cause of better distributions of labour. It might be a wiser policy to quicken and strengthen its operation.

The remedy, as far as things permit of a remedy, lies, not in increasing the barriers which now prevent labour from being influenced by every turn of the market, but in endeavouring to remove them; in other words, we should aid and not thwart the law of economic levitation. It is not good policy to exclude workers from a trade either by trade unionism or by minimum-wages legislation. People only go to work in a trade because they can find no better. The fairly good wages which prevail in many trades where trade unions exist are not due to trade unionism. On the contrary, trade unions are due to the fairly high wages which market conditions have already established in those trades. When a new trade or a new process is established and proves profitable, the only way in which an employer is able to get competent workmen is by offering some inducement to workers to leave their present occupation and to enter a new one. This almost invariably means a rise of wages-a rise for those who enter the new trade and a rise also for the reduced numbers that remain in the old occupations. In the classical instance of agriculture, agricultural wages are better in districts where there is a constant drift of labour to manufacturing occupations. Now no new trade which is at all flourishing thinks itself complete without its union-an institution for many purposes very useful, and one which in any case is well within the rights of the labourer; but, without doubt, one effect of the union is that a barrier is set up to the influx of labour from lower levels of remuneration. This is quite natural on the part of those in possession; but is it just and wise in the general interest of labour?

We are aware that in many trades more or less dominated by trade unions no action is taken by trade unions to restrict the number of workers, except in so far as the union has been able to enforce a minimum rate of wages, a policy which would tend to exclude the less efficient and to prevent employers from taking on learners. So long as this policy is not maintained by illegal methods, and so long as it is content to work without the assistance of legislation, we have nothing to say against it, except that we question its wisdom in the

interest of the working class as a whole. Our contention is that a higher general level of wages will be reached by allowing the labour-flow to run as the market calls. The man who accepts the hint given by the prevalence of low wages, and leaves, or prevents his children being bound to, agricultural labour, and who obtains better remunerated work elsewhere for himself and family, not only relieves the agricultural labour market and makes a rise there possible, but he and his imitators all through the industrial system are, by means of their higher wages, exerting a more effective demand for each other's labour. It is not an answer to our argument to say that, as, for instance, in the cotton industry, there is no monopoly claimed for the workers. Our point is that we question the policy of any insistence on a minimum rate of wages which must inevitably have the effect of preventing the attraction of labour from lower levels-labour which, ex hypothesi, is unskilled and only employable, in the first instance at all events, at wages lower than the normal.

This policy of keeping a monopoly for a certain set of workers by trade union regulations as to apprenticeship, or by maintaining a rate of wages prohibitive to the employment of willing workers from lower levels of the industrial community, is an injury to the cause of labour in two respects. It stands arbitrarily in the way of the promotion of the lower-paid tradesmen, and it prevents the growth and increase of the funds on which industry and employment largely depend. Our foreign trade is a bagatelle relatively to our home trade; and our home trade, representing as it does about seven-eighths of the industrial effort of the community, is largely devoted to catering for the industrial classes. The expansion of our home trade, it is not too much to say, depends almost entirely on the increased purchasing power of the labouring class.

It is in this direction that we shall find the only possible solution of the often-stated problem. Given a body of unemployed workmen, unshod, unclothed, badly housed-required the formula which will enable them to exchange the produce of their labour. We are disposed to argue that at present one of the hindrances to making effective the natural demand of this class is to be found in the too numerous barriers which are interposed here

and there, and on various pretexts, to absolute freedom of contract in the matter of the exchange of services for wages. The question of the provision of capital in these days of highly developed facilities for credit presents very little difficulty. An assured and effective demand for the commodity to be manufactured is sufficient guarantee for the production of the needed capital. Credit, in such circumstances, is a perfect substitute for capital in the sense in which the word is ordinarily understood. The two conditions needed for the fresh inception and indefinite expansion of industry are (1) reasonable security for honest commercial enterprise, and (2) a gradual increase in the purchasing power of the mass of the population. It is with this second condition that we are here mainly concerned; and our argument is that this increase will be greatly facilitated if we adopt, in respect of labour, the policy which allows the principle of (what we have called) levitation to exercise its influence.

