# Industry and Democracy

New Outlook, Volume 97; March 18th, 1911
WHAT is commonly called the Labor Question is something more than a problem of economic organization; it deals with all that is most fundamental in the life of the commonwealth. It challenges the postulates of our political science; the answer to it involves the validity of the principles laid down in the Declaration of Independence and the permanency of the Constitution of the United States. To answer it in one way means the surrender of popular government; to answer it in another way means the fulfillment and completion of democracy.
The great fact of the age is Democracy, the coronation of the common man. For the past hundred years he has been steadily coming to his own. Not only in the republics, the United States and France and Switzerland, not only in free England and her colonies, but in all the states described as monarchical, the enfranchisement of the common man has been going forward. The Emperor of Germany, who declares that he rules by the will of God, nevertheless is compelled to ask the common man for the revenues by which he rules; even the Czar of Russia and the Sultan of Turkey have been compelled to stoop to him, and the lords of political privilege everywhere have discovered that there is no stability for the throne that is not " broad-based upon the people's will." Popular government is everywhere in the ascendant, and not only is government of the people, by the people, for the people, not going to perish from the earth, it is going to possess the earth, and that at no distant day. Monarchical forms may linger long, as in England, but the democratic fact will prevail everywhere as it prevails there.
In our own country we have given, in theory, the most unreserved expression to the principle of political democracy; the principle is yet but imperfectly worked out here, as everywhere, and we have much exacting business upon our hands in completing and developing our democratic institutions—work that will call for a great deal of patience and toil and self-denial; but we believe, most of us, in the principle; we have committed ourselves to it, and we expect, by means of it, to unify the diverse races now thronging upon this continent and to make of them a strong, free, self-governing people.
But there is one department of our life, and this the largest interest of all, which has not been democratized. Our industries are still largely on an autocratic or feudalistic basis. We have been trying to correlate a political democracy with an industrial feudalism. They do not work well together. I do not think that they will endure together. They are antagonistic principles. The development of the large system of industry accentuates the antagonism. We may say what Lincoln said of slavery and freedom: the country will become eventually all democratic or all feudalistic. The workingmen will lose their political liberty or they will gain their industrial liberty. I do not think that they will lose their votes; I think that they will gain their right to have a voice in determining what wages they shall receive and under what conditions they shall work.
Let me explain what I mean when I say that the basis of our present industry is feudalistic. I am speaking, of course, of the large system of industry under which the world's work is now mainly done, and I am assuming, also, that there is no organization of the laborers, since that is the condition which industrial feudalism holds up as the ideal and struggles to establish. Under this system the capitalist manager assumes the exclusive right to fix the rate of wages, the hours of labor, the conditions under which the work is done. He cannot, of course, discuss these matters with each of his one thousand or ten thousand workmen; there can, therefore, be no semblance of a bargain in the case; it is an ultimatum; the employer presents it, the workingman can take it or leave it. It would be absurd for a single laborer to propose to chaffer about wages or hours of labor with the American Steel Corporation or the Pennsylvania Railroad Company. Out of these circumstances very naturally grows the assumption, on the part of the employer, that the right as well as the power to fix the laborer's wages belongs exclusively to him. When, therefore, any man or any body of men proposes to have something to say about it, he indignantly resents this proposal; he calls it interfering with his business. What he says to them is precisely this: "It is none of your business what wages you shall receive; it is my business to tell you how much you can have, and I cannot permit any one to dictate to me about my business."
Of course the employer would say that the workingman, or the group of workingmen, to whom he presents this ultimatum can seek employment elsewhere; but he would also say, if he is morally consistent, that all other employers ought to treat workmen in the same way that he treats them; and if all do, then the workingman's right to have something to say about the wages he shall receive is practically denied. Under such a regimen he becomes a beneficiary, a dependent; reversing Sir Henry Maine's phrase, he has gone back from contract to status; he is not a free man; he has sunk into servitude. This is what I mean when I say that the basis of our present industry is feudalistic.
The workingmen found out, a good while ago, that the only possible way of preserving and enforcing their right of contract in the sale of their labor was by uniting together and insisting on collective bargaining with their employers. If the capitalist manager's one thousand or ten thousand employees unite in presenting their demands, they may succeed in getting some attention to them. By union and organization they may keep themselves from being reduced to a position of dependence and servitude, and may establish their right to a share in the wealth created by their labor and a voice in the distribution of the product of industry.
