in the country as distinguished from the land-owning farmer. The old
order is one of perfect democracy, in which the laboring-man is a part
of the farmer's family. It is not to be expected that this condition can
continue in its old form, but the probability is that there will always
be a different relation between working-man and employer in the country
from that which obtains in the city. The relation will be more direct
and personal. The employer will always feel his sense of obligation and
responsibility to the man whom he employs and to the man's family.
Persons do not starve to death in the open country.
Some persons think that the farming of the future is still to be
performed on the family-plan, by which all members of the family perform
the labor, and whatever incidental help is employed will become for the
time a part of the family. This will probably continue to be the rule.
But we must face the fact, however, that a necessary result of the
organization of country life and the specialization of its industries,
that is now so much urged, will be the production of a laboring class by
itself.
_Supervision in farm labor._
It is doubtful whether we shall extend the industrial organization of
labor to the open country, and yet there should be some way of
administering farm labor. The growth of the tendency to coördinate
farming industries, in order to overcome the disastrous effects of much
of the competitive farming, will allow for supervision of labor,
however, and will make for efficiency. The standardizing of agricultural
practice will also do much to produce the community mind that is so much
desired (p. 97). On this line, Dean H. E. Cook, who has given much
thought to labor questions, writes me as follows:
"The production of iron, paper, and manufactured products generally has
been standardized, and the cost laid down in the market is well known,
and therefore placed squarely on a cash basis. Directly the opposite is
the case in the manufacture of farm crops, and so we find the family to
be the farm crop-producers. The wife and the children are a part of the
working force of the farm, which is not found in any other industry. In
fact, our laws are very rigid in preventing the employment of women and
children in nearly every class of work, except on the farm. We find no
provision by statute or moral sentiment which says that the farmer must
not employ his eight- or ten-year-old boy, as is very often the case, in
most laborious tasks. This state of affairs is not the desire of the
farmer, but has become a necessity because of the very low prices for
his products, occasioned by the intense competition of the rapidly
extending area. Our government has taken every means within its grasp to
populate these large areas of cheap rich land. Of course it meant wealth
to the nation, but it meant poverty to those who had established homes
and investments in the older sections.
"Our methods, unlike other manufacturers and producers, are not
standardized. That is, we find in every community persons having each
his own conception of soil-handling, crop-growing, and marketing. In a
single locality can be found an endless variety of corn, as an
illustration. Especially is this true in the East. Surely corn growing
fourteen feet high and corn growing six feet high are not calculated to
bring the same results. The farmers themselves are unlike. I suppose we
are distantly removed from the time when we shall have a uniform type of
men and women bred for the farm. It seems to me that methods which would
unify or standardize our practices and prices--within certain
limitations, to be sure--would tend to unify the tendencies and the type
of the people.
"In our present state of undevelopment or adjustment, I do not think it
is possible profitably to pursue the production of crops with employed
labor, such as we find in our manufacturing establishments; and it may
be debatable whether that plan would be an improvement, so far as the
social life is concerned, over the present family-plan, although I
firmly believe that the time is approaching when the profits of the
business will warrant a cash payment for everything done on the farm. As
a connecting link between the family-plan and the future cash-plan, it
seems to me we ought to take on in each neighborhood the same methods
of supervision that are now employed in the factories. One man of skill
and adaptability supervises the work of many. In agriculture we have but
one illustration of this principle, namely, our butter and cheese
factories, where one man has in charge the manufacturing of the milk of
many. I think we could profitably use a similar agency in trucking,
soil-handling, crop-growing, animal-feeding, and general
farm-management. Furthermore, we are more in need, as the writer sees
it, of this standardizing or coöperation in farm-management, than we are
in the manufacture of milk products. This plan would use the family as a
unit of labor on the farm, with the attendant light risk, or no risk at
all; and in case of failure of crops of having to pay cash for the
labor.
"The cow-test association is a part of this general plan of local
supervision. I can foresee how there may come out of this cow-test
movement, a growth which will mean just what I have tried to outline.
The man who does nothing now but the testing of the milk from each cow
may develop into an expert who will give advice on soils, crops,
cow-feeding, and other things (page 123).
"When the communities around certain natural centers, as the cheese
factories or creameries in dairy sections, perhaps a small hamlet in
trucking sections, have become thoroughly organized or, more properly
speaking, standardized, we shall find it comparatively easy to bring a
number of these local units together, because the individuals who form a
part of the movement have learned the true principles underlying
coöperation. Until these local units are worked out, in my opinion we
shall never be able to form any great coöperative movement which will
not break of its own weight, because of a lack of annealing processes."
