ECONOMIC CHANGE
One of the most interesting phenomena of modern world-history is the
twofold conquest of the East by the West. The word "conquest" is usually
employed in a political sense, and calls up visions of embattled armies
subduing foreign lands and lording it over distant peoples. Such
political conquests in the Orient did of course occur, and we have
already seen how, during the past century, the decrepit states of the
Near and Middle East fell an easy prey to the armed might of the
European Powers.
But what is not so generally realized is the fact that this political
conquest was paralleled by an economic conquest perhaps even more
complete and probably destined to produce changes of an even more
profound and enduring character.
The root-cause of this economic conquest was the Industrial Revolution.
Just as the voyages of Columbus and Da Gama gave Europe the strategic
mastery of the ocean and thereby the political mastery of the world, so
the technical inventions of the later eighteenth century which
inaugurated the Industrial Revolution gave Europe the economic mastery
of the world. These inventions in fact heralded a new Age of Discovery,
this time into the realms of science. The results were, if possible,
more momentous even than those of the age of geographical discovery
three centuries before. They gave our race such increased mastery over
the resources of nature that the ensuing transformation of economic life
swiftly and utterly transformed the face of things.
This transformation was, indeed, unprecedented in the world's history.
Hitherto man's material progress had been a gradual evolution. With the
exception of gunpowder, he had tapped no new sources of material energy
since very ancient times. The horse-drawn mail-coach of our
great-grandfathers was merely a logical elaboration of the horse-drawn
Egyptian chariot; the wind-driven clipper-ship traced its line unbroken
to Ulysses's lateen bark before Troy; while industry still relied on the
brawn of man and beast or upon the simple action of wind and waterfall.
Suddenly all was changed. Steam, electricity, petrol, the Hertzian wave,
harnessed nature's hidden powers, conquered distance, and shrunk the
terrestrial globe to the measure of human hands. Man entered a new
material world, differing not merely in degree but in kind from that of
previous generations.
When I say "Man," I mean, so far as the nineteenth century was
concerned, the white man of Europe and its racial settlements overseas.
It was the white man's brain which had conceived all this, and it was
the white man alone who at first reaped the benefits. The two
outstanding features of the new order were the rise of machine-industry
with its incalculable acceleration of mass-production, and the
correlative development of cheap and rapid transportation. Both these
factors favoured a prodigious increase in economic power and wealth in
Europe, since Europe became the workshop of the world. In fact, during
the nineteenth century, Europe was transformed from a semi-rural
continent into a swarming hive of industry, gorged with goods, capital,
and men, pouring forth its wares to the remotest corners of the earth,
and drawing thence fresh stores of raw material for new fabrication and
exchange.
Such was the industrially revolutionized West which confronted an East
as backward and stagnant in economics as it was in politics and the art
of war. In fact, the East was virtually devoid of either industry or
business, as we understand these terms to-day. Economically, the East
was on an agricultural basis, the economic unit being the
self-supporting, semi-isolated village. Oriental "industries" were
handicrafts, carried on by relatively small numbers of artisans, usually
working by and for themselves. Their products, while often exquisite in
quality, were largely luxuries, and were always produced by such slow,
antiquated methods that their quantity was limited and their market
price relatively high. Despite very low wages, therefore, Asiatic
products not only could not compete in the world-market with European
and American machine-made, mass-produced articles, but were hard hit in
their home-markets as well.
This Oriental inability to compete with Western industry arose not
merely from methods of production but also from other factors such as
the mentality of the workers and the scarcity of capital. Throughout the
Near and Middle East economic life rested on the principle of status.
The Western economic principles of contract and competition were
virtually unknown. Agriculturalists and artisans followed blindly in the
footsteps of their fathers. There was no competition, no stimulus for
improvement, no change in customary wages, no desire for a better and
more comfortable living. The industries were stereotyped; the apprentice
merely imitated his master, and rarely thought of introducing new
implements or new methods of manufacture. Instead of working for profit
and advancement, men followed an hereditary "calling," usually hallowed
by religious sanctions, handed down from father to son through many
generations, each calling possessing its own unchanging ideals, its
zealously guarded craft-secrets.
The few bolder, more enterprising spirits who might have ventured to
break the iron bands of custom and tradition were estopped by lack of
capital. Fluid "investment" capital, easily mobilized and ready to pour
into an enterprise of demonstrable utility and profit, simply did not
exist. To the Oriental, whether prince or peasant, money was regarded,
not as a source of profit or a medium of exchange, but as a store of
value, to be hoarded intact against a "rainy day." The East has been
known for ages as a "sink of the precious metals." In India alone, the
value of the gold, silver, and jewels hidden in strong-boxes, buried in
the earth, or hanging about the necks of women must run into billions.
