. Both contraction and inflation -would be prevented and a cheap and yet ideal system of money would -exist. Still others see in this form of money an instrument for the -creation of wealth; this last argument simply results from a confusion -of ideas and need not be dealt with. A sufficient answer to the other -two is an appeal to the lesson of history: no government which has -embarked upon the issue of paper money has ever been able to restrict -the issues within reasonable limits; often it has led to national -bankruptcy and the repudiation of the entire issues. The experience of -the United States with the greenbacks has been more fortunate than -that of many countries, but does not tempt to further experiment. - -The monetary situation in the United States today may be regarded as -fairly well settled. Although we have a very heterogeneous assortment -of different kinds of money, a fairly distinct sphere is allotted to -each, and as the basis for all, the gold standard has been definitely -established by law. Money of large denominations consists of gold and -gold certificates (lowest denomination, $20), of greenbacks and -national bank notes (lowest denomination, $10, though one-third of -bank notes may be $5); the needs of retail trade are met by the issue -of silver certificates and silver dollars, and of fractional currency. -The system would be much simplified by the retirement and destruction -of the $346,000,000 in greenbacks, but as there is now a fifty-per -cent reserve in gold back of them, little danger need be apprehended -from their presence. Many people have regarded the existence of some -$500,000,000 worth of silver dollars as a menace to the goodness of -our money supply, but as the amount of gold in circulation increases -the silver will form a constantly smaller percentage of the whole. It -is a cumbersome and not very valuable asset of the Government, but 142 -is now almost powerless for good or ill. - -Important as is the subject of money and essential as is the need of a -standard of undoubted goodness, it is overshadowed in practical -significance by the problems of banking and credit. An investigation -by the Comptroller of the Currency some years ago showed that over 90 -per cent of the receipts of the national banks consisted of credit -instruments, while probably 60 per cent of the trade of the country -was carried on by credit rather than by cash transactions. A credit -transaction is a transfer of goods or money for a future equivalent; -the element of time is introduced. This makes possible an enormous -increase in the number of exchanges and obviates the necessity, to a -large extent, of using money. Most of us enjoy personal credit, which -is limited only by our ability to persuade other people to trust in -us. But this power of purchasing things without immediate payment must -be made readily available if the ordinary business man is to make use -of it. This is done through the medium of a bank, whose business it is -to discount the notes of its customers, which in turn is based upon -confidence in their prospective earnings. The bank credit thus -obtained may be transferred by means of checks to other persons and to -other banks. It is the most fluid and volatile means of payment yet -devised, and is subject to dangers and abuses. In the last analysis -business based upon such a system of credit rests upon confidence in -the honesty of individuals and in the enforcement of the law governing -contracts, and also in the ability of those who have pledged -themselves to future payment to make good their obligations. In times -of panic credit fails and resort is had to money. - -The fundamental institution in our credit economy is the bank, and it -is therefore essential that it be thoroughly safe and responsive to -the needs of the business world. A bank may furnish its customers 143 -with the ready means of payment they need in exchange for their future -promises either in the form of bank notes or bank credit. The former -are more largely used on the continent of Europe and in rural -districts in this country, the latter by England and the United -States, especially in the cities. The preference for one or the other -seems to be a matter of geography. The issue of bank notes has been -very carefully safeguarded since the establishment of the national -banking system in 1863. They are based upon the purchase of government -bonds and are absolutely safe. They lack, however, one essential -quality of good bank money in that they are quite inelastic. That is -to say, the amount of bank notes in circulation does not vary -according to the needs of business, increasing to meet an increased -demand, and then declining again when the demand has passed. Being -based upon government bonds and not upon the value of business assets, -they vary in amount only with the price of the former and not at all -with the volume of the latter. - -The main practical problem connected with our banking system is, -therefore, to find some other basis for the issue of bank notes, -especially as it is not desirable to maintain a permanent bonded -indebtedness solely for this purpose. Various suggestions have been -made, as the establishment of a central bank with sole power of issue, -like the government banks in European countries. This is a favorite -proposal with the big bankers, but is unlikely to be adopted as it is -directly contrary to the spirit of the existing system. The Canadian -system is held up as a model, with its system of branch banking and 5 -per cent safety fund for the redemption of the notes of failed banks. -Curiously enough this was copied after the system in operation in New -York State, which was nipped in the bud by some early mistakes and by -the development of the national banking system. It works admirably in -Canada and is well worth careful study. The plan of asset currency 144 -is another suggestion, according to which bank notes should be issued -up to a certain percentage of the resources of the bank, but without -pledging any specific property for their redemption as is done in the -case of the national banks at present. It has finally been urged that -our present bond deposit system should be modified by substituting -state, municipal, railroad, or industrial bonds for those of the -Federal Government, but that in other respects the system should be -left intact. We may look for legislation along one or another of these -lines in the next few years, as the subject is an urgent one whose -solution cannot long be postponed. - -Another problem is connected with the money reserves that the banks -are required by law to keep on hand in order to meet demand -liabilities. Under the national system in the United States the -country banks may deposit three-fifths of their lawful reserves with -banks in reserve cities, and these banks in turn may deposit one-half -of their reserves in banks in central reserve cities (New York, -Chicago, and St. Louis). Thus there is a massing, under this system, -of the bank reserves of the country in the city of New York, and -within that city in some twenty banks. While there is great economy in -such a system the concentration of reserves is certainly attended by -great dangers, not the least of which is its use by speculative -influences in the New York money market, as a great part of it is -loaned out to speculators on call. - -Still another practical problem connected with the monetary and -banking system of the United States is that of the independent -treasury system. The Federal Government is to a large extent its own -banker; it collects, disburses its revenue and keeps its money in its -own vaults; it even, as we have seen, issues paper money and keeps a -reserve therefor. By its action in withdrawing large amounts of money -from use, or on the other hand making large disbursements, it can and 145 -does affect the money market vitally and sometimes disastrously. While -it is permitted to deposit funds in selected national banks and has -recently made increasing use of this privilege, thus correlating in a -measure the reserves of the Government and the needs of the business -community, it is held by most students that the independent treasury -system should be abolished, and that the banks should act as the -intermediaries between the Government and the people in the collection -and expenditure of its funds. - -So far we have been discussing commercial banks, but there is another -kind of institution which goes by the same name but serves quite a -different purpose, namely, the savings bank. The essential and almost -the only requirement of such an institution is safety. As we have -seen, it is not only desirable for personal reasons to inculcate -habits of saving and thrift in individuals, but it is also necessary -to secure the accumulation of capital needed in modern industry. It is -therefore important that such institutions should be widespread, -accessible, and thoroughly trusted. These requirements seem to be best -fulfilled by the postal savings banks in England and elsewhere, which -have led to a great increase in savings on the part of the people. The -introduction of such a system in the United States is greatly to be -desired. - - - - -XVI. TRANSPORTATION AND COMMUNICATION. - - -Almost as important for the conduct of modern industry as machine -methods and credit are the rapid means of transportation and -communication furnished by our railroad, steamship, express, post -office, telegraph and telephone systems. Indeed the development of -industry on a national scale and its integration under centralized -control has been made possible only by these improvements. But not -only have these businesses rendered the centralization of industry -possible; they themselves exhibit on a national scale concentration 146 -of control. They are all industries of increasing returns and lend -themselves naturally to monopolistic control. At the very beginning of -railroad construction one of the most far-sighted managers enunciated -the doctrine that “where combination is possible competition is -impossible.” For years competition was regarded as the regulator of -rates, pooling between railroads was forbidden, canals were advocated -as competitors, and by every possible device it was sought to -stimulate it. We are at last beginning to recognize the monopoly -character of the railroad industry and to regulate it accordingly. - -Consolidation in the railroad world is not a new phenomenon nor is it -confined to that industry, but it has proceeded further there than in -any other line of business. The first form which combination took was -that of pooling, according to which the traffic was “pooled” and the -earnings then divided among the companies entering into the pool -according to some previous agreement. This was forbidden by the -Interstate Commerce Act in 1887 and even more stringently by the -Anti-Trust Act of 1890, and accordingly railroad managers next -resorted to actual consolidation of competing lines. Where this has -not been possible or desirable, virtual combination has been secured -by the so-called “community of interests” arrangements, based on the -acquisition by one road of enough stock in competing lines to secure -representation on their boards of directors. Today some eight or nine -groups of capitalists control over two-thirds of the railway mileage -of the United States, and according to a recent widely-published -statement the late Mr. E. H. Harriman was credited with controlling, -directly or indirectly, a system aggregating over 67,000 miles. These -great consolidations have followed mainly the territorial groupings of -railroads; the United States has now been districted out by a few -large transportation companies, much as France, Italy, England and -other European countries had previously been divided up. Consolidation 147 -has in many instances resulted in increased convenience to the public -and in economies in management and operation, but it places a -dangerous amount of power in the hands of a few men, which has not -infrequently been abused, and should clearly be under strict -government control. - -The primary economic problem connected with railways is always the -question of rates. This has been called in a recent book “the heart of -the railroad problem.” The first fact that strikes the student of the -subject is the great reduction in rates and fares in the past -twenty-five years, especially in freight rates. From 1.24 cents in -1882 the average revenue per ton mile received by railroads in the -United States has decreased to .748 cents in 1906. Freight rates, -especially through rates for bulky traffic, are considerably lower in -this country, and passenger fares somewhat higher, than in Europe. But -the vital problem connected with rates is not as to their relative -cheapness or extortionateness; it concerns rather the granting of -discriminating rates. Discriminations may be of three kinds: those -between different classes of goods, those between localities, and -those between persons. The first group is based upon the -classification of freight and rests upon differences in cost of -shipment, in bulk, in risk, etc. If reasonably employed, this kind of -discrimination is justifiable. Local discriminations, that is, -charging different rates to different localities for substantially the -same service, is not only unwarranted in most cases, but is -short-sighted as well. Where superior facilities or especially keen -competition exists, lower rates may be permitted for favored -localities, but the arbitrary exercise of such powers by railway -officials is thoroughly unjustifiable. Even less defensible is the -practice, now happily less frequent, of granting discriminatory rates -to favored individuals or corporations. They have been given by means 148 -of secret rates and rebates, by under-billing and under-classification, -by free passes, etc. Both of these latter evils have been forbidden or -greatly restricted by the passage of the Interstate Commerce Act in -1887 and subsequent legislation. - -The public nature of railroads is now fairly well recognized in our -law and is beginning to be understood by the people at large. -Railroads enjoy peculiar privileges in the grant of corporate -franchises and charters, in the right of eminent domain, and in -enormous grants of land and money which have been made to them in this -country. Moreover in the functions they perform the social character -of their duties is emphasized, and they are under the necessity of -maintaining a constant service open to all. Though they are owned by -private investors and managed as private enterprises, they are -essentially public enterprises as to their privileges, functions, and -duties. Consequently most of the states have now undertaken, through -commissions, to regulate the railroads in the public interest. Some -thirty-one have appointed commissions, which probably control -four-fifths of the traffic originating and ending in a single state. -These state commissions differ in power, those of the Mississippi -Valley and the South usually having mandatory powers, that is, power -to prescribe and enforce maximum rates. In the eastern and central -states commissions with supervisory powers merely, of investigation -and report, have been created. The only exceptions are found in the -Far West where the need of improved transportation facilities is more -pressing than regulation, and in five eastern states whose -legislatures are controlled by the railroad interests. While the state -commissions have done and are doing valuable service, it is clear that -the growth of giant railroad combinations which traverse several -states necessitates federal control. The appointment of the Interstate -Commerce Commission in 1887 established the principle of federal -regulation, but the application of the principle in active practice has 149 -been slow and has been impeded by the courts. The final control of -rates has not yet been given to the Commission. - -Owing to the individualistic character of our institutions and law, -public ownership of railroads does not exist in the United States, -which thus forms, together with England, almost the sole important -exception to the world’s practice in this regard. On the continent of -Europe government ownership is the rule. Public control through either -ownership or regulation by commission is essential to secure an -equitable adjustment of public and private rights and to prevent the -abuse of monopoly power inherent in the very nature of railroads. -Public ownership has many advantages and has given satisfactory -results in Europe. But for the United States the principle of private -ownership with stricter governmental regulation has been definitely -laid down; the problem of the future is simply how far that control -shall go. - -The discussion of our steam railroads does not exhaust the subject of -transportation. A recent and important development is the growth of -electric interurban railways, which are opening up districts untouched -by the more expensive steam roads and exercising a marked influence in -rural districts upon business and social life. A more significant -problem, both because of its close relations to the railroads and its -monopoly character, is offered by the express companies. Organized at -a time when railroads were new and undeveloped they took over the safe -and expeditious delivery of small and valuable articles. They have -since grown in importance and power; six large companies now control -over 90 per cent of the business. Since they are generally in the form -of partnerships and not of corporations it has not been possible to -bring them under legal control, and their rates are extremely -high--three or four times as much as freight rates. In some cases the -railroads, in order to gain the profits from these high rates, have -themselves organized express companies to operate over their lines, 150 -immune from interference by the Interstate Commerce Commission. Even -where that is not done, the express companies are performing a service -which could as well be performed by the railroads themselves and at -lower rates. These facts have lent great strength to the demand for -the establishment by the Federal Government in connection with the -post office of a parcels post, such as exists in England and in most -European countries. By the extension of the maximum limit of mail -packages to ten or fifteen pounds the usefulness of the post office -could be immensely increased without any loss in rates. So far, -however, the express companies have been strong enough to resist the -introduction of this reform, though it is warmly advocated by the -present Postmaster-General. A recent important improvement in our -postal service has been the extension of rural free delivery to the -farming districts, thereby breaking down to a great extent the -isolation of country districts. This and the rural telephone have been -of great social value. - -The importance of the telephone and telegraph in our modern industrial -life cannot be overestimated. As means of transmitting intelligence -they have served to bring the most distant parts of the world into -almost instant touch, and have made possible the modern centralization -of business. Both offer the same problems of monopoly that we have -seen exist in other parts of this field, the telegraph business being -completely monopolized by two large companies, the telephone business -by one, all strongly entrenched behind patents. The desirability of -public ownership of these utilities rests upon stronger grounds than -in the case of railroads and is strongly urged by many conservative -writers. - -Although attention has usually been centered upon the railroads in any -discussion of the transportation question in the United States, there -are important practical problems connected with both the inland and 151 -the ocean water transportation. The questions of constructing -artificial inland waterways and of subsidizing our foreign merchant -marine are vital political and industrial issues. The United States is -probably better provided with internal navigable natural waterways -than any other country. Her navigable rivers comprise some 18,000 -miles. Affording access to the very heart of the continent both from -the Atlantic coast and from the Gulf. They form a cheap and convenient -means of transportation, especially for bulky and cheap articles; -30,000,000 tons a year are carried on the streams of the Mississippi -Valley alone, though much of the former traffic has been diverted to -the railroads. On the northern border of the country the Great Lakes -form an unrivaled series of inland seas. The traffic on these shows a -great increase every year, amounting now to over 60,000,000 tons -annually. The Federal Government has performed useful service in -improving the conditions of navigation along these natural waterways, -and is now considering a comprehensive scheme for their further -improvement. - -A very different problem is offered by our canal system. During the -period 1820-1840 many canals were constructed by the states to connect -existing waterways and provide an outlet for produce from the -interior. The best examples of these were the Erie and the Ohio -canals. After the development of the railway, however, traffic began -to be steadily and then rapidly diverted from the canals to these -quicker avenues of transportation. Many of the canals were bought up -by their rivals and permitted to fall into disuse, while those -retained by the state governments remained mere shallow ditches, -unimproved and ill-adapted to modern needs. The recent appropriation -by the people of New York State of over $100,000,000 for the -improvement of the Erie Canal, and the construction of the Panama -Canal by the Federal Government have brought the question of the 152 -rehabilitation of our neglected canal system to the front again. It -seems wasteful not to connect the separate links in the magnificent -system of natural waterways already provided by nature, and this will -probably be the first step taken. And indeed a beginning has already -been made by the construction of the Hennepin Canal, the Des Plaines -Canal, and others, and a company has been formed to connect Pittsburg -with Lake Erie and to cut through Cape Cod. It must, however, be borne -in mind that there are two distinct types of canal: those which are -simply short connecting links between navigable waterways and which -permit the passage of vessels used on those waters; and those canals -which are shallow, have extensive lockage, and permit the use of only -small boats, thus necessitating the transshipment of freight. One -might well advocate the construction and enlargement of the first -type, and yet hesitate to approve of the second. As yet, however, -owing in part to the opposition and clamor of railroad interests, the -question of canals has not received the attention it deserves in the -United States. - -The ocean merchant marine comprises two widely different branches, the -coastwise and the foreign trade. The former is open only to vessels -flying the American flag, and has shown a very steady growth; -five-sixths of our ocean merchant marine today is engaged in this -branch of commerce. Coal, lumber, cotton, and similar bulky -commodities constitute the chief items entering into the coastwise -trade. The tonnage of American vessels engaged in the foreign trade, -on the other hand, has shown a steady decline ever since the outbreak -of the Civil War. Foreign vessels today carry fully 90 per cent of the -foreign commerce of the United States. The causes of this decline are -economic rather than political, for American legislation has on the -whole been very liberal to the shipping interests. At the time the -western part of our country began to be opened up and its great -resources exploited, our merchant marine was one of the best in the 153 -world. But now the other opportunities for the investment of capital -were so profitable and alluring, and the need of it so great, that all -the available labor and capital of the American people began to be -devoted to the development of their internal resources. A nation -cannot do everything with equal advantage at the same time any more -than an individual can. Accordingly we began to withdraw our capital -from shipping and devote it to agriculture, mining, manufacturing, -transportation, and similar more profitable enterprises. Foreigners -could build vessels and run them more cheaply than we could and it -paid us to hire them to do it. Recently, however, and especially since -the recent awakening of a national consciousness after the -Spanish-American War, the patriotism of many individuals has been hurt -by the thought that we had to depend upon foreign vessels for the -carriage of our foreign commerce, while in the minds of others a -comprehensive naval program demanded the building up of a native -merchant marine. Two questions suggest themselves here: Do we wish to -stimulate this growth artificially? And, if we do, what means shall we -adopt? On the second point the Merchant Marine Commission of 1904 -recommended for the United States a general bounty on all shipping, -such as France has, and the subvention of certain lines of steamers -over ten specified routes, following the example of Great Britain, -Germany, and Japan. Without committing ourselves on this point, it may -be suggested that on political, geographical, and economic grounds we -may expect in the near future to see the natural development of an -American merchant marine. With the growth of our foreign trade, the -accumulation of capital at home, and the building up of a strong navy, -the conditions for American shipbuilding and shipping will become -steadily more favorable, and we may expect to see American enterprise -engage in this as in other lines of industry. Eventually we are 154 -destined to become a maritime nation. - - - - -XVII. TAXATION AND TARIFF. - - -In no way does the State affect the interests of its citizens more -vitally than in the sphere of taxation. The State in modern society is -the people organized for certain collective purposes, as for the -public defense, the preservation of domestic peace, and the -furtherance of the social and industrial welfare. To carry out these -objects money is needed and the State has therefore to collect from -its citizens sufficient revenue to defray its expenditures. John Fiske -has tersely defined taxes as “portions of private property taken for -public purposes.” Taxation thus implies a certain degree of -compulsion; by it the Government interferes with the free choice of -the individual and expends a part at least of his income for him in -ways that he himself might not have chosen. The social and industrial -consequences of a system of taxation may also be far-reaching and -important. As Professor R. T. Ely says: “Taxation may create -monopolies, or it may prevent them; it may diffuse wealth, or it may -control it; it may promote labor or equality of rights, or it may tend -to the establishment of tyranny and despotism; it may be used to bring -about reform, or it may be used to aggravate existing grievances and -foster dissensions between classes.” It is evident therefore that the -utmost care should be exercised in framing a system of taxation. - -Certain canons or rules of taxation were laid down by Adam Smith over -a hundred years ago and have been generally endorsed by economists -ever since. One was that taxes ought to be certain and not arbitrary, -as to amount, time and manner of payment; another was that taxes ought -to be levied in the manner most convenient to the tax-payer; and a -third, that taxes ought to take as little as possible out of the -pockets of the tax-payer over and above what is paid into the public 155 -treasury. These three maxims--certainty, convenience, and -economy--have been generally accepted, but less general agreement -exists in regard to the fourth, which states that the subjects of -every state ought to contribute to the support of the Government as -nearly as possible in proportion to their respective abilities. This -rule has given rise to two problems: first, is ability the most just -basis of taxation; and secondly, if so, how is ability to be measured? -The theory of justice generally accepted by legal writers and by the -American courts is expressed in the maxim that taxes should be -proportioned to benefits received. The benefit theory affords a good -rule in the assessment of local property taxes, but fails utterly in -the domain of national and state affairs. Who can measure the benefits -to each individual of an appropriation for a new war ship or for a -state penitentiary or for the public school system? Probably the -benefits are in inverse proportion to the income or wealth of the -individual, and the heaviest taxes would then have to be apportioned -to those least able to pay. Most economists today agree that taxes -should be apportioned according to “faculty” or ability to pay. It -satisfies better our sense of fairness and is more readily applicable -than the benefit theory. In the last analysis, of course, it may be -said that taxation in general must confer real benefits upon society -or it will not be tolerated. Here, however, we are concerned with a -rule of apportionment. - -The second practical problem encountered is when we attempt to apply -the faculty principle in practice; how is ability to be measured? -Three measures have been suggested: expenditure, income, and property. -Expenditure is open to the objection that it would place an unduly -large proportion of the tax burdens on the poor, whose expenditures -are larger in proportion to their means than those of other classes of -society. Property is objected to because large classes of society, 156 -including professional men with large incomes, would then escape -taxation largely or altogether. Income on the surface seems the -fairest measure of ability, but is objected to because the incomes of -different individuals, both on account of source and size, really -indicate unequal and not similar abilities. In practice, however, all -three methods are employed in all advanced states, so it is not -necessary to decide which is theoretically the fairest. - -Still another practical question confronts us after we adopt the -ability theory: Shall the rate of taxation be the same no matter what -the amount of the property or income, or shall it increase as the -amount grows larger? In other words, shall taxation be proportional or -progressive? In general the advocates of the ability theory also -support progression, though there are many exceptions to this -statement. Three main arguments have been urged in support of this -method. First, progression is advocated in order to secure equality of -sacrifice; it is argued that each dollar of a $10,000 income affords -less gratification to the owner than each dollar of a $1,000 income, -and that consequently in order to equalize the sacrifices of the two -individuals a larger proportion of the first income should be taken -than of the second. Objection is made to this, that wants expand even -more rapidly than incomes and therefore the initial assumption is -untrue. Progression is urged, in the second place, by those who desire -to use taxation as a method of introducing social reforms or of -bringing about a more equitable distribution of wealth, as by the -breaking up of large fortunes. It seems inadvisable, however, to use -the machinery of taxation for such purposes. Other writers urge that -the ability to earn or produce wealth increases at an accelerating -rate, and that taxation should therefore keep pace with it. “It is the -first thousand that counts.” The objection is made here that it would -penalize ability and energy. In general, while the arguments are not 157 -conclusive, progression certainly secures a nearer approach to the -ideal of the ability theory than does proportional taxation. The -practical application, after we accept it, is still a difficult -matter. It should be applied to the revenue system as a whole by the -careful selection of special taxes. As a matter of fact we have just -the opposite system in the United States, for the poor man undoubtedly -pays out a larger proportion of his income in taxes--principally on -articles of consumption--than do his wealthy neighbors. - -In the main there has been a clear division in the United States -between the sources of income of the Federal Government on the one -hand and those of the state and local governments on the other. The -Federal Treasury has derived its revenue almost entirely from indirect -taxes--excise and customs--while the other governments have depended -chiefly upon direct taxes upon persons, property, business, -corporations, and inheritances. The division rests upon the -constitutional allotment of powers, but it also corresponds very -closely to the industrial and political functions of each in their -relations to the individual citizens. The chief duty of the Federal -Government is that of national defense and foreign intercourse, -relations which are national in extent but which affect the individual -only remotely; so, too, its taxing area is national and its exactions -are felt only distantly. Few persons, it has been said, taste the tax -in their tea or their whisky, yet over one-third of all the taxes -collected in the United States are derived from either customs or -excise duties. Whisky and tobacco contribute most of the internal -revenue, while import duties are levied on practically everything -brought into the country which could compete with any home product. -These two sources yield over $500,000,000 a year to the Federal -Treasury. During the Civil War these sources of revenue were -supplemented by a federal income tax, but as such a tax was later -declared unconstitutional by the Supreme Court, further recourse to 158 -this in the near future seems improbable. From a purely economic and -financial point of view this is very regrettable, for the Federal -Government should unquestionably have at its command the means of -quickly raising large additional revenue with as little disturbance to -industry as possible. Such a means would be afforded by the income -tax, which moreover can be administered only by the Federal -Government, as it must be national in its operations to be fair. - -The main reliance of the state and local governments in this country -is the general property tax, which amounted in 1902 to over -$700,000,000 or almost half of all the taxes collected. This really -consists of two very distinct parts, which present quite different -problems, namely, the tax on real property and that on personal -property. Under our peculiar system, by which property is assessed -locally, and upon the basis of that assessment its share of the state -taxes distributed to each locality, there is every incentive offered -to the local assessor to under-value the land in his jurisdiction, -thereby escaping part of the state burdens. This evil of inequality -between localities could be obviated by the simple expedient of -relieving real estate of all state taxes and leaving it solely to the -counties and cities for purposes of taxation. In the case of personal -property the great evil is evasion. Much of our modern wealth exists -in the form of securities, stocks, bonds, mortgages, etc., and this is -practically undiscoverable by assessors except by the voluntary -declaration of the tax-payer, which is only truthfully made by -trustees and a few conscientious persons. Most of our laws have been -directed to the discovery of this intangible property, as it is -called, but without avail. In a few of the most progressive states the -effort has at last been recognized as futile, and the attempt is now -being made to reach these sources of income indirectly, by taxes on -corporations, on business, franchises and other tangible evidences of -wealth. - -Not only are corporation, business, license and similar taxes being 159 -developed, but increasing resort is had to inheritance taxes, over -thirty states now making use of this form of taxation. They are more -frequently imposed on collateral than direct inheritances, and in many -states are progressive, both as to amount and as to nearness of -relationship. Thus in Wisconsin the rates advance from one per cent -for bequests under $25,000 to husband, wife, or lineal relation, to 15 -per cent for sums over $500,000 to very distant relatives or -strangers. These various forms of taxation are necessary to secure the -needed revenues for the state governments, especially if these forego -further resort to taxation of realty. The tendency is now sufficiently -marked to make it possible to indicate with some certainty the future -of taxation in this country. To a certain extent, however, this must -be regarded as the expression of an ideal rather than the description -of an existing system. The Federal Government should have customs and -excise duties, supplemented by an income tax. The state governments -should have corporation and inheritance taxes. The cities and minor -civil divisions should have taxes on realty, and license and franchise -taxes. Such a division is logical and avoids duplication of taxation -of the same source by two or more grades of government. In view of the -pre-emption of the field of corporation taxation by the states, it is -therefore doubly regrettable that the Federal Government should now -(August, 1909) have adopted a tax on income of corporations for -federal purposes. - -Other problems connected with finance are suggested in connection with -the universal tendency to increase in governmental expenditures and in -public debts. The former is an expression of the growth and expansion -of state functions, which will be discussed in the next section. The -latter is due in part to this same fact, in part also to the -development of credit and the creation of a market for the sale of 160 -public and other securities, and finally to the growth of -constitutional government, which has made the people willing to -entrust their capital to a government which they themselves as -citizens really control. - -The question of the tariff involves such important economic as well as -financial consideration that it seems best to discuss this form of -taxation somewhat more fully. For it has been used not merely as a -means of raising revenue but also as an instrument to develop -particular industries and prevent foreign competition. Any detailed -discussion of this subject therefore involves a statement of the pros -and cons of protection and free trade. It should be said, however, in -advance that the real issue is not free trade, for that is demanded by -only a few doctrinaires, but freer trade through an intelligent -revision of the tariff downward. The system of protection has -prevailed in the United States for virtually one hundred years, and -could not be suddenly changed and abolished if one would. From the -financial standpoint, too, import duties are absolutely essential to -the support of our Federal Government; the question here is not -absolutely free trade, but the choice of articles for revenue -purposes. Shall they be those which are not produced in this country -or those which enter into competition with domestic products? If -financial considerations alone prevailed, the former would undoubtedly -be selected as the more convenient, certain, and economical. But in -the determination of the tariff policies of the United States economic -considerations have been paramount and to an examination of these we -must now turn. - -Historically the following arguments have played the main role in -support of protection at different times in the United States. The -infant industries argument was advanced by Hamilton in his celebrated -Report on Manufactures in 1791 and has always been important until -recently when the infants had grown to be so lusty that it was evident -that other reasons for protecting them must be discovered. This was 161 -found in the plea for diversified production, which was necessary for -a well-rounded economic development; the need of creating a strong -national government and national spirit also played their part. In -order to win over the farmers the home market argument was early -urged; this has taken various forms. In the first place it was urged -that the building up of manufacturing centers and the consequent -increase in population would give the farmers a better market than the -fluctuating foreign one. As set forth by Carey, it would keep within -the country the elements taken from the soil. It would also save the -freights on the transportation of goods back and forth across the -ocean. Each of these arguments has lost force with the development of -the country and the decrease in the cost of transportation. More -important today is the wages argument; at first protection was urged -because wages were high in the United States and the manufacturer -needed to be protected against his foreign competitor who employed -cheap labor. Today it is argued that protection has raised wages and -must be continued in order to protect the laborer against the pauper -labor of Europe. Curiously enough, in France protection is urged for -French workmen against the highly paid and efficient American. The -effect of the tariff on wages has been greatly exaggerated; wages are -high in the United States because the productivity of labor is high. -Indeed so far as the tariff raises prices it may be argued that the -real wages of labor are lowered. More generally accepted as defensible -grounds for protection are the political arguments that a nation -should be able to produce its own military armaments and supplies, and -that it should be able to use the tariff as a retaliatory measure. -Recently this latter has received considerable force from the practice -of “dumping,” by which is meant the occasional sale of products abroad -at prices lower than those charged at home. Domestic manufacturers in -the country thus treated are of course seriously injured and have 162 -insisted upon protection against this procedure which has been -authorized in Canada. - -In answer to these various arguments the free traders, or those -desiring a modification of present high rates, make their main appeal -to the doctrine of comparative costs. Briefly stated this asserts that -nations, like individuals, can do some things better than others. Like -the individual lawyer therefore who pays to have his boots blacked -while he devotes himself to the law, the nation should produce the -things it is best fitted for and pay others to produce other things -which it can do less well. In this way each will obtain the largest -possible return. Protection, which interferes with this natural -international division of labor, simply diverts labor and capital from -more into less profitable industries. Practically, this purely -abstract economic argument has had little influence on the commercial -policy of nations, which have been moved more by political and -industrial considerations. Today, however, there is no question but -that the freer movement of capital and industry throughout the world -would be advantageous. In answer to the home market argument it is -pointed out that with the growth of large-scale production the -profitable area of manufacture has greatly widened and now in many -cases transcends national boundaries. As home producers seek foreign -markets, as they are beginning to do, they themselves will demand a -reduction of the tariff, especially in the matter of raw materials. -Free traders also deny the need of artificially diversifying industry -in a country as large and varied as the United States, or of building -up infant industries. Indeed, on the latter point, they urge that many -of our trusts are the result of the tariff, and that the attempt to -grant legislative favors has resulted only in wholesale demoralization -and a debauching of our national politics. - -In conclusion it may be said that under certain conditions the 163 -policy of protection is relatively defensible; that it has undoubtedly -hastened the industrial development of the United States, though it -has not caused it; and that, on the other hand, it is responsible for -not a few evils in our political and industrial life. The struggle of -particular interests during the framing of the Payne bill shows the -impossibility of deciding this issue upon academic grounds. It may be -prophesied, however, that as our manufacturers reach out more -seriously after the foreign markets the tariff will be modified so as -to make this possible; but he would be a rash prophet who should -predict a sudden or great change in our tariff policy within the -present generation. - - - - -XVIII. THE FUNCTIONS OF GOVERNMENT. - - -In the course of the preceding pages we have repeatedly referred to -the necessity or desirability of governmental action, and have -emphasized the important part which it plays in our economic life -today. Every practical economic problem that confronts us calls in -some degree for the exercise of state activity. It is necessary for us -then, if we are to render sound judgment on these questions, to have a -clear opinion as to the proper sphere of government action, as to how -far the State should interfere in the economic activities of private -individuals. We cannot do better than to state first the main -functions of a modern state. The modern industrial system, as we saw -in the first section, is based upon certain fundamental -institutions--personal liberty, competition, and private property. The -first function of government is to guarantee to every individual the -rights of freedom, property, and contract; this involves the -maintenance of peace and order. These are often spoken of as “natural -rights”; rather they are rational rights, based upon expediency and -human welfare, and are created and maintained by society. Without the -constant support and intervention of government they would possess 164 -little reality or significance. But in addition to guaranteeing these -fundamental institutions, modern governments grant individuals certain -privileges, as patents, copyrights, trade-marks, franchises, etc., -designed to stimulate the economic activity of individuals. - -A second group of functions undertaken by the modern state is -regulative. As we have seen, laws are made regulating the freedom of -contract, the conditions of labor, the conduct of business, methods of -banking and transportation, etc. The terms under which competitive -business may be conducted are laid down, and while freedom of industry -prevails for every individual it is only on condition that he conforms -to the rules of the game thus prescribed. But the conditions are not -merely restrictive; sometimes they are designed to promote enterprise, -as in the case of gifts, subsidies, protective duties, etc. In all -these ways the State interferes with the action of perfectly free -competition for the purpose of securing better or more equitable -conditions. A third group of functions embraces the direct -participation in industry by the Government itself, as the -post-office, gas, electric, and water works, canals, roads, sewers, -parks, etc. In other countries, when the functions of government are -more extended than in the United States, it conducts railroads, -telegraph and telephone systems, tenements, pawn shops, theaters, -industrial insurance, or various other activities. The line which -divides public from private enterprise varies greatly in different -countries. - -This raises the general question, how far is it desirable that the -economic functions of government should extend? As to the necessity of -state activity in some form there can be no doubt. Production, -exchange, distribution, and to a smaller extent consumption, are all -social processes; they concern the whole of society, and must be -brought under social control. Montesquieu laid down the proposition -in the middle of the eighteenth century that taxes invariably 165 -increase with the growth of liberty. Historically this has been -verified: the development of freedom in government and industry has -meant the realization of self-restraint by the imposition of -regulative law. But the modern State has gone further than this: it -has realized the necessity of taking an active part in modern -industrial life, for the equalization of the terms of competition, the -redress of grievances, and the furnishing of utilities, either because -it could do it better or because it was the only agency capable of -acting. The standpoint of this treatise has been one of moderate -individualism, believing in free competition and individual -initiative, but not frightened off by the bogey of socialism, if at -any point the interference of government seemed desirable or -necessary. To present the matter clearly it will be well to state -briefly the main theories that have been held as to the proper -function of government, arranging them in their logical, though not in -their historical, order. - -At one extreme stands anarchism, which must be thought of not as -anarchy and riot, but as a philosophical theory of society. Scientific -anarchism contemplates an ideal state of perfect freedom, in which the -State, the coercive exercise of authority by man over man, would not -exist. According to this theory only the individual has rights; there -is no more divinity of right in a majority than there is in kings. -Government is an invasion of the right of the individual to do as he -will, and should be abolished; with its abolition would vanish the -various moral, social, and industrial evils to which it has given -rise, and human society would develop on a higher plane. Stated in its -extreme form anarchism is evidently too ideal for frail human nature -as at present constituted. Of more practical importance has been the -theory of extreme individualism as set forth by Herbert Spencer--a -view designated by Huxley as the night-watchman theory of the State. -According to this the functions of government should be limited to 166 -the protection of life and property and the enforcement of contracts, -but should not include such things as education, regulation of -industry, local improvements, charities, coinage, etc. Private -initiative and competition are trusted to supply these things, while -the economic harmony of the interests of each individual with those of -society will prevent any wrong from being done. The keynote of the -whole theory lies in the view that government is an evil, though a -necessary one, and should consequently be restricted. Adam Smith’s -system of “national liberty” went somewhat further, as it added to the -three functions named above, the construction of public works and -buildings, etc.; but it excluded such activities as education and the -civil courts, which we regard as most suited to government management. -This theory had its origin in the reaction against the undue -interference with industry by the Government under mercantilism and -had thus a historic justification and value. - -The theory most generally held by economists and writers in the United -States is probably the modified individualism set forth by John Stuart -Mill. According to him, freedom of industry or “laissez faire should -be the general practice; every departure from it, unless required by -some great good, is a certain evil.” Industry, he said, should be left -to individuals and the Government should never interfere unless there -is an antagonism between social and private interests. Individuals -following their own interests will always conduct business better than -the Government, which is inefficient, corrupt, and can fall back on -taxation to cover its mistakes. Individualism should therefore be the -rule and governmental action the exception. But Mill himself admitted -that there was no theoretical limit to the extension of governmental -functions, and in so doing is said to have opened the door to -socialism. Nevertheless, the basic idea is still that government is -an evil and an extension of its activities is on the whole undesirable. 167 - -Opposed to this view is the culture state theory, enunciated by -Roscher and very generally held in Germany, which regards the State as -a beneficent, positive and constructive force in our industrial life. -The advocates of this theory point out that the functions of the -Government change with progress, and that in our complex modern -industrial life it should seek to improve conditions positively, and -not leave the people to the mercies of a blind competitive struggle; -practically, it should regulate industry, conditions of work, housing, -etc., and should manage all public utilities which affect the life or -well-being of the citizens, as railroads, telegraphs, industrial -insurance, etc. Still further in the same direction goes the view -known as state socialism, of whom the best-known advocate is Professor -Wagner. This advocates individualism, but insists that it is -responsible for many injustices and evils, which it is consequently -the duty of the State to redress. For instance, the State should -correct the inequalities of wealth brought about by the distribution -of the social income under the present competitive system; this should -be done by the progressive taxation of inheritances and incomes, the -limitation of inheritance and bequest, the government ownership of -public utilities, as railroads, telegraph, telephone, coal mines, etc. -This theory stops just short of socialism, but enlarges the functions -of the State to the largest degree compatible with individualism. -Beyond this, and at the farthest extreme from anarchism, stands -socialism, which, however, demands a more careful examination than the -other views have received because of its present prominence. - -Socialism may be briefly defined in the words of Professor Ely[49] as -“that contemplated system of industrial society which proposes the -abolition of private property in the great material instruments of 168 -production, and the substitution therefor of collective property; and -advocates the collective management of production, together with the -distribution of social income by society, and private property in the -larger proportion of this social income.” Four features are involved -in this definition, namely, common ownership, production, -distribution, and private incomes. The cardinal and distinctive -element in socialism is the collective or social ownership of the -means of production, that is, of the land and capital. Instead of -having these owned privately as today, they would be owned by the -people as a whole, by the State, and used by them for production. -Socialists do not oppose capital, as is often said, but only the -private ownership of capital. But under such a system private business -as we know it today, individual enterprise for the sake of profit, -could not exist. It is often urged that socialism means a “grand -divide,” and that in such an event the shrewder and more thrifty would -shortly have the wealth of the idle or stupid members of society. But -just that is guarded against under socialism, for there would be no -private ownership of capital, and hence no one could get his -neighbor’s share; it would all be held under collective ownership. -With the abolition of private capital, there would disappear of course -all the economic institutions that have grown up around it, as credit, -banking, lease, hire, the stock and produce exchanges, etc. - -Socialism also means the collective or social organization and -management of industry. Socialists criticise severely our present -methods of production, which they call planless and wasteful. They -point to the constant recurrence of crises as an evidence of mistakes -of the competitive system, which they say could be obviated under a -well-organized comprehensive scheme. They also urge the wastes of -modern capitalism, in the duplication of plants, advertising (which -amounts to $500,000,000 a year in the United States and serves little 169 -useful purpose), traveling salesmen, multiplication of small stores, -etc. Finally, an artificial disharmony between the interests of -society and private individuals is promoted by our system of private -property and profit: a coal trust limits the supply, farmers rejoice -over small crops, and planters burn part of their cotton, in short the -bounty of nature is regarded as a calamity. Some truth may be admitted -in these criticisms, but in answer it may be said that some of them -are being corrected under individualism, while as to those that remain -the remedy offered is worse than the disease. The first and -fundamental question is the effect of socialism on the amount -produced, for as we have seen any diminution would mean a worse -economic condition of society, even though it were offset by a more -equal distribution. Under individualism the appeal to industry and -thrift is the self-interest of the individual, and under the stimulus -of this motive the production of wealth has been increased enormously. -It is doubtful whether the motives of altruism, desire for social -approbation, and similar ones suggested by the socialists would -promote industrial activity as efficiently as the individualistic -desire for pecuniary gain. - -Moreover the difficulties of organizing and managing all industries -would be enormous. According to the socialist plan, statistics of -consumption would be gathered in advance, the idle changes of fashion -would of course disappear, and production could be accurately -calculated. But aside from the problem of securing an honest and -efficient administration, the work of organizing industry from a -centralized bureau would probably prove insurmountable. The -distribution of the labor force among various employments suggests -another difficulty. Under individualism the necessary distribution -takes place through the agency of wage payments and the choice of an -occupation is left free to the individual. As the wage-system would -disappear with the abolition of private capital, some other means 170 -would have to be devised, as allotment by the Government. But more -important would be the selection of the managers of industry; -competition provides a process whereby the inefficient are eliminated -and the able put in charge. As socialism would be an industrial -democracy the selection of the captains of industry under that system -would probably be made by election. Is it likely that the voters would -place over themselves the ablest, that is the strictest, most -economical, and most energetic man? Taking men as we find them today, -this may well be doubted. - -But it is as a scheme of distribution that socialism has been most -warmly urged. The inequalities and injustices of present methods are -pointed out and a more just system demanded. Socialists themselves, -however, are not agreed as to what constitutes justice. Needs and -merits have both been urged as bases of distribution, but suffer from -vagueness and difficulty in administration; most socialists today -agree that equality of income would best meet the requirements of -justice. They claim that talented persons have been endowed by nature -with their abilities and should use them as a trust for society and -not expect greater rewards than their less talented brothers. To this -individualists answer that the practical question is, how to secure -the greatest exercise of these gifts, and that is now done by -appealing to the motive of self-interest. Some writers even go further -and assert that the desire for inequality is the chief stimulus to -invention and enterprise. A crucial point in every socialistic scheme -is the determination of value under such a system; most socialists -follow Marx and say that this should be determined by the “socially -necessary labor time” required for the production of an article. Such -a measure leaves out of account entirely the aspect of utility or -demand, and would clearly be inadequate. Prices would be fixed by the -State and would be calculated in labor time, which would probably be 171 -represented by labor checks, which would constitute the media of -exchange of the socialistic society. - -Finally, in the definition given above, it was stated that private -property would exist in the larger proportion of the social income -after it was divided. There is no reason why this should not be true, -for, though private capital would be abolished, the State would not -interfere with the individual in the use of his income after it was -earned. If one man preferred fine clothes and another pictures and -books, it would be possible for the latter person to accumulate such -articles of enjoyment or consumption. He could even have tools for -private carpentering or a horse for riding, but under no circumstances -would he be permitted to use these for production or as instruments of -private gain. Socialism must stand or fall as a system of production -and distribution; it is not necessary to criticise minor points. On -these broad grounds it must be rejected, although it may fairly be -admitted that socialists have often proved themselves keen and useful -critics of existing institutions. - -Many persons in this and other countries, who do not approve of -socialism, nevertheless believe in the extension of state ownership or -activity along particular lines. Thus Henry George, though in other -respects an individualist, did not believe in the private ownership of -land. Land is limited in quantity and yields, because of its monopoly -character, an “unearned increment” or rent, quite apart from the -return due the owner for improvements. He proposed that the Government -should confiscate this unearned increment by levying a single tax on -all land equal to it. He thought that this would provide revenue -sufficient for all government needs without resorting to other forms -of taxation; in this he was undoubtedly mistaken, but the main -interest in the scheme for us is economic, and not financial. The -reason for the scheme was that land, being a limited monopoly, would -be increasingly in demand as society progressed, and that consequently 172 -the landlords would absorb in their increased rents most of the -enlarged production of the future. This assumes that rents always -increase and never decrease, which is historically untrue. Nor does -the growth and progress of society necessarily increase the demand for -land; it may be directed to other things, while improvements in the -arts of agriculture may actually decrease this demand. We must, -however, admit that there are many instances of unearned increments, -not only in the case of ground rents, but also of monopoly profits -from various sources; these might very properly be secured to society -by means of special and heavy taxes. - -The municipalization of local public utilities has been advocated by -many persons who are not socialists, except in so far as they desire -an extension of governmental activity along these lines. They urge -this because the utilities in question--gas, water, electricity, -telephone, street railways, etc.--are by their very nature monopolies, -and because under private control they are often inefficiently or -dishonestly managed. A less drastic remedy for these abuses might of -course be found in regulation. Unrestricted private control of -municipal monopolies is advocated by few; the real issue is between -public regulation and public management. And this issue will depend in -the last analysis upon the question which can give the best results to -society. - - - - -XIX. ECONOMIC PROGRESS. - - -At the conclusion of a study of this character we are inevitably led -to summarize our conclusions and to try to answer the question as to -what the lessons of the past have taught us. In what direction are the -forces of economic life taking us? The conclusion of this text is that -they are making for economic progress, and it will be worth while to -justify as far as possible this belief. It is, however, impossible 173 -to do this except in very general terms, for definite data for -measuring this improvement do not exist, and economic progress itself -is a somewhat vague conception. Even such comparatively simple facts -as the rate of wages or the hours of labor can be stated only very -generally. But both of these show a decided improvement in the -condition of the working class. A careful investigation for Great -Britain by Mr. A. L. Bowley[50] shows that if wages for the decade -1890-1900 be represented as 100 then the course of wages during the -nineteenth century would have run somewhat as follows: - - =========+================++===========+=============== - Decade | Relative Wages || Decade | Relative Wages - ---------+----------------++-----------+--------------- - 1800-10 | 55-65 || 1850-60 | 65 - 1810-20 | 65-70 || 1860-70 | 75 - 1820-30 | 65 || 1870-80 | 95 - 1830-40 | 60 || 1880-90 | 90 - 1840-50 | 60 || 1890-1900 | 100 - ---------+----------------++-----------+--------------- - -Without investigating the validity of the figures too closely, it may -safely be affirmed that the movement of wages has been distinctly -upward, and that the rise was certainly not less than 50 per cent. For -the United States the increase has not been so great, probably because -wages started at a higher level. According to the Aldrich report, if -wages and prices in 1860 in the United States be taken as 100, -relative wages in 1840 were 82.5 and relative prices 98.5; in 1880, -they were respectively 143 and 103.4; in 1903, they were 187 and 103. -That is to say, relative wages showed a marked advance and real wages, -owing to the fact that general prices remained almost stationary, an -even greater improvement. So, too, the hours of labor appear to have -been shortened in Great Britain about two hours a day (from 10 to 14 -hours to 8 to 12), and in the United States probably as much, the -average length of the working day in certain employments decreasing 174 -from 10.3 hours in 1880 to 9.6 hours in 1903. - -In the field of production the most dramatic and striking advances -have been achieved. The application of steam and more recently of -electricity as the motive power for the newly invented and constantly -improved machinery has permitted an enormous expansion of production, -which has been made still greater by the opening up of new mines and -new lands and improvements in the machinery of transportation and -exchange and in the organization of business. Especially in the United -States where the natural resources were especially rich and the people -energetic and ingenious, has the growth of wealth been marvelous. And -yet almost a century after the beginning of the Industrial Revolution -in England, Mill alleged that labor-saving inventions had not -lightened the toil of any human being; they have only enabled a -greater number to live the same life of drudgery and imprisonment. -What answer can we make to this indictment today? Why is it that the -working class still has so little of this vast increase of wealth and -still lives so close to the border line of poverty? - -To answer this question thoroughly would require an analysis of the -subject of distribution, but a few reasons may be briefly -suggested.[51] While the social income has been greatly increased by -these improvements the amount paid in rent to owners of land, water -powers, etc., has also grown. If we approve of private property in -land as best adapted to stimulate its use for society, then we must -admit the justice of rent, and of its payment to present land owners. -Similarly, too, the payment of interest to the owners of capital has -absorbed a large part of the increased income of society, though the -proportion going to this factor is probably growing smaller owing to -the fall in the rate of interest. But as we have seen, modern industry -is essentially capitalistic, that is, it depends upon the use of 175 -capital for its operations. Since we allow private property in capital -and believe that to be the best method yet devised for securing its -accumulation, we must justify interest. Profits in general are fairly -earned by industrial organizers and others who manage our businesses, -and are necessary to enlist their services. Probably in most cases -society does not overpay these leaders of industry. But some forms of -profit, as those derived solely from monopoly, especially from the -monopoly of limited natural resources, are both too large and socially -unearned. These society should clearly control and absorb. - -One reason then why labor has not profited more by the great increase -in wealth is that the other factors in production have laid claim to -their shares also. There is good reason for believing, however, that -the share of labor has been steadily growing greater all the time, and -that it today gets a larger proportion of the social income than ever -before. This fact is obscured by the great growth in population, which -has more than doubled in the last hundred years in Europe and has -shown a twentyfold increase in the United States. The larger income is -divided among more people, and though each today gets more than his -grandfather, there is not yet enough produced to make all rich. -Indeed, if the wealth of the United States were divided equally, it -would not provide a competence for anybody. The difficulty is not -merely that there is inequality in distribution, but that the need of -a much greater production of wealth must also be met. Inequalities may -be adjusted by such measures as progressive inheritance taxes, but -resort to this or similar methods must not be so severe as to weaken -the motives for the accumulation of capital. That must form one of the -strongest reasons for rejecting the drastic proposals of socialism. - -Improvements in production have, however, not merely increased the -total output; they have greatly reduced the cost of many articles 176 -and have brought within the reach of the poorest consumers others -which a century ago would have been unattainable. Improvements in -transportation have served to bring an ever-increasing variety of -products to market. The material progress of a people can be gaged -fairly well by their consumption of certain semi-luxuries, such as -tea, coffee, sugar, tobacco, beer, etc.; these show a steady increase -during the past century. “Thus in the United States between 1871 and -1903 inclusive, the per capita consumption of coffee increased from -7.91 to 10.79 pounds, that of sugar from 36.2 pounds to 71.1 pounds, -that of malt liquors from 6.1 gallons to 18.04 gallons, that of wheat -and flour from 4.69 bushels to 5.81 bushels.”[52] A similar -investigation for Great Britain shows an average increase in a -considerably larger list of the same character of 40 per cent between -1860-64 and 1895-96. It must be admitted that there is much lack of -economy in present consumption; there is often wasteful and positively -injurious consumption, an illustration of which would be found by many -persons in the increased consumption of malt liquors cited above. From -a purely economic standpoint the enormous waste of war and the -burdensome cost of military and naval armament must also be condemned. - -The task of prophecy is usually a fruitless one, but at least it is -now possible for us to indicate some of the lines along which reform -is needed, and the goal towards which the future of progress will -probably move. The natural resources of the nation must be more -carefully conserved and reckless destruction prevented; at the same -time the monopolization of limited resources by private individuals or -corporations must be rigidly restricted. The growth of trusts seems -but the last step in a steady growth in size of the business unit and -may be accepted as an economical method of industrial organization, -but the evils of corporate financial management must be carefully -guarded against. The growth of labor organizations, on the other 177 -hand, must be admitted to be equally logical and desirable. While they -often display monopolistic tendencies, yet our main reliance must be -placed upon these agencies to secure bargains for laborers on terms of -equality with their employers. But on behalf of wage-earners not -easily organized we must resort to state interference by means of -factory and labor legislation in order to secure equitable labor -contracts. Free competition which exposes women and children to the -greed of unscrupulous employers is defended by no one today, and it is -clearly recognized that legislation along these lines must be further -extended, as for instance in the direction of industrial insurance, -old age pensions, adequate care for the unemployable, etc. - -Reforms in our banking and currency laws, an extension of banking -facilities to the working classes, the more careful regulation of -railroad rates, reforms in methods of taxation, and a reduction in the -tariff--all are called for by the development and readjustment of -industry. On the other hand, much remains to be done in the education -of the mass of the people to habits of rational living and enjoyment. -In the great cities housing conditions should be effectively -regulated, sweatshops suppressed, intemperance discouraged, and where -possible a love of art and outdoor life promoted. A more rational use -of income would increase the material well-being of the people -considerably. Problems of distribution are still more insistent. No -one who has the welfare of the laboring classes or of our democratic -society at heart can view with approval the existence of widely -separated classes, with disproportionate political and economic power. -Greater equality in fortunes--a leveling up of incomes--must certainly -be regarded as a sound social ideal. On the other hand, we have seen -reason to reject the drastic remedies of socialism as a cure for the -injustices of present methods of distribution or production. -Improvement must come by conservative reform along the lines of our 178 -past development. In the last analysis all attempts to improve -conditions permanently depend upon the character and capacity of the -individual. Because of this fact education assumes great -importance--education not merely in the art of production but also in -that supreme art, the art of living. - - - [1] Tarr, Economic Geology of the U. S., pp. 7, 119. - - [2] In Quarterly Journal of Economics, Vol. XIX, p. 3. - - [3] McVey, Modern Industrialism, p. 145. - - [4] The Truth About the Trusts, p. 469. - - [5] Tetter, Principles of Economics, p. 321. - - [6] Bogart, Economic History of the U. S., p. 412. - - [7] XIX, 645. - - [8] Seager, Introduction to Economics, 176. - - [9] Evolution of Modern Capitalism, 35. - - [10] Economics, 121. - - [11] F. J. Stimson, Labor in its Relation to Law, 51. - - [12] Bullock, Introduction to the Study of Economics, 428. - - [13] Stimson, op. cit., 71. - - [14] A. H. Ruegg, Law of Employer & Workman in England, 99. - - [15] Rep. of U. S. Ind. Com., XVII. 1. - - [16] Rep. Ind. Com., XVII, xlii. - - [17] E. L. Bogart, The Chicago Building Trades Dispute, in Pol. Sci. - Quart., XVI., 134; also in Commons, Trade Unionism & Labor - Problems, p. 107. - - [18] Bogart, op. cit., p. 137. - - [19] Economics, 353. - - [20] Political Economy, 381. - - [21] Evolution of Modern Capitalism, 297. - - [22] Wealth & Progress, 171. - - [23] Report Industrial Commission, XIX, 926. - - [24] Getting a Living, 475. - - [25] Report Industrial Commission, XIX, 746. - - [26] Ind. Com., Rep: XIX, 757. - - [27] Bull. of U. S. Bur. of Lab., Sept., 1908, p. 418. - - [28] Economics, 337. - - [29] Industrial Evolution of the United States, ch. 28. - - [30] Evol. of Mod. Cap., 229. - - [31] The Effects of Machinery on Wages, 65. - - [32] Principles of Economics, I, 315. - - [33] Industrial Efficiency, II, 451. - - [34] Schloss, Methods of Industrial Remuneration, 305. - - [35] Report, VII, 644. - - [36] Economics, 377. - - [37] Political Economy, 344, 345. - - [38] Economics, 133. - - [39] Bliss, Encyclopedia of Social Reform, art. Distribution, p. 501. - - [40] Economics, 360. - - [41] Stated technically, its marginal productivity is small and - hence its reward is also small. - - [42] More truly, the marginal productivity theory. - - [43] J. R Commons, the Distribution of Wealth, 252. - - [44] More, Wage-earners’ Budgets, 269. - - [45] Today the loss is probably double this sum. - - [46] Gide, Political Economy, Rev. Ed., 663. - - [47] Seager, Introduction to Economics, 73. - - [48] Bullock, Introduction to Study of Economics, 106. - - [49] Socialism and Social Reform, 19. - - [50] Wages in the United Kingdom in the Nineteenth Century. - - [51] Acknowledgment should be made at this point of indebtedness - to the excellent final chapter in Prof. H. R. Seager’s - Introduction to Economics. - - [52] Adams and Sumner, Labor Problems, 523. - - - - - - -MANUFACTURING. 