Life like a dome of many-coloured glass Stains the white radiance of eternity Until death shatters it to fragments.

A unity there is, but it is the unity of the countless and varied flowers that carpet the meadows in spring, the unity of the common spirit of life which animates them all.

BOOKS FOR REFERENCE

Leach, The Schools of Medieval England. Methuen.

Mullinger, J. Bass, The Schools of Charles the Great.

Paulsen, Geschichte des gelehrten Unterrichts.

Rashdall, Universities in the Middle Ages. Clarendon Press.

Foster Watson, Grammar Schools. Cambridge University Press

Woodward, Erasmus. Cambridge University Press.



IX

COMMERCE AND FINANCE AS INTERNATIONAL FORCES

Commerce and finance are departments of life in which mankind approaches nearer to unity than in any other. They are practical expressions of the instinct of self-preservation which is the first law of nature. They spring straight from the acquisitiveness which is a universal characteristic of human nature and indeed of animal and vegetable nature. Every living thing wants to acquire food. Adam Smith indeed restricts the trading instinct to mankind. 'The propensity', he says, 'to truck, barter, or exchange one thing for another ... is common to all men and to be found in no other race of animals, which seem to know neither this nor any other species of contracts. Two greyhounds in running down the same hare have sometimes the appearance of acting in some sort of concert. Each turns her towards his companion or endeavours to intercept her when his companion turns her towards himself. This, however, is not the effect of any contract, but of the accidental concurrence of their passions in the same object at that particular time. Nobody ever saw a dog make a fair and deliberate exchange of one bone for another with another dog.'[24]

Mr Cannan, in his edition of the Wealth of Nations, very judiciously points out in a note on this passage that 'it is by no means clear what object there could be in exchanging one bone for another'. Probably if one rummaged the literature of dog stories one would find plenty of examples of commerce between dogs, and when they perform tricks to get food, we detect the germ of the exchange of a service for a commodity.

When a bee takes honey from a flower and leaves in exchange the pollen from a flower of an opposite sex, it may be said to be at once a merchant, a carrier, and a matrimonial agent, and the brilliant colours with which flowers attract these merchants have been compared to the advertising posters of the human trader. But however the case may be in the animal and vegetable world, there can be no question that the trading instinct appears at a very early stage of human development. In boys the instinct to trade or swop articles appears long before they feel any inclination to fall in love or to give much serious thought to religion. The classical example is given by Mark Twain, who relates how Tom Sawyer exchanged one of his own teeth, which had been pulled out that morning, for a tick in the possession of Huckleberry Finn, and then 'the two boys separated, each feeling wealthier than before'. In fact, of course, they both were wealthier than before, because each had got something that he wanted more than the article with which he had parted; and this pleasant result sums up the whole genesis and basis of commerce.

But though commerce is thus merely an expression of an instinct which is primitive and universal, it does not follow that it is its only or even its earliest expression. Perhaps its earliest and most natural expression was through robbery, with or without violence. A primitive savage who saw something that he wanted would probably, if strong enough, hit its owner on the head and take it, and this short and simple method of acquisition still occasionally reappears in the realms of the most highly civilized diplomacy. Nevertheless, at a very early stage its limitations became obvious, and quite at the dawn of recorded history we find commercial transactions referred to as an established branch of human intercourse. The Old Testament story has not gone far before it tells us of buying and selling. In the twenty-third chapter of Genesis we find a very interesting bargain recorded between Abraham and Ephron. Sarah had died in Kirjath-arba:

'the same is Hebron in the land of Canaan: and Abraham came to mourn for Sarah, and to weep for her. And Abraham stood up from before his dead, and spake unto the sons of Heth, saying, I am a stranger and a sojourner with you: give me a possession of a buryingplace with you, that I may bury my dead out of my sight. And the children of Heth answered Abraham, saying unto him, Hear us, my lord: thou art a mighty prince among us: in the choice of our sepulchres bury thy dead; none of us shall withhold from thee his sepulchre, but that thou mayest bury thy dead. And Abraham stood up and bowed himself to the people of the land, even to the children of Heth. And he communed with them, saying, If it be your mind that I should bury my dead out of my sight; hear me, and intreat for me to Ephron the son of Zohar, that he may give me the cave of Machpelah, which he hath, which is in the end of his field; for as much money as it is worth he shall give it me for a possession of a buryingplace amongst you. And Ephron dwelt among the children of Heth: and Ephron the Hittite answered Abraham in the audience of the children of Heth, even of all that went in at the gate of his city, saying, Nay, my lord, hear me: the field give I thee, and the cave that is therein, I give it thee; in the presence of the sons of my people give I it thee: bury thy dead. And Abraham bowed down himself before the people of the land. And he spake unto Ephron in the audience of the people of the land, saying, But if thou wilt give it, I pray thee, hear me: I will give thee money for the field; take it of me, and I will bury my dead there. And Ephron answered Abraham, saying unto him, My lord, hearken unto me: the land is worth four hundred shekels of silver; what is that betwixt me and thee? bury therefore thy dead. And Abraham hearkened unto Ephron; and Abraham weighed to Ephron the silver, which he had named in the audience of the sons of Heth, four hundred shekels of silver, current money with the merchant.'

In this very early and curious example of a bargain we find the seller continually expressing reluctance to sell and asking the buyer to accept as a gift the commodity that he wants. It appears from the sequel that this is merely an example of Oriental politeness. At any rate, the end of the bargain was that Abraham paid the money, four hundred shekels of silver, which is described as 'current money with the merchant', thus apparently showing that this system of payment in metals was already a regular feature of commercial transactions. Coined currency had not yet been developed, for we may note that Abraham weighed the silver.

When we come to the days of Solomon we find something like a developed international trade. The fifth chapter of the first book of Kings describes how Solomon, on taking the throne of his father, sent to Hiram, king of Tyre, and stated his purpose to build a house unto the name of the Lord his God, asking Hiram to send his servants to hew cedar trees out of Lebanon, and saying that he would give hire for Hiram's servants according to all that he should appoint. Hiram replied that he would do all that Solomon desired concerning timber of cedar and concerning timber of fir. 'My servants shall bring them down from Lebanon unto the sea: and I will convey them by sea in floats unto the place that thou shalt appoint me, and will cause them to be discharged there, and thou shalt receive them: and thou shalt accomplish my desire, in giving food for my household. So Hiram gave Solomon cedar trees and fir trees according to all his desire. And Solomon gave Hiram twenty thousand measures of wheat for food to his household, and twenty measures of pure oil: thus gave Solomon to Hiram year by year.'

According to this arrangement it would appear that Solomon paid for the timber that he imported by exporting to Hiram wheat and oil, but it is shown in a later chapter that the transaction was not a purely commercial one. At the end of twenty years, when Solomon had finished the building of the temple, he gave Hiram as further consideration twenty cities in the land of Galilee, 'and Hiram came out from Tyre to see the cities which Solomon had given him; and they pleased him not. And he said, What cities are these which thou hast given me, my brother? And he called them the land of Cabul [explained in the margin as meaning "displeasing" or "dirty"] unto this day. And Hiram sent to the king sixscore talents of gold.'[25]

Apart from this transaction between the two kings, Solomon appears to have developed a very considerable foreign trade, presumably exporting wheat and oil and other agricultural products. His imports appear to have been various. Chapter ten of the first book of Kings states that 'the king had at sea a navy of Tharshish with the navy of Hiram: once in three years came the navy of Tharshish, bringing gold, and silver, ivory, and apes, and peacocks.' ... 'And the king made silver to be in Jerusalem as stones, and cedars made he to be as the sycomore trees that are in the vale, for abundance. And Solomon had horses brought out of Egypt, and linen yarn: the king's merchants received the linen yarn at a price.'

The whole question of Solomon's balance of trade is a very interesting one, and deserves the attention of some Hebrew scholar who may be able to throw light upon it. In these days it is rather difficult to see how a purely agricultural country could have found the means of paying for all these articles of pure luxury which Solomon imported so freely. It must be noted, however, that 'all the earth sought to Solomon, to hear his wisdom, which God had put in his heart. And they brought every man his present, vessels of silver, and vessels of gold, and garments, and armour, and spices, horses, and mules, a rate year by year'. From this it appears that Solomon was able to exchange his wisdom for a very considerable part of the imports which came into his country, and so perhaps we may take it that Solomon's wisdom is the earliest recorded example of what is now known as an invisible export. A modern equivalent would be the articles which English writers contribute to American newspapers and are paid for, ultimately, by the shipment to England of American wheat and cotton. It is also interesting to note in these days, when personal economy and simplicity of life are so freely preached, that Solomon's very luxurious imports were followed by evil consequences, imports of an enormous number of strange women, and a consequent turning away of his heart after false gods.