Says a recent writer on India: "I had the privilege of being taken
through the treasure-vaults of one of the wealthiest Maharajahs. I could
have plunged my arm to the shoulder in great silver caskets filled with
diamonds, pearls, emeralds, rubies. The walls were studded with hooks
and on each pair of hooks rested gold bars three to four feet long and
two inches across. I stood by a great cask of diamonds, and picking up a
handful let them drop slowly from between my fingers, sparkling and
glistening like drops of water in sunlight. There are some seven hundred
native states, and the rulers of every one has his treasure-vaults on a
more or less elaborate scale. Besides these, every zamindar and every
Indian of high or low degree who can save anything, wants to have it by
him in actual metal; he distrusts this new-fangled paper currency that
they try to pass off on him. Sometimes he beats his coins into bangles
for his wives, and sometimes he hides money behind a loose brick or
under a flat stone in the bottom of the oven, or he goes out and digs a
little hole and buries it."[206]
Remember that this description is of present-day India, after more than
a century of British rule and notwithstanding a permeation of Western
ideas which, as we shall presently see, has produced momentous
modifications in the native point of view. Remember also that this
hoarding propensity is not peculiar to India but is shared by the entire
Orient. We can then realize the utter lack of capital for investment
purposes in the East of a hundred years ago, especially when we remember
that political insecurity and religious prohibitions of the lending of
money at interest stood in the way of such far-sighted individuals as
might have been inclined to employ their hoarded wealth for productive
purposes. There was, indeed, one outlet for financial activity--usury,
and therein virtually all the scant fluid capital of the old Orient was
employed. But such capital, lent not for productive enterprise, but for
luxury, profligacy, or incompetence, was a destructive rather than a
creative force and merely intensified the prejudice against capital of
any kind.
Such was the economic life of the Orient a hundred years ago. It is
obvious that this archaic order was utterly unable to face the
tremendous competition of the industrialized West. Everywhere the flood
of cheap Western machine-made, mass-produced goods began invading
Eastern lands, driving the native wares before them. The way in which an
ancient Oriental handicraft like the Indian textiles was literally
annihilated by the destructive competition of Lancashire cottons is only
one of many similar instances. To be sure, some Oriental writers contend
that this triumph of Western manufactures was due to political rather
than economic reasons, and Indian nationalists cite British governmental
activity in favour of the Lancashire cottons above mentioned as the sole
cause for the destruction of the Indian textile handicrafts. But such
arguments appear to be fallacious. British official action may have
hastened the triumph of British industry in India, but that triumph was
inevitable in the long run. The best proof is the way in which the
textile crafts of independent Oriental countries like Turkey and Persia
were similarly ruined by Western competition.
A further proof is the undoubted fact that Oriental peoples, taken as a
whole, have bought Western-manufactured products in preference to their
own hand-made wares. To many Westerners this has been a mystery. Such
persons cannot understand how the Orientals could buy the cheap, shoddy
products of the West, manufactured especially for the Eastern market, in
preference to their native wares of better quality and vastly greater
beauty. The answer, however, is that the average Oriental is not an art
connoisseur but a poor man living perilously close to the margin of
starvation. He not only wants but must buy things cheap, and the wide
price-margin is the deciding factor. Of course there is also the element
of novelty. Besides goods which merely replace articles he has always
used, the West has introduced many new articles whose utility or charm
are irresistible. I have already mentioned the way in which the
sewing-machine and the kerosene-lamp have swept the Orient from end to
end, and there are many other instances of a similar nature. The
permeation of Western industry has, in fact, profoundly modified every
phase of Oriental economic life. New economic wants have been created;
standards of living have been raised; canons of taste have been altered.
Says a lifelong American student of the Orient: "The knowledge of modern
inventions and of other foods and articles has created new wants. The
Chinese peasant is no longer content to burn bean-oil; he wants
kerosene. The desire of the Asiatic to possess foreign lamps is equalled
only by his passion for foreign clocks. The ambitious Syrian scorns the
mud roof of his ancestors, and will be satisfied only with the bright
red tiles imported from France. Everywhere articles of foreign
manufacture are in demand.... Knowledge increases wants, and the
Oriental is acquiring knowledge. He demands a hundred things to-day that
his grandfather never heard of."[207]
Everywhere it is the same story. An Indian economic writer, though a
bitter enemy of Western industrialism, bemoans the fact that "the
artisans are losing their occupations and are turning to agriculture.
The cheap kerosene-oil from Baku or New York threatens the oilman's[208]
existence. Brass and copper which have been used for vessels from time
immemorial are threatened by cheap enamelled ironware imported from
Europe.... There is also, _pari passu_, a transformation of the tastes
of the consumers. They abandon _gur_ for crystal sugar. Home-woven
cloths are now replaced by manufactured cloths for being too coarse. All
local industries are attacked and many have been destroyed. Villages
that for centuries followed customary practices are brought into contact
with the world's markets all on a sudden. For steamships and railways
which have established the connection have been built in so short an
interval as hardly to allow breathing-time to the village which
slumbered so long under the dominion of custom. Thus the sudden
introduction of competition into an economic unit which had from time
immemorial followed custom has wrought a mighty change."[209]
This "mighty change" was due not merely to the influx of Western goods
but also to an equally momentous influx of Western capital. The
opportunities for profitable investment were so numerous that Western
capital soon poured in streams into Eastern lands. Virtually devoid of
fluid capital of its own, the Orient was bound to have recourse to
Western capital for the initiation of all economic activity in the
modern sense. Railways, mines, large-scale agriculture of the
"plantation" type, and many other undertakings thus came into being.