A natural presumption in favour of liberty, based, as we submit, on sound philosophical reasoning and confirmed by experience, supplies a generalisation sufficiently cogent to govern, for some minds, the whole situation; but, if justification is demanded by a body of unionists who see their occupation invaded, as they think detrimentally to their interest, by workers from a lower stratum, the answer is that their compensation will come from the quickened demand for labour which must be the result of the increased wages of any section of the labouring class. A momentary lowering of wages in the invaded trade may take place, but it will find relief by the constant drift of the population towards the better remunerated trades, and by the stoppage of fresh enlistment in response to the tendency of wages to fall. This, we submit, is what has happened, and is happening, notwithstanding the impediments that nature and artifice have put in the way of this better distribution of labour. This is the only explanation which fits the facts.

The prediction of Marx that, inasmuch as the labourer was at a disadvantage in the open market, a society based on freedom of exchange was hastening to dissolution and ruin, has been falsified by events. The truer doctrine is that in every exchange both parties profit; and that labour, as a mobile and convertible force, is Vol. 210.-No. 418.

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enabled to be constantly attaining a better market—a market which it itself supports by the increased purchase power which higher wages puts at its disposal. A true analysis of the situation brings out in a most prominent light the inherent mutuality of the principle of free exchange. The socialist ideal, on the other hand, is based entirely on force; and the advantage which, as we contend, it vainly imagines, does not differ from the result which must necessarily follow from the successful removal of the friction that impedes the operation of an absolute freedom of exchange.

It is often objected that it is extremely difficult for a grown man to change his trade. No doubt the subdivisions of labour are real divisions; and the initial friction which prevents one market from merging entirely in another is considerable. This friction, however, though it cannot be ignored, ought not to be exaggerated. It is sufficient to prevent tumultuous invasion, but it is not sufficient to prevent all change of employment, nor to hinder deliberation in the choice of a trade made by parents on behalf of their children. It is with the young labour, for the most part, that more favourable adjustments are made. In any case, the difficulty, such as it is, ought not to be artificially preserved and fostered. Theoretically-and with the removal of occasions for friction practice tends to conform to theory-freedom of exchange with regard to labour, mutatis mutandis, acts somewhat in the same way as a free mint acts towards bullion. It will pass labour into currency in the form in which it is most wanted and for which there is the best remuneration; and this continuous rise into the better remunerated industries automatically provides an increased purchasing power for the products of the more domestic trades, which also, as a rule, are those employing the largest amount of labour.

One other consideration should be added to any argument in defence of the open market. An advocate of free exchange will not be content to found the prosperity of labour entirely on wages. Man is a capital- or tool-owning as well as a labouring animal; and, though we may reject the pessimistic views of Marx, which he borrowed, with exaggerations, from Ricardo and others,

it is undoubtedly true that the power to earn wages is not necessarily permanent, and that the full stature of a civilised man is not reached till he is able to purchase leisure and some relaxation of toil by the accumulation of savings. Socialist speakers and writers are fond of reproaching those who adhere to the advocacy of free exchange, on the ground that their views are belated and out of date; but in this particular point the socialist controversialist has revived one of the most dismal but happily exploded fallacies of the older so-called orthodox economists, namely, that wages are regulated by the cost of the labourer's maintenance. Happily it is not the case that wages adhere to the level which gives a bare livelihood to the worker; but on this assumption socialist controversialists have based their theory of the so-called parasitic trades-that is, trades in which it is alleged that workers who have incomes or maintenance derived from sources other than their wages underbid those who live entirely on their wages.

It is part of the general policy of legislating unsatisfactory employments out of existence, to regulate industries carried on in the home and to prohibit such as are 'parasitic,' in the sense that they do not afford those who follow them a living or a minimum rate of wages. The real truth is that, in nine cases out of ten, the possession of an independent income or of a maintenance in the house of parents or friends helps to keep the worker out of the poorest markets for labour. The cause of low wages is a redundant supply of labour in a given market, the inability of the population to distribute itself to more advantage. The remedy is not prohibition, which causes a twofold and irreparable impoverishment, first of income for the worker, and second of purchasing power for the rest of the community. The remedy is a better distribution of labour; and the only clear indication that we get as to the line on which better distribution should proceed, is given us by the rise and fall of wages in the open market. Anything that tends to keep people working at an unprofitable trade is bad policy. Outdoor relief to the able-bodied under the old poor law did undoubtedly increase the congestion of the market and retarded the growth of the new industry by keeping a pauperised population stagnating in the rural districts. The same