When we come to secular history, the very first chapter of the first book of the first history ever written deals with a question of commerce. Herodotus, who has been called the Father of History, opens his work with a few introductory words stating that 'these are the researches which he publishes in the hope of thereby preventing the great and wonderful actions of the Greeks and Barbarians from losing their due meed of glory, and withal to put on record what were their grounds of feud'. And then he plunges straight into his story, as follows: 'According to the Persians best informed in history, the Phoenicians began the quarrel. This people, who had formerly dwelt on the shores of the Erythraean Sea, having migrated to the Mediterranean and settled in the parts which they now inhabit, began at once, they say, to adventure on long voyages, freighting their vessels with the wares of Egypt and Assyria. They landed at many places on the coast, and among the rest at Argos, which was then pre-eminent above all the states included now under the common name of Hellas. Here they exposed their merchandise, and traded with the natives for five or six days; at the end of which time, when almost everything was sold, there came down to the beach a number of women, and among them the daughter of the king, who was, they say, agreeing in this with the Greeks, Io, the child of Inachus. The women were standing by the stern of the ship intent upon their purchases, when the Phoenicians, with a general shout, rushed upon them. The greater part made their escape, but some were seized and carried off. Io herself was among the captives. The Phoenicians put the women on board their vessel, and set sail for Egypt. Thus did Io pass into Egypt, according to the Persian story, which differs widely from the Phoenician: and thus commenced, according to their authors, the series of outrages.'[26]

Commerce is thus a striking example of the unity of mankind, being a practically universal form of human activity which arises as soon as man verges from the earliest stages of barbarism. In the case of individuals it is easy to see how this desire to exchange commodities between one individual and another meant so great an increase in human efficiency that it had only to be thought of to be universally adopted. The primitive savage, doing everything for himself, building his own hut, killing or finding his own food, and making his own clothes, such as they were, was an extremely versatile and self-sufficing person. At the same time the comforts that he enjoyed were probably not very satisfactory. His hut was almost certain to be draughty and to let in rain through the roof; his hunting and finding of food must have very often left him with his larder empty, and the state of his wardrobe was probably simple rather than satisfying. It would inevitably happen that certain members of the tribe would show greater efficiency than others in doing a certain one of these various businesses which are essential even to the simplest form of human life. Thus the tendency to specialization begins to show itself. The skilful hut-builder builds huts not only for himself but for other members of the tribe; he acquires further skill by constant practice and the huts are more quickly built and better when finished. The other tribesmen, in effect, pay him by supplying him with a certain amount of food and clothes. The tendency for specialization would make very rapid progress, and it is easy to see how at a very early date and in the most primitive communities there would be bowyers, arrow-makers, and leather-dressers, and how various kinds of artificers would arise, supplying the wants of the community in some special line, and receiving from the community all the commodities which they required apart from those which they produced themselves. The individuals of the community thus become mutually dependent, and live by one another's production. Hence comes unity, and with it a fresh cause of disunion, owing to the likelihood of quarrelling over the exchanges effected.

As progress developed and the communities at a greater distance became acquainted with one another's wants and the various kinds of goods that certain districts supplied, this tendency to specialization and consequent exchange of goods would grow in an ever-widening circle. Instead of the tribe being a commercial unity, the zone in which the interchange of goods went on would widen as far as the geographical and other boundaries allowed it. In the same country one district would be found to be specially well adapted for agriculture, and another for pasture; another, being well supplied with metals, would naturally provide a race of smiths and producers of rough tools for industry, and the exchange of commodities between districts with these various capacities would mean that the specialization of production would go steadily further, and that a whole town or village would be found in which the great majority of the inhabitants were at work upon one particular form of industry, relying for the other kinds of commodities that they required upon the activity of a similar community living in the next valley or on the other side of the river. This widening-out process would naturally extend itself over the borders of different countries. Obstacles to this process would be found in the differences of language and probably in the difficulties of transport. On the other hand, it would be greatly stimulated by the different ideas of value that prevailed in different communities. Value depends upon the extent to which anybody wants a thing, also on what he thinks it is worth, that is to say, the number of commodities in his possession with which he is prepared to part in order to secure it. Obviously commodities coming in from foreign countries, and being unknown or rare in the country in which they are offered, if they are otherwise at all attractive, possess a certain amount of what is called scarcity value, which makes them easily saleable by adventurous merchants who arrive with the cargo.

The stories of fortunes made by merchants who travelled among simple native tribes with cargoes of glass beads and were able to exchange these gaudy baubles for gold or rubber or other commodities which are valuable in civilized countries, have often been told, and opportunities for trading of this kind must have been very much more frequent when communication was comparatively difficult. Value to a great extent being determined by local convention and local habit, the profits of the trader were likely to be considerably increased the further he got from his home market. If he took away with him plenty of things which were in abundant supply at home and consequently cheap, he would almost certainly be able to bring back a large number of things which were plentiful in a far-away community, and consequently cheap for him to acquire, and scarce in his own district and consequently sure of a good market. This difference of standard of value in different countries was a great stimulus to foreign trade, also a great help to bringing mankind together, though it sometimes ended in disillusionment. It has been asserted that even within the memory of man an English merchant traded with a primitive community in which gold and silver were exchangeable weight for weight. For some years he did a very pleasant and profitable trade by taking a cargo of silver and bringing back with him the same weight in gold, the value of which in England happened to be sixteen times as great, or more. Unfortunately, when he made his last voyage he was met at the mouth of the river by a friendly native, who informed him that the community was waiting for him with tomahawks, and he hastily put to sea again. For the rest of his life he cherished a grievance against this curious people with which he had dealt, according to his own view, on perfectly equitable terms, having sold them a commodity at a price to which they were accustomed, and which they regarded as quite correct, with the result that they proposed to murder him because they found that the price was not in accordance with that current in other parts of the world.

By this business of exchange of commodities between one community and another, the process of specialization or division of labour which has already been referred to as its basis has been developed to extraordinary lengths. Its effect has been to increase enormously the wealth available, while at the same time the concentration of the individual has narrowed down his work so that he now no longer specializes on making one commodity, but on making a part of a fraction of a commodity.

Adam Smith's chapters on division of labour are so well known that there is no need to point out the very great economic benefits that arise from it. Clearly, any man who spends all his working time upon one particular process of productive activity acquires thereby a skill and rapidity in carrying out his part of the operation which would be impossible to any worker who has to carry the manufacture of an article from the beginning to its end. Just as we saw, when the primitive savage left off doing everything for himself and took to building huts for the rest of the community, that the huts became much more water-tight and comfortable, so the process goes still further, and building becomes very much more rapid and very much more cheap and efficient when a large number of specialists are set to work on the various very different processes required for the construction of a house. The consequence is that the production of goods is very greatly cheapened and made much more rapid, but at the same time the worker tends to become an artisan instead of a craftsman, and his work is likely to be much more monotonous and much more trying. Instead of seeing his product grow under his hand from its beginning to its end, with constant changes in the nature of its call on his energy and care, he is employed during the whole of his working time on some mechanical process, with the result that he himself becomes something very like a machine. What he has gained in the power to make and acquire commodities cheaply and quickly is offset to a certain extent by the less interesting and varied nature of his work.

It also follows that as the worker becomes a specialist he becomes dependent upon other members of the community for the supply to him of a large number of things which he requires for his own existence. If he spends his life in making one commodity or in making part of one commodity, it is clear that his requirements of all the things that are necessary for life apart from what he makes himself can only be satisfied by the willingness of the community to take the commodity that he makes in payment for those which it produces and of which he is in need. When he works for himself, he only makes things that he knows himself to need; when he works to sell to others, he has to speculate on the hope that the others will want what he makes.

Commerce thus not only shows the unity of mankind by being a universal feature of his existence, but increases that unity by making each individual dependent upon the exertions of his fellows, and on their willingness to take from him stuff which he is turning out; but if commerce thus promotes unity, it also tends to create a certain amount of friction and disagreement between one man and another when differences of opinion arise concerning the value of the product which each man is making, that is to say, concerning the amount of goods which the rest of the community is prepared to give him in exchange.