179 - -BY O. P. AUSTIN. - -[Chief of Bureau of Statistics, Department of Commerce and Labor. -Native of Illinois. Engaged in newspaper work on arriving at manhood, -and so continued in Chicago, Cincinnati and Washington, as reporter, -editor and Washington correspondent, until appointed Chief of the -Bureau of Statistics in 1898. Author of many official monographs, -including: “Commercial Orient,” “Commercial Porto Rico, Hawaii and -Philippine Islands,” “Commercial Alaska,” “American Commerce,” -“Submarine and Land Telegraphs of the World,” “Transportation Routes -and Systems of the World,” “National Debts of the World,” “Great -Canals of the World,” “Colonies of the World and Their Government,” -“Colonial Administration,” “Territorial Expansion of the United -States,” etc., etc. Also author of publications for instruction of -youth in national and international affairs. Member of American -Academy of Political and Social Science, American Association of -Geographers, American Economic Association, International Union for -Comparative Jurisprudence and Political Economy, Central Statistical -Commission of Belgium, Associate Editor National Geographic Magazine; -Lecturer.] - - - - -INTRODUCTION. - - -The production of manufactures for the requirements of the world’s -population is conducted in a comparatively small section of its land -surface. Just as the manager of a great estate devotes one section of -his estate to the production of certain articles, and other sections -to certain other articles, so the great business instinct which rules -the business of the world carries on in its various sections the -varied industries best suited to the physical, ethnological and -financial conditions of its various sections. - -The people of western Europe and eastern United States are, for -various reasons better able to produce the manufactures required by -the world than are those of South America, Africa or the Orient; -while, on the other hand, the people of South America, the Orient, -Australia, Canada, the western part of the United States or the -eastern part of Europe are better able, for various reasons, to -produce the raw materials of manufacturing and the food supplies -required by those engaged in the manufacturing industry than are the -people of western Europe or eastern United States. South America and -Australia produce wool in large quantities; Africa and the Amazon -Valley produce the chief supply of india rubber; the Malayan peninsula -and adjacent islands produce the bulk of the world’s tin; India -produces jute; the Philippines, Manila hemp; Mexico, sisal; China and 180 -Japan, the bulk of the world’s silk; Egypt, India and the United -States, the world’s cotton; Russia, Austria-Hungary, India, -Australasia, South America, Canada, the central and western parts of -the United States produce the bulk of the world’s wheat, corn and -meats, at least the bulk of that in excess of the requirements for -local consumption; Europe, the West Indies, the East Indies and the -tropical sections of India, China and Central and South America -produce the bulk of the world’s sugar. - -The manufacturing industries of the world--confining this term for the -moment to those industries in which the great proportion of the work -is performed by machinery--are conducted chiefly in, it might almost -be said confined to, western Europe and eastern United States. True, -the exclusive application of the word “manufactures” to that portion -of the world’s product of this character made by the use of machinery -in conjunction with large sums of capital--the factory method--carries -one beyond the original meaning of the word “manufactures,” which -primarily meant, of course, made by the hand (from manus, the hand; -and facere, to make); but the industrial habits of the world have also -passed beyond that stage in which manufacturing for the masses is -carried on by hand methods. - -It must not be understood from this that all of the world’s -manufactures are produced in western Europe and eastern United States, -or produced by modern machine methods in conjunction with the -investment of great sums of money--the factory system. On the -contrary, large quantities of manufactures are still produced by hand -in various parts of the world other than those in which manufactures -by modern machine methods are a leading characteristic of the -occupations of the people. Nor must it be assumed that the areas -designated as the non-manufacturing sections are entirely dependent -upon the manufacturing sections for their manufactures. On the -contrary, large quantities of manufactures are still produced in the 181 -Orient, in Africa, South America, Australia and the islands of the sea -by those simple processes which prevailed in Europe and the United -States prior to the development of the modern methods less than two -centuries ago. The industrious population of China, of India, of -Japan, the millions of people in Africa, in South America and in the -islands of the sea produce by simple methods large quantities, and in -many cases a large proportion, of the simple manufactures which they -require for their daily life. The cloth with which they cover their -bodies, the simple requirements of household life and of agriculture -are, in many cases, largely of their own production and made in -keeping with the original meaning of the word “manufacture”--made by -hand. - -But the statement is still true, that the great manufacturing areas of -the world--the areas which give their chief attention, or the -continuous attention of a large part of their population, to the -production of those requirements of man other than the natural -products and do this through the application of power, machinery and -capital, and the operations thereof under the factory system, are -western Europe and the eastern part of the United States, though the -systems which prevail there are gradually extending to other parts of -the world--eastern Europe, central, southern and western United -States, Japan, India, Australia, Canada and South America. - -As to the relative share of the world’s manufactures now produced by -the use of machinery, power and capital--the factory method--and by -the hand process, respectively, no exact statement can be made; nor -are there facilities for even offering an intelligent estimate of the -relative production by these two methods. There is reason to believe -that two-thirds of the cotton cloth consumed in China is still made by -the hand process, and if this be true it may be estimated that perhaps -two-thirds of the other manufactures consumed in that country are 182 -still made by hand; while in those other sections of the world in -which railroads and the other methods which the people of the Occident -are pleased to term “modern” do not yet prevail, a large proportion of -the simple manufactures of the people, are still those produced by -hand methods. The fact, however, that the sections which produce -manufactures by modern methods are also supplied with modern -facilities of transportation--the railroad and the steamship; and of -communication--the telegraph, and also supplied with ample sums of -capital and that other important quality born of long experience and -the energy supplied by a temperate zone climate and the judicious -admixture of the most energetic populations of the world--Europe and -the United States--has enabled them to distribute their factory -products in great quantities to those sections not producing by the -factory method, and whose peoples are willing to exchange their -natural products, food and raw materials, for the finished products of -the factory. - -This brings us to a consideration of the exchanges of the world--the -exchanges of natural products for the products of the factory. This -exchange, as already intimated, occurs chiefly in the requirements of -the manufacturing section--raw materials and food--for manufactures. -Western Europe, the great manufacturing section of that grand -division, does not produce cotton, jute, or a sufficient supply of -wool, silk, or hemp. For its india rubber, its tin, its copper and the -numerous articles of tropical production required for manufacturing, -it is dependent wholly or chiefly upon other parts of the world. The -United States, while producing a large share of the world’s cotton and -copper and iron, and a considerable supply of wool, must rely upon -other parts of the world for its hemp and jute and sisal and india -rubber and silk and many other of its tropical requirements. As a -result the Orient exchanges its raw silk, its jute, its Manila hemp, -its tin, and numerous less important articles, for the factory 183 -products of Europe and the United States. Australia exchanges its -wool, its meats and its gold for the products of the manufacturing -sections. Africa sends its india rubber, its ostrich feathers, its -gold and diamonds in exchange for factory products of those sections -in which the manufacturing system has developed. South America offers -as its exchangeable products wool, wheat, corn, meats, coffee and -india rubber. Canada gives in exchange for her factory requirements -timber, ores, wheat and other agricultural products. - -Thus the business intelligence that rules the world, adapting one to -another those various conditions which prevail in its varying -sections, has built up in certain sections of its great area--Europe -and the United States--a great factory system, operated by the great -supplies of power (coal) which there exist in conjunction with the -wealth, the intelligence, the climatic conditions and the quality of -population, which system, besides supplying its own six hundred -millions of people with their own requirements, sends to the other ten -hundred millions of people in other parts of the world its surplus -products and takes in exchange the natural products, the manufacturing -material and food required by its own people and its own industries. - -George J. Chisholm, in the Introduction to Bartholomew’s Atlas of the -World’s Commerce, outlines the history of the development of -manufactures and the relation thereof to commerce as follows: - - “In the latter part of the eighteenth century there took place in - England a number of inventions which have brought about a change - in the conditions of manufacturing industry and of commerce, and - an acceleration of the rate of the economic development of the - world, to which all previous history presents no parallel or - approach to a parallel. It is a change that has affected the - entire world, bringing about an entirely new trade with the New - World and the antipodes, and completely altering the character 184 - of the trade with the East, depriving spices of the peculiar - value which they held in commerce for so many centuries, and - developing a trade of incomparably greater magnitude with the - East than was at one time ever dreamt of, and largely in - commodities of a bulky character yielding comparatively little - profit on small quantities. The revolution was inaugurated by the - inventions in connection with the cotton industry between 1769 - and 1785 and the concurrent improvements in the steam engine by - James Watt, who thereby first made this a generally serviceable - machine. These were followed by the introduction of steam - locomotion by land and water in the first quarter, and the rapid - extension of these modes of transport in the remainder of the - nineteenth century. The result of these inventions was to give a - new value to the stores of coal and iron in the United Kingdom, - and ultimately a new value to undeveloped land in new countries. - It was railways that first made it possible to fill great ships - with bulky produce like grain drawn from the far interior. The - remarkable expansion of commerce thus brought about greatly - increased the commercial advantages of Great Britain due to its - situation and local facilities for shipping. In so far, however, - as the unexampled development of British manufacturing industry - and commerce in the period immediately following the Industrial - Revolution was due not to geographical conditions but merely to - the fact that the great inventions originated there and - consequently the resources of Great Britain for carrying on - manufactures by the new methods were developed first, the - expansion of British manufactures and commerce was bound to be - affected by the development of similar resources elsewhere; and - the more rapid growth of manufactures in some rival countries - resulting from this cause, and partly, it may be, from other - causes, has been one of the marked features of recent economic - history.” - - - - -I. MODERN MANUFACTURING SYSTEMS OF THE WORLD. 185 - - -The manufacturing systems of the world have developed from mere hand -and household industries to those of the machine and factory in less -than two centuries. For thousands of years the simple requirements of -men--of clothing, of domestic life, of agriculture and of -transportation--were met with articles produced by hand labor, -performed for the greatest part in the household or in simple -workshops adjacent thereto. Then, in the latter half of the eighteenth -century, man discovered that he could harness the power of the -waterfall and, by making the wheels which it turned turn other wheels, -could utilize that power in performing many tasks which he had -hitherto performed laboriously by hand. The turning wheels twisted the -wool and flax and cotton into threads stronger and finer and better -than his wife had been accustomed to twist with the spinning wheel and -distaff, and produced in a single day as much of this yarn as a -hundred industrious women could produce in a week or a fortnight. By -gearing the wheels to operate a loom he could weave the yarn into -cloth with a small fraction of the labor and time which had been -required to weave it by the hand loom and obtain better results. - -Thus arose the custom of manufacturing by machinery operated by the -power of the waterfall the cloth which had hitherto been manufactured -by hand labor in the household; this was the beginning of the modern -manufacturing industry. - -To do this, however, it was necessary to plant the machines beside the -waterfall and bring to them the raw material and the persons necessary -to operate them, for the machine was unable to perform its task unless -assisted by the intelligent labor and guidance of experienced men and -women. Thus arose the system of performing in a single workshop, with 186 -the aid of a considerable number of people and machines, the -manufacturing which had been hitherto performed by many people in many -households and with many machines of simpler form and operated by -human power--the factory system. - -This new system developed new occupations. The buildings in which the -work was carried on must be constructed. The machinery required for -operating the factory must be made and kept in repair, and new -machines made to take the place of those worn out. So there came -occupation for mechanics and skilled machinists in manufacturing and -repairing the machines, and for others skilled in operating them. The -material used in manufacturing the cloth must be transported to the -factory, instead of being used at the place where it was grown as -formerly; and the cloth must again be transported to the consumer; and -thus there were new occupations for man and beast in transportation -and in constructing and maintaining the roads over which the material -was transported. Still another, and equally important, industry -developed was that of supplying the food and other requirements of the -men and women engaged in the factory, and this gave new activity to -the agricultural industries near the factory and further occupation to -those engaged in transportation. - -To supply the wants of those employed in the factories, who were so -busily engaged that they could not find time to grow their own food, -or make their own clothing, other enterprising men and women -established themselves near the factory to sell the required food and -household supplies, to supply the fuel with which they cooked their -daily food, to buy small portions of the cloth made in the factory and -turn it into clothing to sell to the operatives, to shave their rough -beards and occasionally trim their hair--and thus arose the factory -town. - -So the factory system, which at first threatened to take away the 187 -occupation of thousands who had formerly devoted their time to making -yarn and cloth by hand labor, developed new occupations and new -industries, and brought portions of the hitherto scattered people into -groups, and these groups in time developed better accommodations for -themselves and their families in homes, in comforts of life, in -educational facilities, and in hours of labor; and in doing this they -also supplied the masses with cloth at a less cost of labor than they -had formerly expended in obtaining it. - -Meantime man was learning another important lesson, one which was to -develop even more rapidly the art of manufacturing. He found through a -long series of experiments that power could be generated by heating -water until it turned into an expansive vapor which he called steam, -and that this expansive force could be controlled in such manner as to -put in operation a machine which he called the steam engine, which -could in turn transmit its power to that machinery formerly operated -exclusively by the power of the waterfall. - -This discovery again revolutionized the manufacturing industry, which -had hitherto been limited in the scope of its operations by the supply -of water power so located that the raw material could be transported -to it and the finished products in turn transported thence to market. -With this new force, steam, by which the manufacturing machinery could -be made entirely independent of the waterfall, the factories were -located at points convenient to the natural supply of fuel and -manufacturing material or to the market for the finished products. -Where this was not practicable the factories were located at places to -which the materials could be readily and cheaply carried by water -transportation, either on some navigable stream or the sea-coast. - -Another important contribution made by steam power to the development 188 -of the manufacturing industry was the decrease in cost of -transportation. Before the development of the railway and the -steamship the material of manufacture, unless produced within a short -distance of some navigable water, canals, rivers, lakes or oceans, was -of comparatively little value. It was not always practicable to plant -the factory in the section which most readily produced the wool or -cotton or flax or hemp or silk, or to place it alongside the iron or -copper mine; and even if this were done the manufactured material was -valueless unless it could be transported to those requiring it. Even -the lighter articles of manufacture, such as wool or cotton or fibers -or silk, could not be transported any considerable distance without -greatly increasing the cost to the manufacturer, and thus -proportionately advancing the cost of the manufactured article. But -when, in the middle of the nineteenth century, the railways began to -penetrate the continents and the steamships began to cross the ocean -and extend their tours to the commercially undeveloped sections of the -world, the manufacturers found new sources of supply open to them and -quantities of raw material reaching them from distant lands at such -comparatively low cost as to enable them to enlarge their output, -increase the variety of their productions and reduce the cost of both -the necessities and conveniences and luxuries which they were offering -to the public. The railways of the world grew from 25,000 miles in -1850 to 500,000 miles in 1900 and 600,000 in 1909. The tonnage of -steam vessels on the navigable waters of the world grew from less than -one million tons in 1850 to 24 million in 1909; and the carrying power -of the sail and steam vessels of the world, measured in sail tons, -grew from 15 million tons in 1850 to 100 million in 1909. The general -reduction in freight rates meantime is illustrated by the fact that -the price of transporting wheat from Chicago to New York by rail 189 -fell from 33½ cents per bushel in 1872 to 10 cents per bushel in -1900, and the charge for transporting wheat from New York to Liverpool -fell from 17 cents per bushel in 1875 to 3 cents per bushel in 1905; -and similar reductions were made in the charges for transporting -manufacturers’ materials. - -Thus the application of steam to manufacturing and transportation -multiplied the power of production. The area over which it could be -performed was greatly enlarged, the cost of materials was reduced -through cheaper transportation, new devices and processes were -developed as a result of the competition, cheaper raw material was -obtained from countries where plentiful supplies and cheap labor give -low prices, and the opportunity of locating the factory near the place -of production or at some convenient meeting point between the various -places of production--all these contributed to reduction of cost and -increase of supplies of material of manufacture. The great iron and -steel works of western Pennsylvania, and northern Ohio, Indiana and -Illinois, for example, are located not at the iron mines or the coal -fields, but at places between these two fields to which these -materials can be cheaply carried from their respective places of -production. The iron ore is chiefly produced in the Lake Superior -region and carried at a very low cost by vessels especially -constructed for this purpose to the southern shores of Lake Erie. The -coal is chiefly produced in western Pennsylvania and central Ohio, -Indiana and Illinois. The cost of transporting the coal from the mine -to the lake shore, or the ore from the lake shore to the mine, or both -coal and ore to some mutually convenient meeting point by river or -canal or railroads constructed for this purpose across a comparatively -level country, is extremely small, less in many cases than that of -carrying material to the waterfall which is not infrequently located -at places difficult of access. The vessels carrying the manufactures -of the United States or the manufacturing countries of Europe to 190 -South America, Africa and the Orient, bring back at a very low cost -the india rubber, the tin, the fibers, the wool, the silk, the -Egyptian cotton of those distant countries; and the manufacturer who a -century ago was limited in his supply of raw materials to the -immediate vicinity of his factory may now bring his material from all -parts of the world, while the area in which he may sell his products -has been correspondingly enlarged. - -One very recent contribution to the convenience and cheapness of -manufacture is found in the transmission of power in the form of -electricity. Formerly the machines of the factory were operated by -power obtained from the steam engine or the water wheel through lines -of shafting, gearing, belts, friction pulleys, etc. This made it -necessary that the factory operated by water power be placed alongside -the waterfall, or at least within a comparatively short distance of -the source of power. Recent inventions have made it possible to -transform power into electricity, carry that electricity hundreds of -miles on a wire, and transform it back into power for the operation of -the machinery of the factory or the transportation of the raw material -or the finished product. This has increased greatly the value of the -world’s water power in its relation to manufacturing. Formerly only a -small part of the waterfalls of the world were used at all, largely -because of their comparative inaccessibility and the cost of -transporting the raw material to them and the finished product from -them. Now that power, generated at any point, however inaccessible for -freight handling, may be transmitted in the form of electricity on a -simple piece of wire to any convenient point within a hundred or even -two hundred miles of the place of production, and by a simple process -applied to the operations of machines small or large, simple or -complex, the possibilities of the waterfall in supplying power for the -manufacturer are greatly enlarged. - -Not only is this true of the waterfalls now in existence but of those 191 -which may be brought into existence, for now that man has found a way -to use the power thus generated he may readily increase the number of -waterfalls by constructing dams at many places, and using the water -over and over again in its flow from the place of origin to the ocean -level. The great quantities of water stored up in the form of snow and -ice in the mountain ranges of the world, and gradually liberated by -melting may supply almost untold quantities of power as they flow down -the mountain sides used not merely once but many times. The -manufacturing power of Italy, Switzerland and southern France is now -being greatly augmented by this process. - -Another possibility of the use of this new distributor of power, -electricity, is the multiplying of workshops and the return in some -instances and certain articles to household or small shop manufacture. -It is now so easy to introduce the electric wire and a small electric -motor into the household or the shop adjoining the household and to so -operate small machines for the various processes in many of the -manufacturing industries, that this new use of electricity for the -transmission of power is already making visible changes in the factory -systems of the world, and promises still greater changes. In many -lines of manufacture in which the machinery occupies small space and -requires little power and the quantity of material handled is not -great, such as watch and clock making, the manufacture of clothing, -boots and shoes, toys, etc., a part or all of the work can now be -performed in the household or small shop through the power generated -miles away and brought into the workman’s home on a simple piece of -wire. - -On the other hand the use of electricity in the great factory or -manufacturing establishment is equally important. Instead of -transmitting the power of the engine to the various classes of -machinery by belts, shafting and gearing, much of it is now 192 -transmitted and applied in the form of electricity. Great cranes which -handle many tons of material are operated by the electric motor -without the intervention of the costly shafting, belting and gearing; -and the great magnet, made such by electricity, picks up its ton of -steel rails with the same ease that the toy magnet picks up the -needle, and is managed with no greater physical exertion than the -other. - -Cassier’s Magazine, an accepted authority on engineering matters, -publishes with favorable editorial comment, in its issue of September, -1909, a statement by Sylvester Stewart that “we could take out in -regions where water power is needed at least a hundred times as much -water power as is now employed, furnishing a safer and cleaner power -than steam, at a lower cost, and thus prolong the existence of our -coal fields. * * * A running stream may be compared to an endless -driving belt only awaiting connection to the machinery it is capable -of driving, but it has not been appreciated because we have become so -familiar with it; if it had suddenly been discovered, doubtless it -would have been harnessed immediately. Coal is passing away, but water -flows continuously. A hundred thousand horsepower may be taken from a -river and its place is still filled, but the coal vein once emptied is -emptied forever.” Mr. Stewart adds that probably not one-thousandth -part of the water power of the world is now utilized, and that while -the greater part of this power is not at present available, because of -its existence in out-of-the-way places, or in rivers so deep and -sluggish that the energy obtainable from them would cost more than -steam power, at least a hundred times as much water power as is now -used could be, under present conditions, utilized in a manner to -supply it at less than the cost of coal at present prices. - - - - -II. THE USE OF MACHINERY IN MANUFACTURING. 193 - - -The statements made in this discussion that the great expansion in the -production of manufactures came with the adoption of machinery for -manufacturing must not be understood as meaning that no machinery was -used in manufacturing prior to the period of expansion. Machines have -been used in manufacturing for many centuries. - -The spinning wheel, used many hundred years ago, was a machine, and so -was the hand loom, by which the threads spun by the wheel were woven -into cloth. Flax and wool were originally turned into thread by the -use of the distaff, a stick to which the spinner attached a small -portion of the fiber, and by revolving the stick against his body -twisted the fibers into a thread. Then by letting the end of the stick -drop downward he drew out the thread, and with another roll of the -stick against his body again twisted the fibers and lengthened the -thread, which he then wound around the distaff. After many years of -this process it occurred to somebody that by setting the distaff in a -frame and passing a cord or a piece of rawhide around it and also -around a large wheel and turning the wheel he could get a much more -rapid and regular revolution of the distaff. This was the beginning of -the use of the “machine” in the making of yarn, for the spinning wheel -was a machine, of a crude type, to be sure, but a machine. This served -many generations of men and women for the manufacture of thread and -yarn, from flax, from wool and from cotton. - -To turn this thread or yarn into cloth another “machine” was used, the -loom, which, by fixing the thread on certain frames and passing other -threads back and forth as the frames were raised or lowered, formed -the cloth. But this “machine,” the loom, was operated by human power, -as was that other machine, the spinning wheel. The women and children -spun the thread or yarn, the father and sons operated the loom, 194 -chiefly in the winter months in which they had no occupation in the -fields. If a man chose to give his time to weaving and became a weaver -by trade he lightened his heavy labors at times by attention to the -garden surrounding his workshop, performing the necessary work for the -production of his food supply. “The workshop of the weaver,” says Ure -in his History of the Cotton Manufactures, “was a rural cottage from -which, when he was tired of the sedentary labor, he could sally forth -into his little garden and with the spade or hoe attend to his -culinary products. The cotton which was to form his weft was picked -clean by the fingers of his younger children and was carded and spun -by the older girls assisted by his wife, and the yarn was woven by -himself assisted by his sons.” In the manufacture of woolen goods -conditions were similar. “The work,” says James in his History of the -Worsted Manufactures, “was entirely domestic, and its different -branches widely scattered over the country. The manufacturer had to -travel on horseback to purchase his wool among the farmers or at the -great fairs or markets, and the wool, after being sorted and combed, -was distributed among the peasantry and received back as yarn. The -machine used by them was still the old one-thread spinning wheel, and -in summer weather on many a village green might be seen the housewives -plying their busy trade. Returning with his yarn the manufacturer had -to seek out his weavers, who ultimately delivered to him his camelets -or russells or calimancoes ready for sale to the merchant or delivery -to the dyer.” - -These are pictures of the manufacturing industry in England as late as -1770. “Machines” were in use, but of the simplest type, and all -operated by the power of the man or woman using them, or at the best -by human or animal power, and in most cases the work was performed in -the household or a small shop adjoining the household. - -The transformation to the “machine method” or factory system began 195 -when some power greater than that of man or beast was applied to the -operation of the machines, and the machines themselves were so -enlarged as to multiply their producing power. “In tracing the effect -of the application of modern machinery to English industry,” says -Hobson in his Evolution of Modern Capitalism, “there appear two -prominent factors, the growth of improved mechanical apparatus, and -the evolution of extra-human motor power. We speak of the industry -which has prevailed since the middle of the eighteenth century as -‘machine production’ not because there were no machines before that -time but, firstly, because a vast acceleration in the invention of -complex machinery applied to almost all industrial arts dates from -that period, and secondly, because the application upon an extended -scale of non-human motor powers manifested itself then for the first -time.” “The water frame, the carding engine, and the other machines -which Arkwright brought out, in a finished state,” says Cooke Taylor -in his History of the Factory System, “required both more space than -could be found in a cottage and more power than could be applied by -the human arm. Their weight required them to be placed in strongly -built walls, and they could not be advantageously turned by any power -then known but that of water. Further, the use of machinery was -accompanied by a greater division of labor, and therefore a greater -co-operation was necessary to bring all the processes under a central -supervision.” - -The new and enlarged machines which were thus operated by water power -and brought together in factories had been invented chiefly during the -eighteenth century. John Kay, in 1738, invented what was known as the -flying shuttle, which doubled the amount of weaving which could be -performed by one man in a given time. Hargreaves, in 1764, invented 196 -the spinning jenny, a machine which operated a number of spindles for -spinning yarn, and so did many times as much as one spinner with a -spinning wheel could do. Arkwright, a few years later, devised the -water frame, by which the spinning jenny could be operated by water -power. Crompton, a little later developed the “spinning mule,” which -combined the important qualities of the spinning jenny and the water -frame. Before the end of the century the steam engine began to supply -power and was utilized in many cases where water power was not -available. Then, in 1792, came Whitney’s cotton gin, by which the -seeds were readily extracted from the cotton, and that valuable fiber -rendered much more available for manufacturing purposes. - -The effect of the development of the machine and factory system, -through the devices of these thoughtful men, enormously increased the -manufacturing industries of England and later of the other parts of -the world. The importations of cotton into England prior to the -invention of the spinning jenny averaged less than 2 million pounds -per annum. With the invention of the spinning jenny and the water -frame the importation of cotton and cotton manufacture quickly doubled -and trebled and then grew at such rapid rate that by 1800 the -importation was about 40 million pounds, by 1830, 260 million pounds -and by 1840 over 400 million pounds. The importation of wool grew from -less than 2 million pounds in the latter part of the eighteenth -century to 150 million pounds in 1860 and over 700 million pounds in -1890, though in this article of manufacture the growth in importation -was less strongly marked than in cotton because of the fact that much -of the wool used in manufacture was produced at home, while all of the -cotton used was imported. - -In the iron and steel industry the growth in the use of machinery was -even more closely connected with the great development of recent years -than in that of textiles. It was quite natural that man should seek 197 -the use of machinery in the iron and steel industry. The material to -be handled was of such great weight that it could not be handled in -quantities without the aid of extra-human power, and the fact that it -must be manipulated while at an intense heat necessitated the use of -devices of some sort for its handling. Yet a long time, a very long -time, elapsed after the beginning of the manufacture of iron and steel -before men developed the machinery which has resulted in such a -wonderful development in the manufacture. The slow rate of growth in -the earlier centuries, and the rapid rate in the past century may be -measured in some degree by the world’s production of pig iron, the -basis of all iron and steel manufactures. Mulhall estimates the -world’s production of pig iron in the year 1500 at 60,000 tons, in -1700 at 100,000 tons, and in 1800 at 460,000 tons. Then the increase -began to be more sharply defined, the production reaching 1 million -tons in 1820, 2½ million in 1840, 7 million in 1860, 18 million in -1880, 40 million in 1900 and nearly 60 million in 1907. The increase -in the eighteenth century was about one third of a million tons, and -that of the nineteenth century was 39½ million tons, or more than -100 times as much as that of the eighteenth century. The great -development in the transformation of iron into steel did not come -until the second half of the nineteenth century, the world’s -production of steel in 1850 being, according to Mulhall, 71,000 tons, -in 1870, 540,000 tons, in 1880, 4 million tons, in 1890,12 million, in -1900, approximately 20 million, and in 1907 about 40 million. The -growth in production of pig iron and steel was more rapid in Europe -than in the United States in the earlier part of the nineteenth -century, but in the latter part of that century the United States -outstripped all her rivals, and her production of iron and steel is -now more than that of any other two countries of the world. - -These wonderful developments in the production of iron and steel were 198 -even more dependent upon the development of machinery for transporting -the material and handling it in the factory than was the case with the -textiles. Pig iron cannot be made without having in immediate -conjunction three natural materials, iron ore, limestone and some -material to produce intense heat. The iron is only found in the form -of “ore,” being iron mixed with rocks, earth or other matter which -must be removed in order to use the iron. To do this the ore must be -heated. Formerly this was done by placing small quantities of charcoal -in a hole in the ground and placing the iron on top of it, and then -more charcoal on top of the ore. By fanning the burning charcoal or -blowing the fire from the lungs through a reed the heat was increased -and the ore was softened, and by hammering it while hot the useless -material was worked out. Then by further heatings it could be hammered -into such form as desired. After a while it occurred to men to build a -wall of stones and mud and place the ore and charcoal in this, and to -make a bellows of the skin of some animal (the prototype of those -which blacksmiths and other workers in metals now use), and so force -the air into the bottom of the mass of charcoal and iron. With this -the iron could be so heated that it actually melted and ran to the -bottom of the furnace, and when cooled was ready for the finer -processes by which it was made into the desired articles. After a time -the walls of the furnace were built higher and if it could be located -near to a waterfall the shaft of the water wheel was so adjusted as to -operate the bellows and keep the stream of air flowing into the fire, -for the heat of the burning charcoal was not sufficient to melt the -iron without this forced draft. - -This was the process by which men made iron for many generations. But -it was a very expensive process, for the quantity of wood which must -be used to produce the charcoal was so great that the forests were 199 -soon depleted, especially in England, where iron making became active. -Efforts were made to use coal instead of charcoal, but the weight of -the iron ore was so great that it crushed out the fire in the coal -which softened as it burned. Then after a time it occurred to somebody -to treat the coal in a manner somewhat similar to that by which the -wood had been transformed into charcoal, and coke was produced and -successfully substituted for charcoal in heating the iron ore and -making iron. - -In the United States the charcoal process was used until a period much -later than that of its abandonment in England, for the supplies of -timber were very great and men who were clearing the land for use in -agriculture were glad to turn the wood into charcoal and find a market -for it. The simple charcoal furnace and forced draft by a simple -process furnished the iron-making systems of the world until the early -part of the nineteenth century. As a result there were hundreds of -small furnaces, simply operated, and turning out small quantities of -iron, in various sections of the United States. Meantime somebody -discovered that if the air which was forced into the furnace was -heated before being sent into the fire it would greatly increase the -heat-giving power of a given quantity of charcoal or coke, and the hot -blast became a part of the larger furnaces. Then it was found that the -anthracite coal of the United States was hard enough to bear the -weight of the ore and would produce a heat sufficiently intense to -melt it; and so a great iron industry developed in the anthracite -region of the United States. Then it was found that certain bituminous -coal in western Pennsylvania would make excellent coke for the -manufacture of iron, and the Connellsville coke became a successful -competitor of anthracite coal, and later other cokes were also used. -Later came the natural gas discoveries and they contributed to iron -making and working. Meantime railways were built to carry the ore to 200 -the coal or the coal to the ore or both the ore and coal to some -convenient meeting point, and machinery began to be introduced for -handling the ore and the coal along the railway and at the furnace. -This led to the devising of other machinery for handling the iron -after it left the furnace and of rollers for rolling the iron into -bars and for giving it the sort of manipulation that the hammer of the -earlier iron maker had given it when produced in the primitive -furnaces. Then great deposits of iron ore, the richest known to the -world, were discovered in the Lake Superior regions; and steam-driven -machinery was devised to scoop it up from the beds in which it was -found, place it in cars, which in turn carried it to the water’s edge, -and dumped it into great receptacles from which it could run by the -force of gravity into the hold of the steamer. Then other machinery -operated by steam was devised to take it from the hold of the steamer -and load it again on the cars which transported it to the furnace -where it met the coal or the coke, produced, transported and handled -by similar machine processes, and was turned into iron to also be -handled by great machines. - -While all this was happening--indeed long before the later happenings -above mentioned--workers in iron had found that the pig iron coming -from the furnaces contained so much carbon that it could not be -successfully worked. So they managed to get rid of the carbon, by -melting the iron in an open hearth and passing flames over it, and as -the carbon is combustible it was gradually burned out. This made soft -malleable iron, but not of the consistency to have the required -strength or serve the purposes that are now served by steel. To bring -it to the proper condition it was necessary to reintroduce a very -small quantity of carbon so evenly that both the quantity and the -distribution could be determined. This was done for many years by -placing the bars of iron in a crucible or other closed receptacle 201 -surrounded by charcoal, and subjecting them to intense heat for -several hours or days. So the making of steel was a slow and expensive -process until about the middle of the nineteenth century. Then Sir -Henry Bessemer, an Englishman, discovered that by forcing air into the -bottom of a great retort containing molten iron the oxygen of the air -would combine with the carbon of the iron and in a few minutes the -objectionable carbon would be all burned out, and that by then -reintroducing in this molten mass of pure iron the required amount of -carbon in the form of spiegel iron or ferro manganese, steel could be -made much more cheaply and quickly than before. William Kelly, an -American, also devised a similar process about the same time. Thus -began the process of modern steel making, which has in a single half -century increased tenfold the world’s consumption of steel and thus of -iron, for a very large proportion of the iron now utilized in the -world is transformed into steel before being applied to the service -which it is to perform for men. - -In all the processes by which iron and steel making have been -transformed from the simple methods of a century or two centuries ago -to the present system by which a single establishment may now make in -a week or month or year as much iron or steel as the whole world then -made in an equal length of time, machinery and capital have been the -great causes of the development--machinery for digging iron and coal, -for transporting them to the place of manufacture, for handling the -material in the natural state, for handling it in the furnace, for -handling it in the molten state, for rolling and shaping it after it -passes from the molten state to that in which it begins to take the -form of the finished product, and capital to purchase this machinery -and the great quantities of material required. “The very richness of -our resources,” says J. Russell Smith in The Story of Iron and Steel, -“has made such a wealth of opportunity for occupation in the United -States that labor is and has been scarce. As a consequence the 202 -American iron industry has been driven over to a machine basis, and -its very success has arisen from the fact that a scarcity of labor has -compelled the introduction of machinery which has surpassed the dreams -of its inventors. In the iron and steel industry of America man does -little more than touch levers, while the balance is done by steam and -electricity. Four large Bessemer converters, holding 15 or 20 tons of -molten iron do their work by an air blast driven through the molten -material by the force of an engine. The electric cranes swing the -20-ton charges and the heavy converters as easily as a schoolboy -swings his dinner pail, and pours the new made steel into a metal mold -which stands on a tram ready to take it to the hydraulic machine which -draws the mold off the red-hot ingot. The manless way in which this -great steel ingot is turned into a useful piece of steel never ceases -to be a marvel. The great machines are seen but the plant seems to be -deserted. Then there arises a rumble and roaring noise and the great -piece of red-hot metal is seen to travel with all the independence of -a serpent across a lot of black rollers and dive into the jaws of the -rollers which squeeze it into flatter shape. Then it stops, turns over -and dives again through the same rollers, which flatten it still more. -After this has been repeated a few times you discover, standing on a -high platform, a man or two pulling the levers which start the -machinery of the six or seven thousand horsepower engines that drive -the knowing rollers which are crushing and rolling the ingot into the -shapes which man can use.” - -“Perhaps the greatest difference between English and American steel -works,” said an English writer on this subject, “is the absence of -laborers in the American mills. The large and growing employment of -propelling and directing machinery is responsible for this. In a mill -rolling three thousand tons of rails in a day not a dozen men are to 203 -be seen on the mill floor. To witness in such a mill the conversion in -a half hour of a red-hot steel ingot weighing several tons into -finished stamped steel rails ninety feet long, and all this perfectly, -by the agency of unseen hands, is to gain new ideas of the -possibilities of mechanism, of the subservience of matter to mind.” - -These are some of the steps by which the systems of the manufacturing -world have been, in the past 150 years, transformed from household -work, or that of the small shop, into that of the factory--and the -factory developed into enormous establishments through the investment -of great sums of money in the purchase and installation of -ever-improving machinery, more ingenious, more productive, more -costly, but turning out more and better of the finished product with -each new device and new investment of capital. - - - - -III. DEVELOPMENT OF THE FACTORY SYSTEM. - - -The inventions by which the manufacturing of the world was transformed -from the household and the workshop to the great factory were the -result of years, generations indeed, of study of conditions one by one -as they arose. “No one of the inventions which were greatest in their -effect,” says Hobson, “was in the main attributable to the effort or -ability of a single man: each represented in its successful shape the -addition of many successive increments of discovery; in most cases the -successful invention was the slightly superior survivor of many -similar attempts. This is the history of most inventions. The pressure -of industrial circumstances directs the intelligence of many minds -toward the comprehension of some single point of difficulty, the -common knowledge of the age induces many to reach similar solutions, -that solution which is slightly better adapted to the facts comes out -victorious, and the inventor, purveyor or in some cases the robber is -crowned as a great inventive genius.” - -England was the earliest scene of the development of the factory 204 -system, the bringing together of great buildings and centers of great -masses of machinery operated by water or steam power and manned by -great numbers of people--for however ingenious the machine a certain -amount of human intelligence is necessary for its management and the -conduct of the work which it is to perform. The reasons for the -earlier development in England are not difficult to find. It had its -colonies in all parts of the world, from which to draw the raw -material and in which to market the manufactures, for it for many -years discouraged or prohibited manufacture in the colonies; it had -great shipping facilities for transporting its products to all parts -of the world, and to bring raw material and food supplies to its -workers at home; the ownership of its lands in great estates had a -tendency to send to the cities and manufacturing centers that part of -the population which under other circumstances would have employed -itself in agriculture; the laboring population yielded more readily to -the methods of the manufacturing interests than in other countries -where trade guilds determined more definitely the occupations and -methods of occupation of the working classes; and the comparative -freedom from wars permitted a more rapid growth than that of other -countries in which disturbances of this character were more frequent -and more liable to frequency than in an insular country, England. -“When Crompton’s mule, Cartwright’s power loom and Watt’s engines were -transforming the industry of England,” says Hobson, “her continental -rivals had all their energies absorbed in wars and political -revolutions.” - -Much of the wool and flax required in the English industries was -produced at home. The colonies supplied the other fibers; the ships -returning from their voyages to the colonies brought the raw silk; the -absence of mountains to separate the country and the people into -districts and classes enabled the interchange of labor and materials; -the early development of rivers and canals gave cheap transportation; 205 -the plentiful supply of coal encouraged the development of steam -power; and the proximity of iron ore and coal aided in developing that -other great manufacturing industry, iron and steel. Mr. Mulhall, the -celebrated statistician, estimates the value of the manufactures of -the United Kingdom in 1780 at 177 million pounds sterling, France 147 -million, Germany 50 million, Austria 30 million, Russia, Italy and -Spain 10 million each, and the United States 15 million. In 1896 he -estimated the value of the manufactures of the same countries as -follows: United Kingdom, 876 million pounds sterling; France, 596 -million; Germany, 690 million; Austria, 328 million; Russia, 380 -million; Italy, 190 million; Spain, 121 million; and the United -States, 1,980 million. According to his estimate the gain in the 116 -years, from 1780 to 1896, was: United Kingdom, from 191 to 876 million -pounds sterling; France, from 115 to 596 million; Germany, from 50 to -690 million; Austria, from 30 to 328 million; Russia, from 10 to 380 -million; and the United States, from 15 to 1,980 million. Mr. -Mulhall’s estimates put the total value of the manufactures of -continental Europe in 1780 at about 1½ times those of the United -Kingdom; in 1896 at about 3 times those of the United Kingdom. His -estimates put the value of manufactures in the United States in 1870 -at about 3⅓ per cent that of all Europe; in 1896 at about 55 per -cent that of all Europe. - -It must not be supposed, however, that this transformation was, by any -means, instantaneous. It was, in fact, a matter of slow growth, even -in the older countries, and still more so in those countries which had -not yet developed their natural products or their agricultural -industries. In the case of the United States, for example, the -transformation from the hand to the machine methods did not come until -many years after that of the leading countries of Europe. The reason -for this slow movement on the part of the United States is not 206 -difficult to understand. Her people were chiefly engaged in -agriculture, in felling the trees and clearing the lands in the -eastern part of the country, and in opening farms on the prairies of -the great West. Those who had capital to invest in enterprises other -than that of agriculture gave their attention to the construction of -methods of transportation, first, toll roads, stage coaches and pack -trains, then, canals, and finally railways. This occupied the -attention of the people of this new country for a generation after the -people of Europe and especially England were engaged in developing -their manufacturing industries. - -So it is not surprising to see that Mr. Mulhall’s figures show that -English manufactures in 1820 were nearly 6 times as much as those of -the United States, and in 1840, 4 times as much as those of this -country; and even in 1860, considerably exceeded our own. But in the -next twenty-year period there came a great change. The Civil War in -the United States, with the home demands in the manufacturing section, -the North, rapidly developed the manufacturing industries, and the -development thus created continued after the close of that unhappy -period. So his figures indicate that in 1888, the next date which his -table touches, that our manufactures were 1¾ times as much as those -of the United Kingdom, and in 1896, 2¼ times as much in value as -those of the United Kingdom and half as great as those of all Europe. -Accepting the figures of Eugene Parsons, elsewhere referred to, for -the European countries in 1904, and accepting the official figures of -the United States for that same year, we find that the figures of the -value of manufactures in the United States are nearly 3 times those -accredited to the United Kingdom and but little less than those of all -Europe. - -It is proper to say, however, that these statements, whether of -Mulhall, Parsons, or other authorities on this subject, are liable to -be extremely misleading unless carefully and intelligently 207 -considered. The reason of this is found chiefly in the fact that the -official figures of the United States are made up on a materially -different basis from those of the other countries in question. To be -sure, the figures of the United States are official and therefore may -be considered reliable as to the facts which they purport to show, but -in fact some of the things which they purport to show are presumably -quite different from those quoted for the other countries included in -these estimates--for they can be only estimates for the other -countries, since no country other than the United States takes a -census of manufactures (England is taking one as this text is being -issued, but has not yet completed it), and the figures quoted -regarding their manufactures are necessarily estimates. Generally -speaking, it may be said that the census of the United States includes -certain articles which are not usually classified as manufactures in -other countries, such as products of slaughtering, canning, the -milling industry, etc. Aside from this it must also be remembered that -the usually quoted figures of the United States’ manufactures include -many duplications, due, as elsewhere explained, to the fact that the -total so quoted is merely an aggregation of the product of all -factories; and as the product of one factory often becomes the -manufacturing material of another, its value is again reported by the -manufacturer who reports merely the total value of his products. These -duplications are so numerous and prevail in such important and costly -articles that the census estimates the net or true value of our -manufactures at but about two-thirds as much as the usually quoted -figures of gross products. It would appear, therefore, that the -usually quoted figures of “manufactures in the United States,” when -compared with the estimate of manufacturing in other countries, should -be reduced about one-third to make them properly comparable with those -usually quoted for the other countries of the world. Even if this 208 -were done, however, it would show the value of the United States’ -manufactures probably about twice as great as those of the United -Kingdom and probably little less than those of continental Europe. - -Taking Mulhall’s figures for the other countries which he includes, as -presented in a table on another page of this text, it will be seen -that the chief growth in manufacturing during the 116 years covered by -the table under consideration has occurred in the last third of the -period. English manufactures, he says, grew from 177 million pounds -sterling to 290 million in the 40-year period from 1780 to 1820; from -290 to 577 million in the next 40 years, from 1820 to 1860; and from -577 to 976 million in the 36 years from 1860 to 1896--a growth of 113 -million pounds sterling in the first 40 years, of 287 million in the -second 40 years, and of 400 million in the third period of 36 years. -Germany showed a more rapid growth in the third period; the growth in -the first 40-year period being from 50 million pounds sterling to 85 -million; in the second 40-year period, from 85 to 310 million; and in -the third period, of 36 years only, from 310 to 690 million. France -has not made as rapid a gain as Germany, the figures showing her -products in 1780, 147 million pounds sterling; in 1840, 220 million; -in 1860, 380 million; and in 1896, 596 million. - -The total of Mulhall’s table, including the somewhat over-estimated -figures of the United States, and relating chiefly to the products of -Europe and the United States, show total manufactures of all the -countries named, in 1780, 480 million pounds sterling; in 1820, 865 -million; in 1860, 2,404 million; and in 1896, 5,710 million, again -indicating that the chief growth has occurred in the last third of the -period under consideration, the period of transformation from the hand -industries to those of machine production in conjunction with vast -sums of capital and plentiful transportation facilities for collecting -the raw material and distributing the finished product. - -When we consider nations or groups of people and their use of modern 209 -methods of manufacturing, we may properly say that the principal -manufacturing sections of the world are western Europe and the United -States, and that, as above indicated, the bulk of the world’s -manufactures by the factory process are now produced in those two -sections of the world. Manufacturing by machinery may perhaps be said -to have originated in England, spreading thence to France, to Germany, -and westward to the United States. More recently it has extended in a -somewhat limited form into Canada in the west and India and Japan at -the extreme east. India has utilized modern methods of manufacture, -especially in cottons and certain other industries, for more than a -score of years, while the one other country of the Orient which has as -yet entered the field of machine manufacture, Japan, though somewhat -later in adopting machine methods, has been more active and extended -modern manufacturing to a much greater variety of industries than have -the people of India. - -While certain of the European countries were earlier in the -manufacturing field than the United States, the larger population, the -greater supply of natural materials, the larger supplies of fuel for -cheap power, the ingenuity of the American workman, and the enormous -domestic demand of an active and prosperous people, have brought the -United States clearly to the head of the list of manufacturing -nations. It may safely be said that the value of manufactures produced -in the United States is approximately twice as great as that of any -other manufacturing nation, and that the stated value of our -manufactures is nearly as great as the estimated value of the -manufactures of all Europe. The latest official figures on the value -of the manufactures of the United States are those of the Census -Bureau, which put the value of manufactures produced in the calendar -year 1904, as recorded by the Census of 1905, at 16,867 million -dollars, including in this an estimate of a little more than 2 210 -billion dollars’ worth of manufactures classed as “mechanical and -neighborhood industries,” which were included in all former census -reports, but not recorded by the Census of 1905, which was by law -merely a census of manufactures produced under “the factory system.” - -No other country than the United States takes a periodic census of its -manufactures. The United Kingdom is at the present time about taking -for the first time a census of its manufactures, but no figures with -reference thereto are as yet available. As a consequence all -statements regarding the value of manufactures of European countries, -or indeed of any country other than the United States, are estimates -and estimates only. True, they are based upon certain known facts of -quantities of raw materials consumed in manufacturing, values of -manufactures exported, and the estimated proportion which these form -of the total manufactures; but in no other country than the United -States are there available official statements of the total value of -manufactures produced in the country in question. Therefore the -estimates of the value of the manufactures produced by European -countries which are quoted from time to time and which are presented -elsewhere in this text, must be accepted as merely estimates. A -comparatively recent estimate, and one which has been given wide -publicity, and appears to have been generally accepted, is that of -William J. Clark, published in The Engineering Magazine in 1904, which -put the value of the manufactures of the United Kingdom at 5 billion -dollars, Germany 4,600 million, France 3,450 million, Austria-Hungary -2 billion, Russia 1,980 million, Italy 1,700 million, Belgium 750 -million. These estimates, if accepted, would bring the value of the -manufactures of the countries enumerated to a figure slightly in -excess of that officially reported by the Census Office as the value -of the product of all manufacturing establishments of the United -States in 1904. The figures above quoted for certain European countries 211 -present however no estimate of the value of the product of -Switzerland, Spain, Holland and the Scandinavian countries, so that it -probably might be said with greater accuracy that the stated value of -the manufactures of the United States is about equal to the estimated -value of continental Europe, and about three times as great as the -estimated value of the manufactures of the United Kingdom. - -It is proper, however, before leaving this question of the relative -value of the manufactures of the various countries, to again call -attention to the fact that the official figures of the value of -manufactures produced in the United States include certain articles -not classed in certain other countries as manufactures, and in -addition to this contain many duplications due to the fact that the -products of one manufacturer frequently become the raw material of -another, and thus the grand totals which merely combine the stated -value of the product of each manufacturer necessarily include a second -and in some cases a third valuation of the products thus utilized. The -manufacturer of yarn, for example, reports to the Census Office the -full value of the product of his factory. The manufacturer of cloth, -who utilized that yarn, also reports the full value of the product of -his factory, and thus includes in that valuation the value of the yarn -purchased by him but already reported by the manufacturer of yarn. The -manufacturer of clothing, in stating the value of the product of his -factory, includes the sums which he paid for the cloth already -reported by the manufacturer of clothing and included in his -statement. Thus many duplications occur in our census statement of the -gross value of the products of the manufacturing industries of the -United States. “This gross value,” says the Census Report of 1900, -page cxxxix, “does not represent the final value of the manufactured -products of the country. It does fairly represent the total value of 212 -commercial transactions involved in manufacturing enterprises…. As -the finished products of one branch of manufacture are constantly used -as materials in other branches, in the ascending scale of modern -industry, it follows that they are counted over and over again, -swelling in this manner the gross total value of products. Thus in -cotton manufacture, the product of the yarn mill, manufacturing yarn -for sale as the material of the cloth mill, and the product of the -cloth mill as the material for the manufacturer, so that by the time -the aggregate is made the value of the yarn has been counted three -times and the value of the cloth twice…. Duplications and -re-duplications of this sort run all through the total value of -products as reported by this (the Census) office. * * * The net or -true value of the products is found by subtracting from the gross -value the cost of all materials purchased in a partially manufactured -form. In 1900 the cost of these manufactures was $4,633,804,967 and” -(subtracting this sum from the gross value, $13,004,400,143), “the net -value of products was therefore $8,370,595,176.” - -When it is further considered that the Census of Manufactures in the -United States includes in its list of manufactures all products of -slaughtering and meat-packing establishments wholesale, valued in 1905 -at 112 million dollars, the product of printing and publishing -newspapers and periodicals only, valued at 309 million, and the -product of canning and preserving fish, oysters and vegetables, valued -at over 100 million--it will be seen that an effort to determine even -approximately the share of the world’s manufactures produced by the -United States or by the various manufacturing nations of the world is -a difficult--an impossible--task. - -It may safely be asserted, however, that the United States is the -world’s greatest manufacturing nation, and that the value of our -manufactures exceeds those of any other country. This is due, as -already indicated, to the fact that our supply of raw materials is 213 -greater than that of any other country, our supply of materials for -producing power also greater than that of any other country, our use -of machinery for manufacturing far in advance of that of any other -nation, the activity of our inventors and the skill of our workmen -quite equal to those of any other part of the world, and the demands -of our home population upon our own manufacturers far in excess of -those of any other country, both by reason of the large population and -high purchasing power of a people prosperous and active in all lines -of industry--agriculture, transportation, manufacture. The country -which produces three-fourths of the world’s cotton, twice as much iron -and steel as any other single nation, as much copper as all of the -remainder of the world combined, more of wood suitable for use in -manufacturing than any other country, more wool than any other of the -manufacturing nations, and a population much larger than that of any -other country actively engaged in the manufacturing industries, has -quite naturally and almost necessarily become the leading manufacturer -of the world. - -The growth of the manufacturing industry in the United States has been -phenomenal. Stated in the methods of valuation followed by the census -above referred to--the gross valuation--the value of manufactures -produced in the United States has been, speaking in round terms, in -1850, 1 billion dollars, in 1860, a little less than 2 billion, in -1870, 4¼ billion, in 1880, 5⅓ billion, in 1890, 9⅓ billion, -in 1900, 13 billion, and in 1905, a little less than 17 billion, -though the figures usually quoted for 1905 are 14.8 billion, owing to -the fact that the Census of 1905 only included factory products, and -added parenthetically an estimate of 2 billion as the probable value -of the “mechanical and neighborhood industries,” thus bringing up to -nearly 17 billion the total properly comparable with the totals of 214 -earlier periods, which in all cases included the mechanical and -neighborhood industries. - -That this rapid growth in the value of manufactures has been far in -excess of the consuming capacity of the home population is evidenced -by the growth in exportation of manufactures, which aggregated in -1880, 122 million dollars, in 1890, 179 million, in 1900, 484 million, -and in 1908, 750 million. Manufactures formed in 1880 but 15 per cent -of the total exports, in 1890, 23 per cent, in 1900, 35 per cent, and -in 1908, 41 per cent of the total merchandise exported from the United -States. - - - - -IV. CAPITAL IN MANUFACTURING. - - -Another factor which entered into the modern system of production, and -a very important one, was that of capital. The factory could not be -established or operated without considerable amounts of money or its -equivalent, credit. The machinery which transformed the raw material -into the finished product, the material itself, the very buildings in -which the work was performed, the payment for the transportation which -brought it together, the wages of the men and women engaged in the -work, all required capital, and in large sums. The accumulation of -this capital, its management, the keeping of accounts of cost of -material and labor and of the finished product, required financial -skill and acquaintance in the markets in which this capital could be -obtained; for often the sums required were in excess of the quantity -possessed by the individual who had invested his all in the buildings -and machinery, and must needs borrow of some other capitalist the -additional sums required for purchasing material and paying the wages -of his workmen. Sometimes the owner of the capital preferred to supply -it and take a proportionate share in the earnings of the factory, and -thus developed the company. Then, as the business grew and the -investments of various men in a single establishment increased, it -became necessary for them to take an active share in the management 215 -either in person or by representatives who became known as the -“directors” of the work. - -Thus arose the successors of the individual manufacturer, the company, -and the corporation. Man must die and the death of an individual -manufacturer, or the manager of a manufacturing firm or partnership, -must affect disadvantageously the interests of the factory and its -employes. Thus the importance of organizations which would continue -unchanged in form and general management in case of the absence or -death of any individual. This was one of the reasons for the -establishment of the corporation. More important than this was the -facility which it offered to holders of capital in sums large or small -to invest their money in manufacturing without being compelled to give -their individual attention to the industry in which the money was -invested. The board of directors, which the investors might choose, -managed the business either by personal attention or by the selection -of competent and experienced persons for that service, and the -investor felt assured that his money would be properly managed by the -competent business men forming the board of directors and the experts -whom these directors might employ to manage the details. Hence the -corporation, under which the manufacturing establishments grew to -enormous proportions, employing thousands and tens of thousands of -people, and bringing material from the places in which it could be -most cheaply obtained, investing money if need be in facilities for -transporting and even producing the raw material, and cheapening the -cost of production. - -Another step which increased the importance of capital as a factor in -the great manufacturing industries of the world came in more recent -combinations of great corporations, in which a number of great -manufacturing establishments agree to operate under one general -management, thus adjusting production in the various lines of 216 -manufacture to the general demand, existing supply and prospective -consuming power of the markets, establishing systematic methods for -exploiting and selling the finished product, and so further minimizing -cost of production and distribution. This last combination, the -corporation of corporations, is generally known as the “trust” or -“combine,” and under it the great manufacturing industries of the -world have reached their greatest development, the cost of production -has been minimized, the field for the selection of the materials has -been enlarged, and the area in which the products are offered for sale -also greatly extended. - -While these great organizations, made up by placing under one general -management a number of great establishments manufacturing articles of -like character, are doubtless able to reduce the cost of production -and distribution and prevent production in excess of probable demand, -it is also true that they are in many cases able to exercise a greater -control over prices of labor, of material and of finished product than -when operating singly. - -Meantime the world’s supply of money for investing in manufacturing, -and the industries which contribute thereto, greatly increased. The -world’s gold production in the decade ending with 1840 averaged but -13½ million dollars per annum. Then, owing to the gold discoveries -in California and a little later in Australia, the production so much -increased that the annual average in the decade ending with 1860 was -135 million dollars per annum, or ten times as much as on the average -in the decade ending with 1840. For the next 35 years the production -averaged about 125 million per annum. Then, suddenly, through the -discoveries of great gold deposits in Africa and Alaska, the -production began to exceed 200 million per annum, then 300 million, -and in 1906, 1907, 1908 and 1909 averaged more than 400 million per 217 -annum, or as much in a single year as in the 40 years from 1800 to -1840. - -Gold, unlike most other productions prized by man, is not consumed. It -has enduring qualities; and the facility with which it can be -transformed without material loss from one form for use to any other -required form enables man to retain and accumulate a large part of the -products of a long period. The wheat produced in one year is eaten -before the next year is ended. The cotton crop of one summer is turned -into clothing and worn to rags by the time another crop is ready for -the factory and workshop. But the gold is conserved and utilized as -money or the basis of money, and the accumulations of the recurring -years merely increase the stock of that generally accepted medium of -exchange. To be sure a small share, perhaps one-fifth, is used in -manufacturing and the arts, and a small percentage lost in various -ways; but probably three-fourths of the gold product enters -circulation in the form of money or its equivalent, and thus increases -very rapidly the world’s money supply. - -Meantime the systems built up in the business world by which business -is performed with mere pieces of paper which represent the gold and -silver accumulations have greatly multiplied the available stock of -money; and the ease with which it may be transferred from place to -place, from country to country, and from continent to continent also -adds to its availability and frequency of use in the world’s -transactions. The supply of that article which the manufacturing and -business world terms “money,” whether in the form of gold, silver, -paper, credits, instruments of exchange, or otherwise, has increased -beyond accurate computation. The world’s stock of gold has, according -to the estimates of experts, doubled in the last 25 years; and it is -probable that the supplies of other forms of currency; which serve as -money; have increased quite as rapidly. - -All of this increase in the world’s supply of money has increased the 218 -amount available for investment in manufacturing, and the increased -use of machinery meantime in that industry has required great -increases in the investment. While there are no ways of accurately -measuring the world’s investments in manufacturing, it is practicable -to do so in the case of the United States, the only country which -regularly takes a census of its manufacturing industries. Its figures -for the census years from 1850 to 1905, as to number of -establishments, persons employed, wages paid, capital invested and -value of product, are as follows: - - ======+==========+=========+===========+========+=========+========= - | | | | Wages | Cost of |Value of - Census|Establish-| Capital,| Wage- | Paid, |Material,|Product, - year.