Most notable of all was the founding of numerous manufacturing
establishments from North Africa to China and the consequent growth of
genuine "factory towns" where the whir of machinery and the smoke of
tall chimneys proclaimed that the East was adopting the industrial life
of the West.
The momentous social consequences of this industrialization of the
Orient will be treated in subsequent chapters. In the present chapter we
will confine ourselves to a consideration of its economic side.
Furthermore, this book, limited as it is to the Near and Middle East,
cannot deal with industrial developments in China and Japan. The reader
should, however, always bear in mind Far Eastern developments, which, in
the main, run parallel to those which we shall here discuss.
These industrial innovations were at first pure Western transplantings
set in Eastern soil. Initiated by Western capital, they were wholly
controlled and managed by Western brains. Western capital could not
venture to entrust itself to Orientals, with their lack of the modern
industrial spirit, their habits of "squeeze" and nepotism, their lust
for quick returns, and their incapacity for sustained business
team-play. As time passed, however, the success of Western undertakings
so impressed Orientals that the more forward-looking among them were
ready to risk their money and to acquire the technique necessary for
success. At the close of Chapter II, I described the development of
modern business types in the Moslem world, and the same is true of the
non-Moslem populations of India. In India there were several elements
such as the Parsis and the Hindu "banyas," or money-lenders, whose
previous activities in commerce or usury predisposed them to financial
and industrial activity in the modern sense. From their ranks have
chiefly sprung the present-day native business communities of India,
exemplified by the jute and textile factories of Calcutta and Bombay,
and the great Tata iron-works of Bengal--undertakings financed by native
capital and wholly under native control. Of course, beside these
successes there have been many lamentable failures. Nevertheless, there
seems to be no doubt that Western industrialism is ceasing to be an
exotic and is rooting itself firmly in Eastern soil.[210]
The combined result of Western and Eastern enterprise has been, as
already stated, the rise of important industrial centres at various
points in the Orient. In Egypt a French writer remarks: "Both banks of
the Nile are lined with factories, sugar-refineries and cotton-mills,
whose belching chimneys tower above the mud huts of the fellahs."[211]
And Sir Theodore Morison says of India: "In the city of Bombay the
industrial revolution has already been accomplished. Bombay is a modern
manufacturing city, where both the dark and the bright side of modern
industrialism strike the eye. Bombay has insanitary slums where
overcrowding is as great an evil as in any European city; she has a
proletariat which works long hours amid the din and whir of machinery;
she also has her millionaires, whose princely charities have adorned her
streets with beautiful buildings. Signs of lavish wealth and, let me
add, culture and taste in Bombay astonish the visitor from the inland
districts. The brown villages and never-ending fields with which he has
hitherto been familiar are the India which is passing away; Bombay is
the presage of the future."[212]
The juxtaposition of vast natural resources and a limitless supply of
cheap labour has encouraged the most ambitious hopes in Oriental minds.
Some Orientals look to a combination of Western money and Eastern
man-power, expressed by an Indian economic writer in the formula:
"English money and Indian labour are the two cheapest things in the
world."[213] Others more ambitiously dream of industrializing the East
entirely by native effort, to the exclusion and even to the detriment
of the West. This view was well set forth some years ago by a Hindu, who
wrote in a leading Indian periodical:[214] "In one sense the Orient is
really menacing the West, and so earnest and open-minded is Asia that no
pretence or apology whatever is made about it. The Easterner has thrown
down the industrial gauntlet, and from now on Asia is destined to
witness a progressively intense trade warfare, the Occidental scrambling
to retain his hold on the markets of the East, and the Oriental
endeavouring to beat him in a battle in which heretofore he has been an
easy victor.... In competing with the Occidental commercialists, the
Oriental has awakened to a dynamic realization of the futility of
pitting unimproved machinery and methods against modern methods and
appliances. Casting aside his former sense of self-complacency, he is
studying the sciences and arts that have given the West its material
prosperity. He is putting the results of his investigations to practical
use, as a rule, recasting the Occidental methods to suit his peculiar
needs, and in some instances improving upon them."