_What is the farmer to do?_
"How may I secure labor?" is probably the most persistent question now
asked by farmers; but it is a question that cannot be answered, any more
than one may tell another what crops he shall grow, what markets he
shall find, or what manner of house he shall build. This is one of the
great problems of farming, as it is of engineering, of the building
trades, and of factories. Each farmer must work it out for himself, as
he works out the problem of fertility and machinery. He must work far
ahead, and consider it as a part of all his plans.
In many or most cases, it resolves itself into a question of
personality,--of making a place that is worth while to a good man and
then of the farmer interesting himself in the man. One can now hardly
expect to secure labor on demand for brief periods, for the scheme of
things is more and more in the direction of continuous employment; and
the old range of prices cannot hold. If the farmer's scale of business
is small and operates only for a part of a year, he cannot expect to
secure the best and most reliable help.
The farmer will find increasing aid from public labor-distributing
bureaus, for these agencies must extend with the extension of population
and the complexity of industry. In time, the state and nation will
provide competent machinery for placing working-men where they can best
serve themselves and society, thus relieving both employer and employed
from much waste of effort. As farm labor is not a separate difficulty,
the problem will tend to better and better solution along with the rest.
If the distributing agencies are not now wholly satisfactory, the farmer
must recognize that they are only beginning, and that he should
coöperate with them. The problem of utilizing the immigrant, for
example, is one of distribution; but distribution is really not
accomplished merely by sending a certain number of immigrants to a
certain number of places,--immigrant and employer must find the
situation to be mutually satisfactory.
Any effort which assumes that labor must necessarily come to the
old-type farm, is only temporary. The farm must readjust itself to meet
the labor problem. In the meantime, through the labor bureaus, by
looking long ahead, by organizing a labor club in the community, by some
person acting as a labor agent and supplying farmers as they need, by
trying to make a year-round activity in the neighborhood, the situation
may be met more or less.
THE MIDDLEMAN QUESTION
To make farming profitable is no longer a question merely of raising
more produce. We have passed that point. We now have knowledge and
experience enough to enable us greatly to increase our yields, if only
we put the knowledge into practice.
_Farmer does not get his share._
But the farmer, speaking broadly, does not get his share of the proceeds
of his labor, notwithstanding the increase in the price of farm
products. A few farmers here and there, producing a superior article and
favored by location or otherwise, can be quite independent of marketing
systems; but the larger number of farmers never can be so situated, and
they must grow the staples, and they are now at the mercy of many
intermediaries. The farmer's risks, to say nothing of his investment and
his labor, are not sufficiently taken into account in our scheme of
business,--risks of bad years, storm, frost, flood, disease to stock and
crop, and many things over which he has practically no control.
A merchant in a small city may want as much as twenty per cent
commission to sell produce, and then retain the privilege of returning
to the grower all the product that spoils on his hands or that he is
unable to sell; he invests little capital, takes no risk, and makes more
than the man who buys his land, prepares the crop months in advance, and
assumes every risk from seed-time to dinner-table. I am citing this case
not to say that it is a subject for public control nor even to assert
that the merchant's commission is intrinsically too great, but only to
illustrate the disadvantage in which the farmer often finds himself; and
the farmer may even have no escape from this disadvantage, for all the
merchants within his market region may agree to sell his produce only on
such terms, and he may be obliged to accept these terms or not to sell
his wares.
The manufacturer knows the cost of his products and charges his price.
The farmer usually does not know the cost, and in general he makes no
selling price; the prices of his staple produce are made for him.
That the producer does not secure his proportionate share of the selling
price in many products is a matter of the commonest knowledge, and much
study has been made of the question. If the question is put in another
way, the consumer pays too great a margin, in great numbers of cases,
over the cost of production. The following press item, coming to my hand
as I write, is an example (given for what it is worth), although not
extreme: "The government of New York, and not the government in
Washington, is where the people of this city must look, if they expect
to see reduction in living expenses. A bushel of beans, for which the
producer in Florida receives $2.25, with the transportation 50 cents for
the 800-mile haul, should not cost the New York consumer $6.40 a bushel.
The producer receives 35 per cent of the final price, the transporter 8
per cent, and the dealers 57 per cent. This is not a fair division. The
problem is not one of trusts, tariffs, and other Washington matters, but
simply one of providing straight and cheap ways open from all gardens
and farms to kitchens and tables."
The poorer the country or the less forehanded the people, the harder is
the pinch of the usurer and the trader, and all the machinery of trade
is likely to be manipulated against the defenseless man who stands
stolidly between the handles of the plow.