This means, of course, the recognition of a partnership of the men in the business by which they earn their livelihood •, their employer has invested his money in it, and they have invested their lives; they are entitled to such recognition. When this right is recognized, they are not any longer subjects; they are fellow-citizens and freemen; the common man has come to his own in the industrial realm; our democracy has completed itself.
Long ago we gave the common man the right to take part in making the laws of the State and the Nation and in choosing the men who should administer those laws; we let him say who shall be our Presidents and our Governors and our judges; but we have been afraid that it would never do to let him have anything to say about the wages he should receive or the hours he should work. I do not think that this fear is rational , at any rate, the thing that he asks for is his right, and we have got to give him his right and teach him how to use it. And since, under the present industrial system, it is impossible for him to assert and maintain this right without organization, all who love justice and freedom ought to encourage him to organize, and stand by him and see that he gets the fruits of his organization.
There is no other way, I repeat, under the pressure of the stupendous combinations of capital, to rescue labor from degradation except by the firm organization of labor. There is no salvation for our democracy under the wage system but in this concerted resistance of the wage-workers. That they are prone to abuse their power has been fully admitted, and we all know how impossible are some of their methods, and how needful it sometimes is to resist and defeat their aggressions. The acquisition of power by those who have long been deprived of it is apt to be attended by outbreaks of willfulness and arrogance. Patience and firmness will be needed in dealing with such cases. But as soon as we have made up our minds to be just it will be easier to be patient and firm. We can stand up against other people's wrongs much more successfully when they know that we are ready to concede and maintain their rights. I do not expect to see lawlessness disappear from trade-unionism so long as there is so strong a disposition among employers to insist on making trade unions outlaws. When workmen's right to combine for the protection of their interests is fully and frankly conceded, we shall, I believe, soon see a great diminution of violence. At any rate, we shall then be in a position to deal with it, if it appears, sternly and effectively.
I do not, however, indulge the expectation that no mistakes will ever be made and no wrongs committed by workingmen after their right to combine is fully recognized. They are human, like the rest of us; and if they sometimes act foolishly and selfishly, those of us who never make any mistakes or do any mean things ourselves will be warranted in stoning them with stones.
The fact that they do sometimes act unreasonably and even brutally is constantly and passionately cited as a reason why they should not be permitted to combine. But I seem to remember to have somewhere heard it intimated that corporations have been known to behave lawlessly and flagitiously. Shall we therefore have no corporations? If power is to be denied to all who abuse it, most of us will have to go powerless for the rest of our days. If those who have most abused it are to be the first to be deprived of it, then I say deliberately that there are ten reasons for prohibiting corporations where there is one for prohibiting trade unions.
The power that men need to make them men must be given to them even though they may sometimes abuse it. That is the principle of democracy; and the time has come when the principle of democracy must be unreservedly accepted and unflinchingly applied to the organization of our industries. The common man, the workingman, must be a freeman. He must not be required or permitted to occupy a dependent or servile position in the industrial world.
It is well to get clearly before our minds the issue which confronts us. The question is whether we are ready to see our democracy complete itself. To that question the answer will not be unanimous. We have among us not a few lords of privilege who have been practicing feudalism long enough to lose their faith in democracy. Men who mount to affluence in a decade or two are quite apt to acquire contempt for those who earn their daily bread by manual labor. Some of them have sense enough to conceal it, but there are many who blurt it out with no misgiving. "Mr. Worldly Wiseman," to whom Mr. Finley Dunne has introduced us in his "Interpreter's House," is not an imaginary type; his cynicisms are but faithful reports of what may be heard anywhere in the rich men's clubs and the smoking-rooms of the American liners. The people who think that popular government is a delusion, that our public school system is a curse, and that what we want is an American House of Lords to overawe and hold in check the insurgent democracy, may be met with here and there in the resorts frequented by the new rich. The funniest thing for many a moon is the spectacle of these people beating their breasts with alarm lest Theodore Roosevelt should make himself a king!