This statement of the spirit of the Orient's industrial awakening is
confirmed by many white observers. At the very moment when the above
article was penned, an American economic writer was making a study tour
of the Orient, of which he reported: "The real cause of Asia's poverty
lies in just two things: the failure of Asiatic governments to educate
their people, and the failure of the people to increase their productive
capacity by the use of machinery. Ignorance and lack of machinery are
responsible for Asia's poverty; knowledge and modern tools are
responsible for America's prosperity." But, continues this writer, we
must watch out. Asia now realizes these facts and is doing much to remedy
the situation. Hence, "we must face in ever-increasing degree the rivalry
of awakening peoples who are strong with the strength that comes from
struggle with poverty and hardship, and who have set themselves to master
and apply all our secrets in the coming world-struggle for industrial
supremacy and for racial readjustment."[215] Another American observer of
Asiatic economic conditions reports: "All Asia is being permeated with
modern industry and present-day mechanical progress."[216] And Sir
Theodore Morison concludes regarding India's economic future: "India's
industrial transformation is near at hand; the obstacles which have
hitherto prevented the adoption of modern methods of manufacture have
been removed; means of transport have been spread over the face of the
whole country, capital for the purchase of machinery and erection of
factories may now be borrowed on easy terms; mechanics, engineers, and
business managers may be hired from Europe to train the future captains
of Indian industry; in English a common language has been found in which
to transact business with all the provinces of India and with a great
part of the Western world; security from foreign invasion and internal
commotion justifies the inception of large enterprises. All the
conditions are favourable for a great reorganization of industry which,
when successfully accomplished, will bring about an increase hitherto
undreamed of in India's annual output of wealth."[217]
The factor usually relied upon to overcome the Orient's handicaps of
inexperience and inexpertness in industrialism is its cheap labour. To
Western observers the low wages and long hours of Eastern industry are
literally astounding. Take Egypt and India as examples of industrial
conditions in the Near and Middle East. Writing of Egypt in 1908, the
English economist H. N. Brailsford says: "There was then no Factory Act
in Egypt. There are all over the country ginning-mills, which employ
casual labour to prepare raw cotton for export during four or five
months of the year. The wages were low, from 7-1/2_d._ to 10_d._ (15 to
20 cents) a day for an adult, and 6_d._ (12 cents) for a child. Children
and adults alike worked sometimes for twelve, usually for fifteen, and
on occasion even for sixteen or eighteen hours a day. In the height of
the season even the children were put on night shifts of twelve
hours."[218]
In India conditions are about the same. The first thorough investigation
of Indian industry was made in 1907 by a factory labour commission, and
the following are some of the data published in its report: In the
cotton-mills of Bombay the hours regularly worked ran from thirteen to
fourteen hours. In the jute-mills of Calcutta the operatives usually
worked fifteen hours. Cotton-ginning factories required their employees
to work seventeen and eighteen hours a day, rice and flour mills twenty
to twenty-two hours, and an extreme case was found in a printing works
where the men had to work twenty-two hours a day for seven consecutive
days. As to wages, an adult male operative, working from thirteen to
fifteen hours a day, received from 15 to 20 rupees a month ($5 to
$6.35). Child labour was very prevalent, children six and seven years
old working "half-time"--in many cases eight hours a day. As a result of
this report legislation was passed by the Indian Government bettering
working conditions somewhat, especially for women and children. But in
1914 the French economist Albert Métin, after a careful study, reported
factory conditions not greatly changed, the Factory Acts systematically
evaded, hours very long, and wages extremely low. In Bombay men were
earning from 10 cents to 20 cents per day, the highest wages being 30
cents. For women and children the maximum was 10 cents per day.[219]
With such extraordinarily low wages and long hours of labour it might at
first sight seem as though, given adequate capital and up-to-date
machinery, the Orient could not only drive Occidental products from
Eastern markets but might invade Western markets as well. This, indeed,
has been the fear of many Western writers. Nearly three-quarters of a
century ago Gobineau prophesied an industrial invasion of Europe from
Asia,[220] and of late years economists like H. N. Brailsford have
warned against an emigration of Western capital to the tempting lure of
factory conditions in Eastern lands.[221] Nevertheless, so far as the
Near and Middle East is concerned, nothing like this has as yet
materialized. China, to be sure, may yet have unpleasant surprises in
store for the West,[222] but neither the Moslem world nor India have
developed factory labour with the skill, stamina, and assiduity
sufficient to undercut the industrial workers of Europe and America. In
India, for example, despite a swarming and poverty-stricken population,
the factories are unable to recruit an adequate or dependable
labour-supply. Says M. Métin: "With such long hours and low wages it
might be thought that Indian industry would be a formidable competitor
of the West. This is not so. The reason is the bad quality of the work.
