Perpetual Change Of The Social Structure





Perpetual Change of the Social Structure



We confine ourselves to

that economic society par excellence which we have called the

industrial center of the world. In this region economic influences are

forever changing the very structure of the society itself. They move

labor from place to place in the system and they transfer capital to

and fro in the same way. If we think of our table of groups and

subgroups as representing the whole of this great industrial world, we

must think of labor and capital as in a perpetual flow from subgroup

to subgroup, making some industries larger and others smaller by

reason of every such movement. The great force of labor and the fund

of capital are like restless seas whose currents carry the water

composing them now hither and now yon as the direction and force of

the moving influences change.



Movements of Labor within the Group System caused by Increasing

Population



If the population were to increase while the amount of

capital and the mode of using it remained the same, the effect would

be a downward movement of both labor and capital in the series of

subgroups by which we represent industrial society. Labor and capital

would tend to desert the subgroups A''', B''', and C''' in our

table and to move to A, B, and C:--



A''' B''' C'''

A'' B'' C''

A' B' C'

A B C



Causes of Downward Flow of Labor in the Group System



A larger

population means, of course, not merely an increase in the amount of

labor performed, but also an increase in the number of consumers. It

means more mouths to feed and more bodies to clothe. It entails also,

according to principles that we have already studied, a lower earning

power and a lower rate of pay for labor. This means that simple food,

cheap clothing, inexpensive houses, furnishings, etc., constitute a

larger element in the consumers' wealth of society than they have

heretofore done. Society uses fewer luxuries and more necessaries, and

the necessaries of life are products in which raw materials

predominate and costly form utilities are wanting. This makes a

heavier draft upon the land than does the production of highly wrought

articles of the same value.



Luxurious articles are fashioned with a great amount of artisan's or

artist's labor and a relatively small amount of the labor of

cultivators and miners. The subgroups A, B, and C are the ones

that furnish the rawest materials, and it is they, therefore, that

receive the largest portions of the new labor that enters the field.



How Economic Friction works to the Disadvantage of

Immigrants



Unless capital grows more rapidly than population, there

is a certain friction to be overcome in obtaining places for new

laborers. If they come largely as immigrants, they are crowded at the

points of disembarkation and are then scattered over a large

territory. They may have to gain employment by offering to

entrepreneurs some inducement to take them. If capital has not

increased, and the entrepreneurs are in no special need of new men,

they will take them only at a rate of pay which is low enough to

afford of itself a slight margin of profit. If the capital has already

grown larger and the new men are needed, the situation favors them,

and their pay is likely to be as high as it was before, or higher.



The Effect of Increasing Capital



The growth of capital has an

opposite effect. It means a lower rate of interest, though it means

more interest in the aggregate, since it insures a larger fund on

which the interest is received. The rate does not decline as rapidly

as the amount of the fund increases, and this insures a larger gross

income from the fund; and it also insures larger individual incomes

for many persons. There is, then, a large number of people who are in

a position to make their consumption more luxurious, and this causes

an upward movement of labor and capital in the group system. More

workers will be needed in the subgroups A''', B''', and C''',

where raw materials receive the finishing touches, and also in the

other subgroups above the lowest tier. It is to these subgroups that a

large portion of the new capital itself will come, and the labor will

come with it. Larger incomes, more luxury, more labor spent in

elaborating goods as compared with that required for procuring crude

materials,--such is the order.



Effect of an Increase of Both Labor and Capital



It is clear that a

certain increase of capital might practically neutralize the increase

of population, in so far as the movements thus far considered are

concerned, and a greater increase of capital would reverse the

original downward movement caused by the increase of labor and result

in a permanent upward movement toward the subgroups A''', B''',

and C'''. In this case the men occupy themselves more and more in

making the higher form utilities. They make finer clothing, costlier

furniture, etc., and the new production requires proportionately less

raw material than did the old. This is the supposition which

corresponds to the actual facts. Capital is increasing faster than

labor, and consumption is growing relatively more luxurious;

dwellings, furnishings, equipage, clothing, and food are improving in

quality more than they are increasing in quantity. Goods of high cost

are predominating more and more, and the subgroups that produce them

are getting larger shares of both labor and capital. Population drifts

locally toward centers of manufacturing and commerce. It moves toward

cities and villages in order to get into the subgroups which have

there their principal abodes. The growth of cities is the visible sign

of an upward movement of labor in the subgroup series.



A Change in the Relative Size of General Groups



If all the steady

movements of labor and capital were stated, it would appear that a

relative increase in the amount of labor, as compared with the amount

of capital, would enlarge the three general groups, AA''', BB''',

and CC''', and reduce the comparative size of the general group

HH''', which maintains the fund of capital by making good the waste

of active instruments. Gain in capital estimated per capita would

cause relatively more of the labor and more of the fund of capital to

betake itself to the group HH'''. The movement toward the upper

subgroups which is actually going on is attended by a drift toward

this general group. An increase of luxurious consumption and an

enlargement of the permanent stock of capital goods go together.



