Voluntary Socialism

A SKETCH (1896)

by Francis Dashwood Tandy (1867-1913)

Chapter XII.

Transportation, Etc.

VS-12.1 It is claimed by many that certain industries cannot be made subject to competition, that they are in their very nature monopolies, and consequently, the arguments introduced in the last chapter can in no manner apply to them. It is claimed that, in spite of the abolition of rent and interest, these industries will yield a profit which cannot be abolished except by collective control. Railroads, telegraphs, telephones, water-works, express companies and other similar industries constitute this class of alleged “natural monopolies.”
VS-12.2 With brazen effrontery, those who advocate State ownership of these industries point to the present postal system as an example of the beneficence of State interference. So reconciled is the average man to the existing way of doing things, that he does not realize the evil of it, unless he has special reason to Investigate it. This explains why such impudent assertions about the post office pass almost unchallenged in our midst, and also constitutes my excuse for attacking that much praised institution before proceeding further.
VS-12.3 We need not expect to find either good business management or common honesty in an institution, when the head of that institution obtains his position by pure and simple purchase. The appointment of John Wanamaker as postmaster general should have. been enough to arouse the most unsuspicious. The Star Route rascalities seem to be altogether forgotten. [Online editor’s note: Wealthy businessman and union-buster John Wanamaker (1838-1922); during his term as Postmaster General (1889-1893) he protected the public from receiving lottery tickets or Tolstoj’s Kreutzer Sonata in the mail. The Star Routes scandal involved the awarding of government contracts in exchange for bribes. – RTL] The short-comings of the system are transformed into virtues in the eyes of its worshipers. In order to exist at all it has to tax all competitors out of the market. But this tax, though especially designed to prevent competition, is not always sufficient to save it, so poor is its service in comparison to that given by private corporations. Mr. Tucker tells us: “Some half dozen years ago,1 when letter postage was still three cents, Wells, Fargo & Co. were doing a large business in carrying letters I throughout the Pacific States and Territories. Their rate was five cents, more than three cents of which they expended, as the legal monopoly required, in purchasing of the United States a stamped envelope in which to carry the letter intrusted to their care. That is to say, on every letter which they carried they had to pay a tax of more than three cents. Exclusive of this tax, Wells, Fargo & Co. got less than two cents for each letter which they carried, while the government got three cents for each letter which it carried itself, and more than three cents for each letter which Wells, Fargo & Co. carried. On the other hand, it cost every individual five cents to send by Wells, Fargo & Co. and only three to send by the government. Moreover the area covered was one in which immensity of distance, sparseness of population, and irregularities of surface made out-of-the-way points unusually difficult of access. Still, in spite of all the advantages on the side of the government, its patronage steadily dwindled, while that of Wells, Fargo & Co. as steadily grew. ... The postmaster general sent a special commissioner to investigate the matter. He fulfilled his duty and reported to his superior that Wells, Fargo & Co. were complying with law in every particular, and were taking away the business of the government by furnishing a prompter and securer mail service, not alone to the principal points, but to more points and remoter points that [Online editor’s note: Tandy’s error for “than.” – RTL] were included in the government list of post offices.” (Instead of a Book, p. 121.) [Online editor’s note: It’s surprising that Tandy makes no mention of Spooner and the American Letter Mail Company. – RTL]
VS-12.4 In Wichita, Kansas, during the boom in 1886, the postal accommodation was very inadequate. The post office was situated in the rear of a store. There was no free delivery and the number of boxes was very limited. The line of people waiting for their mail often used to reach out onto the sidewalk, and sometimes, half a block along the street. Petition after petition was forwarded to Washington but without avail. Finally, however, the requests were heeded. Better arrangements were made and a free delivery system was established – three months before the boom collapsed. The express companies, meanwhile, had enlarged their offices and staffs of clerks as the business required it. When the conditions changed, they transferred their employes to places where their services were needed. The same conditions exist now in Cripple Creek, Colorado. Owing to the mining boom, the business of this postoffice has rapidly increased, but the facilities are so inadequate that it is impossible to transact the business. One enterprising man has started a delivery system on his own account and is making big money at it. He is now hiring others to help him. How long could this last in a business that is subject to competition? These are characteristic cases. Private institutions are run for profit. If not conducted on business principles, competition will force them to the wall. With a governmental institution this is different. It is not subject to competition. It is operated at the people’s expense, and due care must be exercised to prevent extravagance in the use of the people’s money! But while that care is being exercised, conditions change and the machinery of the institution is too slow to adapt itself to them. This is no little detail, it is a vital flaw in the system. If due care is not exercised, the robbery will be infinitely worse than at present; if it is exercised, the institution lacks the necessary flexibility and is unable to readily adapt itself to changed conditions.