| ments, | million | earners, |million | million |million - | number. | dollars.| number. |dollars.| dollars.|dollars. - ------+----------+---------+-----------+--------+---------+--------- - 1850 | 123,025 | 533 | 957,059 | 237 | 555 | 1,019 - 1860 | 140,433 | 1,010 | 1,311,246 | 379 | 1,032 | 1,886 - 1870 | 252,148 | 2,118 | 2,053,996 | 776 | 2,488 | 4,232 - 1880 | 253,852 | 2,790 | 2,732,595 | 948 | 3,397 | 5,370 - 1890 | 355,415 | 6,525 | 4,251,613 | 1,891 | 5,162 | 9,372 - 1900 | 512,254 | 9,817 | 5,308,406 | 2,322 | 7,345 | 13,004 - 1905 | 533,769 | 13,872 | 6,157,751 | 3,017 | 9,498 | 16,867 - ------+----------+---------+-----------+--------+---------+--------- - -It will be seen from a study of this statement, which compares -conditions in the manufacturing industries at each recurring census -from 1850 to 1905, that while the number of establishments in 1905 was -four and one-third times as many as in 1850 the number of wage-earners -was six and one-half times as many, the wages paid twelve and -one-third times as much, the value of the product sixteen and one-half -times as much and the capital employed twenty-six times as much. - -This gives at least a suggestion as to the growth of investment in -manufacturing. So far as relates to the United States, the only -country for which we have statistics on this subject, the enormous -increase in the use of costly machinery in manufacturing has increased -the sums required for carrying on the industry, and machinery has in a -marked degree been substituted for man in the factory operations. 219 -The number of wage-earners employed increased, it will be seen, a -little more than fivefold while the capital employed increased -twenty-fivefold. The tendency to bring the manufacturing industries -into large establishments is also shown in some degree in the fact -that while the number of establishments increased but about threefold -the number of employes increased fivefold and the value of the -manufactures turned out increased twelvefold. - -Even these figures do not, however, give a complete view of the -relative growth in the number of large manufacturing establishments, -the capital invested and the product turned out, because of the fact -that the census enumeration of “manufacturing establishments” includes -hand and household industries, such as blacksmith shops, wheelwright -and wagon repair shops, boot and shoe repairers, harness makers, -tailor shops, dress making, millinery, carpenter shops, custom, saw -and gristmills, etc., etc., in all of which the capital invested or -the product per establishment at this time averages probably little -more than formerly. It is in the greater establishments, the -factories, that the increase in investment and in producing power per -factory has occurred. The Census of 1905, which was by law confined to -manufacturing establishments conducted under the factory system, and -that exclusive of neighborhood and mechanical industries, found that -the number of establishments manufacturing for the general market and -not merely for local orders or neighborhood consumption, and which -could thus be considered as manufacturing establishments conducted -under the factory system, was but 216,262, while under the former -method of including hand and neighborhood industries the number of -establishments would, it is estimated by the census, have been in -1905, 533,769. The 216,262 establishments enumerated as “conducted -under the factory system” employed $12,686,000,000 capital and -5,470,321 wage-earners, or an average of 25 each, and turned out 220 -$14,802,000,000 worth of manufactures; while the 317,506 smaller -establishments, the “hand and neighborhood industries” formerly -included in the general census returns, are estimated as having -employed $1,186,000,000 of capital and 687,430 wage-earners, or an -average of about 2 employes each, and turned out $2,066,000,000 worth -of manufactures. - -It will thus be seen that the larger manufacturing establishments, -those “conducted under the factory system producing articles for the -general market as distinguished from the product made upon order for a -customer,” are those proper to be included in a study of the -development, capital invested, persons employed, wages paid, material -used and value of the product turned out. Unfortunately a study in -this form cannot be extended over any considerable term of years, -because of the fact that the United States census only began in 1905 -to make this distinction or separation of the true “factory” from the -great mass of establishments turning out manufactured products. It -did, however, present in 1905 an estimate for the year 1900 of the -number of establishments properly comparable with those enumerated in -the factory census of 1905. This estimate puts the total number of -“establishments conducted under the factory system” in 1900 at -207,562, and in 1905 at 216,262, an increase of but 4.2 per cent in -the number, while the capital employed in 1900 was $8,979,000,000, and -in 1905, $12,686,000,000, an increase of 41.3 per cent; the -wage-earners in 1900, 4,715,023, and in 1905, 5,470,321, an increase -of 16 per cent; wages paid in 1900, $1,736,000,000, and in 1905, -$2,266,000,000, an increase of 30.5 per cent; materials used in 1900, -$6,578,000,000, and in 1905, $8,504,000,000, an increase of 29.3 per -cent; value of product in 1900, $11,411,000,000, and in 1905, -$14,802,000,000, an increase of 29.7 per cent. - -It will thus be seen that even in the recent period, 1900 to 1905, the -percentage of growth in “capital invested” was greater than in any 221 -other important branches of the industry, the increases being: in -capital 41.3 per cent, in wages paid 30.5 per cent, in value of -product 29.7 per cent, and in number of wage-earners 16 per cent, -while the number of establishments increased meantime but 4.2 per -cent. It is thus apparent that although the tendency of the past -thirty years has been distinctly toward an enlargement of the factory -through the increase in capitalization rather than an increase in the -number of establishments, that tendency still continues as the most -distinctly marked characteristic of the development of the period 1900 -to 1905. - -Unfortunately the facilities for comparing the capitalization, -product, etc., in 1905 with that of earlier years only extends, in its -relation to all the factory industries, to the Census of 1900. In a -few of the important industries, however, it is possible to compare -conditions in 1900 with those of earlier censuses. The Census of 1900 -shows that the number of boot and shoe factories in the United States -fell from 1,959 in 1880 to 1,600 in the year 1900, while the -capitalization increased from an average of $21,957 per factory to -$63,622 per factory, the number of wage-earners from 57 to 89 per -factory, the wages paid from $21,951 to $36,985 per factory, and the -value of the year’s product turned out from $84,763 per factory to -$163,142 per factory. In cotton goods the number of establishments in -1880 was 1,005, and in 1900, 1,055, the capital per establishment in -1880, $218,412, and in 1900, $442,882, the number of wage-earners in -1880, 185 per establishment, and in 1900, 287, the wages paid in 1880, -$45,387 per establishment, and in 1900, $80,180, the value of product -in 1880, $209,901 per establishment, and in 1900, $362,349. In iron -and steel the number of establishments was in 1880, 699, and in 1900, -668, average capital per establishment in 1880, $294,652, and in 1900, -$858,371, wage-earners per establishment in 1880, 197, and in 1900, -333, wages paid per establishment in 1880, $78,020, and in 1900, 222 -$180,869, value of product turned out per establishment in 1880, -$418,583, and in 1900, $1,203,545. In woolen goods the number of -factories fell from 1,990 in 1880 to 1,035 in 1900, the capital per -establishment increased from $48,289 in 1880 to $120,180 in 1900, and -the value of the product increased from $53,755 per establishment in -1880 to $114,425 in 1900. - -It will be seen from the figures above presented that in these four -great industries the tendency from 1880 to 1900 was distinctly in the -direction of reduction of the number of factories, and a greater -increase in capitalization than in that of persons employed, wages -paid or in value of product turned out; while the figures covering the -operations of the entire factory system for the period 1900 to 1905 -also show a continuation of this same tendency toward a greater growth -in capital than in persons employed, wages paid or value of product -turned out. - - - - -V. TRUSTS AND COMBINATIONS. - - -The great increase in the size of the manufacturing establishment and -of the capital invested in the manufacturing industry which -necessarily followed the adoption of expensive machinery for -manufacturing purposes was followed by a tendency toward co-operation -and mutual agreements among the great organizations engaged in similar -lines of work, the purpose being to reduce expenses, increase profits -and control prices. Originally the persons, firms or companies engaged -in manufacturing disposed of their products as best they could and in -direct competition with others in their own line of manufacture. If -the market for their product was good they demanded higher prices. If -there was an oversupply they sold for whatever profit they could get, -or if necessary at cost or even lower than cost, in order to prevent -accumulations of stocks or the closing of their factories. The -competition thus grew intense. In order to dispose of their goods they -must put many salesmen into the field, they must advertise freely, 223 -and often their orders came from such distances that the cost of -delivery formed a large percentage of the cost of the goods by the -time they reached the purchaser. - -This competition of one manufacturer with another making the same line -of goods was not only expensive but resulted in working at cross -purposes in many ways, and in loss of energy and money. So certain of -the companies or corporations engaged in like industries began to make -agreements among themselves by which they could co-operate in -distributing their supplies to a given field and reduce the expenses -of supplying that field. It was argued that the people of any section -would only use a given amount of any standard product, and that the -expense which the various manufacturers were incurring in competing -among themselves for their respective shares in that trade might be -materially reduced by an agreement through which the extraordinary -efforts to sell in competition with each other should be abandoned and -each manufacturer receive the share of the sales to which his -proportion of production would entitle him. Not only would this reduce -unnecessary expenses but it would in some degree render possible the -maintenance of prices as they might be mutually agreed upon. - -The first steps in combinations or agreements of this sort are known -as “pools.” “This form of agreement,” says J. Russell Smith, “provides -that each of the makers of a certain material for a certain territory -should make a stipulated proportion of the product to be sold at an -agreed price. If a factory made more than its share the owner made a -cash payment to the pool and the money went to some manufacturer who -had made less than his share. The weak spot of these pools was their -absolute lack of power of coercion and that no member had faith in the -others.” Often members took advantage of technicalities to violate the -spirit of the agreement, and the agreements were short-lived. The 224 -system, while it is still working satisfactorily in Germany under the -name of the “cartel,” failed to give satisfactory results in the -United States, and also met with disaster in the fact that the courts -held it to be a combination in restraint of trade and therefore -unlawful. - -To overcome these defects and create a system of division of -production, control of prices and distribution of profits in -proportion to the value of the plants co-operating, a new form of -agreement was devised. It provided that the companies or corporations -entering the agreement for mutual operation and proportionate -distribution of profits should transfer the shares of their respective -properties to a new corporation with full powers to manage the same, -receiving in lieu thereof certificates which should entitle the holder -to his proportionate share of the net earnings of the new corporation. -“Under this form of organization,” says the Universal Encyclopedia, -“the stockholders of each of the separate companies assigned their -stock to a few trustees, giving thus an irrevocable power of attorney. -In lieu of the stock assigned the trustees issued stock certificates -to the stockholders of the separate companies and upon these trust -certificates profits were divided. All of the earnings of the -different members of the company were pooled and each manufacturer -received his proportionate share as evidenced by the certificates, -regardless of the question whether his establishment was running or -closed. The trustees, having in their hands the voting power of all -the stockholders, elected whatever persons seemed to them best as -officers of the separate companies. In this way the management was -absolutely unified and the interests of all parties concerned became -as one. The courts finally holding that this trust agreement was -illegal, the plan was later adopted of organizing a new company which -should buy up all of the separate plants of the different companies -entering the combination, so that in this way a unified management was -secured within the law. In order that a more convenient form of 225 -handling the properties of the different companies might be secured, a -third form of organization was later adopted in which a new company is -organized as a stockholding company. This company then buys up all, or -a large proportion of, the stock of each of the companies coming into -the organization and controls these stocks. The officers of the -central organization are thus in a position, by voting the stocks of -different companies, to elect the directors and officers of those -companies and thus control their policy.” - -The advantages of this combination over competition are summed up by -the Encyclopedia Britannica, in its 1902 edition, as follows: (1) The -cost of selling may be greatly lessened; (2) the salaries of -commercial travelers and their traveling expenses can be largely -reduced; (3) if different manufacturing establishments, scattered -throughout the country, are brought under one management it will be -possible for orders for goods to be distributed so that goods can be -dispatched to customers in each case from the nearest establishment -and freight expenses reduced; (4) when several establishments are -combined the most skillful of the managers can be selected for the -general manager; (5) each business manager is likely to have some -special excellence in his methods of management, and by combining the -establishments it is possible to so distribute this managerial skill -as to give to each branch of the work the man best suited to its -conduct; (6) it is also possible to distribute the various branches of -the manufacturing to the various mills or factories of the combination -best suited for that particular branch of the work; (7) the advantages -of unifying in one establishment the machinery of selling the product -of all; (8) the ability of an establishment to fill large orders on -short notice gains and retains business; (9) the great financial and -business strength and skill of the combined organization gives it -special facilities for pushing its goods into foreign markets, as is -shown by the success abroad of the Standard Oil Company, and the 226 -American Tobacco Company; (10) better facilities for dealing with -credits and thus aiding the business community. - -Whether trusts, through their control of prices of the particular -commodities which they manufacture, have actually advanced the selling -price to the consumer, has been and is still the subject of much -discussion. It has been urged that the mere reduction of the cost of -production and distribution which results from the combinations would -enable them to realize larger profits than formerly, even if the -manufactures are sold at former prices, and that although their -profits have doubtless been large it has not been accomplished through -an actual advance in prices to the public, but rather through -economies of production and sale. Nelson’s Encyclopedia, issued in -1908, discussing this subject, says, “The weight of evidence indicates -that, judged from the margin between price and finished product and -cost of raw materials, prices are increased somewhat by the existence -of trusts. It is a fair conclusion that the actual prices of goods -have as a rule been somewhat increased by trusts, although not in the -measure that was anticipated at the inception of the trust movement.” -The Encyclopedia Britannica of 1902 in discussing this subject says, -“Experience seems to show beyond question that whenever the -combinations are powerful enough to secure a monopolistic control it -has usually been the policy to increase the prices above those -obtained during the period of competition which preceded the formation -of the combination.” - -As to the effect of trusts upon wages it may be said that up to the -present time no very strongly marked change is perceptible in the -matter of rates of wages paid by the trusts as compared with other -employers in the same line. Doubtless the combinations of numerous -establishments under one general management have reduced the numbers -of employes in certain lines, but in those lines in which the trusts 227 -require labor for the carrying on of their work no marked changes in -the rates of wages have been developed as a result of the -combinations. In steadiness of employment for the men and women -engaged in the work of the establishments it seems probable that the -trusts or great combinations of this character offer certain -advantages, since their business is less liable to fluctuations than -that of the smaller, and even in the absence of orders they are more -likely to continue work accumulating stocks for future use than is the -small manufacturer with limited capital or credits. In the matter of -relations with the labor organizations certain of the trusts have made -long time agreements with the labor organizations, thus adding to the -steadiness of employment, though in some cases the trusts have -declined to recognize the demands of labor organizations. - -An example of the causes and methods of the combination of kindred -manufacturing interests under one general central organization is -found in the United States Steel Corporation as described by J. -Russell Smith, in his “The Story of Iron and Steel.” No industry, he -says, is naturally so uncertain and consequently so competitive as the -steel industry. The demand for the product is fitful and uncertain -because most of it goes into new constructions and new enterprises, -and these are notorious for the spurts and depressions of demand which -affect them…. The uncontrolled iron and steel market can make wild -rises unknown to many commodities, because it is difficult to suddenly -increase the amount of manufactures in response to sudden demand. A -wave of prosperity sends a thousand industries which must have iron -and steel clamoring, begging for steel. When the industrial sky -darkens purchases of iron and steel cease as suddenly as they began -and the price must tumble if the output is sold. These were the normal -conditions through which all steel makers lived down to the depression -of 1893-98. The numerous independent manufacturers thought that if 228 -they could get together and agree upon prices they could improve their -condition. Attempts to achieve this in the form of pools provided that -each of the makers of a certain material should make a stipulated -proportion of the product to be sold at an agreed price, and if a -factory made more than its share, the owner made a cash payment to the -pool. The weak part of these pools was their absolute lack of power of -coercion, and the further fact that no member had faith in the other. - -The failures in the attempt at price control resulted in the -consolidation of many companies, formerly rivals, under one control. -The chief companies which later became members of the United States -Steel Corporation formed two distinct groups, each group classified -according to the product. One group included the manufacturers of -unfinished steel, such as ingots, billets, plates and slabs, and -included the Carnegie Steel Company, the Federal Steel Company, and -the National Steel Company. Other companies which purchased the -product of these manufacturers of unfinished steel and turned it into -the finished state included the American Tin Plate Company, the -National Tube Company, the American Steel and Wire Company and others. -The first thought which came to the minds of this finishing group when -hard times compelled them to cut down costs was to cheapen their raw -material (such as pig iron, steel ingots, billets, etc.) by becoming -manufacturers of their own pig iron. The Carnegie Steel Company had -already done this and had obtained facilities for transporting the ore -to the coal fields of Ohio and Pennsylvania and facilities for -transforming the ore into the classes of material which it supplied. -The Carnegie Steel Company thus became independent of other companies -in the supply of its fuel, its ore, and the transportation of the -same, and all of the requirements of operation. When the finishing -companies announced their purpose to also supply themselves with the 229 -same facilities for producing their own raw material through the -ownership of ore lands, transportation, facilities for smelting, -manufacture of pig iron and the steel which they themselves required, -the raw materials group could not view this operation with unconcern. -It meant the loss of their market and necessity of seeking new markets -in the United States or in foreign countries. As a consequence, the -companies designated as the raw materials group, making pig iron, -steel billets, etc., announced that they would establish their own -finishing plants and thus compete directly with the group of companies -which had formerly occupied the field without interference by the -great organizations transforming the ore into the earlier processes of -pig iron and steel billets. Mr. Carnegie announced that he would build -a finishing mill in northern Ohio at the end of his ore railway which -would eclipse anything that the world had ever seen and would be in -equipment without a rival in the world. The Federal Steel Company -increased its holdings of ore and coal, of upper-lake railways, and of -lake steamers, and prepared to establish its plants for turning out -finished products. Thus was threatened a doubling of the capacity of -production of iron and steel in all of its stages, a capacity already -far beyond that of the markets of the United States. Pools had failed, -and the earlier trusts, aiming at monopolizing each line of the iron -trade, had in the first temporary depression come face to face with -the immediate prospect of ruinous competition among themselves. Then -came the supreme effort at controlling prices through the creation of -the most stupendous corporation that man has yet dared to launch--the -United States Steel Corporation. This combination included most of the -companies of both groups referred to--the producers of unfinished -steel and those transforming the same into the finished product. The -combination formed under the leadership of Mr. J. Pierpont Morgan 230 -controlled two-thirds of the steel output of the country. - -The new company began business in April, 1901, and a comparison of -prices since that date with those of earlier years shows regularity -and steadiness of prices rather than any marked decline or advance. -“This price-steadying,” says J. Russell Smith, “is of incalculable -benefit to the independent manufacturer (as well as to the -combinations) even when it limits the heights to which a price spurt -will go. Rapidly rising prices start a feverish, intoxicated condition -of the market very pleasant while it lasts, but followed by a more -unpleasant reaction; therefore the Trust tries to keep sober and keep -its little brothers sober also, and all are profiting by the new -temperance…. Despite its efforts at control, the Trust is not as -near monopoly as it was the day it began. The four full years of its -operation, 1902-1905, inclusive, did not indicate any increased share -of production. The bulletin of the American Iron and Steel Association -shows that during these four years there was an almost universal -decline in the percentages of iron and steel products made by the -Trust.” - - - - -VI. THE IRON AND STEEL INDUSTRY. - - -The history of the iron and steel industry of the world forms an -excellent example of the recent advance in manufacturing. The -manufacture of iron and steel has made perhaps a more rapid advance -than have many others, and its development is due in such a marked -degree to the use of machinery and the investment of large sums of -capital in the industry that a detailed study of the history and -causes of its development seems justified. - -Pig iron is the basis of all iron and steel manufacturing, in whatever -form, and the record of production of this single article gives at -least a suggestion of the growth in the other lines of the industry, -the growth in production of the finished articles ready for 231 -consumption. The pig iron production of the world in 1800 is estimated -at 460,000 tons; in 1850, 4,422,000 tons; in 1895, 29,300,000 tons, -and in 1903, 46,381,000 tons. The product of 1850 was thus nearly ten -times as much as in 1800, that of 1895, 63 times as much, and that of -1903, 100 times as much as in 1800, while the figures for the year -1907, give a total of 50 million tons or 109 times as much as in 1800. - -Great Britain was the world’s greatest pig iron producer in 1800 and -in 1850. In 1800 she produced 41 per cent of the world’s pig iron, and -in 1850, 50 per cent. By 1895, however, she had begun to take second -place, the United States standing at the head of the list of pig -iron-producing countries at that time, the product of Great Britain -forming 27 per cent of the world’s total and that of the United States -32 per cent. In 1903 the United States showed a still greater lead in -this industry, producing in that year 39 per cent of the world’s total -product; while Germany, which held a low rank as a producer in 1800 -and 1850, actually exceeded Great Britain in 1903, producing 22 per -cent of the world’s total, while Great Britain produced but 19 per -cent of the total. Great Britain’s production grew from 190,000 tons -in 1800 to 8,935,000 tons in 1903; Germany, from 40,000 tons to -10,085,000 tons; the United States, from 40,000 tons to 18,009,000 -tons; and all other countries, from 190,000 tons to 9,352,000 tons. In -1800 the United States produced but 9 per cent of the world’s pig -iron; in 1903, 38 per cent; and in 1907, 41 per cent. - -It will be seen from these figures that the greatest growth in the -world’s pig iron production has occurred in the United States. - -Turning from the comparison of growth in pig iron production in the -leading iron-producing countries of the world and comparing the growth -of the iron industry in the United States with that of other -manufacturing industries, we find that the development in this line 232 -has been greater than that of other leading industries. The census -figures show that the value of the product of the blast furnaces, -steel works and rolling mills of the United States, combined, grew -from 297 million dollars in 1880 to 906 million in 1905, having thus -more than trebled in value in that period, while the value of the -cotton manufactures grew from 211 million to 250 million, having -little more than doubled; that of the woolen and worsted manufactures, -from 194 million to 308 million; lumber and timber products, from 234 -million to 580 million; boots and shoes, from 166 million to 320 -million; leather, from 200 million to 253 million; and flour and -gristmill products, from 505 million to 713 million in the same time. -In the various branches of iron and steel manufacturing there was also -a remarkable growth. Foundry and modern ship products grew in value -from 215 million dollars in 1880 to 800 million in 1905; structural -iron work, from 3½ million to 91 million; and wire and wire work, -from 19 million to 71 million. - -This increase in value of the various classes of iron and steel -products does not by any means show the actual increase in quantity -produced, because of the fall in prices meantime. Practically all of -the important classes of iron and steel products have fallen greatly -in price as the quantity produced has increased. Pig iron, for -example, averaged $33 per ton in 1870, and $18 per ton in 1908; steel -rails, $107 per ton in 1870 and $28 per ton in 1908; bar iron, rolled, -$79 per ton in 1870 and $38 per ton in 1908; and cut nails, 4.4 cents -per pound in 1870 and 2.2 cents in 1908. The iron ore production in -the United States grew from 3 million tons in 1870 to 52 million in -1907; pig iron, from 1.6 million tons to 26 million; and from 69 -thousand tons in 1870 to 23 million tons in 1907. - -Another characteristic of modern manufacturing is exemplified in the 233 -study of the iron and steel industry and the relation of capital, -labor and product, as is also the concentration of industries into -great establishments and groups of establishments. As has already been -noted, the value of the product of the iron and steel blast furnaces, -steel works and rolling mills grew from 297 million in 1880 to 906 -million in 1905, having thus a little more than trebled in that time. -In the same period the capital invested in these same establishments -increased from 231 million dollars to 936 million; the capital having -quadrupled while the product was trebling in value. During the same -time the same establishments increased the number of their employes -from 140,978 to 242,640, the number of employes having therefore -increased but about 75 per cent while the capital was increasing 300 -per cent and the value of the product about 200 per cent. The wages -paid to the employes increased from 55 million dollars in 1880 to 141 -million in 1905; the total wages paid having increased 156 per cent -while the number of employes increased 73 per cent, indicating a -marked increase in wages paid per individual. - -The tendency to concentrate the production of manufactures into great -establishments is also strikingly shown in the record of the iron and -steel industry in the past few years. The census figures show the -number of establishments in the United States in the group, “Iron and -steel, including blast furnaces, steel works and rolling mills” at -1,005 in 1880, 645 in 1890, 668 in 1900, and 605 in 1905. The 1,005 -establishments in 1880 produced 297 million dollars’ worth of the -product; the 645 establishments in 1890 produced 431 million dollars’ -worth; the 668 establishments in 1900 produced 804 million dollars’ -worth; and the 605 establishments in 1905 produced 906 million -dollars’ worth of the product. Thus the average production per -establishment was, in round terms, in 1880, $296,000 worth; in 1890, 234 -$668,000 worth; in 1900, $1,200,000 worth, and in 1905, practically -$1,500,000 worth. This gives an average product in 1905 of 5 times as -much value per establishment as in 1880, while the fact that prices of -1905 were less than those of 1880 indicates that the growth in product -per establishment was even greater than the above figures of value -would suggest. Prices of pig iron, for example, which averaged for -“No. 1 foundry” $28.48 per ton at Philadelphia in 1880, averaged but -$17.88 per ton in 1905; bar iron, rolled, $62.04 in 1880 and $38.49 in -1905; steel rails, $67.52 per ton in 1880 and $28.00 per ton in 1905; -and cut nails, $3.68 per keg of 100 pounds in 1880 and $2.00 per keg -in 1905. It will be seen from these figures that prices in 1905 were -little more than half as much as in 1880 and that the figures which -give an average of five times as much value of product per -establishment in 1905 as in 1880 therefore really indicate an average -product of probably ten times as much in quantity per establishment in -1905 as in 1880. - -That the iron and steel industry is especially suited to production in -large establishments is indicated by the fact that the value of the -product of the steel works and rolling mills of the United States in -1905 averaged nearly four times as much per establishment as that of -those engaged in cotton manufacturing. - -Even these figures of value of product per establishment at the -various dates and in the various industries do not, by any means, -measure the degree of concentration of the industry which has come in -recent years, because of the fact that under the most recent methods, -many of the establishments are managed in groups, many large mills or -factories which were considered by the census as separate -establishments being, in fact, combined under one management, as is -shown in another part of this work in which trusts and combinations -are discussed. - -This tremendous growth of the iron and steel industry of the United 235 -States--of the world, in fact, but more especially of the United -States, seems to justify a somewhat detailed historical and -descriptive account of iron and steel making, ancient and modern. - -The manufacture of iron and steel is older than history. The material -is so widely distributed over the surface of the globe that man in -every part of the world and in nearly every stage of civilization long -since learned its value. There is evidence that it was known to the -Egyptians, the Assyrians, the Chaldeans, the Babylonians, the -Israelites, the Greeks, the Persians, the Romans. Caesar found the -Britons in possession of iron weapons which they had made, and the -Scandinavians of that period were also acquainted with its -manufacture. The people of Spain seem to have been early and -successful workers in iron and steel, if the wonderful stories about -the swords and other weapons of the early history of that country are -to be believed. - -Iron, wherever found in the native condition, is so mixed with rock, -dirt and other foreign matter that it can only be utilized by heating -and hammering or rolling until the pure iron is separated from the -foreign substances. Originally the method seems to have been to heat -the ore in fires built on the ground until it became softened, and by -hammering it in this condition work out the foreign substances. Then -man found that by building the fire in a hole at the top of a hill and -leaving an opening at the bottom so that air could be forced into it, -the heat could be intensified. Then he learned to build up a wall of -mud and stones with an opening at the bottom, and by placing in it -alternate layers of charcoal and iron ore and forcing in air at the -bottom with rude bellows similar to those now used by blacksmiths, he -was able to heat the ore until the iron melted and ran together into a -mass which he worked into the steel with which the famous “Toledo -blades” and other weapons of that early day were made. Later, the 236 -Germans, by building the walls higher and getting a greater mass of -the fuel and ore, were able to melt it so that it ran in liquid form -into little ditches at the bottom of the furnace. This furnace, which -came to be known as the “stuckofen” and “blow oven,” was the precursor -of the blast furnace. Meantime the English were developing the -process, and before the year 1700 were manufacturing considerable -quantities of iron in furnaces in which charcoal supplied heat -sufficient, when a blast of air was introduced, to melt the iron. This -method of manufacturing iron continued in the European countries -during all of the seventeenth century and until the early part of the -eighteenth century. Meantime the forests of England were being rapidly -destroyed in the sections which produced the iron ore. Prior to that -time it had not been found practicable to use coal in smelting the -ore, because the weight of the ore was so great that the fire was -extinguished as the coal grew soft from the heat. Then, in the early -part of the eighteenth century, somebody tried the experiment of -treating the coal in a manner similar to that by which wood is turned -into charcoal, and coke was produced and found available for smelting -the iron ore, the coke being substituted for charcoal. And so the -manufacture of iron in Europe went on, developing most rapidly in -England which had ore, timber from which to make charcoal, and coal -from which to make coke. - -Meantime the making of iron began to develop in the United States. The -early colonists found ore in Virginia and New England. Small -quantities of pig iron were made in Virginia within a few years after -the settlement of Jamestown, and in the latter half of the century New -England began manufacturing iron from bog ore and charcoal made in the -forests which were then so plentiful. Most of these early iron -furnaces were “bloomaries,” merely heating the iron so that it formed -a lump of 100 to 200 pounds weight at the bottom of the furnace, 237 -called a “bloom,” though there were some furnaces which heated the ore -until the iron ran into little channels at the bottom and became “pig -iron.” Before the year 1800 the State of Massachusetts alone had some -75 iron works, chiefly furnaces, making small quantities of iron. A -little later there was built in that state a furnace then declared to -be “the finest in America,” having two bellows twenty feet in length -and operated by a water wheel. During the next century the size of the -furnaces grew slowly and before the year 1800 there were furnaces -capable of making two to three tons of iron per day each. - -The history of the early iron industry in Massachusetts is not -materially different from that of others of the colonies and early -settlements. Connecticut, New York, New Jersey, Pennsylvania, -Maryland, Delaware, Virginia, and the Carolinas all had numbers of -small furnaces capable of making from a half ton to two or three tons -of iron per day. They used charcoal altogether as the fuel, and it was -estimated in Virginia and Maryland that for one furnace of average -size four square miles of woodland and 100 slaves were required. The -fact that there were then no means of transportation other than pack -trains and that iron was too heavy to transport any considerable -distances, encouraged every neighborhood to sustain its furnace and -forge, and from these local factories of pig iron and iron bars the -local blacksmith and others who aided him in supplying local wants -drew their supplies. It is probable that the number of furnaces and -forges in the United States at the beginning of the nineteenth century -was much greater than at the end of the century, though the product of -1800 was but 40,000 tons of pig iron, against 14,000,000 tons in 1900 -and 26,000,000 tons in 1907. - -Meantime the English iron manufacturers had learned to smelt the ore -with coke instead of charcoal. The quantity of wood required to make -charcoal for smelting the ore had been so great that the forests of 238 -England were being rapidly destroyed, and a series of experiments had -developed the fact that by heating coal in a pit or oven, in a manner -similar to that by which charcoal was produced from wood, the charred -coal, called coke, could be used as a substitute for charcoal in iron -furnaces. This substitute for charcoal did not come into use in the -United States until much later, however, for the reason that the -people of the eastern part of the United States were still anxious to -get the timber off their lands to use them for agricultural purposes, -and so were glad to turn it into charcoal and dispose of it to the -iron furnaces at a low cost. In time, however, the supply of charcoal -began to run low and the Americans began to cast about for a -substitute. After a series of experiments it became evident that the -anthracite coal of Pennsylvania could be used for iron smelting, as it -was hard enough to bear the weight of the iron ore piled upon it, and -also made a much more intense heat than did the bituminous coal which -grew soft as it was heated and was useless in the furnace. By 1840 the -making of pig iron with anthracite coal became an established industry -and by 1854 the quantity of iron made by the use of anthracite was as -great as that from charcoal, about 350,000 tons for each. But as the -supply of anthracite was limited to a comparatively small area, those -sections which had no anthracite and had run short of the timber -supply for making charcoal began to cast about for a substitute, and -hearing of the success of the English, with “charred coal,” or coke, -began its use in the United States; and by 1856 there were more than a -score of furnaces making pig iron by the use of coke. It was also -found that if the air which was forced into the furnace was heated -before entering a much more intense heat could be obtained and the use -of the hot blast was soon established. - -With iron being made by the use of anthracite coal and coke made from -bituminous coal, the people began to realize that the destruction of 239 -the forests to produce charcoal should not continue longer, and the -making of charcoal iron rapidly decreased. Meantime the railways began -to develop and were able to carry coal and coke to the places where -the ore could be easily obtained, or to which it could be easily -brought. Such a place was Pittsburg, for example. Iron ore was -produced in certain parts of Pennsylvania and on the northern shores -of the Great Lakes. Coal of a suitable quality for making excellent -coke was produced at Connellsville, in western Pennsylvania. Limestone -is required in great quantities in smelting iron ore, as the alkaline -quality of the limestone neutralizes the acid of the waste matter -forming a part of the iron ore and makes it melt at a lower -temperature, the melted limestone also carrying off the impurities in -the form of “slag,” and limestone was also plentiful near Pittsburg. -Some of these materials could be floated down the rivers or on the -Great Lakes, at least a part of the way from the place of production -to the place at which they were combined, and for the remainder of the -distance railways carried them over comparatively level or down-grade -routes at small cost. - -So, with the advent of the railway and the steamship the methods of -iron making changed. The railway and the river or lake steamer could -carry the finished product at such low cost that it was no longer -necessary that each county should make its own iron, and more than -that, they could carry the ore and the limestone and the coal or coke -to any place convenient for assembling these necessary materials and -distributing the finished product. - -This combination of the raw materials and the manufacture of the iron -in a few great establishments instead of many small ones encouraged -the use of machinery in manufacturing. Machines were wanted for -handling the ore, for handling the coal, for handling the limestone, -for handling the molten material which issued from the furnace, and -for turning it into the finished form, sometimes accomplishing this 240 -without allowing the material to grow cold and harden at any point -between the time it trickles from the blast furnace and its completion -as a steel billet, a rail for the railway, or a roll of barbed wire -for the ranchero of South America. - -The iron as it leaves the blast furnace is not in a condition in which -it can be used for manufacturing. It contains so much carbon and other -impurities that it is brittle and breaks easily. This condition is -similar to that of the “blooms,” or chunks of metal which came from -the early furnaces and which had to be refined by laborious processes -of reheating and hammering until the impurities were worked out. - -Before the year 1800 it had occurred to somebody in England that if -flames could be forced across the surface of the molten iron and the -iron kept in a state of constant agitation the flames would burn out -the carbon. This was accomplished by making an open hearth to contain -the molten material and “puddling” the iron as the flames were forced -across the surface. Then a series of grooved rollers was devised, -between which pieces of partially cooled iron could be passed and -repassed, and this machine process worked out the “slag” and other -impurities which had been formerly worked out with hammers. This -puddling and rolling began in England before the year 1800 and “the -puddle and the grooved roll,” says J. Russell Smith, “closed the era -of the blacksmith’s supremacy and opened the era of machine -manufacture.” It was an adaptation of these methods and combination of -them with the concentration of the material at convenient centers that -proved the beginning of the machine-manufacturing methods in the -United States at a considerably later period than in England. - -The most notable step in developing the use of iron, however, was that -by which it was quickly and cheaply turned into the reliable form -known as “steel.” As already explained, the iron when it leaves the 241 -blast furnace contains such quantities of carbon, silicon, sulphur, -phosphorus, and other impurities that it is brittle and unreliable as -to tensile strength, flexibility, or the qualities which make it -available for edged tools. The puddling process already described -deprived it of the carbon and sulphur, but left it too soft for -immediate use. It required a small and fixed amount of carbon to give -it the qualities of steel and this was replaced by reheating it in -air-tight receptacles in combination with powdered charcoal. By this -process steel was made, but it was a slow and expensive process. About -the middle of the last century, William Kelly, of Pittsburg, conceived -the idea that by forcing air through the molten iron as it came from -the furnace the oxygen of the air would combine with the carbon of the -iron and burn out the carbon, leaving the remainder pure iron. A -series of experiments proved the accuracy of his theory, and he made -steel by this process. About the same time Sir Henry Bessemer, of -England, devised a similar process and it was put into practical -operation in England and later in the United States. By this process, -developed almost simultaneously in America and England by these two -men, the transformation of iron into steel in a brief space of time -and at a small cost was established, and the manufacture of steel -developed with wonderful rapidity. The quantity of steel manufactured -in the United States in 1870 was but 69,000 tons; in 1880, 1,247,000 -tons; in 1890, 4,277,000 tons; in 1900, 10,188,000 tons; and in 1907, -23,363,000 tons. With this great development in manufacturing came a -great development in the use of machinery for handling not only the -finished steel itself but the pig iron from which it was manufactured, -the iron ore from which it was produced and the coal and limestone -used in its production. With this growing use of machinery in the -manufacture and the great increase in the quantity used in the -industries of the world have come the enlargement of the establishments 242 -and the increase in the capital invested described at the opening of -this section. - -This process of burning out the carbon and other impurities from the -molten iron by forcing air and thus combining the oxygen of the air -with the carbon of the iron, although it seems to have been devised -almost simultaneously by Kelly in the United States and Bessemer in -England, is usually denominated the “Bessemer process,” and while -Kelly obtained certain patents and a half million dollars for his -invention, Bessemer also obtained other patents and it is said ten -millions of dollars for his. - -The process of transforming iron into steel by the Bessemer process is -described by Herbert N. Casson in “The Romance of Steel,” as follows: - - “A converter is a huge iron pot twice as high as a man. It is - swung on an axle, so that it can be tilted up and down. Although - it weighs as much as a battalion of five hundred men, it can be - handled by a boy. About thirty thousand pounds of molten iron are - poured into it; and then, from two hundred little holes in the - bottom, a strong blast of air is turned on, rushing like a - tornado through the metal. Millions of red and yellow sparks fly - a hundred feet into the air. - - “The converter roars like a volcano in eruption. It is the - fiercest and most strenuous of all the inventions of man. The - impurities in the iron--the phosphorus, sulphur, silicon and - carbon--are being hurled out of the metal in this paroxysm of - fury. The sparks change from red to yellow; then suddenly they - become white. - - “‘All right!’ shouts the grimy workman in charge. - - “The great pot is tilted sideways, gasping and coughing like a - monster in pain. A workman feeds it with several hundred pounds - of a carbon mixture, to restore a necessary element that has been - blown out. Then it is tilted still farther; its lake of white - fire is poured into a swinging ladle and slopped from the ladle - into a train of huge clay pots, pushed into place by a little 243 - locomotive. The converter then swings up and receives another - fifteen tons of molten metal, the whole process having taken only - a quarter of an hour…. Today there are more than a hundred - Bessemer converters in the United States, breathing iron into - steel at the rate of eighteen billion pounds a year. It is well - worth a visit to Pittsburg to see one of these tamed Etnas in - full blast. Nothing else in the world is like it.” - -Discussing the importance of the discovery of the method by which -common iron is thus cheaply and quickly transformed into steel, J. -Russell Smith, in his “The Story of Iron and Steel,” says: - - “Archaeologists and ethnologists agree that before the dawn of - datable history a milestone of progress was marked when our - ancestors had, at enormous cost, won a pound or so of iron per - capita and begun the iron age. The keen analyst of the present, - seeing our railways, our ships, our cannon, our sky scrapers, has - erected another milestone, and this he calls the Age of Steel. - - “The close of the Civil War found the iron-making world in full - possession of the Bessemer process of converting that metal into - steel…. The variety of uses for this metal is absolutely beyond - enumeration…. Within the space of a generation we have - increased our iron consumption fourfold…. This is the age of - power. Man has changed his economic and social conditions in that - he has harnessed the forces of nature to make them do his work. - Our main dependence, thus far, has been upon fuel, chiefly coal. - The power in the form of the steam generated in the boiler is - kept imprisoned in iron pipes until released in the steel - cylinder, where a steel piston drives forward a steel rod, which - communicates the force to a steel fly wheel, turning on a steel - shaft, and sending the power away to various places where man - wishes to use it. - - “Portable engines, entirely made of iron and steel, are drawn - about the country, or move themselves and carry loads…. The 244 - dynamo rests upon a heavy iron frame and swings its iron arms and - iron magnets through space, whence it mysteriously winds out - power…. The second of the great iron uses is to be found in the - machines driven by the power that man has learned to harness…. - Transport is the third member of the mechanical trinity which - goes with power and machines to make the present epoch. For a - long time the railways consumed half of man’s total iron product. - The street railway of the city is also a heavy consumer. The - elevated railway is nothing but a bridge spanning the city in all - directions, and the subway, its latest rival, is but a steel - tunnel burrowing beneath the ground. In the country, the erection - of the trolley lines is now giving us a second set of railways, - and even the poles are coming to be made of iron. Half a century - ago iron ships began to be common, a quarter of a century ago the - ship-builder turned to steel, and now there is almost nothing - else afloat upon the high seas…. Our structures are becoming - more and more dependent upon the products of the blast furnace - and the steel mills. Our fathers contented themselves with brick - and stone and wood. The limitation of wooden beams and the - cheapness of Bessemer steel caused that material to be used in - heavy structures in a limited way, and as wood increased in value - and knowledge of the use of steel increased, we now see the - modern sky scraper in which wood is eliminated and steel the - absolute essential…. - - “It is therefore natural to expect that the blast furnace should - be among the most thoroughly organized and most highly developed - pieces of mechanism yet devised. It is certainly the most fearful - of all man’s creations, and considering the character of the - process which goes on within it and its unapproachable heat, it - is under a wonderful degree of control. At the present time, the - blast furnaces are a hundred feet high, consist of a great iron - stack lined with some nonfusible material, and when in operation - are filled from top to bottom with roaring fire. Into their 245 - fiery throats are fed alternately small carloads of coke and iron - and limestone, and from the bottom there flows away at intervals - two molten streams--one the precious iron upon which our - civilization rests; the other the useless slag, to be got rid of - in the cheapest possible way…. The burning of this modern - furnace takes place under a forced draught of air blast from - eight to twenty pounds per square inch. This pressure serves to - drive the air upward through the hundred-foot mass which burns - within the furnace. Otherwise, the fire would smother. The gas - which results from the imperfect combustion within the furnace is - a most valuable by-product and serves a valuable purpose in - promoting the furnace operation, and sometimes leaves a product - to sell. A part of the gas is taken to the boilers, where it - generates power for the blowing engines. Another part of it is - used in the so-called stoves to heat the air blast on its way to - the furnaces.” - -The iron obtained by this Bessemer process, by which the carbon and -other impurities are burned out, is, when it leaves the converter and -cools, merely soft, malleable iron, and to transform it into steel -there must be re-inserted a small but fixed and definitely determined -amount of carbon. “Steel,” says J. Russell Smith, “is simply a mixture -of iron with a small amount of carbon, very intimately and evenly -associated in its mass. The carbon content of steel varies from .40 -per cent to 1.50 per cent. Steel making is, therefore, a process of -mixing carbon and iron in proper proportions. Inasmuch as it cannot be -made satisfactorily in a puddling furnace, by reducing the carbon to a -proper point and then stopping the furnace, it has been found -necessary to burn the carbon all out, making wrought iron, and then -working it back to steel by recarbonizing under such conditions that -the carbon can be controlled. The iron, after having all of its carbon -and other impurities burned out by the Bessemer process, is raised to -steel by having thrown into it spiegel iron or ferro manganese. Both 246 -are rich in manganese and carbon. As the iron content of the Bessemer -converter is known and the content of the spiegel iron is known, the -carbon in the steel is under perfect control. The workman watching the -flames cuts off the blast at the moment when the changing color tells -him the carbon is gone. The carbon of the added material makes steel, -and the manganese gives to the steel a toughness needed to make it -stand the strain of being rolled into desired shapes while red-hot, -without breaking…. - - “The steel for the greater industries is shaped in a rolling - mill. It comes from the Bessemer or open-hearth converter molded - into a great billet like a piece of a large wooden beam, and this - billet is carried red-hot to a so-called soaking pit, where the - tongues of a flame from a gas-fire keep it heated until it is - ready to start on its journey through the mills. This soaking pit - is the starting point of many roads through the mill. It goes off - in one direction, and successive rollers squeeze it, crush it, - and lengthen it into steel rails, in which form it emerges a - thousand feet away. Other sets of rolls make the billet into flat - beams for bridges or elevated railways. A third set of rolls, - also starting near the soaking pits, send the product out of the - distant door of the steel mill in the form of great flat plates - to make the boiler of a locomotive, or a marine engine, or the - sides of a steamship, and yet other sets of rollers will make - square rods which finally pass under heavy shears and are chopped - into pieces called billets or blooms. These pieces of steel are - the raw material for other mills which may make wire, nails, or - manufacture steel of any other of a thousand forms. Some billets - are as big as cord wood, some no larger than lead pencils--thus - it passes out into the manifold world of manufacture.” - - - - -VII. THE TEXTILE INDUSTRY. 247 - - -Cotton manufacturing is an important illustration of the growth in the -textile industries of the world during the period in which the use of -machinery has multiplied the producing power of man in the industrial -lines. In all lines of textile manufacture the growth has been rapid, -but especially so in cotton, which has made greater gains in the work -of supplying man with the necessary requirements of life, in clothing -for his body and the comforts of life, than other branches of the -textile industries and than many other branches of manufacture. -Mulhall estimates the consumption of cotton by all nations at 303 -million pounds in 1800 and 5,900 million pounds in 1896; wool, 460 -million pounds in 1800 and 2,400 million pounds in 1896; flax, 600 -million pounds in 1800 and 200 million pounds in 1896; silk, 30 -million pounds in 1800 and 50 million pounds in 1897. It will be seen -from these estimates that the growth in consumption of cotton has been -far in excess of that of any other of the important fibers. Cotton -consumption in 1896 was, according to these figures, 5,900 million -pounds, against 303 million in 1800, or practically 20 times as much -in 1896 as in 1800, while wool consumption is set down at 2,400 -million pounds in 1896, against 460 million in 1800, or only about 5 -times as much in 1896 as in 1800; while in the other materials used in -textile manufactures the growth has been much less than that of -cotton. - -Before entering upon a discussion of the growth in cotton -manufacturing and the causes thereof, it is proper to say that the -value of all textile manufactures in the principal countries of Europe -has, according to Mulhall, grown from £96,000,000 in 1800 to -£660,000,000 in 1896, and in the United States, from £3,000,000 in -1800 to £188,000,000 in 1896, the value of textile manufactures -produced in Europe having thus increased about sixfold in the period -in question, and in the United States about sixtyfold. It is apparent -from these figures that the growth in the manufacture of cotton 248 -during the last century has far outstripped that of any other of the -textiles. It is also quite apparent that the capital invested in -cotton manufacturing is much greater than that in other textiles. The -United States Census reports the capital invested in the manufacture -of cotton goods in 1880 at 320 million dollars; in 1905, 613 million; -the value of the products of these manufacturing establishments in -1880, 211 million dollars, and in 1905, 450 million dollars. Even -these figures of increased production--from 211 million dollars’ value -in 1880 to 450 million in 1905--do not fully indicate the increase in -quantity of products, since prices in 1905 were materially less than -those of 1880. The average price of standard sheetings in the New York -markets was quoted at 8½ cents per yard in 1880 and 7 cents per -yard in 1905; of standard drillings, 8½ cents per yard in 1880 and -7 cents per yard in 1905; of New York mills bleached shirtings, 12¾ -cents per yard in 1880 and 9 cents per yard in 1905; of standard -prints, 7.4 cents per yard in 1880 and 4¾ cents per yard in 1905; -and of 64 by 64 printing cloths, 4½ cents per yard in 1880 and 3.6 -cents per yard 1905. This indicates that the increased valuation in -cotton products from 211 million dollars in 1880 to 450 million -dollars in 1905, fails to fully reflect the increased quantity -produced in 1905, and suggests that the quantity produced in 1905 was -probably approximately three times as great as in 1880. - -The disposition to increase production through enlargements of -existing factories rather than by the establishment of new ones, or -the combination of existing factories as an offset to the -establishment of new ones, is indicated by the fact that the total -number of establishments, which was reported in 1880 at 1,005, was, in -1905, but 1,154, an increase of about 12 per cent in the number of -establishments, while capital was increasing nearly 200 per cent, the -value of product more than 100 per cent, and quantity of product 249 -probably nearly 200 per cent. - -Great Britain is in proportion to population the greatest -cotton-manufacturing country of the world. She was earliest in the -field as a manufacturer, developing that industry while the countries -of continental Europe were engaged in wars and while the United -States, now the leading producer of cotton, was developing her -agricultural industries and had scarcely as yet entered upon the -development of her manufacturing possibilities. The United States, by -far the largest producer of raw cotton, ranks second as a manufacturer -of cotton goods. - -Accurate estimates of the relative standing of the various countries -in the manufacture of cotton are difficult, almost impossible, -especially in view of the fact that no country other than the United -States takes a periodic census of its industries. There are, however, -three ways by which the production of cotton manufactures in the -various countries can be approximately measured: first, by the number -of spindles in cotton mills; second, by the quantity of cotton used; -and, third, a method which has been suggested in some quarters, a -measurement of the quantity or value of cotton goods exported. This, -however, would not give at all an accurate picture of the quantity -produced, since the population of the cotton-manufacturing countries -varies so greatly and, what is more important, the habits of life, the -climatic conditions, and therefore the quantities of cotton cloths and -cotton manufactures of various sorts used by their respective -populations renders the third method of estimate of little value. Even -the first and second methods mentioned--the determination of the -number of spindles and the determination of the quantity of cotton -used--do not, by any means, give an accurate picture of the relative -quantity or value of cotton goods manufactured. In the United States, -where cotton is plentiful, much larger quantities of cotton are used -per spindle than in the European countries, and greater quantities 250 -of cotton are also used for each 100 yards of cotton manufactured than -is the case in other countries. This is due, in part, to the fact that -the manufacturers of the United States are producing cotton goods for -their home population, living in a temperate zone climate and -requiring, therefore, heavy cottons; while many of the factories of -Europe are manufacturing for exportation to tropical countries, where -cottons of very light weight are required. As a consequence, the -European manufacturers use a less quantity of cotton per spindle and a -less quantity of cotton per square yard of product than is the case -with the manufacturers of the United States. The number of spindles in -cotton mills in Great Britain is estimated at 44½ million in the -season 1896-7 and 52 million in 1906-7, an increase of 16¾ per -cent; in continental Europe, 30⅓ million in 1896-7 and 35¾ -million in 1906-7, an increase of 18 per cent; in the United States, -17¼ million in 1896-7 and 25¾ million in 1906-7, an increase of -50 per cent; and in India, 4 million in 1896-7, and 5⅓ million in -1906-7, an increase of 33 per cent. The annual consumption of cotton -in cotton mills is estimated, in Great Britain, 3¼ million bales of -500 pounds net in 1896-7, and 3-9/10 million bales in 1906-7, an -increase of 21 per cent; in continental Europe, 4⅓ million bales in -1896-7, and 5½ million bales in 1906-7, an increase of 44 per cent; -in the United States, 2¾ million bales in 1896-7, and 4-5/6 million -bales in 1906-7, an increase of 77 per cent; and in India, 1 million -bales in 1896-7, and 1½ million bales in 1906-7, an increase of 50 -per cent. - -It will be noted that although the number of spindles in the cotton -mills in the United States was but 25¾ million, against 52 million -in Great Britain, or about half as many in the United States as in -Great Britain, the quantity of cotton used in the United States was -greater than in Great Britain, being 4,822,000 bales, against 251 -3,915,000 bales in Great Britain. - -The textile industry of the United States, according to census -reports, represented in 1900 investments amounting to 1,043 million -dollars, employed 661,000 wage-earners, paid 209 million dollars per -annum of wages, used 521 million dollars’ worth of materials, and -turned out products valued at 931 million dollars. The number of -establishments was 4,312. Cotton manufactures formed a larger share of -these enormous totals, both as to investment, wages paid, and value of -products, than did any other of the manufacturing industries included -under the general term of textiles. The value of cotton manufactures -in 1900 was 339 million dollars, while that of wool manufactures was -297 million; silk manufactures, 107 million; hosiery; and knit goods, -95 million; and flax, hemp and jute manufactures, 48 million. Adding -to this 45 million for dyeing and finishing of textiles, the value of -the combined textiles in 1900 is set down at $931,494,566. - -“Textiles,” or “textile fabrics,” may be properly described as stuffs -made by weaving together of threads of any sort to produce a material -with a nearly solid surface. “A fishing net,” says the Encyclopedia -Americana, “is not a textile, because the cords which compose it are -not woven together but merely cross one another at equally distant -intervals and are strongly knotted at those points. But -mosquito-netting is a textile, although very open, because the threads -are merely held by their own friction.” Textiles in the usual sense -are made of the twisted fibers spun into thread of flax or linen, -cotton, hemp, jute, silk or wool, woven together by the use of a loom. -“The general nature of a loom,” says the above quoted authority, “is -that the threads of the warp are divided into two sets, one of which -is thrown upward, while the other is thrown down, and at the same -moment a shuttle carrying a thread of the woof is driven through -between the two sets of warp threads. The next movement of the loom 252 -reverses the two sets of warp threads, throwing the upper one down and -the lower one up, compressing and drawing tight the woof thread into -the loops which show on the surface of the stuff and go to form the -surface, and the shuttle is driven through again in the opposite -direction. The constant repetition of this forward and backward -movement of the shuttle gives a strip of woven fabric which constantly -grows: and as each movement of the shuttle is made, an appliance -drives the last thread of the woof back against the others, so that -this growing strip of woven stuff is kept at a uniform state of -firmness and solidity. It is in this way that the simplest fabrics of -linens and cottons are made. If it be desired to produce a somewhat -more elaborate weave, this is done by raising two threads of the warp -and dropping one; or by raising three threads of the warp and dropping -one, and so on. In this way the threads of the woof are seen lying in -loops, or what seems to be stitches longer than those of the simplest -weave…. If we take a step further and use three or four warp -threads, say, of red, while the rest remain white, and do the same -thing with the woof threads, we produce stripes and where these -stripes cross one another there will be a little square of the solid -color of the three or four threads, while the stripes elsewhere remain -of the half-way tint…. In such weaving of patterns it is here -assumed that the threads are dyed before the weaving is begun. The -matter of printing colors upon calico, thin silk, or the like, is -entirely apart from consideration of the textile fabric. Printing is -done from blocks (or rolls) with color almost exactly as if the -material receiving the pattern were paper instead of a woven stuff.” - -The above description of the method of producing textiles is -sufficiently elaborate for a study of this character. The methods of -producing brocades, satins, velvets and other elaborately figured -textiles of any sort may be studied more in detail by reference to 253 -any standard encyclopedia or work of this character. - -The fact that cotton is, as has been already shown, the most important -of the textile industries, utilizing larger sums of capital, turning -out greater values of product, distributing its products over a wider -area and to a larger number of people than any other of the textiles, -justifies a somewhat more elaborate discussion of this industry and -its development during the period in which the manufacturing -industries of the world have been transferred from hand labor to that -of machines, and in which capital has come to form so important a -factor in production. - -The manufacture of textiles from cotton is, like that of iron and -steel, “older than written history.” The art of cotton spinning and -weaving is believed to have been practised in India, still a great -cotton-producing