fifths of the iron used being imported from Sweden. In 1802 Great Britain possessed 168 blast furnaces, and produced 170,000 tons of iron annually. In 1806 the produce had risen to 250,000 tons; it had increased in 1820 to 400,000 tons. Fifty years afterwards, or in 1870, 6,000,000 tons of iron were produced from British ores.

The progress of the iron trade indicated, of course, a corresponding development of the supply of coal. Coal had been used in England for domestic purposes from very early periods. Sea coal had been brought to London; but the citizens had complained that the smoke was injurious to their health, and had persuaded the legislature to forbid the use of coal on sanitary grounds. The convenience of the new fuel triumphed, however, over the arguments of the sanitarians and the prohibitions of the legislature, and coal continued to be brought in constantly though slowly increasing quantities to London. Its use for smelting iron led to new contrivances for insuring its economical production.

Decay of small industries. Scarcely less striking would be an account of the rise of machine production in other industries, following the use of steam power and cheap iron and steel. Shoe manufacturing, the grinding of flour, the slaughtering of meat animals and the curing and packing of meat, the manufacture of watches, automobiles, etc., and various other industries have shown the same tendency toward the factory system of production. Regarding changes in our own country, Professor Ely writes:1

Let the reader call to mind the many things in our economic life which the world never saw before. He will, of course, think at once of the railway and of steam navigation, and of other applications of steam to industry. But these have brought other important new phenomena. The concentration of large masses of working-people in great factories of which they own no part, and under a single employer, such as we see daily, is something new for skilled mechanics; not that nothing of the kind ever existed before, but its existence is so much more common and affects so many more people that in its social aspects it is new. In the last century, and in previous centuries of the Middle Ages, artisans owned the tools which they used, and after they had fully mastered their trades usually called no man master, but worked in their own little shops. Even within the memory of the author, still comparatively a young man, this condition of things

1 Richard T. Ely, An Introduction to Political Economy, pp. 55-57. New York Chautauqua Press, 1889.

has become less common. The smith, under the spreading tree, of whom Longfellow sang, is disappearing. He has left the cross-roads in the little village and now works in a machine shop. His friends, the carpenter and the shoemaker, have accompanied him. A few artisans may stay to do repairing and other small work, but the cheaper processes of vast establishments have rendered this migration inevitable for the many. Only the few among artisans can live in the old style.

CONCENTRATION IN LARGE CITIES

Houses are constructed in large establishments and they are sent to small places where it is only necessary to put them together. Merchants have also been obliged to leave the villages where they were owners of independent establishments to seek employment in immense city retail and wholesale shops, because the railroad has carried their customers away from them.

The amount of production increases continually, but the number of separate establishments where production is carried on decreases uninterruptedly. Milling serves as a good illustration. "The completion of the great mills has caused the abandonment and decay of hundreds of the picturesque, oldfashioned neighborhood mills. In 1870, according to the census of that year, there were in the entire country 22,573 grist mills, 58,448 hands, representing $151,500,000 of capital, and making a product worth $444,900,000. In 1880 the number of establishments was 24,338, the number of hands 58,407, the capital invested $177,300,000, and the value of the product was $505,100,000 (the price of flour had declined ten per cent in this decade). The increase shown in the number of establishments . . . is more apparent than real, the great bulk of flour having been made in a decidedly smaller number of mills in 1880 than in 1870. Since 1880 the blighting effect of the great merchant mills upon the small establishments has become visible to every one. According to the Miller's Directory for 1884, there were at that time some 22,940 mills in the country, a decline of 1,398 from the census figures of 1880.... From 1884 to 1886... the number of milling establishments has declined to 16,856. . . a loss in two years of more than twenty-six per cent." 1 The number of mills in the South has declined more rapidly than elsewhere. In 1880, in North Carolina, 1313 mills employed only 1844 men, but in the same state there were only 632 mills in 1886. It is said that the number of mills in the country is destined to become very much smaller still. Readers can readily gather from census and trade reports many similar illustrations of this concentration of business, which is one of the main causes of the existence of present problems.

1 Albert Shaw in the Chautauquan for October, 1887.

...

Tendency of mechanically expert nations toward indoor industries. Large portions of the world's population still remain in a condition of mechanical inexpertness. They find it more advantageous to live from the products of the soil, exchanging these products for the manufactured products of the mechanically expert nations. Other populations, like those of our own West, while mechanically expert, occupy land of such abundance and fertility that they find it more profitable to cultivate land than to turn to the indoor industries. They use their mechanical expertness in contriving and operating farm machinery. They exchange their large surplus of farm products for the manufactured products of other people who are mechanically expert and who occupy lands of less extent and lower fertility. The latter, not having vast areas to cultivate, find less profitable opportunities for their mechanical expertness out of doors than indoors. Therefore they develop the indoor industries. England, who got a good start ahead of the rest of the world in this line of development, prospered amazingly. The eastern part of the United States, together with France, Belgium, Holland, and lately Germany, have been following in the same direction. As this tendency increases, the competition among the indoor industries is likely to become so intense as to reduce the profits and drive a certain percentage of the people back to the farms.

Taking the United States as a whole, it is rapidly ceasing to be primarily an agricultural country and is becoming a manufacturing country, following a similar development in England and northwestern Europe. Canada, South America, Australia, South Africa, and all countries where white men colonize will doubtless follow in the same direction. There will then be left only the tropics in which to sell the surplus products of manufacture and from which to draw the surplus products of the soil. It is probable that the development of the indoor industries will be checked before that state is reached. In that case each country will have to preserve a balance, or equilibrium, between the indoor and the outdoor industries.

As pointed out in the chapter on the Genetic Industries, the advance in civilization, and the general improvement of living conditions, tends to add to the relative importance of the indoor as compared with the outdoor industries. The finer the goods we demand, the more work we make, generally speaking, for the indoor workers. Even farm work itself comes, in a sense, to be done indoors rather than outdoors. The substitution of the tractor for the horse may serve to illustrate this statement. The raising of horses is outdoor work; the manufacturing of tractors is indoor work. If we use more tractors and fewer horses, a larger proportion of our workers will work indoors and a smaller proportion outdoors.

This is a process which must be expected to continue even though we remain a self-sufficing nation. If we cease to be a self-sufficing nation, bringing raw materials and products of the soil from distant portions of the earth, and sending in exchange the more refined products of the indoor industries, we must expect that manufacturing will become in larger and larger degree our dominant occupation.

CHAPTER XIX

TRANSPORTATION

Moving things over long distances. Since all industry consists in moving materials from one place to another, it follows as a matter of course that transportation must form an important part of the industrial system. That which we call transportation differs, however, from other kinds of work in that it consists in moving materials over long distances, - distances which are measured in miles rather than in inches, feet, or yards. 'The transportation system has been likened to the veins and arteries of the physiological organism, just as the telegraph and telephone systems have been likened to the nerves.

The development of the factory system as described in the preceding chapter, and of large-scale production in general, would have been impossible without cheap transportation.

The railway and the factory have gone hand in hand in their development and in their economic results. With the means of transportation which existed two hundred years ago large industries would have been impossible. The substitution of turnpikes for common roads, of canals for turnpikes, and of railways for canals was as essential a part of industrial progress as was the development of the factory system.1

Without a wide market on which to sell its large product a large factory or manufacturing establishment would be an impossibility. In the days of restricted local markets, when each little community was almost self-sufficing, small shops having individual handicraftsmen could supply the needs of each such unit. Not the least important of the changes which have come about since the middle of the eighteenth century has been the

1 President A. T. Hadley, "Transportation," in Palgrave's Dictionary of Political Economy.