This consideration is also very strongly evident with regard to international trade. Here the division of labour is assisted by the difference in the products of different countries. There can be no doubt that the exchange of commodities between one nation and another tends to bring them together and to promote unity and harmony of interests. At the same time it is also likely to be fruitful in quarrels and bickering. We saw that Hiram was very much dissatisfied with the cities in Galilee which Solomon presented to him in the course of their semi-commercial transactions. He appears to have retaliated by making Solomon a very handsome present in gold; but Hiram seems to have been a very exceptional person, and it is probable that most traders who are dissatisfied with the consideration received would not have been so generous in expressing themselves.

International commerce has also been a fruitful cause of disunion rather than unity when various nations have quarrelled with one another concerning the right to trade with a third people. If one nation is trading with another greatly to its profit, it feels that it has a grievance when it finds that a neighbouring nation is sending cargoes to the same destination and undercutting it and taking the cream of the trade. After religion, it is probable that trade has produced more bloodshed than any other form of human activity. At the same time there can be no doubt that on the whole its influence has been strongly on the side of unity and that it has done more to break down international barriers than any other influence that has operated in the course of history. The trader, as such, believes entirely and whole-heartedly in the unity of mankind. All that he wants to do is to buy his products as cheaply as he can and to sell them at the best possible price. Whether he buys at home or abroad, or whether he sells at home or abroad, is a matter of complete indifference to him except that, as has been shown, owing to variations in value in different parts of the world, he is probably likely to be able to make larger profits from foreign trade than in commerce at home. National preferences sometimes induce him to encourage home industry by buying home products when foreign goods would have paid him better, but in so far as this happens, he ceases to be a trader as such and becomes a mixture of trader and patriot. As buyers and sellers, however, mankind is, on the whole, singularly free from international prejudices. It was thought at one time that importation of foreign goods into England would be considerably checked by insisting upon marks of origin, that is to say, that imported goods should be stamped as such. This expectation, however, seems to have been entirely disappointed, since most buyers were not concerned with the question of the country whence the commodity that they bought came, and only considered whether it suited their purses and was what they wanted. Sometimes there is actually a prejudice in favour of foreign goods, and, curiously enough, this is found to be so even in countries in which a protective policy has been very highly developed. It is, or was a few years ago, common to see in American newspapers, flaming advertisements heralding sales of imported goods, which were definitely stated to be such obviously because the sellers thought that they were likely to be able to sell them better because they were stated to be so. It is also a proud boast of English manufacturers that in many countries on the Continent it is common, or was until quite lately, for native manufacturers to sell their goods more easily in their home markets by describing them as English. Political and national prejudice seems to be overruled by the common human desire for something new and strange, and consequently, in spite of all friction that has arisen from international trade, and of the number of wars which have had their origin in commercial questions, there is good reason for the assertion that on the whole commerce has been a mighty promoter of intercourse among the nations and of the unity of mankind. If it had not been for commerce, the cheapening and quickening of communication could never have been carried out. The trader goes first, and after him the traveller and the tourist.

This claim can be made with perhaps even more certainty when we proceed to the realm of finance. If commerce is international and unifying, finance is perhaps even more so. Finance, of course, arises out of commerce and is an essential part of its machinery. By finance we mean the machinery of money—money-dealing and money-lending. Money becomes necessary as soon as the exchange of commodities, which is the meaning of trade, becomes fairly developed. At first, primitive peoples exchanged their commodities one for another, but a difficulty arose when out of a pair of possible traders one had something which the other wanted but the other had not. For example, if the arrow-maker had arrows to sell and wanted to buy fish, there obviously could be no bargain if his friend who wanted to buy arrows had only got deerskins to give in exchange. It was essential to the development of trade that some commodity should be hit on which could always be taken in exchange and so form a circulating medium. We have seen from the twenty-third chapter of Genesis that a certain weight of silver had in Abraham's time begun to assume this function. Economic text-books tell us that many other commodities had the form and function of money before the metals came into use. Until quite lately there were many places in which the use of an agreed medium of exchange had not been adopted to facilitate the purposes of commerce. Jevons begins his very interesting book on money by relating how

Some years since, Mdlle Zelie, a singer of the Theatre Lyrique at Paris, made a professional tour round the world, and gave a concert in the Society Islands. In exchange for an air from Norma and a few other songs, she was to receive a third of the receipts. When counted, her share was found to consist of three pigs, twenty-three turkeys, forty-four chickens, five thousand cocoa-nuts, besides considerable quantities of bananas, lemons, and oranges. At the Halles in Paris, as the prima donna remarks in her lively letter, ... this amount of live stock and vegetables might have brought four thousand francs [L160], which would have been good remuneration for five songs. In the Society Islands, however, pieces of money were very scarce; and as Mademoiselle could not consume any considerable portion of the receipts herself, it became necessary in the meantime to feed the pigs and poultry with the fruit,'[27] and so her receipts consumed one another.

This is an example of the inconvenience which the invention of money overcame. In primitive communities it took the form of cowry-shells or tobacco or gunpowder or any commodity which was in universal request in the place. All the seller wanted to do was to be able to obtain for his product a certain amount of stuff which he could rely on being able to exchange for other things that he wanted. In the end the precious metals, with their strong appeal to human vanity, and their utility for adorning temples and so propitiating divine favour, ousted all other commodities which had been used for money; and they are now to a great extent ousted by pieces of paper, which still, however, represent claims to so much gold.

The discovery of a circulating medium enormously facilitated the progress of commerce, and it was not long before a class of people grew up who specialized in this particular form of business and became financiers and moneylenders. Bankers and financiers were known in Rome and Athens, and we know that some machinery existed by which the monetary claims of one country on another could be settled by something that fulfilled the functions of the modern bill of exchange. The actual provision of metallic currency has from the earliest times been almost entirely under the control of the government which took into its own hands, as an essential part of the police protection which it gives to the people, the coining of currency, stamping the coin in such a way that anybody who took one might know that he was getting a certain weight of a precious metal. But the money-dealing business very soon developed the machinery of credit by which anybody who had an enterprise or a venture out of which he expected to make an attractive profit could, if he had sufficient property to pledge, provide himself with the means to finance it between the day that he started on his operations and the day when he brought home his profits: and this business also became international, though not, perhaps, as rapidly as commerce had overstepped the boundaries between one people and another.

In the Merchant of Venice we find Antonio trading with all the countries of the then known world,

From Tripolis, from Mexico, and England, From Lisbon, Barbary, and India,

but we do not find that Shylock was lending money on at all the same international scale. When communication was slow, difficult, and untrustworthy, money-lending at a distance was made very risky, because it was impossible for the lender to keep the watchful eye on the borrower's operations and credit that is required if he is to feel comfortable in his venture. For a Lombard Street banker to lend money to a merchant in Cheapside payable at a year hence was, until comparatively lately, a much safer enterprise than to lend it to a merchant in Paris, because the local borrower was always under the lender's observation. If he were overtrading or living on too lavish a scale it would at once be noticed and reported.

Nevertheless, international finance made steady progress through somewhat obscure beginnings. We know that Philip II of Spain was heavily indebted to moneylenders all over the Continent, and that by his famous repudiation he carried consternation throughout Europe.[28] Edward III was also heavily indebted to Florentine bankers, and he also omitted to pay his debt; and it is said that the descendants of the Florentine bankers still have a claim against the English Crown in consequence[29]; but it was not until after the creation of stock exchanges and the machinery of a public market in securities that international finance became a question of general importance.

Here also the effect has been for unity combined with a good deal of disunion. Twenty years ago it used to be said that feeling in the Western States of America was very strongly anti-English because most of the Western farmers were indebted to English moneylenders, and on the whole it may be said that the relations between the borrower and lender are not likely to be so friendly and so likely to promote unity as those between buyer and seller. There is really no logical reason why this should be so: the basis of the bargain between the two is exactly the same. In commercial transactions one man sells to another because the other man wants something that he has got more than he does. It is exactly the same with the borrower and lender of money. A man borrows because he wants money and is prepared to pay a rate of interest for it. The lender lends because he has money to lend and wants to earn interest on it. Nevertheless there is something in this relationship which seems to produce discord. It is not many years since the Australian newspapers used to talk of England as John Bull Cohen, implying that the English money market made more than it ought to do by developing, with the help of its financial resources, the production and commerce of the young countries of the world. Perhaps it is human to feel a grudge against a creditor, because the money has to be paid back, whereas a commercial bargain is done with. Nevertheless, after allowing for all the friction that money-lending seems to produce, there can be no question that the establishment of the international market in securities has enormously widened the world's output of commodities, and it has greatly promoted that unity of interests which has brought mankind together more than anything else.