section of the world, from 20 to 30 centuries ago. -From India the production of cotton and manufacture of cotton goods -moved westward into Persia, thence to the area immediately east of the -Mediterranean, then to Egypt, and even southern Europe. The Moors are -said to have introduced the cultivation and manufacture of cotton into -Spain during their control of that section of Europe, but the -cotton-manufacturing industry which existed at Seville, Cordova and -Grenada fell into decay after their expulsion from Spain and was only -resumed after the British, followed by the French and Germans, had -developed the art of manufacturing cotton goods by machine methods. -While the manufacture of yarn or threads from cotton declined in -Spain, it later made its appearance in Italy in the fourteenth century -and in Germany, Prussia, the Netherlands and England in the sixteenth -century, and France in the seventeenth century, but it was not thought -practicable to manufacture cloth exclusively from cotton until toward -the close of the eighteenth century, the cotton yarn being used only -for woof, while the warp used in conjunction therewith was either 254 -wool, flax, or silk. The so-called “Manchester cottons” of earlier -date were composed in part of cotton and in part of wool or linen. The -first acquaintance of western Europe with cloths made entirely from -cotton seems to have been in those brought from Calcutta, India (and -therefore called calicoes); but the calicoes made in Europe at that -time and for more than a century after were made, in part at least, of -wool or linen. - -Prior to the latter part of the eighteenth century all cloths, whether -of wool, cotton, silk, or flax, were manufactured by hand labor. The -natural fabrics were, as described elsewhere in this work, spun into -threads by the use of the simple spinning wheel, chiefly by the labor -of women who were termed “Spinsters.” The threads thus obtained were -made into cloth by the use of a loom upon the general principles above -described, but of extremely simple design and operated solely by human -power. Up to this time the making of threads or yarn and their -transformation into cloth by the weavers, chiefly men, kept pace -fairly with one another, the supply of thread or yarn being about -equal to the demand by the weavers. “One good weaver,” says Dr. Ure, -“could keep three active women at work spinning weft. In operating the -loom, the shuttle which carried the thread back and forth between the -raised and lowered sections of the warp was thrown back and forth with -the hand, which required a constant extension of the hands to each -side of the warp. In 1738 John Kay, an Englishman, devised a system by -which the shuttle was thrown back and forth by means of strings -attached at opposite ends of the lathe in which the shuttles ran, -enabling a weaver to double the amount of cloth which he could -manufacture within a given space of time, thus making the demand for -yarn in excess of the supply.” “It was no uncommon thing,” says a -writer on that subject, “for a weaver to walk three or four miles in a -morning, and call on four or five spinners, before he could collect 255 -weft to serve him for the remainder of the day.” - -This stimulated active minds in those industries to devise some method -for increasing the facilities for turning the wool or cotton or flax -into the needed yarn, and James Hargreaves, a weaver, devised about -1764 a machine which he called the “spinning jenny,” in which were set -eight spindles in a frame put in motion by a single wheel, and by -moving backward and forward a moveable carriage containing a -horizontal clasp to hold the material being twisted into threads, the -quantity of yarn which one person could produce in a given length of -time was greatly increased. Subsequently the number of spindles in the -frame was increased to 20 or 30, and in time to more than 1,000. -Hargreaves kept this invention secret for a time, using it merely to -manufacture yarn for his own weaving, but it finally became known and -the spinners of the neighborhood, believing that it would throw many -out of employment, broke into his establishment and destroyed the -machine. He, however, retired to Nottingham, erected a small mill and -took out a patent for the “spinning jenny,” and in time it became to -be an established method of manufacturing yarn and in a more elaborate -form is the principal factor in the manufacture of cotton yarns in the -great factories today, the number of spindles which a modern machine -of this character now uses being often in excess of 1,000, instead of -the 8 utilized by the original spinning jenny. - -Meantime another method was being utilized and brought into operation, -by which a stronger yarn could be produced. It seems to have been -originally devised by John Wyatt, of Birmingham, England, and operated -upon a system entirely different from that of the jenny. “The method -adopted,” says Ellison, in his “Cotton Trade of Great Britain,” “was -to pass the cotton through pairs of small grooved rollers placed -horizontally, the upper and lower roller of each pair revolving in 256 -contact, the sliver of cotton, after passing through these rollers, -being caught by another pair of rollers placed immediately in front -which revolve with three, four, or five times the velocity of the -first pair and therefore draw out the sliver of cotton into three, -four, or five times its former length and degree of fineness. After -passing through this second pair of rollers it was attached to a -spindle, the rapid revolutions of which twisted it into a thread and -at the same time wound it upon a bobbin.” This method, devised by -Wyatt in 1730 and patented in 1738, was perfected by Arkwright 30 -years later and was known as the “spinning frame,” but since it was -operated by water power, received the name of the “water frame.” By -the use of this process the cotton yarn was made of sufficient -strength to permit its use for the warp as well as for the woof, and -thus, for the first time, the making of cloth entirely from cotton -became practicable. - -“With the invention of the jenny and water frame,” says Ellison, -“commenced a new era in the history of the cotton trade; in fact, so -far as Europe is concerned, it may be said that the history of the -cotton manufacture, as a separate and distinct industry, began with -the invention of these two machines; for until the introduction of -Arkwright’s contrivance for spinning by rollers, it was impossible to -produce a piece of cloth composed wholly of cotton.” - -Still another important device for use in the manufacture of cotton -cloths was the “carding machine.” Originally the raw cotton was -prepared for spinning by the use of brushes made of short pieces of -wire instead of bristles, the wire being stuck into a sheet of leather -at a certain angle, the cotton being spread upon one piece and combed -with another until the fibers were laid straight, when it was ready -for the use of the spinner. In 1748 a carding machine was devised to -supersede the hand process, but it was not until toward the close of 257 -the century that carding machines took such form as to become an -important factor in the cotton-manufacturing industry. Even in the -closing quarter of the eighteenth century the prejudice on the part of -hand laborers against machines was so great that for several miles -around Blackwell every spinning jenny containing more than 20 spindles -was destroyed, while a mill erected by Arkwright near Chorley was -destroyed by a mob. A little later another machine was invented by -Samuel Crompton, which he designated the “spinning mule,” which -combined the drawing rollers of Arkwright and the jenny of Hargreaves; -and it was looked upon as an improvement upon the machines of -Arkwright and Hargreaves. These devices--the spinning jenny of -Hargreaves, the water frame of Arkwright, and the combination of those -principles in the spinning mule of Crompton--revolutionized the -cotton-manufacturing industry and the principles thus embodied are -still the chief factors in the great cotton-manufacturing -establishments of the world today. - -Another device which added greatly to the manufacturing possibilities -with reference to cotton was the invention by Eli Whitney in America -of the cotton gin, a machine for stripping the cotton fiber from the -seeds and technically called the “gin,” probably a contraction of the -word engine. It performs its work through the operation of a series of -revolving saws which come in contact with the cotton through openings -sufficiently narrow to prevent the passing of the seeds but permitting -the fibers torn therefrom to pass downward into a receptacle, while -the seeds, freed from the fiber, pass through another opening and are -subsequently utilized in the manufacture of oil; though this -utilization of the seeds did not develop until long after the cotton -gin had become an important factor in the cotton-manufacturing -industries of the world. - -Through the application of these machines--the spinning jenny, the 258 -water frame, the spinning mule, and the cotton gin, driven by power -generated by water or steam, and in more recent years applied, in some -cases in the form of electricity--the cotton manufacturing of the -world has been transferred from hand work to that of machines, and the -world’s consumption of cotton today is many times as much as that of -the period in which these machines were being perfected, while the -quantity of cotton goods produced from a given amount of cotton is, -through the refinement of machine processes, much greater than -formerly. The quantity of cotton cloth produced at the present time -through the development of machinery and the encouragement which its -use has given to production of cotton and consumption of cotton goods -multiplies many times that of the period in which the transformation -from hand to machine production began, and has made cotton the leading -textile material of the world. - -True, other branches of the textile industry have also benefited by -the application of machine methods of spinning and weaving similar to -those above described; but no other important textile has seen such a -remarkable growth under the stimulus of machine production as has -cotton. Even as late as 1830 the cotton consumed by those sections of -the world for which statistics are available only amounted to about -500 million pounds, against 8,500 million in 1907, while, as already -indicated, a pound of cotton under present conditions of manufacture -produces probably twice as much of a given line of manufactures as a -century ago. When it is remembered that the population of the world -has only doubled since 1830 and the consumption of cotton is 17 times -as great as at that time, the relative growth of cotton consumption to -population will be seen to have been very great. - -The above figures relating to consumption of cotton and to comparison -of present consumption with that of a century ago relate chiefly to 259 -Europe and the United States. Statistics of consumption are available, -in addition to Europe and the United States, for India and Japan, and -a few communities in which the consumption is small, such as Canada, -Mexico and Australia. In addition to this, however, it must be -remembered that large quantities of cotton goods are still being -manufactured in certain parts of the world by the crude processes -which prevailed in Europe and the United States before the adoption of -the machine methods above described. In China, for example, large -quantities of cotton are turned into yarn by hand spinning, and into -cloth by hand weaving, and there is reason to believe that the -quantity of cotton cloth manufactured in China by hand weaving, partly -from yarns spun by hand and partly from yarns manufactured by machine -methods, is greater than that manufactured by modern machinery. In -many of the oriental countries, in large portions of South America, in -large sections of Africa, and in the islands of the Pacific, millions, -hundreds of millions of people are still clothed with textiles--cotton, -wool, silk, or fibers--manufactured by hand processes or by simple -machines operated by man power. In Europe and the United States, -however, the system has been completely transformed, and machinery and -money, in combination with a steadily decreasing percentage of human -labor, now manufacture the cotton goods worn not only by their own -people, but by large sections of the inhabitants of the oriental -countries and the continents of Africa, South America and Australia. - -The relative growth in the manufacture of cotton in recent years by -the principal countries in which this industry has developed is -indicated by the fact that the quantity of cotton consumed in Great -Britain in 1887 was 2,955,000 bales and in 1907, 3,900,000 bales; that -of the continent of Europe, in 1887, 2,912,000 bales, in 1907, -5,460,000 bales; in the United States, in 1887, 1,939,000 bales, in 260 -1907, 4,950,000 bales; in India, in 1887, 569,000 bales, in 1907, -1,600,000 bales; in Japan, in 1892, the first year for which -statistics are available, 99,000 bales, and in 1907, 925,000 bales; -and in all other countries for which figures are available, in 1891, -106,000 bales, and in 1907, 171,000 bales. - -With this elaborate use of machinery and increase of cotton -production, manufacture and consumption, has come great reduction in -cost of production and in prices. “In the last half of the nineteenth -century,” says S. N. D. North, late Director of the Census, in the -Encyclopedia Americana, “there was an increase in value of textile -products in the United States of about six times and not less than ten -times if it were possible to measure this product by quantity instead -of by value. Even the largest figures convey an inadequate idea of the -relative importance of our textile mills in the industrial economy of -the nation, for those mills supply the materials for a great group of -subsidiary factory industries, such as the wholesale clothing -manufacture, etc. When we aggregate these, and add to them the value -of the products of the linen, jute, hemp, and bagging mills of the -country, we find that the product of our textile mills is larger in -value than that of any single line of related industries, iron and -steel excepted. The decrease in the cost of goods during the last half -of the century has been one of the most striking phases of the -development. This decrease is due--in some measure, of course, to the -decreased price of the raw materials, but in even larger measure to -the remarkable advance in methods of manufacture--to the new and more -perfect machinery employed, in the invention of which American -mechanical genius has contributed certainly as much as that of any -other people, and perhaps more. All the fundamental inventions in -spinning-machinery were of English origin. The French and Germans have -also done much in the invention of labor-saving textile machinery, -but the American record may be shown to have surpassed them all. 261 -The wool-carding machinery of all countries owes its chief improvement -over the machines of a century ago to the invention of John Goulding, -of Worcester, Mass. The modern cotton spindle, making 10,000 -revolutions a minute, is an evolution of our own mechanics, and the -saving effected by new forms of spindles invented and adopted in the -United States since 1870, when 5,000 revolutions per minute was the -average speed, has been more than equal to the capacity of all the -warp-spinning machinery in use in this country in that year. In -structural equipment, the modern American mill,” continues Mr. North, -“is, in some respects, superior to the average foreign mill. It is not -so massive a structure, nor so solidly built, brick being used here -while the English usually use stone; and in the lightness and airiness -of its rooms, in economy of arrangement and general completeness of -equipment and care for the comfort and convenience of the operatives, -it is usually superior. While many parts of the machinery required for -the equipment of our textile mills are still necessarily imported from -England because not made, or less perfectly made, in the United -States, our machine manufacturers have been advancing as rapidly in -recent years as the textile mills themselves, and the time cannot now -be far distant when every new mill built in America will be equipped -throughout with American-made machinery. The American textile mills -now supply practically every variety of fabric made in the world, with -the exception of linens and the very finest grades of other fabrics.” - -The Census of 1905 shows the value of cotton manufactures of the -United States in 1850, 62 million dollars; in 1860, 115 million; in -1880, 192 million; in 1900, 331 million; and in 1905, 442 million; the -capital invested in 1850, 75 million dollars; and in 1905, 605 -million; the wages paid in 1860 (no figures for 1850), 24 million -dollars; in 1905, 94 million; the number of wage-earners in 1850, 262 -122,000; in 1905, 310,000; the number of spindles, in 1860, 5¼ -million; in 1905, 23 million; the number of looms, in 1860, 126,313; -in 1905, 540,910; the cotton consumed, in 1860, 423 million pounds; in -1905, 1,873 million pounds. - -A marked characteristic of the cotton industry of the United States in -recent years has been the gradual movement of the industry away from -New England, where it was originally established, toward the -cotton-producing section, the South. The number of cotton-manufacturing -establishments in the New England States fell from 439 in 1880 to 308 -in 1905, while those in the South increased from 161 to 550 in the -same time. The number of spindles as shown by the Bureau of Statistics -of the Department of Commerce and Labor, in the Northern States as a -whole, increased from 10 million in 1880 to 17⅓ million in 1908, while -those in the Southern States increased from a little over a half -million in 1880 to over 10 million in 1908. In the principal -cotton-manufacturing countries of the world the increase in spindles -during the last decade has been as follows: Great Britain, from 44½ -million in 1897 to 52 million in 1907; continental Europe, from 30⅓ -million in 1897 to 36 million in 1907; the United States, from 17 -million to 25¾ million; India, from 4 million to 5⅓ million; and -Japan, from a half million to a little over 1½ million. The 36 million -cotton spindles in continental Europe are, according to Ellison, -distributed as follows: Germany, 9 million; Russia and Poland, 7 -million; France, 6 million; Austria-Hungary, 3¾ million; Italy, 3 -million; Spain, 2¾ million; Switzerland, 1½ million; Belgium, 1⅓ -million, and the remainder distributed among Switzerland, Holland, -Portugal and Greece. - - - - -VIII. THE MANUFACTURING INDUSTRIES OF THE UNITED STATES. 263 - - -The fact that this story of the world’s manufactures is intended -primarily for the information of people of the United States, coupled -with the further fact that the United States is itself the world’s -largest producer of manufactures, seems to justify a somewhat detailed -study of the manufactures of this country, the growth of the -manufacturing industry, and especially the part which they bear in our -foreign commerce. Originally the United States, like all new -countries, devoted its attention chiefly to agriculture. The products -of the soil are man’s first requirements. He must have food. When he -obtains food his next thought is of clothing, but that he can obtain -temporarily from the skins of the beasts whose bodies supply him with -food. So the production of manufactures was of secondary importance in -the early development of that part of the North American Continent -which is now known as the United States. The eastern part of the area -being densely wooded, the work of the first and second and third -generations of our forefathers was to fell the trees and prepare the -ground for agriculture for the production of the wheat and corn and -other foodstuffs which they must have to sustain life. If there came -as a result a given quantity of potash and pearlash and leather and -other manufactures of this crude type which could be utilized by the -people or exported to foreign countries they accepted this thankfully, -but made no special effort to develop the manufacturing industry. -During the colonial days little effort was made in the development of -manufacturing, except to supply the household requirements. The -housewife spun and wove the wool and flax into threads and cloth, and -a large part of the population was clothed in “linsey-woolsey,” -produced in this manner. Even during the period of the Confederation, -which immediately followed the Revolutionary War, conditions in the 264 -manufacturing industries did not materially change and nobody seems to -have thought them of sufficient importance to justify any governmental -attention or action. Shortly after the adoption of the Constitution, -however, Alexander Hamilton, the first Secretary of the Treasury, -submitted to the Congress of the United States, in 1791, a “Report on -Manufactures,” which pictured manufacturing conditions in this country -at that day. He enumerated some 17 industries which had “grown up and -flourished with a rapidity which surprises, affording an assurance of -success in future attempts.” These 17 industries were as follows: - -1. Skins.--Tanned and tawed leather, dressed skins, shoes, boots and -slippers, harness and saddlery of all kinds, portmanteaus and trunks, -leather breeches, gloves, muffs and tippets, parchment and glue. - -2. Iron.--Bar and sheet iron, steel, nail rods and nails, implements -of husbandry, stoves, pots and other household utensils, the steel and -iron work of carriages, and for shipbuilding, anchors, scale beams and -weights, and various tools of artificers, arms of different kinds; -though the manufacture of these last has diminished for want of a -demand. - -3. Wood.--Ships, cabinet wares and turnery, wool and cotton cards and -other machinery for manufacture and husbandry, mathematical -instruments, coopers’ wares of every kind. - -4. Flax and hemp.--Cables, sail cloth, cordage, twine and pack -thread. - -5. Bricks and coarse tiles and potters’ wares. - -6. Ardent spirits and malt liquors. - -7. Writing and printing paper, sheathing and wrapping paper, -pasteboard, fullers’ or press papers, paper hangings. - -8. Hats of fur and wool and mixture of both, women’s stuff and silk 265 -shoes. - -9. Refined sugars. - -10. Oils of animals and seeds, soap, spermaceti and tallow candles. - -11. Copper and brass wires, particularly utensils for distillers, -sugar refiners and brewers; andirons and other articles for household -use, philosophical apparatus. - -12. Tinware for most purposes of ordinary use. - -13. Carriages of all kinds. - -14. Snuff, chewing and smoking tobacco. - -15. Starch and hair powder. - -16. Lampblack and other painters’ colors. - -17. Gunpowder. - -In addition to the industries above enumerated, which were carried on -as regular trades in many localities, Mr. Hamilton went on to -describe--“a vast scene of household manufacturing, which contributes -more largely to the supply of the community than could be imagined -without having made it an object of particular inquiry--” and he -continues-- - - “Great quantities of coarse cloths, coatings, serges and - flannels, linsey-woolseys; hosiery of wool, cotton and thread; - coarse fustians, jeans and muslins; checked and striped cotton - and linen goods; bed ticks, coverlets and counterpanes; tow - linens; coarse shirtings, sheetings, toweling and table-linen, - and various mixtures of wool and cotton, and of cotton and flax - are made in the household way and, in many instances, to an - extent not only sufficient for the supply of the families in - which they are made, but for sale, and even, in some cases, for - exportation. It is computed in a number of districts that - two-thirds, three-fourths and even four-fifths of all the - clothing of the inhabitants are made by themselves. The - importance of so great a progress as appears to have been made in - family manufactures within a few years, both in a moral and 266 - political view, renders the fact highly interesting. Neither does - the above enumeration comprehend all the articles that are - manufactured as regular trades. Many others occur, which are - equally well established, but which, not being of equal - importance, have been omitted. And there are many attempts, still - in their infancy, which, though attended with very favorable - appearances, could not have been properly comprised in an - enumeration of manufactories already established. There are other - articles, also, of great importance, which, though, strictly - speaking, manufactures, are omitted as being immediately - connected with husbandry, such as flour, pot and pearl ashes, - pitch, tar, turpentine and the like.” - -The “manufactories carried on as regular trades,” and included in Mr. -Hamilton’s category, says the U. S. Census Report of 1900, comprised -such as would naturally spring up in a new country to supply the -immediate necessities of the inhabitants, together with those whose -materials were most abundant and inviting. Agricultural implements and -other tools of industry were made in quantities fully equal to the -demand. Firearms were also made. The dressing of skins, especially -tanning, had become an important industry, and was carried on both in -establishments exclusively devoted to the purpose, and by many -shoemakers and farmers as a subsidiary occupation. The number of -brewers and distillers was remarkable, and nearly the entire domestic -demand for beverages was supplied by home production. Sawmills, -gristmills, brick kilns, wool-carding mills, and fulling mills existed -in great number, but always on a small scale, supplying only local -needs. The manufacture of paper, which had been a successful colonial -industry, also supplied the domestic requirements, and several glass -works existed. “Iron works have greatly increased in the United -States,” said Mr. Hamilton, “and are prosecuted with much more -advantage than formerly.” The shipbuilding industry was particularly 267 -well developed and widespread. In 1793 the tonnage of the United -States exceeded that of every other nation except England. In the -main, however, the people had confined themselves to such manufactures -as could not be imported to advantage. Foreign goods, chiefly -textiles, were largely imported in exchange for agricultural products. - -Such was the general condition of our manufactures at the opening of -the nineteenth century. Although some progress in this direction has -been made, the occupations of the people were chiefly agricultural; -commerce was becoming a factor of constantly increasing importance in -the development of the industrial resources of the country, while -manufactures occupied the third and subordinate position. - -In 1810 Albert Gallatin, Secretary of the Treasury, in response to a -resolution of the House of Representatives of June 7, 1908, made a -report which is an admirable summary of the condition of American -manufactures at that date. Secretary Gallatin estimated that in 1809 -the value of the products of American manufactures exceeded -$120,000,000. Tench Coxe’s estimate, based upon the returns obtained -at the Census of 1810, was $198,613,471. The censuses of 1810, 1820, -1830 and 1840 gave certain figures on the manufacturing industries of -the United States, but they did not approach the completeness of the -censuses of recent years, and the figures of those earlier records -must be accepted only with this view of their incompleteness. Tench -Coxe, as already shown, estimated the real value of the manufactures -of 1810 at a little less than 200 million. The censuses of 1820 and -1830 were confessedly incomplete and their showing of manufactures -does not compare favorably with the Coxe estimate for 1810. In 1840 -the value of the manufactures was put at about 500 million dollars; in -1850, at one billion; in 1860, a little less than 2 billion; in 1870, -4¼ billion; in 1880, 3⅓ billion; in 1890, 9⅓ billion; in 1900, 13 268 -billion; and in 1905, 16 billion--a sum three times the estimated -value of manufactures of the next great manufacturing nation, the -United Kingdom. - -It must be remembered, however, that these figures of the value of the -manufactures of the United States are “gross values,” or, in other -words, contain many duplications, as explained elsewhere, and that the -net or real value of the manufactures of the country was but -two-thirds of the figures above named. Even this estimate which puts -the net or true value of the manufactures of the country at about -two-thirds of the census gross valuation still leaves the United -States so far in the lead that there can be no doubt that it is the -greatest manufacturing nation of the world. Tables printed elsewhere -in this text show that her production of manufactures is, even under -an acceptance of the “net” value and an exclusion of certain articles -not classed as manufactures by other countries, far in excess of that -of any other country. - -The growth by industries cannot be shown in detail in a work of this -character. Suffice to say that every line of manufactures is now -produced in the United States, save only those in which the work is -wholly, or chiefly, performed by hand labor. The growth of the more -important industries, such as iron and steel, textiles, etc., is -pictured in sections devoted to those industries, and an outline of -the growth in the principal articles is shown in the table on another -page which presents official figures of the number of factories, -persons employed, capital invested and product turned out in the -principal manufacturing industries of the country in 1880, 1890, 1900, -and 1905. - -The increase in the production of manufactures in the United States, -far in excess of home requirements, has forced our manufacturers to -seek markets in other parts of the world for their surplus product. -The result has been a rapid increase in the exportation of -manufactures. The total value of manufactures exported from the United 269 -States has grown from less than 8 million dollars in 1820 to 23 -million dollars in 1850, 48½ million in 1860, 70 million in 1870, 122 -million in 1880, 179 million in 1890, and 485 million in 1900, since -which time the annual total has not fallen below the 400-million-dollar -line, while in the year 1908 the total exceeded 750 million dollars. -In the fiscal year 1908, the latest period for which detailed figures -of the exports by countries are available, the exports of manufactures -were valued at 750 million dollars, of which 368 million dollars’ -worth went to Europe, 188 million to North America, 72 million to -South America, and 71 million to Asia, while the remainder was divided -between Oceania and Africa. - -That this growth has been especially marked in recent years is shown -by the fact that the actual increase by decades in exports of -manufactures has been as follows: During the decade ending with 1830, -1.8 millions; 1840, 5.8 millions; 1850, 7.8 millions; 1860, 25.2 -millions; 1870, 21.6 millions; 1880, 51.8 millions; 1890, 57.2 -millions; 1900, 305.9 millions; and during the eight years ending with -1906, 265 millions. Thus the growth of exports of manufactures in the -eighteen years following 1890 was practically three times as great as -that of the entire seventy years preceding that year. - -Exports of manufactures from the United States now exceed 750 million -dollars per annum and have doubled in value in a single decade. Not -only has the exportation of manufactures doubled in a decade, but the -share which products of the factory form of the total exports is -steadily increasing. In 1880 manufactures formed but 15 per cent of -the total exports of domestic products; in 1890 they formed 21 per -cent, in 1900, 35 per cent, and in 1908, 41 per cent. - -With the rapid increase of population in the United States, and -therefore of the consumption of natural products, the quantity of 270 -food and raw materials remaining for distribution to other parts of -the world has not increased proportionately; and with the development -of manufacturing facilities and the trend of population to the -manufacturing centers, production of manufactures has rapidly -increased, and the surplus of these manufactures which may be spared -for foreign markets has also increased. Foodstuffs, which in 1890 -formed 42 per cent of the total exports of domestic products, formed -in 1908 but 28 per cent of the total; articles in a crude condition -for use in manufacturing, which in 1890 formed 36 per cent of the -totals, formed in 1908 but 30 per cent; while manufactures, as already -indicated, increased their share in the exports from 21 per cent in -1890 to 41 per cent in 1908. - -In the decade ending with 1905 exports of manufactures from the United -States increased 198 per cent, while those from Germany increased 75 -per cent, those from the United Kingdom 40 per cent, and those from -France 25 per cent. This rapid increase in the exports of manufactures -from the United States has brought her to the third rank in the list -of the world’s exporters of manufactures. The four greatest producers -of manufactures for exportation and the value of manufactures exported -by each of them in 1906 are as follows: The United Kingdom, 1,400 -million dollars; Germany, 1,000 million; the United States, 700 -million; and France, 500 million. - -To Europe the exports of manufactures from the United States in 1892 -was 76 million dollars, in 1901, 213 million, and in 1908, 368 -million. To North America the exports of manufactures from the United -States in 1892 were 33 million dollars, in 1908, 189 million; to Asia -and Oceania the total was 25 million dollars in 1892 and 112 million -in 1908; to Africa, in 1892, less than 4 million dollars, in 1908, -more than 10 million; to South America, in 1892, 17 million, in 1908, -72 million. Considering the distribution by principal countries, it -may be said that the total exports of manufactures from the United 271 -States to the United Kingdom was, in 1892, 40 million dollars, in -1902, 100 million; to British North America, in 1892, less than 10 -million, in 1902, over 54 million; to Germany, in 1892, 14 million, in -1902, 30 million; to Mexico, in 1892, less than 8 million, in 1902, -over 26 million; to British Australasia, in 1892, less than 9 million, -in 1902, over 23 million; and to China, in 1892, 5½ million, in 1902, -more than 23 million. - -Considering the exports by great articles or groups of articles, it -may be said that manufactures of iron and steel as a group form the -largest item in the exports of manufactures, having grown from 52 -thousand dollars in 1800 to 322 thousand in 1830, 1 million dollars in -1850, about 6 million in 1860, 13 million in 1870, 25 million in 1890, -121 million in 1900, and 184 million in 1908. Mineral oils form the -second largest item among the groups of manufactures, having grown -from 30 million in 1870 to 98 million in 1908. Copper manufactures -rank third, the total exports having grown from 1½ million dollars in -1860 to 2⅓ million in 1890 and 104 million in 1908. Leather and its -manufactures have increased their exportations from 1½ million in 1860 -to 6¾ million in 1880, 12 million in 1890, 27 million in 1900, and 41 -million in 1908. Exports of agricultural implements have grown from 1 -million dollars in 1870 to 4 million in 1890, 16 million in 1900, and -24 million in 1908. Thirty articles or groups of articles exceeded 1 -million dollars in the value of their respective exports in the fiscal -year 1908. Of these thirty groups now exceeding 1 million dollars each -in value annually, not one aggregated as much as a million dollars in -1820, and only three groups exceeded 1 million in 1850; in 1860 eight -groups exceeded each 1 million; in 1880 the number of groups exceeding -1 million in value was 13; in 1890, 20; and in 1908, as already -indicated, 30 exceeded 1 million each in the value of their annual -exportations. - -The causes of the rapid growth in the exports of manufactures from 272 -the United States are not difficult to determine. The growth as -already indicated, has occurred chiefly since 1880, and especially in -the last decade. From 1790 to 1880 the growth was a hundred million in -ninety years’ time. This was a period which was devoted to the -development of the agricultural resources of the country and to the -construction of railroads. The value of agricultural products exported -grew in this period from 19 million dollars to 686 million, an -increase of 667 million, while exports of manufactures were increasing -100 million. From 1880 to 1900 agricultural exports showed a gain of -206 million dollars and those of manufactures 330 million. Thus the -development of domestic exports from the United States has occurred in -definitely rounded periods: The first, a long period of growth of -agricultural products; the second, a shorter and more recent period, -in which the largest growth, and especially the largest proportionate -growth, has been in exports of manufactures. - -A study of the production in the United States of a few of the great -articles which form the basis of manufactures and the manufacturing -industries offers ready explanation of the great increase in the -production of manufactures and the consequent marked increase in the -exportation of manufactures. Six great articles supply the principal -requisites for manufacturing, viz, iron, copper, wood, cotton, wool, -and coal as the material which supplies the power by which they are -first assembled and afterwards converted into manufactures. The -production of pig iron in the United States which up to 1880 had never -reached 4 million tons, was by 1890, 9 million; in 1900, 13½ million, -and in 1907, 25 million. Of steel, the production in the United States -in 1880 for the first time exceeded 1 million tons; in 1890 it -exceeded 4 million tons; in 1900, more than 10 million, and in 1907, -more than 23 million. Of copper, for which the demands of the world -are now great, the United States produced in 1880, 27 thousand tons, 273 -in 1890, 116 thousand tons, and in 1906, 409 thousand tons. The total -value of the mineral products of the United States was in 1880, 369 -million dollars; in 1890, 619 million, and in 1908, 2,069 million, or -5½ times that of 1880. The cotton production of the United States was -in 1880, 5½ million bales, in 1890, 7½ million, and in 1908, over 13½ -million. In 1880, American mills took 31 per cent of the total -American production of cotton, and in 1907 they took 32 per cent of -the greatly increased total. Of wool, the production of 1880 was 232½ -million pounds; of 1890, 276 million, and that of 1908, 311 million. -Of coal, which has an important relation to manufactures, both in -supplying the motive power for the assembling of materials and heat -for smelting ores and other features of manufacturing work, as well as -the power for operating the machinery of manufacture, the production -in 1880 was 64 million tons; in 1890, 141 million; in 1900, 241 -million; and in 1907, 428 million. - -Of the six great articles here enumerated as the chief requisites of -manufacturing, the United States is the world’s largest producer of -all except wool. Of cotton, the United States produces three-fourths -of the world’s entire supply; of copper, fully one-half; of pig iron -and steel, the United States produces 40 per cent of the world’s -entire supply; and in 1907 produced more than Germany, the United -Kingdom, and Belgium combined, these three countries being, in the -order named, the world’s next largest producers of pig iron. Of timber -and wood suitable for use in manufacturing, the United States is the -world’s largest producer at the present time. Of wool, the United -States is only exceeded in its production by Australasia, Argentina -and Russia, its total product being in 1901, 302 million pounds -against 360 million in Russia, including Poland, Argentina, 370 -million, and Australasia, 510 million. - -In transportation, for assembling these great natural products for 274 -use in manufacturing, the facilities in the United States by far -surpass those of any other country. The railroads have grown from 30 -thousand miles in 1860 to 53 thousand miles in 1870, 93 thousand miles -in 1880, 166 thousand miles in 1890, and 240 thousand miles in 1908, -giving to the United States two-fifths of the entire railway mileage -of the world; while in transportation upon the Great Lakes the -registered tonnage of vessels passing through the Sault Ste. Marie -Canal alone in 1907 was 44 million tons, or practically three times as -much as the tonnage passing through the Suez Canal in the same year. - -Proportionately the growth in exports of manufactures has been even -greater than that in production of manufactures. The census figures -show that the gross value of manufactures produced in 1850 was, in -round terms, 1 billion dollars, and in 1905, nearly 17 billion, so -that the product of 1905 may be said to be about seventeen times as -great as that of 1850; while the exportation of manufactures, which in -1850 was $17,580,456, was in 1908, $750,000,000, or forty-two times as -great as in 1850, indicating that the percentage of growth in -exportation has been more than twice as great as that in the -production of manufactures. - -Of the articles which form the great and growing export trade of the -United States, those grouped under the term “manufactures” number over -two hundred distinct articles, though many of these are included -within the special groupings, such as agricultural implements, iron -and steel manufactures, mineral oils, leather and its manufactures, -etc. The group agricultural implements, for example, is subdivided -into mowers and reapers, plows and cultivators, and “all other,” the -latter term including numerous articles which are not of sufficient -value to justify at present a separate statement. The group cotton -manufactures includes cloths colored and uncolored, wearing apparel, -waste cotton, and all other. The group iron and steel includes pig 275 -iron, bar iron, wire rods, billets, ingots and blooms, hoop, band and -scroll iron, rails for railways, tin plates, structural iron and -steel, wire, locks, hinges, saws and tools, car wheels, castings, -table cutlery, firearms, cash registers, electrical machinery, laundry -machinery, metal-working machinery, printing presses, pumps and -pumping machinery, shoe machinery, locomotives (stationary and -railway), typewriters, nails (cut and wire), pipes, safes, scales, -stoves and ranges, each of which is separately stated, and following -these a class “all other,” which includes the less important articles -not separately enumerated. Under the group leather and its -manufactures are included sole leather, glazed, kid, patent, split, -and other upper leather, boots and shoes, harness and saddles. Under -the general title of refined or manufactured mineral oils are included -naphthas, illuminating oil, and lubricating and heavy paraffin oil. -Under the general title of musical instruments are included organs, -pianos, and all other. Paper and its manufactures include paper -hangings, printing paper, writing paper, envelopes, and all other. -Manufactures of tobacco include cigars and cigarettes, plug tobacco, -and all other. Wood manufactures include doors, sash and blinds; -furniture; hogsheads and barrels; trimmings, moldings and other house -finishings; woodenware, wood pulp, and all other. Wool manufactures -include carpets, dress goods, flannels and blankets, wearing apparel, -separately stated, and all other. - -Taking up the various groups or classes, and with them the articles -which are not subdivided, it may be said that thirty general articles -show a total exceeding $1,000,000 in the exports of recent years. -Exports of iron and steel manufactures as a whole amounted in 1908 to -184 million dollars; manufactured or refined mineral oils, 99 million; -copper manufactures, 100 million; cotton manufactures, 25 million; -leather and its manufactures, 27 million; agricultural implements, 276 -24 million; chemicals, drugs and dyes, 21 million; cars and carriages, -22 million; paraffin, 8 million; paper and its manufactures, 8 -million; tobacco manufactures, 5 million; scientific instruments, 11 -million; fiber manufactures, 5 million; india-rubber manufactures, 7½ -million; books, maps and engravings, 6 million. - -Tracing the more important of these articles through the period from -1790 to 1908 it may be said that iron and steel manufactures, which -began their record in 1790 with a total exportation of $117,060, did -not reach $1,000,000 until 1840, when the total export was $1,127,877. -Even in 1850 it was only $1,953,702, but by 1860 was $5,870,114; in -1870, $13,483,163; in 1880, $14,716,524; in 1890, $25,542,208, and in -the decade from 1890 to 1900 it increased nearly fourfold, the total -for 1908 being $183,982,182 against $25,542,208 in 1890. The growth in -the exportation of manufactures of iron and steel has been more -strongly marked than that in any other important article of export -except copper. It has been coincidental with the development of the -great iron mines of the United States and the production of pig iron -and steel. - -The next article in the order of its magnitude in our exportations is -refined mineral oil, which only became an article of export after the -great oil discoveries in the decade 1860-1870. Its first appearance in -the list of exports was in 1864, in which year the total amounted to -$6,918,502, the small quantities exported in preceding years not -having separately enumerated in the list of articles exported. The -value of the exportations of mineral oil increased very rapidly, the -total for 1864 being slightly less than 7 millions; for 1865, nearly -10 millions; 1866, over 18 millions; 1867, 22 millions; 1870, 30 -millions; 1880, 34 millions; 1890, 44 millions; 1900, 68 millions, -and 1908, 99 millions. - -Copper, which forms the third article in rank in the exports of 277 -manufactures, is of recent date as an article of importance in the -export trade. The existence of large copper deposits in the United -States had been known for many years, but it was only upon the greatly -increased demand for copper owing to the developments in the use of -electricity as a motive power that the world began to demand copper in -greatly increased quantities; and to this demand the mines of the -United States promptly responded. The copper production of the United -States had never reached as much as 20,000 tons prior to 1877. By 1887 -it was 81,000 tons; by 1897, 220,000 tons; and in 1907, 410,000 tons. -The most strongly marked increase occurred during the period of -1890-1907, the production of 1890 being 115,000 tons, and in 1907, -410,000 tons. The growth in exportation was coincidental with the -growth in production. The value of copper manufactures exported in -1890 was but $2,349,392; in 1891, it was $4,614,597; in 1892, -$7,226,392; in 1895, $14,468,703; in 1896, $19,720,104; in 1897, -$31,621,125; and in 1908, $104,064,580 or nearly fifty times as much -in 1908 as in 1890. - -Leather and manufactures thereof grew from 1½ million in 1860 to 6½ -million in 1880, 12½ million in 1890, 27 million in 1900, practically -30 million in 1902, and 42 million in 1909. Agricultural implements -have also shown a rapid increase in exportation. In 1870 they amounted -to only 1 million dollars in value; in 1880, to a little over 2 -million; in 1890, nearly 4 million; in 1900, 16 million; and in 1902, -16¼ million. - -Chemicals, drugs, dyes, etc., formed the largest single item of -exports in 1790, pot and pearl ashes being then the principal article -in the list, and have slowly but steadily increased, reaching a -million dollars in 1830, 2½ million in 1870, 5½ million in 1890, 12 -million in 1902, and 21 million in 1908. It is proper to add that in -the later years patent medicines, which are included under this general -classification of chemicals, etc., have formed a considerable 278 -proportion of this increase, the total value of patent medicines -exported being in 1902, 3 million dollars out of the total of 12 -million. The chemical industry of the United States has not made as -rapid gains either in the relative value of its products, in the -supply of the home market, or in the distribution of exports as -accomplished by many other industries. The total value of the chemical -productions of the country, according to the census, was in 1880, -$38,640,458; in 1890, $59,352,548; and in 1900, $62,676,730, having -less than doubled the value of the product from 1880 to 1900, the -increase being but 60 per cent, while manufactures as a whole -increased 142 per cent. - -Considering the grand divisions and countries to which we send this -$750,000,000 worth of manufactures exported from the United States, it -may be said that literally every country of the world is a purchaser -of American manufactures. In each grand division and in every country -of the world the manufactured products of the United States are being -consumed in steadily increasing quantities and varieties; and this -consumption of the products of the manufacturing establishments of the -United States by other parts of the world is a voluntary one, and not -an “invasion” in the ordinarily accepted sense of the term. The growth -in the consumption of American manufactures in other parts of the -world is quite as voluntary as is the consumption of American flour, -or meat, or cotton. This is illustrated by the fact that, while the -iron and steel manufacturing establishments have been unable to meet -the orders of the home consumers, and, therefore, have made little -effort to “invade” other markets, more than $184,000,000 worth of iron -and steel manufactures was exported in 1908, presumably, in most -cases, to fill orders from other parts of the world. The fact that the -home demand for iron and steel manufactures was in 1907 so great as to -more than double the importation of iron and steel manufactures in a -single year, shows clearly that the condition of a home market was 279 -such that the iron and steel manufactures of the United States needed -make no effort to “invade” the markets of other parts of the world, -and that whatever sales they made in those lines outside of the United -States were, as a rule, in response to calls from the countries to -which these classes of merchandise are sent. The exportations of iron -and steel manufactures from the United States in the fiscal year 1908, -were: To Europe, 47 million dollars; North America, 72 million; -Oceania, 14 million; South America, 22 million; Asia, 25 million; and -Africa, 3 million. Of American copper the purchases by Europe were, in -1891, $4,433,015 in value, and in 1908, $97,324,230. For agricultural -implements the home demand is large and active, yet the exportation of -agricultural implements, presumably all or nearly all orders, was in -1908, to Europe, 13 million dollars; to North America, 2½ million; to -South America, 5 million; to Oceania, over 1 million; and to Asia and -Africa, 13 million. The railroads of the United States were in 1906 -and 7, according to repeated statements, unable to obtain cars in -sufficient number to meet their requirements, yet the exportation of -cars for steam railways in the fiscal year 1908 amounted to about -$5,000,000. - -The large share which manufactures form in the exports of the United -States is shown by an analysis by the Bureau of Statistics of the -Department of Commerce and Labor of the trade, by articles and groups -of articles, with every country and grand division of the world. These -figures show that manufactures formed 86 per cent of exports to South -America in 1906, 85 per cent of the exports to Oceania, 75 per cent of -the exports to Asia, 66 per cent of the exports to Africa, 62 per cent -of the exports to North America, while even to Europe manufactures -formed 27 per cent of the total domestic merchandise sent in the -fiscal year 1906. - -This general group, “manufactures,” upon which the above percentages 280 -are based, includes both manufactures ready for consumption and -manufactures for further use in manufacturing. The first group -includes all manufactures in the fully completed form and ready for -immediate use. The second is made up chiefly of chemicals, leather, -naval stores, lumber, copper in pigs, bars, and ingots, and various -grades of iron and steel which have passed through a process of -manufacture but are to be further used in manufacturing, such as steel -bars, billets, ingots, blooms, sheets and plates, tin plate, wire -rods, and pig iron. - -Of the 75 million dollars’ worth sent to South America, 72.4 per cent -was manufactures ready for consumption and 14.02 per cent manufactures -for further use in manufacturing. Of the 105 million dollars’ worth -sent to Asia, 65.79 was manufactures ready for consumption and 9.14 -per cent manufactures for further use in manufacturing. Of the 35 -million dollars’ worth sent to Oceania, 72.97 per cent was -manufactures ready for consumption and 11.78 per cent manufactures for -further use in manufacturing. Of the 20 million dollars’ worth sent to -Africa, 58.79 per cent was manufactures ready for consumption and 6.85 -per cent manufactures for further use in manufacturing. Of the 295 -million dollars’ worth exported to North America, 50.46 per cent was -manufactures ready for consumption and 11.37 per cent manufactures for -further use in manufacturing. Of the 1,189 million dollars’ worth of -domestic merchandise sent from the United States to Europe in 1906, -12.72 per cent was manufactures ready for consumption and 14.06 per -cent manufactures for further use in manufacturing. - -Thus, more than one-half of the domestic merchandise sent out of the -United States to each grand division except Europe goes in the fully -manufactured form, ready for consumption; in the case of South America -and Oceania practically three-fourths, in the case of Asia practically -two-thirds, and in the case of North America practically one-half 281 -goes in the fully manufactured form. - -Taking up the principal countries, the figures of the Bureau of -Statistics show that 11.85 per cent of the exports of the United -Kingdom was manufactures ready for consumption and 11.22 per cent -manufactures for further use in manufacturing. Of the exports to -Germany, 10.98 per cent was manufactures ready for consumption and -12.96 per cent manufactures for further use in manufacturing. To -France, 12.67 per cent of the exports was manufactures ready for -consumption and 18.44 per cent manufactures for further use in -manufacturing. To Canada, 48.8 per cent of the exports was -manufactures ready for consumption and 13.1 per cent manufactures for -further use in manufacturing. To Mexico, 58.77 per cent was -manufactures ready for consumption and 11.61 per cent manufactures for -further use in manufacturing. To Cuba, 45.94 per cent of the exports -was manufactures ready for consumption and 9.31 per cent manufactures -for further use in manufacturing. To Argentina, 79.93 per cent of the -exports was manufactures ready for consumption and 18.67 per cent -manufactures for further use in manufacturing. To Brazil, 72.9 per -cent of the exports was manufactures ready for consumption and 10.24 -per cent manufactures for further use in manufacturing. To Chile, -74.82 per cent of the exports was manufactures ready for consumption -and 10.71 per cent manufactures for further use in manufacturing. To -China, 85.12 per cent was manufactures ready for consumption and 10.65 -per cent manufactures for further use in manufacturing. To Japan, -45.89 per cent of the exports was manufactures ready for consumption -and 10.28 per cent manufactures for further use in manufacturing. To -the Philippine Islands, 59.75 per cent of the shipments was -manufactures ready for consumption and 9.13 per cent manufactures for -further use in manufacturing. To Australia, 76.48 per cent of the -exports was manufactures ready for consumption and 12.26 per cent 282 -manufactures for further use in manufacturing. - -Foodstuffs and manufacturers’ material form the larger share of the -merchandise sent to Europe and a considerable percentage of that sent -to North America, while to the other grand divisions neither -foodstuffs nor raw material for manufacturing form any considerable -per cent of the total. To Europe, foodstuffs (chiefly wheat flour, -corn and meats) formed 36.3 per cent of the total merchandise sent in -1906, while raw materials for use in manufacturing (chiefly cotton) -formed 36.83 per cent of the total, the remainder being, as above -indicated, manufactures ready for consumption or manufactures for -further use in manufacturing. To North America, foodstuffs formed -20.23 per cent of the total and manufacturers’ raw material 16.12 per -cent. To South America, foodstuffs formed 13.32 per cent of the total -and manufacturers’ raw material less than 1 per cent. To Asia, -foodstuffs formed 13.83 per cent and manufacturers’ raw material 11.2 -per cent, this larger percentage of the raw material being due chiefly -to sales of raw cotton to Japan. To Oceania, foodstuffs formed 9.65 -per cent of the total and manufacturers’ raw material 4.96 per cent. -To Africa, foodstuffs formed 28.39 per cent of the total exports and -manufacturers’ raw material 5.86 per cent. - -Taking up the analysis of exports to other parts of the world, the -figures show that of the exports to the United Kingdom 34.07 per cent -was crude materials for use in manufacturing; 27.29 per cent -foodstuffs partly or wholly manufactured, including in this group -flour, meats, dried and preserved fruits, etc.; 15.46 per cent -foodstuffs in a crude condition, and food animals; 13.1 per cent -manufactures for further use in manufacturing, and 11.85 per cent -manufactures ready for consumption. Of the exports to Germany, 48.28 -per cent was crude materials for use in manufacturing; 19 per cent -foodstuffs partly or wholly manufactured; 8.65 per cent foodstuffs in -a crude condition, including food animals; 12.96 per cent manufactures 283 -for further use in manufacturing, and 10.98 per cent manufactures -ready for consumption. In the case of France, 55.38 per cent of the -total was crude materials for use in manufacturing; 5.52 per cent -foodstuffs partly or wholly manufactured; 7.96 per cent foodstuffs in -a crude condition; 18.44 per cent manufactures for further use in -manufacturing, and 12.67 per cent manufactures ready for consumption. -In the case of Canada, 24.39 per cent was raw materials for use in -manufacturing; 4.74 per cent foodstuffs partly or wholly manufactured; -6.23 per cent foodstuffs in a crude condition, and food animals; 13.1 -per cent manufactures for further use in manufacturing and 48.8 per -cent manufactures ready for consumption. - -Summing up this study of the share which manufactures formed of the -exports of the United States to the principal countries and grand -divisions in 1906, the figures show that 151 million dollars’ worth of -manufactures ready for consumption went to Europe, 149 million -dollars’ worth to North America, 69 million dollars’ worth to Asia, 54 -million dollars’ worth to South America, 26 million dollars’ worth to -Oceania, and 11 million dollars’ worth to Africa; while of the -manufactures for further use in manufacturing 167 million dollars’ -worth went to Europe, 33 million to North America, 10 million to South -America, 10 million to Asia, 4 million to Oceania, and a little over 1 -million dollars’ worth to Africa. Thus while manufactures formed but a -comparatively small percentage of the exports to Europe because of the -large quantities of foodstuffs and raw material demanded by that -country, they actually aggregated a greater sum than the manufactures -sent to any other of the grand divisions, though in the other cases -the percentage which manufactures formed of the total was much larger -than in the trade with Europe. - -Even with this large production of manufactures in the United States -it may safely be said that less than one-tenth of our manufactures 284 -are exported, while those imported equal in stated value about -one-twentieth that of the home product. This statement is the result -of a comparison of the figures of production, exportation, and -importation of manufactures in the United States presented by the -Statistical Abstract of the United States, issued by the Bureau of -Statistics of the Department of Commerce and Labor. - -The Census of 1905 shows the gross value of the factory product of -manufactures in 1904 at 14,802 million dollars, and estimates the -value of all other manufactures, mechanical and neighborhood, at about -2 billion, making the gross value of all manufactures produced in the -United States in 1904, 16,867 million dollars. This gross valuation, -however, includes many duplications, because the products reported by -one manufacturer often become the manufacturing material of another, -who also includes their cost in the report of the value of the -products of his factory. By deducting from the gross valuation the -value of this manufacturing material used in a partly manufactured -form, the Census Office states the net or true value of the -manufactures of the country in the census year. This process reduced -the valuation of the factory product of 1904 from the gross figure of -14,802 million, to a net valuation of 9,821 million; and an -application of the same method of reduction to the non-factory -manufactures would place the net value of all manufactures in 1904 at -10,892 million dollars. The Census of 1900, which reported the gross -value of all manufactures in 1899 at 13,014 million dollars, places -the net value for that year at 8,371 million. - -The Bureau of Statistics’ figures show that the exportation in the -year ending June 30, 1905, of all articles classed by the census as -manufactures, amounted in value to 895 million dollars, a sum which -equals 8.2 per cent of the 10,892 million estimated as the net value -of all manufactures in 1904. The imports in the year ended June 30, 285 -1905, of all articles similar to those classed by the census as -manufactures, were valued at 576 million dollars, which equals 5.3 -per cent of the net value of the domestic manufactures of 1904. - -Even these figures, which show that the valuation of manufactures -exported equals 8.2 per cent of the valuation of the manufactures -produced, and that the valuation of the manufactures imported equals -5.3 per cent of the valuation of the manufactures produced, are, -however, only approximate, in an attempt to determine the true -relation of imports or exports of manufactures to the home production. -The valuation of manufactures, supplied to the Census Office, by the -various manufacturers, states the value of the product at the place of -production; while the Bureau of Statistics’ figures of exportations -state the wholesale market value of the article at the port from which -exported. Thus the stated values of the articles exported are -doubtless in most cases higher than the stated values of the same -articles at the place of production since the cost of transportation -and dealers’ profits are presumably added in the valuations at which -the domestic merchandise in question is wholesaled at the various -ports whose current prices determine the valuation placed upon the -articles when exported. On the other hand, the values of the imported -articles quoted by the Bureau of Statistics are by law “the actual -market values or wholesale prices of such merchandise in the principal -markets of the country whence imported,” and if freights and profits -are added to this figure the valuation at the point where it actually -enters the United States would be somewhat in excess of that quoted. -Thus the value of manufactures produced are those of the place of -production, the figures of exports are those of the wholesale markets -of the port from which exported, and those of importation are those of -the wholesale market of the country whence imported. Could production, 286 -exports, and imports be brought to a common basis of valuation, the -percentage which exports bear to the total production would be -slightly reduced and that which imports bear to the total production -be slightly increased; and the percentages which exports and imports, -respectively, bear to the total production would become more nearly -identical than those above quoted, of 8.2 per cent on the export side -and 5.3 per cent on the import side. - -The share exported of the manufactures of the country seems to have -slowly but steadily increased. The gross valuation of manufactures -produced was, speaking in very round terms, in 1850, 1 billion -dollars; in 1860, 1¾ billion; in 1870, 4¼ billion; in 1880, 5⅓ -billion; in 1890, 9⅓% billion; in 1900, 13 billion; and in 1905, 16¾ -billion. Reducing these gross valuations to net value at the same -ratio as that indicated by the census reduction of 1900, the net value -of manufactures in 1850 would stand at ⅔ of 1 billion dollars, in -1860 at 1¼ billion, in 1870 at 2¾ billion, in 1880 at 3½ billion, in -1890 at 6 billion, in 1900 at 8⅓ billion, and in 1905 at a little less -than 11 billion. The exportation of all articles now classed by the -census as manufactures was in 1850, 43 million dollars; in 1860, 87 -million; in 1870, 160 million (currency values); in 1880, 315 million; -in 1890, 404 million; in 1900, 803 million; and in 1905, 895 million. -These figures of net products and exports, when compared -statistically, show that the exports equalled in 1850, 6.6 per cent of -the figures of net production; in 1860, 7.2 per cent; in 1870, 5.9 per -cent; in 1880, 9.1 per cent; in 1890, 6.7 per cent; in 1900, 9.6 per -cent; and in 1905, 8.2 per cent. That the exportation has grown even -more rapidly than the production is also apparent from a comparison of -the figures of 1905 with those of 1850, since the production of -manufactures in 1905 was practically seventeen times as great as that -of 1850, while the exportation of manufactures in 1905 was twenty-one 287 -times as great as in 1850. - -On the import side the ratio of imports of manufactures to production -has steadily fallen. Imports of all articles now included by the -census classification of manufactures amounted in 1850 to 143 million -dollars, in 1860 to 267 million, in 1870 to 433 million (currency -values), in 1880 to 426 million, in 1890 to 481 million, in 1900 to -470 million, and in 1905 to 576 million. The percentage which imports -of manufactures bore to production of manufactures was, in 1850, 21.8 -per cent; in 1860, 22 per cent; in 1870, 15.9 per cent; in 1880, 12.3 -per cent; in 1890, 8 per cent; in 1900, 5.6 per cent; and in 1905, 5.3 -per cent. - -It is proper to add that the figures above cited as representing the -exportation of articles classed by the census as manufactures do not -coincide with the usual statement of “Manufactures Exported,” as -issued by the Bureau of Statistics from month to month and year to -year, but includes many articles classed as manufactures by the -census, but ordinarily classed by the Bureau of Statistics as -“Foodstuffs Partly or Wholly Manufactured.” The Bureau of Statistics -in its import and export statements groups under one title of -“Manufactures Ready for Consumption” all articles completely -manufactured and ready for use, such as boots and shoes, cars and -carriages, and illuminating oil; under another head, “Articles for -Further Use in Manufacturing,” all articles in a partially -manufactured state, but requiring further processes before ready for -final use, such as pig copper, pig iron, pig tin, lumber, etc.; while -the group “Foodstuffs Partly or Wholly Manufactured” includes food -articles which have undergone certain processes of preparation for -use, such as salted meats, canned fruit and vegetables, dried fruits, -flour, sugar, and other articles usually classed by the great -importing and exporting nations under the general title of foodstuffs. -The two groups, “Manufactures Ready for Use,” and “Manufactures for 288 -Further Use in Manufacturing,” are usually included by the bureau in -its statements of exports of manufactures, while the third group, -“Foodstuffs Partly or Wholly Manufactured,” is not usually so classed. -In the above statement, however, in which the attempt is made to -compare imports and exports with the census figures of manufactures, -the third group, “Foodstuffs Partly or Wholly Manufactured,” is -included under the general title of manufactures, in order to make the -import and export figures comparable with the census figures of -production. - -Turning to the individual articles forming the great mass of -manufactures produced or exported, the percentage of the product -exported varies greatly with the various articles or groups of -articles. Comparing the Bureau of Statistics’ figures of exports for -the fiscal year 1905 with the census figures of production in the -calendar year 1904, the percentage which the export figures bear to -those of production are, in the case of agricultural implements 18.5 -per cent, bicycles and tricycles 26.8 per cent, cash registers 20.6 -per cent, sewing machines 29.3 per cent, and typewriters 44.6 per -cent; while in a large proportion of articles the percentage is very -much less--boots and shoes 2.5 per cent, carriages and wagons 2.7 per -cent, structural iron 4 per cent, furniture of wood 2.6 per cent, -flour and gristmill products 5.6 per cent, and automobiles 8.3 per -cent. - - - - -IX. STATISTICS OF MANUFACTURING. 289 - - -Approximate Annual Value of Manufactures Produced in the Principal -Manufacturing Countries at dates named, 1780 to 1900. - - ================================================= - | 1780. | 1800. | 1820. | 1840. | - Countries. +-------+-------+-------+-------+ - | Millions of Dollars. - ----------------+-------+-------+-------+-------+ - United Kingdom | 861 | 1,119 | 1,411 | 1,883 | - Germany | 243 | 292 | 414 | 730 | - France | 715 | 925 | 1,071 | 1,285 | - Austria-Hungary | 146 | 243 | 389 | 691 | - Russia | 49 | 73 | 97 | 195 | - Italy | 49 | 73 | 122 | 195 | - Belgium | .... | .... | .... | 292 | - Spain | 49 | 97 | 146 | 219 | - United States | 73 | 122 | 268 | 467 | - Various | 151 | 219 | 292 | 438 | - ----------------+-------+-------+-------+-------- - Total | 2,336 | 3,163 | 4,210 | 6,395 | - ----------------+-------+-------+-------+-------+ - - ================================================ - | 1860. | 1888. | 1896. | 1900. - Countries. +-------+-------+-------+------- - | Millions of Dollars. - ----------------+-------+-------+-------+------- - United Kingdom | 2,808 | 3,991 | 4,263 | 5,000 - Germany | 1,509 | 2,837 | 3,358 | 4,601 - France | 1,849 | 2,360 | 2,900 | 3,450 - Austria-Hungary | 973 | 1,231 | 1,596 | 2,000 - Russia | 754 | 1,767 | 1,849 | 1,980 - Italy | 389 | 589 | 925 | 1,700 - Belgium | 438 | 496 | 574 | 750 - Spain | 292 | 414 | 589 | 615 - United States | 1,908 | 7,022 | 9,636 |13,004 - Various | 779 | 1,767 | 2,097 | 2,317 - ----------------+-------+-------+-------+------- - Total |11,699 |22,474 |27,787 |35,417 - ----------------+-------+-------+-------+------- - -Note.--The figures (Mulhall’s estimates prior to 1900) here given for -the United States are those of gross values. The relation of “gross” -to “net” value of the manufactures of the United States is explained -at page 211. - - -Approximate Annual Value of Manufactures Produced In the Principal -Manufacturing Countries at dates named, 1780 to 1900. - - ================================================= - | 1780. | 1800. | 1820. | 1840. | - Countries. +-------+-------+-------+-------+ - | Millions of Dollars. - ----------------+-------+-------+-------+-------+ - United Kingdom | 861 | 1,119 | 1,411 | 1,883 | - Germany | 213 | 292 | 414 | 730 | - France | 715 | 925 | 1,071 | 1,285 | - Austria-Hungary | 146 | 243 | 389 | 691 | - Russia | 49 | 73 | 97 | 195 | - Italy | 49 | 73 | 122 | 195 | - Belgium | .... | .... | .... | 292 | - Spain | 49 | 97 | 146 | 219 | - United States | 48 | 81 | 179 | 311 | - Various | 151 | 219 | 292 | 438 | - ----------------+-------+-------+-------+-------+ - Total | 2,311 | 3,122 | 4,121 | 6,239 | - ----------------+-------+-------+-------+-------+ - - ================================================ - | 1860. | 1888. | 1896. | 1900. - Countries. +-------+-------+-------+------- - | Millions of Dollars. - ----------------+-------+-------+-------+------- - United Kingdom | 2,808 | 3,991 | 4,263 | 5,000 - Germany | 1,509 | 2,837 | 3,358 | 4,601 - France | 1,849 | 2,360 | 2,900 | 3,450 - Austria-Hungary | 973 | 1,231 | 1,596 | 2,000 - Russia | 754 | 1,767 | 1,849 | 1,980 - Italy | 389 | 589 | 925 | 1,700 - Belgium | 438 | 496 | 574 | 750 - Spain | 292 | 414 | 589 | 615 - United States | 1,272 | 4,681 | 6,426 | 8,371 - Various | 779 | 1,767 | 2,097 | 2,317 - ----------------+-------+-------+-------+------- - Total |10,063 |20,133 |24,577 |30,784 - ----------------+-------+-------+-------+------- - -Note.--Figures are those of Mulhall, except for 1900, the figures of -gross manufactures for the United States having been reduced to net on -the basis of net equal to 66⅔ per cent of gross; figures for 1900, -estimate of Wm. J. Clark, in Engineering Magazine, May, 1904. - - -Importation of Manufactures into United Kingdom and United States, -respectively, at quinquennial years, 1870 to 1908. - -[From official statistics of the respective governments.] - - ================================================== - | Into the United | Into the United - | Kingdom. | States. - Year[D] | Millions dollars. | Millions dollars. - ----------+-------------------+------------------- - 1870 | 277 | 229 - 1875 | 354 | 241 - 1880 | 405 | 307 - 1885 | 406 | 261 - 1890 | 478 | 348 - 1895 | 483 | 296 - 1900 | 630 | 337 - 1905 | 707 | 430 - 1907 | 754 | 638 - 1908 | 696 | 528 - ----------+-------------------+------------------- - - [D] For United States, fiscal years; for United Kingdom, calendar years. - - -Commerce of the United States, the United Kingdom and Germany, from 290 -1875 to 1908. Showing exports of domestic merchandise, and exports of -domestic manufacture from each country named. - - =======+=========================================+ - | Imports of merchandise. | - -------+-------------+-------------+-------------+ - | United | | United | - Year. | Kingdom. | Germany.[E] | States.[F] | - -------+-------------+-------------+-------------+ - | Dollars. | Dollars. | Dollars. | - 1875 |1,819,779,000| 839,590,000| 533,005,000| - 1880 |2,001,251,000| 670,945,000| 667,955,000| - 1885 |1,805,316,000| 699,067,000| 577,527,000| - 1890 |2,047,298,000| 990,023,000| 789,310,000| - 1895 |2,027,822,000| 980,719,000| 731,970,000| - 1900 |2,545,544,000|1,372,216,000| 849,941,000| - 1901 |2,540,264,000|1,290,254,000| 823,172,000| - 1902 |2,571,416,000|1,340,178,000| 903,321,000| - 1903 |2,642,054,050|1,424,080,000|1,025,719,000| - 1904 |2,681,629,000|1,514,660,000| 991,087,000| - 1905 |2,749,669,000|1,696,660,000|1,117,513,000| - 1906 |2,958,289,000|1,909,210,000|1,226,562,000| - 1907 |3,143,293,000|2,046,187,000|1,434,421,000| - 1908 | | |1,194,342,000| - -------+-------------+-------------+-------------+ - - =======+=========================================+ - | Exports of domestic merchandise. | - -------+-------------+-------------+-------------+ - | United | | United | - Year. | Kingdom. | Germany. | States.