The poorly paid coolies are so badly fed and so weak that it takes at
least three of them to do the work of one European. Also, the Indian
workers lack not only strength but also skill, attention, and liking for
their work.... An Indian of the people will do anything else in
preference to becoming a factory operative. The factories thus get only
the dregs of the working class. The workers come to the factories and
mines as a last resort; they leave as soon as they can return to their
prior occupations or find a more remunerative employment. Thus the
factories can never count on a regular labour-supply. Would higher wages
remedy this? Many employers say no--as soon as the workers got a little
ahead they would quit, either temporarily till their money was spent, or
permanently for some more congenial calling."[223] These statements are
fully confirmed by an Indian economic writer, who says: "One of the
greatest drawbacks to the establishment of large industries in India is
the scarcity and inefficiency of labour. Cheap labour, where there is no
physical stamina, mental discipline, and skill behind it, tends to be
costly in the end. The Indian labourer is mostly uneducated. He is not
in touch with his employers or with his work. The labouring population
of the towns is a flitting, dilettante population."[224]
Thus Indian industry, despite its very considerable growth, has not come
up to early expectations. As the official Year-Book very frankly states:
"India, in short, is a country rich in raw materials and in industrial
possibilities, but poor in manufacturing accomplishments."[225] In fact,
to some observers, India's industrial future seems far from bright. As a
competent English student of Indian conditions recently wrote: "Some
years ago it seemed possible that India might, by a rapid assimilation
of Western knowledge and technical skill, adapt for her own conditions
the methods of modern industry, and so reach an approximate economic
level. Some even now threaten the Western world with a vision of the
vast populations of China and India rising up with skilled organization,
vast resources, and comparatively cheap labour to impoverish the West.
To the present writer this is a mere bogey. The peril is of a very
different kind. Instead of a growing approximation, he sees a growing
disparity. For every step India takes toward mechanical efficiency, the
West takes two. When India is beginning to use bicycles and motor-cars
(not to make them), the West is perfecting the aeroplane. That is merely
symbolic. The war, as we know, has speeded up mechanical invention and
produced a population of mechanics; but India has stood comparatively
still. It is, up to now, overwhelmingly mediæval, a country of domestic
industry and handicrafts. Mechanical power, even of the simplest, has
not yet been applied to its chief industry--agriculture. Yet the period
of age-long isolation is over, and India can never go back to it;
nevertheless, the gap between East and West is widening. What is to be
the outcome for her 300 millions? We are in danger in the East of seeing
the worst evils of commercialism developed on an enormous scale, with
the vast population of India the victims--of seeing the East become a
world slum."[226]
Whether or not this pessimistic outlook is justified, certain it is that
not merely India but the entire Orient is in a stage of profound
transition; and transition periods are always painful times. We have
been considering the new industrial proletariat of the towns. But the
older social classes are affected in very similar fashion. The old-type
handicraftsman and small merchant are obviously menaced by modern
industrial and business methods, and the peasant masses are in little
better shape. It is not merely a change in technique but a fundamental
difference in outlook on life that is involved. The life of the old
Orient, while there was much want and hardship, was an easygoing life,
with virtually no thought of such matters as time, efficiency, output,
and "turnover." The merchant sat cross-legged in his little booth amid
his small stock of wares, passively waiting for trade, chaffering
interminably with his customers, annoyed rather than pleased if brisk
business came his way. The artisan usually worked by and for himself,
keeping his own hours and knocking off whenever he chose. The peasant
arose with the dawn, but around noon he and his animals lay down for a
long nap and slept until, in the cool of afternoon, they awoke,
stretched themselves, and, comfortably and casually, went to work again.
To such people the speed, system, and discipline of our economic life
are painfully repugnant, and adaptation can at best be effected only
very slowly and under the compulsion of the direst necessity. Meanwhile
they suffer from the competition of those better equipped in the
economic battle. Sir William Ramsay paints a striking picture of the way
in which the Turkish population of Asia Minor, from landlords and
merchants to simple peasants, have been going down-hill for the last
half-century under the economic pressure not merely of Westerners but of
the native Christian elements, Armenians and Greeks, who had partially
assimilated Western business ideas and methods. Under the old state of
things, he says, there was in Asia Minor "no economic progress and no
mercantile development; things went on in the old fashion, year after
year. Such simple business as was carried on was inconsistent with the
highly developed Western business system and Western civilization; but
it was not oppressive to the people. There were no large fortunes; there
was no opportunity for making a great fortune; it was impossible for one
man to force into his service the minds and the work of a large number
of people, and so to create a great organization out of which he might
make big profits. There was a very large number of small men doing
business on a small scale."[227] Sir William Ramsay then goes on to
describe the shattering of this archaic economic life by modern business
methods, to the consequent impoverishment of all classes of the
unadaptable Turkish population.