Englishmen are always supposed to be particularly insular. Nevertheless, any one who looks at the Official List daily published by the London Stock Exchange and sees the enormous number of Government and municipal loans from all parts of the world, the number of foreign railways, and the number of foreign enterprises of all kinds which are dealt in on the London Stock Exchange, cannot avoid the conclusion that this practice of investing money abroad, which has been followed here to a greater extent than in any other country, must have very greatly widened the Englishman's horizon and forced him to confess that at least from one point of view dwellers in foreign countries have some right to exist. At any rate, in practice English investors not only have shown that they do not recognize international barriers, but there have even been times when foreign securities have actually been preferred to English. A few years ago it was reported by stockbrokers that many of their clients would not invest money at home and insisted whenever possible that it should be placed abroad. To such an extent has this process been carried on that it is now calculated by statisticians that no less than four thousand millions of English money have been placed outside England, about one-half of this having been lent to foreign countries, and about one-half to our own colonies. Here again, as in commerce, there arises a possibility of quarrelling, not only between the lender and borrower but also between rival groups of lenders in different countries. When an economically backward country is being developed with the assistance of capital from nations which are at a further stage of economic progress, the moneylender is supposed to acquire a certain amount of political prestige and privilege which makes other nations, which have an eye to increasing their influence in the borrowing country, jealous concerning such operations. A curious example was presented not long ago by China. China wanted to borrow, and probably the only countries which had any genuine surplus of capital available for export were England and France. Nevertheless, owing to the political side issues involved, Russia, Germany, and the United States also all insisted on taking part in the business of lending money to China. China was compelled to borrow more money than it wanted, so that all these so-called civilized Powers could share in the operation, and the absurdity of the position was increased by the fact that some at least of the Powers which lent the money would have had to borrow it somewhere before they could do so.

This freedom with which England has furnished financial resources to the rest of the world is sometimes called in question as having had, or being likely to have, bad effects upon the activity of production at home. It is quite clear that the progress of international commerce and the division of labour among nations by which commodities of all kinds have been very greatly cheapened could not have been carried out if England and other comparatively far developed countries had not supplied the necessary capital for the development of the relatively backward parts of the earth. If English money had not gone into building railways in America, Canada, Argentina, Australia, and all over the world, and supplying capital to the farmers and others who opened up these countries, food could not have been nearly as cheap as it is or as it was before the war, and clothes and other necessaries of life would have been at a very different price. In fact, it may be said that if England had not acted as she has, as the world's financier, the development of the world's trade to anything like its present scale would have been altogether impossible. If we could feel sure that the distribution of the world's production had been as satisfactory as the wonderful increase in its output, there would be no question that all classes in England had been very greatly benefited by its financial activities abroad. As it is, it is sometimes argued that English capital going abroad stimulates production in other countries and increases the demand for labour there, but that the demand for labour in England and its reward might have been on a higher scale if English capital had been kept at home. This is a question which is, happily perhaps, outside my province at present, but it is one which demands serious attention. This much can be said, that the years in which English capital has gone abroad with the greatest rapidity have also been those in which our export trade has been most active, and it is obvious that this must be so, because when England exports capital it does so in the form of lending money either to a foreign Government or to a foreign municipality, or to some company, English or foreign, which is conducting some enterprise in a foreign country.

In whatever way the money is lent the result is that the country to which it is lent is given so much buying power in England and consequently its demand for English goods is to that extent stimulated. It does not follow, of course, that the whole amount of money that it borrows is actually spent in England. It is possible that the Canadian railway which is raising money in England may spend it by buying steel rails in Belgium, but in practical fact the net result is that somebody or other abroad is given a claim on England which finally, by some roundabout process, takes effect in a demand for English goods and services. At the same time, when one does admit that international finance is essential to international commerce and that the specialization, which is an essential product of commerce, is thereby quickened, we have to remember that the objections, such as they are, which can be put forward against the division of labour among individuals cannot be overlooked altogether when the division of labour is applied to nations.

Dr. Bowley, in his book on England's foreign trade, puts the matter dramatically as follows:—

The limit to the indefinite division of labour is to be found in the social, intellectual, and moral objections to specialization. It is not pleasant to contemplate England as one vast factory, an enlarged Manchester, manufacturing in semi-darkness, continual uproar, and at intense pressure for the rest of the world. Nor would the Continent of America, divided into square, numbered fields, and cultivated from a central station by electricity, be an ennobling spectacle.'[30]

This is a picturesque expression of the objections to the unity of mankind if carried too far through the process of specialization. While admitting their force, it is not necessary to admit that the specialization process need go quite to that length. Even if England became one vast factory, it need not necessarily follow that it must work in semi-darkness, continual uproar, or at intense pressure, but it is all to the good that a specialist of Dr. Bowley's eminence should call our attention to certain things which have to be guarded against. On the other hand, we may contend that if England became one vast factory, it would only do so because it paid it so well to do so, that that vast factory might be made more in accordance with William Morris's ideal than the picture of Inferno drawn by Dr. Bowley. We might imagine England one vast Garden City, dotted over with factories, each of which might be as beautiful as a cathedral, embowered and surrounded by fruit trees and gardens, in which a highly educated and technically trained population would work for five or six hours a day, and spend the rest of their time in intellectual leisure and healthy exercise and home life under ideally happy conditions.

It is interesting to note that the result of the present war is likely, if anything, to check the export of capital for a time, not only owing to the very obvious reason that for the present all our available capital is going into the war and for some time to come will have to go into expenses connected with the war, but also because this war has set a new precedent with regard to the duty of belligerents in the matter of making payments to one another. In olden times, when war was a gentlemanly business, trade and finance were very little interrupted by it. At the time of the Crimean War the Russian Government punctually paid the interest due on Russian loans to English holders and thereby established a prestige amongst English investors which was cherished for several decades. Now that nations have taken to going to war with tooth and nail, throwing their whole available population into the field and using every possible device, military, commercial, and financial, to beat their enemies, any such pleasant decencies as paying money due from one country to another in the shape of interest or otherwise have been abandoned. When the war is over it is possible that investors will remember this fact to a certain extent and will be more chary than they were before of investing their money abroad, at any rate in any country with which there is the remotest possibility of our being involved in war.

War has also shown the great inconvenience that arises when the mutual dependence of nations one on another for certain products leaves them crippled because international exchange is interrupted. International trade and finance, in their full and free development, have been shown to depend on the assumption that peace is secure. Unless the present war should be so ended as to secure peace for all time, it seems likely that all nations will aim at being able to rely, at least for the essentials of life and of defence, on home production or on a supply from countries with which war may be regarded as impossible. If this be so, then unity through trade and finance will be less universal, but more close-knit in its narrower scope.

BOOKS FOR REFERENCE

A.L. Bowley, England's Foreign Trade. Swan Sonnenschein.

C.K. Hobson, The Export of Capital. Constable.

W.S. Jevons, Money and the Mechanism of Exchange. Kegan Paul, Trench, Truebner & Co.

Smith's Wealth of Nations, chs. i-iv.

FOOTNOTES:

[Footnote 24: Wealth of Nations, Bk. I, ch. ii.]

[Footnote 25: 1 Kings ix.]

[Footnote 26: Rawlinson's translation.]

[Footnote 27: Jevons, Money as Mechanism of Exchange, p. 1.]

[Footnote 28: Motley, United Netherlands, ch. xxxiii.]

[Footnote 29: Thorold Rogers, Economic Interpretation of History, ch. xx.]

[Footnote 30: England's Foreign Trade in the Nineteenth Century, by A.L. Bowley.]