[F] | - -------+-------------+-------------+-------------+ - | Dollars. | Dollars. | Dollars. | - 1875 |1,087,497,000| 593,052,000| 499,284,100| - 1880 |1,085,521,000| 688,500,000| 823,946,353| - 1885 |1,037,124,000| 680,551,000| 726,682,946| - 1890 |1,282,472,000| 791,717,000| 845,293,828| - 1895 |1,100,453,000| 789,660,000| 793,392,599| - 1900 |1,417,086,000|1,097,509,000|1,370,763,571| - 1901 |1,362,729,000|1,054,685,000|1,460,462,806| - 1902 |1,379,283,000|1,111,008,000|1,355,481,861| - 1903 |1,415,179,000|1,113,313,000|1,392,231,302| - 1904 |1,463,412,000|1,242,987,000|1,435,179,000| - 1905 |1,605,053,000|1,364,131,000|1,491,745,000| - 1906 |1,827,737,000|1,513,449,000|1,171,953,000| - 1907 |2,074,125,000|1,634,803,000|1,853,718,000| - 1908 | | |1,834,786,000| - -------+-------------+-------------+-------------+ - - =======+======================================== - | Exports of domestic manufactures. - -------+-------------+-------------+------------- - | United | | United - Year. | Kingdom. | Germany. | States.[F] - -------+-------------+-------------+------------- - | Dollars. | Dollars. | Dollars. - 1875 | 978,886,000| ........ | 101,962,000 - 1880 | 970,681,000| 460,279,000| 121,818,000 - 1885 | 913,353,000| 504,623,000| 150,256,000 - 1890 |1,118,657,000| 511,096,000| 178,982,000 - 1895 | 953,800,000| 518,723,000| 205,058,000 - 1900 |1,142,603,000| 709,806,000| 484,846,000 - 1901 |1,110,131,000| 688,409,000| 465,778,000 - 1902 |1,127,606,000| 735,182,000| 453,865,000 - 1903 |1,163,812,000| 780,925,000| 467,898,000 - 1904 |1,204,359,000| 819,196,000| 523,320,000 - 1905 |1,322,851,000| 910,017,000| 611,426,000 - 1906 |1,523,699,000|1,046,938,000| 686,023,000 - 1907 |1,690,038,000| No data. | 740,123,000 - 1908 | | | 750,576,000 - -------+-------------+-------------+------------- - - [E] Imports for consumption. - - [F] Years ending June 30. - - -Exportation of Manufactures from United Kingdom and United States, 291 -respectively, at quinquennial years, 1870 to 1908. - -[From official statistics of the respective governments.] - - =========+====================+==================== - | From the United | From the United - | Kingdom. | States. - Year[G] | Millions dollars. | Millions dollars. - ---------+--------------------+-------------------- - 1870 | 888 | 70 - 1875 | 979 | 102 - 1880 | 965 | 122 - 1885 | 915 | 150 - 1890 | 1,112 | 179 - 1895 | 941 | 205 - 1900 | 1,126 | 485 - 1905 | 1,329 | 611 - 1907 | 1,694 | 740 - 1908 | 1,445 | 751 - ---------+--------------------+-------------------- - - [G] For United States, fiscal years; for United Kingdom, calendar - years. - - -Coal Production of the World by Principal Countries, at quinquennial -periods from 1870 to 1895 and annually since that date. - -[From reports of the United States Geological Survey.] - - =======+============+============+============+===========+ - | | | | | - | United | Great | | | - Year. | States. | Britain. | Germany. | France. | - | | | | | - -------+------------+------------+------------+-----------+ - | Short tons.| Short tons.| Short tons.|Short tons.| - 1870 | 33,035,580| 123,682,935| 37,488,312| 14,530,716| - 1875 | 52,348,320| 149,303,263| 52,703,970| 18,694,916| - 1880 | 71,481,570| 164,605,738| 65,177,634| 21,346,124| - 1885 | 111,160,295| 178,473,588| 81,227,255| 21,510,359| - 1890 | 157,770,963| 203,408,003| 98,398,500| 28,756,638| - 1895 | 193,117,530| 212,320,725| 114,561,318| 30,877,922| - 1896 | 191,986,357| 218,804,611| 123,943,159| 32,167,270| - 1897 | 200,229,199| 226,385,523| 132,762,882| 33,938,987| - 1898 | 219,976,267| 226,301,058| 144,283,196| 35,656,426| - 1899 | 253,741,192| 246,506,155| 149,719,766| 36,215,026| - 1900 | 269,684,027| 252,203,056| 164,805,202| 36,811,536| - 1901 | 293,299,816| 245,332,578| 168,217,082| 35,596,536| - 1902 | 301,590,439| 254,346,447| 165,826,496| 33,286,146| - 1903 | 357,356,416| 257,974,605| 179,076,630| 38,466,873| - 1904 | 351,816,398| 260,319,665| 186,785,378| 37,663,349| - 1905 | 392,722,635| 264,464,408| 191,576,074| 38,951,360| - 1906 | 414,157,278| 281,195,743| 222,350,526| 37,828,931| - -------+------------+------------+------------+-----------+ - - =======+================+======= - | | Per - |Total production| cent - Year. | of the | of - | world. | U. S. - -------+----------------+------- - | Short tons. | - 1870 | 234,850,088| 14.07 - 1875 | 308,479,177| 16.97 - 1880 | 369,413,780| 20.62 - 1885 | 447,783,802| 24.82 - 1890 | 563,693,232| 27.99 - 1895 | 644,177,076| 29.98 - 1896 | 664,001,718| 28.92 - 1897 | 697,213,515| 28.72 - 1898 | 738,129,608| 29.80 - 1899 | 801,976,021| 31.63 - 1900 | 846,041,848| 31.88 - 1901 | 870,711,044| 33.69 - 1902 | 888,453,950| 33.95 - 1903 | 972,195,531| 36.76 - 1904 | 983,527,562| 35.78 - 1905 | 1,034,156,604| 37.98 - 1906 |[H]1,106,478,707| 37.43 - -------+----------------+------- - - [H] Latest available figures are used in making up totals for 1906. - -Note.--The use of coal for the production of power for use in -manufacturing has such an important relation to that industry that the -presentation of this table in this study seems justifiable. - - -World’s Production of Cotton. - -[From Latham, Alexander & Co.’s “Cotton Movement & Fluctuation,” 1902-7.] - - ===============+==========+==========+==========+==========+========== - Countries. | 1902-3. | 1903-4. | 904-5. | 1905-6. | 1906-7. - ---------------+----------+----------+----------+----------+---------- - | Bales. | Bales. | Bales. | Bales. | Bales. - United States |10,511,020| 9,841,671|13,420,440|11,048,000|13,346,000 - East Indies[I] | 2,737,577| 2,734,400| 2,952,720| 2,983,370| 3,482,000 - Egypt | 1,148,700| 1,275,754| 1,244,968| 1,152,516| 1,350,000 - Brazil[J] | 329,390| 307,516| 325,928| 476,667| 400,000 - ---------------+----------+----------+----------+----------+---------- - Total |14,726,687| 4,159,341|17,944,056|15,660,553|18,578,000 - ---------------+----------+----------+----------+----------+---------- - - [I] Includes India’s exports to Europe, America and Japan, and mill - consumption in India increased or decreased by excess or loss of - stock at Bombay. - - [J] Receipts into Europe from Brazil, Smyrna, Peru, West Indies, - etc., and Japan and China cotton used in Japanese mills. - - -Estimated Number of Cotton Spindles at Work on the Continent of 292 -Europe, Sept. 30, 1907. - -[From Alfred B. Shepperson’s “Cotton Facts,” December, 1907.] - - Russia and Poland 7,000,000 - Germany 9,000,000 - Austria 3,700,000 - France 6,200,000 - Spain 2,800,000 - Switzerland 1,550,000 - Italy 3,000,000 - Belgium 1,300,000 - Sweden, Norway, etc. 550,000 - Holland 420,000 - Portugal 210,000 - Greece 70,000 - ---------- - Total 35,800,000 - - -Annual Consumption of Cotton in Cotton Mills. - -[From Alfred B. Shepperson’s “Cotton Facts,” December, 1907.] - - =======+==========+==========+==========+==========+==========+========== - | | | Northern | Southern | Total of | - Season | Great | Continent| States of| States of| United | India. - of | Britain. | Europe. | U. S. | U. S. | States. | - +----------+----------+----------+----------+----------+---------- - | In bales of 500 pounds net. - -------+----------+----------+----------+----------+----------+---------- - 1896-7 | 3,224,000| 4,368,000| 1,771,000| 946,000| 2,717,000| 1,041,000 - 1897-8 | 3,432,000| 4,628,000| 1,771,000| 1,151,000| 2,922,000| 1,185,000 - 1898-9 | 3,519,000| 4,784,000| 2,218,000| 1,364,000| 3,582,000| 1,340,000 - 1899- | 3,334,000| 4,576,000| 2,163,000| 1,524,000| 3,687,000| 1,162,000 - 1900-1 | 3,269,000| 4,576,000| 1,909,000| 1,526,000| 3,435,000| 1,087,000 - 1901-2 | 3,253,000| 4,836,000| 1,996,000| 1,912,000| 3,908,000| 1,384,000 - 1902-3 | 3,185,000| 5,148,000| 1,980,000| 1,910,000| 3,890,000| 1,362,000 - 1903-4 | 2,977,000| 5,148,000| 1,980,000| 1,795,000| 3,775,000| 1,368,000 - 1904-5 | 3,572,000| 5,148,000| 2,112,000| 2,063,000| 4,175,000| 1,473,000 - 1905-6 | 3,766,000| 5,244,000| 2,364,000| 2,239,000| 4,603,000| 1,587,000 - 1906-7 | 3,915,000| 5,444,000| 2,460,000| 2,362,000| 4,822,000| 1,562,000 - -------+----------+----------+----------+----------+----------+---------- - - -World’s Supply and Distribution of Cotton. - -[From Latham, Alexander & Co.’s “Cotton Movement & Fluctuation,” 1902-7.] - - ==========+===========+==================================+ - | | Crops. | - | | | - |Visible and+-----------+----------+-----------+ - | Invisible | | | | - | Supply at | United | All | Total. | - Year. | beginning | States | Others. | | - | of year. | | | | - +-----------+-----------+----------+-----------+ - | Bales of 500 pounds each. - ----------+-----------+-----------+----------+-----------+ - 1884-5 | 1,550,000 | 5,136,000| 2,101,000| 7,237,000| - 1885-6 | 1,343,000 | 5,984,000| 2,234,000| 8,218,000| - 1886-7 | 1,441,000 | 5,960,000| 2,577,000| 8,537,000| - 1887-8 | 1,473,000 | 6,400,000| 2,309,000| 8,709,000| - 1888-9 | 1,291,000 | 6,463,000| 2,632,000| 9,095,000| - 1889-90 | 1,119,000 | 6,820,000| 2,933,000| 9,753,000| - 1890-1 | 1,077,000 | 8,137,000| 3,039,000| 11,176,000| - 1891-2 | 1,742,000 | 8,640,000| 3,001,000| 11,641,000| - 1892-3 | 2,818,000 | 6,435,000| 3,296,000| 9,731,000| - 1893-4 | 2,258,000 | 7,136,000| 3,314,000| 10,450,000| - 1894-5 | 2,128,000 | 9,640,000| 2,978,000| 12,618,000| - 1895-6 | 3,203,000 | 6,912,000| 3,421,000| 10,333,000| - 1896-7 | 1,931,000 | 8,435,868| 3,438,000| 11,873,868| - 1897-8 | 1,923,636 | 10,890,000| 3,316,290| 14,206,290| - 1898-9 | 3,241,158 | 11,078,000| 3,694,934| 14,772,934| - 1899-1900| 3,999,364 | 9,137,000| 3,092,897| 12,229,897| - 1900-1 | 2,456,489 | 10,218,000| 3,414,454| 13,632,454| - 1901-2 | 2,673,027 | 10,380,380| 4,038,569| 14,413,949| - 1902-3 | 2,672,068 | 10,511,020| 4,215,661| 14,726,687| - 1903-4 | 2,921,061 | 9,841,671| 4,317,670| 14,159,341| - 1904-5 | 2,770,244 | 13,420,440| 4,524,000| 17,944,056| - 1905-6 | 5,172,638 | 11,048,000| 4,612,553| 15,660,553| - 1906-7 | 4,504,382 | 13,346,000| 5,232,000| 18,578,000| - ----------+-----------+-----------+----------+-----------+ - - ==========+============+===================== - | | Balance of Supply - | | End of year. - | Total +----------+---------- - | Actual | | - |Consumption.| Visible. |Invisible. - Year. | | | - | | | - +------------+----------+---------- - | Bales of 500 pounds each. - ----------+------------+----------+---------- - 1884-5 | 7,444,000 | 984,000| 359,000 - 1885-6 | 8,120,000 | 968,000| 473,000 - 1886-7 | 8,505,000 | 999,000| 474,000 - 1887-8 | 8,891,000 | 772,000| 519,000 - 1888-9 | 9,267,000 | 682,000| 437,000 - 1889-90 | 9,795,000 | 846,000| 231,000 - 1890-1 | 10,511,000 | 1,315,000| 427,000 - 1891-2 | 10,565,000 | 2,310,000| 508,000 - 1892-3 | 10,291,000 | 1,903,000| 355,000 - 1893-4 | 10,580,000 | 1,792,000| 336,000 - 1894-5 | 11,543,000 | 2,185,000| 1,018,000 - 1895-6 | 11,605,000 | 1,231,000| 700,000 - 1896-7 | 11,880,332 | 1,295,636| 628,000 - 1897-8 | 12,888,768 | 1,905,158| 1,336,000 - 1898-9 | 14,014,728 | 2,371,364| 1,628,000 - 1899-1900| 13,772,772 | 1,071,489| 1,385,000 - 1900-1 | 13,415,916 | 1,549,027| 1,124,000 - 1901-2 | 14,414,908 | 1,306,068| 1,366,000 - 1902-3 | 14,477,694 | 1,177,677| 1,743,384 - 1903-4 | 14,310,158 | 1,085,237| 1,735,007 - 1904-5 | 15,541,667 | 2,501,469| 2,671,164 - 1905-6 | 16,328,804 | 1,702,485| 2,801,897 - 1906-7 | 17,005,640 | 2,215,497| 3,861,245 - ----------+------------+----------+---------- - - -Stocks of Money in Thirteen Principal Countries of the World in 1873, 293 -1896 and 1906. - -Relative increase in use of gold, silver and paper money illustrated. - - - ============================================================== - | Stock of Gold. | - Countries. +--------------+--------------+--------------+ - | 1873. | 1896. | 1906. | - ----------------+--------------+--------------+--------------+ - United States | $135,000,000| $696,300,000|$1,593,300,000| - Great Britain | 160,000,000| 584,000,000| 486,700,000| - France | 450,000,000| 772,000,000| 926,400,000| - Germany | 160,200,000| 654,500,000| 1,030,300,000| - Russia | 149,100,000| 586,900,000| 939,400,000| - Italy | 20,000,000| 96,900,000| 215,500,000| - Belgium | 25,000,000| 35,000,000| 31,100,000| - Netherlands | 12,000,000| 21,900,000| 45,900,000| - Austria-Hungary | 35,000,000| 178,500,000| 306,400,000| - Australasia | 50,000,000| 132,100,000| 125,000,000| - Denmark | 4,100,000| 15,400,000| 22,600,000| - Sweden | 1,800,000| 10,600,000| 22,600,000| - Norway | 7,600,000| 7,500,000| 8,300,000| - ----------------+--------------+--------------+--------------+ - Total | 1,209,800,000| 2,791,600,000| 5,753,500,000| - ----------------+--------------+--------------+--------------+ - - ============================================================== - | Stock of Silver. | - Countries. +--------------+--------------+--------------+ - | 1873. | 1896. | 1906. | - ----------------+--------------+--------------+--------------+ - United States | $ 6,150,000| $364,500,000| $698,700,000| - Great Britain | 95,000,000| 121,700,000| 116,800,000| - France | 500,000,000| 443,900,000| 411,100,000| - Germany | 306,235,000| 212,800,000| 219,700,000| - Russia | 18,600,000| 74,200,000| 77,900,000| - Italy | 23,000,000| 45,400,000| 31,700,000| - Belgium | 15,000,000| 57,000,000| 24,700,000| - Netherlands | 37,300,000| 56,100,000| 52,600,000| - Austria-Hungary | 40,000,000| 63,700,000| 105,300,000| - Australasia | 3,000,000| 7,000,000| 10,000,000| - Denmark | 7,500,000| 5,400,000| 6,100,000| - Sweden | 4,300,000| 4,900,000| 7,700,000| - Norway | 1,600,000| 2,000,000| 3,100,000| - ----------------+--------------+--------------+--------------+ - Total | 1,057,685,000| 1,728,600,000| 1,765,400,000| - ----------------+--------------+--------------+--------------+ - - ============================================================== - | Uncovered paper. | - Countries. +--------------+--------------+--------------+ - | 1873. | 1896. | 1906. | - ----------------+--------------+--------------+--------------+ - United States | $749,445,000| $397,000,000| $610,800,000| - Great Britain | 59,800,000| 112,100,000| 116,800,000| - France | 385,300,000| 119,200,000| 269,200,000| - Germany | 90,800,000| 123,800,000| 267,100,000| - Russia | 618,400,000| 467,200,000| No data. | - Italy | 87,800,000| 161,000,000| 150,600,000| - Belgium | 35,100,000| 72,500,000| 125,800,000| - Netherlands | 15,300,000| 37,900,000| 57,800,000| - Austria-Hungary | 265,800,000| 177,600,000| 119,300,000| - Australasia | .......... | 22,500,000| No data. | - Denmark | 6,500,000| 6,400,000| 10,700,000| - Sweden | 6,000,000| 19,000,000| 34,800,000| - Norway | 2,300,000| 3,800,000| 7,000,000| - ----------------+--------------+--------------+--------------+ - Total | 2,322,545,000| 1,720,000,000| 1,769,900,000| - ----------------+--------------+--------------+--------------+ - - =============================================================== - | Total money in countries named. - Countries. +--------------+--------------+---------------- - | 1873. | 1896. | 1906. - ----------------+--------------+--------------+---------------- - United States | $890,595,000|$1,727,800,000| $2,902,800,000 - Great Britain | 314,800,000| 817,800,000| 720,300,000 - France | 1,335,300,000| 1,335,100,000| 1,606,700,000 - Germany | 557,235,000| 991,100,000| 1,517,100,000 - Russia | 786,100,000| 1,128,300,000|[K]1,017,300,000 - Italy | 130,800,000| 303,300,000| 397,800,000 - Belgium | 75,100,000| 164,500,000| 181,600,000 - Netherlands | 64,600,000| 115,900,000| 156,300,000 - Austria-Hungary | 340,800,000| 419,800,000| 531,000,000 - Australasia | [K]53,000,000| 161,600,000| [K]135,000,000 - Denmark | 18,100,000| 27,200,000| 39,400,000 - Sweden | 12,100,000| 34,500,000| 65,100,000 - Norway | 11,500,000| 13,300,000| 18,400,000 - ----------------+--------------+--------------+---------------- - Total | 4,590,030,000| 7,240,200,000| 9,288,800,000 - ----------------+--------------+--------------+---------------- - - [K] Exclusive of uncovered paper, for which no data is available. - -Note.--The great increase in the use of capital in the manufacturing -industries in recent years seems to justify the presentation of this -table showing the general growth of money in the manufacturing -countries. - - -Annual Average Gold Production of the World. 294 - - ==============+===============++==============+============== - Period. | Gold--million || Period. | Gold--million - | dollars. || | dollars. - --------------+---------------++--------------+-------------- - 1493 to 1700 | 5.4 || 1901 to 1905 | 322.1 - 1701 to 1850 | 13.1 || 1906 | 400.3 - 1851 to 1890 | 120.2 || 1907 | 410.0 - 1891 to 1900 | 210.1 ||(estim.) 1908 | 444.0 - --------------+---------------++--------------+-------------- - - -The World’s Production of Pig Iron from 1800 to 1907. - -[In gross tons of 2240 lbs.] - - ======+================+=================+============+ - Year.| United | Great | Germany. | - | States. | Britain. | | - ------+----------------+-----------------+------------+ - | Tons. | Tons. | Tons. | - 1800 | 40,000 | 190,000 | 40,000 | - 1810 | 55,000 | 250,000 | 46,000 | - 1820 | 20,000 | 400,000 | 90,000 | - 1830 | 165,000 | 680,000 | 120,000 | - 1840 | 287,000 | 1,390,000 | 170,000 | - 1850 | 564,000 | 2,250,000 | 402,000 | - 1860 | 820,000 | 3,830,000 | 530,000 | - 1870 | 1,665,000 | 5,960,000 | 1,390,000 | - 1880 | 3,835,000 | 7,750,000 | 2,730,000 | - 1885 | 4,050,000 | 7,420,000 | 2,690,000 | - 1889 | 7,603,000 | 8,250,000 | 4,530,000 | - 1895 | 9,446,000 | 7,703,000 | 5,465,000 | - 1896 | 8,623,000 | 8,660,000 | 6,271,000 | - 1897 | 9,652,000 | 8,796,000 | 6,771,000 | - 1898 | 11,773,000 | 8,610,000 | 7,196,000 | - 1899 | 13,620,000 | 9,421,000 | 8,013,000 | - 1900 | 13,789,000 | 8,960,000 | 8,384,000 | - 1901 | 15,878,000 | 7,929,000 | 7,754,000 | - 1902 | 17,821,000 | 8,680,000 | 8,395,000 | - 1903 | 18,009,000 | 8,935,000 | 9,860.000 | - 1904 | 16,497,000 | 8,694,000 | 9,899,000 | - 1905 | 22,992,000 | 9,608,000 | 10,703,000 | - 1906 | 25,307,000 | 10,109,000 | 12,099,000 | - 1907 | 25,781,000 | 9,924,000 | 12,672,000 | - ------+----------------+-----------------+------------+ - - ======+================+================+============= - Year.| France. | Various. | Total. - | | | - ------+----------------+----------------+------------- - | Tons. | Tons. | Tons. - 1800 | 60,000 | 130,000 | 460,000 - 1810 | 85,000 | 180,000 | 616,000 - 1820 | 140,000 | 385,000 | 1,570,000 - 1830 | 220,000 | 480,000 | 2,677,000 - 1840 | 350,000 | 640,000 | 4,426,000 - 1850 | 570,000 | 270,000 | 920,000 - 1860 | 900,000 | 1,100,000 | 7,180,000 - 1870 | 1,180,000 | 1,710,000 | 11,905,000 - 1880 | 1,730,000 | 2,090,000 | 18,135,000 - 1885 | 1,630,000 | 2,310,000 | 18,100,000 - 1889 | 1,720,000 | 3,060,000 | 25,163,000 - 1895 | 2,006,000 | 4,247,000 | 28,867,000 - 1896 | 2,302,000 | 5,001,000 | 30,857,000 - 1897 | 2,444,000 | 5,267,000 | 32,930,000 - 1898 | 2,485,000 | 5,808,000 | 35,872,000 - 1899 | 2,537,000 | 6,464,000 | 40,055,000 - 1900 | 2,671,000 | 6,686,000 | 40,490,000 - 1901 | 2,351,000 | 6,886,000 | 40,798,000 - 1902 | 2,367,000 | 6,876,000 | 44,139,000 - 1903 | 2,796,000 | 6,677,000 | 46,277,000 - 1904 | 2,927,000 | 7,322,000 | 45,339,000 - 1905 | 3,028,000 | 7,569,000 | 53,900,000 - 1906 | 3,267,000 | 7,360,000 | 58,142,000 - 1907 | 3,532,000 | 7,591,000 |[L]59,500,000 - ------+----------------+----------------+------------- - - [L] Preliminary estimate. - -Note.--Official figures of the respective national statistical offices -of the United States, the United Kingdom, Germany and France. Figures -for all other countries taken from the French and Swedish Mineral -Statistics. - - -Commerce of the World since 1830. - -[Aggregate of imports for consumption and domestic exports in millions -of dollars.--Mulhall’s figures prior to 1890.] - - ========================+=======+=======+=======+=======+=======+ - Country. | 1830. | 1840. | 1850. | 1860. | 1870. | - ------------------------+-------+-------+-------+-------+-------+ - | | | | | | - United Kingdom | 422 | 547 | 811 | 1,800 | 2,625 | - France | 197 | 317 | 456 | 801 | 1,089 | - Germany | 220 | 249 | 336 | 624 | 1,017 | - Russia | 134 | 158 | 192 | 230 | 494 | - Austria-Hungary | 72 | 105 | 139 | 225 | 398 | - Italy | 96 | 144 | 182 | 249 | 317 | - Spain | 33 | 48 | 53 | 120 | 197 | - Portugal | 14 | 19 | 24 | 38 | 48 | - Holland and Belgium | 144 | 216 | 293 | 413 | 653 | - United States | 105 | 197 | 297 | 653 | 702 | - Spanish America | 168 | 230 | 336 | 451 | 648 | - India | 48 | 96 | 144 | 249 | 408 | - British colonies, other | 43 | 101 | 211 | 494 | 614 | - Other countries | 264 | 323 | 326 | 853 | 1,200 | - ------------------------+-------+-------+-------+-------+-------+ - The world | 1,960 | 2,750 | 3,800 | 7,200 |10,500 | - ------------------------+-------+-------+-------+-------+-------+ - - ========================+=======+=======+=======+=======+========= - Country. | 1880. | 1890. | 1897. | 1903. | 1907. - ------------------------+-------+-------+-------+-------+--------- - | | | | | - United Kingdom | 3,350 | 3,552 | 3,389 | 4,056 | 5,217 - France | 1,627 | 1,493 | 1,450 | 1,747 | 2,237 - Germany | 1,411 | 1,761 | 1,996 | 2,621 | 3,681 - Russia | 629 | 566 | 618 | 867 |[M][N]834 - Austria-Hungary | 513 | 441 | 609 | 813 | 949 - Italy | 437 | 451 | 438 | 652 | [M]821 - Spain | 240 | 283 | 301 | 257 | [M]325 - Portugal | 67 | 86 | 73 | 97 | [O]100 - Holland and Belgium | 1,137 | 1,488 | 1,915 | 2,614 | [M]3,010 - United States | 1,478 | 1,536 | 1,815 | 2,453 | 3,318 - Spanish America | 768 | 797 | 826 | 965 | 1,802 - India | 518 | 629 | 440 | 761 | [B]913 - British colonies, other | 974 | 1,430 | 1,550 | 2,292 | [O]2,169 - Other countries | 1,351 | 2,287 | 3,020 | 2,866 | [P]3,733 - ------------------------+-------+-------+-------+-------+--------- - The world |14,500 |16,800 |18,500 |23,061 | 29,109 - ------------------------+-------+-------+-------+-------+--------- - - [M] 1906. - - [N] Trade over the European frontier only. - - [O] 1904. - - [P] Various years, 1904 to 1906. - - -Imports and Exports of Manufactures into and from the Principal 295 -Countries of the World and the Share Which Manufactures Formed of -their Total Commerce. - -The Bureau of Statistics of the Department of Commerce and Labor -published in 1903 a series of tables showing the imports and exports -of manufactures of the principal countries of the world and the share -which manufactures formed, respectively, of the imports and exports of -each of the countries named. The following is a summarization of that -table: - - ================================+=======================+ - | | - | Iron and Steel. | - | | - Countries. +-----------+-----------+ - | Import. | Export. | - --------------------------------+-----------+-----------+ - Austria-Hungary (1901) |$13,942,000|$10,667,000| - Belgium (1902) | 19,083,000| 46,144,000| - Denmark (1901) | 9,415,000| 1,711,000| - France (1902) | 31,336,000| 42,238,000| - Germany (1901) | 42,186,000|207,951,000| - Italy (1901) | 31,318,000| 1,523,000| - Netherlands (1901) | 92,446,000| 58,045,000| - Portugal (1902) | 6,431,000| 249,000| - Russia-European frontier (1901) | 48,538,000| 818,000| - Spain (1902) | 19,448,000| 955,000| - Sweden (1902) | 11,916,000| 15,402,000| - Norway (1901) | 11,672,000| 963,000| - Switzerland (1902) | 17,366,000| 10,704,000| - United Kingdom (1902) | 74,685,000|298,945,000| - United States (1903) | 51,617,000| 96,642,000| - Canada (1902) | 34,727,000| -- | - Mexico (1901) | 18,457,000| -- | - Argentina (1902) | 18,343,000| -- | - Brazil (1901) | 7,034,000| -- | - China (1902) | 4,721,000| -- | - Japan (1902) | 13,878,000| -- | - India (1902) | 54,302,000| -- | - Australia (1901) | 36,066,000| -- | - New Zealand (1900) | 12,088,000| -- | - --------------------------------+-----------+-----------+ - ================================+=======================+ - | | - | Textiles. | - | | - Countries. +-----------+-----------+ - | Import. | Export. | - --------------------------------+-----------+-----------+ - Austria-Hungary (1901) |$34,696,000|$27,659,000| - Belgium (1902) | 21,652,000| 41,722,000| - Denmark (1901) | 12,699,000| 245,000| - France (1902) | 44,611,000|188,338,000| - Germany (1901) | 65,290,000|204,789,000| - Italy (1901) | 17,116,000| 36,399,000| - Netherlands (1901) | 41,172,000| 29,668,000| - Portugal (1902) | 7,253,000| 1,171,000| - Russia-European frontier (1901) | 23,728,000| 9,942,000| - Spain (1902) | 11,032,000| 6,977,000| - Sweden (1902) | 13,306,000| 796,000| - Norway (1901) | 8,886,000| 257,000| - Switzerland (1902) | 27,205,000| 76,447,000| - United Kingdom (1902) |175,194,000|547,325,000| - United States (1903) |146,202,000| 39,641,000| - Canada (1902) | 10,060,000| -- | - Mexico (1901) | 10,294,000| -- | - Argentina (1902) | 28,700,000| -- | - Brazil (1901) | 14,032,000| -- | - China (1902) | 79,580,000| -- | - Japan (1902) | 15,380,000| 31,729,000| - India (1902) |125,356,000| -- | - Australia (1901) | 54,540,000| -- | - New Zealand (1900) | 12,821,000| -- | - --------------------------------+-----------+-----------+ - ================================+========================+ - | | - | Other Manufactures. | - | | - Countries. +-----------+------------+ - | Import. | Export. | - --------------------------------+-----------+------------+ - Austria-Hungary (1901) |$65,350,000|$149,038,000| - Belgium (1902) | 63,475,000| 90,974,000| - Denmark (1901) | 17,741,000| 1,926,000| - France (1902) |136,645,000| 278,227,000| - Germany (1901) |259,193,000| 411,311,000| - Italy (1901) | 53,305,000| 37,451,000| - Netherlands (1901) |108,121,000| 143,797,000| - Portugal (1902) | 10,302,000| 1,946,000| - Russia-European frontier (1901) | 85,900,000| 45,309,000| - Spain (1902) | 27,463,000| 33,398,000| - Sweden (1902) | 26,613,000| 23,221,000| - Norway (1901) | 13,037,000| 10,863,000| - Switzerland (1902) | 48,478,000| 47,960,000| - United Kingdom (1902) |478,821,000| 294,861,000| - United States (1903) |369,310,000| 654,860,000| - Canada (1902) | 67,719,000| 18,076,000| - Mexico (1901) | 18,170,000| 9,178,000| - Argentina (1902) | 20,674,000| 704,000| - Brazil (1901) | 21,954,000| 43,000| - China (1902) | 56,239,000| -- | - Japan (1902) | 39,637,000| 28,173,000| - India (1902) | 74,123,000| -- | - Australia (1901) | 65,598.000| 13,754,000| - New Zealand (1900) | 16,732,000| 970,000| - --------------------------------+-----------+------------+ - ================================+=========================+=============== - | | Percent which - | Total Manufactures. | manufactures - | | form of total. - Countries. +------------+------------+-------+------- - | Import. | Export. |Import.|Export. - --------------------------------+------------+------------+-------+------- - Austria-Hungary (1901) |$113,988,000|$187,364,000| 32.63 | 48.35 - Belgium (1902) | 104,210,000| 178,840,000| 23.72 | 49.89 - Denmark (1901) | 39,855,000| 3,882,000| 37.47 | 4.96 - France (1902) | 212,592,000| 508,803,000| 24.95 | 62.22 - Germany (1901) | 366,669,000| 824,051,000| 28.42 | 78.13 - Italy (1901) | 101,739,000| 75,373,000| 30.68 | 28.50 - Netherlands (1901) | 241,739,000| 231,510,000| 29.54 | 33.27 - Portugal (1902) | 23,986,000| 3,366,000| 39.96 | 10.96 - Russia-European frontier (1901) | 158,166,000| 56,069,000| 56.37 | 14.45 - Spain (1902) | 57,943,000| 41,330,000| 37.60 | 29.04 - Sweden (1902) | 51,835,000| 39,419,000| 42.08 | 41.61 - Norway (1901) | 33,595,000| 12,083,000| 43.46 | 28.78 - Switzerland (1902) | 93,049,000| 135,111,000| 42.72 | 80.07 - United Kingdom (1902) | 728,700,000|1141,131,000| 27.92 | 82.70 - United States (1903) | 570,129,000| 791,143,000| 55.58 | 56.83 - Canada (1902) | 112,506,000| 18,076,000| 57.26 | 10.47 - Mexico (1901) | 46,921,000| 9,178,000| 75.11 | 27.78 - Argentina (1902) | 67,717,000| 704,000| 68.13 | .41 - Brazil (1901) | 43,020,000| 43,000| 44.87 | -- - China (1902) | 140,540,000| -- | 71.36 | -- - Japan (1902) | 69,895,000| 59,902,000| 51.73 | 47.05 - India (1902) | 253,781,000| -- | 88.15 | -- - Australia (1901) | 156,204,000| 13,754,000| 76.35 | 10.23 - New Zealand (1900) | 41,641,000| 970,000| 83.82 | 1.72 - --------------------------------+------------+------------+-------+------- - - -The Manufacturing Industry of the United States, 1850 to 1905, showing 296 -Value of Product, Capital Invested, Wage-Earners Employed, Wages Paid, -and Number of Establishments in each census year in the period under -consideration. - -[From official records of the United States Census Office.] - - -----------------------------------------+------------------------------ - | Date of Census. | - +--------------+--------------+ - | | | - | 1850 | 1860 | - | | | - -----------------------------------------+--------------+--------------+ - Number of establishments | 123,025| 140,433| - Capital | $533,245,351|$1,009,855,715| - Salaried officials, clerks, etc., Number | [S] | [S] | - Salaries | [S] | [S] | - Wage-earners, average number | 957,059| 1,311,246| - Total wages | $236,755,464| $378,878,966| - Men, 16 years and over | 731,137| 1,040,349| - Wages | [S] | [S] | - Women, 16 years and over | 2,225,922| 270,897| - Wages | [S] | [S] | - Children, under 16 years | [S] | [S] | - Wages | [S] | [S] | - Miscellaneous expenses | [U] | [U] | - Cost of materials used | $555,123,822|$1,031,605,092| - Value of products, including | | | - custom work and repairing. |$1,019,106,616|$1,885,861,676| - =========================================+==============+==============+ - -----------------------------------------+-----------------------------+ - | Date of Census. | - +--------------+--------------+ - | | | - | 1870 | 1880 | - | | | - -----------------------------------------+--------------+--------------+ - Number of establishments | 252,148| 253,852| - Capital |$2,118,208,769 $2,790,272,606| - Salaried officials, clerks, etc., Number | [S] | [S] | - Salaries | [S] | [S] | - Wage-earners, average number | 2,053,996| 2,732,595| - Total wages | $775,584,343| $947,953,795| - Men, 16 years and over | 1,615,598| 2,019,035| - Wages | [S] | [S] | - Women, 16 years and over | 323,770| 531,639| - Wages | [S] | [S] | - Children, under 16 years | 114,628| 181,921 | - Wages | [S] | [S] | - Miscellaneous expenses | [U] | [U] | - Cost of materials used |$2,488,427,242|$3,396,823,549| - Value of products, including | | | - custom work and repairing. |$4,232,325,442|$5,369,579,191| - =========================================+==============+==============+ - -----------------------------------------+---------------------------------+ - | Date of Census. | - +-----------------+---------------+ - | | | - | 1890 | 1900.[Q] | - | | | - -----------------------------------------+-----------------+---------------+ - Number of establishments | 355,475 | 512,254| - Capital |$6,525,156,486 | $9,817,434,799| - Salaried officials, clerks, etc., Number | 461,609[R]| 396,759| - Salaries | $391,988,208[R]| $403,711,233| - Wage-earners, average number | 4,251,613 | 5,308,406| - Total wages |$1,891,228,321 | $2,322,333,877| - Men, 16 years and over | 3,327,042 | 4,110,527| - Wages |$1,659,234,483 | $2,016,677,789| - Women, 16 years and over | 803,686 | 1,029,296| - Wages | $215,367,976 | $279,994,396| - Children, under 16 years | 120,885 | 168,583| - Wages | $16,625,862 | $25,661,692| - Miscellaneous expenses | $631,225,035 | $1,027,775,778| - Cost of materials used |$5,162,044,076 | $7,345,413,651| - Value of products, including | | | - custom work and repairing. |$9,372,437,283 |$13,004,400,143| - =========================================+=================+===============+ - -----------------------------------------+---------------+ - |Date of Census.| - +---------------+ - | | - | 1905. | - | | - -----------------------------------------+---------------+ - Number of establishments | 588,769| - Capital |$13,872,035,371| - Salaried officials, clerks, etc., Number | 566,175| - Salaries | $609,200,251| - Wage-earners, average number | 6,152,443| - Total wages | $3,014,389,372| - Men, 16 years and over | 4,792,874| - Wages | $2,629,747,837| - Women, 16 years and over | 1,194,083| - Wages | $356,992,855| - Children, under 16 years | 167,066| - Wages | $29,228,667| - Miscellaneous expenses | $1,651,603,535| - Cost of materials used | $9,497,619,851| - Value of products, including | | - custom work and repairing. |$16,866,706,985| - =========================================+===============+ - -----------------------------------------+--------------------- - |Per cent of Increase. - +------+------+------+ - | 1850 | 1860 | 1870 | - | to | to | to | - | 1860 | 1870 | 1880 | - -----------------------------------------+------+------+------+ - Number of establishments | 14.1 | 79.6| 0.7 | - Capital | 89.4 | 109.3| 31.7 | - Salaried officials, clerks, etc., Number | -- | -- | -- | - Salaries | -- | -- | -- | - Wage-earners, average number | 37.0 | 56.6| 33.0 | - Total wages | 60.0 | 104.7| 22.2 | - Men, 16 years and over | 42.3 | 55.3| 25.0 | - Wages | -- | -- | -- | - Women, 16 years and over | 19.9 | 19.5| 64.2 | - Wages | -- | -- | -- | - Children, under 16 years | -- | -- | 58.7 | - Wages | -- | -- | -- | - Miscellaneous expenses | -- | -- | -- | - Cost of materials used | 85.8 | 141.2| 36.5 | - Value of products, including | | | | - custom work and repairing. | 85.1 | 124.4| 26.9 | - =========================================+======+======+======+ - -----------------------------------------+----------------------- - |Per cent of Increase. - +--------+--------+----- - | 1880 | 1890 | 1900 - | to | to | to - | 1890 | 1900 | 1910 - -----------------------------------------+--------+--------+----- - Number of establishments | 40.0 | 44.1 | 4.2 - Capital |133.9 | 50.5 | 41.3 - Salaried officials, clerks, etc., Number | -- | 13.9[T]| 42.7 - Salaries | -- | 3.0 | 50.9 - Wage-earners, average number | 55.6 | 24.9 | 15.9 - Total wages | 99.5 | 22.8 | 29.8 - Men, 16 years and over | 64.8 | 23.5 | 16.6 - Wages | -- | 21.5 | 30.4 - Women, 16 years and over | 51.2 | 28.1 | 16.0 - Wages | -- | 30.0 | 27.5 - Children, under 16 years | 33.6[T]| 39.5 | 0.9 - Wages | -- | 54.3 | 13.9 - Miscellaneous expenses | -- | 62.8 | 60.7 - Cost of materials used | 52.0 | 42.3 | 29.3 - Value of products, including | | | - custom work and repairing. | 74.5 | 38.8 | 29.7 - =========================================+========+========+===== - - [Q] Includes, for comparative purposes, 85 governmental - establishments in the District of Columbia having products - valued at $9,887,355, the statistics of such establishments for - 1890 not being separable. Totals for 1900 and 1905 are exclusive - of statistics for governmental establishments and for Hawaii. - - [R] Includes proprietors and firm members, with their salaries; - number only reported in 1900, but not included in this table. - - [S] Not reported separately. - - [T] Decrease. - - [U] Not reported. - - -Manufactures in the U. S.: Gross and Net Values of Products, Census 297 -Years 1900 and 1905, by Industry Groups. - -The gross value of manufactures as reported by the census contains -many duplications because the finished products of some factories -frequently become the material for other factories. In this way not -only one but several duplications of the cost of materials often -occur. The net value of productions eliminates these duplications by -deducting from the gross value the cost of all materials which have -undergone any process of manufacture covered by the census reports on -manufactures. For further explanation of the relation of “gross” and -“net” values, see page 211. - -[From reports of the Bureau of the Census, Department of Commerce and Labor.] - - ==================================+========================================+ - | 1900.[V] | - +--------------------+-------------------+ - Group. | Gross. | Net. | - +--------------+-----+-------------+-----+ - | Value. |Rank.| Value. |Rank.| - | Dollars. | | Dollars. | | - ----------------------------------+--------------+-----+-------------+-----+ - Food and kindred products | 2,273,880,874| 1 |1,750,811,817| 1 | - Textiles | 1,637,484,484| 3 |1,081,961,248| 2 | - Iron and steel and their products | 1,793,490,908| 2 | 983,821,918| 3 | - Lumber and its remanufactures | 1,030,695,350| 5 | 547,227,860| 6 | - Leather and its finished products | 583,731,046| 9 | 329,614,996| 11 | - Paper and printing | 606,317,768| 8 | 419,798,101| 7 | - Liquors and beverages | 425,504,167| 12 | 349,157,618| 10 | - Chemicals and allied products | 552,797,877| 10 | 372,538,857| 8 | - Clay, glass, and stone products | 293,564,235| 13 | 245,447,118| 14 | - Metals and metal products, - other than iron & steel | 748,795,464| 7 | 371,154,446| 9 | - Tobacco | 283,076,546| 14 | 264,052,573| 12 | - Vehicles for land transportation | 508,524,510| 11 | 250,622,377| 13 | - Shipbuilding | 74,578,158| 15 | 42,492,518| 15 | - Miscellaneous industries | 1,004,092,294| 6 | 638,191,538| 5 | - Hand trades | 1,183,615,478| 4 | 721,104,859| 4 | - ----------------------------------+--------------+-----+-------------+-----+ - Total |13,000,149,159| -- |8,367,997,844| -- | - ----------------------------------+--------------+-----+-------------+-----+ - ==================================+========================================= - | 1905. - +--------------------+-------------------- - Group. | Gross. | Net. - +--------------+-----+--------------+----- - | Value. |Rank.| Value. |Rank. - | Dollars. | | Dollars. | - ----------------------------------+--------------+-----+--------------+----- - Food and kindred products | 2,845,234,900| 1 | 2,176,489,626| 1 - Textiles | 2,147,441,418| 3 | 1,397,009,940| 2 - Iron and steel and their products | 2,176,739,726| 2 | 1,239,490,273| 3 - Lumber and its remanufactures | 1,223,730,336| 4 | 805,315,333| 4 - Leather and its finished products | 705,747,470| 9 | 401,011,414| 10 - Paper and printing | 857,112,256| 8 | 596,872,350| 7 - Liquors and beverages | 501,266,605| 11 | 431,735,208| 9 - Chemicals and allied products | 1,031,965,263| 5 | 714,489,549| 5 - Clay, glass, and stone products | 391,230,422| 12 | 334,971,057| 11 - Metals and metal products, - other than iron & steel | 922,262,456| 7 | 442,912,699| 8 - Tobacco | 331,117,681| 13 | 307,100,175| 13 - Vehicles for land transportation | 643,924,442| 10 | 324,109,901| 12 - Shipbuilding | 82,769,239| 14 | 46,707,258| 14 - Miscellaneous industries | 941,604,873| 6 | 602,990,604| 6 - Hand trades | [W] | [W] | [W] | [W] - ----------------------------------+--------------+-----+--------------+----- - Total |14,802,147,087| -- | 9,821,205,387| -- - ----------------------------------+--------------+-----+--------------+----- - - [V] The figures of production for 1900 exclude 10 lumber - establishments reported for Alaska with products valued at - $4,250,984. - - [W] “Hand trades” not included in the Census of 1905. - - -Manufactures: Percentage Distribution, by Groups of States, Census 298 -Years 1850 to 1905. - -[From reports of the Bureau of the Census, Department of Commerce and -Labor.] - - =====================+==========+========+===============+ - | | | Wage-earners. | - Group of States and |Establish-|Capital.+-------+-------+ - census years.[X] | ments. | |Average| | - | | |number.| Wages.| - ---------------------+----------+--------+-------+-------+ - | Per | Per | Per | Per | - | cent. | cent. | cent. | cent. | - | | | | | - New England States: | | | | | - 1850 | 18.3 | 31.1 | 32.7 | 31.8 | - 1860 | 14.7 | 25.5 | 29.9 | 27.5 | - 1870 | 12.8 | 23.1 | 25.7 | 27.2 | - 1880 | 12.4 | 22.4 | 23.7 | 23.9 | - 1890 | 13.6 | 18.0 | 19.3 | 19.0 | - 1900 | 10.9 | 16.8 | 18.1 | 18.3 | - 1905 | 10.3 | 14.7 | 17.2 | 16.8 | - Middle States: | | | | | - 1850 | 43.9 | 44.2 | 43.9 | 44.3 | - 1860 | 37.9 | 43.1 | 41.6 | 40.2 | - 1870 | 34.7 | 42.7 | 39.2 | 41.4 | - 1880 | 35.3 | 42.1 | 41.7 | 42.8 | - 1890 | 35.2 | 39.2 | 38.5 | 40.8 | - 1900 | 34.1 | 40.7 | 36.6 | 38.4 | - 1905 | 33.6 | 39.5 | 36.7 | 37.3 | - Southern States: | | | | | - 1850 | 16.7 | 12.6 | 11.5 | 9.5 | - 1860 | 17.2 | 11.5 | 10.1 | 9.2 | - 1870 | 15.4 | 6.6 | 9.1 | 5.8 | - 1880 | 14.6 | 6.9 | 8.2 | 5.6 | - 1890 | 13.1 | 7.8 | 9.7 | 7.1 | - 1900 | 15.1 | 9.0 | 13.3 | 9.2 | - 1905 | 15.3 | 11.0 | 14.0 | 10.7 | - Central States: | | | | | - 1850 | 20.2 | 11.8 | 11.5 | 12.7 | - 1860 | 23.4 | 17.1 | 14.2 | 14.9 | - 1870 | 33.5 | 24.4 | 23.8 | 22.6 | - 1880 | 32.3 | 25.1 | 23.6 | 24.1 | - 1890 | 31.8 | 29.7 | 28.2 | 27.6 | - 1900 | 32.0 | 27.8 | 27.4 | 28.3 | - 1905 | 31.3 | 28.2 | 27.0 | 28.4 | - Western States: | | | | | - 1850 | [Y] | [Y] | [Y] | [Y] | - 1860 | .5 | .4 | .3 | .4 | - 1870 | 1.5 | 1.0 | .8 | 1.1 | - 1880 | 2.6 | 1.0 | 1.0 | 1.1 | - 1890 | 3.2 | 2.0 | 1.8 | 2.2 | - 1900 | 3.9 | 2.9 | 2.0 | 2.5 | - 1905 | 4.2 | 3.2 | 2.1 | 2.7 | - Pacific States: | | | | | - 1850 | .9 | .3 | .4 | 1.7 | - 1860 | 6.3 | 2.4 | 3.9 | 7.8 | - 1870 | 2.1 | 2.2 | 1.4 | 1.9 | - 1880 | 2.8 | 2.5 | 1.8 | 2.5 | - 1890 | 3.1 | 3.3 | 2.5 | 3.3 | - 1900 | 4.0 | 2.1 | 2.6 | 3.2 | - 1905 | 5.2 | 3.3 | 3.0 | 4.1 | - Alaska: | | | | | - 1890 | [Y] | [Y] | [Y] | [Y] | - 1900 | [Y] | .1 | [Y] | .1 | - 1905 | .1 | .1 | [Y] | [Y] | - ---------------------+----------+--------+-------+-------+ - =====================+=========+=========+========= - | | | - Group of States and | Miscel- | Cost of | Value - census years.[X] | laneous |materials| of - |expenses.| used. |products. - ---------------------+---------+---------+--------- - | Per | Per | Per - | cent. | cent. | cent. - | | | - New England States: | | | - 1850 | -- | 27.6 | 27.8 - 1860 | -- | 23.8 | 24.8 - 1870 | -- | 24.3 | 23.8 - 1880 | -- | 19.4 | 20.6 - 1890 | 15.7 | 15.3 | 16.0 - 1900 | 12.2 | 13.8 | 14.6 - 1905 | 11.5 | 13.1 | 13.7 - Middle States: | | | - 1850 | -- | 47.9 | 46.4 - 1860 | -- | 43.1 | 42.5 - 1870 | -- | 41.7 | 41.8 - 1880 | -- | 41.1 | 41.3 - 1890 | 36.3 | 38.1 | 38.9 - 1900 | 39.1 | 37.6 | 38.1 - 1905 | 38.7 | 37.0 | 37.3 - Southern States: | | | - 1850 | -- | 9.5 | 9.9 - 1860 | -- | 10.6 | 10.3 - 1870 | -- | 6.5 | 6.6 - 1880 | -- | 6.3 | 6.3 - 1890 | 8.2 | 7.4 | 7.5 - 1900 | 9.1 | 8.6 | 8.9 - 1905 | 10.1 | 10.2 | 10.5 - Central States: | | | - 1850 | -- | 14.5 | 14.3 - 1860 | -- | 19.5 | 18.1 - 1870 | -- | 24.9 | 24.9 - 1880 | -- | 29.4 | 28.0 - 1890 | 34.7 | 32.5 | 31.4 - 1900 | 35.6 | 31.4 | 30.9 - 1905 | 34.3 | 30.7 | 30.5 - Western States: | | | - 1850 | -- | .1 | .1 - 1860 | -- | .2 | .4 - 1870 | -- | 1.0 | 1.1 - 1880 | -- | 1.4 | 1.4 - 1890 | 2.4 | 3.6 | 3.0 - 1900 | 1.9 | 5.2 | 4.3 - 1905 | 2.4 | 5.3 | 4.3 - Pacific States: | | | - 1850 | -- | .4 | 1.5 - 1860 | -- | 2.8 | 3.9 - 1870 | -- | 1.6 | 1.8 - 1880 | -- | 2.4 | 2.4 - 1890 | 2.7 | 3.1 | 3.2 - 1900 | 2.1 | 3.4 | 3.2 - 1905 | 2.9 | 3.7 | 3.7 - Alaska: | | | - 1890 | [Y] | [Y] | [Y] - 1900 | [Y] | [Y] | [Y] - 1905 | .1 | [Y] | [Y] - ---------------------+---------+---------+--------- - - [X] New England States: Maine, New Hampshire, Vermont, - Massachusetts, Rhode Island, Connecticut. Middle States: New - York, New Jersey, Pennsylvania, Delaware, Maryland, District of - Columbia. Southern States: Virginia, West Virginia, North - Carolina, South Carolina, Georgia, Florida, Kentucky, Tennessee, - Alabama, Mississippi, Arkansas, Louisiana, Indian Territory, - Oklahoma, Texas. Central States: Ohio, Michigan, Indiana, - Illinois, Wisconsin, Minnesota, Iowa, Missouri. Western States: - Montana, Idaho, Wyoming, North Dakota, South Dakota, Nebraska, - Nevada, Utah, Colorado, Kansas, Arizona, New Mexico. Pacific - States: Washington, Oregon, California. - - [Y] Less than one-tenth of 1 per cent. - - -Summary of Manufactures in the U. S., by States and Territories, 299 -Census Years 1900 and 1905. - -[From reports of the Bureau of the Census, Department of Commerce and Labor.] - - =================+======+==========+==============+=======================+ - | | | | Wage-earners. | - State or |Census|Number of | +---------+-------------+ - Territory. | year.|establish-| Capital. | Average | Total | - | | ments. | | number. | wages. | - | | | | | | - -----------------+------+----------+--------------+---------+-------------+ - | | | Dollars. | | Dollars. | - United States | 1900 | 207,562 | 8,978,825,200|4,715,023|2,009,735,799| - | 1905 | 216,262 |12,686,265,673|5,470,321|2,611,540,532| - =================+======+==========+==============+=========+=============+ - Alabama | 1900 | 2,000 | 60,165,904| 52,711| 14,911,683| - | 1905 | 1,882 | 105,382,859| 62,173| 21,878,451| - Alaska | 1900 | 48 | 3,568,704| 2,260| 1,374,680| - | 1905 | 82 | 10,684,799| 1,938| 1,095,579| - Arizona | 1900 | 154 | 9,517,578| 3,126| 2,287,352| - | 1905 | 169 | 14,395,654| 4,793| 3,969,248| - Arkansas | 1900 | 1,746 | 25,384,636| 31,525| 10,184,154| - | 1905 | 1,907 | 46,306,116| 33,089| 14,543,635| - California | 1900 | 4,997 | 175,467,806| 77,224| 39,889,997| - | 1905 | 6,839 | 282,647,201| 100,355| 64,656,686| - Colorado | 1900 | 1,323 | 58,172,865| 19,498| 11,707,566| - | 1905 | 1,606 | 107,663,500| 21,813| 15,100,365| - Connecticut | 1900 | 3,382 | 299,206,925| 159,733| 73,394,062| - | 1905 | 3,477 | 373,283,580| 181,605| 87,942,628| - Delaware | 1900 | 633 | 38,791,402| 20,562| 8,457,003| - | 1905 | 631 | 50,925,630| 18,475| 8,158,203| - Dist. of Columbia| 1900 | 491 | 17,960,498| 6,155| 3,022,906| - | 1905 | 482 | 20,199,783| 6,299| 3,658,370| - Florida | 1900 | 1,275 | 25,682,171| 35,471| 10,916,443| - | 1905 | 1,413 | 32,971,982| 42,091| 15,767,182| - Georgia | 1900 | 3,015 | 79,303,316| 83,336| 19,958,153| - | 1905 | 3,219 | 135,211,551| 92,749| 27,392,442| - Idaho | 1900 | 287 | 2,130,112| 1,552| 818,239| - | 1905 | 364 | 9,689,445| 3,061| 2,059,391| - Illinois | 1900 | 14,374 | 732,829,771| 332,871| 159,104,179| - | 1905 | 14,921 | 975,844,799| 379,436| 208,405,468| - Indian Territory | 1900 | 179 | 1,591,953| 1,087| 379,188| - | 1905 | 466 | 5,016,654| 2,257| 1,144,078| - Indiana | 1900 | 7,128 | 219,321,080| 139,017| 59,280,131| - | 1905 | 7,044 | 312,071,234| 154,174| 72,058,099| - Iowa | 1900 | 4,828 | 85,667,334| 44,420| 18,020,653| - | 1905 | 4,785 | 111,427,429| 49,481| 22,997,053| - Kansas | 1900 | 2,299 | 59,458,256| 27,119| 12,802,096| - | 1905 | 2,475 | 88,680,117| 35,570| 18,883,071| - Kentucky | 1900 | 3,648 | 87,995,822| 51,735| 18,454,252| - | 1905 | 3,734 | 147,282,478| 59,794| 24,438,684| - Louisiana | 1900 | 1,826 | 100,874,729| 40,878| 14,725,437| - | 1905 | 2,091 | 150,810,608| 55,859| 25,315,750| - Maine | 1900 | 2,878 | 114,007,715| 69,914| 25,730,735| - | 1905 | 3,145 | 143,707,750| 74,958| 32,691,759| - Maryland | 1900 | 3,886 | 149,155,313| 94,170| 32,414,429| - | 1905 | 3,852 | 201,877,966| 94,174| 36,144,244| - Massachusetts | 1900 | 10,929 | 781,867,715| 438,234| 195,278,276| - | 1905 | 10,723 | 965,948,887| 488,399| 232,388,946| - Michigan | 1900 | 7,310 | 246,996,529| 155,800| 62,531,812| - | 1905 | 7,446 | 337,894,102| 175,229| 81,278,837| - Minnesota | 1900 | 4,096 | 133,076,669| 64,557| 29,029,190| - | 1905 | 4,756 | 184,903,271| 69,636| 35,843,145| - Mississippi | 1900 | 1,294 | 22,712,186| 26,799| 7,909,607| - | 1905 | 1,520 | 50,256,309| 38,690| 14,819,034| - Missouri | 1900 | 6,853 | 223,781,088| 107,704| 46,713,734| - | 1905 | 6,464 | 379,368,827| 133,167| 66,644,126| - Montana | 1900 | 395 | 38,224,915| 9,854| 7,376,822| - | 1905 | 382 | 52,589,810| 8,957| 8,652,217| - Nebraska | 1900 | 1,695 | 65,906,052| 18,669| 8,842,429| - | 1905 | 1,819 | 80,235,310| 20,260| 11,022,149| - Nevada | 1900 | 99 | 1,251,208| 504| 352,606| - | 1905 | 115 | 2,891,997| 802| 693,407| - New Hampshire | 1900 | 1,771 | 92,146,025| 67,646| 25,849,631| - | 1905 | 1,618 | 109,495,072| 65,366| 27,693,203| - New Jersey | 1900 | 6,415 | 477,301,565| 213,975| 95,164,913| - | 1905 | 7,010 | 715,060,174| 266,336| 128,168,801| - New Mexico | 1900 | 174 | 2,160,718| 2,490| 1,199,496| - | 1905 | 199 | 4,638,248| 3,478| 2,153,068| - New York | 1900 | 35,957 | 1,523,502,651| 726,909| 337,323,585| - | 1905 | 37,194 | 2,031,459,515| 856,947| 430,014,851| - North Carolina | 1900 | 3,465 | 68,283,005| 72,322| 14,051,784| - | 1905 | 3,272 | 141,000,639| 85,339| 21,375,294| - North Dakota | 1900 | 337 | 3,511,968| 1,358| 671,321| - | 1905 | 507 | 5,703,837| 1,755| 1,031,307| - Ohio | 1900 | 13,868 | 570,908,968| 308,109| 136,427,579| - | 1905 | 13,785 | 856,988,830| 364,298| 182,429,425| - Oklahoma | 1900 | 316 | 2,462,438| 1,294| 514,879| - | 1905 | 657 | 11,107,763| 3,199| 1,655,324| - Oregon | 1900 | 1,406 | 28,359,089| 14,459| 6,822,011| - | 1905 | 1,602 | 44,023,548| 18,523| 11,443,512| - Pennsylvania | 1900 | 23,462 | 1,449,814,740| 663,960| 296,875,548| - | 1905 | 23,495 | 1,995,836,988| 763,282| 367,960,890| - Rhode Island | 1900 | 1,678 | 176,901,606| 88,197| 35,995,101| - | 1905 | 1,617 | 215,901,375| 97,318| 43,112,637| - South Carolina | 1900 | 1,369 | 62,750,027| 47,025| 9,130,269| - | 1905 | 1,399 | 113,422,224| 59,441| 13,868,950| - South Dakota | 1900 | 624 | 6,051,288| 2,224| 1,129,787| - | 1905 | 686 | 7,585,142| 2,492| 1,421,680| - Tennessee | 1900 | 3,116 | 63,140,657| 45,963| 14,727,506| - | 1905 | 3,175 | 102,439,481| 60,572| 22,805,628| - Texas | 1900 | 3,107 | 63,655,616| 38,604| 16,911,681| - | 1905 | 3,158 | 115,664,871| 49,066| 24,468,942| - Utah | 1900 | 575 | 13,219,039| 5,413| 2,762,522| - | 1905 | 606 | 26,004,011| 8,052| 5,157,400| - Vermont | 1900 | 1,938 | 43,499,633| 28,179| 11,426,548| - | 1905 | 1,699 | 62,658,741| 33,106| 15,221,059| - Virginia | 1900 | 3,186 | 92,299,589| 66,223| 20,273,889| - | 1905 | 3,187 | 147,989,182| 80,285| 27,943,058| - Washington | 1900 | 1,926 | 41,574,744| 31,523| 17,065,140| - | 1905 | 2,751 | 96,952,621| 45,199| 30,087,287| - West Virginia | 1900 | 1,824 | 49,103,138| 33,080| 12,639,856| - | 1905 | 2,109 | 86,820,823| 43,758| 21,153,042| - Wisconsin | 1900 | 7,841 | 286,060,566| 137,525| 55,695,816| - | 1905 | 8,558 | 412,647,051| 151,391| 71,471,805| - Wyoming | 1900 | 139 | 2,047,883| 2,060| 1,209,123| - | 1905 | 169 | 2,695,889| 1,834| 1,261,122| - -----------------+------+----------+--------------+---------+-------------+ - =================+======+==============+============== - | | | Value of - State or |Census| Cost of | products, - Territory. | year.| materials | including - | | used. | custom work - | | |and repairing. - -----------------+------+--------------+-------------- - | | Dollars. | Dollars. - United States | 1900 | 6,577,614,074|11,411,121,122 - | 1905 | 8,503,949,756|14,802,147,087 - =================+======+==============+============== - Alabama | 1900 | 37,998,233| 72,109,929 - | 1905 | 60,458,368| 109,169,922 - Alaska | 1900 | 1,762,583| 4,194,421 - | 1905 | 3,741,946| 8,244,524 - Arizona | 1900 | 7,876,542| 20,438,987 - | 1905 | 14,595,057| 28,083,192 - Arkansas | 1900 | 18,288,045| 39,887,578 - | 1905 | 21,799,346| 53,864,394 - California | 1900 | 164,894,269| 257,385,521 - | 1905 | 215,726,414| 367,218,494 - Colorado | 1900 | 60,750,784| 89,067,879 - | 1905 | 63,114,397| 100,143,999 - Connecticut | 1900 | 169,671,648| 315,106,150 - | 1905 | 191,801,881| 369,082,091 - Delaware | 1900 | 24,725,317| 41,321,061 - | 1905 | 24,883,806| 41,160,276 - Dist. of Columbia| 1900 | 7,475,216| 16,426,408 - | 1905 | 7,731,971| 18,359,159 - Florida | 1900 | 12,847,187| 34,183,509 - | 1905 | 16,532,439| 50,298,290 - Georgia | 1900 | 49,356,296| 94,532,368 - | 1905 | 83,624,504| 151,040,455 - Idaho | 1900 | 1,438,868| 3,001,442 - | 1905 | 4,068,523| 8,768,743 - Illinois | 1900 | 681,450,122| 1,120,868,308 - | 1905 | 840,057,316| 1,410,342,129 - Indian Territory | 1900 | 1,697,829| 2,629,067 - | 1905 | 4,848,646| 7,909,451 - Indiana | 1900 | 195,162,566| 337,071,630 - | 1905 | 220,507,007| 393,954,405 - Iowa | 1900 | 85,778,867| 132,870,865 - | 1905 | 102,843,892| 160,572,313 - Kansas | 1900 | 120,737,677| 154,008,544 - | 1905 | 156,509,949| 198,244,992 - Kentucky | 1900 | 67,406,202| 126,508,660 - | 1905 | 86,545,464| 159,753,968 - Louisiana | 1900 | 75,403,937| 111,397,919 - | 1905 | 117,035,305| 186,379,592 - Maine | 1900 | 61,210,327| 112,959,098 - | 1905 | 80,042,090| 144,020,197 - Maryland | 1900 | 129,354,412| 211,076,143 - | 1905 | 150,024,066| 243,375,996 - Massachusetts | 1900 | 498,655,033| 907,626,439 - | 1905 | 626,410,431| 1,124,092,051 - Michigan | 1900 | 175,966,128| 319,691,856 - | 1905 | 230,080,931| 429,120,060 - Minnesota | 1900 | 150,299,277| 223,692,922 - | 1905 | 210,553,949| 307,858,073 - Mississippi | 1900 | 16,543,029| 33,718,517 - | 1905 | 25,800,885| 57,451,445 - Missouri | 1900 | 184,189,030| 316,304,095 - | 1905 | 252,258,417| 439,548,957 - Montana | 1900 | 30,068,101| 52,744,997 - | 1905 | 40,930,060| 66,415,452 - Nebraska | 1900 | 95,925,178| 130,302,453 - | 1905 | 124,051,628| 154,918,220 - Nevada | 1900 | 662,284| 1,261,005 - | 1905 | 1,627,776| 3,096,274 - New Hampshire | 1900 | 60,163,380| 107,590,803 - | 1905 | 73,216,387| 123,610,904 - New Jersey | 1900 | 334,726,094| 553,005,684 - | 1905 | 470,449,176| 774,369,025 - New Mexico | 1900 | 1,998,593| 4,060,924 - | 1905 | 2,235,934| 5,705,880 - New York | 1900 | 1,018,377,186| 1,871,830,872 - | 1905 | 1,348,603,286| 2,488,345,579 - North Carolina | 1900 | 44,854,224| 85,274,083 - | 1905 | 79,268,004| 142,520,776 - North Dakota | 1900 | 4,150,860| 6,259,840 - | 1905 | 7,095,986| 10,217,914 - Ohio | 1900 | 409,302,501| 748,670,855 - | 1905 | 527,636,585| 960,811,857 - Oklahoma | 1900 | 3,732,618| 5,504,869 300 - | 1905 | 11,545,306| 16,549,656 - Oregon | 1900 | 20,788,833| 36,592,714 - | 1905 | 30,596,763| 55,525,123 - Pennsylvania | 1900 | 958,301,272| 1,649,882,380 - | 1905 | 1,142,942,707| 1,955,551,332 - Rhode Island | 1900 | 87,951,780| 165,550,382 - | 1905 | 112,872,261| 202,109,583 - South Carolina | 1900 | 30,485,861| 53,335,811 - | 1905 | 49,968,626| 79,376,262 - South Dakota | 1900 | 6,483,677| 9,529,946 - | 1905 | 8,696,831| 13,085,333 - Tennessee | 1900 | 54,559,039| 92,749,129 - | 1905 | 79,351,746| 137,960,476 - Texas | 1900 | 54,388,303| 92,894,433 - | 1905 | 91,603,630| 150,528,389 - Utah | 1900 | 11,440,250| 17,981,648 - | 1905 | 24,939,827| 38,926,464 - Vermont | 1900 | 26,384,812| 51,515,228 - | 1905 | 32,429,852| 63,083,611 - Virginia | 1900 | 59,359,484| 108,644,150 - | 1905 | 83,649,149| 148,856,525 - Washington | 1900 | 38,276,944| 70,831,345 - | 1905 | 66,166,165| 128,821,667 - West Virginia | 1900 | 37,228,253| 67,006,822 - | 1905 | 54,419,206| 99,040,676 - Wisconsin | 1900 | 185,695,393| 326,752,878 - | 1905 | 227,255,092| 411,139,681 - Wyoming | 1900 | 1,369,730| 3,268,555 - | 1905 | 1,300,773| 3,523,260 - -----------------+------+--------------+-------------- - - -Chief Manufacturing Industries of the United States, Showing Sums Paid 301 -in Wages, Number of Employes, Capital Invested and Value of Product, -1880 to 1905. - -[From reports of the Bureau of the Census, Department of Commerce and -Labor.] - - ================================+======+==========+==============+ - | | | | - |Census|Number of | + - Industry. | yr. |establish-| Capital. | - | | ments. | | - | | | | - --------------------------------+------+----------+--------------+ - | | | Dollars. | - Agricultural implements | 1880 | 1,943 | 62,109,668| - | 1890 | 910 | 145,313,997| - | 1900 | 715 | 157,707,951| - | 1905 | 648 | 196,740,700| - | | | | - Boots and shoes | 1880 | 1,959 | 42,994,028| - | 1890 | 2,082 | 95,282,311| - | 1900 | 1,599 | 99,819,233| - | 1905 | 1,316 | 122,526,093| - | | | | - Bread and other bakery | 1880 | 6,396 | 19,155,286| - products | 1890 | 10,484 | 45,758,489| - | 1900 | 14,836 | 80,901,926| - | 1905 | 18,227 | 122,363,327| - | | | | - Carriages and wagons | 1880 | 3,841 | 37,973,493| - | 1890 | 4,572 | 93,455,257| - | 1900 | 6,204 | 109,875,885| - | 1905 | 4,956 | 126,320,604| - | | | | - Cars, shop construction and | 1890 | 716 | 76,192,477| - repairs by steam railroad | 1900 | 1,293 | 119,580,273| - companies | 1905 | 1,141 | 146,943,729| - | | | | - Cars, shop construction and | 1890 | 78 | 2,351,162| - repairs by street railway | 1900 | 108 | 10,781,939| - companies | 1905 | 86 | 12,905,853| - | | | | - Cars, steam and street railroad,| 1880 | 130 | 9,272,680| - not including operations | 1890 | 88 | 46,109,625| - of railway companies | 1900 | 85 | 95,939,249| - | 1905 | 87 | 101,154,750| - | | | | - Cheese, butter and condensed | 1880 | 3,932 | 9,604,803| - milk | 1890 | 4,552 | 16,016,573| - | 1900 | 9,242 | 36,303,164| - | 1905 | 8,926 | 47,255,556| - | | | | - Chemicals | 1880 | 595 | 28,983,458| - | 1890 | 563 | 55,032,452| - | 1900 | 433 | 89,069,450| - | 1905 | 448 | 119,890,193| - | | | | - Clothing, men’s | 1880 | 6,166 | 79,861,696| - | 1890 | 4,867 | 128,253,547| - | 1900 | 5,729 | 120,547,851| - | 1905 | 4,504 | 153,177,500| - | | | | - Clothing, women’s | 1880 | 562 | 8,207,273| - | 1890 | 1,224 | 21,259,528| - | 1900 | 2,701 | 48,431,544| - | 1905 | 3,351 | 73,947,823| - | | | | - Confectionery | 1880 | 1,450 | 8,486,874| - | 1890 | 2,921 | 23,326,799| - | 1900 | 962 | 26,319,195| - | 1905 | 1,348 | 43,125,408| - | | | | - Cooperage | 1880 | 3,898 | 12,178,726| - | 1890 | 2,652 | 17,806,554| - | 1900 | 1,694 | 21,777,636| - | 1905 | 1,517 | 29,532,614| - | | | | - Cordage and twine | 1880 | 165 | 7,140,475| - | 1890 | 150 | 23,351,883| - | 1900 | 105 | 29,275,470| - | 1905 | 102 | 37,110,521| - | | | | - Cotton goods | 1880 | 1,005 | 219,504,794| - | 1890 | 905 | 354,020,843| - | 1900 | 1,055 | 467,240,157| - | 1905 | 1,154 | 613,110,655| - | | | | - Electrical machinery, | 1880 | 76 | 1,509,758| - apparatus and supplies | 1890 | 189 | 18,997,337| - | 1900 | 581 | 83,659,924| - | 1905 | 784 | 174,066,026| - | | | | - Flour and gristmill products | 1880 | 24,338 | 177,361,878| - | 1890 | 18,470 | 208,473,500| - | 1900 | 9,476 | 189,281,330| - | 1905 | 10,051 | 265,117,434| - | | | | - Foundry and machine shop | 1880 | 4,984 | 155,021,734| - products | 1890 | 6,500 | 383,257,473| - | 1900 | 9,316 | 663,414,323| - | 1905 | 9,428 | 936,416,978| - | | | | - Furnishing goods, men’s | 1880 | 161 | 3,724,664| - | 1890 | 586 | 12,299,011| - | 1900 | 457 | 20,575,961| - | 1905 | 547 | 28,043,584| - Furniture | 1880 | 5,227 | 44,946,128| - | 1890 | 1,919 | 80,780,939| - | 1900 | 1,814 | 104,484,394| - | 1905 | 2,482 | 152,712,732| - | | | | - Glass | 1880 | 169 | 18,804,599| - | 1890 | 294 | 40,966,850| - | 1900 | 355 | 61,423,903| - | 1905 | 399 | 89,389,151| - | | | | - Hardware | 1880 | 492 | 15,363,551| - | 1890 | 350 | 26,271,840| - | 1900 | 381 | 39,311,745| - | 1905 | 445 | 52,884,078| - | | | | - Jewelry | 1880 | 739 | 11,431,164| - | 1890 | 783 | 22,246,508| - | 1900 | 851 | 27,871,924| - | 1905 | 1,023 | 39,678,956| - | | | | - Leather, tanned, curried, and | 1880 | 5,628 | 73,383,911| - finished | 1890 | 1,787 | 98,088,698| - | 1900 | 1,306 | 173,977,421| - | 1905 | 1,049 | 242,584,254| - | | | | - Liquors, malt | 1880 | 2,191 | 91,208,224| - | 1890 | 1,248 | 232,471,290| - | 1900 | 1,507 | 413,767,233| - | 1905 | 1,531 | 515,636,792| - | | | | - Lumber and timber products | 1880 | 25,758 | 181,465,392| - | 1890 | 22,617 | 557,881,054| - | 1900 | 23,053 | 400,857,337| - | 1905 | 19,127 | 517,224,128| - | | | | - Lumber, planing-mill products, | 1880 | 2,491 | 38,070,593| - including sash, doors, | 1890 | 3,670 | 120,271,440| - and blinds | 1900 | 4,198 | 118,948,556| - | 1905 | 5,009 | 177,145,734| - | | | | - Marble and stone work | 1880 | 2,846 | 16,498,221| - | 1890 | 1,321 | 24,041,961| - | 1900 | 1,655 | 39,559,146| - | 1905 | 1,642 | 66,526,724| - | | | | - Paper and wood pulp | 1880 | 742 | 48,139,652| - | 1890 | 649 | 89,829,548| - | 1900 | 763 | 167,507,713| - | 1905 | 761 | 277,444,471| - | | | | - Petroleum, refining | 1890 | 94 | 77,416,296| - | 1900 | 67 | 95,327,892| - | 1905 | 98 | 136,280,541| - | | | | - Silk and silk goods | 1880 | 382 | 19,125,300| - | 1890 | 472 | 51,007,537| - | 1900 | 483 | 81,082,201| - | 1905 | 624 | 109,556,621| - | | | | - Slaughtering and meat packing, | 1880 | 872 | 49,419,213| - wholesale | 1890 | 611 | 98,190,766| - | 1900 | 557 | 173,866,377| - | 1905 | 559 | 219,818,627| - | | | | - Slaughtering, wholesale, not | 1890 | 507 | 18,696,738| - including meat packing | 1900 | 325 | 14,933,804| - | 1905 | 370 | 17,896,063| - | | | | - Smelting and refining, copper | 1900 | 47 | 53,063,395| - | 1905 | 40 | 76,824,640| - | | | | - Smelting and refining, lead | 1900 | 39 | 72,148,933| - | 1905 | 32 | 63,822,810| - | | | | - Structural ironwork | 1880 | 220 | 1,400,197| - | 1890 | 724 | 21,968,172| - | 1900 | 697 | 43,442,877| - | 1905 | 775 | 76,598,507| - | | | | - Sugar and molasses, refining | 1880 | 49 | 27,432,500| - | 1890 | 393 | 24,013,008| - | 1900 | 657 | 184,033,304| - | 1905 | 344 | 165,468,320| - | | | | - Tinware, copper-smithing, | 1880 | 7,693 | 23,167,392| - and sheet iron working | 1890 | 7,002 | 38,434,900| - | 1900 | 1,846 | 35,724,739| - | 1905 | 2,366 | 124,500,133| - | | | | - Tobacco, chewing and smoking, | 1880 | 477 | 17,207,401| - and snuff | 1890 | 395 | 30,841,316| - | 1900 | 437 | 43,856,570| - | 1905 | 433 | 178,847,556| - | | | | - Tobacco, cigars and cigarettes | 1880 | 7,145 | 21,698,549| - | 1890 | 10,956 | 59,517,827| - | 1900 | 14,522 | 67,660,748| - | 1905 | 16,395 | 145,135,945| - | | | | - Woolen goods | 1880 | 1,990 | 96,095,564| - | 1890 | 1,811 | 130,989,940| - | 1900 | 1,035 | 124,386,262| - | 1905 | 792 | 140,302,488| - | | | | - Worsted goods | 1880 | 76 | 20,374,043| - | 1890 | 143 | 68,085,116| - | 1900 | 186 | 132,168,110| - | 1905 | 226 | 162,464,929| - --------------------------------+------+----------+--------------+ - ================================+======+=====================+============== - | | Wage-earners. | Value of - |Census|--------+------------+ products, - Industry. | yr. | Average| Total | including - | | number.| wages. | custom work - | | | |and repairing. - --------------------------------+------+--------+------------+-------------- - | | | Dollars. | Dollars. - Agricultural implements | 1880 | 39,580| 15,359,610| 68,640,486 - | 1890 | 38,827| 18,107,094| 81,271,651 - | 1900 | 46,582| 22,450,880| 101,207,428 - | 1905 | 47,394| 25,002,650| 112,007,344 - | | | | - Boots and shoes | 1880 | 111,152| 43,001,438| 166,050,354 - | 1890 | 133,690| 60,667,145| 220,649,358 - | 1900 | 141,830| 58,440,883| 258,969,580 - | 1905 | 149,924| 69,059,680| 320,107,458 - | | | | - Bread and other bakery | 1880 | 22,488| 9,411,328| 65,824,806 - products | 1890 | 38,841| 19,120,529| 128,421,535 - | 1900 | 60,192| 27,864,024| 175,368,682 - | 1905 | 81,284| 43,179,822| 269,609,061 - | | | | - Carriages and wagons | 1880 | 45,394| 18,988,615| 64,951,617 - | 1890 | 56,525| 28,972,401| 102,680,341 - | 1900 | 58,425| 27,578,046| 113,234,590 - | 1905 | 60,722| 30,878,229| 125,332,976 - | | | | - Cars, shop construction and | 1890 | 106,632| 60,213,433| 129,461,698 - repairs by steam railroad | 1900 | 173,652| 96,062,329| 218,238,277 - companies | 1905 | 236,900| 142,188,336| 309,863,499 - | | | | - Cars, shop construction and | 1890 | 2,009| 1,411,205| 2,966,347 - repairs by street railway | 1900 | 7,025| 4,404,593| 9,370,811 - companies | 1905 | 11,052| 7,012,798| 13,437,121 - | | | | - Cars, steam and street railroad,| 1880 | 14,232| 6,507,753| 27,997,591 - not including operations | 1890 | 33,139| 17,168,099| 73,385,852 - of railway companies | 1900 | 37,038| 18,938,170| 97,815,648 - | 1905 | 38,788| 23,087,400| 122,019,506 - | | | | - Cheese, butter and condensed | 1880 | 7,903| 1,548,495| 25,742,510 - milk | 1890 | 12,219| 4,248,854| 60,635,705 - | 1900 | 12,799| 6,145,561| 130,783,349 - | 1905 | 15,557| 8,412,937| 168,182,789 - | | | | - Chemicals | 1880 | 9,724| 4,222,663| 38,640,458 - | 1890 | 15,038| 7,308,411| 59,352,548 - | 1900 | 19,020| 9,393,236| 62,637,008 - | 1905 | 24,525| 13,361,972| 92,088,378 - | | | | - Clothing, men’s | 1880 | 160,813| 45,940,353| 209,548,460 - | 1890 | 144,926| 51,075,837| 251,019,609 - | 1900 | 120,927| 45,496,728| 276,717,357 - | 1905 | 137,190| 57,225,506| 355,796,571 - | | | | - Clothing, women’s | 1880 | 25,192| 6,661,005| 32,004,794 - | 1890 | 39,149| 15,428,272| 68,164,019 - | 1900 | 83,739| 32,586,101| 159,339,539 - | 1905 | 115,705| 51,180,193| 247,661,560 - | | | | - Confectionery | 1880 | 9,801| 3,242,852| 25,637,033 - | 1890 | 21,724| 7,783,007| 55,997,101 - | 1900 | 26,866| 8,020,453| 60,643,946 - | 1905 | 36,239| 11,699,257| 87,087,253 - | | | | - Cooperage | 1880 | 25,973| 8,992,603| 33,714,770 - | 1890 | 22,555| 10,056,249| 38,617,956 - | 1900 | 22,117| 8,786,428| 38,439,746 - | 1905 | 21,149| 9,485,455| 49,424,394 - | | | | - Cordage and twine | 1880 | 5,435| 1,558,676| 12,492,171 - | 1890 | 12,385| 3,976,232| 38,812,559 - | 1900 | 13,114| 4,113,112| 37,849,651 - | 1905 | 14,614| 5,338,178| 48,017,139 - | | | | - Cotton goods | 1880 | 185,472| 45,614,419| 210,950,383 - | 1890 | 218,876| 66,024,538| 267,981,724 - | 1900 | 302,861| 86,689,752| 339,200,820 - | 1905 | 315,874| 96,205,796| 450,467,704 - | | | | - Electrical machinery, | 1880 | 1,271| 683,164| 2,655,036 - apparatus and supplies | 1890 | 8,802| 4,517,050| 19,114,714 - | 1900 | 42,013| 20,579,194| 92,434,435 - | 1905 | 60,466| 31,841,521| 140,809,369 - | | | | - Flour and gristmill products | 1880 | 58,407| 17,422,316| 505,185,712 - | 1890 | 47,403| 18,138,402| 513,971,474 - | 1900 | 32,226| 16,285,163| 501,896,304 - | 1905 | 39,110| 19,822,196| 713,033,395 - | | | | - Foundry and machine shop | 1880 | 145,650| 66,093,920| 215,442,011 - products | 1890 | 231,331| 129,282,263| 413,197,118 - | 1900 | 350,103| 182,096,007| 644,456,216 - | 1905 | 402,914| 229,869,297| 799,862,588 - | | | | - Furnishing goods, men’s | 1880 | 11,174| 2,644,155| 11,506,357 - | 1890 | 20,773| 6,078,036| 29,870,946 - | 1900 | 30,322| 9,730,066| 44,346,482 - | 1905 | 27,185| 8,760,108| 49,031,582 - | | | | - Furniture | 1880 | 59,304| 23,695,080| 77,845,725 - | 1890 | 72,869| 35,068,979| 111,743,080 - | 1900 | 87,262| 35,632,523| 125,315,986 - | 1905 | 110,133| 49,883,235| 170,446,825 - | | | | - Glass | 1880 | 24,177| 9,144,100| 21,154,571 - | 1890 | 44,892| 20,885,961| 41,051,004 - | 1900 | 52,818| 27,084,710| 56,539,712 - | 1905 | 63,969| 37,288,148| 79,607,998 - | | | | - Hardware | 1880 | 16,801| 6,846,913| 22,653,693 - | 1890 | 18,495| 8,656,067| 26,726,463 - | 1900 | 26,463| 11,422,758| 35,846,656 - | 1905 | 31,713| 14,580,589| 45,770,171 - | | | | - Jewelry | 1880 | 12,697| 6,441,688| 22,201,621 - | 1890 | 13,880| 8,038,327| 34,761,458 - | 1900 | 20,468| 10,643,887| 46,128,659 - | 1905 | 22,080| 12,592,846| 53,225,681 - | | | | - Leather, tanned, curried, and | 1880 | 40,282| 16,503,828| 200,264,944 - finished | 1890 | 42,392| 21,249,989| 172,136,092 - | 1900 | 52,109| 22,591,091| 204,038,127 - | 1905 | 57,239| 27,049,152| 252,620,986 - | | | | - Liquors, malt | 1880 | 26,220| 12,198,053| 101,058,385 - | 1890 | 30,257| 20,713,383| 182,731,622 - | 1900 | 39,459| 25,776,468| 236,914,914 - | 1905 | 48,139| 34,542,897| 298,358,732 - | | | | - Lumber and timber products | 1880 | 148,290| 31,893,098| 233,608,886 - | 1890 | 311,964| 87,934,284| 437,957,382 - | 1900 | 413,335| 148,007,845| 555,197,271 - | 1905 | 404,626| 183,021,519| 580,022,690 - | | | | - Lumber, planing-mill products, | 1880 | 37,187| 14,431,654| 73,424,681 - including sash, doors, | 1890 | 79,923| 42,221,856| 183,681,552 - and blinds | 1900 | 73,510| 32,621,704| 167,786,122 - | 1905 | 97,674| 50,713,607| 247,441,956 - | | | | - Marble and stone work | 1880 | 21,471| 10,238,885| 31,415,150 - | 1890 | 21,950| 15,314,598| 41,924,264 - | 1900 | 30,641| 16,328,174| 42,230,457 - | 1905 | 40,905| 25,032,725| 63,059,842 - | | | | - Paper and wood pulp | 1880 | 25,631| 8,970,133| 57,366,860 - | 1890 | 31,050| 13,204,828| 78,937,184 - | 1900 | 49,646| 20,746,426| 127,326,162 - | 1905 | 65,964| 32,019,212| 188,715,189 - | | | | - Petroleum, refining | 1890 | 11,403| 5,872,467| 85,001,198 - | 1900 | 12,199| 6,717,087| 123,929,384 - | 1905 | 16,770| 9,989,367| 175,005,320 - | | | | - Silk and silk goods | 1880 | 31,337| 9,146,705| 41,033,045 - | 1890 | 49,382| 17,762,441| 87,298,454 - | 1900 | 65,416| 20,982,194| 107,256,258 - | 1905 | 79,601| 26,767,943| 133,288,072 - | | | | - Slaughtering and meat packing, | 1880 | 27,297| 10,508,530| 303,562,413 - wholesale | 1890 | 37,502| 20,304,029| 433,252,315 - | 1900 | 64,681| 31,033,850| 697,056,065 - | 1905 | 69,593| 37,090,399| 801,757,137 - | | | | - Slaughtering, wholesale, not | 1890 | 6,473| 4,000,947| 128,359,353 - including meat packing | 1900 | 3,705| 2,358,403| 86,723,126 - | 1905 | 4,541| 3,236,573| 112,157,487 - | | | | - Smelting and refining, copper | 1900 | 11,324| 8,529,021| 165,131,670 - | 1905 | 12,752| 10,827,043| 240,780,216 - | | | | - Smelting and refining, lead | 1900 | 8,319| 5,088,684| 175,466,304 - | 1905 | 7,573| 5,374,691| 185,826,839 - | | | | - Structural ironwork | 1880 | 1,934| 844,614| 3,410,086 - | 1890 | 17,158| 10,235,701| 37,745,294 - | 1900 | 24,903| 13,588,779| 66,927,305 - | 1905 | 34,276| 19,760,210| 90,944,697 - | | | | - Sugar and molasses, refining | 1880 | 5,857| 2,875,032| 155,484,915 - | 1890 | 7,043| 2,385,654| 123,118,259 - | 1900 | 14,129| 6,917,829| 239,711,011 - | 1905 | 13,549| 7,575,650| 277,285,449 - | | | | - Tinware, copper-smithing, | 1880 | 27,116| 11,243,276| 50,183,811 - and sheet iron working | 1890 | 31,377| 15,610,265| 66,653,746 - | 1900 | 28,315| 13,193,307| 63,812,787 - | 1905 | 39,475| 20,608,179| 97,974,838 - | | | | - Tobacco, chewing and smoking, | 1880 | 32,756| 6,419,024| 52,793,056 - and snuff | 1890 | 29,790| 6,947,158| 65,843,587 - | 1900 | 29,161| 7,109,821| 103,754,362 - | 1905 | 23,990| 6,775,325| 116,767,630 - | | | | - Tobacco, cigars and cigarettes | 1880 | 63,297| 18,464,562| 63,979,575 - | 1890 | 87,000| 36,475,060| 129,693,275 - | 1900 | 103,365| 40,865,510| 159,958,811 - | 1905 | 135,418| 55,864,978| 214,350,051 - | | | | - Woolen goods | 1880 | 86,504| 25,836,392| 160,606,721 - | 1890 | 76,915| 26,139,194| 133,577,977 - | 1900 | 68,893| 24,757,006| 118,430,158 - | 1905 | 72,747| 28,827,556| 142,196,658 - | | | | - Worsted goods | 1880 | 18,803| 5,683,027| 33,549,942 - | 1890 | 42,978| 14,944,966| 79,194,652 - | 1900 | 57,008| 20,092,738| 120,314,344 - | 1905 | 69,251| 26,269,787| 165,745,052 - --------------------------------+------+--------+------------+------------ - - -The Textile Industries of the United States at Decennial Periods, 303 -1850 to 1900. - -[Compiled from Census Reports.] - - =====================+=====+==========+=============+=========+ - | | Number of| |Number of| - |Year.|establish-| Capital. | wage- | - | | ments. | | earners.| - ---------------------+-----+----------+-------------+---------+ - Wool manufacture[Z] | 1850| 1,760 | $ 32,516,366| 47,763 | - | 1860| 1,673 | 42,849,932| 59,522 | - | 1870| 3,456 | 132,382,319| 119,859 | - | 1880| 2,689 | 159,091,869| 161,557 | - | 1890| 2,489 | 296,494,481| 213,859 | - | 1900| 2,335 | 392,040,353| 242,495 | - | 1905| 2,292 | 477,525,222| 283,691 | - | | | | | - Cotton manufacture[A]| 1850| 1,094 | 74,500,931| 92,286 | - | 1860| 1,091 | 98,585,269| 122,028 | - | 1870| 956 | 140,706,291| 135,369 | - | 1880| 756 | 208,280,346| 174,659 | - | 1890| 905 | 354,020,842| 218,876 | - | 1900| 1,055 | 467,240,157| 802,861 | - | 1905| 1,154 | 613,110,655| 315,874 | - | | | | | - Silk manufacture | 1850| 67 | 678,300| 1,743 | - | 1860| 139 | 2,926,980| 5,435 | - | 1870| 86 | 6,231,130| 6,649 | - | 1880| 382 | 19,125,300| 31,337 | - | 1890| 472 | 51,007,537| 49,382 | - | 1900| 483 | 81,082,201| 65,416 | - | 1905| 624 | 109,556,621| 79,601 | - | | | | | - Dyeing and finishing | | | | | - textiles | 1850| 104 | 4,818,350| 5,105 | - | 1860| 124 | 5,718,671| 7,097 | - | 1870| 292 | 18,374,503| 13,066 | - | 1880| 191 | 26,223,981| 16,698 | - | 1890| 248 | 38,450,800| 19,601 | - | 1900| 298 | 60,643,104| 29,776 | - | 1905| 360 | 88,708,576| 35,563 | - | | | | - Flax, hemp and jute | 1890| 162 | 27,731,649| 15,519 | - | 1900| 141 | 41,991,762| 20,903 | - | 1905| 133 | 54,423,531| 24,508 | - | | | | | - Combined textiles | 1850| 3,025 | 112,513,947| 146,877 | - | 1860| 3,027 | 150,080,852| 194,082 | - | 1870| 4,790 | 297,694,243| 274,943 | - | 1880| 4,018 | 412,721,496| 384,251 | - | 1890| 4,276 | 767,705,310| 517,237 | - | 1900| 4,312 |1,042,997,577| 661,451 | - | 1905| 4,563 |1,343,324,605| 739,239 | - ---------------------+-----+----------+-------------+---------+ - =====================+=====+===========+===========+============= - | | | Cost of | Value of - |Year.| Wages. | materials.| products. - | | | | - ---------------------+-----+-----------+-----------+------------- - Wool manufacture[Z] | 1850| -- |$29,246,696| $ 49,636,881 - | 1860|$13,361,602| 46,649,365| 80,734,606 - | 1870| 40,357,235|134,154,615| 217,668,826 - | 1880| 47,389,087|164,371,551| 267,252,913 - | 1890| 70,917,894|203,095,572| 337,768,524 - | 1900| 82,292,444|232,230,986| 392,473,050 - | 1905|102,333,548|319,154,878| 517,492,142 - | | | | - Cotton manufacture[A]| 1850| -- | 34,835,056| 61,869,184 - | 1860| 23,940,108| 57,285,534| 115,681,774 - | 1870| 39,044,132|111,736,936| 177,489,789 - | 1880| 42,040,510|102,206,347| 192,090,110 - | 1890| 66,024,538|154,912,979| 267,981,724 - | 1900| 86,689,752|176,551,527| 339,200,320 - | 1905| 96,205,796|286,255,303| 450,467,704 - | | | - Silk manufacture | 1850| -- | 1,093,866| 1,809,476 - | 1860| 1,050,224| 3,901,777| 6,607,771 - | 1870| 1,942,286| 7,817,559| 12,210,662 - | 1880| 9,146,705| 22,467,701| 41,033,045 - | 1890| 17,762,441| 51,004,425| 87,298,454 - | 1900| 20,982,194| 62,406,665| 107,256,258 - | 1905| 26,767,943| 75,861,188| 188,288,072 - | | | | - Dyeing and finishing | | | | - textiles | 1850| -- | 11,540,347| 15,454,430 - | 1860| 2,001,528| 5,005,435| 11,716,463 - | 1870| 5,221,538| 99,539,992| 113,017,537 - | 1880| 6,474,364| 13,664,295| 32,297,420 - | 1890| 8,911,720| 12,385,220| 28,900,460 - | 1900| 12,726,316| 17,958,137| 44,963,331 - | 1905| 15,469,205| 19,621,253| 50,849,545 - | | | - Flax, hemp and jute | 1890| 4,872,389| 26,148,344| 37,313,021 - | 1900| 6,331,741| 32,197,885| 47,601,607 - | 1905| 8,580,785| 44,890,546| 62,939,329 - | | | | - Combined textiles | 1850| -- | 76,715,959| 128,769,971 - | 1860| 40,353,462|112,842,111| 214,740,614 - | 1870| 86,565,191|353,249,102| 520,386,764 - | 1880|105,050,666|302,709,894| 532,673,488 - | 1890|168,488,982|447,546,540| 759,262,283 - | 1900|209,022,447|521,345,200| 931,494,566 - | 1905|249,357,277|745,783,168|1,215,036,792 - ---------------------+-----+-----------+-----------+------------- - - [Z] Includes hosiery and knit goods. - - [A] Includes cotton small wares. - - - -Cotton Manufactures in the United States, 1870 to 1905. 