Carlyle and Ruskin. The literary denunciation of individualism and capitalist practice reached boiling-point in the works of Carlyle and Ruskin. Both were mystics, and their acute senses were jarred by the sight of a soul-less, mercenary civilization. Carlyle saw that men were becoming machines; "the mysterious springs of love and fear and wonder, of enthusiasm, poetry, and religion," were drying up under the scorching rays of commercialism. A " once merry England'' was becoming a "black, godless, waste-struggling world,'' and under the tyranny of capital, machinery, steam, and laissez-faire "the common weal was a common woe. The prevailing doctrine was to Carlyle "the choking, sweltering, deadly, and killing rule of no rule," " “anarchy plus a policeman,'' 'do-nothingism.'' Economic laws were "laws of the shop-till,'' and life is not merely a shop. As for parliament, the "national palaver," Carlyle thought its "reform ministries as barren as the east wind,'' and declared, "Liberty produces, What? Floods of Hansard debates every year, and apparently little else at present." In short, the "condition of England question'' was a perpetual nightmare to him, and it seemed incredible that with such a problem awaiting solution at home, statesmen should spare time to extend pity to Turks and Armenians, or smile because the liberated negroes of the West Indies were "at last happy."

When one asked for remedies, Carlyle was unsatisfactory. Parliament and democracy evoked his most vicious sarcasm. Manhood suffrage suggested to him a demand later on for horsehood and doghood suffrage; the "equality of man" placed the cotton-picking nigger on the same plane as Socrates or Shakespeare; the ballot-box was only a modern device for enabling the people to choose Barabbas in preference to Christ. Free trade, the popular panacea of the time, was simply "free racing in the career of cheap and nasty." Carlyle pinned his hopes to rule by heroes; just as in the past religious, political, or military heroes had led a submissive people, so in the future the new "captains of industry," having improved their stock by intermarriage with the old nobility, would order and control society. The many were to be bound in permanent service to the few, and, recognizing the supreme excellence and wisdom of their leaders, would consent to be educated and drilled into the new way of life. Let the best rule, said Carlyle; but he failed to show how those best would be chosen. In all this Carlyle assumed a big change in character, and regarded moral reform as indispensable to success. "All reform," he declared, "except a moral one, will be unavailing. Political reform can indeed root out the weeds, but it leaves the ground empty-ready either for noble fruits or for new, worse tares." Carlyle's remedies found very little support, especially among the many; but his denunciations of contemporary society and thought had a profound influence upon British opinion generally.

Carlyle thundered; Ruskin kept calmer, but the eloquent, polished sentences of the latter completed the work which Carlyle had begun. Ruskin had intended to devote himself to a life of art, but as he realized the character of the England in which he lived, he lost all taste for art, and set out on a crusade for the regeneration of society. He felt that art could only be good and beautiful when it grew in a political and economic world which was itself good and beautiful. Hence he endeavoured to hasten the time when this disgusting nineteenth century has-I cannot say breathed--but steamed its last, 22 taking with it all its ugly materialism and selfishness. For forty years Ruskin maintained a vigorous attack on the industrial system

and on orthodox political economy. Modern industry was mechanical; therefore it destroyed all manual skill, all pride and joy of labour. It was based on competition; therefore it fostered dishonesty, adulteration, and the plundering of one's employees. As for political economy, which should be part of the big science of life, it had become the science of money-making. It had created a fiction-the economic man-by shutting out all the sides of human nature which make life worth living; it had made wealth the master, instead of the servant, of life. It preached that man is naturally covetous: it supplied a get-rich-quick' formula, and made man a "getting and spending animal."' Instead of this, economics should be the science of welfare, pointing the way to true wealth; but there is no wealth but life, life with all its possibilities of effort, service, affection, and happiness.

