Untitled

Evening Post, Issue 63, 11 September 1935, Page 8

Although there is everywhere evidence to the contrary, the assumption that the world is a place where a few I "haves"- oppose millions of • "haveinots" is still tacitly ■ accepted in' I casual discussion. If the issue were indeed between 1 per cent, of big capitalism and 99 per cent, of abject poverty, it would have ended long -before now; and the very persistence, of the rich v. poor problem in its present form is one proof of ihe converse—viz., that a comfortable standard of living has extended from the top downwards, so that the shifting line between Comfort" and poverty nowhere discloses a small oligarchy of 0 all-possessing capitalists. One strength of .private capitalism is that it. cannot fie overthrown without overthrowing a multitude of small capitalists who have acquired savings. The "directing capitalists at the top have a financial stewardship for the small-savings capitalists, who may be depositors, shareholders, bondholders, etc.,_and who are a powerful minority in any modern country^ influential beyond their' numbers. And-the directing capitalists—indeed, all capitalists—have a moral stewardship for the whole community, in assuring a fair balance .of wage, price, and profit, as elements in the standard of living of those who are not in any way capitalists. If a country that hag abolished private capitalism, substituting State or bureaucratic capitalism,' could show a higher standard of living than in private capital countries, a new argument would enter. It does not seem to have entered yet. ' ' Communism generally -regards the small capitalist as its greatest enemy. ! The small capitalist cannot easily be I convinced that he would fare better i under State ■ capitalism than under private capitalism. The small capitalist cannot as a rule be held up as an example*" of greed, and cannot be made.a target for attack in the way that the big capitalist has been. Very frequently the small capitalist reflects civic virtues in an outstanding degreed He can make both landlordism and capitalism respectable. Virtues- of industry, perseverance, temperance, and character are his. Probably the difference between him and the fellow-wage-earner who started level with him is that he saved some of his substance instead of consuming- it all. "Social reformer" cannot attack him for that, unless they-attack all thrift (which some of them do). Having borne the heat, and burden of the day, successfully, the small capitalist is generally a realist, not easily caught by, Communist catch-cries. So the Communists cannot either cajole him as if he were a "wage-slave" or threaten'him as if he were a mono-' polist. It is not true that he "has' nothing to. lose but his chains." His electoral .importance is such that he i is a. continual check" on Communist1 tendencies within Labour parties—as' a result of which former Labour politicians like theßt. Hon. J. H. Thomas drew down upon' themselves the vitriol of Leon Trotsky; and it Is disturbing to think what Trotsky would say of Sir Walter Citrine if the exile from Russia wrote "'another book on England. Break into the problem from this political angle and you at ! once find, behind the Thomases and the Citrines, ihe British small-saver capitalist, the brake on extremism.

In Britain a huge part of capital belongs to the small man. This applies both to fixed capital and to that: part of capital which" the "nationalisers of credit" would liketo control. In the /'Nineteenth Century" Sir Geoffrey Ellis, M.P.. maintains that these small capitalists do not prefer politicians to commercial men as controllers of their credit and investments. He-quotes Sir Waldron Smithe'rs, M.P., to the effect that in Britain the total savings of .the;people are 3000 millions and he asks:

Is it seriously-questioned that this capital sum does not belong to those who have saved it, and that it should not be at their disposition through the investment machinery which they have been instrumental in erecting,- and which they trust on well-tried results? He believes that the small savers would sooner continue to-stand in with the capitalist system of which they are a; part-^-each part being necessary to the other—than le»ve control to the whim of passing Governments.

Who are these savers? Where are their savings? . They are of every type and come from every class/ but the great bulk are. weekly wage-earners, depending for their "employment on the success of industry, which is measured in the long run by its ability to make profits. Moreover, it is frequently forgotten that reserves of industry, its undistributed profits, have always suffered current income tax.

The small shareholder is in every company, and, since his shareholding

is his only property,-is.more vitally interested in ihe success of the system than is the big shareholder. Sir Geoffrey Ellis thinks that 'the next election in Britain "may well turn on the right of the saver to his own savings, and on the immunity from political interference of the investments into which those savings have been incorporated."

I The structure which hinds the few j large capitalists and the increasing i number of small capitalists is of .peculiar strength. As long, as if is mutually beneficial to them, Communists will find the alliance hard to break. But it is an alliance dependent on the mutual good'faith of the allies. The great mass of- small investors are compelled to trust the directing figures. Business complexities and competition are • such that management must in many cases be secretive, moves must be masked behind holding companies, and the small investors are therefore an army thrown more or less oh "the mercy of their leaders. Directors of business and commerce and finance and big capitalists generally should strive to remove the gambling element and to reduce investment risks and dishonesty losses. They owe this to themselves as well as to the small investor, for the small investor, from this point of view, is a principal reason why the big one continues to exist. If Krueger principles became general, and if business degenerated entirely into a jungle, the small investor might as well court a political-tiger as a financial one. The danger to capitalism therefore lies as much within itself as- outside it. A recognition of stewardship— of a trust held for the small investor and for the community, which has a right to demand community service—is a duty inherent.' Its neglect will assuredly open the gates to .the enemy.