Regularity and Slowness of Movements caused by Changes in the Amounts

of Labor and Capital



The important fact about the movements thus

far traced is that they are steady and slow. They do not often call

for taking out of one part of the system mature men who have been

trained to work there. They are movements of labor which do not, in

the main, involve any considerable moving of laborers from group to

group. The sons of the men in the subgroup A do not all succeed to

their fathers' occupations, but many of them enter A', A'', and

A''', so that labor moves from the lowest subgroup to higher ones.

Such a transfer of labor entails few hardships for any one, and in

general it is to be said that all the movements of labor and capital

which are occasioned by quantitative changes in the supply of these

agents are of this comparatively painless and frictionless kind. About

changes caused by new methods of production there is a different story

to tell. The transformation of the world does not go on without some

disquieting results, however inspiring is the remote outlook which

they afford. The irregularity of the general movement, the fact that

it goes by forward impulses followed by partial halts, is a further

serious fact. Hard times present their grave problems, and we need to

know whether it is necessary that dynamics--the natural and forward

movement of the industrial system--should produce them. This problem

is for later consideration.



Movements caused by Changes in the Processes of

Production



Mechanical inventions are typical movers of labor and

capital--constant disturbers of what would otherwise be a

comparatively tranquil state. Dynamos for generating electricity and

devices for conducting it to great distances from its sources have

done much to rearrange the society of a score of years ago, as

economical steam engines had done at an earlier date. Every device

that "saves labor" calls for a rearrangement of labor in the system

of organized industry.



In a perfectly static condition there would be, as we have seen, a

standard shape for all society, which means a normal apportionment of

labor and capital among the producing groups and subgroups and also

among the local divisions of the general area. The elements would

subside to a state of equilibrium and become motionless, as water

finds its level and becomes still in a sheltered pool. The body of

fluid takes its standard shape and retains it, so long as no

disturbing force appears. Now, society would have such a standard

shape and would require, in the absence of dynamic changes, a

relatively short time in order to conform more or less closely to it,

if it were not for the unnatural apportionment of population in

different parts of the area that the society inhabits and the

obstacles which wholesale migrations encounter. For the solution of

problems of the present and the near future we must accept as a

standard the quasi-static adjustment of the population and the

consequent quasi-static selection of industries in the different local

divisions of the broad area--the arrangement that we have described as

locating an excess of manufacturing in the more densely peopled areas

and an excess of agriculture in the more sparsely settled ones. With

this qualification it may be said that there is a standard

apportionment of labor and capital among the producing groups, and

that these agents gravitate powerfully and even rapidly toward it. If

there were a certain amount of labor and capital at A, a certain

amount at B, and so throughout the system, this standard shape would

be attained, and the elements would not move, except as a very slow

movement would be caused by changes in the comparative density of

population of different regions.[1] This standard shape would long

remain nearly fixed if it were not for the appearance of the dynamic

influences which are so active within the area we are studying.



[1] It is obvious that capital as well as population is

distributed with uneven density over the territory occupied

by society; but the movement of capital is less obstructed

than that of a great body of people, and moreover it is

chiefly the fact that the people are not dispersed over the

area in a natural way which creates the chief obstacle to the

moving of capital. It goes easily when it accompanies a

migration of laborers.



Alternations in the Direction of Movements caused by Improved

Methods



In a dynamic state this standard shape itself--the

approximately static one--is forever changing. At one time, for

example, conditions exist which call for a certain amount of labor at

A, another amount at B, etc. A little later these respective

quantities at A, B, etc., are no longer the natural or standard

quantities; for something has occurred that calls for less labor at

A, more at B, etc. If A represents wheat farming, the amount of

labor that it required when grain was gathered with sickles is more

than is necessary when it is gathered with self-binding reapers,

always provided that there has been no increase in population, which

would require an increase in the food supply. The society therefore

will not be in what has now become its standard shape till men have

been moved from the wheat-raising subgroup to others.



If the invention of the reaper were not followed by any others and if

no other disturbing changes took place, labor would move from the one

group, distribute itself among others, and bring the system to a new

equilibrium; but it has not time to do this. It begins to move in the

way that the new condition occasioned by the introduction of the

reaping machine impels it to move; but before the transfer is at all

complete there is a new invention somewhere else in the system that

starts a movement in some other direction. Before the labor from A

is duly distributed in B, C, etc., there is an invention in B

which starts some of it toward other points.



Why Movements are Perpetual as well as Changeful



Such improvements

are perpetual, and the dynamic society is not for an instant at rest.

If the disturbing causes would cease, the elements of the social body

would find their abiding place; and the important fact is that at any

one instant there is such a resting place for each laborer and each

bit of capital in the whole system. As we have seen, the men and the

productive funds would go to these points but for the fact that before

they have time to reach them new disturbances occur that call them in

new directions. Again and again the same thing occurs, and there is no

opportunity for placing labor and capital at exactly the points to

which recent changes call them before still further improvements begin

to call them elsewhere.