X

INTERNATIONAL INDUSTRIAL LEGISLATION

We have learned to look upon the doctrine of interdependence of classes within the nation as a truth self-evident to all eyes unblinded by wilful prejudice or ignorance of that disabling kind charitably defined by the Roman Catholic Church as invincible. To say that unemployment in the mills of Lancashire or the shipyards of the Clyde not only affects the happiness and well-being of cotton operatives and boiler-makers and the great businesses which are carried on by their means, but depresses the national vitality and puts a drag on the national energy throughout the kingdom—to assert that no people can be wholly strong and vigorous while any corner of its territory or any layer in its social strata remains in the possession of a group physically weak, mentally undeveloped, and morally below the standard of ethics which, as a people, it has tacitly agreed to accept as necessary, seems to many of us in these days to state truisms. Yet it is not so long ago that facts which we now presume to be familiar, at least to every undergraduate, were the dangerous discovery of the few who, in an age when people said 'Socialist' as Mr. Pecksniff said 'Pagan', had the temerity to point out, that in things human and political as in mechanics, a chain was and could be no stronger than its weakest link. Even now, in the reaction, often only half conscious, of the employing class against any force which tends to raise the employed to a social plane less removed from that on which they themselves move, in the genuine dislike of education, concealed under ceremonial phrases in days of peace but breaking into fire and fury when the natural man is roused by a touch of excitement, we can see how skin-deep in many cases is the general belief in the widely proclaimed creed that economically as well as spiritually, we are all members one of another. And if the truth of our interdependence as citizens has won acceptance slowly and grudgingly, because the facts that prove it lie other-where than on the surface, it is easy to understand that the interdependence which is international, resulting as it does from the meeting, and crossing, and twining in the web of national life of innumerable fine threads drawn from the utmost corners of the civilized world, has scarcely yet come within the consideration of the ordinary man as an influence from which he cannot escape, and with which, therefore, he is bound to reckon. That, doubtless, is why international movements in general arouse so little interest in the mind of the average reader of newspapers. He does not regard them as practical. The persons engaged in promoting them he defines as cranks, dividing them into two classes, of whom one may be dismissed as harmlessly absurd, while the other ought probably to be suppressed as dangerous.

The events of the first week of August 1914, where the interdependence of countries is concerned, might and did throw some light on the journalistic mirror into which civilized man looks morning by morning, but it was light of the crudest kind. The result of the illumination, in numerous instances, was only to make a great number of people reflect with astonishment on the number of things which this country is in the habit of purchasing from abroad, comment with indignation on her folly in not having made them all at home, and, when passion rose sufficiently high, express a resolution that, however deeply they might need the enemy's products, they would never buy any of them again. To do them justice, this was not the attitude of the men confronted with the actual difficulty of inventing substitutes for raw materials of which the source had suddenly dried up. Those who sat in factory offices ruefully contemplating models of goods to the making of which Germany, Belgium, and Austria had hitherto sent some indispensable contribution, did not, even while they set about inventing something that should replace this contribution, belittle what they had lost. They knew, and said, that while they were confident of producing a working substitute, they did not pretend to offer in every case the precise quality which seemed to be the special gift of the German, or Belgian, or Austrian trader. Perhaps it was not after all only sheer laziness on the part of the British manufacturer, and sheer lack of patriotism on the part of British governments which induced our commercial leaders to concentrate on one field of production and abandon another. To each nation, as to each man, his gift. Some realization of this law may have come instinctively to practical workers engaged in practical tasks.

If the organizers of production among us have not been forward in the past to promote international action in the matter of labour legislation, this is not from any failure to realize the effect of inequality of industrial conditions upon nations competing in the markets of the world. This effect was naturally greatest in cases where the countries concerned were geographically contiguous and engaged in direct rivalry with one another in respect of manufactures falling under the same trade category. Here is the perfect case of competition, in which any circumstance tending to lessen production on the one side is immediately counted as an advantage to the other. But the pressure is felt even where the territory of the rival is situated at the other side of the world, even where the article produced belongs to a different class of manufacture. In normal times long distance transport is easy and long distance freight rates cheap, so that the question of distance, although still to be reckoned with, is no longer a determining factor in the sum of consideration. Again, the network of prices which controls the ultimate cost of production of any finished article is so complex that it is difficult in many cases to rule out this or that set of industrial conditions in one country as being without importance for a given factory in another. The price of a pair of corsets sold retail in Paris may have been subtly influenced by a strike of smelters of iron ore in Silesia; and your china tea-set may be dearer to-morrow by reason of a sudden outbreak of foot and mouth disease among the herds of the Argentine. Quite naturally, therefore, it has come about that manufacturers, in opposing proposals to make existing labour legislation either more stringent in detail or wider-reaching in scope, have put forward, as their principal objection, the plea that such reforms in favour of the worker would place British industry at a disadvantage with that of countries where the action of the manufacturer remained comparatively unfettered. The distrust, as well as the dislike of long hours as a means of increasing production, together with the belief that healthy and pleasant surroundings conduce to the development of the worker's powers as well as to the satisfactory maintenance of his physical condition, has made remarkable progress among the more intelligent of the employing class since the twentieth century began. But there is still, in nearly every trade, a considerable mass of masters who rarely think and never experiment, who turn a deaf ear to the representations of their managers and foremen when these, coming into direct personal contact with the employed, take note of results due to over-strain which are invisible to the head of the business in his office, and who continue to suppose, with their fathers, that limitation of the working period necessarily restricts output and spells commercial loss. Such men, hearing that their own manufacture is produced, let us say in Russia, by men working twelve hours a day to their men's nine, and paid at a considerably lower rate than that which obtains in their own works, would certainly not dream of drawing any other conclusion than the, to them, obvious one that the result of this difference must be a lowered cost of production. Inquiries which should prove, as did those of Sir Alfred Mond's firm when confronted with such a case, that the cost of production per ton was actually higher under the long hour and low wage system would never be instituted by them, and their results, when made by others, leave them sceptical if not suspicious.

Recognizing this mental attitude in a large section of the business men of every country, and bearing in mind that, in order to secure the efficient administration of labour laws, the legislator must be able to carry with him at least the general consent of the majority of those employers to whose trades they apply, it becomes clear that if we would remove all objection to complete and adequate protective law for the workers we must first dispel the fear of the manufacturer that such law would handicap him unfairly in the international market. And what way so apt to this end as the bringing of his competitors under a law similar in character and as far as possible uniform in its provisions?

It is a proof of the prescience of Robert Owen that, even before he had succeeded in planting the first small seed which was to grow into the flourishing tree of British industrial legislation, he had grasped the necessity and formulated the demand for international action in the matter of Factory Laws. Owen's labours at home have, naturally enough, bulked so large in the estimation of historians and publicists in their writings on this subject, that the continental side of his activities has received comparatively little attention at their hands. Nevertheless his correspondence with European governments on the abuses and needs of industrialism as it existed in the early years of the nineteenth century are among the most remarkable he ever wrote; and his appeal to the Congress of the Holy Alliance in 1818 shows how thoroughly prepared he was to treat national reform as the first step to a system which should be international. Had the statesmen of his time, too busy in their making and unmaking of kingdoms to heed his arguments and appeals, turned their attention from those high matters (in which, after all, their achievement was for the most part neither brilliant nor beneficial) to the homelier details of their people's lives, social progress would have been indefinitely hastened, and we might have been spared the sorry spectacle of one industrial nation after another committing the blunders and painfully learning the lesson of its predecessors at the cost of much avoidable human suffering. For, in this matter of industrial legislation, as in many others, men are astonishingly slow to learn by example. Perhaps the most remarkable case in point that has occurred is that of Japan, at this hour still in course of being worked out before our eyes. Here we have a nation brimful of intelligence, quick of apprehension, with a genius for selecting from the polity and procedure of other States exactly those features best fitted to promote prosperity and efficiency and an unmatched power for assimilating and reproducing them in the form suitable to its own tradition of development, following the Western Powers along the crooked path of their early dealings with industrialism and allowing the very conditions which stunted and degraded the Lancashire cotton operative of the 'thirties to be created in the mills of Osaka.

Since the days of Owen ideals of industrial conditions have mightily grown and developed. This was inevitable, since the standards of social comfort and hygiene have undergone complete transformation during the last century. But the important points to note are, first, that it is not only 'reformers' who put forward these ideals, but that they have become to a large extent common to all classes of the people, and, secondly, that the raising of the standard which proceeded at a slow, irregular rate for, roughly speaking, a hundred years, quickening in one decade and remaining almost stationary during the next, is now proceeding with comparative rapidity. Already such a rate of mortality and sickness as was common in the trades technically called dangerous twenty years ago has come to be regarded as monstrous and would no longer be tolerated with patience. This acceleration in the raising of industrial standards is doubtless largely due to the conscious participation of the workers themselves in the business of providing for their own protection; but it may also be referred in some degree to a quickened conscience and a more intelligent appreciation of the importance of the manual worker in the national economy on the part of the public as a whole. The same movement has been taking place, in different degrees according to their differing circumstances, among the other industrial peoples of the Old World and the New. The quicker this advance on the part of some nations the more keenly was the failure of others to make progress in the same ratio felt by those belonging to the first group. An uneasy consciousness that the backward nations were beginning to constitute an obstacle to progressive domestic legislation on the part of the advanced nations began to manifest itself. It appeared that the lame ducks were setting the pace for the whole fleet, and it was seen that self-defence no less than concern for the welfare of the human race at large demanded the devising of some machinery by which the movements of these laggards should be quickened.