VS-12.5 The express companies will deliver a package of prepaid printed matter weighing 1 1-2 lbs. for 10 cents, in any part of the United States. The post office charges 12 cents for the same service. Furthermore, the express companies will give a receipt for the package and pay damages if it is lost, which the government will not do even if the package is registered. The manuscript of this book will weigh between 3 1-2 and 4 lbs. when it is finished – say 3 1-2 lbs. To send this by mail would cost me two cents per ounce, that is $1.12, with 8 cents extra for registration makes a total of $1.20. I can send this package by express if it weighs less than 4 lbs., including full insurance against loss, for 60 cents. Wells, Fargo & Co. have offered to carry letters for one cent per ounce if the government will remove the tax. Yet, in spite of the fact that the government charges twice as much as the express companies would, it lost in 1894 over $9,200,000, which sum the working men had to pay in taxes. How is this accounted for? Simply by the fact that all governmental undertakings are run for boodle and not on business principles.
VS-12.6 One of the most glaring examples of the bribery of this institution is seen in the regulations in regard to second class matter. Why does the government charge me two cents per ounce for my private correspondence? Yes, more than this, for if I write ten letters, the total weight of which is but 4 ounces, and even if I mail them all at once, I have to pay twenty cents for them. But a newspaper corporation can send its payers at one cent per pound and have them all weighed in bulk. Why is this? Because the government is afraid of the press of the country and gives it this bribe, for which we all have to pay indirectly by taxes. Even this is not the worst, as it does not accord this privilege to all publications indiscriminately, but by offering it to one journal and denying it to another, the party in power is often able to crush what it considers objectionable sheets.
VS-12.7 The powers of the postmaster general are greater even than this. Not only can he exclude papers from transmission under the second class rates, he can even exclude them from the mails alt6gether. If the matter treated of in papers is antagonistic to popular prejudice in regard to sexual affairs, he can even cause the person mailing the papers to be tried on a criminal charge. By these means a regular censorship of the press is instituted, for all other institutions, which would be willing to carry the mails without asking any questions, are taxed out of the field. This is the way the post office is “collectively owned by the people!” It is run by a set of disreputable politicians in the interest of big newspaper corporations, and labor has to foot the bill.
VS-12.8 But, it is argued, civil service reform will mend all this. I deny this emphatically. In England civil service reform principles are in operation in the post office, and yet the rates there are about the same as here. The service to the public is no better, but condition of the employes is worse. About a year ago “The New York Sun” published the following: “The regulations of the British post office require that every unsound tooth shall be taken out of a man’s head before he can be employed. An unfortunate girl, who was recently examined for promotion, had fourteen teeth taken out at one sitting by order of the official dentist, who explained that ‘we can’t have girls laid up with toothache.’” What if the Western Union Telegraph Co. treated its employes in the same way? Oh, yes! Civil service reform is a great thing, I assure you. Its whole basis is a system of competitive examinations, one of the greatest absurdities of modern times, well worthy of the Chinese bureaucracy in which it originated. A knowledge of geometry is no criterion of executive ability, nor is a smattering of natural science, diluted with Christianity, essential to a good letter carrier. Who ever heard of civil service reform in a private enterprise? There is no need of it. The managers know that it is to their interests to promote their most competent employes, and they act accordingly. But this is not so with any governmental undertaking. There, either political influence or ability to pass some absurd examination, are the tests of merit. Our experience with the post office is not such as to warrant us in experimenting any more in this line.
VS-12.9 Apart from the post office, nearly all the administrative departments of the government are vested in municipal corporations. In fact, municipal governments are almost purely administrative. It would be through their agency that most of these industries would be operated were they placed under State control. Yet Bryce [Online editor’s note: British jurist and historian James Bryce (1838-1922). – RTL] tells us: “There is no denying that the government of cities is the one conspicuous failure of the United States.” (American Commonwealth, v. 1, p. 608.) Are we to entrust to these monumental failures more than they already mismanage? The present condition of affairs is bad enough. To increase the powers of the State will only make it worse. The remedy must be sought in the opposite direction. Much of the evil resulting from these industries is due to the action of municipal and State governments, in granting a franchise to one company and denying it to all competitors.