The existence of a considerable revolt against democracy in our American citizenship is a fact to be reckoned with. It is not a matter of wonder. Many of these people are living a life which in all its features is at war with the first principles of democracy. They could hardly be expected to maintain their faith in a social theory which all their practice flouts.
There are many others whose lives are simpler, but who are beginning to shrink from the burdens which democracy imposes. Most of us have been inclined to assume that democracy was a sort of automatic device; given universal suffrage and free schools, and the machinery would run without much superintendence. It begins to be evident that this is a mistaken theory. Democracy is precisely the kind of government which requires of its citizens the largest amount of gratuitous service. We can have the best government in the world with such citizens as are now upon our soil; but only when men of intelligence and force face the responsibilities of citizenship, and give time and toil and patience to the work of training and guiding the voters. Good government under any system is a costly product, and under a democracy the cost must be paid by the entire body of competent citizens. It is a war in which there is no discharge; the vigilance which is the price of liberty is not only eternal, it is universal.
Now, it is a melancholy fact that a good many of our well-to-do and not evil-minded citizens are getting tired of the responsibilities of democracy; they find that it is a strenuous business, and they would fain be rid of it. They would rather give their days to gain and their nights to pleasure than to shoulder the task of governing this republic. Some of them talk very pessimistically about the future of popular government, and even hint now and then at the beneficence of a dictatorship. Such men are not likely to welcome the suggestion of the extension of democracy to the industrial realm. The existing feudalistic regime suits them better. They do not relish the task which would be thrust upon them by the democratization of our industries. They are right in thinking that it is a difficult task. Perhaps they deem it impossible. Before coming to that conclusion, however, it may be well for them to consider a few of the alternatives.
There are some difficulties, I believe, in maintaining the feudalistic regime. The employer who refuses to recognize the right of his men to have anything to say about wages or hours of labor does not always have an easy and quiet time of it. Troubles of a pretty serious nature do arise, even under such management. Are not the frictions and collisions and losses of the autocratic regime quite as injurious as any that would be likely to arise under a more friendly arrangement?
The man who thinks it would be difficult to lead his employees in the peaceful paths of productive industry may well consider whether it is any easier to drive them. He may even find it profitable to consult his own experience in answering that question. It is prudent, also, to remember that we are dealing here with one of those secular forces against which it is futile to contend. If anything is clearly written in the book of destiny, so far as its pages have thus far been turned over, it is that democracy is going to complete itself. That process has been moving steadily forward during the past century, and it is not likely to be arrested. Feudalism has made its last stand in the industrial realm, but it is not probable that it can hold that fortress. The prevalence of the large system of industry will not be suffered to degrade our wage-workers to the condition of serfs. There has never been a day when such a result was less probable than it is to-day. If the employing class should put itself in opposition to this movement for the emancipation of the working class, the employing class would cease to exist; the wage system would be destroyed; industry would be reorganized on a new basis.
It is well, therefore, for our captains of industry to consider carefully what may be involved in their refusal to recognize or tolerate the only method by which the workingman can assert and maintain his rights. It is a perilous thing, as history shows, to deny the manhood of the common man. Kingdoms and thrones have been shaken by that refusal; the kingdom of capitalism is by no means secure against such an overturning. The danger of the hour, as it appears to me, is that our captains of industry will array against themselves the gathering might of resistless democracy and be trampled in the dust. It would be far better for them, and for the common man, and for all the rest of us, if they would keep the leadership of industry. Leadership they can have, if they have sense to claim it and wit to exercise it—leadership, but not lordship. Industrial democracy wants leaders, but not autocrats; and large rewards and precious—not billions of dollars, but blessing and honor—are waiting for those who have the vision and the courage for this high service.
Industrial democracy means giving the wage-workers, through collective bargaining, a voice in the determination of their share in the joint product. It does not mean the domination of the business by the men and the subjugation of the employer, though this is the employer's apprehension, and this is the notion that sometimes gets into the workingman's head. Mr. Keir Hardie, M.P., for whom I have great respect, spoke only the other day of the prospect that the working class was about to become the ruling class. Pardon, Mr. Hardie. but in a democracy there are no ruling classes. We call no man master, not even the walking delegate. An inverted feudalism, with the common man on top, would be no whit better than the old-fashioned sort with the common man under foot. We will have neither of them.