Thus, seventy years after Owen had appealed in vain to the Powers in session at Aix-la-Chapelle, a definite step was taken towards an international agreement directed to the benefit of the working classes of Europe. It must not be supposed that during this interval no inheritor of Owen's tradition had been found or that his doctrine had been altogether forgotten for want of a preacher. Now and again prophets arose who, if they did not share Owen's genius, were at least his equals in sincerity and energy. Dr. Ernst Francke, in the article reprinted from the Economic Journal of June 1909, which I have recommended for reference at the end of this chapter, names one of these devoted pioneers, Daniel Legrand, an Alsatian manufacturer who for thirty years did his best to induce France, Great Britain, Prussia, and Switzerland to agree on a minimum of industrial legislation. Some very useful work in the same direction was done, during the years following the Franco-German War, by a Belgian publicist; and in 1876 Colonel Frey, President of the Swiss Federal Council, took the first official step in the direction of international labour treaties, by a speech in the Council recommending that Switzerland should take the lead in an endeavour to establish them. To the Swiss Government belongs the honour of addressing the first circular note to the governments of Europe proposing the calling of a conference as a first step towards this end. This conference never met. The idea of international labour legislation was in the air, and voluntary societies composed of social reformers were beginning not only to discuss but to support it. The international meetings of organized workmen, such as the miners and cotton operatives, in different countries had familiarized the continental mind with the possibility of common action between peoples in respect of labour questions. Nowhere did the proposal for the conference arouse more general interest than in Germany, where the present German Emperor, then at the beginning of his career, was showing an active interest in German conditions of industry. It seemed that he too desired to call a conference, and on his request that he should be given precedence in the matter, the Swiss Government gracefully gave way. So it fell out that the first conference on workmen's protection met in Berlin, at the invitation of the German Government, in March 1890. There were fifteen delegates, all the governments of Europe, except those of Russia and the Balkan States, being represented. The chair was occupied by the then Minister of Commerce, Freiherr von Berlepsch, a man of broad and enlightened views and singularly sympathetic character, who subsequently became one of the founders of the International Association for Labour Legislation, and has probably, more than any other individual, secured the success of its biennial meetings.

At this conference, which the German Emperor stated in precise terms to have been called in view of the problems raised by international competition, a wide range of subjects was discussed by the delegates of the different States, including employment in mines, Sunday work, child labour, the employment of women and young persons, and administrative measures. While on many points agreement was found to be possible, and the general principles which should underlie industrial legislation were accorded ready acceptance, there was enough of objection, reservation, and allegation of constitutional difficulty to prevent the conclusion of anything in the nature of an international treaty. At the time the conference appeared to have failed of its object. Subsequent events have, however, shown that this was not the case. The failure to frame an official agreement probably showed that the ground had not yet been sufficiently laboured, and that further action in the direction of inquiry and discussion was necessary before the taking of so novel a step could be justified to the official mind; but it is certain that the recognition by the representatives of all the Western States that international action in labour questions was desirable in itself, and a goal at which governments should aim, not only laid the foundation for future State action, but gave to the voluntary work of obtaining the materials for building on that foundation an impetus and a sanction which it could have obtained in no other way.

That work was speedily set on foot and continued during the next ten years. It was greatly aided by the action of the International Labour Congress held at Zurich in 1897, when the trade unionists who composed the gathering passed resolutions in favour of the establishment of an International Labour Office, and by the Congress of Brussels which assembled at the invitation of Freiherr von Berlepsch, soon afterwards. At the latter gathering, which included a number of distinguished members of parliament, men of science, lawyers, and economists from France, Germany, Austria, Switzerland, Holland, and Belgium, the view that for the present progress must be made by the way of private initiative prevailed, and the creation of three national committees, having for their object the foundation of an international association for labour legislation, quickly followed. These committees, which had their head-quarters in Brussels, Berlin, and Vienna respectively, were by the good offices of Professors Cauwes and Jay enabled to call an international congress in Paris in the year of the Great Exhibition, and at this congress the Association was actually founded, and its statutes, provisionally drafted by Professor Mahaim and presented by the Belgian committee, were adopted. A president, a general secretary, and an international committee were provisionally appointed. The functions of the Association were also defined. It was designed to serve as a bond between all those who, in industrial countries, are convinced supporters of the principle of protective legislation; to facilitate the study of labour legislation by the publication of the labour laws of the different States, and of reports on their administration; to assist in the compilation of international statistics of labour and of all studies tending to bring into harmony the existing national industrial codes; and finally, it was charged with the duty of organizing the meetings of international congresses in which labour legislation should be considered. A very important part of its business was to consist in the publication in German, French, and English of a periodical collection of all labour laws newly in force in different countries.

This has been, from the first, the work of the International Labour Office, the fixed head-quarters of the Association, which serves as an exchange and clearing-house for all information pertinent to the Association's work. It is in perpetual session at Basle, and to it all reports and inquiries are addressed by the national sections, while from it issue circulars for the sections' consideration and requests for national investigation of problems which appear ripe for international treaty. The spade work of the Association is done by the national sections in their own countries, all action of the Association being necessarily based in the first instance on the reports received from them at head-quarters. There are now fifteen[31] such national sections—an increase of eight on the original group of seven formed in 1901. The actual membership of the Association has trebled in ten years. The seven sections to which belongs the place of honour at the head of the roll, are those of Germany, Austria, Hungary, Holland, Belgium, France, and Switzerland. Great Britain did not form a section till 1904, and it was not till 1910 that the British Government sent official representatives to the biennial meetings. The official representatives constitute a very important element at those gatherings. They attend the plenary meetings and take part in discussions, often contributing hints on their governments' attitude towards a given reform which are invaluable to those who are framing or modifying proposals with a view to government acceptance; and are also frequently present at the sitting of commissions charged with the consideration of detail, where they can hear the opinions and arguments of experts on every important point in debate. When resolutions are before the conference they do not vote—although in respect of voting right they stand on the same footing as other delegates. But on occasion they are not afraid to express opinions on the merits and tendencies of those resolutions which may have a determining effect on the votes of their fellow members, and I have known a few weighty words from such a man as M. Arthur Fontaine,[32] commending a proposal on which feeling was largely divided, to turn the scale at once in its favour.

The delegates of a section are elected by the section itself. They may be either men or women, and their number is in proportion to the size of the section, the maximum figure being eight, as far as voting delegates are concerned, but substitute members and experts may be present in addition. The following is a list of the fifteen sections represented at Zurich in 1912: Austria, France, Germany, Great Britain, Hungary, Italy, the United States, Belgium, Holland, Switzerland, Denmark, Spain, Sweden, Norway, and Finland. In addition the following countries and dominions sent government representatives only: Russia, Rumania, Greece, Turkey, Portugal, Brazil, Mexico, and the Australian Commonwealth.

A brief account of the Association's method of doing business may be interesting. Meetings are held once in two years, in the month of September, different towns in Switzerland being selected in turn for the place of assembly. The four conferences which I personally attended as British delegate took place in Geneva, Lucerne, Lugano, and Zurich. There are two plenary assemblies, the first having as chief business, apart from the hearing of introductory addresses, the appointment of the five commissions into which the conference splits up for actual work; the second meeting to receive the reports of these commissions and their recommendations, and decide upon the adoption or rejection of the latter. The trilingual rule is followed, delegates addressing the assembly either in French, German, or English, as they prefer, each speech being followed by a brief resume in the other two languages from the interpreter. In the commissions, by an unwritten but generally accepted custom, French and German are the only languages used. (Latterly the representatives of the United States of America, with the individualistic courage that becomes them, have shown a disposition to rebel against this custom and defy it; but the close of the Zurich meeting left it uncertain whether in this particular the New World will be able to prevail over the Old.) In the dignified speech-making of the General Assembly the recurrent changes of language, if a little disconcerting at first, can be faced with tolerable equanimity; but when it is a question of the quicker verbal sword-play which goes on in the commissions, the member imperfect in the tongues finds his position occasionally difficult. The sympathies of every humane person must go out to the expert who, having just made a telling expose of his case in French well practised for the occasion, encounters a crushing rejoinder in German of which he can barely follow the general drift.

