WAGES AND PRODUCTION.

Evening Star, Issue 19275, 14 June 1926, Page 4

WAGES AND PRODUCTION.

TO THE EDITOU.

gj r> , “ E.W.F.” declares that “it will alwayfbo impossible for the worker or producer to purchase the product of his labor, no. matter what system, Capitalistic or Socialistic, is in operation.” But you. in reviewing The Secret of High Wages,’ declare that it proves “ that it is possible for the wage earner to purchase the product of his labor,” and that under Capitalism.I am with “E.W.F.” to that extent when he says that it is impossible for the workers' en masse to buy back what they have produced under Capitalism. But I will maintain that under a state of Socialism the workers or producers en masse would receive and participate freely in what they had produced, for they would have produced it all for that very purpose —i. 0., for uso, and not for profit. If this state of things did nob come’ about, then it would not be Socialism. Ho draws my attention to that great middle class of “ workers,” such as clerks, accountants, doctors, lawyers, who produce nothing, yet aro “ necessary _to production.” Leaving over the inclusion of lawyers and insurance agents amongst “those necessary to production,” we will examine the logic of these statements* (we are not interested in his “amazed disgust” or anything). How is it for logic when lie declares that “ there is a class of workers who produce nothing” yet aro “necessary to production ”? Is it not evident that if they be “necessary” then they are to that extent “ producers of wealth”? I am aware of that great and everincreasing army operating in the Capitalistic system, which cannot by any stretch of the imagination bo designated “ producers.” The existence of this army constitutes one of the greatest condemnations of Capitalism as a system. One of the statements in the book quoted reads: “The extent of a market depends on the ability to produce, which also determines the standard of living.” Now, it seems to mo that some of your correspondents aro mixing up things a little bit in connection with the words “ desire ” and “demand.” It should be borne in mind that while there is a very large or relatively illimitable “ natural ” desire or demand, the Capitalistic market cannot recognise it as an effective one, seeing that it is not backed by the purchasing power. So that it seems to me that the “extent” of an _ effective market, under present conditions, depends rather more on an effective purchasing power than on the ability to produce. The workers do not possess that effective purchasing power. Here in New Zealand to-day, in the matter of house supply, there is an ineffective but natural demand for over 25,000 houses. Why is this so? Why aro these houses not being built? The overcrowding threatens the life of the nation. It is the most important thing to attend to at present. Capitalism stands in the way. It says; “No! there is no profit in building, at present, such a largo number of houses; who are going to buy them?” In effect it says we are not out to meet, a natural want unless there is profit in the doing of it. Tho two delegates, whoso book you quote, were sent over to the United States by tho London ‘Daily Mail.’ Their remarks on what is taking place there are interesting, as affording a glimpse into the mind of two Conservative working men. Of course they will praise a return _to piece-work. Tho payment of high wages, they declare, is made possible by “ greater and yet greater production ” —shall we say “ ad infinitum ” ? And with this movement will go as concomitants an ovor-increo.sing_wnges bill per capita and an ever-swelling of profits. I like tho largeness of this statement. lam afraid, however, that tho same fate awaits America ns was wished once to its mythical eagle when it was being toasted- by a fullblown patriot. Ho was well primed with a certain liquor. Ho had just about exhausted all the virtues of tho bird, and started on “ May it spread its wings, and spread its wings, and spread its wings ” when a Britisher, who was getting a bit fed up, interjected “Till it bursts itself.” These two working men delegates have not tho understanding to recognise that the United States is engaged in what will prove to bo an industrial sprint; that for the moment it is going well, having had a flying start since the war. But what is going to bo done with the everincreasing profits? Are these going to bo invested to return “ over-increas-ing ” profits and so on? Tho truth is, I think, that America is where Great Britain was some decades ago. Her 1 condition cannot last, for her surplus,' despite what the delegates say, will rise up, and if she cannot find an outside dumping ground will choke and clog her. Sho knows this, and is making' ready, as a Capitalist country must, to be prepared for the next great fight for territory in which to dump her surplus. It appears to me that she is treating the workers in a very liberal fashion, if all be true that the delegates say, and as a result of this hoping, when the call to arms resounds, tho workers will realise they have something to fight for. In conclusion, I notice “ E.W.F. ” states that there is an accumulating surplus which is eaten up by “non-producers” who are “necessary” to production, and by the “idle rich classes” and “profiteering middlemen,” and we learn from him that all these_ gentry perform a very useful function in so doing, otherwise industry or production would he strangled. As a plain man, it seems to me an infinitely better plan to put the aforementioned gentry to work, and thereby lessen the sum total of hours necessary for an efficient system of production and distribution. T trust that “ E.W.F. will have lost his feeling of hopelessness, for I have recognised and dealt with facts.—l am., etc., John Gilchrist.

Juno 12. [Tin's correspondence is now dosed.— Ed. E.S.]