VS-12.10 The history of the water works of Denver contains a very good lesson. When the Denver Water Company started in business, it charged $7.00 per season of six months for supplying water to a seven or eight room-house (without bath). The water was taken out of the Platte river, just above the city, and was of very poor quality. The machinery used was not equal to the demand made upon it, and, in short, the whole system was unsatisfactory. Fortunately the city is so situated that excellent water can be struck in any locality at a depth of less than one hundred feet. Taking advantage of this fact, the owners of large buildings sank artesian wells. Owing to lack of patronage, the Denver Water Company failed, and the business was purchased by the American Water Company. This new company immediately cut prices twenty per cent., put in new filters and better machinery, and commenced work to take water from Cherry creek, where a better quality could be obtained. (This last enterprise was abandoned, however, owing to litigation.) In about 1890, after a long fight with the city, during which that protector of monopolies tried to tear up its pipes, a new company managed to secure a franchise and started a lively competition. It took its water from the foot hills, conducted it to the city through pipes, and secured sufficient force from gravitation to render pumping engines unnecessary. They relied upon the superior quality of their water to defeat the American Company. This resulted in the latter company reducing their rates to fifty per cent. of the old schedule, instead of eighty per cent. The cut was met by the new concern, which afterwards gave their water free to whoever would connect with their main. The American Water Company then cut their last rate fifty per cent. (making it only twenty-five per cent. of the original rate). This was the condition for over a year; one company giving water free, the other charging only twenty-five per cent. of their original rate. The American Company subsequently failed and went into the hands of a receiver. Then the two companies consolidated and the rates were soon increased. One safeguard still remains – the possibility of digging wells. But even this is in danger of being removed by the monopoly-protecting State, for a city ordinance is on the records which empowers the Health Department to close up wells within the city limits. While the outcome of this is what might be expected under the present financial system, yet the whole business shows us what may be done with “natural monopolies” when a little competition is permitted, even under the present system.
VS-12.11 In this same city of Denver, two distinct street car companies are competing with each other. While this competition has not resulted in any reduction of fares, it has given the public better accommodation.
VS-12.12 If such competition is possible, even in rare instances, under present financial conditions, it cannot be said that these industries are natural monopolies. When credit is freed from the throttling grasp of Government, when land is open to the producers of wealth, when the protective tariff is abolished, and patents and copyrights are things of the past, then may we look up and lift up our heads, for our redemption draweth nigh, even from the oppression of “natural monopolies.” [Online editor’s note: Paraphrase of Luke 21:28. – RTL]
VS-12.13 Given free land and free money, and how long do you suppose the inhabitants of any town would pay exorbitant rates for transportation? If the railroads did not reduce their prices to cost, the inhabitants of that town would soon organize a competing company and run the “monopolist” out of the business. Nor would it be necessary, in most cases, to build a competing road, the very threat of doing so would usually be enough.
VS-12.14 Difficulties will no doubt arise from time to time. But under free conditions we will ever be gaining experience, which will enable us to meet them. This experience would be impossible under our present restricted conditions. Many failures may be made, but even they can hardly be worse than our present system. There being no rigid system of State control to prevent the immediate application of a remedy to those failures, they will but prove stepping-stones to success. For success can only be achieved by the survival of the fittest.
VS-12.15 The objections above set forth to State control, do not, of course, apply to the voluntary association of any number of individuals. This voluntary cooperation will probably play an important part in the solution of these problems. In Denver in 1893 – and no doubt similar conditions have been experienced in other places at various times – the City government had squandered all the money it had collected and had nothing left to pay for street cleaning. What was the result? The business men living in each block subscribed to have the streets cleaned. If the men they employed did not perform the work to their satisfaction, they got others who did. Here is another instance of individual initiative stepping to the front and performing “the functions of the State” after the decrepit machinery of that institution had broken down. To be sure, in some cases, a man would not co-operate with others, and they had to bear his share between them, or let the street go dirty. Naturally they chose the former course. This may appear to be a little unfair, and so it was. But not half as unfair as it was for the City to tax them all to clean the streets, and then not do it. Besides, in the former case they were not compelled to pay unless they wished to do so, but in the latter case they had no choice in the matter whatsoever.
VS-12.16 There is still another factor which must not be overlooked; that is the development of machinery. Owing to the difficulty of conducting steam any great distance, this power must be used where it is generated or great loss results. And, as small quantities cannot be generated economically, the introduction of steam necessitated large factories. But electricity is of a different character. Though, like steam, it can be generated more economically in large quantities, yet, unlike steam, it can easily be transmitted over comparatively long distances with but little loss of power. This enables many small manufacturers to gain the advantage of a motive power to be used in their business, and makes it possible for them to compete with larger institutions. While steam has had a tendency to concentrate wealth, electricity may tend to decentralize it. This same tendency may be found in a large number of modern inventions. For example, the bicycle is already seriously