You are not going to tyrannize over us, Mr. Keir Hardie, with your labor organizations, and we do not believe that you really want to do any such thing. You are going to stand by our side with power in the industrial realm to assert and maintain your rights^as men. and with a sense of justice in your breasts which will enable you fully to recognize the rights of your capitalist employer; and we are going to work together, all classes—men of capital, men of organizing talent, men of skill, men of brains and men of brawn—to build a real commonwealth.
So shall we realize our democracy. It has never been anything more than the skeleton of a democracy; so long as industry is feudalistic it cannot be. But when the common man is emancipated and called into partnership by the captain of industry, we shall have a real democracy. No superhuman vision is needed to discern the fact that the confusions and corruptions of our political democracy are largely due to the disorganizing influence of this industrial feudalism, in constant contact with it, and continually thrusting its alien conceptions and ideals into the political arena. When industry is fairly democratized, it will be much easier to reform our politics.
The relinquishment of autocratic power is not apt to be a welcome suggestion; the cases are few in which it is surrendered without a deadly struggle. But within the last generation we have seen the feudal rulers of Japan resigning their power and entering heartily into the life of the commonwealth, with great honor to themselves and great profit to their nation. It is not incredible that many of our own captains of industry will discern the wisdom of a similar sacrifice. Indeed, there are those among them to whom this solution of the labor problem seems altogether feasible.
The late William Henry Baldwin, Jr., whose biography has been so admirably written by Mr. John Graham Brooks,(1) was a type of the class of employers to whom the democratization of industry is the way of life and peace. As a railway superintendent and president he had large experience in dealing with men, and all the positions taken in this article were held by him with the utmost firmness. In the book to which I have referred, and which ought to be read by every American employer, these opinions of his are set forth with great fullness. Speaking of the extension of collective bargaining, he says: "The advantages of this system are very obvious in that it is a system founded on an intelligent treatment of each question at issue, and encourages education, and, as far as we can see to-day, is the most advanced method and liable to produce the best results. Collective bargaining and voluntary arbitration are possible, however, only when the employer recognizes the right of the employed to have a voice in the fixing of wages and terms of employment."
"In the spirit of fair play," says Mr. Brooks, "he asks the simplest question: 'If these billions of capital have to be organized to protect themselves against disputing rivalries, do not the laborers working for these organizations have the same need of combination? Do they not need it for the same reason? Is capital exposed to cutthroat competition in any greater degree than labor is exposed to it? How can capital have the face to ask for combination, in order to free itself from a murderous competition, when labor suffers every whit as much from the same cause?' I have heard Baldwin," his biographer goes on, " very eloquent on this subject. The deepest thing in him was his sense of justice. He felt it like an insult that the more powerful party should stoop to ask such odds against the weaker and more defenseless party." "' We men at the top,' said Baldwin, ' must have combination, we must have our representatives and " walking delegates." We have everything that powerful organization can ask, with the ablest lawyers to do our bidding. Labor, to protect its rights and standards, needs organization, at least as much as we need it. For capital to use its strength and skill to take this weapon from the working men and women is an outrage.'" And again: "' I need, as an employer, an organization among my employees, because they know their needs better than I can know them, and they are therefore the safeguard upon which I must depend in order to prevent me from doing them an injustice.'"
This is getting right at the nerve of the whole matter. No wiser, braver, saner words were ever spoken. The labor question will be speedily settled when such a spirit of justice and fair play, such a recognition of the elemental rights of manhood, gets possession of the hearts of employers. Of the habit of mind which cannot concede so much as this one can say nothing better than that it is unsportsmanlike. We give even the wild creatures a chance for their lives; and so long as the industrial struggle continues, the chivalrous employer will not insist that his employees shall go into the contest with their hands tied behind them.
Beyond this question of personal honor between employer and employee is one that touches very deeply the foundations of our social structure. "If capital refuses to labor what capital asks and takes for itself, what are the final consequences of that injustice? How, in the long run, is labor to take this defeat of what it believes to be its rights? Those capitalist managers really hostile to the unions said to him in excuse that the unions checked and hindered the development of business prosperity. Baldwin had his answer: 'Even if that is true, it is better to get rich at a somewhat slower pace than to make millions of wage-earners lose faith in your justice and fairness.'"