304 - -[From official reports of the United States Census Office.] - - ========================+============+============+==============+ - | 1870. | 1880. | 1890. | - ------------------------+------------+------------+--------------+ - Number of establishments| 956| 756| 905| - Capital |$140,706,291|$208,280,346| $354,020,843| - Wage-earners, average | | | | - number | 135,369| 174,659| 218,876| - Total wages | $39,044,132| $42,040,510| $66,024,538| - Cost of materials used |$111,736,936|$102,206,347| $154,912,979| - Value of products |$177,489,739|$192,090,110| $267,981,724| - Active spindles, number | 7,132,415| 10,653,435| 14,188,103| - Looms, number | 157,310| 225,759| 324,866| - Cotton consumed, bales | -- | 1,570,344| 2,261,600| - Cotton consumed, pounds | 398,308,257| 759,343,981| 1,117,945,776| - ------------------------+------------+------------+--------------+ - ========================+==============+============== - | 1900. | 1905. - ------------------------+--------------+-------------- - Number of establishments| 973| 1,077 - Capital | $460,842,772| $605,100,164 - Wage-earners, average | | - number | 297,929| 310,458 - Total wages | $85,126,310| $94,377,696 - Cost of materials used | $178,441,390| $282,047,648 - Value of products | $332,806,156| $442,451,218 - Active spindles, number | 19,008,352| 23,155,613 - Looms, number | 450,682| 640,910 - Cotton consumed, bales | 3,639,495| 3,743,089 - Cotton consumed, pounds | 1,814,002,512| 1,873,074,716 - ------------------------+--------------+-------------- - - -Silk Manufactures in the United States, 1870 to 1905. - -[From official reports of the United States Census Office.] - - ========================+============+============+==============+ - | 1870. | 1880. | 1890. | - ------------------------+------------+------------+--------------+ - | | | | - Number of establishments| 86| 382| 472 | - Capital | $6,231,180| $19,125,300| $51,007,537| - Wage-earners, average - number | 6,649| 31,337| 49,382 | - Total wages | $1,942,286| $9,146,705| $17,762,441 | - Cost of materials used | $7,817,559| $22,467,701| $51,004,425 | - Value of products | $12,210,662| $41,033,045| $87,298,454 | - Raw silk used, pounds | 684,488| 2,690,482| 6,376,881 | - ------------------------+------------+------------+--------------+ - ========================+=============+============== - | 1900. | 1905. - ------------------------+-------------+-------------- - | | - Number of establishments| 483| 624 - Capital | $81,082,201| $109,556,621 - Wage-earners, average - number | 65,416| 79,601 - Total wages | $20,982,194| $26,767,943 - Cost of materials used | $62,406,665| $75,861,188 - Value of products | $107,256,258| $133,288,072 - Raw silk used, pounds | 9,760,770| 11,572,783 - ------------------------+-------------+-------------- - - -Cotton Production and Manufacturing in the United States, also Imports -and Exports of Cotton Manufactures. - -[From the Statistical Abstract of the United States.] - -======+==========+======================+===========+===========+=========== - | | Taken for home | | | - | | consumption. | | | - | Total +-------+-------+------+ Raw | Exports | Imports - |commercial| By | By | | cotton | of manu- | of manu- - | crop. |North- |South- |Total.| imported. | factures | factures - | | ern | ern | | | of cotton.| of cotton. - | |mills. |mills. | | | | - | | | | | | | -------+----------+-------+-------+------+-----------+-----------+----------- - | In thousands of bales. | Pounds. | Dollars. | Dollars. - +----------+-------+-------+------+-----------+-----------+----------- - 1884 | 5,713 | 1,537 | 340 | 1,877| 7,019,492| 11,885,211| 29,074,626 - 1885 | 5,706 | 1,437 | 316 | 1,753| 5,115,680| 11,836,591| 27,197,241 - 1886 | 6,575 | 1,781 | 381 | 2,162| 5,072,334| 13,959,934| 29,709,266 - 1887 | 6,499 | 1,687 | 401 | 2,088| 3,924,531| 14,929,342| 28,940,353 - 1888 | 7,047 | 1,805 | 456 | 2,261| 5,497,592| 13,013,189| 28,917,799 - 1889 | 6,939 | 1,790 | 480 | 2,270| 7,973,039| 10,212,644| 26,805,942 - 1890 | 7,297 | 1,780 | 545 | 2,325| 8,606,049| 9,999,277| 29,918,055 - 1891 | 8,674 | 2,027 | 613 | 2,640| 20,908,817| 13,604,857| 29,712,624 - 1892 | 9,018 | 2,172 | 684 | 2,856| 28,663,769| 13,226,277| 28,323,841 - 1893 | 6,664 | 1,652 | 723 | 2,375| 43,367,952| 11,809,355| 33,560,293 - 1894 | 7,532 | 1,580 | 711 | 2,291| 27,705,949| 14,340,886| 22,346,547 - 1895 | 9,837 | 2,019 | 852 | 2,871| 49,332,022| 13,789,810| 33,196,625 - 1896 | 7,147 | 1,605 | 900 | 2,605| 55,350,520| 16,837,396| 32,437,504 - 1897 | 8,706 | 1,793 | 999 | 2,792| 51,898,926| 21,037,678| 34,429,363 - 1898 | 11,216 | 2,211 | 1,254 | 3,465| 52,660,363| 17,024,092| 27,267,300 - 1899 | 11,256 | 2,217 | 1,415 | 3,632| 50,158,158| 23,566,914| 32,054,434 - 1900 | 9,422 | 2,047 | 1,597 | 3,644| 67,398,521| 24,003,087| 41,296,239 - 1901 | 10,839 | 1,964 | 1,583 | 3,647| 46,631,283| 20,272,418| 40,246,935 - 1902 | 10,768 | 2,066 | 2,017 | 4,083| 98,715,680| 32,108,362| 44,460,126 - 1903 | 10,674 | 1,966 | 1,958 | 3,924| 74,874,426| 32,216,304| 52,462,755 - 1904 | 10,002 | 2,046 | 1,889 | 3,935| 48,840,590| 22,403,718| 49,524,246 - 1905 | 13,654 | 2,292 | 2,270 | 4,562| 60,508,548| 49,668,080| 48,919,986 - 1906 | 11,234 | 2,335 | 2,292 | 4,627| 70,963,633| 52,944,038| 63,043,322 - 1907 | 13,540 | 2,510 | 2,495 | 5,005|104,791,784| 32,305,412| 73,704,636 -------+----------+-------+-------+------+-----------+-----------+----------- - - -Iron and Steel Manufacturing in the U. S.: Comparative Summary, 1870 305 -to 1905, with per cent of increase for each decade.[B] - -[From the United States Census.] - - =============================+========================================== - | Date of census. | - +------------+------------+---------------+ - | 1870.[C] | 1880.[C] | 1890. | - | | | | - -----------------------------+------------+------------+---------------+ - Number of establishments | 808| 792| 719| - Capital |$121,722,704|$209,904,965|[D]$414,044,844| - Salaried officials, clerks, - etc., number | [E] | [E] | 4,325| - Salaries | [E] | [E] | $6,462,236| - Wage-earners, average number | 77,555| 140,798| 171,181| - Total wages | $40,514,981| $55,451,510| $89,273,956| - Men, 16 years and over | 75,037| 133,023| 168,943| - Wages | [E] | [E] | $88,840,642| - Women, 16 years and over | 82| 45| 58| - Wages | [E] | [E] | $17,106| - Children, under 16 years | 2,436| 7,730| 2,180| - Wages | [E] | [E] | $416,208| - Miscellaneous expenses | [F] | [F] | $18,214,948| - Cost of materials used |$135,526,132|$191,271,150| $327,272,845| - Value of products |$207,208,696|$296,557,685| $478,687,519| - Tons of products - (2,240 pounds each) | 3,263,585| 6,486,733| 16,264,478| - -----------------------------+------------+------------+---------------+ - =============================+=========================+ - | Date of census. | - +------------+------------+ - | 1900. | 1905. | - | | | - -----------------------------+------------+------------+ - Number of establishments | 669| 606| - Capital |$590,530,484|$948,689,840| - Salaried officials, clerks, - etc., number | 9,217| 16,566| - Salaries | $11,741,788| $20,758,412| - Wage-earners, average number | 222,607| 242,740| - Total wages |$120,836,338|$141,439,906| - Men, 16 years and over | 219,635| 239,383| - Wages |$120,157,007 $140,545,610| - Women, 16 years and over | 1,071| 1,455| - Wages | $266,888| $441,967| - Children, under 16 years | 1,901| 1,902| - Wages | $412,443| $452,329| - Miscellaneous expenses | $32,274,100| $47,164,970| - Cost of materials used |$522,431,701|$620,171,881| - Value of products |$804,034,918|$905,854,152| - Tons of products - (2,240 pounds each) | 29,507,860| 34,844,933| - -----------------------------+------------+------------+ - =============================+=================================== - | Per cent of increase. - +--------+--------+--------+-------- - | 1870 to| 1880 to| 1890 to| 1900 to - | 1880. | 1890. | 1900. | 1905. - -----------------------------+--------+--------+--------+-------- - Number of establishments | [D]2.0 | [D]9.2 | [D]7.0 | 9.4 - Capital | 72.4 | 97.3 | 42.6 | 60.7 - Salaried officials, clerks, - etc., number | -- | -- | 113.1 | 79.7 - Salaries | -- | -- | 81.7 | 76.8 - Wage-earners, average number | 81.5 | 21.6 | 30.0 | 9.0 - Total wages | 36.9 | 61.0 | 35.4 | 17.1 - Men, 16 years and over | 77.3 | 27.0 | 30.0 | 9.0 - Wages | -- | -- | 35.3 | 17.0 - Women, 16 years and over |[D]45.1 | 28.9 |1,746.6 | 35.9 - Wages | -- | -- |1,460.2 | 65.6 - Children, under 16 years | 217.3 |[D]71.8 |[D]12.8 | 0.1 - Wages | -- | -- |[D] O.9 | 9.7 - Miscellaneous expenses | -- | -- | 77.2 | 46.1 - Cost of materials used | 41.1 | 71.1 | 59.6 | 18.7 - Value of products | 43.1 | 61.4 | 68.0 | 12.7 - Tons of products - (2,240 pounds each) | 98.8 | 150.7 | 81.4 | 18.1 - -----------------------------+--------+--------+--------+-------- - - [B] This summary includes only active establishments for 1880, 1890, - and 1900; such establishments were not reported separately in - 1870. The 669 establishments in 1900 and the 606 establishments - in 1905 include in each case 1 penal institution, the figures - for which are not included in Parts I and II of the Report on - Manufactures. - - [C] For explanation of the apparent discrepancies in the data for - 1870 and 1880, see remarks, page 2, Part I, Manufacturing - Industries, 1890, in regard to the depreciated currency in 1870; - and in regard to the inclusion of capital, employes, and wages - relating to mining and other operations in the figures for 1880, - see page 745, Statistics of Manufactures, 1880. - - [D] Decrease. - - [E] Not reported separately. - - [F] Not reported. - - -Production of Pig Iron and of Crude Steel in the United States, 1880 306 -to 1907, and relation of same to Imports and Exports of Iron and Steel -Manufactures; also Prices of Representative Iron and Steel Products -during the period named. - -[From official reports of Bureau of Statistics.] - - - =========+============+==============+==========+===========+ - | | | Per cent | | - | | | of | | - | Pig iron | Crude steel | domestic | Price | - | produced | produced |iron used |per ton of | - Year. | in United | in United | in home | pig iron, | - | States. | States. |industries| No. 1 | - | | | (fiscal |foundry.[G]| - | | | year). | | - ---------+------------+--------------+----------+-----------+ - | Tons. | Tons. | | | - 1880 | 3,835,191 | 1,247,335 | 78.44 | $28.48 | - 1881 | 4,144,254 | 1,588,314 | 90.23 | 25.17 | - 1882 | 4,623,323 | 1,736,692 | 89.36 | 25.77 | - 1883 | 4,595,510 | 1,673,535 | 91.44 | 22.42 | - 1884 | 4,097,868 | 1,550,879 | 94.20 | 19.81 | - 1885 | 4,044,526 | 1,711,920 | 96.43 | 17.99 | - 1886 | 5,683,329 | 2,562,503 | 93.92 | 18.71 | - 1887 | 6,417,148 | 3,339,071 | 93.13 | 20.93 | - 1888 | 6,489,738 | 2,899,440 | 95.17 | 18.88 | - 1889 | 7,603,642 | 3,385,732 | 97.35 | 17.76 | - 1890 | 9,202,703 | 4,277,071 | 98.10 | 18.41 | - 1891 | 8,279,870 | 3,904,240 | 99.12 | 17.52 | - 1892 | 9,157,000 | 4,927,581 | 99.01 | 15.75 | - 1893[H] | 7,124,502 | 4,019,995 | 99.39 | 14.52 | - 1894[H] | 6,657,388 | 4,412,032 | 99.64 | 12.66 | - 1895[H] | 9,446,308 | 6,114,834 | 99.79 | 13.10 | - 1896[H] | 8,623,127 | 5,281,689 | 99.07 | 12.95 | - 1897 | 9,652,680 | 7,156,957 | 99.77 | 12.10 | - 1898 | 11,773,934 | 8,932,857 | 99.79 | 11.66 | - 1899 | 13,620,703 | 10,639,857 | 99.80 | 19.36 | - 1900 | 13,789,242 | 10,188,329 | 98.55 | 19.98 | - 1901 | 15,878,354 | 13,473,595 | 99.71 | 15.87 | - 1902 | 17,821,307 | 14,947,250 | 99.01 | 22.19 | - 1903 | 18,009,252 | 14,534,978 | 94.92 | 19.92 | - 1904 | 16,497,033 | 13,859,887 | 98.95 | 15.57 | - 1905 | 22,992,380 | 20,023,947 | 99.27 | 17.88 | - 1906 | 25,307,191 | 23,398,136 | 98.94 | 20.98 | - 1907 | 25,781,361 |[I]23,360,000 | 97.83 | 23.89 | - ---------+------------+--------------+----------+-----------+ - =========+========+========+===========+============ - | | | | - | | Wire | Imports of| Exports of - |Price of| nails, | manu- | domestic - | steel | price | factures | manu- - Year. | rails | per | of iron | factures - |per ton.| keg of | and steel.| of iron - | |100 lbs.| | and steel. - | | | | - ---------+--------+--------+-----------+------------ - | | | | - 1880 | $67.52 | -- |$71,266,699| $14,716,524 - 1881 | 61.08 | -- | 60,604,477| 16,604,767 - 1882 | 48.50 | -- | 67,976,897| 20,748,206 - 1883 | 37.75 | -- | 58,495,246| 22,826,528 - 1884 | 30.75 | -- | 40,147,053| 21,909,881 - 1885 | 28.52 | -- | 33,610,093| 16,592,155 - 1886 | 34.52 | $3.51 | 37,534,078| 15,745,569 - 1887 | 37.08 | 3.15 | 49,203,164| 15,958,502 - 1888 | 29.83 | 2.55 | 48,992,757| 17,763,034 - 1889 | 29.25 | 2.49 | 42,377,793| 21,156,077 - 1890 | 31.78 | 2.51 | 41,679,591| 25,542,208 - 1891 | 29.92 | 2.04 | 53,544,372| 28,909,614 - 1892 | 30.00 | 1.70 | 28,928,103| 28,800,930 - 1893[H] | 28.12 | 1.49 | 34,937,974| 30,106,482 - 1894[H] | 24.00 | 1.11 | 20,925,769| 29,220,264 - 1895[H] | 24.33 | 1.69 | 23,048,515| 32,000,989 - 1896[H] | 28.00 | 2.54 | 25,338,103| 41,160,877 - 1897 | 18.75 | 1.46 | 16,094,557| 57,497,872 - 1898 | 17.62 | 1.45 | 12,626,431| 70,406,885 - 1899 | 28.12 | 2.60 | 12,100,440| 93,716,031 - 1900 | 32.29 | 2.76 | 20,478,728| 121,913,548 - 1901 | 27.33 | 2.41 | 17,874,789| 117,319,320 - 1902 | 28.00 | 2.15 | 27,180,247| 98,552,562 - 1903 | 28.00 | 2.13 | 51,617,312| 96,642,467 - 1904 | 28.00 | 1.96 | 27,028,312| 111,948,586 - 1905 | 28.00 | 1.93 | 23,510,164| 134,728,363 - 1906 | 28.00 | 1.98 | 29,053,987| 160,984,985 - 1907 | 28.00 | 2.18 | 40,587,865| 181,530,871 - ---------+--------+--------+-----------+------------ - - [G] Not made in commercial quantities in the United States before - 1887. - - [H] Democratic and low-tariff years. - - [I] Preliminary figures. - - -Annual Production of Bessemer Steel Rails in the United States from 307 -1867 to 1907, and their Average Annual Price at the Works in -Pennsylvania. - - ======+===========+=========++======+===========+========= - Years.|Gross tons.| Price. ||Years.|Gross tons.| Price. - ------+-----------+---------++------+-----------+--------- - 1867 | 2,277 | $166.00 || 1888 | 1,386,277 | $29.83 - 1868 | 6,451 | 158.46 || 1889 | 1,510,057 | 29.25 - 1869 | 8,616 | 132.19 || 1890 | 1,867,837 | 31.78 - 1870 | 30,357 | 106.79 || 1891 | 1,293,053 | 29.92 - 1871 | 34,152 | 102.52 || 1892 | 1,537,588 | 30.00 - 1872 | 83,991 | 111.94 || 1893 | 1,129,400 | 28.12 - 1873 | 115,192 | 120.58 || 1894 | 1,016,013 | 24.00 - 1874 | 129,414 | 94.28 || 1895 | 1,299,628 | 24.33 - 1875 | 259,699 | 68.75 || 1896 | 1,116,958 | 28.00 - 1876 | 368,269 | 59.25 || 1897 | 1,644,520 | 18.75 - 1877 | 385,865 | 45.58 || 1898 | 1,976,702 | 17.62 - 1878 | 491,427 | 42.21 || 1899 | 2,270,585 | 28.12 - 1879 | 610,682 | 48.21 || 1900 | 2,383,654 | 32.29 - 1880 | 852,196 | 67.52 || 1901 | 2,870,816 | 27.33 - 1881 | 1,187,770 | 61.08 || 1902 | 2,985,892 | 28.00 - 1882 | 1,284,067 | 48.50 || 1903 | 2,946,756 | 28.00 - 1883 | 1,148,709 | 87.75 || 1904 | 2,137,957 | 28.00 - 1884 | 996,983 | 30.75 || 1905 | 3,192,347 | 28.00 - 1885 | 959,471 | 28.52 || 1906 | 3,791,459 | 28.00 - 1886 | 1,574,703 | 34.52 || 1907 | 3,380,025 | 28.00 - 1887 | 2,101,904 | 37.08 || | | - ------+-----------+---------++------+-----------+-------- - - -Production of Tin Plates in and Importation of Tin Plates into the -United States, 1891 to 1908, in long tons. - - =========+===========+============++========+===========+============ - | |Importation,|| | |Importation, - Calendar |Production,| Long tons. ||Calendar|Production,| Long tons. - Year. | Long tons.| || Year. | Long tons.| - ---------+-----------+------------++--------+-----------+------------ - 1891 | 552 | 327,882 || 1900 | 302,665 | 60,386 - 1892 | 18,803 | 268,472 || 1901 | 399,291 | 77,395 - 1893 | 55,182 | 253,155 || 1902 | 366,000 | 60,115 - 1894 | 74,260 | 215,068 || 1903 | 480,000 | 47,360 - 1895 | 113,666 | 219,545 || 1904 | 458,000 | 70,652 - 1896 | 160,862 | 119,171 || 1905 | 493,500 | 65,740 - 1897 | 256,598 | 83,851 || 1906 | 577,562 | 56,983 - 1898 | 326,915 | 67,222 || 1907 | 514,777 | 57,773 - 1899 | 397,767 | 58,915 || 1908 | -- | 58,490 - ---------+-----------+------------++--------+-----------+------------ - - -Commerce of the United States by Great Groups and Share which 308 -Manufactures and Raw Material Formed of the Total, 1820 to 1909. - -Imports. - - ======================================================= - | Foodstuffs in | Foodstuffs partly | - Year ending | crude condition | or wholly | - | and food animals. | manufactured. | - June 30-- +-----------+--------+-----------+--------+ - | | Percent| | Percent| - | Dollars. |of Total| Dollars. |of Total| - ------------+-----------+--------+-----------+--------+ - 1820 | 6,081,641| 11.15 | 10,820,814| 19.85 | - 1830 | 7,382,274| 11.77 | 9,653,971| 15.39 | - 1840 | 15,273,321| 15.54 | 15,188,845| 15.46 | - 1850 | 18,011,659| 10.38 | 21,465,776| 12.37 | - 1860 | 35,743,826| 10.11 | 53,771,067| 15.21 | - 1870 | 53,981,838| 12.38 | 96,253,561| 22.08 | - 1875 | 90,018,885| 16.89 |113,145,852| 21.23 | - 1880 |100,297,040| 15.01 |118,125,216| 17.69 | - 1881 |102,486,852| 15.95 |123,380,388| 19.20 | - 1882 |104,947,672| 14.49 |139,438,506| 19.24 | - 1883 | 93,091,358| 12.87 |142,127,926| 19.65 | - 1884 |103,010,830| 15.43 |130,778,286| 19.59 | - 1885 | 93,345,583| 16.16 |102,937,933| 17.82 | - 1886 | 91,588,644| 14.41 |112,771,436| 17.75 | - 1887 |106,362,234| 15.36 |111,714,382| 16.14 | - 1888 |116,087,107| 16.03 |111,048,075| 15.34 | - 1889 |123,130,984| 16.53 |122,254,266| 16.41 | - 1890 |128,480,142| 16.28 |133,332,031| 16.89 | - 1891 |150,639,399| 17.83 |147,721,884| 17.48 | - 1892 |175,558,861| 21.22 |139,794,773| 16.89 | - 1893 |131,663,968| 15.19 |153,739,181| 17.75 | - 1894 |133,309,989| 20.35 |155,348,824| 23.72 | - 1895 |141,377,238| 19.31 |107,026,180| 14.63 | - 1896 |130,002,310| 16.67 |118,805,703| 15.24 | - 1897 |128,379,785| 16.79 |129,244,951| 16.90 | - 1898 |103,984,608| 16.88 | 86,091,010| 13.97 | - 1899 | 98,933,256| 14.19 |123,448,135| 17.71 | - 1900 | 97,916,293| 11.52 |133,027,374| 15.65 | - 1901 |110,385,208| 13.43 |125,540,654| 15.25 | - 1902 |120,280,302| 13.31 | 95,350,256| 10.56 | - 1903 |119,202,674| 11.62 |116,620,623| 11.37 | - 1904 |132,223,895| 13.34 |118,222,862| 11.93 | - 1905 |146,130,903| 13.08 |145,355,839| 13.01 | - 1906 |134,315,448| 10.95 |140,358,114| 11.44 | - 1907 |149,747,693| 10.44 |158,656,263| 11.06 | - 1908 |145,577,427| 12.19 |147,008,870| 12.31 | - 1909 |163,921,598| 12.49 |165,028,764| 12.58 | - ------------+-----------+--------+-----------+--------| - ======================================================= - | Crude materials | Manufactures for | - Year ending | for use in | further use in | - | manufacturing. | manufacturing. | - June 30-- +-----------+--------+-----------+--------+ - | | Percent| | Percent| - | Dollars. |of Total| Dollars. |of Total| - ------------+-----------+--------+-----------+--------+ - 1820 | 1,983,706| 3.64 | 4,079,064| 7.48 | - 1830 | 4,214,825| 6.72 | 5,152,486| 8.22 | - 1840 | 11,510,245| 11.71 | 11,356,196| 11.56 | - 1850 | 11,711,266| 6.75 | 26,163,152| 15.08 | - 1860 | 37,073,022| 10.49 | 23,613,395| 6.67 | - 1870 | 53,118,022| 12.18 | 54,545,306| 12.51 | - 1875 | 78,891,769| 14.80 | 63,411,606| 11.89 | - 1880 |131,861,617| 19.74 |110,779,516| 16.59 | - 1881 |114,244,631| 17.77 | 87,790,890| 13.66 | - 1882 |131,356,113| 18.13 | 98,623,766| 13.61 | - 1883 |133,612,450| 18.48 | 98,755,423| 13.66 | - 1884 |119,150,641| 17.84 | 94,698,249| 14.18 | - 1885 |106,774,553| 18.49 | 78,254,677| 13.55 | - 1886 |128,434,759| 20.22 | 91,539,244| 14.40 | - 1887 |143,361,050| 20.71 |120,079,754| 17.34 | - 1888 |155,057,432| 21.42 |121,605,094| 16.80 | - 1889 |163,548,106| 21.94 |115,079,918| 15.44 | - 1890 |170,637,250| 21.62 |116,924,080| 14.81 | - 1891 |184,175,197| 21.80 |136,446,309| 16.15 | - 1892 |188,317,595| 22.76 |112,729,303| 13.63 | - 1893 |209,277,112| 24.16 |135,608,418| 15.65 | - 1894 |130,086,011| 19.86 | 82,894,732| 12.65 | - 1895 |180,939,902| 24.72 | 96,486,622| 13.18 | - 1896 |197,646,852| 25.35 |101,070,937| 12.96 | - 1897 |196,159,371| 25.66 | 88,490,406| 11.57 | - 1898 |189,322,244| 30.73 | 79,288,417| 12.88 | - 1899 |208,565,691| 29.91 | 91,953,914| 13.19 | - 1900 |276,241,152| 32.50 |134,222,045| 15.79 | - 1901 |248,006,751| 30.13 |127,576,924| 15.49 | - 1902 |303,001,868| 33.55 |147,656,292| 16.34 | - 1903 |330,491,084| 32.22 |195,750,847| 19.08 | - 1904 |320,794,431| 32.37 |160,233,890| 16.17 | - 1905 |389,160,658| 34.82 |177,827,960| 15.91 | - 1906 |414,687,999| 33.81 |220,298,751| 17.96 | - 1907 |477,027,174| 33.25 |274,096,464| 19.11 | - 1908 |363,482,258| 30.43 |196,248,409| 16.43 | - 1909 |453,319,751| 34.55 |222,580,277| 16.97 | - ------------+-----------+--------+-----------+--------+ - ==================================================================== - | Manufactures | | - Year ending | ready for | Miscellaneous. | Total. - | consumption. | | - June 30-- +-----------+--------+-----------+--------+------------- - | | Percent| | Percent| - | Dollars. |of Total| Dollars. |of Total| Dollars. - ------------+-----------+--------+-----------+--------+------------- - 1820 | 30,998,900| 56.86 | 556,709| 1.02 | 54,520,834 - 1830 | 35,734,837| 56.97 | 582,563| .93 | 62,720,956 - 1840 | 44,300,005| 45.09 | 630,094| .64 | 98,258,706 - 1850 | 95,312,499| 54.93 | 845,174| .49 | 173,509,526 - 1860 |199,878,690| 56.52 | 3,536,119| 1.00 | 353,616,119 - 1870 |173,034,847| 39.69 | 5,024,834| 1.16 | 435,958,408 - 1875 |177,891,440| 33.38 | 9,645,884| 1.81 | 533,005,436 - 1880 |196,587,405| 29.43 | 10,303,952| 1.54 | 667,954,746 - 1881 |203,725,925| 31.70 | 11,035,942| 1.72 | 642,664,628 - 1882 |238,716,691| 32.94 | 11,556,826| 1.59 | 724,639,574 - 1883 |242,945,562| 33.59 | 12,648,195| 1.75 | 723,180,914 - 1884 |207,771,072| 31.12 | 12,288,615| 1.84 | 667,697,693 - 1885 |182,543,076| 31.61 | 13,671,507| 2.37 | 577,527,329 - 1886 |194,791,568| 30.65 | 16,310,485| 2.57 | 635,436,136 - 1887 |202,800,073| 29.29 | 8,002,275| 1.16 | 692,319,768 - 1888 |211,218,652| 29.17 | 8,940,754| 1.24 | 723,957,114 - 1889 |212,482,518| 28.52 | 8,635,860| 1.16 | 745,131,652 - 1890 |230,685,581| 29.23 | 9,251,325| 1.17 | 789,310,409 - 1891 |217,577,775| 25.75 | 8,355,632| .99 | 844,916,196 - 1892 |204,543,857| 24.72 | 6,458,073| .78 | 827,402,462 - 1893 |228,764,866| 26.40 | 7,347,377| .85 | 866,400,922 - 1894 |148,798,021| 22.72 | 4,557,045| .70 | 654,994,622 - 1895 |199,543,108| 27.26 | 6,596,915| .90 | 731,969,965 - 1896 |226,639,759| 29.07 | 5,559,113| .71 | 779,724,674 - 1897 |217,843,918| 28.48 | 4,611,981| .60 | 764,730,412 - 1898 |153,025,210| 24.84 | 4,338,165| .70 | 616,049,654 - 1899 |169,516,630| 24.32 | 4,730,863| .68 | 697,148,489 - 1900 |203,126,341| 23.90 | 5,407,979| .64 | 849,941,184 - 1901 |205,505,580| 24.96 | 6,157,048| .74 | 823,172,165 - 1902 |231,420,820| 25.62 | 5,611,410| .62 | 903,320,948 - 1903 |257,757,184| 25.13 | 5,896,825| .58 |1,025,719,237 - 1904 |252,857,673| 25.51 | 6,754,620| .68 | 991,087,371 - 1905 |252,372,650| 22.58 | 6,665,061| .60 |1,117,513,071 - 1906 |307,801,154| 25.10 | 9,100,980| .74 |1,226,562,446 - 1907 |364,192,884| 25.39 | 10,700,947| .75 |1,434,421,425 - 1908 |331,617,926| 27.77 | 10,406,902| .87 |1,194,341,792 - 1909 |297,617,739| 22.69 | 9,452,095| .72 |1,311,920,224 - ------------+-----------+--------+-----------+--------+------------- - - -Commerce of the United States by Great Groups, 1820 to 1909. 309 - -Exports (domestic). - - ================================================== - | Foodstuffs in | Foodstuffs partly | - Year | crude condition | or wholly | - ending | and food animals. | prepared. | - June +-----------+--------+-----------+--------+ - 30-- | | Percent| | Percent| - | Dollars. |of Total| Dollars. |of Total| - -------+-----------+--------+-----------+--------+ - 1820 | 2,474,822| 4.79 | 10,085,366| 19.51 | - 1830 | 2,724,181| 4.65 | 9,556,992| 16.32 | - 1840 | 4,564,532| 4.09 | 15,936,108| 14.27 | - 1850 | 7,535,764| 5.59 | 20,017,162| 14.84 | - 1860 | 12,166,447| 3.85 | 38,624,949| 12.21 | - 1870 | 41,852,630| 11.12 | 50,919,666| 13.53 | - 1875 | 79,077,679| 15.84 |110,292,780| 22.09 | - 1880 |266,108,950| 32.30 |193,352,723| 23.47 | - 1881 |241,641,847| 27.34 |226,386,821| 25.62 | - 1882 |155,008,497| 21.14 |178,002,738| 24.28 | - 1883 |163,196,443| 20.29 |186,392,822| 23.18 | - 1884 |130,395,872| 17.99 |194,703,245| 26.86 | - 1885 |123,326,867| 16.97 |201,800,801| 27.77 | - 1886 |100,799,692| 15.13 |162,689,021| 24.43 | - 1887 |125,453,686| 17.85 |175,784,781| 25.00 | - 1888 | 86,368,408| 12.63 |169,872,314| 24.84 | - 1889 | 98,847,455| 13.54 |174,504,227| 23.90 | - 1890 |132,073,183| 15.62 |224,756,580| 26.59 | - 1891 |106,155,721| 12.17 |226,448,303| 25.96 | - 1892 |262,455,846| 25.84 |250,438,545| 24.66 | - 1893 |153,277,859| 18.43 |247,075,061| 29.73 | - 1894 |133,196,928| 15.30 |249,846,142| 28.77 | - 1895 | 99,051,108| 12.49 |219,125,531| 27.62 | - 1896 |128,550,669| 14.90 |219,413,574| 25.41 | - 1897 |181,420,814| 17.58 |235,051,930| 22.79 | - 1898 |305,108,915| 25.21 |284,879,827| 23.54 | - 1899 |232,903,066| 19.35 |304,754,736| 25.31 | - 1900 |227,347,193| 16.59 |318,126,502| 23.28 | - 1901 |246,394,140| 16.88 |336,605,378| 23.05 | - 1902 |184,786,389| 13.63 |328,831,350| 24.27 | - 1903 |185,308,064| 13.31 |323,244,251| 23.22 | - 1904 |135,747,224| 9.46 |308,835,694| 21.52 | - 1905 |118,185,098| 7.92 |283,064,680| 18.98 | - 1906 |177,216,467| 10.32 |347,385,462| 20.22 | - 1907 |167,348,227| 9.03 |345,706,609| 18.65 | - 1908 |189,051,824| 10.30 |331,961,663| 18.10 | - 1909 |135,663,625| 8.28 |302,457,444| 18.46 | - -------+-----------+--------+-----------+--------+ - ================================================== - | Crude materials | Manufactures for | - Year | for use in | further use in | - ending | manufacturing. | manufacturing. | - June +-----------+--------+-----------+--------+ - 30-- | | Percent| | Percent| - | Dollars. |of Total| Dollars. |of Total| - -------+-----------+--------+-----------+--------+ - 1820 | 31,246,382| 60.46 | 4,867,379| 9.42 | - 1830 | 36,482,266| 62.34 | 4,117,606| 7.04 | - 1840 | 75,488,421| 67.61 | 4,841,101| 4.34 | - 1850 | 83,984,707| 62.26 | 6,060,900| 4.49 | - 1860 |216,009,648| 68.31 | 12,641,625| 3.99 | - 1870 |213,439,991| 56.64 | 13,711,708| 3.66 | - 1875 |206,271,795| 41.31 | 27,458,054| 5.50 | - 1880 |238,787,934| 28.98 | 29,044,159| 3.52 | - 1881 |278,918,722| 31.55 | 32,820,713| 3.71 | - 1882 |233,294,072| 31.82 | 37,164,800| 5.07 | - 1883 |288,841,684| 35.92 | 37,996,198| 4.72 | - 1884 |239,510,224| 33.04 | 37,800,437| 5.21 | - 1885 |248,611,181| 34.22 | 39,437,313| 5.42 | - 1886 |254,409,407| 38.21 | 34,037,715| 5.11 | - 1887 |250,236,436| 35.60 | 36,732,490| 5.22 | - 1888 |271,275,629| 39.67 | 40,176,023| 5.88 | - 1889 |286,235,227| 39.19 | 42,712,932| 5.85 | - 1890 |304,566,922| 36.03 | 46,454,992| 5.50 | - 1891 |346,848,321| 39.77 | 47,961,372| 5.49 | - 1892 |315,096,548| 31.02 | 50,284,241| 4.95 | - 1893 |247,289,240| 29.75 | 49,070,703| 5.94 | - 1894 |276,068,989| 31.70 | 67,145,189| 7.72 | - 1895 |264,194,679| 33.30 | 61,812,896| 7.78 | - 1896 |251,817,571| 29.17 | 76,219,728| 8.85 | - 1897 |296,834,858| 28.76 | 98,284,243| 9.52 | - 1898 |286,311,334| 23.66 |101,990,563| 8.43 | - 1899 |277,723,374| 23.07 |117,730,260| 9.78 | - 1900 |325,589,000| 23.75 |152,890,591| 11.15 | - 1901 |397,767,463| 27.24 |148,013,625| 10.12 | - 1902 |373,595,243| 27.56 |131,918,311| 9.73 | - 1903 |408,679,699| 29.35 |140,415,620| 10.09 | - 1904 |461,716,328| 32.17 |174,574,136| 12.17 | - 1905 |472,665,309| 31.69 |209,361,544| 14.03 | - 1906 |500,536,700| 29.13 |226,210,513| 13.17 | - 1907 |593,145,135| 32.00 |259,414,784| 13.99 | - 1908 |556,681,462| 30.33 |261,105,883| 14.23 | - 1909 |520,768,631| 31.78 |229,937,155| 14.04 | - -------+-----------+--------+-----------+--------+ - =============================================================== - | Manufactures | | - Year | ready for | Miscellaneous. | Total. - ending | consumption. | | - June +-----------+--------+-----------+--------+------------- - 30-- | | Percent| | Percent| - | Dollars. |of Total| Dollars. |of Total| Dollars. - -------+-----------+--------+-----------+--------+------------- - 1820 | 2,925,165| 5.66 | 84,526| 0.16 | 51,683,640 - 1830 | 5,461,589| 9.34 | 182,244| .31 | 58,524,878 - 1840 | 10,584,079| 9.47 | 246,320| .22 | 111,660,561 - 1850 | 17,162,206| 12.72 | 139,494| .10 | 134,900,233 - 1860 | 35,811,383| 11.33 | 988,371| .31 | 316,242,423 - 1870 | 56,329,137| 14.96 | 363,341| .09 | 376,616,473 - 1875 | 74,503,493| 14.92 | 1,680,299| .34 | 499,284,100 - 1880 | 92,774,139| 11.26 | 3,878,448| .47 | 823,946,353 - 1881 |102,458,449| 11.59 | 1,699,395| .19 | 883,925,947 - 1882 |124,835,385| 17.02 | 4,934,240| .67 | 733,239,732 - 1883 |122,448,549| 15.23 | 5,347,936| .66 | 804,223,632 - 1884 |118,172,882| 16.30 | 4,382,192| .60 | 724,964,852 - 1885 |110,818,865| 15.25 | 2,687,919| .37 | 726,682,946 - 1886 |111,627,312| 16.76 | 2,401,382| .36 | 665,964,529 - 1887 |112,417,839| 15.99 | 2,397,691| .34 | 703,022,923 - 1888 |113,892,689| 16.65 | 2,277,041| .33 | 683,862,104 - 1889 |123,183,883| 16.87 | 4,798,885| .65 | 730,282,609 - 1890 |132,527,050| 15.68 | 4,915,101| .58 | 845,293,828 - 1891 |140,349,741| 16.09 | 4,506,825| .52 | 872,270,283 - 1892 |132,792,441| 13.07 | 4,664,390| .46 |1,015,732,011 - 1893 |129,938,284| 15.63 | 4,379,638| .52 | 831,030,785 - 1894 |135,659,274| 15.61 | 7,288,415| .84 | 869,204,937 - 1895 |143,244,969| 18.06 | 5,963,407| .75 | 793,392,590 - 1896 |181,789,157| 21.04 | 5,409,788| .63 | 863,200,487 - 1897 |212,959,122| 20.63 | 7,456,636| .72 |1,032,007,603 - 1898 |222,537,358| 18.38 | 9,463,916| .78 |1,210,291,913 - 1899 |262,656,583| 21.81 | 8,163,203| .68 |1,203,931,222 - 1900 |331,955,684| 24.15 | 14,854,601| 1.08 |1,370,763,571 - 1901 |317,764,367| 21.76 | 13,917,833| .95 |1,460,462,806 - 1902 |321,946,540| 23.75 | 14,404,028| 1.06 |1,355,481,861 - 1903 |327,489,757| 23.52 | 7,100,911| .51 |1,392,231,302 - 1904 |348,745,843| 24.30 | 5,559,792| .38 |1,435,179,017 - 1905 |402,064,030| 26.95 | 6,403,980| .43 |1,491,744,641 - 1906 |459,812,656| 26.76 | 6,791,584| .40 |1,717,953,382 - 1907 |480,708,667| 25.93 | 7,394,612| .40 |1,853,718,034 - 1908 |489,469,958| 26.68 | 6,515,567| .36 |1,834,786,357 - 1909 |441,820,754| 26.97 | 7,707,984| .47 |1,638,355,593 - -------+-----------+--------+-----------+--------+------------- - - -Population of the United States 10 Years of Age and Upward, Engaged in 310- -Manufacturing and Other Gainful Occupations, Census Year 1900, by Sex. 311 - -[From reports of the Bureau of the Census, Department of Commerce and -Labor.] - - =======================================+=================================== - | 1900. - OCCUPATION. +-----------+-----------+----------- - | Male. | Female. | Total. - ---------------------------------------+-----------+-----------+----------- - AGRICULTURAL PURSUITS | 9,404,429 | 977,336 | 10,381,765 - PROFESSIONAL SERVICE | 827,941 | 430,597 | 1,258,538 - DOMESTIC AND PERSONAL SERVICE | 3,485,208 | 2,095,449 | 5,580,657 - TRADE AND TRANSPORTATION | 4,263,617 | 503,347 | 4,766,964 - MANUFACTURING AND MECHANICAL PURSUITS | 5,772,641 | 1,312,668 | 7,085,309 - | | | - Building trades. | | | - | | | - Carpenters and joiners | 599,707 | 545 | 600,252 - Masons (brick and stone) | 160,638 | 167 | 160,805 - Painters, glaziers, and varnishers | 275,782 | 1,759 | 277,541 - Paper hangers | 21,749 | 241 | 21,990 - Plasterers | 35,649 | 45 | 35,694 - Plumbers and gas and steam fitters | 97,659 | 126 | 97,785 - Roofers and slaters | 9,065 | 2 | 9,067 - Mechanics (not otherwise specified) | 9,351 | 27 | 9,378 - | | | - Chemicals and allied products. | | | - | | | - Oil well and oil works employes | 24,573 | 53 | 24,626 - Other chemical workers | 12,035 | 2,688 | 14,723 - | | | - Clay, glass, and stone products. | | | - | | | - Brick and tile makers, etc. | 49,455 | 478 | 49,933 - Glassworkers | 47,377 | 2,621 | 49,998 - Marble and stone cutters | 54,317 | 143 | 54,460 - Potters | 13,200 | 2,940 | 16,140 - | | | - Fishing and mining. | | | - | | | - Fishermen and oystermen | 68,478 | 462 | 68,940 - Miners and quarrymen | 562,417 | 989 | 563,406 - | | | - Food and kindred products. | | | - | | | - Bakers | 74,860 | 4,328 | 79,188 - Butchers | 112,815 | 378 | 113,193 - Butter and cheese makers | 18,593 | 648 | 19,241 - Confectioners | 21,980 | 9,214 | 31,194 - Millers | 40,362 | 186 | 40,548 - Other food preparers | 23,640 | 5,142 | 28,782 - | | | - Iron and steel and their products. | | | - | | | - Blacksmiths | 226,284 | 193 | 226,477 - Iron and steel workers | 287,241 | 3,297 | 290,538 - Machinists | 282,574 | 571 | 283,145 - Steam boiler makers | 33,038 | 8 | 33,046 - Stove, furnace, and grate makers | 12,430 | 43 | 12,473 - Tool and cutlery makers | 27,376 | 746 | 28,122 - Wheelwrights | 13,495 | 10 | 13,505 - Wireworkers | 16,701 | 1,786 | 18,487 - | | | - Leather and its finished products. | | | - | | | - Boot and shoe makers and repairers | 169,393 | 39,510 | 208,903 - Harness and saddle makers and repairers| 39,506 | 595 | 40,101 - Leather curriers and tanners | 40,917 | 1,754 | 42,671 - Trunk and leather-case makers, etc. | 5,472 | 1,579 | 7,051 - | | | - Liquors and beverages. | | | - | | | - Bottlers and soda water makers, etc. | 9,725 | 794 | 10,519 - Brewers and maltsters | 20,687 | 275 | 20,962 - Distillers and rectifiers | 3,114 | 30 | 3,144 - | | | - Lumber and its remanufactures. | | | - | | | - Cabinetmakers | 35,552 | 67 | 35,619 - Coopers | 37,087 | 113 | 37,200 - Saw and planing mill employes | 161,251 | 373 | 161,624 - Other woodworkers | 104,791 | 6,805 | 111,596 - | | | - Metals and metal products | | | - other than iron and steel. | | | - | | | - Brassworkers | 25,870 | 890 | 26,760 - Clock and watch makers and repairers | 19,305 | 4,815 | 24,120 - Gold and silver workers | 19,732 | 6,380 | 26,112 - Tin plate and tinware makers | 68,730 | 1,775 | 70,505 - Other metal workers | 54,282 | 2,320 | 56,602 - | | | - Paper and printing. | | | - | | | - Bookbinders | 14,646 | 15,632 | 30,278 - Box makers (paper) | 3,796 | 17,302 | 21,098 - Engravers | 10,698 | 453 | 11,151 - Paper and pulp mill operatives | 26,904 | 9,424 | 36,328 - Printers, lithographers, and pressmen | 139,166 | 15,981 | 155,147 - | | | - Textiles. | | | - | | | - Bleachery and dye works operatives | 20,493 | 1,785 | 22,278 - Carpet factory operatives | 10,371 | 9,001 | 19,372 - Cotton mill operatives | 125,788 | 120,603 | 246,391 - Hosiery and knitting mill operatives | 12,630 | 34,490 | 47,120 - Silk mill operatives | 22,023 | 32,437 | 54,460 - Woolen mill operatives | 42,566 | 30,630 | 73,196 - Other textile mill operatives | 53,437 | 51,182 | 104,619 - Dressmakers | 2,090 | 344,794 | 346,884 - Hat and cap makers | 15,110 | 7,623 | 22,733 - Milliners | 1,739 | 86,120 | 87,859 - Seamstresses | 4,837 | 146,105 | 150,942 - Shirt, collar, and cuff makers | 8,491 | 30,941 | 39,432 - Tailors and tailoresses | 160,714 | 68,935 | 229,649 - Other textile workers | 8,862 | 20,671 | 29,533 - | | | - Miscellaneous industries. | | | - | | | - Broom and brush makers | 8,643 | 1,577 | 10,220 - Charcoal, coke, and lime burners | 14,405 | 31 | 14,436 - Engineers and firemen (not locomotive) | 223,318 | 177 | 223,495 - Glovemakers | 4,503 | 7,768 | 12,271 - Manufacturers and officials, etc. | 239,649 | 3,360 | 243,009 - Model and pattern makers | 14,869 | 204 | 15,073 - Photographers | 23,361 | 3,580 | 26,941 - Rubber factory operatives | 14,492 | 7,374 | 21,866 - Tobacco and cigar factory operatives | 87,955 | 43,497 | 131,452 - Upholsterers | 28,663 | 2,158 | 30,821 - Other miscellaneous industries | 380,167 | 90,922 | 471,089 - ---------------------------------------+-----------+-----------+----------- - Total manufacturing and | | | - mechanical pursuits | 5,772,641 | 1,312,668 | 7,085,309 - ---------------------------------------+-----------+-----------+----------- - Grand total |23,753,836 | 5,319,397 | 29,073,233 - ---------------------------------------+-----------+-----------+----------- - - -World’s Development of Carrying Power, Production, and Commerce, 312 -1800-1907. - -[From “Transportation Systems of the World,” issued by the Bureau of -Statistics, Department of Commerce and Labor.] - - =======+===========+====================++=============================++ - | | Commerce. || Carrying Power. || - | | || || - | +-----------+--------++--------+--------+-----------++ - Year. |Population.| | || | | || - | | Total. | Per || Sail. | Steam. | Total. || - | | | capita.|| | | || - | | | || | | || - -------+-----------+-----------+--------++--------+--------+-----------++ - | Millions. | Millions | ||Thousand|Thousand| Thousand || - | |of dollars.|Dollars.||tons.[J]|tons.[J]|tons.[J][K]|| - | | | || | | || - 1800[M]| 640 | 1,479 | 2.31 || 4,026 | -- | 4,026 || - 1820[N]| 780 | 1,659 | 2.13 || 5,814 | 0.023 | 5,894 || - 1830[N]| 847 | 1,981 | 2.34 || 7,100 | .111 | 7,528 || - 1840[O]| 950 | 2,789 | 2.93 || 9,012 | .372 | 10,482 || - 1850[O]| 1,075 | 4,049 | 3.76 || 11,470 | .864 | 14,902 || - 1860[O]| 1,205 | 7,246 | 6.01 || 14,890 | 1.723 | 21,730 || - 1870[P]| 1,310 | 10,663 | 8.14 || 12,900 | 3.012 | 25,100 || - 1880[Q]| 1,439 | 14,761 | 10.26 || 14,400 | 5.901 | 37,900 || - 1890[R]| 1,488 | 17,519 | 11.80 || 12,640 | 8.295 | 47,800 || - 1900 | 1,543 | 20,105 | 13.02 || 8,119 | 13.856 | 63,543 || - 1906 | 1,600 | 26,500 | 16.50 || 5,469 | 21.094 | 89,845 || - 1907 | -- | -- | -- || 5,200 | 22.140 | 93,760 || - -------+-----------+-----------+--------++--------+--------+-----------++ - =======+=========+========+========++ - | | | || - | | | || - | | | ++ - Year. |Railways.| Tele- |Cables. || - | |graphs. | || - | | | || - | | | || - -------+---------+--------+--------++ - |Thousand |Thousand|Thousand|| - |miles.[J]| miles. | miles. || - | | | || - 1800[M]| -- | -- | -- || - 1820[N]| -- | -- | -- || - 1830[N]| 0.2| -- | -- || - 1840[O]| 5.4| -- | -- || - 1850[O]| 24.0| 5 | 1/40 || - 1860[O]| 67.4| 100 | 1½ || - 1870[P]| 139.9| 281 | 15 || - 1880[Q]| 224.9| 440 | 49 || - 1890[R]| 390.0| 768 | 132 || - 1900 | 500.0| 1,180 | 200 || - 1906 | [S]562.8| 1,200 | 200 || - 1907 | 595.8| -- | -- || - -------+---------+--------+--------++ - =======+================================+=========+=========== - | Production of Cotton, | | Gold - | Coal, and Pig iron. | |production, - |----------+-----------+---------+ | decade - Year. | | | | Area | ending - | Cotton. | Coal. |Pig iron.| cul- | year - | | | | tivated.| named. - | | | | | - -------+----------+-----------+---------+---------+----------- - | Million | Million | Million | Million | Million - |pounds.[J]| tons. | tons.[J]|acres.[J]|dollars.[L] - | | | | | - 1800[M]| 520| 11.6| 0.5 | 360 | 128.5 - 1820[N]| 630| 17.2| 1.0 | 402 | 76.1 - 1830[N]| 820| 25.1| 1.6 | -- | 94.5 - 1840[O]| 1,310| 44.8| 2.7 | 492 | 134.8 - 1850[O]| 1,435| 81.4| 4.4 | -- | 363.9 - 1860[O]| 2,551| 142.3| 7.2 | 583 | 1,334.0 - 1870[P]| 2,775| 213.4| 11.9 | -- | 1,263.0 - 1880[Q]| 3,601| 340.0| 18.1 | 749 | 1,150.8 - 1890[R]| 5,600| 466.0| 25.2 | 807 | 1,060.1 - 1900 | 6,247| 800.0| 41.4 | 875 | 2,100.0 - 1906 | [T]9,971| [U]987.9| [V]58.1 | 900 | 3,095.0 - 1907 | [T]8,256| [U]1,079.6| [V]59.7 | -- | 3,259.5 - -------+----------+-----------+---------+---------+----------- - - [J] Mulhall’s estimate, except 1830, 1890, 1900, 1906, and 1907. - - [K] Steam tonnage reduced to sail by multiplying by 4. - - [L] Soetbeer’s estimates prior to 1860. - - [M] Malte-Brun’s estimate for 1804. - - [N] Based on Balbi’s estimate for 1828. - - [O] Based on Michelet’s estimate for 1845. - - [P] Based on Behm-Wagner estimate for 1874. - - [Q] Levasseur’s estimate for 1878. - - [R] Royal Geographic Society estimate. - - [S] Estimates of the Archiv für Eisenbahnwesen. - - [T] Estimates of the United States Census Office. - - [U] Estimates of the United States Geological Survey. - - [V] Estimates of the “Mineral Industry.” - - -[Illustration: 1. CAPITAL INVESTED IN MANUFACTURING AT EACH CENSUS: 313 -1850 TO 1900] - -[Illustration: 2. AVERAGE NUMBER OF WAGE-EARNERS EMPLOYED IN -MANUFACTURES AT EACH CENSUS: 1850 TO 1900] - -[Illustration: 3. VALUE OF PRODUCTS AT EACH CENSUS: 1850 TO 1900] - -[Illustration: 4. PROPORTION WHICH AVERAGE NUMBER OF WAGE-EARNERS -EMPLOYED IN MANUFACTURES BEAR TO POPULATION -AT EACH CENSUS: 1850 TO 1900] - -[Illustration: 1. CAPITAL INVESTED IN MANUFACTURING IN EACH STATE 314 -AND TERRITORY: 1900] - -[Illustration: 2. CAPITAL INVESTED BY STATE GROUPS] - -[Illustration: 1. AVERAGE NUMBER OF WAGE-EARNERS EMPLOYED IN 315 -MANUFACTURES: 1900.] - -[Illustration: 2. AVERAGE NUMBER OF WAGE EARNERS EMPLOYED IN -MANUFACTURES BY STATE GROUPS] - -[Illustration: VALUE OF PRODUCTS OF CERTAIN MANUFACTURING INDUSTRIES: 316 -1850 TO 1900] - -[Illustration: VALUE OF ALL MANUFACTURED PRODUCTS IN THE U. S., AND 317 -PROPORTIONAL VALUE OF EACH GROUP: 1880 TO 1900] - -[Illustration: VALUE OF PRODUCTS OF MANUFACTURES PER SQUARE MILE: 318 -1900] - -[Illustration: VALUE OF PRODUCTS OF MANUFACTURES PER SQUARE MILE: 319 -1900] - -[Illustration: VALUE OF PRODUCTS OF MANUFACTURES PER SQUARE MILE: 320 -1900] - -[Illustration: VALUE OF PRODUCTS OF MANUFACTURES PER SQUARE MILE: 321 -1900] - - - - -CONCRETE AND STEEL. 322 - -BY J. F. SPRINGER. - -[New York author of articles in Applied Science.] - - -The life of properly made concrete is not known. However, specimens -from the times of the Romans are yet in good condition. This material -has very considerable ability to resist compression; it is practically -fireproof and teredo proof; when properly protected it is probably but -little deteriorated by weather changes; and, if properly made, it is -probably inappreciably subject to chemical disintegration when -submerged. But there is one palpable fault--it is weak when subjected -to tensile stresses. On the other hand--steel has great tensile -resistivity and is strong under transverse stress. These two -materials--concrete and steel--supplement each other in valuable -qualities. The possibility of using them in combination depends -largely upon the fact that their co-efficients of expansion are -practically the same for moderate thermal fluctuations. Steel is -easily corroded. Nor is it strictly fireproof, as temperatures which -are not excessive will induce bending and buckling. When it is -surrounded by concrete, steel is protected against both fire and -corrosion. - -In many situations, steel would not alone supply the best material of -construction. And the same remark applies to concrete. A striking -instance is the case of the six new docks in Baltimore. Three of these -had already been constructed of wood and stone, when it became evident -that the building of the remaining three and of the long bulkhead -which was part of the scheme along the same lines would entail a -larger expense than the use of reinforced concrete construction. Steel -by itself would have been impossible of consideration because of its -susceptibility to corrosion. Concrete alone could not be used because 323 -of the excessive cost of the increased amount of Portland cement. It -is said, that a retaining wall of all concrete would have cost about -$600 per linear foot. Reinforced concrete costs about $58 per foot. - -Steel is used, not merely as a reinforcement, but as the material of -forms. Used thus, it may, at times, not only retain the concrete in -position but also prevent the action of the surrounding soil or water. -The possibility of using steel for forms depends largely upon the fact -that many applications of concrete are becoming standardized rapidly. -Thus is permitted a re-use of the steel form that justifies the -expense. But the employment of steel forms sometimes involves the use -of steel in the handling of them. A further use, although perhaps more -remote, is in connection with the arrangements for the handling of the -mixed concrete and of the raw materials. Still more remote, but still -a necessary application, is the use of steel and iron in the crushing -mills and the like. When we look at the question and inform ourselves -of the ramifications, it is not difficult to see that concrete and -steel are materials whose engineering applications are mutually -involved. Concrete is certainly replacing steel in some applications. -But, notwithstanding this, these two are to be regarded as unopposed -to each other on the whole. - -When concrete is cast about steel, an adhesive bond ensues. But this -is scarcely to be regarded as sufficient to enable the two to act as -one under tensile stresses. A mechanical bond should be employed. This -is the explanation of the somewhat complicated forms of standard -reinforcement bars. - -Concrete properly reinforced is an admirable material for factory -construction. It permits of rapid erection, is fireproof, has a long -life, is adapted to weather conditions, and is economical. The floors -of concrete buildings are easily cleaned and do not develop splinters. - -One of the large automobile factories--that of the Geo. N. Pierce 324 -Company at Buffalo, N. Y.--is a good instance of the rapidity with -which reinforced concrete buildings may be erected. Within seven -months of the date of signing the contract with the Trussed Concrete -Steel Company, Detroit, Mich., which employs the Kahn system of -reinforcement, certain large structures were ready for use. The floor -space here is 325,000 square feet. It was necessary to provide a -number of large areas unbroken by supports. It was found possible to -use girders having spans of 55 and 61 feet. When subjected to a load, -a girder develops compressive strains above and tensile ones below. -The concrete is well adapted to withstand the one, but not the other. -In an ordinary bridge truss, there may be diagonals that are also -under tensile stress. In the Kahn system of reinforcement, a -horizontal bar from which rigidly attached diagonals extend upward and -outward is provided with a view of enabling the girder to withstand -the tensile stress. In accordance with this design the long girders -were constructed. Girders providing runways for 3-ton cranes were also -constructed. A load of 14 tons placed upon one of the reinforced -concrete girders having a span of 25 feet induced a deflection of only -1/16 inch. This girder is 12 inches wide and 22 inches deep and its -reinforcement consists of three 1 x 3 in. Kahn bars. Hollow tile was -largely employed here in connection with the concrete. - -What is known in the trade as the corrugated bar, supplied by the -Corrugated Steel Bar Company is a steel reinforcing rod which provides -shoulders by means of which the concrete is mechanically engaged. This -general type of reinforcement is, however, not confined to this -concern. By means of this style of bar, the engineer is able to secure -the desired mechanical interlock. As the concrete and steel expand and -contract they do so together--unless the temperature change is -excessive--and so the relation between the two is maintained. Such -standard types of reinforcing bars are applicable to multitudes of 325 -construction. An interesting example is the railroad bridge over the -Vermilion River near Danville, Illinois. There are three arches, the -central one of which has a span of 100 feet. About 130 tons of -corrugated bars were employed in the construction of this beautiful -bridge. - -Another good example of bridge construction is the bridge over the -Maumee River near Waterville, Ohio. This structure follows the designs -of the National Bridge Company. It has a width of 16 feet between -copings and crosses the river at a point where it is 1,000 feet wide. -It is said that this reinforced bridge will carry a load of 5 tons per -linear foot. The arches are 12 in number, the longest having a span of -90 feet, and the shortest, one of 75 feet. The loading of a bridge -arch produces a lateral thrust upon the piers. If the next arch is not -loaded, then this thrust is unbalanced and must be cared for. This was -done in this case by employing part of the 100 tons of reinforcement -in a vertical position. This bridge having a very long expectation of -life was built at a cost of $77,000. The total amount of concrete was -about 9,200 cubic yards. - -The city of Philadelphia has gone into the construction of city -bridges of concrete in rather an extensive way. Among a total of 30 or -more is the reinforced bridge across Poquessing Creek, having a span -of 71 feet. This bridge is rather flat, having a rise of but 9½ feet. -The reinforcement employed here consisted in part of angle bars placed -in pairs to form a kind of T-bar. The principal reinforcement here was -the arch ribs. These were each composed of two of the T-bars arranged -one above the other in such manner that their points of nearest -approach were at the crown. These were latticed together. Such ribs -were placed 4 feet apart. Transversely disposed steel rods held the -whole together. The mechanical interlock here depended upon was due, -no doubt, to the mutual disposition of the various rods, etc. - -A railway viaduct, one-half mile or more in length is another example 326 -of the Kahn methods. This structure belongs to the Richmond & -Chesapeake Railway and is located at Richmond, Va. There is a span of -70 feet which has girders nearly 6 feet deep. At another span the -girders, probably of about the same depth, sagged but ⅛ inch upon -removal of the falsework. - -A style of reinforcement much used consists of a net-like fabric of -metal. This is employed largely in floors to bind the whole mass -together. In the manufacture of this netting, a Canadian company has -found it desirable to repair the inevitable breakages of strands in -manufacture by the use of the Davis-Bournonville Company’s -oxyacetylene torch. It is said that welds can be made on the average -of one in two minutes in the case of an ordinary weight of the fabric. -This netting is made by expanding sheets of perforated metal from a -narrow to a considerable width. It is during this expansion that the -strands sometimes break. - -Another style of floor reinforcement is the fabric made from wire. -That floors properly reinforced are quite substantial may be judged -from the case of the United States Fidelity & Guarantee Company. Their -building in Baltimore was exposed to intense heat in the great fire of -1904. In fact, a considerable part of the side walls and the front -fell, leaving floors of concrete. A load of brick giving a pressure of -300 pounds per square foot was arranged on one of the floors to a -distance of 5 feet to each side of one of the girders. The deflection -amounted to ⅛ inch. This was about 1/20 of 1 per cent of the span. -This is an example of Hennibique construction. - -Reference has already been made to the Kahn truss reinforcement. With -the same general object in view, the Hennibique truss has been -designed. There are two horizontal bars, one above the other. The -upper is, however, not perfectly horizontal except near the center. -Towards either side, this bar rises as it recedes from the center. 327 -These two bars are enveloped by loose stirrups arranged vertically and -at intervals. These are open at the top and closed below. - -There are two varieties of piles--the bearing pile and the sheet pile. -Their duties are quite different. One sustains a compressive load, the -other withstands a transverse thrust. But concrete has been used for -both kinds. In the case of the bearing pile, its own intrinsic -qualities are eminently suitable. It has good compressive resistance; -it is teredo proof, and has the prospect of long life whether -conditions are wet, dry or a mixture of the two. Wood makes an -admirable bearing pile, if constantly submerged, but it is a prey to -the teredo. The necessity for constant submergence limits the -usefulness of the wood pile. It must be cut off below the hydraulic -level, and this necessitates carrying the foundation footings to a -lower level than would otherwise ordinarily be the case. With the -concrete bearing pile, on the contrary, the footings may be -constructed at any level desired as the pile itself may be partly -submerged and partly in the dry. However, the concrete pile may be -subjected to other than compressive stresses, especially during its -placement. And so, some reinforce it. Some, no doubt, have in view a -possible buckling when in the ground, particularly if the surrounding -soil is yielding. Reinforcement both longitudinal and transverse is -employed. Longitudinal bars are arranged at intervals around and -within the periphery. These may be bound together by separate hoops -disposed along the length or by wire wound about the longitudinals in -spirals. In the case of concrete sheet piling, the concrete supplies a -surface and forms a protective covering to the imbedded reinforcement -which is here a vital matter and consequently indispensable. In the -dock improvements at Baltimore, to which reference has already been -made, reinforced concrete sheet piling was largely used. The steel -sheet pile could not well have been used here because of its 328 -susceptibility to corrosion. The concrete slabs, 12 × 18 inches in -cross-section perform the duty of retaining masses of earth in place -both above and below the water line. There were certain other concrete -constructional elements of an auxiliary character. The total -reinforcement amounted to about 1,200 tons. - -With regard to its fireproof qualities, an eloquent testimonial arises -from the fact that the immense Marlborough-Blenheim Hotel at Atlantic -City, a concrete and tile structure, is said to enjoy a saving of -$18,000 per year in fire insurance premiums. The insurance is based on -$600,000. This structure is 560 feet in length and has a width varying -from 60 to 200 feet. - -Reference has been made to the close identity of the co-efficients of -expansion for steel and concrete for moderate intervals of -temperature. While this is so, if the thermal range is considerable, -the concrete and the steel cannot be expected to expand and contract -together. In most engineering construction, the range is small, say -150 degrees F., but there are exceptions. One of these relates to the -material used in tall chimneys. The hot gases which pass up these give -rise to rather high temperatures. In fact, it is well-recognized -practice to build a large part of such chimneys double, one shell -enveloping another, with an air space between. Some four or five years -ago what is, perhaps, the very tallest concrete chimney in the United -States was built for the Colusa Parrot Mining & Smelting Company, -Butte, Montana. It is 352½ feet high and has a flue 18 feet in -diameter. A solid wall 1½ feet thick constitutes the base of 21 feet -in height. Above this level, an air space 4 inches wide radially is -arranged between two shells of 5 and 9 inches thick. The inner one is -the thinner. The steel reinforcements used were T-bars. The footing is -of reinforced concrete and rests upon a fill 18 feet deep. A further -important factor which has to be considered is the serious effect 329 -of repeated stresses. Partly because of this, it is recommended that a -large factor of safety be adopted. Further, the best practice would -seem to be in the direction of a complete divorce between the inner -and outer shells all the way up and of a uniformity in wall thickness -from bottom to top. Vertical cracks have been noted in some chimneys. -This would indicate the advisability of strong circular reinforcement. -It is thought that a tone concrete following the formula 1:2:2 is -better for the outer shell than a cement mortar. It is said to be -stronger, denser and more impervious to water than a mortar following -the formula 1:3. In order to secure adhesion between layers, the fresh -concrete should be applied wet and the old should perhaps be -resurfaced by tooling. - -The compressive resistivity of the usual concretes is considerable. -However, in certain bridge construction in New York City, a need was -felt for a concrete which should have a very high compressive -resistance. And so experiments were made with a concrete formed by -substituting wire nails for the crushed stone. About 60 tests were -made with concrete following the formula 1:2:2⅔. The resulting -material was quite heavy. A cubic foot weighed 196 pounds as compared -with 130 to 160 pounds for ordinary concretes. Eighty-eight pounds of -nails were used in one cubic foot bringing the cost to about $2.30. -This was certainly very expensive material. But where extraordinary -qualities are desired, we have to spend money. Cubes were cast -measuring 6 inches on a side. These were tested to destruction at -different stages of maturity. After the lapse of one week, the lowest -crushing resistance obtained was 2,770 pounds per square inch and the -highest 3,330 pounds. After one month, the minimum crushing strength -was 3,050 pounds, the maximum 8,340 pounds, while the average was -5,645 pounds. When a year had gone by, it was found that four cubes -gave an average of 10,410 pounds. However, the average resistance of 330 -17,235 pounds was obtained in the case of cubes 15 months old. - -Since concrete is but little affected by water and by fluctuations -between wet and dry conditions, it is not at all remarkable that it -has been employed for sewer and water tower construction. In the -United States a high standpipe has been constructed at Attleboro, -Massachusetts. This is 118 feet high and has an internal diameter of -50 feet. The wall varies from 18 inches in thickness at the bottom to -8 inches at the top. The concrete was made according to the formula -1:2:4. There is another tower 110 feet high and having an external -diameter of about 35 feet. At Anaheim, California, a large tank -together with its substructure has been constructed entirely of -reinforced concrete. The floor of the tank is about 60 feet above the -surface. The tank itself is 38 feet in height and 30 feet in diameter -and has a wall varying in thickness from 5 to 3 inches. The -reinforcement employed was the twisted steel bar. - -In order to prevent corrosion of the reinforcement, it is thought -necessary to guard against water entering and dissolving away the -caustic lime contacting with the steel. One way would be to give the -concrete itself a very dense character. Another is to fill the -external pores with a bituminous or oleo-resinous paint. Or, an -insoluble substance suited to fill the pores may be one of the -ingredients when the concrete is mixed. Finally a flexible waterproof -coating may be employed where conditions permit. As to the steel -itself--it is desirable to have it uniform, as then reliance may be -placed upon calculations. For this reason, one of the great concrete -construction companies recommends mild steel as opposed to high carbon -steel. - -One of the great recommendations of concrete is that it permits -wonderful rapidity of construction. We had an example of this in the 331 -case of the Geo. N. Pierce automobile factory. Another was in -connection with the construction of junction caissons for certain -subsurface tubes of the tunnel of the Hudson Companies. These caissons -were three in number and were located on the Jersey shore opposite New -York City. These structures were quite large, being about 100 feet in -length and having a width of about 45 feet. These caissons, one or two -of which were put under air pressure, were constructed of concrete -with steel reinforcement. The use of concrete in the tunnel system and -in the Terminal Building has been very extensive. To complete the -concrete construction, about half a million barrels of Portland -cement, so it is thought, must be consumed. The Gatun Locks at Panama -will require only about four times this amount. The twisted steel bars -of the reinforcement have been used in large quantity. - -The work on the water front at Baltimore to which reference has -already been made involved a considerable variety of reinforced -concrete construction. For retaining walls sheet piles were employed. -These ordinarily had a face of 18 inches and a thickness of 12 inches -and a length of 27 feet. As it was not necessary to retain the soil by -an impervious bulkhead, these piles did not interlock. However, they -had to resist a horizontal thrust, and so wales were strung along the -outside at the top. These wales were themselves of concrete reinforced -by means of imbedded lattice girders of steel. In position, the -girders lay flat and thus gave their chief strength to the horizontal -thrust. The wales were supported, in part, by concrete piers. These -were placed by means of steel caissons. These cofferdams were of sheet -steel 27 feet deep and were sunk by open air methods. When in place, -the concrete was put in and the pier thus formed. An upward surface of -the pier provides a means of absorbing the horizontal thrust of the -wales. The piers themselves are, some of them, mutually tied together -across the dock; others are tied to reinforced concrete piles sunk in 332 -the body of the dock. The ties are themselves of reinforced concrete. -The steel of the caissons served only as a mold. It is now a matter -apparently of but little importance how soon it corrodes. The -extensive concrete work at Baltimore was done by the Raymond Concrete -Pile Company. - -While the question of the teredo seems to have been a factor at -Baltimore because of the probability of its presence in the harbor -when certain sewerage improvements are carried out, this matter was -really an insistent thing in connection with a wharf constructed by -the United Fruit Company at Bocas del Toro in the Republic of Panama. -This wharf is itself of reinforced concrete. But the bearing piles are -what interest us. The native wooden piling, so it seems, would at this -general location become seriously damaged by the teredo within a year. -Some kinds of timber might be expected to have a longer life. The -service of creosoted piles has been estimated as about 15 years. -Besides, piles 70 feet in length were desired. This requirement put -the ordinary reinforced concrete piles out of consideration. What was -actually done was to use an untreated timber pile and then to encase -it where it passed through the water in a reinforced concrete shell. -This shell was made of such size as to allow a space between it and -the enclosed wooden pile. A rich concrete was put in this space at the -bottom and thus excluded the external water. Upon pumping out the -retained water, the major portion of the space was filled with a lean -concrete and a top layer of rich concrete then added in which the -column reinforcement was placed. The steel used for reinforcement was -in the main round bars of mild steel. The piles averaged 58 feet in -length; the shells, 18.4 feet. The cost of these shells was $1.78 per -linear foot. It is said that the cost of the untreated wooden pile -together with its protective coating was not greater than what would -have been the expense for a creosoted pile. - -At both the Baltimore docks and the wharf in the tropics, concrete 333 -is exposed to the action of sea water. But there is no violence in -this action. However, a very large application of concrete -construction has been recently carried out in a very much exposed -maritime situation off the coast of Florida. It is 156 miles from the -mainland to the island of Key West. Scattered along this interval are -a number of islands, so that in reality the total linear amount of -intervening land is about one-half the distance. Some of the water -passages are only a few hundred feet in width; one is about 2½ miles -wide. The greater portion of the aqueous route is of a shallow depth. -But for about 6 miles the water reached depths up to 30 feet; and this -in connection with an exposed situation. Reinforced concrete viaducts -have been built to accommodate trains and resist the storms. A quarter -million barrels of cement and about 5,700 tons of steel went into -these works. - -The viaduct from Long Key is 2 miles long and passed through water -having a depth ranging from 13 to 20 feet. The floor of the Gulf is of -coral. To construct a pier, about 30 piles would be driven in with -their tops projecting up from the floor. A cofferdam would be sunk to -include them and a seal of concrete 1 yard thick be placed. The water -could now be pumped out and the form concreted. The reinforcement -would, of course, be put in place before depositing this concrete. The -pier would then be allowed 3 weeks to mature. The concrete was mixed -with fresh water to avoid the effect of sea water on the steel. -Corrugated bars were used in reinforcing the walls and the 184 arches. -High water is 31 feet below the top of this structure, so that the -track is well protected from the waves. - -It may surprise some, but concrete has actually been used as the chief -material in the construction of boats. A reinforced concrete boat was -built thirteen years ago for use on the River Tiber in Italy. Not only -the hull but posts and roof of the structure above deck were of 334 -concrete. This house boat was 67 by 21 feet. Another Italian boat is -the Liguria, a barge in actual service. It is 57 by 18 feet and is -rated at 150 tons. The Gretchen is an American example of the stone -boat. She has sailed over long distances on the Atlantic and was -reputed as comparatively a rapid sailer in a heavy sea. Her -reinforcement was a multitude of small rods. This boat drew 14 feet of -water and was 65 feet long and had a beam measurement of 16 feet. - -Concrete is an obvious material for coal pockets, especially because -of its fireproof character. A further advantage is the avoidance of a -large maintenance charge. At Charlestown (Boston), the Lehigh & -Wilkes-Barre Coal Company had been expending about $1,000 yearly on -repairs upon a coal pocket. This has now been replaced by a concrete -structure having a capacity of 10,000 tons. It has a depth of 24 feet, -and has a length of 182 feet and a width of 92 feet. It is founded -upon 750 Simplex concrete piles. If wooden piling had been used, the -amount of excavation thus necessitated would have been very -considerable because it would have been necessary to cut them off 10 -feet below the surface in conformity with the building laws. Moreover, -about 2,000 wooden piles would have been required because of the limit -of ten tons’ bearing capacity per pile. With the concrete piles, -however, the footings for the columns were constructed with but little -excavation. The columns, side walls, girders, beams, floors--pretty -much everything except the roof--were of reinforced concrete. When a -full load of coal is filled in on the floor, the weight per square -yard is 18 tons. - -A similar application is to the construction of grain elevators. -Reinforced concrete has been used at Baltimore in two important -buildings of this kind and also in the case of a third at Buffalo. The -question of fire is here very important. The grain elevator of the -Pennsylvania Railroad at Baltimore is the largest of the three and is 335 -constructed to hold 1,000,000 bushels. There are 53 cylindrical bins -having a common height of 79 feet. There are four rows of eight each. -The remaining twenty-one bins occupy spaces in between, three rows -seven in a row. The set of 32 have the larger size and measure 24.2 -feet in internal diameter. The walls are 8 inches thick and have both -vertical and circumferential reinforcement. The vertical reinforcement -is round bars of 1⅜-inch diameter. The circumferential reinforcement -consists of interlaced flat bars. By a patented device the bins were -cast in sections. This mold would be attached to the heavier vertical -reinforcement and jacked up as needed. - -It is unnecessary to emphasize the fact that concrete while economical -is not cheap. So that when large masses are used, it is advisable to -reduce the expense by using what may be called “pudding stones.” At -McCalls Ferry a large dam and adjoining power house span the -Susquehanna River. This is a tremendous application of concrete. -However, pudding stones were very properly employed in the -construction of the great dam. Here steel was employed not so much to -reinforce but to supply frames for the molding surfaces. Great pelican -cranes of steel were also employed to handle the concrete, etc. The -face of the dam is a double curve and thus required a precise mold. -Sections of the dam, 40 feet in length, would be constructed to -alternate with open spaces of the same length. When it was desired to -close such open spaces, a great steel apron would be let down on the -upstream face. Concrete could then be laid in the open space. - -In all the applications of reinforced concrete with which our -attention has so far been occupied, the case has either been one of -well-recognized practice or closely related to such practice--with the -possible exception of concrete barges. There are two other lines of -engineering application in which it is very desirable to employ 336 -concrete, but where we are scarcely entitled to regard its use as -anything more than experimental. Reference is made to telegraph poles -and cross-ties. If a concrete pole really proves adapted to its -service, then we may expect a great reduction in maintenance expense. -It is estimated that renewals of wooden poles in the United States -cost yearly $13,000,000. The prospect of getting a pole which will not -need renewal for a long period is certainly attractive. But the actual -service is severe. This is due not so much to the load which must be -carried as to the horizontal movements under wind pressure. But by -using proper reinforcement, it is thought by some, the pole may be -made to withstand the horizontal thrusts. Some experiments have been -made of a type of pole recommended by the American Concrete Pole -Company, Richmond, Indiana. Four vertical rods bound together by wire -constitute the reinforcement. Such a pole 7 x 7 inches at the top and -12 x 12 inches at the bottom was tested to destruction. This pole was -30 feet long and had its butt end sunk 5 feet into the ground. The -vertical rods were ⅝ inch in diameter and were bound with No. 9 -wire. A horizontal thrust or pull at the top of 840 pounds -accomplished a deflection of 6 inches. When this was increased to -1,780 pounds, the deflection amounted to 17 inches. When 2,800 pounds -pressure was employed, the deflection was 30 inches accompanied by a -slight cracking. A deflection of a full yard together with cracking at -the ground line resulted from a pressure of 3,640 pounds. When 7,200 -pounds pressure was employed, the cracking became bad and the -deflection amounted to 60 inches. A cedar pole of the same size was -deflected 11 inches by a pull of 840 pounds. With 1,780 pounds, the -deflection was nearly a yard (33 inches); and with 2,200 pounds the -pole broke about 3 feet from the ground. The problem of the telegraph -pole will probably be solved, if this has not already been done. 337 - -With regard to the cross-tie the case is more difficult. Plain -concrete slabs or beams cannot be used after the manner of the wooden -tie because of their want of elasticity. What is called “center -binding” would be disastrous to plain concrete. The rocking action of -the passing load is also a factor which enters. One method of dealing -with center binding is to divide the tie into two parts, connecting -them with steel rods. The Corell tie is an example of this. In the -Percival tie, the under part of the concrete block is given a -sharpened edge. Beneath the rail itself, the cross-section is a kind -of oval. There is longitudinal reinforcement in the form of four rods, -three arranged at the top and one near the bottom. Three rods are -bound with wire. There is a cushion block of wood which absorbs and -distributes the shocks from the bottom of the rail. Screw spikes and -metallic sockets are employed. Some three or more years ago a hundred -such ties were put in service in a Texas railway. In June, 1909, seven -only were found to have received serious injury. It is thought that -this damage was scarcely chargeable to the ties themselves as when in -position they were between wooden ones whose deterioration might -easily have been the cause of undue disturbance being thrown on the -concrete ties. - -We have considered to a slight extent the use of steel as the material -of concrete forms. This line of application, however, promises to -become a very large one. Two notable constructions are now under way -in which the steel form plays a large part. These are the great Gatun -Locks of the Panama Canal and the Catskill Aqueduct. The three double -locks at Gatun will require about 2,000,000 cubic yards of concrete. -Each pair of locks is on a separate level and has three longitudinal -walls. One separates the lock chambers. This central wall is 60 feet -in width. It is not solid as so much concrete would not be required as 338 -the water level is approached. Consequently, there is a kind of -V-section which traverses it longitudinally. This is filled in except -for three galleries--one for drainage, one for the electric wires and -one for the men. There is a longitudinal culvert arranged below the -fill in the body of the concrete wall. In the side walls of the lock -chambers are other longitudinal culverts. From the central supply -culvert transverse distributing culverts run off beneath the floors of -the adjacent lock chambers. These have vertical outlets into the lock -chambers themselves. Similarly, but for purposes of emptying the -locks, the longitudinal culverts arranged along the outside are -connected by transverse culverts and vertical openings with the lock -chambers. The members of the two systems of transverse culverts -alternate with each other. The main supply culvert has a diameter of -22 feet part of the way and of 18 feet part of the way. Now these many -culverts, various in form and size, are to be molded in the mass -concrete by means of steel forms. As originally announced, there would -be 12 forms of open hearth boiler steel for the main supply culvert. -Each of these weighs 177,000 pounds. One hundred forms were to be -required. The two main outlet culverts of similar dimensions to the -main supply culvert were thought to require 21 forms, each 12 feet in -length and having a weight of 300,000 pounds. The transverse culverts -were to require 100 forms, each having a length of 10 feet and a -weight of 217,000 pounds. There were thus to be 133 forms having an -aggregate weight of 15,000 tons. It is possible that there may be some -modifications of this plan in minor particulars. The side walls of the -lock chambers are to be mainly vertical planes having a height of, -say, 81 feet. To retain the fresh concrete in place, 12 face plates, -constructed of sheet steel are to be used. These are 7½ inches in -thickness, having face dimensions 78 x 36 feet. Steel towers running on -suitable tracks control these face plates. It is estimated that 339 -towers and plates will have an aggregate weight of 26,000 tons. So -that, quite apart from any possible reinforcement application, steel -to the total of about 41,000 tons is to be used for forms and -immediate accessories. But this 41,000 tons is not all. The concrete -is to be cast in great monoliths and to retain the ends of these while -the concrete is fresh, steel girders 6 feet high are to be employed. -If these locks were to be of stone then steel would have played a -rather subordinate part. - -The Blaw Collapsible Steel Centering Company are engaged at Panama, -but they are also applying their systems of molding concrete to the -great aqueduct which is to supply New York City with water from the -Catskill Mountain region on the other side of the Hudson River. A -steel centering is used to give form to the interior. Steel forms are -also employed to shape the upper part of the external surface. At -Baltimore, more than three miles of sewer construction was carried out -in accordance with the system of the same company. The centering used -for one portion where the height was 11 feet and the width 12¼ feet -(inside) was employed in 50-foot lengths. In 2 hours, 6 men could -remove such a 50-foot section together with its falsework and have it -in readiness for a repetition of its service. A typical half-round -Blaw center consists of one or more steel plates bent to conform to a -cross-section of a semi-circle. Turnbuckles retain this shell in -position. If we are going to employ this form in sewer construction, -we first dig out our trench to such dimensions and form as to furnish -the mold for the outside surface of the lower part of the concrete -sewer. We then lay concrete in a longitudinal strip along the bottom, -giving the upper surface the form of a shallow gutter. When this is -sufficiently hardened, the semi-circular center may be slid along it -to suitable position. The center has its concavity opening upwards. -The concrete of the invert of the sewer is now placed. The same or a 340 -duplicate center may now be used to mold the interior of the upper -part of the sewer. - -Portland cement has been in use for a long time. But reinforced -concrete is so modern that in some important lines of engineering -application the fundamental data underlying practice are not fully -determined. In what may be regarded as the first decade (1870-1880) of -the considerable manufacture of Portland cement in the United States, -the total amount produced was only 42,000 barrels. Fifty years and -more would be required for the production of enough cement to -construct the Gatun Locks. Over a decade would be necessary to yield -enough cement for the operations of the Hudson Companies. The price at -this period was about $3.00 per barrel. In 1908 it was 85 cents. But -the production in this year was more than 1,200 times that in 1880. -The value per year of the present output is about $50,000,000. - - - -CHEMISTRY AND THE INDUSTRIES. 