Omaha daily bee., 1919-08-20
Picking the Manager
From The Saturday Evening Post.

From The Saturday Evening Post.
Most of the unrest in the world SINNERS
down to this: People want higher wages and
cheaper products of labor shorter working
hours and more goods. With many of the
demands of labor everybody smypathizes. The
trend of wages measured in purchasing power,
should be upward, not downward for down
ward trend involves hardship and degradation
to many; and hours of labor should tend to
shorten not engthen. With the demand for
more abundant and cheaper goods everybody
sympathizeS; but great part OF the cost of
all goods finally resolves itself into wages, or
the cost of the labor.
Some wordmongers offer an easy solution
namely, just appropriate capital and CAPT.
talists But intelligent and candid socialists
know that is not a solution. John Spargo,
for example, says:
Every serious student of the problem has
realized that the first great task of any So
ciast society must be to increase the pro-
ductivity of labor. 1t is all very we'll for
popular propaganda among the masses to
promise a great reduction in the hours OF
labor and at the same time a great improve
ment in the standards of living The trans
latlon OF such promises into actual achieve
ment must prove an enormous task 10 build
the better homes make the better and more
abundant clothing, shoes, furniture and other
things required to fulfill the promise will re-
qure great deal of labor and such an organi-
zatlOn OF industry upon a basis of efficiency
nation has yet developed.
IF the working class of this or any other
country should take possession of the existing
organization Of production there would not be
enough in the fund now going to the capital
1st class to satisfy the requirements of the
workers, even II not penny OF compensation
were paid to the appropriated owners. Kaut-
sky, among others. has courageously faced this
fact and insisted that it will be one of the i'm
ratju tacl- of the NJ 1utio
ply to continue, but also to increase produc
ton: the victorious proletariat must extend
production rapidly if it is able to satisfy the
enormous demands that will be made upon the
new regime
For intelligent and candid socialists, as we'll
as for all other serious students, the only sou- |
ton finally is greater production, higher indus
trial efficiency. Now the efficiency of any in
dustrial unit depends first of all upon the
ability of the management-of the directing
mind or minds Whether it is a great railroad
system or a corner fruit stand, picking a capa-
bic manager is the first step toward getting
that unit to function properly. Without that
step no other steps will answer.
The captastic system of individual COM
pettive ownership is not only the best scheme
that ever has been devised for picking capable
managers but it is the best scheme to that end
that ever can be DEVISED for under it the re-
upon good management, while bad manage
ment Immediately and automatically entails
heavy penalties. set of stockholders, whose
money is invested in the undertaking. choose
the management Their profits depend upon
a right choice. If they choose wrongly they
lose their money. Naturally, then, the CAPT
tastic system tends with all its force to the
development and discovery of able managers.
To anyone acquainted with its day-by-day
workings it often seems nothing else than a
trelesS Unsuitable hunt for capable men. But
under the acid test of the capitalist system
the man must actually make good; he must de-
liver the goods not in phrases but in unemo-
tional cost sheets.
Under any scheme of public, socialist or
collective ownership and direction of industry
there would be no such acid test and no such
automatic penalties for poor
agement. When stockholders bad judg
ment in choosing the management of a rail
road or mill, deficit wipes them out. They
are naturally mighty anxious to avoid deficit.
If the public owns the railroad or mill deficit
is charged off to the public treasury explained
away in plausible phrases, and nobody expert
enceS any acute personal inconvenience. Every
scheme of public, socialist collective owner
ship and direction finally comes to that; there
is no big individual reward for good manage
ment, no acute individual penalty for bad mani
agement-unless, of course. it eventually comes
to bolshevist case, where collectvism so de-
ferS acute penalties.
Compare almost any time the last 80 years
the management of the city of New York. the
city OF Chicago and the city Of Philadelphia
with the management of the biggest national
bank in each city. If the banks had been run
as the cities were some severe personal penal
ties would have resulted. The penalties for
bad management of the city's affairs were diff
fused among great number of people: no in
iividual was very sensible of them. The bank
scheme Immediately rewards good manage
nent; Immediately Furnishes bad management
No better scheme for the discovery and devel-
opment of good management can be devised
There is real struggle throughout the Old
Norld--with many echoes here-over the final
direction and management Of industry. The
lub of it is whether the managers of industry
shall be chosen by stockholders, by the pub
ic-meaning the political government-or by
he body of workmen employed in the indus
ny; or perhaps jointly by the government and
he worknen. In England just now it RACES
ound naturalization of coal mines and rail-
Dads. An American phase develops in the
,roooc,1 ~ +ha r,;ro,d h-otherhoodc