Is it too much to expect that our captains of industry will give sober heed to words like these, spoken by one of their own number?
It is not, however, necessary to assume that the democratization of industry will prove any serious obstruction to the healthy growth of business. If the trade unions have often shown themselves to be tyrannical and greedy, we must remember that they have been fighting, thus far, in an arena where belligerent rights were denied them; it is not to be wondered at that they have sometimes taken unfair advantages. When their rights are fully recognized, better conduct may be looked for. So long as they are treated as enemies it is not logical to ask them to behave as friends.
It would be interesting to study the origins of those trade unions which have made trouble for employers. The cases are not all alike, but in many instances something like this has happened: Some dissatisfaction on the part of the men has shown itself, and it becomes known to the employer that steps are being taken for the organization of a union. At once his displeasure is manifested. He feels that the action is hostile to his interest; his entire attitude toward it is unfriendly from the start. It becomes well understood among the men that those who join the union are exposing themselves to the ill will of the employer; that those who refuse to join may expect his favor. Thus the interests of the men are divided, and the non-unionist contingent is fostered by the manager as a force to check and defeat the unionists in the event of a struggle. Under such circumstances bad temper is generated on both sides, and the relations of all parties are badly strained. The manager refuses to recognize the union; that, he insists, would be an injustice to the loyal men who have refused to join it. If a union with such a history should prove to be a disturbing and refractory element in the business, it would not be a miracle.
Suppose, now, that when the first signs of an uprising among the men appear, the employer, instead of treating it with suspicion or hostility, welcomes it. Suppose that he goes out among the men and says to them, what Baldwin would have said: "Certainly, men, you must organize. I mean to treat you fairly, but I do not want you to be dependent on my favor; I insist that you shall have the power to stand for your own rights. And I want all the men in this shop to join this union. No man will curry favor with me by staying out of it. I am going to be friends with the union, and I expect the union to be my friend. This is not my business, not your business, it is our business. I shall study your interest and you will study mine; we will consult together about it all the while; I think we can make it go together. If you ask me for what I cannot give, I shall tell you so. And I hope you will learn to believe that I am telling you the truth. I shall stand for my rights if you are mean and unreasonable, and you will stand for yours if you think I am unjust, but if we must fight we will stand on the level and fight fair. I hope that there will be no fighting."
Now, it is possible that a group of American workingmen could be found who would make trouble for an employer who took that attitude and consistently maintained it, but I do not believe that there are many such groups. It would be visionary to expect that any method which man could devise would wholly remove friction and discontent, and a strong and firm hand would often be needed in carrying out such a purpose as this, but one may confidently predict that peace and prosperity are made nearer by this approach than on the lines of industrial feudalism.
It will be observed also that such a line of policy eliminates the question of the closed shop. If the employer wishes all his employees to belong to the union, and makes it clear that union men are favored, the reason for a closed shop practically disappears. The employer's reason for an open shop is his need of a force near at hand to fight the union; when he makes the union his ally instead of his enemy, non-unionism becomes both to him and to his men a negligible quantity. The man who takes up a purpose of this kind, whether he is proprietor or general manager, cannot be guaranteed an easy job. It will not be possible for him to turn it over to subordinates; he will have to keep close to it himself. It will call for labor, for self-control, for faith in men, for all the best qualities of mind and heart. Neither in the State nor in the factory will our democracy be fulfilled without patient, heroic, self-denying work. But the work will be rewarding. Can any compensation be higher or finer than that of the man who wins, as Baldwin won, the loyal affection of scores or hundreds or thousands of men; who helps them to stand on their own feet and work out their own fortunes; who makes them see that the industry by which they gain their livelihood is one in which they have a real stake, so that they are not merely dependents on it, but, in a true sense, partners in it; who sees growing up around him a community of friendly men with some sense of the dignities of manhood and the responsibilities of citizenship? No vocation can be more sacred than this, and no reward more satisfying.
(1) " An American Citizen." By J. G. Brooks. Houghton Mifflin Company, Boston.
This work is in the public domain in the United States because it was published before January 1, 1929.
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