rags, and they are told it is because they have produced too much clothing. There are shoe-workers whose shoes are falling off their feet, and they are told it is because they have produced too many shoes. There are carpenters who have no homes, and they are told that a great many homes are needed, but unfortunately it doesn't pay the builders to go. ahead just now. This may sound like a caricature, but it happens to be the most prominent single fact in the consciousness of 5,000,000 Americans at the close of the year 1921. No wonder they are discontented with the present order.

The solution of the mystery is so simple that the 5,000,000 unemployed cannot be kept permanently from understanding it. The reason the five men on the island are starving is because one man owns the island and the others own nothing. If the island were community property, the five men would each own a share of the contents of the barns and storehouses, and would not be starving. If the 100,000,000 people of America owned the productive machinery of America, then instantly the unemployment crisis would pass like an evil dream. The farm-workers who need shoes would exchange their food with the starving shoe-workers, and the starving shoe-workers would have jobs. They would want clothing, and so the clothing-makers would start to work; and so on all the way down the line. There is only one thing necessary to make this possible, and that is the thing which we have agreed to call the social revolution.

CHAPTER LVIII

THE IRON RING

(Analyzes further the profit system, which strangles production, and makes true prosperity impossible.)

We have seen that in an exploiting society there is a surplus which is taken by the exploiter; and that under the modern system this surplus must be sold at a profit before production can continue. The vital fact in such a society is that the worker has not the money to buy back all that he produces; therefore it is inevitable that a surplus product should accumulate. When this happens, production must be cut down, and during that period the worker is without a job, and without means of living. The fact that he needs the product does not help him; the point is that he has not the money to buy it. In such a society the productive machinery is never used to the full. The machinery is controlled by a profit-seeking interest, seeking an opportunity to make sales, and restricting production according to the prospect of sales. So the actual product bears no relationship to the possible product, and people who live in an exploiting society can form no conception of true prosperity.

For, you see, the market is limited by the competitive wage system. We have seen that in our own rich, prosperous country only one family out of six has more than $1,000 a year income; only one family out of twelve has $2,000 a year. It does not make any difference that the warehouses are bursting with goods; a family constitutes a market of so many dollars a year, and then, so far as the profit system is concerned, that family is non-existent; that family stops consuming, and the productive machinery is halted to that

extent.

I have been accustomed to portray the profit system under the simile of an iron ring riveted about the body of a baby. That ring would cause the baby some discomfort at the beginning, but it would not be serious, and the baby would get used to it. But as the baby grew the trouble caused by the ring would increase, and finally there would come a time

when the baby would be suffering from a whole complication of troubles, and for each of these troubles there would be but one remedy-break the ring. Does the baby cry all the time? Break the ring! Is its digestion defective? Break the ring! Is it threatened with convulsions or with blood poisoning? Break the ring!

Here is our industrial society, growing at a rate never equalled by any human baby; and here is this iron ring riveted about its middle. Here is poverty, here is unemployment, here is graft, here is crime, here is war and plague and famine; and for all these evils there is but one cause, and but one remedy. Break the ring! Set production free from the strangulation of the profit system.

I will admit that there may have been a time in the history of the social infant when this ring was necessary. I admit that if the great industrial machine was to be constructed, it was necessary that the mass of the people should consume only part of what they produced, and should allow the balance to be reinvested as capital. But now it has been done, and the process is complete. We have a machine capable of producing many times more than we can consume; shall we still go on building that machine? Shall we go on starving ourselves, to save the money, to multiply over and over again the products, in order that we may be thrown out of work, and be starved even more completely?

A few generations ago we had in colonial America a society that in part at least was "free." In that society everybody got the necessities of life. They did not have the modern Sunday supplement and the moving picture show, but they had bread and meat and good substantial clothing, and furniture so well made that we still preserve it. The children in those days grew up to be strong and sturdy men and women, who would have seen nothing to envy in the bodies or minds of the slum population of New York and Chicago. In short, they had all the true necessities of life; and yet their work was done by hand, the power process was unknown and undreamed of.

Now comes modern machinery, and multiplies the productive power of the hand laborer by five, by ten, sometimes by a hundred. Here, for example, is the "Appeal to Reason" selling millions of cheap books for ten cents apiece, and making a profit on it; installing a gigantic press which takes

paper, sheet after sheet, prints 128 pages of a book at one impression, and folds and stitches and binds the books, all in one process, and turns them out complete at the rate of 10,000 copies per hour. Here is a factory which turns out 100,000 automobiles a month. Here is a mill which turns out many millions of yards of cloth a month. If our colonial ancestors had been told about these marvels, they would have said instantly: "Then, of course, everybody in that society will have all the books they want, and all the clothing they want, and all the automobiles. Everybody in that society will have five or ten or one hundred times as much goods as we have."

Imagine the bewilderment of our colonial ancestor if he had been told: "The majority of the people in that society will not have so much of the real necessities of life as you have. They will have a few cheap trinkets, designed to tickle their senses; they will have cheap newspapers, carefully contrived to keep their minds vacant and to keep them contented with their lot; they will have moving picture shows constructed for the same purpose; but all their material things will be flimsy, put together for show and not for permanence; their food will be adulterated, their clothing will be shoddy, everything they have will be made, not for their service, but for the profit of some one who lives by selling to them. The average wage earned by those who do the work of this new machine civilization will be less than half the amount necessary to purchase the necessities of a decent life, and onetenth of the total population will be living in such poverty that they are unable to maintain physical fitness, or to rear their children into full sized men and women.”

CHAPTER LIX

FOREIGN MARKETS

(Considers the efforts of capitalism to save itself by marketing its surplus products abroad, and what results from these efforts.)

If our analysis of present-day society is correct, we have the enormous populations of the modern industrial countries, living always on the verge of starvation, their chance for survival depending at all times upon the ability of their employers to find a profitable market for a surplus of goods. At first the employer seeks that market at home; but when the home markets are glutted, he goes abroad; and so develops the phenomenon of foreign trade and rivalry for foreign trade, as the basic fact of capitalism, and the fundamental cause of modern war.

Let us get clear a simple distinction concerning foreign trade. There is a kind of trade which is normal, and would thrive in a "free" society. In the United States we can produce nearly all the necessities of life, but there are a few which we cannot produce-rubber, for example, and bananas, and good music. These things we wish to import. We buy them from other countries, and incur a debt, which we pay with products which the other countries need from us; wheat, for example, and copper, and moving pictures with cowboys in them. This is equal exchange, and a natural phenomenon. A "free" society would produce such surplus goods as were necessary to procure the foreign products that it desired. When it had produced that much, the workers would stop and take a vacation until they wanted more foreign prod

ucts.

But under capitalism we have an entirely different condition-we produce a surplus of goods which we have to sell in order to keep our factories running, and to keep our working population from starving. And note that it does not help us to get back an equal quantity of foreign goods in exchange. We must have what we call "a favorable balance"; that is, we must have other people going into debt to us, so