The composition of these commissions—in which all the real work of the conferences is done—is truly heterogeneous. A commission may represent a dozen nationalities; it will certainly contain specimens of every social class, members of the most varied shades of thought in politics, religion, and sociology. I can still remember the constituents of my first commission at Geneva in 1906. Our subject was the night-work of young persons. At the head of the table was a professor of Civil Law in the University of Louvain. On either side of him sat a Catholic clerical member of the German Reichstag; a German Protestant pastor from Bavaria; a distinguished Parisian engineer; an Austrian nobleman interested in social reform; a Hungarian man of science; a Dutch factory inspector; a Swiss Trade Union secretary; and myself. We were a motley crew, but the strange 'pattern' which we must have presented to the observation of any higher intelligences interested in our deliberations had no effect on the goodwill and good humour with which they were conducted.

The range of subjects considered at international meetings is very wide. It includes all questions relating to the labour of women, young persons and children; matters of health and hygiene, with special reference to the use of poisonous material in industry, and the regulation of dangerous trades; workmen's insurance; the establishment of wages boards and minimum rates as preventives against sweating; the extension of the ten-hours' day and the Saturday half-holiday to be the legal rule in all industrial countries; and the introduction of the three-shift system and the eight-hour working day in continuous industries. As it is obvious that questions so large, touching so deeply the domestic life and habits of every people, cannot possibly be settled either out of hand or all at once, the Association's study of each separate problem is always prolonged and, according to the circumstances and the difficulty of the case, more prolonged in one instance than in another. Like the old pioneers of National Factory legislation, the Association has proceeded along the line of least resistance: not because it lacks courage, but for reasons of sheer prudence. If it was to become, in the words of M. Millerand, the present French Minister of War, one of its oldest and staunchest members, 'the laboratory in which international treaties are made', it was clear that it must not propose for international acceptance reforms which even among the most progressive peoples were looked upon as doubtful or dangerous. Accordingly it chose for the subject of its first great efforts two reforms in relation to which it could count with certainty upon a considerable amount of sympathy, and proposed international legislation prohibiting the night-work of women in factories, and the manufacture, importation, and sale of matches made with white phosphorus. Information on both these subjects was collected by means of the national sections; the Association in conference drew up proposals and recommendations to the governments concerned; the governments consented to a diplomatic conference at Berne, and the conventions concluded in 1906 were the happy result of their meeting.

But it must not be supposed that these results were reached without difficulty. Even as regards so comparatively simple a reform as the abolition of the night-work of women—to be carried out, after considerable 'delays' in favour of those countries in which night-work by women had hitherto been an accepted industrial custom—the adjustment of the change to the varying circumstances of each State proved a delicate business, and agreement could never have been reached but for the willingness of the more backward States to make substantial sacrifices and encounter possible risks. For this reason, the allowance of some years of grace before adherence to the treaty should become practically binding was a measure almost of necessity. It would have been unreasonable and might have been cruel to insist on Belgium and Hungary assimilating their practice in such a matter to that of Great Britain without ample time to prepare for the change. Thirteen States adhered to this treaty.

The difficulties in the white phosphorus case were at first sight even more striking, and, to begin with, only seven States—Germany, France, Denmark, Holland, Switzerland, Italy, and Luxemburg—were signatories of this convention. Of these, the first five had previously prohibited the use of white phosphorus within their own frontiers. Room was, however, left for the entry of other States into the convention at a subsequent date, with the result that the scope of the treaty has been gradually extended, and that we now find ourselves fairly within sight of the banishment from manufacture of one of the most deadly of all industrial poisons, and the consequent disappearance of an industrial disease peculiarly dreadful in its nature and symptoms. The tardy adhesion of the United Kingdom to this treaty remains a matter of regret; but the procedure of the Indian Government and of all the British self-governing dominions in following the mother country when at last she determined to take action has done much to redeem that tardiness. Obviously, it was the prohibition of the importation and sale of phosphorus matches in India and the Dominions which has forced the Scandinavian and Belgian manufacturers who were opposing complete prohibition to seek for substitutes for white phosphorus. At the present moment only Japan and Sweden among manufacturing countries stand outside the convention, the United States, whose constitution forbade her to impose prohibition by direct legislation, having brought about the desired result by the imposition of a prohibitive tax.

Is this all? it may be asked. If the question be of treaties signed, sealed, and ratified, the answer must be 'Yes'. On the subject of the night-work of boys and the hours of women and young persons, proposals were actually considered and conventions drafted by an official conference at Berne in 1913. The draft conventions were far from admirable: their framers went so far in the spirit of compromise to meet the objections of the backward States that the provisions laid down, had they been accepted without modification, would have tended to depress rather than to raise the standard of international opinion on the questions to be affected by them. We need not, therefore, feel much regret that the war has swept them, with so many other pre-war schemes, into the wastepaper-basket. The vast question of minimum rates of wages and their regulation by the State is obviously still too much in the experimental stage of its solution (even in this country where experiments have been boldest) for it to be possible to make it the subject of international agreement. As a subject of international discussion it has had its place, and an increasingly important place, for at least eight years past in the studies of the sections and the discussions of the Association meeting. Upon no question has public international opinion ripened more rapidly. In 1906, at Geneva, where the conditions of home workers were first under discussion, a few daring delegates met in corners and whispered under their breath the words 'Wages board'. By 1910, at Lugano, an English woman delegate was elected joint president of the Association's Home Work Committee, 'as a recognition of Great Britain's achievement in passing the first Trade Boards Act'; at Zurich, in 1912, a two-day conference on the legal minimum wage preceded the meeting of the Association, and a whole sheaf of minimum wage bills introduced by private members into the Chambers of different countries was before the delegates, together with an official measure of the French Government. To watch this change of attitude was to see international thought in the making. To appreciate its full significance, it is necessary to bear in mind the different aspects presented by the 'sweating' difficulty in this country and in the great industrial States of the Continent. The French or German social reformer sees it mainly, if no longer exclusively, as a problem of home work. Now home work in Great Britain is a by-product of a strictly limited class of industries, affecting a comparatively small class of the population; in France and Germany it forms a highly important section of the general industrial structure, it is interwoven, to an extent rarely grasped by British students, with the life, and habits, and productive power of the nation. Much more courage—and greater freedom from prejudice—was required in the one case than the other. The remarkable advance towards definite action on the part of the State in relation to the establishment of minimum rates for home workers which took place between 1906 and 1913 could not have been achieved in so short a time but for the labours of certain voluntary associations led by men of insight, candour, and indefatigable devotion. In this connexion the pioneer work of the late Comte de Mun and Professor Raoul Jay has been of inestimable value. Realizing themselves, as did few unofficial reformers, the wide nature of the movement in which they had engaged and the impossibility of confining it in its sweep and effects to a section of the manual workers, they succeeded in gradually bringing home to the ablest among their fellow-workers the necessity for closing the gulf which French mental habit had fixed between factory and home workers and preparing to treat both classes on a similar footing of equity. In Germany,—where, as we might expect, there was less forwardness to launch unofficial schemes and a disposition to work rather from the first through authoritative channels—experiments were being made under the Home Work Act which, if of little value in themselves, seemed the earnest of much better things.

If this result only had been attained, the meetings of the Association and the labours of the sections would not have been in vain. But far more was in process of achievement when the work of the Association was interrupted by the catastrophe of the European War. The adoption in all industrial countries of the 'English week', with its half-holiday so much coveted by the continental worker—the establishment of a uniform working day—the gradual introduction of the eight-hours shift into such 'continuous industries' as steel-smelting and glass-blowing—an international agreement to eliminate the use of lead from many branches of the pottery industry and to limit and safeguard its use in all others,—these were only some among the questions which study and investigation and discussion had brought to a stage at which the Association could look upon them as fit matter for potential international conventions in August 1914. Now that its activities are, for the most part, in suspense, it is well to remember that its greatest achievement was the proof, again and again renewed, that it is possible for persons of twenty different nationalities, holding the most diverse opinions on nearly every subject under the sun, not only to act together but to find common motives of action so strong as to break down every sundering barrier of political doctrine and religious creed. Whatever of suspicion or antipathy might flourish outside the boundaries of the international association, these evil weeds have never taken root inside them. Is it Utopian to dream, when the days of peace shall have returned, of a reconciliation within its borders for those between whom at present the great gulf of division seems hopelessly fixed?