Of course, such conditions do not obtain with all products. In some of
the great staples, as wheat, the cost of transportation and commissions
is often reduced by competition and scientific handling to probably its
lowest terms. But that there are abuses and extortions, and remediable
conditions, in the middleman system--by which I mean collectively all
traders between producer and consumer--no one will attempt to deny. The
farmer cannot rise to his proper place until the stones are taken off
his back.
The abuses must be checked and discriminations removed, whether in the
middleman trade itself, rates of express companies and other carriers,
or stock-market gambling. The middleman system has had a free field to
play in, the wealth of the country to handle; it has exercised its
license, and in too many cases it has become parasitic, either protected
by law and custom or unreachable by law or custom. It is a shame that
our economic machinery is not capable of handling the situation.
_Relation of the question to cost-of-living._
It is customary just now to attribute the high cost of living to
lessened production due to a supposed decline of agriculture, and to
advise, therefore, that more persons engage in farming for the purpose
of increasing the product. This position is met by an editorial of the
New York Tribune, which holds that intermediary trading combinations are
responsible:
"It is true that the raising of cattle for the market has almost ceased
in the East and that agriculture generally has not kept pace with the
demand for food products. Yet it is hard to believe that agriculture in
any part of the Union would steadily decline in the face of an enormous
appreciation of the cost to the consumer of all farm products, were
there not some powerful disturbing factor operating to deny the farmer
the benefits of that appreciation. If the Eastern farmer could have
reaped a legitimate share of the increase in the price of farm produce
which has taken place in the last twenty years, he would certainly be in
position to command all the labor he needs and to develop resources now
neglected because it does not pay to develop them. Under normal
conditions economic law would certainly drive labor and energy into a
field of production in which there had been the greatest relative
expansion in the selling price of products.
"Yet economic law has not operated to stimulate agriculture, because the
returns from steadily mounting prices have not really reached the
producer. Thirty years ago the fattening of steers for the local markets
was common in the East. But when the vast Western ranges were opened,
and the great packing houses were established, the cheapness of range
beef, refrigerated and delivered in Eastern cities, was used as a weapon
to kill off the cattle industry of the East. When the Eastern cattleman
was driven out of business, the price of beef rose, but virtually all
the increase has gone to the packing combinations, which fix their own
price to the Western range man and their own price to the consumer and
artificially control the supply so as to discourage increased production
in the West and to prevent a revival of production in the East. The
country is growing in population at the rate of twenty to twenty-five
per cent each decade. But Secretary Wilson has shown that the supply of
food animals is not being maintained in proportion to population. In the
last decade cattle have remained about stationary in numbers, swine are
actually decreasing, and, while more sheep are available, the supply has
diminished relatively to population.
"It can hardly be contended that with steadily diminishing supplies and
steadily increasing prices the law of supply and demand would not work
out a new balance, stimulating production through easy profits, were
there no artificial interception of the producer's normal share of the
advance in price. Were there a free market for the Eastern raiser of
stock, milk, and food products generally, with the middleman's
commissions properly restricted, Eastern farming would probably be
profitable enough to hold its own against manufacturing and to compete
successfully with the manufacturer for labor."
_The farmer's part._
Of course, it is necessary to teach every farmer how to grow more crops,
for this is his business, and it also enlarges his personal ambition and
extends his power and responsibility; but merely to grow the crops will
not avail,--this is only the beginning of the problem: the products must
be distributed and marketed in such a way that the one who expends the
effort to produce them shall receive enough of the return to identify
him with the effort. Thereafter, social and moral results will follow.
_The middleman's part._
I recognize the service of the middleman to society. I know that the
distributor and trader are producers of wealth as well as those who
raise the raw materials; but this is no justification for abuses. I know
that there are hosts of perfectly honest and dependable middlemen. We do
not yet know whether the existing system of intermediary distributors
and sellers is necessary to future society, but we do not see any other
practicable way at present. In special cases, the farmer may reach his
own customer; but this condition, as I have suggested, is so small in
proportion to the whole number of farmers as not greatly to affect the
general situation. We do not yet see any way whereby all farmers can be
so organized as to enable them to control all their own marketing.
Therefore, we must recognize middleman-practice as legitimate.
_A system of economic waste._
But even though we yet see no way of general escape from the system, we
ought to provide some means of regulating its operation. The present
method of placing agricultural produce in the hands of the consumer is
for the most part indirect and wasteful. Probably in the majority of
cases of dissatisfaction, the person whom we call the middleman does not
receive any exorbitant profit, but the cost of the commodities is piled
up by a long and circuitous system of intermediate tolls and
commissions.