341 - -BY BENJAMIN BALL FREUD, B. S. - -[Assistant Professor of Analytical and Organic Chemistry, Armour -Institute of Technology.] - - -Chemistry has always been a utilitarian science, a science whose -direct applications to our every-day interests has been on every side -recognized. Even in the days of alchemy, that fantastic forerunner of -our present science, her devotees were concerned with the changing of -the base metals into the noble ones, of lead into silver, and of -copper into gold, and also with the search for the philosopher’s -stone, that mysterious something which would give perpetual youth. - -From these workers arose in the course of the years, the facts and the -theories which were incorporated into the science of chemistry. But it -is not entirely to the alchemists that chemistry owes its development. -By far the greater number of facts, if not of theories, came down to -us through the traditional knowledge of the chemical industries. -Numerous animal and vegetable products, such as sugar, starch, the -oils, gums and resins, had been familiar commodities as long back as -history records. And the ancients were informed in such typically -chemical industries as that of dyeing with vegetable dyes, pigment -manufacture, varnish making, soap making, paper making and the -fermentation industries. In fact the science of chemistry as we have -it today owes much more to these unknown workers in the industries who -transmitted their chemical facts from father to son, than it does to -the creations of the imaginations of those picturesque, if not so -truthful, alchemists. - -It is entirely impossible to divorce the science of chemistry from 342 -its industrial applications. The science owes much to the industries. -The industries owe even more to the science. And if that relationship -has been very close in the past, it is much closer now than it ever -was; and it is getting closer all the while. The utilitarianism of our -age makes it absolutely necessary that the two shall be so united that -the utmost of good shall result from the union. - -The application of science in general, and of chemistry in particular, -to the industries has this one general result. It takes that industry -out of the “rule of thumb” class, and places it firmly on a sound -basis. It is no longer conducted in a haphazard manner, but according -to intelligent design, based on the most accurate scientific -information. Of course the fierceness of business competition has -ordered this change, more than any other factor. The pure science of -chemistry would have developed without industrial applications, -because there are investigators who are seeking the truth regardless -of any of its immediate applications. But in the industries, it is a -matter of dollars and cents. The most efficient is the winner. And the -most efficient is the one who utilizes in his business all the -scientific information that can be brought to bear on the subject, and -who is always looking for new facts that can be applied. - -Chemistry, then, is applied to the industries in two distinct ways, -the first in discovery, in finding a new substance which can be used, -or a new process by which some useful or necessary substance can be -made; the second in improvement, in making a certain product better, -or cheaper, in utilizing wastes, or in starting from cheaper raw -materials. - -There are but two kinds of industries: (a) Those which are based on -processes which change the form of matter, such as the manufacture of -furniture for example, and (b) those which are based on processes -which change the composition of matter, such as the manufacture of -Portland cement from clay and limestone. Now group “b” comprises 343 -by far the greatest number of industries, and since the science of -chemistry concerns itself with just those changes in the composition -of matter, it is evident that most of our industries are chemical in -their nature. We have but recently come to realize this. A list of -such industries and operations which are essentially chemical would be -found to include almost every industry that we can think of. I need -only make mention of the subject of fuels, gas and coke, of cement, -mortars, brick and other building materials; of petroleum and its -products; of asphalt; of the products of the destructive distillation -of wood; of cellulose and of paper; of pigments, resins, varnishes; of -rubber; of soap, fats and the fatty oils; of gums; of sugar and of -starch; of the textile industries and of the dyes; of leather and -glue; of explosives; of the heavy chemical industries, the manufacture -of acids, alkalies and salts; of the manufacture of glass and the -ceramic industries; of the fermentation industries; of the manufacture -and standardization of medicines; of the subject of soils and -artificial fertilization; of the subject of foods, and of nutrition; -of the subject of water, sewage and sanitation; of photography; of all -the electro-chemical industries and processes; of the production of -steel, of copper, of lead and of all the other metals. I need only -mention this formidable array of subjects and industries to convince -the most sceptical one that chemistry does in fact, concern us, -directly or indirectly, in all of our activities. - -As I have said previously, chemistry influences industry in two -distinct ways: First, in the discovery of new substances and new -processes; secondly, in the perfection of known substances and known -processes. In either of these fields the chemist is proud of his -record. The conquests are so numerous that he is at a loss as to how -or where to begin if he would tell of them. The whole field of -industrial chemistry is one succession of chemical achievements, -mammoth industries that had their humble birth in the chemist’s test 344 -tube, his beaker, or his retort; the wealth of by-products saved to -the world from what was a few years ago sheer waste; and above all -increased efficiency in the manufacture of all products. The chemist -does not claim more than his due when he points out that his activity -covers the whole field of our daily experiences, and that his activity -has always been for the lessening of waste, for greater efficiency, in -a word, for the development of civilization. To illustrate the points -which have already been brought out, the story of the soda industry, -the beginning of the modern chemical industries, can be used. The -beginning is far back in another century, so intimately is the -development of the soda industry bound up with the advance of -civilization. - -The value of what we now call the alkalies as detergent substances, -was known from the earliest times. The first alkali recorded in -history is burned lime, and was called “caustic” on account of its -characteristic property. Caustic lime is but slightly soluble in -water, hence its use is greatly limited. History fails to tell who it -was who first solved the problem of making a more soluble alkali, but -some one, early in the Middle Ages, discovered that by the action of -caustic lime on the so-called potashes, the ashes which remained on -burning wood, a very soluble caustic was formed. And to this, the long -since forgotten chemist gave the name “caustic potash.” The chemistry -of the discovery is as follows: All plants take potassium, a very -light metal, in some form or other from the soil, to form the -so-called mineral, or bony structure, in other words the skeleton, of -the plant. When these plants are burned the potassium in the form of a -salt, chiefly potassium carbonate, is formed in the ash. These -potassium salts can be extracted by water, and recovered on the -evaporation of the water. These potassium salts, the so-called -“potashes,” were extensively used in the industries of the time, for -example, in making soap, in making glass, in dyeing and in a score of 345 -other minor ways. But even as our forests cannot now meet the demand -for timber, so they could not then meet the demand for the “potashes,” -for it requires a large amount of wood to give a comparatively small -amount of potashes, the percentage of potassium salts in wood being -very small indeed. Simultaneously with all this, in northern Spain, on -the seacoast, a number of towns were engaged in burning sea weeds. It -was found that the ashes of sea weeds while not the same as potashes, -nevertheless could be substituted for them. This is historically -recorded as the “barilla” industry. Barilla consisted of 5 per cent of -carbonate of sodium, a metal very similar to potassium. Sodium does -for sea plants just what potassium does for land plants. Barilla was -merely a substitute for potashes, and a very poor substitute at that. -But it was destined to offer the key that solved the whole problem. -The chemists of that time showed the chemical similarity between the -active ingredient of potashes, carbonate of potassium, and the active -ingredient of barilla, carbonate of sodium. The demand for these -alkalies made by the industries was incessant and ever-increasing. The -chemists realized that the direct natural sources of the two, namely, -the wood of the forest and the weeds of the sea, were and always would -be, inadequate to meet the enormously growing demands of the -industries. They saw that some other source would have to be -discovered, or the bodies would have to be prepared artificially. They -realized that while potashes were better than barilla, nevertheless -potassium salts, the ingredients of potashes, were much less widely -distributed in nature than the sodium salts, the ingredients of -barilla. So they set out with the definite object of preparing sodium -carbonate. In 1791 LeBlanc took out a patent for his now famous -process. He was not the only one who worked on the problem; he -happened to be the successful one. - -This was the first of the great triumphs of chemistry in the industrial 346 -field. The significant point in this story of soda, is that those -industries which were using the alkalies had reached the limit of -their development, because the supply of the alkalies was so limited. -Remember, also, that those industries were fundamental ones. Some -historian has said that you can measure the civilization of a people -by the amount of soap it uses. And here, we see the soap industry of -Europe, the seat of our present civilization, crippled for want of an -alkali. The position of the chemist, his responsibility to society, is -the significant thing in the story. Here was a crisis in the -development of civilization, as important to us as the crisis of the -battle of Marathon. Because the problem was solved in the retort, -instead of on the battle plain, because the battle was fought by the -quiet hand of the chemist, instead of by the fighting men of Greece, -we do not hear so much of it. But it was a triumph, and the credit -belongs to the chemist. To us, as much depended upon the result of the -battle of the molecules in the retort, as upon the defeat of the great -Darius. - -Nor was this battle in the retort a tame one. LeBlanc’s method is an -extremely complicated one. To conduct the process at all requires -chemical knowledge of the most varied kind. And to apply the -improvements that have been worked out in the laboratory, and to carry -into practice the many subsidiary manufactures that have sprung from -this main industry, demands so much technical ability that it has been -said that this manufacture is not merely the foundation of the immense -chemical industries of today, but is also the guiding spirit in them. - -LeBlanc, of course, could not foretell the enormous development his -industry was to attain. Nor could he conceive of the ramifications -running from it into countless other activities of our present -civilization. The manufacture of sulphuric acid, one of the most -important products of modern industry, is intimately bound up with -that of soda. And, in the manufacture of sulphuric acid, nitric acid 347 -is required, and must be made. Hydrochloric acid is a by-product of -the soda process, and was for a long time permitted to go to waste. -Now it is one of the most valuable products of the LeBlanc soda -process. It is used to make bleaching powder, potassium chlorate, and -otherwise in the industries. Also, the alkaline waste from the soda -process is rich in sulphur. This sulphur is now recovered and put on -the market as such, helping to meet the demand for sulphur that the -Sicilian mines cannot supply. - -All those varied industries that were either created or fostered by -the soda industry have made possible the almost fabulously complicated -processes that are now carried out in the manufacture of the aniline -dyes, the artificial odors, like vanillin whose complexity can be -gathered from its formula, C_{6}H_{3}OHOCH_{3}CHO, which tells many -things to the chemist, but not much to the layman, and the artificial -febrifuges like antipyrin, whose formula is C_{11}H_{12}N_{2}O. All -these chemical industries that are the outgrowth of the soda industry, -and that are so dove-tailed with our civilization, have been built up -on the science of chemistry, and worked out by chemists. I have -selected this story of soda to show the commanding position held by -the science of chemistry in directing the course of civilization. It -shows, too, how the entire structure of that civilization is built -around the contributions of the chemist. - -As has been already said, it is impossible to separate chemistry from -industry. The farther we go and the more we develop and the more -complex our civilization becomes, the closer become the ties uniting -science and industry. And as everything that deals with the change in -composition of matter is chemistry, it is evident that chemistry is -omnipresent. In the light of what it has accomplished, who shall say -that it is not omnipotent? - -The story of soda is a beautiful example of how industry and the need -of civilization can act as a beacon light for the science of 348 -chemistry. This illustration will show how the pure science has -created new industries and opened up new activities for civilization. -In 1838 in England, there was born a boy who afterwards was to be -known as Sir Wm. Perkin. He came of a very intelligent family. -Besides, he was gifted with a natural aptitude for chemistry. More -than that, he was put under the direction of Professor Hofmann, one of -the most brilliant of chemists. Perkin would have been called by any -one, an ideal bit of raw material. Hofmann, like many others of those -German chemists, had a faculty of instilling that enthusiasm that is -necessary in the performance of an epoch-making advancement. Perkin -caught that enthusiasm. He rigged up a laboratory in his house and -worked at night and in his vacations on those interesting problems -that Hofmann discussed in his lectures. During one of these vacations, -he was trying to build up, artificially, the substance called quinine, -which was up to that time a purely natural product. His work took an -unexpected turn. Instead of building up quinine, he built what -chemists call now phenyl-sufranine, or mauvëine. This was a new -substance with properties that rendered it an excellent dye. Perkin -established a factory in which the new substance could be prepared on -a large scale; and within a year of its discovery, he had it on the -market. This discovery of Mauve, the first of the artificial dyes, -gave a great impetus to the study of coal tar, from which it was made. -Coal tar, up to that time, was a waste product, made in the process of -heating coal for the manufacture of gas. This coal tar is the raw -material which is used in that enormous chemical industry, the -manufacture of the derivatives of tri-phenyl methane, the so-called -aniline dyes. There is invested in this industry alone, $750,000,000; -and the whole structure, complex as it is, is built on the foundation -of a pure chemical research that was undertaken merely to gratify the -investigative desires of a true scientist, with no thought of its 349 -financial results. This achievement of Perkin stands out as one of the -great discoveries of chemistry. And the story of Mauve shows how -science has led the way for industry, just as the story of soda shows -how industry has pointed out the way for science. - -Many more stories of the victories of scientific industry could be -told. Much has been done. But the chemist does not live in the glory -of the past. He lives in the possibilities of the future. Every -advancement of the past has opened up many fields of possibilities. If -much has been done, much more remains to be done. And the work of the -future will require the services of the scientist more than did the -work of the past. Those problems whose answers were obvious, have all -been solved. The problems of today are deep ones; they require all the -ingenuity, all the ability that the trained chemist can bring to bear -upon the problems. And they will all tend to increased efficiency. - -While chemistry is a fundamental science, while it covers such a -variety of subjects, while the total amount of its established facts -is indeed enormous, nevertheless, it must be said with frankness that -this vastness is made up for the most part by details and more or less -isolated facts and ideas. Chemistry can boast of remarkable -achievements. But the greatest achievements are yet before it. And the -reason is this: Chemistry is not yet a really unified science. The -real fundamentals which will string together all of the isolated facts -and ideas, material of which the chemist has, indeed, reason to feel -proud, are for the most part lacking. That is why the future is so -much larger than the past. And that is why the world can expect from -the chemists much greater achievements in the future than it has seen -accomplished in the past, great as they have been. - -In the most fundamental terms, chemistry concerns itself with the -changes which the different kinds of energy produce upon matter. 350 -Chemistry concerns itself with two things, energy and matter. And yet -chemistry must admit that it does not know the nature of matter or the -nature of energy. And not knowing, it cannot appreciate. - -In this direction lie the achievements of the chemistry of the future. -As the nature of matter and the nature of energy gradually unfold -themselves to the advances of chemical investigation, remarkable -possibilities for future development are disclosed. We are beginning -to see how really wasteful we have been. The frightful wastes which -the movement toward the conservation of our natural resources has -called to our attention, sink into utter insignificance when we -consider what we have lost on account of our ignorance. We are just -beginning to appreciate our wastefulness of chemical energy. A piece -of coal, for example, has in it the possibility of doing ten times as -much work as it is doing now. A piece of radium has stored in it an -almost infinite amount of energy. How to change this internal or -chemical energy into the other forms of energy with which we are -familiar, into heat, or electricity, or ordinary mechanical energy, -that is the problem of the future. The utilization of this vast amount -of potential energy that is stored up in all forms of matter, the -harnessing of it in the service of humanity, this is the problem which -confronts the chemist. It goes down to the very fundamentals of his -science. - -But the start has been made. The point of the wedge has already found -entrance. The discovery of radium, and the study of its -decompositions, has opened wide our field of vision. The problem must -yield, as the blows of chemical investigation fall upon the wedge and -drive it home. - -Chemistry has always been a utilitarian science. Its results have -always been at the service of humanity. And if we can judge the future -by the past, even discounting for the enthusiasm of the chemist, we -can forsee improved processes which will reduce our present wasteful 351 -methods; we can see new processes making for us such things as india -rubber from starch, for which we must now depend upon the bounty of -nature; and we can dimly see the time when we shall be able to utilize -some of that energy which is hidden away in the recesses of matter, -and whose vastness we have just begun to appreciate. - - - - -THE CLOSE RELATION OF THE PRODUCER-GAS POWER PLANT TO THE CONSERVATION 352 -OF OUR FUEL RESOURCES. - -BY ROBERT HEYWOOD FERNALD. - -[Professor of Mechanical Engineering, Case School of Applied Science.] - - -Official reports show that the coal placed on the market amounts -annually to between 450,000,000 and 500,000,000 short tons in the -United States alone. These figures, however, are somewhat misleading -as they do not in any way show the tremendous wastes that are going on -due to our present methods of mining and restrictions in qualities of -coal that can be transported and placed on the market at a reasonable -profit. Careful investigation has shown that the coal wasted or left -in the mines in such form as to be inaccessible to future generations -amounts each year to practically 100 per cent of that placed on the -market, or in other words, at the present time some 450,000,000 tons -are annually lost as far as commercial value is concerned. - -If this condition is allowed to continue it is estimated by the United -States Geological Survey that our available supply of bituminous coal -will be exhausted within the next two hundred years. - -A realization of the seriousness of this situation has led to a -careful and systematic study of the present lack of efficiency in the -utilization of fuels for both power and metallurgical purposes, to -investigations into more efficient use of the present marketable -grades of fuel, and to a consideration of methods of using the -so-called low-grade fuels, lignites and peats. - -The United States Geological Survey has for several years been -investigating the economic value of coals and lignites as gas-producer -fuel. This work, begun with tests of coal and lignite at the 353 -coal-testing plant erected at the Louisiana Purchase Exposition, St. -Louis, Mo., in 1904, was continued at St. Louis and at Norfolk, Va., -and is now being carried on by the Survey at the fuel-testing plant in -Pittsburg, Pa. The tests were undertaken because it was evidently -desirable to determine the value of the gas producer as a means of -increasing efficiency in the use of the coal supplies of the United -States. The early tests proved decidedly encouraging, demonstrating -that many coals now wasted or not mined because they are not -satisfactory fuel for steam-power plants can, by conversion into -producer-gas, be made to do from two to three times as much work as -can be done by the best grades of steam coal burned in a boiler plant. -In consequence, the making of producer-gas tests and the study of the -processes that take place within the gas producer now form an -essential part of the fuel investigations conducted at the Pittsburg -plant under the provisions made by Congress for the analyzing and -testing of mineral fuels. - - -Rapid Development of the Gas Engine. - -It was not until late in the nineteenth century that the gas engine -came into common use, and although many types have been devised within -the last twenty or thirty years it is only within eight or nine years -that large gas engines have been constructed. This development started -eleven or twelve years ago in Germany, Belgium, and England, but -marked progress has been limited to the last eight years. - -For a long time the natural fuel of these internal-combustion engines -was city gas, but this was too expensive except for engines of small -capacity. It was seldom found economical to operate units of more than -75 horsepower with this fuel. Cheap gas was essential for the -development of the gas engine, but the early attempts to produce cheap -gas were somewhat discouraging, and for a time it seemed very 354 -unlikely that the gas engine would encroach to any extent on the field -occupied by the steam engine. The theoretical possibilities of the -internal-combustion engine operating with cheap fuel promised so much, -however, that the practical difficulties were rapidly overcome, with -the result that the internal-combustion engine has become a serious -rival of the steam engine in many of its applications. - -The development of the large gas engine within the last few years has -been exceedingly rapid. It was only ten years ago that a -600-horsepower engine exhibited at the Paris Exposition was regarded -as a wonder, but today four-cycle, twin-tandem, double-acting engines -of 2,000 to 3,500 horsepower can be found in nearly all up-to-date -steel plants, and there are installations in this country containing -several units rated at 5,400 horsepower each. - - -Development of the Gas Producer for Power Purposes. - -The rapid advance of the large gas engine was made possible by -improvements in the production of cheap gas directly from fuel by -means of the gas producer. An early form of producer introduced in -Europe, and now in general use both abroad and in the United States, -is known as the suction producer, a name suggested by the fact that -the engine develops its charge of gas in the producer by means of its -own suction stroke. Although many producers of this type are now used, -most of them are small, seldom exceeding 200 horsepower. A serious -limitation to the utility of the suction producer has been the fact -that, owing to the manner of generating the gas, no tarry fuels could -be used, a restriction that prevented the use of bituminous coals, -lignites, peats, and other like fuels. The fuels in most common use -for producers of this type are charcoal, coke, and anthracite coal, -although attempts are being made so to construct plants that they can -be operated with bituminous or tarry coals. - -To meet the demand for the concentration of power in large units, 355 -instead of operating a large number of separate installations of small -power capacity, the pressure producer was devised. This producer -develops its gas under a slight pressure due to the introduction of an -air and steam blast, and the gas is stored in a holder until it is -required by the engine. As the gas may thus be stored before passing -to the engine, and as its generation does not depend on the suction -stroke of the engine, tar and other impurities may be removed from it -by suitable devices, and the use of bituminous coal, lignite, and peat -thus permitted. - -The pressure producer was closely followed in the course of -development by the down-draft producer, which fixes the tar as a -permanent gas and therefore completely uses the volatile hydrocarbons -in bituminous coal, lignite, and peat. - -A few scattered producer-gas plants were installed for power purposes -in the United States before 1900, but the application of this type of -power in any general sense has been developed since that date. During -the first few years of this period of development anthracite coal, -coke, and charcoal were used almost exclusively, although occasionally -pressure and down-draft plants ventured to use a well-tried bituminous -coal known to be especially free from sulphur and caking difficulties -and low in both ash and tar making compounds. The rapid development of -the anthracite plant was to be expected, but it remained for the -United States Geological Survey in its testing plants at St. Louis and -Norfolk to demonstrate the possibility of using in such plants -practically all grades of fuel of any commercial value, without -reference to the amount of sulphur or tarry matter which they contain. -Figures 1 and 2 illustrate the very rapid increase in the number of -installations and in the total horsepower of the plants operating with -bituminous coal and lignite since the beginning of these 356 -investigations by the Geological Survey in 1904. - -Owing to the fact that the dates of installation of many plants are -not ascertainable, it is impossible to present the exact growth either -in number of installations or in horsepower. The relative rate is, -however, approximately shown by Figures 1 and 2, the data for which -were secured from 375 installations. The points for the year 1909 are -estimated from the returns for the first five months. These points -have been checked by two or three methods and indicate only the normal -increase established by the rate of development before the business -depression of 1908. It is probable that the actual figures for the -entire year may exceed those indicated. - - -Relative Results of Steam and Producer-Gas Tests. - -In considering the relation between the economic results of plants of -the two types under discussion, namely steam and producer-gas, the -fact should be remembered that today, in the ordinary manufacturing -plant operated by steam power, less than 5 per cent of the total -energy in the fuel consumed is available for useful work at the -machine. - -In this connection it is of interest and value to glance at the -possibilities of the best-designed and most skilfully operated -commercial plant now in use. The data concerning the steam plant -selected for this determination are derived from a table prepared by -Mr. Stott, superintendent of motive power, Interborough Rapid Transit -Company, New York City, which, as Mr. Stott says, shows “the losses -found in a year’s operation of what is probably one of the most -efficient plants in existence today, and, therefore, typical of the -present state of the art.” - -[Illustration: Figure 1.--Annual increase in number of producer-gas 357 -power plants in the United States.] - -[Illustration: Figure 2.--Annual increase in the total horsepower of 358 -producer-gas power plants in the United States.] - - -Average losses in steam plant of the Interborough Company in 359 -converting 1 pound of coal, containing 12,500 British thermal units, -into electricity. - - ======================================+==========+========== - | British | - | thermal | Per cent. - | units. | - --------------------------------------+----------+---------- - Loss by friction | 138 | 1.1 - Loss in exhaust | 7,513 | 60.1 - Loss in pipes and auxiliaries | 275 | 2.2 - Loss in boiler | 1,000 | 8.0 - Loss in stack | 1,987 | 15.9 - Loss in ashes | 300 | 2.4 - +----------+---------- - Total losses | 11,213 | 89.7 - Energy utilized | 1,287 | 10.3 - +----------+---------- - | 12,500 | 100.0 - --------------------------------------+----------+---------- - -Mr. Stott further presents a table showing the thermal efficiency of -producer-gas plants, concerning which he says: - -The following heat balance is believed to represent the best results -obtained in Europe and the United States up to date in the formation -and utilization of producer gas. - - -Average losses in a producer-gas plant in the conversion of 1 pound of -coal, containing 12,500 British thermal units, into electricity. - - ======================================+==========+========== - | British | - | thermal | Per cent. - | units. | - --------------------------------------+----------+---------- - Loss in gas producer and auxiliaries | 2,500 | 20.0 - Loss in cooling water in jackets | 2,375 | 19.0 - Loss in exhaust gases | 3,750 | 30.0 - Loss in engine friction | 813 | 6.5 - Loss in electric generator | 62 | .5 - +----------+---------- - Total losses | 9,500 | 76.0 - Converted into electric energy | 3,000 | 24.0 - +----------+---------- - | 12,500 | 100.0 - --------------------------------------+----------+---------- - -The thermal efficiency of such plants, as given by different writers, -runs as high as 33, 36, and 38.5 per cent, and for some plants figures -as extravagant as “above 40” are boldly published. Although the -present aim has been to give the figures for a producer-gas plant that -may compare favorably with those of the steam plant of the -Interborough Company, an effort has been made to keep well within -obtainable efficiencies. Attention is also directed to the fact that 360 -the producer-gas plant considered should be large enough to compare -favorably with the steam plant. This precludes comparisons with -suction plants, which are relatively small but give higher -proportional efficiencies than the larger pressure and down-draft -plants, for these require more or less auxiliary apparatus. - -Mr. Stott seems ready to accept a thermal efficiency of 24 per cent -for the best producer-gas plants for comparison with 10.3 per cent -efficiency for his steam plant, but a careful study of the problem has -led to a more conservative estimate for the producer-gas plant, -namely, 21.5 per cent. - -The tables just given show the comparative efficiencies reached in -plants of the best type, both steam and producer-gas, but these are -seldom realized in common practice. The results obtained in the -government plant at St. Louis are probably more nearly representative -of the ordinary type of apparatus. These results are as follows: - - -Relative economies of steam and gas power plants at St Louis in the -conversion of 1 pound of coal, containing 12,500 British thermal -units, into electricity. - - ==================================+====================+==================== - | Steam Power. | Gas Power. - +---------+----------+---------+---------- - | British | | British | - | thermal | Per cent.| thermal | Per cent. - | units. | | units. | - ----------------------------------+---------+----------+---------+---------- - Losses in exhaust, friction, etc. | 11,892 | 95.14 | 10,812 | 86.5 - Converted into electric energy | 608 | 4.86 | 1,688 | 13.5 - +--------------------+---------+---------- - | 12,500 | 100.00 | 12,500 | 100.0 - ----------------------------------+---------+----------+---------+---------- - -The ratios of the total fuel per brake-horsepower hour required by the -steam plant and producer-gas plant, under full load, not counting -stand-by losses, are presented below as derived from 75 coals, 6 -lignites, and 1 peat (Florida). - -The curves in Figure 3 show graphically the great economy secured with -the producer-gas plant. The figures for the producer-gas tests 361 -include not only the coal consumed in the gas producer, but also the -coal used in the auxiliary boiler for generating the steam necessary -for the pressure blast--that is, the figures given include the total -coal required by the producer-gas plant. - - - Ratios of fuel used in steam and gas plants. - - Average ratio, coal as fired per brake-horsepower hour under - boiler to coal as fired per brake-horsepower hour in producer 2.7 - - Maximum ratio, coal as fired per brake-horsepower hour under - boiler to coal as fired per brake-horsepower hour in producer 3.7 - - Minimum ratio, coal as fired per brake-horsepower hour under - boiler to coal as fired per brake-horsepower hour in producer 1.8 - - Average ratio, lignite and subbituminous coal as fired per - brake-horsepower hour under boiler to lignite as fired per - brake-horsepower hour in producer 2.7 - - Maximum ratio, lignite and subbituminous coal as fired per - brake-horsepower hour under boiler to lignite as fired per - brake-horsepower hour in producer 2.9 - - Minimum ratio, lignite and subbituminous coal as fired per - brake-horsepower hour under boiler to lignite as fired per - brake-horsepower hour in producer 2.2 - - Average ratio, peat as fired per brake-horsepower hour under - boiler to peat as fired per brake-horsepower hour in producer 2.3 - -In considering the possible increase in efficiency of the steam tests -with a compound engine, as compared with the simple engine used, the -fact should not be overlooked that a corresponding increase in the -efficiency of the producer-gas tests may be brought about under -corresponding favorable conditions. Not only is the producer passing -through a transitional period, but the gas engine must still be -regarded in the same light. In the larger sizes the vertical -single-acting engine is being replaced by the horizontal double-acting -engine. Other changes and improvements are constantly being made which -tend to increase the efficiency of the gas engine, as compounding and -tripling the expansions have already increased the efficiency of the -steam engine. - -As has already been stated, the gas engine used in the tests here -reported is of a type that is rapidly becoming obsolete for this size, -namely, the vertical, three-cylinder, single-acting. - -A brief consideration of these points will lead at once to the 362 -conclusions that a comparison of the producer-gas plant and steam -plant used in these tests is very favorable to the former, and that -any increase in efficiency in the steam tests that might result from -using a compound engine can be offset by the introduction of a gas -engine of more modern type and a producer plant designed to handle the -special kinds of fuel used. - -[Illustration: Figure 3.--Comparative service of coals and lignites in -gas-producer and steam-boiler plants.] - -It should be noted that many fuels which give poor results under steam -boilers have been used with great ease and efficiency in the gas -producer, which thus makes it possible to utilize low-grade coals and -lignites that have heretofore been regarded as practically useless. 363 -Several of the poorest grades of bituminous coals have shown -remarkable efficiency in the gas producer, and lignites and peat have -been used with great facility, thus opening the way to the -introduction of cheap power into large districts that have thus far -been commercially unimportant owing to lack of industrial -opportunities. Experiments with “bone,” a refuse product in -bituminous-coal mining, have given excellent results, showing an -efficiency in the producer equal to that reached by good steam coal -under boilers. Recent investigations with other low-grade fuels, such -as mine roof slabs, culm, and washery refuse, have also demonstrated -the possibility of using such material to advantage in the producer -under proper commercial conditions. - - -Number and Class of Plants. - -A list of producer-gas power plants recently secured indicates that at -present there are over 500 such plants in operation in the United States, -ranging in size from 15 to 6,000 horsepower. - -Figure 4.--Summarized data of producer-gas power plants in United -States. - -=========================+=======+==================================+ - | | Horsepower. | - |No. of | | - |plants.| | - | +-------+--------+--------+--------+ - | | Total.|Average.|Minimum.|Maximum.| - | | | | | | --------------------------+-------+-------+--------+--------+--------+ -Anthracite coal: | | | | | | - Over 500 horsepower | 8 | 7,550| 950 | 600 | 1,500 | - 500 horsepower or less | 407 | 40,550| 100 | 15 | 500 | - +-------+-------+--------+--------+--------+ - | 415 | 48,100| 116 | 15 | 1,500 | - +=======+=======+========+========+========+ -Bituminous coal: | | | | | | - Over 500 horsepower | 20 | 49,000| 2,450 | 750 | 6,000 | - 500 horsepower or less | 17 | 5,150| 300 | 35 | 500 | - +-------+-------+--------+--------+--------+ - | 37 | 54,150| 1,460 | 35 | 6,000 | - +=======+=======+========+========+========+ -Lignite: | | | | | | - Over 500 horsepower | 3 | 7,275| 2,430 | 525 | 3,750 | - 500 horsepower or less | 19 | 1,725| 90 | 25 | 250 | - +-------+-------+--------+--------+--------+ - | 22 | 9,000| 410 | 25 | 3,750 | - +=======+=======+========+========+========+ -All plants | 474 |111,250| 235 | 15 | 6,000 | --------------------------+-------+-------+--------+--------+--------+ -=========================+=======+======= - | | Per - | Per | cent - | cent | of - | of | total - | total | horse- - |number.| power. --------------------------+-------+------- -Anthracite coal: | | - Over 500 horsepower | ... | ... - 500 horsepower or less | ... | ... - +-------+------- - | 88 | 43 - +=======+======= -Bituminous coal: | | - Over 500 horsepower | ... | ... - 500 horsepower or less | ... | ... - +-------+------- - | 8 | 49 - +=======+======= -Lignite: | | - Over 500 horsepower | ... | ... - 500 horsepower or less | ... | ... - +-------+------- - | 4 | 8 - +=======+======= -All plants | 100 | 100 --------------------------+-------+------- - -Data secured from this list are summarized in the table on the 364 -previous page according to the type of fuel used, and separately for -all plants above 500 horsepower and for those not exceeding 500 -horsepower. - -It will be observed from this table that about 88 per cent of the -total number of installations in this country are operating on -anthracite coal (a few using charcoal or coke), and that bituminous -coal and lignite are used in the remaining 12 per cent. Of the total -horsepower approximately 57 per cent is derived from bituminous coal -and lignite and 43 per cent from anthracite coal, charcoal, and coke. -In point of size it will be noted that the bituminous plants average -12½ times the size of the anthracite plants. - -In 1906 a large number of these plants were carefully inspected in -order to secure definite information from the owners and operators -regarding the more or less successful operation of such installations. -Similar inspections were made in 1908. - - -Deductions from Visits of Inspection. - -The deductions made from the visits in 1906 were as follows: - -1. The plants as a whole are giving remarkable satisfaction -considering the very brief period of development that has passed since -the introduction of this type of power. - -2. The most serious difficulty seems to arise from the lack of -competent operators to run the plants rather than from defects or -troubles in the plants themselves. - -3. Incompetent salesmen are undoubtedly to blame for serious -misrepresentations and misunderstandings. - -4. The neglect shown by some manufacturers in respect to their plants -after they are installed and paid for has not been farsighted, and the -failure of the manufacturers to give the purchasers or operators of 365 -plants full information regarding their construction and method of -operating has certainly been detrimental to the business. - -At the present time (1910) the following modifications might be -advantageously made to the above statements: - -1. Unchanged. - -2. This situation still prevails, although there are many more -competent operators today than three years ago. Time will eliminate -this difficulty. - -3. With stronger companies this situation is greatly improved. - -4. Experience has shown that such neglect produces serious troubles -and financial loss to the manufacturer, and a very decided change for -the better has developed in the last few years. There are, however, a -few small concerns still operating in the producer field on what may -be considered a false basis. - - -Centralization of Power Development and Distribution. - -Central stations for power and lighting are springing up all over the -country. Electric lights are now in general use in towns numbering -their population by hundreds only. Electric transmission for -street-railway service is practically universal and electric power for -shop drive is in great demand. The substitution of the electric -locomotive for the steam locomotive for terminal service and even for -line duty by several leading railway systems is no longer a mere -expectation but is an every-day working reality. - -These changes and developments in every section are, to a large -extent, tending to do away with the individual small steam equipment, -whether stationary or locomotive, and are bringing to the front the -central power station, ranging in size from lighting and pumping -plants of less than 100 horsepower in the smaller towns to those of -100,000 horsepower or more required to meet metropolitan demands. 366 - - -European Examples of Advantageous Location. - -In the development of central power plants and the reduction of the -cost of power, the producer-gas power plant is an important factor. In -this connection the question of locating such plants directly at the -mines is well worth careful and unbiased attention in the engineering -profession. The advantages to be derived from such a location have -already attracted the commercial interests of Europe. As examples -worthy of thoughtful consideration, the general conditions of -operation of three typical European installations are here described: - -Plant A.--This plant, although not situated directly at the mines, is -but a short distance away, and the company owning the plant also owns -the mines from which the fuel is secured. The plant is of the Mond -by-product type and consists of eight pressure producers of 2,500 -horsepower each. The fuel used is a run-of-mine bituminous coal said -to contain 8 to 9 per cent ash and 1 to 2 per cent sulphur. This would -indicate that they are utilizing the best grades of coal from their -own mine in the local gas plant and allowing the lower grades to -remain unmined, a fact which I verified before leaving the plant. - -The plant is designed for the recovery of the sulphate of ammonia and -for supplying gas to the neighboring towns for both metallurgical and -power purposes. As one unit is always held in reserve, the plant is -called 16,000 horsepower. The main distributing line is 3 feet in -diameter, and at the time of my visit there were 37 miles of main, the -longest single run being 6½ miles. Each producer gasifies, on an -average, 20 tons of coal per twenty-four hours. The report of the -engineer in charge indicates that the plant had been in operation -twenty-four hours a day, seven days a week, for two and one-half 367 -years without a shut down. - -Plant B.--This plant, which is located in the center of a peat bog, -proved of especial interest. It has a capacity of 300 horsepower only, -and is about 3 miles from the town to which the electric current is -supplied. One-half of the plant (150 horsepower) was installed in 1904 -and the remainder in 1906. This is probably the first as well as the -smallest producer-gas installation to be located at the mine and -transmit high-voltage current to a point some distance away. This -installation, in 1909, consisted of two suction producers (special -peat type) rated at 150 horsepower each, and two horizontal twin -single-acting four-cycle gas engines of 150 horsepower each, direct -connected to alternating-current three-phase generators, which were -running splendidly in parallel at the time of my visit. The 3,000-volt -current is transmitted to the town, where it is used during the day -for lighting shops and for shop motors. At night the plant supplies -the lights for the streets and residences. The charge for residence -light is 9 cents per kilowatt hour. Both units are in operation from -5:30 a. m. to 6 p. m., and one continues to 11 p. m. each day. - -A 35-horsepower peat machine is used for preparing the fuel. This is -driven by an electric motor supplied with current from the power plant -on the bog. As only 750 tons of dry peat are required per year there -is no attempt to work the plant to its maximum. Local farmers are -employed and they work as little or as much as they please, as there -is no difficulty in getting out all the peat needed for a year during -the working season, which in this locality is from April 15 to -September 1. As a result 14 men are employed more or less of their -time. They receive about 50 cents per day each and get out about 20 -tons of peat per day. - -Coal at this point in Europe costs $3.75 per ton. The dry peat 368 -delivered on the operating platform of the producer plant costs only -80 cents per ton. - -Plant C.--This plant is installed at the collieries. At the time of my -visit it was under full operation, using roof slabs that gave little -indication, on casual inspection, of containing any combustible -material. It was claimed that this fuel averaged over 60 per cent -ash--a claim which seemed entirely reasonable. At the time of this -visit (1908) the producers were not only supplying a number of -furnaces with gas, but were also operating a 1,000-horsepower and a -250-horsepower gas engine. A 500-horsepower engine was being added to -the equipment. The engines in use were direct connected to electric -generators. The 10,000-volt current is used for operating the local -mine machinery and also for furnishing lights for neighboring towns -and power for a street railroad. The plant was reported to be using -over 100 tons of this low-grade fuel per day. - - -Favorable Conditions in the United States. - -In the United States cheaper power is constantly sought. The -water-power possibilities of the country are being realized and the -hydro-electric power plant is a wholesome cause of competition. The -supply of fuel of marketable grades is not unlimited. Prices for such -fuel must necessarily increase. The cost of transporting coal from the -mines is high, and the possibility of obtaining a sufficient supply of -cars to handle low-grade fuels is questionable. The power demands of -the country are increasing, and this power must be developed at a -reasonable cost. The time is approaching when the cheapest fuel -obtainable must be used to the best economic advantage in order to -develop power at a unit cost consistent with commercial progress. - -Consideration of the conditions indicates that in order to keep the 369 -price of power developed from fuel down to a consistent figure-- - -(a) Grades of fuel which warrant transportation, or which may be -defined as “marketable,” should be used with the greatest possible -practicable economy. - -(b) The very large percentage of coal of so-called low grade which -today is left at or in the mine must be utilized. - -(c) Advantage must be taken of the large deposits of lignite and peat -which are found in many sections of the country. - -It is undoubtedly true that in general, under conditions which do not -require the use of steam for other than power purposes, the -producer-gas power plant meets the requirements of (a). - -At present the only method of advantageously handling the fuels -mentioned in (b) and (c) is in the gas producer, and the utilization -of these lower grades of fuel on an extensive scale demands -concentration of the power plants within close proximity to the fuel -supply. - -The logical conclusion from a careful study of the producer-gas power -situation is that the time is not distant when financial interests in -power production will be directed toward the centralization of the -producer-gas power plant at the mines and the distribution of the -energy developed either by high-voltage long-distance electrical -transmission or by pipe systems for conveying the gas. - - - - -EFFICIENCY IN SHOP OPERATIONS. 370 - -BY H. F. STIMPSON. - -[Consulting Efficiency Engineer, New York. Published in The Iron Age, -Jan. 6, 1910, and reproduced by special arrangement.] - - -Managers of industrial enterprises will undoubtedly agree that there -are few qualities which are more to be desired in equipment, methods -and men than that of efficiency. From an extensive study of this -subject in various parts of the country, together with interviews and -correspondence with several hundred concerns, the writer has become -convinced that there is a general lack of definite comprehension of -what efficiency is, whence it springs, how it may be measured and -developed and the results which its cultivation will produce. The -object of this monograph is an endeavor to throw some light upon these -things and to afford a new viewpoint from which to study industrial -operations. - - -The Evolution of Industrial Management. - -In the first place we must realize that the management of industrial -enterprises is in a state of evolution. The tremendous growth of the -past few years has caused certain previously satisfactory methods to -become inadequate to present needs. Many details which in the days of -smaller affairs could be absorbed by personal inspection and mentally -stored for use when needed must now, because of their very volume, be -made matters of record. - -The character of these records has much to do with their value. -Because financial records are so ancient they have exerted an undue -influence upon the character of all other records. While under our -present civilization, the ultimate object of industrial operations is -to create financial profits, there are many highly important records -which cannot be adequately expressed in terms of money. The business 371 -of manufacturing consists of a repetition of mechanical operations. -Mechanical operations necessarily involve considerations of weight, -distance, time and effort, but not of money. - -The reason for the failure of so many cost systems to serve the -desired end is that they are based upon a wrong unit. These systems -become useful only beyond a certain point. Other systems have been the -result of a blind craving for aid, but being without broad underlying -principles and not properly tied together and simply, in many cases, -disjointed attempts to improve isolated details, they too have failed. -The result is that attempts by specialists to improve industrial -conditions have been often looked upon with suspicion and this is not -altogether without reason. These very failures, however, have drawn -the attention of men in certain lines of engineering to the rapidly -developing needs of manufacturers. They have attempted to solve the -problems by the use of engineering instead of by accounting methods, -and the results which have been attained prove conclusively that a -material advance has been made. - - -What Is Efficiency? - -With this understanding of the present conditions, let us consider -what efficiency really is. It has been defined as “the ability to -produce certain results,” and this at the very outset necessitates the -existence or creation of a standard of measurement. Our perception of -efficiency, therefore, is correct only in proportion to the precision -of the standard, which must be accurately developed from data which -are not only exact, but complete. A machinist, believed to be -operating at high efficiency, was observed while turning a shaft. His -cut, feed and speed seemed to be beyond criticism. When the shaft was -finished, however, he had to spend half as much time in hunting up a -chain and pad to remove the shaft from the lathe, as he had taken in 372 -turning it. This cut his actual efficiency from 100 per cent down to -87 per cent, yet the man was not at fault. His normal work was to -operate a lathe and not to hunt for things which should have been -provided for him. The points to be observed here are not only the -importance of using the right standard of measurement, but that the -efficiency of the man depended very largely upon his surrounding -conditions over which he had no control. These conditions depend upon -the efficiency of the management in securing proper equipment from the -owners. This in turn depends upon the efficiency of the management’s -records in enabling it to state clearly and accurately what increase -in output and consequently in profits will result from improving the -conditions--thus justifying the expenditure required. We see from this -that the true standard is not the possibility under existing -conditions, but that which can be obtained under other and more -desirable conditions. - - -Managerial Opposition to Change. - -The management, which immediately controls the records and conditions -should be the prime source of efforts towards the increase of -efficiency throughout the plant. The opposition of managers to -progress in this respect is exceedingly great, yet not altogether -surprising for these reasons: - -1. There is a widespread fallacy that so-called practical experience -in the manual operations or technical processes of a business is the -chief essential to success in its management. This is due to the fact -that perfection of workmanship, of which he knows much, is more -important in the eyes of the artisan than the actual cost of the -operation, of which he knows little, or than the cause of this cost, -of which he knows less. - -2. It is only recently that educational institutions have afforded 373 -any opportunity for adequate instruction in the art of management, -pure and simple, a principal feature of which is the intelligent -regulation of cost. - -3. There has been, and now is, as a result of these two things, a -failure to appreciate the necessity and value of exact data, in proper -terms, of refined and scientific methods of collecting and using it -and of logical reasoning in the solution of industrial problems. - -The highest degree of efficiency, therefore, is only to be realized in -a shop where executive methods have reached a high stage of -efficiency, for in these is unquestionably its source. - - -Time Measurement Important. - -The first step is to recognize the necessity and value of a proper -measurement of time, as a guide not only to the executive but to the -workman. A man was observed during 8 successive repetitions of the -operation of making a machine mold in a foundry. The unit times varied -5.2 to 23.6 minutes, the total time for the eight being 104 minutes. -Under the method of timekeeping in use at that shop it was only -ascertained that the eight operations took 1¾ hours or an “average” of -13 minutes each, and the labor cost and distribution of burden were -made on that basis. Because of the absence of any standard time -whatsoever it was not realized that had the man done each of the eight -in 5.2 minutes, they would have been completed in 41.6 minutes, -resulting in a saving of over 60 per cent of the total time. Had the -man received a proper work ticket bearing this standard time, before -he began the work, there is no doubt that he could have easily -performed the work in the shorter time and a marked difference in -proportionate burden and cost would have resulted. Under the existing -methods the management could not know of the waste, and so was -helpless to prevent or cure it. - -Every item of time, therefore, is capable of division into two parts: 374 -A standard or necessary time and a (more or less) preventable waste, -which latter is the easier thing of the two to determine. - - -An Example of Increased Efficiency in Riveting. - -A gang of four were engaged in riveting some steel plates. By the use -of a stop-watch it was found that a large proportion of the total time -of the riveter and bucker-up was not utilized; yet some one was always -at work. The reason was that the men proceeded along the work in such -a way that the bucker-up covered with his body the holes as yet -unfilled by rivets, he moving from left to right. When, therefore, a -rivet was driven, these two men had to stand aside until another rivet -was placed by the rivet passer. Upon the instruction of the engineer, -they reversed the direction of their movements so as to cover only the -filled holes, thus enabling the passer always to have a rivet ready -for them and making their speed in driving the real gauge of the speed -of the operation. Furthermore, when they encountered a hole that -needed reaming (as was sometimes the case, until the fault was located -with the fitters and remedied), the riveter would lay down the gun, -pick up the reamer, ream the hole, lay down the reamer, pick up the -gun and drive the rivet. When persuaded to test consecutively ten or -more holes after driving the first rivet in a seam to anchor the -plates and then to drive the ten consecutively, they progressed faster -with less effort. These men, receiving not only a standard from the -engineer, but kindly instruction as to how to attain it, and being -stimulated, not by abuse, but by a scientifically determined -bonus--increased their output over 150 per cent beyond the original -amount. - -In this plant, by the use of these methods, and in about seven months, -the general increase in efficiency of the men was such that the force -was reduced 67 per cent without reduction in volume of output, but 375 -with a great reduction in net total unit cost, even after paying the -bonus alluded to and the cost of the expert services which alone -produced this result. - - -The Use of Bonuses. - -It is proper to say a word here on the subject of bonus as a means of -increasing efficiency. The principal merit of this motive lies in the -fact that immediate personal gain is the strongest incentive to -immediate personal effort. It operates just as strongly on the employe -as on the employer. Hope of promotion is too vague and the actual -chances too limited to exert much pressure, but an extra sum in the -pay envelope--or better still, in a separate one--for the disposal of -the “old man himself,” will do wonders. To be most effectual a bonus -must not begin at the point of standard efficiency, but at the point -when average efficiency ceases and extra effort begins; and it should -increase on a curve faster and faster as the point of standard -efficiency is neared, because the accompanying effort will be -correspondingly greater. - - -Efficiency Methods and Department Heads. - -So much for the individual operator. And now for the executives. From -foreman up to and including the highest official the same methods can -and should be applied. Under ordinary circumstances, the workman in -need of material, tools or instruction keeps his skirts clear by a -more or less indefinite and unintelligible request to the foreman. He -thinks it the foreman’s duty to look after him, but that if he does -not do so it’s no business of his. Put that man on standard time and -bonus and if there is anything he thinks the foreman should do or get -for him he speaks loudly and directly. This the foreman does not -resent--as would ordinarily be the case--for his efficiency is -determined by the combined efficiency of his men and upon this his 376 -bonus depends. Anything, therefore, that interferes with the progress -of the men touches him closely, and he will move heaven and earth to -eliminate it. All kinds of defects which were previously hidden from -the superintendent are now brought to his attention, and he welcomes -them for exactly the same reason that actuated the foreman. Thus the -change that comes over a shop when efficiency is accurately measured -and adequately rewarded is often astounding. - -But this is not all. The possession of exact data as to standard and -actual times makes possible a certain great improvement in, and -addition to, the executive staff and a material increase in the -efficiency of the foreman and department heads. By this is meant the -installation of a planning department, by which the apportionment of -the time of men and machines is controlled. The advantage, indeed, the -positive necessity, of the services of engineers and draughtsmen in -apportioning the different parts of the product is well understood. -The requirements of each part, the strains to which it will be -subjected, the kind, quality and quantity of material required to -resist these strains, the shapes of the pieces, their relations to -each other and many other things are all given most careful attention. -The value of fully constructing the design on paper, as a means of -discovering possible errors or difficulties, and of correcting or -overcoming them before large expense for material and workmanship has -been incurred, are too well realized to need more than a simple -statement for their acceptance. No sane executive would expect his -department heads to take a copy of his customer’s order and -individually work out the details with which they are particularly -concerned and expect the parts to fit. Yet this is just exactly what -is being done as regards the apportionment of productive time; and a -tumult of broken promises of delivery, excessive cost of production, -enormous wastes of time in changing jobs, etc., is the immediate 377 -and unavoidable result. - - -What Can Be Done. - -It is perfectly possible, but only to one trained in the particular -art, to schedule the different operations on all of the different -parts of the product; to plot the productive times required, so that -each may begin at such a time in relation to the others that all will -arrive at the point of assembly at the proper time and in the proper -sequence; to combine these studies of the different productive orders -on a chart which will show the disposition to be made of all the men -and machinery; to prepare advance programs for each man and machine -engaged in productive labor; and thus to give to the superintendent -and foremen the advantage of the same predisposition of time that they -now have of material. - -As it is now, the time of these persons is entirely too much occupied -with this problem of the disposition of time for which they are only -partly equipped, having, it is true, much of the necessary -information, but no training in the scientific handling of it. They -are, therefore, unable to devote the time they should to the immediate -study of the operations and the provision of tools, material and -instruction to the men. They try to be all over the shop at once and -they depend on getting their information at first hand, and -consequently fail more or less clearly to cover the ground. Having -such schedules and programs as are above described, and with the -proper work tickets distributed on a dispatching board, each one in -the division representing the work upon which a man or machine is -engaged, having the time of commencement and the standard time -thereon, the foreman can see at a glance without leaving his office -what men will shortly finish their work and what steps must be taken -to see that the drawings, tools and materials for their next work are -ready for them in time. Having seen to this he has some leisure to 378 -give his attention to matters immediately requiring it, knowing, if -anything is obstructing the other men, that their anxiety to earn -their bonus will cause them promptly to bring such matters to his -attention. Having this schedule, moreover, the foremen are enabled to -order material, etc., ahead and to do so intelligently, thus making -the work of the shop transportation department much simpler. In one -case by this means 25 men were able to handle the intra-shop -transportation in a more satisfactory manner than 75 men had -previously been able to do. - -The planning department also greatly aids and is in turn aided by the -purchasing department, for the times when material must or can be got -can intelligently be determined to their mutual advantage. The sales -department, too, when it once gets the idea that the shop is not -working miracles, but has its limitations, can make delivery promises -which really mean something and can be kept, and this is a trump card -of no small importance when the fact becomes realized among the -customers of the concern. - - -Responsibility of the Management. - -In the opinion of those whose opportunities have enabled them to get -at the facts, the inefficiency in manufacturing, which undoubtedly -generally exists today, in spite of the prevailing impression to the -contrary, is only about one-fourth due to the things over which the -employes have control and three-fourths to conditions imposed upon -them by the management. The methods outlined above have achieved -results whenever they have been faithfully and honestly tried, with -proper co-operation by the management and under the direction of -skilled specialists, and the results have continued and will continue -as long as the methods are followed. The effect upon the men is that -from being often listless, indifferent and antagonistic, they become 379 -energetic, ambitious and loyal friends. - -One thing more: Much has been done and overdone in the line of -so-called welfare work. It is a highly creditable and necessary line -of effort, when confined to attempts to remove from the path of the -employe any obstacle which prevents him from developing his skill and -efficiency to the highest degree. An uncomfortable, unhappy person -cannot be efficient. But as steam is necessary to the engine, so is -incentive necessary to the worker to get him to make the best use of -the facilities provided for him. Under our present civilization, the -same incentive which pushes on the master will push on the man, and -that is direct personal gain in dollars and cents, not for itself, but -for and what that gain will bring. It must come to him quickly after -the exertion which its expectation calls forth, for if long delayed, -the effect is lost. It must also come to him separately from his -regular wage that its amount may be the more readily realized. - -Moreover, the results of efficiency methods, within the writer’s -knowledge, are sufficient to convince him that their general adoption -would so increase the purchasing power of the employe, by increasing -his wages and decreasing the cost production, as to have a markedly -beneficial and steadying effect upon the business of the country. - -Efficiency methods, however, cannot be successfully designed or -installed by those trained in other lines and prejudiced by other -associations. After these methods have been scientifically developed -to suit the existing conditions and actually put into operation by -those skilled in the art, they may gradually be relinquished into the -control of those who have been educated in the process of -installation, with some hope of success for their future operation. - - - - -THE BRIDGE BETWEEN LABOR AND CAPITAL. 380 - -BY JOHN MITCHELL. - -[Former President United Mine Workers of America.] - - -If the interests of labor and capital were identical--as some -contend--there would be no chasm between them to bridge; and if the -interests of labor and capital were irreconcilable--as others -contend--any effort to unite them would be futile. From an experience -extending over a considerable period, I am quite convinced that -neither of the foregoing propositions will stand the test of close -analysis. My judgment is that the interests of labor and capital, -though divergent in some respects, are nevertheless reciprocal and -inter-dependent. - -To elucidate in a practical way the subject of the proper relationship -between employer and employe, it is necessary to review the activities -of these two factors in the field in which their interests are common -and to mark the point at which they diverge. The employer and the -employe are mutually interested in the successful conduct of industry; -the profits of the one and the wages of the other obviously are -contingent upon it, as both profits and wages must be paid from the -earnings of the enterprise in which the capital of the one and the -labor of the other are jointly invested. This being true, the workman -and the employer are equally concerned in the character of the product -which is manufactured and sold by them, just as they are interested -equally in good markets and regularity of employment. Having worked in -co-operation up to the point of turning out an article that commands a -wide and profitable sale, the question of dividing the earnings of -their joint efforts presents itself. It is the failure of the attempt -to adjust satisfactorily this controversy that gives rise to the 381 -differences between employers and workmen and is the basis of the -labor problem as we have it today. True, there are many questions of -discord apart from those of wages and profits, which result in serious -industrial conflicts, but followed back to their source, it will be -found that these issues are inseparably related to those of wages and -profits. In other words, the demand for a shorter workday, for -healthful, sanitary surroundings, has its origin in the irrepressible -desire of the working people for a progressive improvement in their -conditions of life and labor. - -In ancient and mediaeval times when the structure of society was -simple and each family consumed all the things it produced; or even at -a later period when the master and the journeyman worked together side -by side, and when the master had been a journeyman and the journeyman -expected to become a master, there was little cause for controversy, -and the problem of labor was not difficult of solution. It was not -until the invention of machinery, the advent of the factory system, -the use of steam, and the application of new processes that the -question of the relationship of employer and employed grew so complex -and impersonal that new methods became necessary in the proper -adjustment of industrial affairs. As step by step industry developed -from the stage of the privately owned factory to the firm and -corporation, to the combination and the trust, the real employer was -removed further and ever further from personal contact with his -employes. As a consequence of this transition, the salaried manager -took the place once held by the actual employer, and the simple and -friendly relations of early days gave way to the intricate and complex -industrial life of this generation. - -Coincident with the development of industry which has revolutionized -the whole life and history of our people and our civilization, have -come the local, the district, the national, and finally the -international organizations of labor. These gigantic associations 382 -and federations of workmen are the logical and the inevitable -consequence of an industrial development which threatened the -subjugation of the individual workman and forced him, in self-defense, -to merge his interests and his identity with those of his fellow -workmen. The momentous change in the status of the workman which -accompanied the revolution of industrial processes, transformed the -whole problem of labor from the question of production to that of -distribution, and it is the effort to find an equitable adjustment of -the problem of distribution that is taxing to the utmost the ingenuity -of economists, philosophers, and statesmen. - -In the search for a panacea to heal the industrial ills against which -society so justly complains, many suggestions are made and innumerable -remedies proposed. On the one hand are found forces that would deny to -labor the right of organization and combination, although exercising -and enjoying the benefit of these rights themselves; on the other hand -are forces at work advocating and demanding the abolition of the whole -competitive system; between these extremes stands a great army of -workmen and employers earnestly striving to find grounds of mutual -agreement upon which the rights and obligations of each may be defined -and brought into harmony. With all due respect to the opinions of -others, I submit that the path of safety, progress, and justice lies -in the middle course--in the recognition of the right of organization -on the part of both labor and capital, by which and through which -these factors in our industrial progress may work out their inevitable -destiny, contracting freely each with the other upon all questions of -mutual concern. - -The trade agreement is the bridge between labor and capital. It -restores, so far as it is possible to do so, the personal -relationship, the mutual interest which existed prior to the advent of -the factory system. It is an acknowledgment of the inter-dependence of -labor and capital, a recognition of the reciprocal interest of 383 -employer and employe. When the right of organization among workmen and -employers is fully recognized and freely conceded, and when these -forces adopt and practice the policy of collective bargaining, the day -of the strike and the lockout, of the boycott and the blacklist, with -their attendant evils, losses, and hardships, will have largely passed -away. - - - - -THE UNEMPLOYED. 