How the agricultural classes, peasants and landlords alike, are
suffering from changing economic conditions is well exemplified by the
recent history of India. Says the French writer Chailley, an
authoritative student of Indian problems: "For the last half-century
large fractions of the agricultural classes are being entirely despoiled
of their lands or reduced to onerous tenancies. On the other hand, new
classes are rising and taking their place.... Both ryots and
zamindars[228] are involved. The old-type nobility has not advanced with
the times. It remains idle and prodigal, while the peasant proprietors,
burdened by the traditions of many centuries, are likewise improvident
and ignorant. On the other hand, the economic conditions of British
India are producing capitalists who seek employment for their wealth. A
conflict between them and the old landholders was predestined, and the
result was inevitable. Wealth goes to the cleverest, and the land must
pass into the hands of new masters, to the great indignation of the
agricultural classes, a portion of whom will be reduced to the position
of farm-labourers."[229]
The Hindu economist Mukerjee thus depicts the disintegration and decay
of the Indian village: "New economic ideas have now begun to influence
the minds of the villagers. Some are compelled to leave their
occupations on account of foreign competition, but more are leaving
their hereditary occupations of their own accord. The Brahmins go to the
cities to seek government posts or professional careers. The middle
classes also leave their villages and get scattered all over the country
to earn a living. The peasants also leave their ancestral acres and form
a class of landless agricultural labourers. The villages, drained of
their best blood, stagnate and decay. The movement from the village to
the city is in fact not only working a complete revolution in the
habits and ideals of our people, but its economic consequences are far
more serious than are ordinarily supposed. It has made our middle
classes helplessly subservient to employment and service, and has also
killed the independence of our peasant proprietors. It has jeopardized
our food-supply, and is fraught with the gravest peril not only to our
handicrafts but also to our national industry--agriculture."[230]
Happily there are signs that, in Indian agriculture at least, the
transition period is working itself out and that conditions may soon be
on the mend. Both the British Government and the native princes have
vied with one another in spreading Western agricultural ideas and
methods, and since the Indian peasant has proved much more receptive
than has the Indian artisan, a more intelligent type of farmer is
developing, better able to keep step with the times. A good instance is
the growth of rural co-operative credit societies. First introduced by
the British Government in 1904, there were in 1915 more than 17,000 such
associations, with a total of 825,000 members and a working capital of
nearly $30,000,000. These agricultural societies make loans for the
purchase of stock, fodder, seed, manure, sinking of wells, purchase of
Western agricultural machinery, and, in emergencies, personal
maintenance. In the districts where they have established themselves
they have greatly diminished the plague of usury practised by the
"banyas," or village money-lenders, lowering the rate of interest from
its former crushing range of 20 to 75 per cent. to a range averaging
from 9 to 18 per cent. Of course such phenomena are as yet merely
exceptions to a very dreary rule. Nevertheless, they all point toward a
brighter morrow.[231]
But this brighter agricultural morrow is obviously far off, and in
industry it seems to be farther still. Meanwhile the changing Orient is
full of suffering and discontent. What wonder that many Orientals
ascribe their troubles, not to the process of economic transition, but
to the political control of European governments and the economic
exploitation of Western capital. The result is agitation for
emancipation from Western economic as well as Western political control.
At the end of Chapter II we examined the movement among the Mohammedan
peoples known as "Economic Pan-Islamism." A similar movement has arisen
among the Hindus of India--the so-called "Swadeshi" movement. The
Swadeshists declare that India's economic ills are almost entirely due
to the "drain" of India's wealth to England and other Western lands.
They therefore advocate a boycott of English goods until Britain grants
India self-government, whereupon they propose to erect protective
tariffs for Indian products, curb the activities of British capital,
replace high-salaried English officials by natives, and thereby keep
India's wealth at home.[232]
An analysis of these Swadeshist arguments, however, reveals them as
inadequate to account for India's ills, which are due far more to the
general economic trend of the times than to any specific defects of the
British connection. British governance and British capital do cost
money, but their undoubted efficiency in producing peace, order,
security, and development must be considered as offsets to the higher
costs which native rule and native capital would impose. As Sir Theodore
Morison well says: "The advantages which the British Navy and British
credit confer on India are a liberal offset to her expenditure on
pensions and gratuities to her English servants.... India derives a
pecuniary advantage from her connection with the British Empire. The
answer, then, which I give to the question 'What economic equivalent
does India get for foreign payments?' is this: India gets the equipment
of modern industry, and she gets an administration favourable to
economic evolution cheaper than she could provide it herself."[233] A
comparison with Japan's much more costly defence budgets, inferior
credit, and higher interest charges on both public and private loans is
enlightening on this point.
In fact, some Indians themselves admit the fallacy of Swadeshist
arguments. As one of them remarks: "The so-called economic 'drain' is
nonsense. Most of the misery of late years is due to the rising cost of
living--a world-wide phenomenon." And in proof of this he cites
conditions in other Oriental countries, especially Japan.[234] As warm a
friend of the Indian people as the British labour leader, Ramsay
Macdonald, states: "One thing is quite evident, a tariff will not
re-establish the old hand-industry of India nor help to revive village
handicrafts. Factory and machine production, native to India itself,
will throttle them as effectively as that of Lancashire and Birmingham
has done in the past."[235]
Even more trenchant are the criticisms formulated by the Hindu writer
Pramatha Nath Bose.[236] The "drain," says Mr. Bose, is ruining India.
