W.E.A.

Hawera Star, Volume XLVIII, 26 June 1924, Page 10

W.E.A.

“THE CONTROL OF INDUSTRY.” At the weekly meeting of the Hauer a W.E.A. Class on Thursday last the tutor, Mr W. A. Sheat, 8.A., LL.B., lectured upon ‘‘The Control of Industry. ’ Up till recent years, said the lecturer, business life had been conducted in the great industrial countries with considerable security and efficiency' under a system of control that was definitely autocratic. An employer or manager with capital owned by him or entrusted to his care bought or hired business premises,, bought the necessary machinery and raw materials, anci hired workers of- various grades of intellect and manual capacity to produce goods or services which could he sbld at prices which, after paying all necessary costs of would yield a profit. The aim and end of a business was profit to the person or persons who supplied the capital. To keep down costs and to keep up profits were the objects of the employer. In order to keep down costs he had to retain in his own hands all decisiois regarding the technique and organisation of production, factory discipline, buying and selling, and the whole business of finance. The government of industry was ip accordance with this scheme necessarily autocratic. The business belonged to the person or persons who supplied the capital ■ it existed in order to produce profit for them. The services it rendered to the public by turning out goods and to the employees by furnishing wages and employment were subordinate to the main purpose of profit-making. Neither the workers regularly employed in the business nor the public, which had become dependent upon the purchase of its goods or services had any legal or other recognised right or claim'- upon the business. The owner could shut it down ,ur transfer it elsewhere, or alter its character, affecting vitally the interests of the employees, the local inhabitants, or consumers. Rut none of these had, or, according to thojfcnerally accepted view, ought to have, any voice iii the matter. The system, however, did not operate so badly as this bare account might indicate. The employees, the consumers, the public were safeguarded in their interests by a certain amount of consistency between the profit-making motive and the interests of the other parties concerned. So far as fairly free competition prevailed and approximate equality of opportunity, tlm autocratic organisation of business with profit-making as its end appeared to work with fair success, securing substantial justice to all. It was recognised even by those who' made this claim that certain defects prevented the system of free comeptition from working complete justice to all, but these, defects were regarded as such as would be overcome by the spread of educational and ;ot-her opportunities. Not until the close of last century was this complacent attitude seriously shaken. Rut the apparent arrest in working-class progress beginning about the year 1896 had destroyed the general faith in the old underlying harmony whereby the interests of all were safeguarded, even when each sought first its own interests. In fact developments that had already commenced and had since* proceeded much further, had destroyed the basis upon which the old theory depended. Competition, instead of becoming freer owing to the equalising of opportunities, lmd been greatly restricted by the growth of combines in many directions, so that, the old safeguard of the public interests was no longer operative to the same extent. The most characteristic feature of industrial development in the last half century had been the growth of collective auction in all departments. Hitherto competing business had either entirely eliminated competition, or relegated it from the sphere of price to less important matters." Organisations for controlling output had become common, especially in some of the vital 'industries. This great growth of combination had removed or diminished some of the incentives to efficiency claimed for the competitive system, and had left the consumer without Iris former protection against excessive prices. More and more the strain of competition was falling, not upon the several businesses and several employees within a trade, but upon the several trades. Trades were coming to compete with one another by display of relative economic strength for the largest share of the aggregate income they could get, both labour and capital in industries of fundamental importance to the whole community being in a position to exploit the needs of the community. The steady elimination of free comeptition was raising to special prominence the question of the place of the State in industry. The old theory was that the sole function of the State was to “keep the ring” for the free play of competitive forces. With the passing of “free competition” this neutral attitude was becoming inadequate. The need for some more positive action on the part of the State, as representing the consumer, was becoming more closely recognised. It was evident that where monopoly developed in “key” industries, private enterprise would sooner or later be subjected to a considerable measure of public control, even if it were not definitely superseded by complete nationalisation of the industries concerned.