384 - -BY JOHN BASCOM, D. D., LL. D. - -[Formerly President University of Wisconsin.] - - -A striking feature of the industrial world and one well fitted to -occasion alarm is the large number of persons thrown, from time to -time, out of employment. We are forced by it to accept one or other of -two conclusions; that the economic world is mismade, incapable of a -quiet and successful run, or that our handling of it has been in some -way unskillful and misapplied. This fact of unemployment has become -very conspicuous, and to those who suffer from it, and to those who -sympathize with them, exceedingly grevious. A certain portion of the -human family, and that in the most progressive nations, find -themselves superfluous, out of connection with the means of living -though others are obtaining support, comfort and luxury. They have -nothing to do but to die in their tracks. Like the feeble ones in a -forced march through an enemy’s country they first fall behind and -then perish. This state of the case does not arise by accident and -then pass away, it has periods of severity which frequently return, -and stands among those constant dangers which may at any time overtake -a few. This evil comes especially to industrious countries, like -England, and to portions of our own country, like Pittsburg, noted for -their enlarged production. The causes and remedies of this state of -things become, therefore, subjects of anxious inquiry. We may assert -that the want of employment is due in a general way, to the -deficiencies and vices of men, but this assertion does not -sufficiently point out the immediate occasion of the difficulty, nor -furnish us its remedies. - -Failure of the means of livelihood arises from indolence, ignorance, 385 -vice and unfavorable conditions on the part of those who suffer from -it, conditions often of the nature of accident. But while the -recipients of this disaster are plainly recognized, the disaster -itself comes to them in a measure independent of their failures. We -need to know not only those who are likely to suffer from a given -disease, but how the disease itself arises. The central and most -productive cause in this series of provocations is indolence; the -others accompany indolence and more or less arise from it. By -indolence we mean a want of life and hence a weakness of all the -functions of life. We may mean physical inactivity or intellectual -sluggishness or moral indifference, or may mean them all blended in -one or other of the various ways in which a weak and perverted life -manifests itself. The tramp is physically indolent, he hates work. -This indolence readily extends to intellectual activity; the indolent -person is ignorant of the value of success, of its motives and of its -means. The world reveals few incentives to him and makes few appeals. -This indolence and ignorance do not wholly arrest the wants and -desires of men, and hence vice, as in the case of the thief, enters as -the most ready and immediate means of gratification. The torpid nature -of the moral judgment lends itself to this result, and nothing but -fear, itself weak and vacillating, stands between the indolent man and -habits of gross indulgence, inconsistent with personal and with social -welfare. - -The accidents, misjudgments and disappointments which are liable to -overtake us all owe the injury which they inflict to the weak -personality on which they fall, and so misfortune seems to follow and -persecute those who are least able to bear it. The indolent, passive -mood is a good medium for the accumulation and transfer of every form -of disaster. The class of the helpless is much enlarged by this flow 386 -of every form of evil to these low places in conduct and character. - -We may clearly recognize these facts and suppose them a sufficient -explanation of the farther fact, that so many are thrown out of -employment and find themselves the waifs of society with no secure -attachment to it. They do, indeed, make conspicuous the failure of -occupation and determine the direction it will take. Their numbers are -seriously increased by it, and their very presence gives the -conditions of its recurrence. They are both causes and effects. They -stand on terms of action and reaction with all the embarrassments of -production. They help to reduce wages, and when wages are reduced, -they are the first to be driven out of employment. They are the -symptoms of the disease, the product of the disease and the means by -which it is carried farther. All failures in the productive process -extend, in their worst results, to this class of defectives. They are -the recipients of past evils, of present and of coming evils. They -arise in connection with a false form of production, must be treated -with it and removed with it. They are a composite product, their -faults not being wholly their own but in part the faults of the -economic system with which they are associated. They are not the -scapegoat on whose head the sins of the people may be laid and then be -borne into the wilderness. - -In discussing the causes and remedies of unemployment, we shall see -how far and in what way these feeblest workers are involved in it. We -cannot improve society by simply striking off the evils that have been -developed under it. Healthy growth alone can rid itself of failures. -It often happens in physical disease that what is accepted as a remedy -in the end aggravates the difficulty. - -One dislikes to use the word pauper, it so frequently carries with it -an unreasonable and cruel contempt. Yet there are paupers in the human -household, and when the temper is once present it is most difficult of -removal. It is a form of leprosy that eats out all vital power. The 387 -pauper temper indicates a disposition to secure immediate ease with no -reference to the comfort of others. It accepts any advantage that -offers without the slightest wish to return it. Yet even this spirit -may offer some excuses for itself. The evils of society which may have -originated far off in the action of the leaders of men, are apt to go -booming downward till they reach, in their most distinctive form, the -pauper class, or those but little above it. Diligence, thrift, skill, -ward off the blow and escape with only a partial loss. Those who are -always in the way of it are the weak ones, to whom prosperity brings -but little and adversity occasions immediate overthrow. When those who -at best are but partially occupied, find that labor is altogether -failing them, the question of relief becomes most difficult. There is -no profitable labor at disposal, and to provide labor means farther -loss; it is charity in its most disguised, expensive and unrequited -form. The worst lesson we can teach those already inclined to -negligence is that a form of labor may be put in the place of real -labor, and that the question of adequacy is one to be answered by -society, not by the needy, recipient of favor. Whatever we may do for -men of feeble productive power we are not to lead them still farther -on in the direction of indolence and worthlessness. Actions are not to -be separated from their normal results. We may frequently be called on -to bear the injury which proceeds from another man’s wrongs, but we -are never called on to disguise the wrong itself. A portion of the -wrong is our own; that we should correct. While the evils are in the -process of infliction we are to bear them sympathetically, but not in -a form which disguises their true character. - -Something of the same danger inheres in old-age pensions. Workmen of -usual diligence should receive a return for their labor which would -enable them to provide for age. As long as workmen, reaching the age 388 -of three score, generally become dependent on the public, it is -perfectly plain that their wages are too low, that the returns of -production are not fairly distributed. A pension acknowledges the -evil, but does not remove it, it tends rather to confirm it. That the -losses which accompany industrial accidents should be divided between -workmen, managers and the community at large is plainly just, and is -no temptation to remissness. The accident is not the fault of any one -person or class of persons. If it falls upon a large number, it is -more readily borne and increases the motives to care. Our machinery is -operated for the benefit of the entire community, and it is only fair -that the entire community should help to bear the increased dangers. -That injuries should be still left with the workmen on whom they have -accidentally fallen is another proof of the slight hold they have on -the public mind. - -Any remedy for the lack of employment which is prompted simply by -compassion and still leaves the evil to overtake the workman is not -social hygiene; is not a recognition of the partiality and -disproportion which still inhere in our productive methods. Labor -should be successful and rewardful when left to its own development. -It is bad to create a pauper temper and most difficult to contend with -it when it has once been called out. Men should be subject to their -own incentives of hope and fear, success and failure, as far as -possible. The same discipline which comes to the active, is the -natural spring of action in the sluggish. Any compassion which reduces -the motives of effort that should come to the entire community, or -which leaves the community satisfied with a maladjustment of duties, -can never provide an adequate correction of bad distribution. We are -placed between a narrow and a wide humanity, between an immediate -reduction of suffering and a removing of its conditions. The final -result is the test of our wisdom and good will. - -There are partial remedies of the failure of employment which are 389 -fitted to give relief without endangering the future or disturbing the -general conditions of employment. Occupations especially irregular, -like that of the stevedore, may receive especial attention, or may be -united to other forms of labor so as to secure greater uniformity. In -these occupations the employer may frequently have but little motive -to correct an evil from which he prospers by reduced wages. Excess and -deficiency in the various branches of work should be made, as far as -possible, to correct each other. Workmen are often not in a position -to meet successfully these evils. They accept the drift of the labor -market with small power to control it. - -Bureaus of intelligence should be established so that the variable -demands for labor of different localities may be quickly met. This is -a public service, and should have the ease and certainty of such -service. The same reasons which lead the Government to take the -direction of immigrants should lead it to render similar aid to -workmen. Workmen are often ignorant of the extent and character of the -employment offered in the distance, and are subject to the exactions -which arise in connection with this want of knowledge. The greater -one’s want the more difficult is the change of locality. Quickness of -response demands both intelligence and nobility. - -Savings banks and insurance, while not directly affecting the demand -for labor, tend to equalize and reduce the losses which accompany -variability. They also tend strongly to call out that forecast of evil -and preparation for it which belong to thoughtfulness. The strokes of -fortune lose something of their unexpected and injurious character, -and men are put on voluntary and better terms with the world. - -We are not, however, to look on these reductions of danger as covering -the whole problem. Life has its accidents and we can greatly reduce -the evil results of them by patience and prudence, but there still 390 -remains the more thoroughgoing effort by which the evil is anticipated -and turned aside. - -There should be that general harmony of effort, that proportion of its -several parts to each other, that recognition of the common welfare, -which fortify us against disaster, and force it in the background when -it comes. There is a wise method in production, and a just relation of -its agents to each other, which should greatly reduce the liability of -a want of labor, and should ultimately remove it altogether. A true -democracy should be exempt from this general failure in the results of -activity. Much of our political economy has rested on inferences drawn -from a faulty state of society, as if it and the conclusions contained -in it expressed the real laws of our being. Society, in its most -civilized forms, has always developed a proletariat, it has suffered -drainage, and we have come to think this a sort of necessity, a -natural result of social growth. With this starting point and -expectation we are ready for periods of unemployment, and look at the -misery which arises from them as a corrective. Superfluous lives -cannot be gotten rid of on cheaper terms. We might as well suppose -that disease is an inevitable attachment of physical life and must be -left to go with it. Society never has too many workers, and when they -are not wanted it is because they have been in some way misdirected. -Strong men, industrious and intelligent men, are the wealth of -society. There is never a time in which there is little or nothing to -do in the world; if we think so it is because we cannot see, or see -falsely. Our intelligence determines what is to be done and our -diligence performs it. The world is never deficient in occasions for -labor, no matter how defective we may be in performing it. Nor is -well-devised labor wanting in its returns; intelligence and diligence, -in full exercise, always contradict the notion. The world could not be -the home of man on any other terms. Human life begins to be superfluous 391 -the moment labor miscarries, and the miscarriage sinks down to those -who have the least intelligence and industry. The constitutional -disease of society, that which it has propagated with most show of -knowledge, is ignorance and indolence. When we reach this stratum we -are always in difficulty; the more in difficulty because we come to it -in a sluggish rather than in a corrective temper. - -Incident to indolence and ignorance are those vices of temper by which -we wish to reach results without labor, or to reach them by the labor -of others rather than by our own labor. As long as these vices are -prevalent among men, whether in the upper or the lower strata of -society, or, as is sure to be the case, in both, periods of arrest -will come. Men will be baffled in their narrow aims, and will have no -broader, more generous ones to put in their place. For a time they -will lie idle till the customary impulses revive and once more set -them in action. Industrial inactivity is like a financial panic. It is -the result of the transient suspension of habitual feelings, and does -not relax till men return to their usual frame of mind. These -distrustful and apprehensive periods are liable to return as long as -men are not pursuing sound purposes in a sober way. Any deficiency in -fairness, integrity and mutual confidence divides society against -itself, and renders a portion of its efforts futile. This is the more -true as the division and subdivision of labor increases, and the final -adjustment of returns is made by complicated exchanges. When a portion -of the community finds its share of good things much reduced, when in -the distribution of the rewards of labor, custom or cunning or force -has robbed them of a reasonable portion, the motives of labor are -greatly lessened, the means of exchange are lessened and the sense of -unity and integrity of society is lost. There is in civilized society -a large body of just and honest production which goes far to sustain -the mind in renewed effort, and keep firm the ties which bind men 392 -together. Yet the element of distrust, as in a financial crisis, -extends through the community and weakens the points of life. - -The first condition of social, economic strength is that all the -members of society shall find suitable occupation and by means of it -become the givers and receivers of aid. This plain, simple fact has -been much obscured by accepting competition, often in an unethical and -unsocial form, as the general law of economic activity. This law it is -not; and it needs at all times to be held in check by ethical impulses -and by the welfare of the community. It is this welfare which is the -supreme law. Labor owes much of its degradation to a rigid and -unreasonable application of competition. As we go down in the scale of -occupations, and in efficiency in those occupations, the greater is -the injustice and injury that attend on competition till we reach a -point at which large numbers are pressed by it to the very verge of -life. Then comes in that mischievous generalization which tends to -make human degradation a permanent product of nature. The increase of -human life is said to be geometrical, the increase of the means of -life arithmetical, and so the two tendencies grind eternally against -each other. Our best sympathy is expressed in letting this collision -come to the quickest, shortest results. Some of this crushing process -obtains between ill-trained and sluggish, well-trained and active men. -Let it have way. - -Yet the agricultural products of the world have not only never given -out, they have never been brought near a maximum. Food, raiment and -shelter are most varied in kind and abundant in quantity where men are -most numerous. The Algonquin Indian wandered in the forest in the -winter, unfed and unsheltered. The foundation of his trouble was his -indolence and ignorance. The inhabitants of India may perish by famine -in large numbers. The distress arises not from the fact that the -people have outstripped the productive power of the world, but 393 -because they have outstripped their wisdom in handling those powers. - -Let men covet wealth, and at the same time use narrowly and -competitively the means of attaining it, and the two strata of -society, upper and lower, will shape between them a human life in -which want will stand over against luxury, hatred over against -contempt, and the two classes, oppressed by spiritual destitution and -physical poverty, will wage with each a variable and hopeless warfare -such as wisdom and good will can alone leave behind us. - -A first remedy for unemployment is to make employment remunerative; so -remunerative that the workman shall be the buyer of many things as -well as the seller of one thing. When his single sale of labor stands -in equipoise over against his many purchases, we shall have buyers as -well as sellers and our production and traffic will never cease. We -have in trade-unions a first step in the adjustment of exchange. -Workmen strive to escape the competition of the incompetent and -shiftless, to redirect distribution in ways more just and equal, and -by this means to be able to play their own part in economic life more -advantageously for themselves and for all. This effort is new in its -breadth of application, but has never been new with the wise and -thrifty. Personal skill and professional attainments have always -lifted themselves above the storm-swept plain of competition, and -gathered about themselves a prosperity and comfort resting on special -and superior exertion. So long as we subject ourselves to the fortunes -of the indolent and set up our standards of life at the very foot of -the slope, we shall have a competition like that of the Chinese to -contend with. We shall march so near the verge of the precipice that -many will be pushed over it, and the least flurry will be disastrous. -A sufficient return for diligence is the first claim and the -safety of labor; it enhances its motives and fortifies it in the 394 -possession of what it holds. - -With paucity of pay on the one side goes the superabundance of profits -on the other side. The returns of management should be more moderate, -more uniform, more consonant with the general welfare. We can hardly -doubt that an industrial community, well-organized, with a fair share -of intelligence, diligence and honesty, will commend reasonable -prosperity extending to all its members. Indeed this is what actually -takes place in the midway forms of effort. The very poor and the very -rich complement each other. Healthy and wholesome activity is as -possible to the community as to the individual. The chief difference -lies in the increased complexity of communal action and the ease with -which results are misunderstood and misinterpreted. The instinctive -and voluntary life of the individual is replaced in the community by -divided counsels. Men shape opinion and interpret results in view of -their own interests rather than in view of the public welfare. The -public welfare is as much within the scope of human thought, when -attention is directed to it, as is individual well-being. Indeed the -universal and stable prosperity of economic society is as much -dependent on the diligence and sobriety of its members as is -individual welfare on well-ordered labor. The qualities which enhance -success in the one direction are much the same as those which cause it -in the other direction. Extreme and intemperate action work the same -mischief in the one field as in the other. Society is sufficient unto -itself when its purposes and methods are truly social. A sudden -suspension of labor, a large number out of employment, are the result -of disturbing causes which have found their way into the ordinary -processes of production. These causes are an unreasonable accumulation -of power in single hands, speculative ventures and a social philosophy -which holds in light esteem the immediate interests of the mass of 395 -the community. I have in mind a peculiar manufacture which had -provided the needed buildings, and surrounded itself with the homes -and help called for. There came a combination of those engaged in this -industry. The works, comparatively new, were discontinued. Production -sought a new center and the old community was left to suffer the loss -of slow dispersion. - -We are protected against theft and criminal violence, but we are not -protected against the unprovoked losses which come to us from the -speculative aims of the adventuresome capitalist, though these losses -may greatly exceed those of robbery. The stability of labor and the -returns of labor are often affected in the great centers of production -by opportunities, fanciful or real, which offer themselves to a few of -achieving large wealth; opportunities not so much of creating wealth -as of raking it together. The mass of men do not so much as conceive -that they have any ground of complaint of operations which sweep out -from under them the supports of well-devised industry. Wealth which in -its making and use tends to break up the ordinary methods of industry, -to throw off the minds of men from the familiar reconciliations of -industry and, above all, to weaken the sense of responsibility which -lies between labor and capital, must, from time to time, issue in -industrial disaster to the confusion and loss of labor. Do the best we -may and we cannot anticipate every disturbance, but we are inexcusable -for overlooking the disasters we bring upon others who are working -with us. Much of what is called enterprise renders those engaged in it -almost wholly negligent of the incidental injuries which fall to those -about them. The equilibrium of labor is dependent on the equilibrium -of productive enterprises, and when these accept no restraints the -disturbance will reappear here and there in the productive world very -much at random. Labor presses at one point and is relaxed at another, -subject to the speculative schemes of capital. Extreme wealth in the -hands of a few lacks the economic and social and moral motives which 396 -make it a calculable and reliable means in the hands of many. When it -is in the process of accumulation it is lawless; when it is -accumulated it sinks into indolence. - -While some gains are pretty sure to accompany the acquisition of great -wealth, once acquired, it disturbs the even flow of economic forces, -and may easily give rise to irregular occupation that brings serious -disturbance to those whose daily wants are to be supplied by labor. It -may be thought that these fluctuations in production arise from its -very nature, and that if we leave men of very different degrees of -intelligence to contend with each other for the prizes of industry, -great inequalities of prosperity are sure to appear. We can escape -them only by forcing back enterprise and making the moderate, medium -men the standards of achievement. This presentation seems plausible, -and will always be urged by those who are willing or eager to take -large risks. Men of large productive power are easily stimulated, and -their resources are kept, in reference to the community at large, in -the most fruitful form when they are compelled to moderate their -efforts, and are not left to the extreme and eccentric ways normal to -them. The community is interested in habitual lines of industry more -than in those which disturb the minds by sudden profits which cannot -be emulated or repeated. Men will separate themselves from their -fellows in the rivalries of production. Only thus is the power of -intelligence fully disclosed, yet the ordinary arrangements of -society, its privileges and opportunities, should be made as equal as -possible; no unfair advantage should be given to one or another form -of production; nor methods be allowed to the successful in achieving -wealth which are not admissible in the community at large. The laws of -the game should be wisely framed and firmly preserved. It is the able -and ambitious who bring the most strain to safe restrictions, and for -whom they are chiefly made. Equality of opportunity is the cardinal 397 -principle, and cannot be sacrificed in favor of enterprise. The -enterprise that is wholesome keeps within this law. It may also be -thought that this rigid restraint would deprive the community of some -of the most prevalent means of welfare as well as of some of the most -illustrious agents in prosperity, and that those great and efficient -combinations which we have come to designate as trusts would be lost -to us; that as the result of this loss we should quickly settle down -into a sluggish routine, mediocre ideas ruling the public mind, and so -miss that very prosperity of which we are in search. Industrial -corporations are most efficient agents in wealth-making. We cannot for -a moment think of throwing any real obstacle in the way of their -formation. But while we need their aid, we should also remember the -evils which are liable to come with them. They are the creatures of -law, and the law in giving birth to them should assign them the form -and restrictions which are most consistent with the public welfare. -They are not to be allowed to fall into speculative hands, an -instrument of unrestrained power. - -Industrial corporations afford ready means by which small capital and -moderate men are compacted into a service quite beyond the range of -individual producers. The difficulty has been that much dishonesty has -entered into the formation of corporations, and that unreasonable -power has been exercised by those who have had them in charge. The -responsibility of a corporation to the community, expressed in a sound -financial organization and in the relation of its officers to its -stockholders, would in no way restrain the usefulness of these -industrial agencies, and would make them wholly consistent with -extended and equal opportunities in production. Immense wealth has -often been acquired in connection with corporations whose usefulness -to the public has been thereby restricted and the profits of -stockholders disregarded. Nowhere is the eagerness of personal -enterprise so tempted, nowhere does it display itself more 398 -disadvantageously than in the large and oftentimes obscure -undertakings of corporations. It is not in reduction of these -agencies, but in behalf of their safe and profitable use, that the -claim arises for uniform and well-regulated action. In large -corporations, as in insurance companies, when the business itself has -fallen into routine, extravagant salaries have been resorted to as a -means of increasing the returns of officers. Oftentimes the plea for -raising salaries is one which is self-propagating. Expenses have been -greatly enlarged and the remuneration must keep pace with them. Yes, -but will not this very increase lead to increased expenditure? -Industrial corporations have been, in the present generation, a -conspicuous means of production, but they have also conspicuously -promoted a bad distribution of wealth, and so helped to promote -irregularity and ultimate suspension in the productive process. There -may never come a time in which the adventuresome capitalist will not -magnify his own usefulness to the community, but there may come a time -in which men shall see that the wealth of a few may be purchased at -the expense of that general comfort which is the proper return of -industry. - -A possible rapidity in the acquisition of wealth inflames the -speculative temper. We mean by the speculative temper, purchase and -sale, not in reference to production but with the hope of making large -profits independently of production. Speculation is an expression of a -venturesome spirit which, in its impatience, lays light emphasis on -the usually slow methods of increase, and promises itself a rapid road -to success. This hope is often disappointed, and when disappointed -carries with it a more or less extended retardation of business. When -the annual losses by bankruptcy in the United States reach -$200,000,000, the distress of those whose means of livelihood have -been involved in this overthrow must become a very sensible factor. 399 -Such a sum would, in its successful use, provide for many households. - -The temper which goes with sanguine and unscrupulous methods is a -careless, and often a cruel, one. The democratic notion of equality is -overridden, is pushed aside as of no significance in the business -world. The same persons who insist on an open shop, and give free play -to competition when it depresses labor, regarding it as a familiar and -convenient principle in determining wages, may combine with each other -to control products and enhance profits. The general welfare, which is -the controlling idea, is lost sight of or readily forgotten. They have -one standard when they look out on the community at large, and another -standard when they are preparing the way to make and hold fast their -own gains. The directors of business come easily to think that the -welfare of the community is identical with their own welfare, and that -the enterprise with which they sustain their own affairs is identical -with that on which the public prosperity depends. They readily come to -the conclusion that their activity, so essential to the community, -should be cherished by the community. How possibly can production -progress without them. Discrimination in their favor is a short cut to -the common prosperity. Men of comfortable means and the poor even owe -what they have to the enterprise which scatters wealth everywhere. -There is sufficient truth in this feeling, when not too boldly put, to -hide its failures. The expenditures of the very rich in the purchases -and exchanges they involve do carry a measure of advantage to all, but -they also bear with them an unjust distribution, a luxury and a -poverty, which weaken the unity and sap the strength of society. It is -the very gist of democracy that each man shall count one; that in -spite of the diversities and the advantages among men they shall still -remain units of the same value in the freedom and propagating power by -which the gains of the race are stored. It is neither identity nor 400 -arbitrary difference that is admissible, but every man and every class -of men carry with them the potentialities, the social and spiritual -possibilities, which are the germs of historic development. This is -the principle with which all petty social distinctions and all civic -tyrannies have been at war. - -While, therefore, the evil of monopolies may appear in various forms -and be met in different ways, they cannot be permanently removed -except by social conditions which equalize opportunities and compel -wealth and power, in all their activity, to conform to general safety. -Production in all its forms and in all its agents must be subject to -that temper of fairness, and come under those principles of equal -rights, which bind the parts of the community together, and make them -one producing and one enjoying agency. Every assertion of settled -superiority in persons, classes and races must be set aside, and the -world in its physical, intellectual and spiritual wealth be left open -to all. Thus history has treated men, and is more and more treating -them, in their claims to consideration. This birthright of men is not -to be denied or stolen; for they who steal it have nothing more than -this same birthright to plead in extenuation, the combinations which -look to the defense and extension of these original gifts are in -order, and all combinations which carry them beyond the bounds of -their own territory are another outbreak of anarchy. - -The soundness of this assertion has been recently exemplified in the -history of Pittsburg. Pittsburg is the center of an industry which has -come, perhaps more than any other, under the domination of a few -leading men. In the Homestead strike they succeeded in dealing a heavy -blow to workmen in their efforts to secure something like a fair hold -on production. A little inquiry into a community built up for a few -and ordered by them discloses conditions quite at war with general -well-being. Wages are kept down by the constant presence of the -unemployed: the accidents of a dangerous occupation are left to fall 401 -upon workmen; the health of the community suffers great neglect, the -remonstrances of workmen are met with the response, If they do not -like the method let them quit; and the general good order and comfort -of citizens receive but little attention. Here is an object lesson in -which work, sure, skilful and unflinching; wealth, eager, unscrupulous -and unsympathetic, have divided the world between them; no right -gained, no power lost. Men may make wealth under these conditions, -withdrawing it from the fitting returns of labor, but they cannot, -wise as they may be or generous as they may seem to be, restore that -wealth to the community in a form in which it will subserve the same -living purpose it might have subserved if it had never been withdrawn. -The life of a community is achieved where its activity is most intense -and constant. Failing in our service at these vital centers, no -extraneous effort will cover our fault. We might as well draw sap from -a tree and then pour it out on its roots. - -We have now given three constitutional remedies for the want of -employment. The first is a more equal distribution of the rewards of -production, thus making the demand for products as extended and -uniform as their production. The second is increased restraints, -especially in connection with corporations, in the action of the -leaders of industry, rendering them more amenable to the wants of the -community to which they belong. The third, arising from the other two -and supporting them, is more unity, more harmony between the several -agents of production. - -There was a report not long since in England of an industrial -commission, which had given protracted attention to the irregular -demand for labor. The remedies offered were chiefly palliative. It may -be thought that this form of cure is all within our reach; that what -is here offered as constitutional correctives are beyond our power. -There is some truth in the feeling, and would be much truth in it, 402 -were not the actions and the sentiments now enforced under urgent -consideration for reasons of public welfare, not directly involved in -unemployment. We cannot expect to remove so grave an evil as this, the -wavering demand for labor, short of some important change in the -organization of society. Society is a structure of so many and such -delicate dependencies that its perfect action must include the general -integrity of the current relations between men. Unwholesome results of -frequent recurrence are the most direct proof of an unsound system. -Palliatives may soften the evil but cannot overcome it. We should aim -immediately to reduce the difficulty and ultimately to remove its -causes. - - - - -QUESTIONS IN BUSINESS ADMINISTRATION. 403 - -BUSINESS ECONOMICS. - - - - The Modern Industrial System. - - 1. Describe the three-field system of agriculture. Page 2. - - 2. What were the significant characteristics of a manorial - society? Page 2. - - 3. What is said to justify the institution of private - property? Page 4. - - 4. What is competition in modern industrial life? Page 4. - - 5. Why has the name “capitalistic production” been applied - to modern industry? Page 6. - - 6. Compare the domestic system of industry with the - factory system. Page 7. - - 7. What are the fundamental conditions of our economic - life? Page 8. - - - The Agricultural Resources of the United States. - - 1. What has been the policy of the Government in its - disposition of the public domain? Illustrate. Page 9. - - 2. What has been the unique and characteristic feature - of the land policy of the United States? Page 9. - - 3. What has been the result of the land policy of the - United States? Page 10. - - 4. What was the first effort toward the solution of - farming in the arid soils of the West? Page 10. - - 5. Explain what is meant by dry-farming. Page 11. - - 6. How do the farms of the United States compare in 404 - size with those of European countries? To what is - this difference due? Page 11. - - 7. What does the movement of the population from the - farm to the city indicate? Page 13. - - 8. What change in method is agriculture undergoing in - the United States? Give the reason for this change. Page 14. - - 9. Discuss the cereal production of the United States. Page 15. - - 10. Upon what question does the future of the cotton - production depend? Page 17. - - 11. What movement is now put forth to aid in the - preservation of our forests? Page 18. - - - The Mineral Resources of the United States. - - 1. Into what groups may the natural resources of a - country be divided? Illustrate. Page 19. - - 2. What two answers are given to the problem of the - conservation of a limited supply of resources? Page 20. - - 3. What steps have been taken towards stopping the - devastation of our resources? Page 21. - - 4. What estimates are given as to the amount of coal - in the United States and as to how long this supply - will last? Page 22. - - 5. What is the most favorable situation for iron deposits? - State reasons. Page 24. - - 6. Where is the most wonderful iron-mining region in - the United States? What makes it such a remarkable - region? Page 24. - - 7. Of what importance are the precious metals? What - is the practical problem confronting American - gold-mining companies at present? Page 25. - - - 8. To what use was copper put in Homeric times? What has 405 - caused it to rise to the front rank in recent years? Page 26. - - 9. How does the present-day application of water power - to machinery differ from its application prior to - 1890? Page 28. - - - Capitalistic Production. - - 1. What five causes does the census report give for the - rapid industrial development in the United States? Page 30. - - 2. Give Carroll D. Wright’s definition of a factory. Page 31. - - 3. Illustrate the two meanings which “division of labor” - may indicate. Page 32. - - 4. Show how the subdivision of labor brings about the - extension of labor-saving machinery. Page 33. - - 5. Name the economies of a large-scale production. Page 36. - - 6. What improvements have made large-scale production - possible? Page 36. - - 7. In what lines of business is there little or no - development toward large-scale methods? State the - reasons. Page 37. - - 8. What is meant by standardization? What are the - advantages of such a system? Page 38. - - - Trusts and Monopolies. - - 1. Enumerate the phases through which combinations for - the purpose of fixing prices, have passed. Page 40. - - 2. What is the advantage of the corporation? Page 41. - - 3. Give a brief history of the trust movement. Page 42. - - 4. What economies are secured by a combined or federated - industry? Page 43. - - 5. Name some of the savings which are peculiar to - trusts. Page 44. - - - 6. Give an illustration showing the profits of a 406 - successful trust promoter. Page 45. - - 7. What is the effect of industrial combinations upon - competitors? Upon producers of raw material? Page 46. - - 8. Explain the two phases of the relation between trusts - and labor. Page 47. - - 9. What conclusion as to the power of the combination - over prices, does the Industrial Commission reach? Page 48. - - 10. From what two sources do the evils of combination - come? What remedies have been suggested to meet - both classes of evils? Page 50. - - - Speculation and Crises. - - 1. How does the speculator reduce for the merchant the - speculative risk attaching to price fluctuations? - Illustrate. Page 52. - - 2. What social value lies in the service of the speculator? - Illustrate. Page 53. - - 3. Explain the difference between legitimate speculation - and illegitimate speculation (gambling). Page 54. - - 4. What is a crisis? Page 55. - - 5. Discuss the immediate occasion of a crisis. Page 56. - - 6. What is W. S. Jevons’ theory as to the causes of - crises? Page 58. - - 7. Explain the over-production theory which is given - as a cause for crises. Page 58. - - 8. What is the credit theory of the cause of a crisis? Page 59. - - 9. Where is the true explanation of a crisis to be found? Page 60. - - 10. Is it possible to prevent the recurrence of crises? Page 60. - - - - The Modern Wage System. 407 - - 1. Give some beneficial results and some abuses of the - factory system. Page 61. - - 2. Name five points which Mr. Hobson gives to show that, - in the transition to the factory system, the position - of the laborer has been one of increasing dependence. Page 62. - - 3. How does President Hadley define wages? Page 63. - - 4. Describe the systems of labor which preceded the - modern wage system. Page 64. - - 5. How has the extreme individualism of Adam Smith’s - theory been modified? Page 65. - - 6. What are the three peculiarities of the sale of labor? Page 66. - - - Labor Organizations and Collective Bargaining. - - 1. Why have labor organizations grown more rapidly in - the United States and England than on the Continent - of Europe? Page 69. - - 2. What are the two types of trade unions in the United - States? Page 69. - - 3. Describe the two most important national organizations - which have been in this country. Page 70. - - 4. What are the methods by which labor organizations - monopolize the labor market? Page 71. - - 5. Why do labor leaders object to piece work? Page 72. - - 6. What are the two arguments in favor of shorter - hours put forth by the trade unionist? Page 73. - - 7. What is the economic justification of the shorter - working day? Page 74. - - 8. Give illustrations where unions have directly limited - the amount of output. Page 75. - - 9. What is the attitude of the majority of the employers - in the United States toward collective bargaining? Page 77. - - - 10. What erroneous ideas exist as to the purpose of labor 408 - organizations? Page 78. - - 11. Describe the method of settling an industrial dispute - by conciliation. Why is the principle of arbitration - fast going out of favor? Page 79. - - - Women and Children at Work. - - 1. Describe the evils of the early factory system in - England. Page 80. - - 2. Are the women crowding the men out of their - occupations and taking their places? Page 81. - - 3. What is the most important reason for the low economic - position which woman occupies in the industrial - world? Page 83. - - 4. How does George L. Bolen justify the employment - of women? Page 86. - - 5. How can the evil arising from child labor be cured? Page 87. - - 6. What obstacles have been in the way of efforts to - improve labor conditions by legislation? Page 88. - - 7. Name, and give examples of, the two classes into - which the factory acts may be divided. Page 88. - - 8. What has been accomplished in the United States in - the way of labor legislation? Page 89. - - - Unemployment and Insurance. - - 1. Classify the unemployed. Page 91. - - 2. What are personal causes of unemployment? Page 92. - - 3. Name some industrial causes of unemployment. Page 93. - - 4. In what does the remedy for the normal unemployment - in modern industry lie? Page 95. - - 5. Suggest some methods of alleviation of the evils of - unemployment. Page 96. - - - 6. State briefly the common law doctrine regarding 409 - liability for accident. Page 98. - - 7. What have foreign countries done toward placing the - burden of industrial accidents upon the industry itself - and not upon the laborer? Page 99. - - 8. Describe the establishment of compulsory insurance - against sickness and old age in Germany; in Great - Britain. Page 100. - - - Machinery and Industrial Efficiency. - - 1. What three evils are charged against machinery? Page 101. - - 2. How does the reabsorption of labor displaced by - machinery depend upon the demand for an article? Page 102. - - 3. How may machine methods cause irregularities in - wages and employment? Page 104. - - 4. Show the need of a system of industrial education - in the United States. Page 107. - - 5. Describe the system of industrial education which - exists in Germany. Page 107. - - 6. How does the English system of industrial education - differ from the German? Page 108. - - 7. What is the character of the industrial schools of - the United States? Page 108. - - 8. How have the people of the United States been aided - in their industrial development? Page 109. - - 9. What two obstacles have been met by the movement - for better industrial education in the United States? Page 109. - - - Profit-Sharing and Co-Operation. - - 1. Name the three principal methods of profit-sharing. Page 110. - - 2. What is the economic theory of profit-sharing? Page 111. - - 3. What are the objections against the profit-sharing 410 - system? Page 112. - - 4. Why is the system of profit-sharing comparatively - limited? Page 113. - - 5. According to President Hadley, where is there more - chance for the success of profit-sharing? Page 113. - - 6. How does co-operation differ from profit-sharing? Page 114. - - 7. What are the reasons for the lack of success of - co-operation in this country? Page 115. - - 8. Describe the methods of the Rochdale Society. Page 115. - - 9. How does producers’ co-operation differ from - consumers’ co-operation? Page 116. - - 10. Give three examples of successful productive - co-operation in the United States. Page 116. - - 11. Enumerate the advantages of co-operation. Page 116. - - 12. What is the ultimate ideal of enthusiastic - co-operators? Page 117. - - 13. Discuss the defects of co-operation. Page 117. - - - Problems of Distribution. - - 1. What are the three great problems of economic - society? Page 119. - - 2. Define functional distribution; personal - distribution. Page 119. - - 3. What views are given as to whether functional - distribution is actually governed by natural law? Page 121. - - 4. Discuss briefly the distribution of rent. Page 122. - - 5. What is the socialists’ idea as to the profits which - a business manager receives for his services? Page 123. - - 6. State three theories which have been developed to - explain the distribution of wages. Page 124. - - 7. How was the wealth of the United States distributed - in 1893? Page 125. - - 8. Are the poor becoming poorer? Page 127. 411 - - - Saving and Spending. - - 1. What is the relation between saving and spending? Page 129. - - 2. What is the real goal of all rational economic - endeavor? Page 130. - - 3. Give the arguments which are put forth condemning - luxury. Page 132. - - 4. What arguments are put forth to show that luxury - is an indispensable stimulus to progress? Page 133. - - 5. What is the attitude toward luxury taken by - economists? Page 133. - - 6. What is meant by “a socialization of luxury”? Page 135. - - 7. Give an illustration of a waste in consumption due - to lack of knowledge and training. Page 135. - - - Money and Banking. - - 1. What determines the value of money? Page 137. - - 2. Give the attempts made in the United States to create - a slow, steady inflation. Page 139. - - 3. State three arguments in favor of bimetallism. Page 139. - - 4. Where can we find a sufficient answer to the arguments - in favor of government paper money? State the answer. Page 141. - - 5. Of what does the money of the United States consist? Page 141. - - 6. What essential quality of good bank money do bank - notes lack? Explain. Page 143. - - 7. Enumerate the suggestions which have been made as - to a new basis for the issue of bank notes. Page 143. - - 8. Name two other problems connected with the banking - system of the United States. Page 144. - - - - Transportation and Communication. 412 - - 1. Describe the three kinds of discrimination. Page 147. - - 2. How do the state commissions differ in power? Page 148. - - 3. Explain the monopoly character of express companies. Page 149. - - 4. Show the importance of the internal natural waterways - of the United States. Page 151. - - 5. What problem is offered by our canal system? Page 151. - - 6. Show why the causes for the decline in tonnage of - American vessels are economic rather than political. Page 152. - - - Taxation and Tariff. - - 1. What is John Fiske’s definition of taxes? Page 154. - - 2. What rules of taxation were laid down by Adam Smith? Page 154. - - 3. What is the benefit theory of taxation? How does - this theory fail? Page 155. - - 4. What is the faculty principle of taxation? Page 155. - - 5. What measures have been suggested as to how to - measure ability? Give the objection to each. Page 155. - - 6. What are the arguments supporting progressive - taxation? Page 156. - - 7. Where does the Federal Treasury derive its revenue? Page 157. - - 8. What tax is the main reliance of the state and local - governments? Page 158. - - 9. Describe an ideal system of taxation for the United - States. What is the advantage of such a system? Page 159. - - 10. What is the character of the considerations in - determining tariff policies? Page 160. - - 11. Explain the home market argument in support of 413 - protection; the wages argument. Page 161. - - 12. What is the doctrine of comparative costs? Page 162. - - 13. How do free traders answer the home market argument? - The infant industries argument? Page 162. - - - The Functions of the Government. - - 1. Name the economic functions of the Government. Page 163. - - 2. What is the theory of anarchism? Page 165. - - 3. Explain Herbert Spencer’s theory of extreme - individualism. Page 165. - - 4. What is the theory of government most generally held - by economists and writers in the United States? Page 166. - - 5. In what country is the culture state theory very - generally held? Explain the theory. Page 167. - - 6. What does the view known as state socialism advocate? Page 167. - - 7. Give Professor Ely’s definition of socialism. Page 167. - - 8. Explain the cardinal and distinctive element of - socialism. Page 168. - - 9. Enumerate the socialists’ criticisms of our present - methods of production. Page 168. - - 10. What do socialists urge as bases of distribution? - What basis do socialists of today agree is the best - one to meet the requirements of justice? Page 170. - - 11. What were Henry George’s arguments against private - ownership of lands? Page 171. - - 12. What is the real issue as to the municipalization of - local public utilities? Page 172. - - - Economic Progress. - - 1. What improvement has been made in the condition of - the working class in the United States? In Great - Britain? Page 173. - - 2. What factors have aided in the enormous expansion 414 - of production? Page 174. - - 3. Give two reasons why labor has not profited more - by the great increase of wealth. Page 175. - - 4. State some lines along which reform is needed. Page 176. - - - Manufacturing. - - 1. How does the word “manufactures” as it is ordinarily - used today differ from its original meaning? Page 180. - - 2. What conditions have made western Europe and the - eastern part of the United States great manufacturing - sections? Page 183. - - - Modern Manufacturing Systems. - - 1. What new occupations did the factory system develop? Page 186. - - 2. How did the use of steam affect the location of - factories? Page 187. - - 3. What factors made the price of silk so high before - the nineteenth century? Page 188. - - 4. Why is Gary, Indiana, an advantageous location for - a manufacturing center? Page 189. - - 5. How is it possible to operate by water power, a factory - located a hundred miles from a waterfall? Give - two examples. Page 190. - - 6. Illustrate the use of electricity in a typical modern - factory. Page 192. - - - Use of Machinery in Manufacturing. - - 1. Describe the first machine used in the making of yarn. Page 193. - - 2. Enumerate some of the machines invented in the - eighteenth century. Page 195. - - 3. How did the invention of machinery affect the - importation of cotton? Page 196. - - - 4. Show the need of machinery in the iron and steel 415 - industry. Page 197. - - 5. Describe the earliest process of making pig iron. Page 198. - - 6. What is the Bessemer process of making steel? Page 201. - - 7. What have been the causes of the great development - of the iron and steel industry? Page 201. - - 8. What is the difference between English and American - steel works? Page 202. - - - Development of the Factory System. - - 1. State reasons for the early development of the factory - system in England. Page 204. - - 2. Why was the United States slow about developing - manufacturing industries? Page 205. - - 3. Why is any comparison of the value of the manufactures - of the United States with that of other countries - defective? Page 210. - - 4. Name an article which is the product of one factory - but which becomes the manufacturing material of - another. Page 211. - - 5. What factors have contributed toward making the - United States the world’s greatest manufacturing - nation? Page 212. - - 6. How can it be judged as to whether the value of - manufactures of a country is in excess of the consuming - capacity? Page 214. - - - Capital in Manufacturing. - - 1. Show the part capital plays in building up a company. Page 214. - - 2. What are the advantages gained by having a business - in the hands of a company or corporation? Page 215. - - 3. Compare the durability of gold with that of other - products. Page 217. - - - 4. What was the amount of capital employed in 416 - manufacturing industries in 1850? In 1905? Page 218. - - 5. How did the Census of 1905 differ from previous - censuses in the matter of manufacturing establishments? Page 219. - - 6. How does the growth in capitalization rank with that - of the other important branches of manufacturing? Page 220. - - - Trusts and Combinations. - - 1. What principle was the cause of the origin of the - modern company or corporation? Page 222. - - 2. Explain the provisions of a pool. Page 223. - - 3. How were the defects of the pool overcome? Page 224. - - 4. What are the advantages of a trust or combination? Page 225. - - 5. What has been the effect of trusts on prices? On - wages? Page 226. - - 6. Name and classify according to product the companies - of which the United States Steel Corporation was - formed. Page 228. - - - The Iron and Steel Industry. - - 1. What was the number of establishments for the iron - and steel industry in the United States in 1880? In - 1905? What does this show? Page 233. - - 2. What method was used by the early Germans for - extracting the iron from the ore? By the English - in 1700? By the early American colonists? Page 236. - - 3. Why was coke used in the smelting of iron ore in - England much earlier than in America? Page 238. - - 4. How did the development of railways aid in the - preservation of our forests? Page 239. - - 5. What is the puddling process? Why is it necessary? Page 240. - - 6. What process took the place of the puddling process? Page 241. - - 7. What is steel? How is iron obtained by the Bessemer 417 - process made into steel? Page 245. - - - The Textile Industry. - - 1. What is the most important of the textile industries? Page 247. - - 2. Compare the value of textile manufactures in the - principal countries of Europe during the period from - 1800 to 1896, inclusive, with that of the United - States during the same period. Page 247. - - 3. Define textiles. How are they made? Page 251. - - 4. What were the so-called “Manchester cottons”? Page 254. - - 5. Who invented the spinning jenny? What was its use? Page 255. - - 6. Up until the invention of the water frame, why was - the making of cloth entirely from cotton impracticable? - Page 256. - - 7. What was the spinning mule? By whom was it invented? Page 257. - - 8. What is the purpose of the cotton gin? Page 257. - - 9. What factors have made cotton the most important - textile? Page 258. - - 10. Why is the cotton industry moving toward the South? Page 262. - - - Manufacturing Industries of the United States. - - 1. Why was manufacturing neglected by the early settlers - of the United States? Page 263. - - 2. What manufactories sprang up in the nineteenth - century? Page 266. - - 3. Name the four greatest producers of manufactures for - exportation. Page 270. - - 4. When was the largest growth of agricultural exports - in the United States? Of exports of manufactures? Page 272. - - - 5. What articles are the chief requisites of 418 - manufacturing? Page 272. - - 6. How do you account for the rapid growth of copper - as an export of manufacture? Page 277. - - 7. Illustrate the fact that the United States does not - need to invade foreign markets with its manufactures. Page 278. - - 8. Distinguish between the gross value of the factory - product of manufactures and the net value of the same. Page 284. - - 9. Compare the growth of the exportation of manufactures - with that of the production. Page 286. - - 10. Under what head does the Bureau of Statistics classify - boots and shoes; flour; salted meats; illuminating - oil; pig iron. Page 287. - - - Concrete and Steel. - - 1. How do concrete and steel supplement each other? Page 322. - - 2. Of what is the standardization of concrete applications - indicative? Page 323. - - 3. What is a corrugated bar? Page 324. - - 4. Give an example showing the durability of the - Hennibique construction. Page 326. - - 5. What advantages over the wooden bearing pile has - the concrete bearing pile? Page 327. - - 6. How may the resistivity of usual concretes be - reinforced? Page 329. - - 7. Explain the use of wales in reinforcing a water front. Page 331. - - 8. How are the bearing piles of a wharf in the tropics - made? Page 332. - - 9. Enumerate various uses to which concrete has been - put in construction. Pages 333, 334. - - 10. What is the problem of the concrete telegraph pole? - How may this be overcome? Page 336. - - 11. How is the Corell tie made? The Percival tie? Page 337. 419 - - 12. What part does steel play in the construction of the - Gatun Locks of the Panama Canal? Page 337. - - 13. Give an illustration of the use of steel for molding - concrete. Page 339. - - - Chemistry and the Industries. - - 1. Why has it been necessary to put industry on a - scientific basis? Page 342. - - 2. Why is chemistry so closely related to the industries? Page 343. - - 3. Tell in your own words the story of the development - of the soda industry. Page 344. - - 4. Name three important industries which grew out of - the soda industry. Page 346. - - 5. Give an example of how science has led the way for - industry. Page 348. - - 6. What are the great achievements before the chemistry - of the future? Page 350. - - - The Producer-Gas Power Plant. - - 1. What was the drawback to the early development of - the gas engine? Page 353. - - 2. Why was the suction producer not practical? Page 354. - - 3. What led to the introduction of the pressure producer? Page 355. - - 4. What is the advantage of the down-draft producer? Page 355. - - 5. What is the ideal relative efficiency of the - producer-gas plant and the steam plant? The actual - relative efficiency? Page 360. - - 6. What defects in producer-gas plants were learned - from the inspection in 1908? Page 364. - - 7. Where are the producer-gas plants of England located? Page 366. - - 8. How can the price of power developed from fuel be 420 - kept down? Page 369. - - - Efficiency in Shop Operations. - - 1. What is the reason for the failure of many cost - systems? Page 371. - - 2. Upon what does the efficiency of a workman depend? Page 372. - - 3. What should be used as a standard for the measurement - of time? Page 373. - - 4. When should a bonus begin? Page 375. - - 5. What effect does the giving of bonuses have on the - efficiency of the foreman? Page 375. - - 6. What advantages are gained from having proper time - cards for the workmen of a concern? Page 377. - - 7. To be successful, how should efficiency methods be - introduced? Page 379. - - - The Bridge between Labor and Capital. - - 1. What is the chief cause at the bottom of all labor - disputes? Page 380. - - 2. When and how was the labor problem brought about? Page 381. - - 3. What three methods of solution are proposed for the - present problem of distribution? Page 382. - - 4. In your opinion which method is the best? - - - The Unemployed. - - 1. What is the central cause of the want of employment? Page 385. - - 2. Show the evil effect of ill-advised charity upon the - unemployed. Page 387. - - 3. What does the practice of giving old-age pensions - indicate as to the fairness of the distribution of the - returns of production? Page 387. - - 4. Name three ways in which the problem of the unemployed 421 - can be reduced. Page 389. - - 5. What are the effects of ignorance and indolence upon - society? Page 391. - - 6. If employment were remunerative, what would be the - results? Page 393. - - 7. What lines of industry should society court? Page 396. - - 8. What are the evils connected with industrial - corporations? Page 397. - - 9. Summarize the remedies for the want of employment. Page 401. - - - - - INDEX - - BUSINESS ECONOMICS - - - ACTS-- - factory, 88, 89. - - AGRICULTURE-- - character of, in U. S., 14. - most important branch of, 15. - reorganization of, 15. - - ANARCHISM-- - theory of, 165. - - AREA-- - land, of U. S., 9. - - - BANKING, 142-145. - - BAR-- - corrugated, 324. - - BARGAINING-- - collective, 77. - - BESSEMER-- - process, 201, 241-246. - - BIMETALLISM-- - arguments in favor of, 139, 140. - - BOARD-- - of arbitration, 79. - of conciliation, 79. - - BONUS-- - use of, 375. - - BRIDGES-- - construction of, 324-326. - - - CAPITAL-- - and labor, bridge between (article), 380-383. - in manufacturing, 214-222. - - CEMENT-- - Portland, 340. - - CEREALS-- - production of, in U. S., 15. - - CHEMISTRY-- - and the industries (article), 341-351. - a utilitarian science, 341. - how it creates industries, 348. - how it influences industries, 342. - - CHILDREN-- - at work, 86-89. - - CLASS-- - wage-earning, 61. - - COAL-- - waste of, 352. - - COMBINATION-- - advantages of, 43, 225. - causes of, illustrated, 227-230. - effects of, 46-49, 226. - upon competitors, 46. - upon consumers, 48, 226. - upon labor, 47. - upon opportunity, 49. - upon wages, 226. - forms of, 223-225. - in the railroad world, 146. - methods of, illustrated, 227-230. - phases of, 39, 40. - - COMMISSION-- - mandatory, 148. - supervisory, 148. - - COMPANIES-- - express, monopoly character of, 149. - - COMPETITION-- - defined, 4. - in modern industrial life, 4, 5. - - CONCRETE-- - and steel (article), 322-340. - applications of, 324-339. - as material of construction, 322. - chimneys of, 328. - effect of water on, 330, 333. - rapidity of construction of, 330. - resistivity of, 329. - - CONSUMPTION-- - economy in, 135, 136. - - CO-OPERATION-- - advantages of, 116, 117, 222, 223. - consumers’, 114. - defects of, 117, 118. - producers’, 116. - - CORN-- - production of, in U. S., 16. - - CORPORATION-- - advantages of, to industry, 41, 215. - industrial, 397. - United States Steel, 44, 227-230. - - COTTON-- - gin, 257. - manufacturing of, 247-262. - production of, in U. S., 17, 304. - world’s production of, 291. - - CRISES-- - credit theory of, 59. - defined, 55. - immediate cause of, 56. - must be regarded as unpreventable, 60. - over-production theory of, 38. - periodicity of, 57, 58. - - - DISCRIMINATION-- - kinds of, 147. - - DISTRIBUTION-- - of interest, 122, 123. - of profits, 123. - of rent, 122. - of wages, 123, 124. - of wealth, functional, 119-121. - of wealth, personal, 120, 125-127. - - DOMAIN-- - public, 9. - - DRY-FARMING, 11. - - - ECONOMICS-- - practical (article), 1-178. - progress in, 172-178. - - EDUCATION-- - industrial, 106-110. - - EFFICIENCY-- - application of, to department heads, 375-377. - defined, 371. - increased, illustrated, 374. - in shop operation (article), 370-379. - - ELECTRICITY-- - applied to manufacturing, 190-192. - - ENGINE-- - gas, development of, 353-356. - - EXCHANGES-- - of natural products, 182. - - EXPORTS-- - from U. S., 269-288. - - - FACTORY-- - acts, 88, 89. - described, 31. - system. (See System.) - town, rise of, 186. - - FARMS-- - number and size of, 11. - - FISHERIES-- - wasteful use of, 18, 19. - - FREE TRADERS-- - arguments of, 162. - - - GOLD-- - production of, 216, 217. - - GOVERNMENT-- - functions of, 163-172. - - - HOMESTEAD-- - defined, 9, 10. - - - INDIVIDUALISM-- - extreme, 65, 165. - modified, 166. - - INDUSTRY-- - causes of rapid development in, 30. - cotton, 247-262. - how carried on, 41. - iron and steel, growth of, 198-202, 230-246. - localization of, 33. - manufacturing. (See Manufacturing.) - relation between chemistry and, 341-351. - soda, 344-346. - specialization of, 32, 33. - textile, 247-262. - - INSURANCE-- - against sickness and old age, 100. - compulsory accident, 99, 100. - - IRON-- - processes of making, 198-201, 235-246. - - IRRIGATION, 10, 11. - - - LABOR-- - American Federation of, 70. - and capital, bridge between (article), 380-383. - child, 80, 86-89. - division of, 32, 33. - Knights of, 70. - legislation, purpose of, 68. - organizations, 68-77. - previous systems of, compared with modern wage system, 64. - sale of, peculiarities of, 66, 67. - woman, 80-86. - - LEGISLATION-- - factory, 97. - labor, purpose of, 68. - of child labor, 87-89. - - LIBERTY-- - industrial, 5. - natural, theory of, 166. - - LIVE STOCK-- - production of, in U. S., 16. - - LUXURY-- - attitudes toward, 132-134. - socialization of, 135. - - - MACHINERY-- - evils of, 101-106. - in iron and steel industry, 196-201. - in textile industry, 196. - - MACHINES-- - carding, 256. - early forms of, 193-196. - - MANOR-- - English, 1-3. - characteristics of, 2, 3. - - MANUFACTURES-- - census of, 207-211. - why misleading in U. S., 207, 211, 268. - concentration of, 33, 34. - exported from U. S., 269-272. - growth of, 30, 205-214. - growth of investment in, 218-222. - statistics of, 229-321. - - MANUFACTURING-- - application of electricity to, 190-192. - application of steam to, 187-189. - areas of the world, 181. - (article), 179-320. - capital in, 214-222. - cotton, 247-262. - establishments, 219-222, 233. - growth of, 205-214. - growth of investment in, 218-222. - industries of the U. S., 263-288. - machinery in, 193-203. - statistics of, 229-321. - systems of the world, 185-192. - - MARINE-- - merchant, 152-154. - - MONEY-- - government paper, 140, 141. - kinds of, in U. S., 141, 217. - value of, how determined, 137, 138. - - MOVEMENT-- - trust, 42. - - - OPERATIONS-- - change in, opposition to, 372. - shop, efficiency in, (article), 370-379. - - ORGANIZATIONS-- - forms of, 223-225. - labor, 68-77. - growth of, 69. - objects and methods of, 71-77. - - - PARTNERSHIP, 41. - - PENSIONS-- - old-age, danger in, 387. - - PILES-- - bearing, 327. - sheet, 327. - - POLICY-- - land, of U. S., 9, 10. - - POOLS, 40, 223. - - POPULATION-- - agricultural, decline in, 12, 13. - - POWER-- - water, of U. S., 27, 28. - - POWER PLANT-- - producer-gas, 352-369. - conditions favorable to, in U. S., 368, 369. - location of European, 366-368. - number and class of, 363. - relation of, to conservation of fuel resources, 352-369. - relative results of steam plant and, 356-363. - - PRODUCTION-- - capitalistic, 6, 29-39. - concentration of, 34. - large-scale, 35-37. - economics of, 35, 36. - peculiar to trusts, 44. - industrial effects of, 37. - in manufacturing, 36. - in retail trade, 37. - social effects of, 38. - of cotton, 291. - of cotton in U. S., 17, 304. - pig-iron, 230, 231. - - PROFITS-- - of promoters, 45. - - PROFIT SHARING-- - defined, 110. - economic theory of, 111. - methods of, 110, 111. - objections against, 111, 113. - origin of, 113. - purpose of, 110. - - PROPERTY-- - private, 3, 4. - - PROTECTION-- - arguments in support of, 160-162. - - - RAILROADS-- - public nature of, 148. - public ownership of, 149. - rates, 147. - - RATES-- - railroad, 147. - - REGULATION-- - legislative, of trust evils, 50, 51. - - RESOURCES-- - agricultural, of U. S., 9-19. - forest, destruction of, 18. - mineral, of U. S., 19-29. - alarming condition of, 20-22. - - REVENUE-- - sources of, 157-159. - - REVOLUTION-- - industrial, 5, 6. - - ROTATION-- - three-year, 2. - - - SAVING-- - relation of, to spending, 129, 130. - why necessary, 131. - - SERVICE-- - Forest, work of, 18. - - SOCIALISM-- - as a scheme of distribution, 170. - defined, 167, 168. - difficulties of establishing, 169. - state, 167. - - SOCIETY-- - industrial, 1-8. - Rochdale, 115. - - SPECULATION, 51-55. - - SPECULATOR-- - social value of, 53. - - SPENDING-- - relation of, to saving, 129, 130. - - SPINNING JENNY, 196, 255. - - STANDARDIZATION-- - system of, 38. - - STANDARD OIL TRUST-- - when formed, 42. - - STATE-- - as a regulator of industry, 7, 8. - culture, theory, 167. - ownership, 171, 172. - - STATISTICS-- - accidents in German industries traceable to different causes, 97. - cause of idleness, members of trade unions (1900), 93. - cause of poverty, 92. - course of wages during 19th century, 173. - expenditures for different purposes in different places, 128. - growth of manufactures in 19th century, 30. - hand and machine methods compared, 103. - industrial and commercial gas trusts in U. S., (1860-1900), 42, 43. - of commerce in U. S., 308, 309. - of manufactures, 229-321. - annual value of, 289. - capital invested, 313, 314. - exportation of, 291. - importation of, 289. - summary of, in U. S., 299. - value of products of, 318-321. - wage-earners employed (1900), 315. - of population engaged in manufacturing in U. S., 310. - - STEEL-- - and concrete (article), 322-340. - as material of construction, 322. - re-inforcement, styles of, 324-326. - - STRIKE-- - defined, 78. - losses from, in U. S., 78. - - SYSTEM-- - canal, 151, 152. - domestic, 7. - factory, - beneficial results of, 60, 61. - development of, 203-214. - in England, 214. - in U. S., 205, 206. - evils of early, 80, 101-106. - origin of, 185. - independent treasury, 144. - industrial, modern, 1-8. - characteristics of, 3. - of interchangeable parts, 38, 39. - of standardization, 38. - three-field, 2. - wage, modern, 60-68. - - - TAX-- - defined, 154. - general property, 158. - inheritance, 159. - - TAXATION-- - powers of, 154. - problems of, 155, 156. - rules of, 154, 155. - - TEXTILES-- - described, 251, 252. - manufacturing of, 247-262. - - TRADE UNIONS-- - local, 69. - national, 69. - object and methods of, 71-77. - - TRANSPORTATION, 145-154. - inland water, 151. - ocean water, 151. - - TRUSTS-- - advantages of, 225. - and combinations, 222-230. - defined, 216. - economics of production peculiar to, 44. - effects of, - upon competitors, 46. - upon consumers, 48, 226. - upon labor, 47. - upon opportunity, 49. - upon wages, 226. - evils of, remedied by legislative regulation, 50, 51. - industrial and gas, organized in U. S. (1860-1900), 42, 43. - reasons for growth of, 43, 45, 46. - - - UNEMPLOYED-- - classified, 91. - the (article), 384-402. - - UNEMPLOYMENT-- - a permanent problem, 95. - cause of, 91-95, 384-386. - extent of, 90. - remedies for, 95, 387-390, 393-401. - - - WAGES-- - iron law of, 124. - - WATER FRAME, 256. - - WEALTH-- - functional distribution of, 119-121. - personal distribution of, 120, 125-127. - - WOMEN-- - at work, 80-86. - economic position of, 84. - - - - - * * * * * * - - - - -Transcriber’s note: - -Obvious printing errors, such as backwards, upside down, or partially -printed letters, were corrected. The last two lines of the Table of -Contents, printed in reverse order, were corrected. Final stops -unprinted at the end of sentences were added. - -Dialect, obsolete and alternative spellings were left unchanged. -Pittsburgh (PA) is spelled without the final “h” throughout the book. -Omitted words were not added to the text. - -Footnotes in the text were renumbered sequentially and moved to the -end of the article in which the anchor occurs. Footnotes within tables -were changed to letters and were moved to follow the table in which -the anchor occurs. In some tables, a footnote may have more than one -anchor. - -Wide tables were split for easier viewing on small screens. - -The following items were changed: - - ‘Bimettalism’ to ‘Bimetallism’ in the Table of Contents, XV - added space between ‘Ph. D.’ for Ernest Ludlow Bogard byline, page 1 - ‘whch’ to ‘which’ …by which iron and steel…, page 201 - ‘1880’ to ‘1800’ …ten times as much as in 1800…, page 231 - ‘hamp’ to ‘hemp’ …flax, hemp and jute…, page 251 - ‘million’ to ‘millions’ …and 1908, 99 millions…, page 276 - ‘manfactures’ to ‘manufactures’ …was manufactures ready…, page 281 - ‘guns’ to ‘gums’ …the oils, gums and resins,… page 341 - ‘ultilitarianism’ to ‘utilitarianism’ …The utilitarianism of…, pg 342 - ‘guns’ to ‘gums’ …of gums; of sugar and…, pg 343 - ‘grinding’ to ‘guiding’ …also the guiding spirit…, page 346 - ‘lead’ to ‘led’ …has led the way…, page 349 - ‘notions’ to ‘notion’ …democratic notion of…, page 399 - ‘lead’ to ‘led’ …science has led the way…, page 419 - added comma to index entry: STRIKES losses from, in U. 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