But would the Home Rule programme, as envisaged by most Swadeshists,
cure India's economic ills? Under Home Rule these people would do the
following things: (1) Substitute Englishmen for Indians in the
Administration; (2) levy protective duties on Indian products; (3) grant
State encouragement to Indian industries; (4) disseminate technical
education. Now, how would these matters work out? The substitution of
Indian for British officials would not lessen the "drain" as much as
most Home Rulers think. The high-placed Indian officials who already
exist have acquired European standards of living, so the new official
corps would cost almost as much as the old. Also, "the influence of the
example set by the well-to-do Indian officials would permeate Indian
society more largely than at present, and the demand for Western
articles would rise in proportion. So commercial exploitation by
foreigners would not only continue almost as if they were Europeans, but
might even increase." As to a protective tariff, it would attract
European capital to India which would exploit labour and skim the
profits. India has shown relatively little capacity for indigenous
industrial development. Of course, even at low wages, many Indians might
benefit, yet such persons would form only a tithe of the millions now
starving--besides the fact that this industrialization would bring in
many new social evils. As to State encouragement of industries, this
would bring in Western capital even more than a protective tariff, with
the results already stated. As for technical education, it is a worthy
project, but, says Mr. Bose, "I am afraid the movement is too late, now.
Within the last thirty years the Westerners and the Japanese have gone
so far ahead of us industrially that it has been yearly becoming more
and more difficult to compete with them."
In fact, Mr. Bose goes on to criticize the whole system of Western
education, as applied to India. Neither higher nor lower education have
proven panaceas. "Higher education has led to the material prosperity
of a small section of our community, comprising a few thousands of
well-to-do lawyers, doctors, and State servants. But their occupations
being of a more or less unproductive or parasitic character, their
well-being does not solve the problem of the improvement of India as a
whole. On the contrary, as their taste for imported articles develops in
proportion to their prosperity, they help to swell rather than diminish
the economic drain from the country which is one of the chief causes of
our impoverishment." Neither has elementary education "on the whole
furthered the well-being of the multitude. It has not enabled the
cultivators to 'grow two blades where one grew before.' On the contrary,
it has distinctly diminished their efficiency by inculcating in the
literate proletariat, who constitute the cream of their class, a strong
distaste for their hereditary mode of living and their hereditary
callings, and an equally strong taste for shoddy superfluities and
brummagem fineries, and for occupations of a more or less parasitic
character. They have, directly or indirectly, accelerated rather than
retarded the decadence of indigenous industries, and have thus helped to
aggravate their own economic difficulties and those of the entire
community. What they want is more food--and New India vies with the
Government in giving them what is called 'education' that does not
increase their food-earning capacity, but on the contrary fosters in
them tastes and habits which make them despise indigenous products and
render them fit subjects for the exploitation of scheming capitalists,
mostly foreign. Political and economic causes could not have led to the
extinction of indigenous industry if they had not been aided by change
of taste fostered by the Western environment of which the so-called
'education' is a powerful factor."
From all this Mr. Bose concludes that none of the reforms advocated by
the Home Rulers would cure India's ills. "In fact, the chances are, she
would be more inextricably entangled in the toils of Western
civilization, without any adequate compensating advantage, and the grip
of the West would close on her to crush her more effectively."
Therefore, according to Mr. Bose, the only thing for India to do is to
turn her back on everything Western and plunge resolutely into the
traditional past. As he expresses it: "India's salvation lies, not in
the region of politics, but outside it; not in aspiring to be one of the
'great' nations of the present day, but in retiring to her humble
position--a position, to my mind, of solitary grandeur and glory; not in
going forward on the path of Western civilization, but in going back
from it so far as practicable; not in getting more and more entangled in
the silken meshes of its finely knit, widespread net, but in escaping
from it as far as possible."
Such are the drastic conclusions of Mr. Bose; conclusions shared to a
certain extent by other Indian idealists like Rabindranath Tagore. But
surely such projects, however idealistic, are the vainest fantasies.
Whole peoples cannot arbitrarily cut themselves off from the rest of the
world, like isolated individuals forswearing society and setting up as
anchorites in the jungle. The time for "hermit nations" has passed,
especially for a vast country like India, set at the cross-roads of the
East, open to the sea, and already profoundly penetrated by Western
ideas.
Nevertheless, such criticisms, appealing as they do to the strong strain
of asceticism latent in the Indian nature, have affected many Indians
who, while unable to concur in the conclusions, still try to evolve a
"middle term," retaining everything congenial in the old system and
grafting on a select set of Western innovations. Accordingly, these
persons have elaborated programmes for a "new order" built on a blend of
Hindu mysticism, caste, Western industry, and socialism.[237]
Now these schemes are highly ingenious. But they are not convincing.
Their authors should remember the old adage that you cannot eat your
cake and have it too. When we realize the abysmal antithesis between the
economic systems of the old East and the modern West, any attempt to
combine the most congenial points of both while eschewing their defects
seems an attempt to reconcile irreconcilables and about as profitable as
trying to square the circle. As Lowes Dickinson wisely observes:
"Civilization is a whole. Its art, its religion, its way of life, all
hang together with its economic and technical development. I doubt
whether a nation can pick and choose; whether, for instance, the East
can say, 'We will take from the West its battleships, its factories, its
medical science; we will not take its social confusion, its hurry and
fatigue, its ugliness, its over-emphasis on activity.'... So I expect
the East to follow us, whether it like it or no, into all these
excesses, and to go right through, not round, all that we have been
through on its way to a higher phase of civilization."[238]
This seems to be substantially true. Judged by the overwhelming body of
evidence, the East, in its contemporary process of transformation, will
follow the West--avoiding some of our more patent mistakes, perhaps,
but, in the main, proceeding along similar lines. And, as already
stated, this transformation is modifying every phase of Eastern life. We
have already examined the process at work in the religious, political,
and economic phases. To the social phase let us now turn.