BOOKS FOR REFERENCE

History of Factory Legislation, Harrison and Hutchins. Macmillan. Revised edition.

Frederic Keeling, Child Labour in the United Kingdom. P.S. King.

Clementina Black, Sweating. Duckworth.

R.H. Tawney, Studies in the Minimum Wage: (i) Chainmaking; (ii) Tailoring. G. Bell & Sons.

J.A. Hobson, Work and Wealth. Macmillan.

Edward Howarth and Mona Wilson, West Ham: A Study. Dent.

Sir Thomas Oliver, M.D., Dangerous Trades. John Murray.

Annual Reports of International Association for Labour Legislation (British Section), 1906-14. To be obtained of the Secretary, Queen Anne's Chambers, 28 Broadway, Westminster.

Ernest Barker, Nationalism and Internationalism. C.S.U. Pamphlets, Mowbray, Oxford.

Dr. Bauer, International Legislation. Mowbray, Oxford.

Ernest Francke, 'International Labour Treaties,' Economic Journal (June, 1909). Reprinted separately, Macmillan.

Albert Metin, Les Traites Ouvriers. Armand Colin: Paris.

E. Mahaim, Le Droit International Ouvrier. Librairie Recueil-Sirey: Paris.

Fagnot, Millerand et Strohl, La Duree legale du Travail. Felix Alcan: Paris.

Paul Boyaval, La Lutte contre le Sweating System. Felix Alcan: Paris.

Students might also consult the following Reports:

Le Travail a Domicile en France. Ministere du Travail: Paris.

Le Travail a Domicile en Belgique. Ministere du Travail: Bruxelles.

FOOTNOTES:

[Footnote 31: These figures represent the position at the last meeting of the Association held at Zurich, 1912.]

[Footnote 32: The distinguished Permanent Head of the French Labour Office.]



XI

COMMON IDEALS OF SOCIAL REFORM

Earlier ages were more able than ours to believe in the good old days. We, knowing more of the past than our forefathers did, can find in it no golden age. But our eyes do not rest even upon the present. In the nineteenth century men thought they were at the end of a process, and their evolutionary creed was often only a polite method of saying what fine fellows they were. Now we look forward. The future seems to us longer than the past and more important than the present; and we ourselves seem to be at the beginning rather than at the end of time. A knowledge of the past has made it impossible to believe that growth has stopped, and we understand how different the future may be, in part at least, by perceiving how different even this grimy and blood-stained present is from the still more inhuman past.

Among the recorded changes the Economists write of an increasing interchange of goods, and we can see as well an increasing interchange of ideas across the frontiers of States. Music, painting, literature, and science have all been influenced; and ideas concerning political, economic, and social facts have been affected by that interchange which has developed our philosophy, our science, and our art. No one nation has originated all; and each nation has depended on hints and hypotheses which have arisen in others.

But the interchange of ideas on social life has led to an increase of ideals, which are plans of action emotionally appreciated and therefore motive forces. Some of these are the Utopias of individual thinkers; but we shall consider here only those more powerful ideals which are shared, however vaguely, by many. In this case also, as in the purely intellectual sphere, the fire spreads from group to group, from nation to nation; and as the interchange of ideas increases knowledge, so the exchange of enthusiasm makes action more powerful. A really effective ideal, however, cannot arise except from the perception of definite evil. Vague discontents may cause such revolution as leads to reaction; but the clear sight of evil is the only source of reform. We may take it for granted, then, that although an ideal is nerveless if it is not passionate, it is futile unless it is based on knowledge. Therefore a hint must be given of the evils from the knowledge of which ideals of social reform now rise. That all is not well in the relations of man to man or of group to group must be fairly obvious to any one with imagination enough for sympathy. General dissatisfaction and universal cures for society are childish; but the perception of this and that evil gives rise to different plans for reform which all originate in the enthusiasm which is an ideal. We may put aside the long history of the growth of this shared enthusiasm for better relations between men, whatever their ability, their rank, their race, or their government.

The common ideals of the present are the result of a gradual development, but we shall consider them here as attempts to deal with existing evils and plans for a better future.

* * * * *

Some social evils of the present are perhaps as old as any settled civilization. Such are disease and personal violence. Some are due to forces which have come into existence recently, owing to increased communication and accumulated wealth. Such are extreme poverty and the dehumanizing of social relations. With both kinds of evil we are moved to deal, and we are not deterred from the attempt to reform even long-established evil; for we feel that we do not know what is possible. Nothing is inevitable. This is not the place to give in detail the description of those evils which are being dealt with. It is enough if we recognize that it is no abstract or airy theory of equality or human nature which moves us to action. All real theories are intensely personal: and no theory has ever yet moved men unless they saw through it to the crude facts. However it may be phrased in a theory of society, we recognize it as evil that disease, leading to premature death, should be as common as it is. As a social evil it may be said to disturb seriously the relations between men. We see also that it is a social evil that men should use fraud or violence in compelling labour or in the pursuit of riches. Of the newer social evils there is the physical and spiritual deterioration which seems to result from the massing of men in great cities. There is also the dehumanizing of the relations between master and man. And this is like in kind to the dehumanizing of all functions in the vast institutions of modern times. The director of a company comes to regard himself as part of a machine; and so does the shareholder. So eventually does the agent of the State. Until at last we reach the immense evil that human action is done for which no moral responsibility is felt. How then shall we act? What has been done and what is still hoped for? The answer to such questions will be a statement of ideals.

One may speak of ideals of social reform from two different points of view; either with respect to (1) the changing sentiment which produces movements for reform or with respect to (2) the institutional change which embodies that sentiment. The two are complementary parts of one historical movement: and it is difficult to divide them as cause and effect. For sentiment, becoming enthusiasm, certainly causes institutional change, and yet the reformed institution invariably creates a new sentiment. The province of law and of social custom is to lead as well as to register—a dynamic as well as a static influence, to increase order and to incite to liberty. In actual life, therefore, it is often impossible to separate the sentiment from its embodiment in measures of social reform.

For purposes of study, however, one may divide. We may put aside the moving sentiments—the passions, however faint, which urge men to wish for a better future—and we may consider first the particular instances of reform.

* * * * *

One definite and in some sense new departure in the results of the shared enthusiasms of nations has been the industrial legislation of recent years. That has been already dealt with. But, although in an economic age such as ours industrial reform may seem the most striking, it is not the only effect of our shared enthusiasm and later ages may not think it the most important. There has been reform of social evils owing to the interchange between nations of ideas on education, religious toleration, medicine, and sanitation, the treatment of criminals, the suppression of slavery and many other subjects. All these and many more reforms are, as it were, registered in institutional (legal or administrative) change.

Perhaps it is better to begin with a definite instance of the working of an ideal, lest it may seem that we are speaking only of an empty aspiration. We may take as an example the reforms connected with medicine and sanitation, and those only in so far as they have been officially established by the joint action of states. This is a very restricted embodiment of a social ideal, since of course we may find the same use of common labour between men of different races in the private contest with disease or in the municipal preventive medicine which in every great city owes much to investigators and practitioners of other nations. But it is better to take the most tangible effect in purely governmental action.

The French Government proposed an international conference, which met in 1851, to deal with infectious disease; and a second conference met in 1856. In 1865 the outburst of cholera in the East led to a third congress at Constantinople. Great Britain opposed treaties for regulating quarantine, &c., because of the delay which might be caused to the pursuit of shipping interests. But at last a treaty was made in 1892 at Venice for protection against cholera. Further and more effective treaties were agreed to by civilized states in 1897 and 1903. A bureau of information concerning infectious disease was established at Paris, and commissions to supervise were established in Turkey and Egypt. With regard to sleeping sickness Great Britain took the initiative; and a conference met in 1907, in London, at which six countries were represented. So much with respect to disease; we may now turn to examples of the joint action of states as regards crime.

The African slave traffic has been dealt with since 1885 (Berlin Conference) by the European States acting together on certain general principles. And what is known as the White Slave traffic was the subject of arrangement between fifteen states in the conference at Paris in 1902.