Why Technical Changes are more disturbing than a General Influx or

Efflux of Population



When the moving of labor is gradual, it is

effected, not so much by transferring particular men from one

occupation to another, as by diverting the young men who are about

entering the field of employment to the places where labor is most

needed. When the son of a shoemaker, instead of learning his father's

trade, becomes a carpenter, no laborer has abandoned an accustomed

occupation and betaken himself to another; but labor has gone from

the shoemaking trade to that of carpentering. A man often stays where

he is to the end of his life, although during that life labor has

moved freely out of his occupation to others. If we represent the

facts by a diagram, they will stand thus:--



A B C D



50 40 70 100 Natural and actual apportionment of labor

in 1850.



45 35>-->90 90 Natural apportionment after change of

----------^ ^---- method in 1850.



47 38 80 95 Apportionment in 1855 when the movement

initiated in 1850 is partially completed.



52 41<---65 102 Natural apportionment in 1855, with

^---------- ----^ movements then initiated.



A, B, C, and D represent different occupations or subgroups in

the table we have before used. At one date a static adjustment called

for fifty units of labor at A, forty at B, seventy at C, and one

hundred at D. A half decade later, after improvements had taken

place at A, B, and D, static forces, if they were allowed to

have their full effect, would leave only forty-five men at A, and

thirty-five at B, but they would place ninety at C and at D.

The first movements that would tend to bring this about are in the

direction indicated by the dotted lines. The transfers are made, not

by forcing men from A, B, and D to C, but chiefly by diverting

to C young laborers who would otherwise have gone to A, B, and

D to replace men who are leaving in these groups.



Now, before the transfers are completed something happens that calls

for a different movement. Let us say that only three units of labor

have as yet gone from A to C instead of five, leaving forty-seven

at A; only two have gone from B, leaving thirty-eight; and only

five have gone from D, leaving ninety-five at that point. Eighty

would then be at C, and the static adjustment would not have been

perfectly attained. It is at this point that a new change of

conditions occurs, which calls for fifty-two units at A, forty-one

at B, sixty-five at C, and a hundred and two at D. C now

contributes something to A and B, but it gives more to D; and

the fluctuations go on forever. Particular men may, more often than

otherwise, stay in their places, since the incoming stream of new

labor, by going where it is needed, may suffice to make the

adjustments, in so far as they are gradually made; but labor, in the

sense of the quantum of energy embodied in a succession of generations

of men, is never at rest. It is a veritable Wandering Jew for

restlessness and in a perpetual quest of places where it can remain.

Moreover, there are to be taken into account changes so sudden that

they thrust particular workers from one group to another.



A Perpetual Effort to conform to a Standard Shape which is itself

Changing



We think, then, of society as striving toward an endless

series of ideal shapes, never reaching any one of them and never

holding for any length of time any one actual shape. One movement is

not completed before another begins, and at no one time is the labor

apportioned among the groups exactly in the proportions that static

law calls for. Men are vitally interested to know what they have to

hope for or to fear from this perpetual necessity that some labor

should move from point to point.



Questions concerning the Effects of these Transformations



These

changes of shape involve costs as well as benefits. The gains are

permanent and the costs are transient, but are not for that reason

unimportant. They may fall on persons who do not get the full measure

of the offsetting gains. What we wish to know about any economic

change is how it will affect humanity, and especially working

humanity. Will it make laboring men better off or worse off? If it

benefits them in the end, will it impose on them an immediate

hardship? Will it even make certain ones pay heavily for a gain that

is shared by all classes? Are there some who are thus the especial

martyrs of progress, suffering for the general good?



Natural Transformations of Society increase its Productive

Power



There is no doubt that the changes of shape through which the

social organism is going cause it to grow in strength and efficiency.

More and more power to produce is coming, as we have seen, in

consequence of these transmutations. They always involve shifting

labor about within the organization and often involve shifting

laborers, taking some of them out of the subgroups in which they are

now working and putting them into others, something that cannot be

done without cost.



Immediate Effects of Labor Saving



Inventing a machine that can do

the work of twenty men will cause some of the twenty to be discharged.

They feel the burden of finding new places, and if they are skilled

workmen and their trade is no longer worth practicing, they lose all

the advantage they have enjoyed from special skill in their

occupations. Do they themselves get any adequate offset for this, or

does society as a whole divide the benefit in such a way that those

who pay nearly the whole cost get only their minute part of the gain?

Is there unfair dealing inherent in progress in the economic arts, and

must we justify the movement only on the ground of utility, though

knowing that a moralist would condemn it? These are some of the

general questions that are to be decided by a study of this phase of

economic dynamics. We need to know both what the movement will in the

end do for humanity and what it will at once do for particular

workmen.[2] In addition to ascertaining what the ultimate results of

the movement will be, we need to trace, with as much accuracy as is

possible, the effects of the disturbances that are involved in

generally beneficent changes.



[2] Our study may lead to a moral verdict without being

itself an ethical study; we limit the inquiry to questions of

fact, but perceive that some of the facts are of such a kind

that they must lead a reader to condemn or approve the social

economic system.





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