_Coöperation of farmers will not solve it._
It is commonly advised that farmers "unite" or "organize" to correct
middleman and transportation abuses, but these troubles cannot be solved
by any combination of farmers, because this is not an agricultural
question. It is as much a problem for consumers as for producers. It is
a part of the civilization of our day, completely woven into the fabric
of our economic system. The farmer may feel its hardship first because
he must bear it, while the consumer, to meet higher prices, demands more
pay of his employer or takes another stitch out of somebody else. But it
is essentially a problem for all society to solve, not for farmers
alone, particularly when it operates on a continental basis. This also
indicates the futility of the arbitrary control of prices of the great
staples by combinations of farmers (page 126).
Of course, temporary or local relief may be secured by organizations of
producers here and there, or of consumers here and there (probably
consumers can attack the problem more effectively than producers), and
by the establishment of public markets; but no organization can
permanently handle the question unless the organization is all the
people.
The present agitations against middleman practices and stock-market
gambling ought to compel Congress to pass laws to correct the evils that
are correctable by law, and the organizations then should keep such
touch on the situation that the laws will be enforced.
It has been suggested that the superabundant middlemen go into farming;
but no one can compel them to go to farming, and they might not be
successful farmers if they should attack the business, and the farming
country might not need them or profit by them,--for it is not
demonstrated that we need more farmers, although it is apparent that we
need better farmers.
_It is the business of government._
It is the business of any government to protect its people. Governments
have protected their countries from invasion and war, but the greatest
office of government in modern times is to develop its own people and
the internal resources of its realm. We are beginning to protect the
people from the over-lording of railroads, from unfair combinations in
trade, and from the tyranny of organized politicians. It is just as much
the business of government to protect its people from dishonest and
tyrannous middlemen lying beyond the practical reach of individuals. The
situation has arisen because of lack of control; there is no conspiracy
against the farmer.
It is said that competition will in the end correct the middleman evil,
but competition does not correct it; and competition alone, under the
present structure of society, will not correct it in most cases because
"agreements" between traders restrict or remove competition: the
situation does not have within itself the remedies for its own ills.
When we finally eliminate combinations in restraint of trade, the
middleman abuses may be in the process of passing out. It is to check
dishonesty on the one hand and to allow real competition on the other
that I am now making suggestions.
_Must be a continuing process of control._
I have no suggestion to make as to the nature of the laws themselves.
There are many diverse situations to be met; and I intentionally do not
make my remarks specific. Of course, any law that really attempts to
reach the case must recognize the middleman as exercising a public or
semi-public function, and that, as such, he is amenable to control,
even beyond the point of mere personal honesty. The licensing of
middlemen (a practice that might be carried much further, and which is a
first step in reform) recognizes this status; and if it is competent for
government to license a middleman, it is also competent for it to
exercise some oversight over him. It is not necessary that government
declare an agency a monopoly in order to regulate it. Commercial
situations that unmistakably involve service to the public are proper
for governmental control in greater or lesser degree. The supervision of
weights and measures is a good beginning in the regulation of middleman
trading.
But the enactment of laws, even of good laws, is only another step in
the solution. A law does not operate itself, and the common man cannot
resort to courts of law to secure justice in such cases as these. There
must be a _continuing process_ of government with which to work out the
reform and to adjust each case on its merits. Whatever the merits of the
laws, their success lies in the continuing application of them to
specific cases by persons whose business it is to discern the facts
rather than to prove a case.
There are three steps in the control of the middleman: (1) an aroused
public conscience on the question; (2) good fundamental laws for
interstate phases and similar state laws for local phases; (3) good
commissions or other agencies or bodies to which any producer or
consumer or middleman may take his case, and which may exercise
regulatory functions. The interstate commerce commission has
jurisdiction over so much of the problem as relates to the service and
rates of common carriers; no doubt, its powers could be extended to
other interstate phases. Perhaps departments of agriculture, in states
in which public service commissions have not been established, could be
given sufficient scope to handle some of the questions.
Of course, some of the middlemen and associated traders will contend
that all this interferes with business and with private rights, but no
man has a private right to oppress or defraud another or to deprive him
of his proper rewards; and we must correct a faulty economic system.
There is little danger that the legitimate business of any honest
middleman will be interfered with.
I know that commissions and similar bodies have not always been wholly
successful. This is because we have not yet had experience enough, have
not consciously trained our people for this kind of work, and have not
been able to make water-tight laws. Neither do older systems now prove
to be adequate. New economic conditions must bring new methods of
regulation and control.