As remedies, Ruskin urged some very practical measures. The state must intervene to provide education for the young, employment, if necessary, for the adult, and support for the aged. Ruskin would compel all men to work; he had no patience with the idler. Individualism must go. Beyond that Ruskin went on the lines laid down by Carlyle. Let the wealthy realize their responsibilities to those under their charge; then, being made wise, they will so act as to bring sweetness and light to the many. Ruskin was no enemy of property, but he believed that property owners should regard their wealth as a trust, to be administered for the benefit of all. He was antidemocratic, almost to the point of verbal violence. Let the wisest rule, and let the lords of economic life be masters, but enlightened masters. An economic chivalry, with Noblesse oblige as motto this was the best that Ruskin could suggest. And yet, though neither democrat nor socialist, Ruskin exerted an immense influence over the thought of his day. He helped to destroy individualist theory and create a greater belief in the value of state action. He gave economics a broader outlook and a deeper human sympathy. His works have lit the flame of idealism in the breasts of thousands, and turned many on to the path which leads to socialism.

Such was the work of the spiritual school, powerful in its criticism, if fanciful in some of its remedies. It roused the social conscience from torpor, goaded it into action, and thus made the path of social control much easier to tread.

Socialism and State Socialism. Meanwhile economic thought was being disturbed within by the rise of economists who questioned the old theories and conclusions. Mill, starting out as a disciple of laissez-faire, was driven to advocate taxation of the unearned increment of land, and the concluding chapter of his "Political Economy" virtually gave away the whole case for laissez-faire. During the subsequent years economists threw overboard any allegiance to fixed principles of natural rights and laws, and declared that when necessary or desirable the state must act. In fact, throughout the world, thought generally turned in this direction. In Germany, during the seventies, a school known as the state socialists arose, urging strong state action. This movement influenced Bismarck, and was responsible for the introduction of comprehensive factory laws, accident and sickness insurance, old-age pensions, state industries, etc. In Australia, The Age, under the influence of its proprietor (David Syme) advocated a similar policy. Syme, a keen student of economics, declared that laissez-faire was simply "a policy of drift.” He urged a vigorous protectionist policy for his state, asserted the legal and moral right of the government to regulate industrial conditions, and fathered a long series of laws dealing with

industrial affairs, land settlement, etc. In America, the work of Henry George laid stress on the socially-created value of land, and led to a movement in many countries for land taxation or nationalization.

But to many state socialism or intervention was a thing of shreds and patches, an attempt to palliate social evils, a dodge to prop up capitalism and avert its overthrow. That was the view of the socialist writers who became prominent after 1848. They began with a vigorous criticism of the existing order, and from this passed on to urge the claims of a happier regime, which could only come with the abolition of private property in land and capital. The socialist movement will be fully dealt with in later chapters, so it is unnecessary to dwell on it here. But it is important to note its attitude of revolt; to the working classes of Europe socialism came as a new gospel of deliverance, and added fuel to the fires of discontent.

Results. Under the weight of all this condemnation, laissez-faire bent and then broke. From about 1870 onwards governments recognized more and more their duties, abandoned the policy of inertia, and began to "do something.'' The first essential was to obtain information, and this was done by the appointment of countless royal commissions. These official enquiries, supplemented by private investigations, revealed many startling facts; such phrases as "the destitute residuum, "the submerged tenth, 'rural depopulation,''''sweating,”’ ́ ́slumdom,” etc., began to have a real and terrible meaning, and legislation set to work to cope with the "social problem. Politics became more economic in character, especially since the rise of Labour Parties in the nineties.

The Counter Reaction. After some thirty years of ever-widening state control, there have been visible since about 1910 the beginnings of a strong reaction against the state's authority and activities. This is due to many things. (1) The failure of state action or the refusal of the state to touch root problems brought it into some discredit, and created widespread disillusion concerning the possibilities of political effort. Unemployment is still with us, prices have risen continuously since 1896, capital makes bigger profits than ever, and wealth and poverty still jostle each other in society. The path to the conquest of political power is long, rough, and steep. State regulative machinery is cumbersome and works slowly. State-owned industries are disappointing in their results. Radically-minded politicians are weaned by place and pay from the true faith. In short, men expected so much from public intervention, and seem to have got so little. This is probably a short-sighted view, and fails to take account of the volume and value of what has been accomplished; but when men are keen to get to the millennium they get impatient of slow, roundabout tracks and seek a short cut.