FOOTNOTES:
[206] F. B. Fisher, _India's Silent Revolution_, p. 53 (New York, 1920).
[207] Rev. A. J. Brown, "Economic Changes in Asia," _The Century_,
March, 1904.
[208] _I. e._ the purveyor of the native vegetable-oils.
[209] R. Mukerjee, _The Foundations of Indian Economics_, p. 5 (London,
1916).
[210] On these points, see Fisher, _op. cit._; Sir T. Morison, _The
Economic Transition in India_ (London, 1911); Sir Valentine Chirol,
_Indian Unrest_ (London, 1910); D. H. Dodwell, "Economic Transition in
India," _Economic Journal_, December, 1910; J. P. Jones, "The Present
Situation in India," _Journal of Race Development_, July, 1910.
[211] L. Bertrand, _Le Mirage oriental_, pp. 20-21 (Paris, 1910).
[212] Sir T. Morison, _The Economic Transition in India_, p. 181.
[213] Quoted by Jones, _supra_.
[214] _The Indian Review_ (Madras), 1910.
[215] Clarence Poe, "What the Orient can Teach Us," _World's Work_,
July, 1911.
[216] C. S. Cooper, _The Modernizing of the Orient_, p. 5 (New York,
1914).
[217] Morison, _op. cit._, p. 242.
[218] H. N. Brailsford, _The War of Steel and Gold_, p. 114 (London,
1915).
[219] A. Métin, _L'Inde d'aujourd'hui: Étude sociale_, p. 336 (Paris,
1918).
[220] In his book, _Trois Ans en Perse_ (Paris, 1858).
[221] Brailsford, _op. cit._, pp. 83, 114-115.
[222] Regarding conditions in China, especially the extraordinary
discipline and working ability of the Chinaman, see my _Rising Tide of
Colour against White World-Supremacy_, pp. 28-30, 243-251.
[223] Métin, _op. cit._, p. 337.
[224] A. Yusuf Ali, _Life and Labour in India_, p. 183 (London, 1907).
[225] "India in the Years 1917-1918" (official publication--Calcutta).
[226] Young and Ferrers, _India in Conflict_, pp. 15-17 (London, 1920).
[227] Sir W. M. Ramsay, "The Turkish Peasantry of Anatolia," _Quarterly
Review_, January, 1918.
[228] _I. e._ peasants and landlords.
[229] J. Chailley _Administrative Problems of British India_, p. 339
(London, 1910--English translation).
[230] Mukerjee, _op. cit._, p. 9.
[231] On the co-operative movement in India, see Fisher, _India's Silent
Revolution_, pp. 54-58; R. B. Ewebank, "The Co-operative Movement in
India," _Quarterly Review_, April, 1916. India's economic problems, both
agricultural and industrial, have been carefully studied by a large
number of Indian economists, some of whose writings are extremely
interesting. Some of the most noteworthy books, besides those of
Mukerjee and Yusuf Ali, already quoted, are: Dadabhai Naoroji, _Poverty
and Un-British Rule in India_ (London, 1901); Romesh Dutt, _The Economic
History of India in the Victorian Age_ (London, 1906); H. H. Gosh, _The
Advancement of Industry_ (Calcutta, 1910); P. C. Ray, _The Poverty
Problem in India_ (Calcutta, 1895); M. G. Ranade, _Essays on Indian
Economics_ (Madras, 1920); Jadunath Sarkar, _Economics of British India_
(Calcutta, 1911).
[232] The best compendium of Swadeshist opinion is the volume containing
pronouncements from all the Swadeshi leaders, entitled, _The Swadeshi
Movement: A Symposium_ (Madras, 1910). See also writings of the
economists Gosh, Mukerjee, Ray, and Sarkar, above quoted, as well as the
various writings of the nationalist agitator Lajpat Rai. A good summary
interpretation is found in M. Glotz, "Le Mouvement 'Swadeshi' dans
l'Inde," _Revue du Mois_, July, 1913.
[233] Sir T. Morison, _The Economic Transition in India_, pp. 240-241.
Also see Sir Valentine Chirol, _Indian Unrest_, pp. 255-279; William
Archer, _India and the Future_, pp. 131-157.
[234] Syed Sirdar Ali Khan, _India of To-day_, p. 19 (Bombay, 1908).
[235] J. Ramsay Macdonald, _The Government of India_, p. 133 (London,
1920).
[236] In _The Hindustan Review_ (Calcutta), 1917.
[237] Good examples are found in the writings of Mukerjee and Lajpat
Rai, already quoted.
[238] G. Lowes Dickinson, _An Essay on the Civilizations of India,
China, and Japan_, pp. 84-85 (London, 1914).