affecting the profit of street car companies. When the tariff on them is removed, and the monopolies of land and money are abolished, the price of bicycles will probably be but a small portion of that demanded to-day. This will result in a very great increase in their use. Several different motor-cycles, or horseless carriages, propelled by oil, compressed air, electricity, etc., and capable of traveling at the rate of 20 or 30 miles per hour, are now on the market. These will still further affect the street cars, when they can be made cheaply enough to be within the reach of men in ordinary circumstances. Recent experiments with flying machines have also met with much success, and it is no longer doubted that aerial navigation will be an accomplished fact early in the next century. If this is so, it will materially increase the possibility of competition in transportation. Many large buildings are now supplied with electrical plants, which they use for lighting and other purposes. In some instances, as above mentioned, such buildings even supply themselves with water. It is by no means impossible, that before State ownership of railroads, street cars, gas and water works, etc., becomes possible, there will be no railroads, street cars, etc., for the State to own.
VS-12.17 A large number of men demand State ownership of these industries, as a means of immediate relief from some of the social evils which beset us, and as a stepping-stone to something better. These men are, as a rule, fully convinced of the truth of the Socialistic theory of surplus value. They realize that as long as rent and interest remain unmolested, nothing can be of any but the most trifling importance. They know also that, to-day at any rate, no matter what they may hope for in the future, politicians are strictly dishonest, mere hirelings of capital and “master workmen” of the brotherhood of thieves. What can they expect from handing over “natural Monopolies” to the mercy of such an outfit? The business will assuredly be mismanaged, and the loss made up by taxes which must in the ultimate be paid by labor, while any advantage that may possibly be derived will just as surely be reaped by the landlord and money-lender. Even supposing that the postal system is all that the State Socialists claim for it. they cannot show that it has affected surplus value in the slightest, except as affording an opportunity for fat contracts to railroad corporations. For what more may we hope from similar “reforms?”
VS-12.18 Spencer shows us what the result of such extension of State functions must be. He sums up his case in these words: “The extent to which an organization resists re-organization, we shall not fully appreciate until we observe that resistance increases in a compound progression. For while each new part is an additional obstacle to change, the formation of it involves a deduction from the forces causing change. ... So that, inevitably, each further growth of the instrumentalities which control, or administer, or inspect, or in any way direct social forces, increases the impediment to future modifications, both positively by strengthening that which has to be modified, and negatively by weakening the remainder; until at length the rigidity becomes so great that change is impossible and the type becomes fixed.” (Principles of Sociology, v. 2, pp. 255-256.)
VS-12.19 Let it further be noted that that which is thus strengthened is not the ideal of the State Socialist, but the head centre of the present iniquitous system. Thus the Opportunist and all his ilk are not only hindering the Anarchists from the attainment of their ends, but are handicapping State Socialists and other reformers in a similar manner.
VS-12.20 These “steps forward” can do no possible good to labor, and only result in strengthening the present State, the arch enemy of all reform. and so we fight them to the last.
VS-12.21 Others, again, urge State ownership as a means of preventing strikes. But these gentlemen seem to be ignorant of the fact that in July, 1890, the postmen of London went on strike. It was not for any paltry raise of wages, either, but for the right to organize. The secretary of the Postmen’s Union gives his side of the story in “The Nineteenth Century” for July, 1890. He says: “In the opinion of Mr. Raikes (then postmaster general) the postmen may have a union on condition that its secretary is appointed by the department, that it holds no meetings, that it makes no appeal to the public, and that it makes no attempt to better the condition of its members.” The attitude assumed by Col. Waring, who at present has control of the street cleaning department in New York, seems to be modeled on the same plan, if the current reports of his utterances are correct. What would our labor union friends say if Pullman or Carnegie wanted to appoint the secretaries of their employes’ unions?
VS-12.22 During the same month (July, 1890,) the policemen at the Bow Street police station and the Grenadier Guards, in London, and the teamsters in the street cleaning department, in New York, also went on strike; but in each case, the “disturbance” was quelled in a few days, and any organization of the men nipped in the bud. Oh, yes, State ownership will certainly prevent strikes! The workers then won’t have even that chance, poor as it is, of bettering their conditions. See how the State ownership of the postoffice offered an excuse for calling out the Federal troops to suppress the A. R. U. strike in 1894. Will the wage earners never learn anything from experience? Surely the spoils system is elaborate enough already, without any further extension of its tyranny!
VS-12.23 Once settle the land and money questions, and all these minor problems will adjust themselves, Until these two monopolies are abolished, all tinkering I these minor problems will adjust themselves. Until with these questions can be of little avail and may result in grievous and permanent harm.

VS-12.n1.1 1 This was written in 1887.

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