(2) New doctrines have come into the field. Syndicalism regards the state as the political tool of capitalism, and asserts that the system must be overthrown by revolutionary direct action. Guild socialism challenges the undiluted sovereignty of the state. It declares that other groupings of men are quite as entitled to sovereignty in certain lines as is the political grouping. Occupational group organizations represent the people in their capacity as producers; therefore there should be a divided sovereignty, with the state as political head, representing the consumers as a whole, and the unions cr guilds, knit together in a national federation, representing the producers as a whole. From this it follows that economic affairs should be regulated largely by economic organizations, not by an external political body. Indus

try is to be self-governing. Thus we find ourselves back again at laissez-faire, a new kind of laissez-faire. The state is to let alone," to keep its hands off industry; the determination of conditions is to be left in the hands of those who work in an industry, organized in their proper groups. They know what is best, the state does not. Without accepting any of these doctrines in full, many trade unionists are of opinion that state regulation has reached its high-water mark, and look to industrial action rather than politics for the realization of their ideals. (See Chapter XXIV.)

Books Recommended. Smith, Adam, "Wealth of Nations'; Ricardo, D., "Principles of Political Economy"; Bentham, J., “Principles of Legislation"; Spencer, H., "Man versus the State'; Brown, W. J., "Underlying Principles of Modern Legislation"; Dicey, A. V., "Law and Opinion in the 19th Century''; Gide and Rist, "History of Economic Doctrines"; Hirst, F. W., "The Manchester School"; Mackay (ed.), "A Plea for Liberty''; Toynbee, A., "Industrial Revolution, ," chaps. 7, 10-12; Dickens, C., "Hard Times"; Kingsley, C., "Yeast" and "Alton Locke"; Carlyle, T., Shooting Niagara,''"" Signs of the Times," and "Past and Present"; Ruskin, J., "Political Economy of Art" and "Unto This Last"; Barker, E., Political Thought from Spencer to To-day''; Gibbins, H. B., “English Social Reformers''; Kropotkin, P., “Mutual Aid”; Cole, G. D. H.. “Selfgovernment in Industry'; Wallas, G., "The Great Society'; Hobhouse, L. T., "Liberalism.''

CHAPTER IX.

THE FREE TRADE MOVEMENT.

DISCUSSION on the relative merits of free trade and protection as national commercial policies has exercised men's minds for at last two centuries. The controversy has been waged with great energy, and at times with bitterness and a resort to personalities. Political opinion has assumed that the whole national and economic future depended on a wise choice of the right policy to be adopted, and vested interests have ranged themselves almost solidly on one side or the other. The importance of the whole question has probably been exaggerated. The tariff policy of a country is only one out of many factors determining economic progress. Inventions, discoveries, the spread of general and technical education, the ambition, energy, and efficiency of the people, abundant natural resources, all play their part. Given these assets, a nation will progress materially no matter what may be its tariff policy.

The period 1815-1914 witnessed in many countries a complete circle in ideas on fiscal policy. In 1815 protection was the rule in every land. Then came a strong movement towards free trade, culminating about 1860 or 1870. From that date onwards the reaction set in, and most countries once more began to build up high tariff walls. This reaction eventually spent itself, and just before the outbreak of the War the tide seemed to be turning again, in protectionist countries, in favour of free trade. But the War roused intense national sentiments, which caused a return to stronger protective measures.

The Free Trade Position. The question of free trade or protection arises when the inhabitants of one country begin to exchange their goods with those of another. International trade before the war was between individuals, and the developments of finance, transit, etc., especially during the 19th century, had knitted up the people of the world in international trade relationsnips. The goods of Britain and Germany were known in every part of the world. Each country gave something to the world, and drew from every nation something in return. But as these developments became more clear, even in early centuries, statesmen began to ask, "Is this growth most advantageous to our nation?'' The idea grew up that while foreign trade might benefit the individuals concerned in it, the result from the national point of view might be harmful. Out of this realization of a possible rivalry between individual and national interests arose the free trade versus protection controversy. To advocates of protection unfettered foreign trade was bad; to supporters of free trade it was wholly good. Let us examine the free trader's point of view; the protectionist's arguments will be stated later. He urges many advantages which would accrue from the adoption of his policy, of which the chief are as follows:

(1) Industry is carried on for the production of wealth-i.e., commodities. Different countries or areas are especially well endowed by natural resources, etc., for the production of particular commodities. Therefore let each nation specialize on those industries for which it is best fitted, thus