The business career in its public relations — Text and Context

Economists were demonstrating their "law of supply and demand" and their "iron law of wages" as capable in themselves of regulating all the conditions and relations of business life. Epidemics raged and depravity prevailed in the new factory centers.

But things were not, in reality, going from bad to worse. The beginnings of a better order had to be based upon two things: first and foremost, the sheer creation of capital; second, the discipline and training of workers. In the first phases, the new modern business period had to be a period of production. There had got to be developed the instrumentalities for the creation of wealth. Until the industrial system had raised up its class of efficient workers and had created its great mass of capital for productive purposes, there could be no supply of cheap goods; and without an abundant and cheap output there could be no possible diffusion of economic benefits; in other words, no marked amelioration of the prevailing poverty.

It required some development of wealth to lift our modern peoples out of a poverty too grinding and too debasing for intellectual or moral progress. It is true that the factory towns, created as they have all been by modern industrial conditions during the past century, brought their distinctive evils. There was overcrowding in ill-built tenement houses; and long hours for women and children in the factories. Yet with these and many other disadvantages, the new industrial system made for discipline and for intelligence, and above all for a new kind of solidarity and for a sense of brotherhood among workers.

In due time the worst evils began to be mitigated, largely through the application of those very methods of organization which had characterized the new kind of industry itself. Thus for men who had applied steam power to manufacturing and had begun to build railroads, it was soon perceived to be a matter not only of sanitary and social service, but of pecuniary profit, to provide water supplies, public illumination, and other conveniences to the crowded city dwellers. Moreover, with the progress of industry and the development of railroads and steam navigation, production and trade took on an ever-increasing volume.

Then the world began to be less poor. There had been no rich men in the modern sense, and of course no such thing as capitalized corporations for production. The richest man in the United States at the time of his death, a little more than a hundred years ago, was George Washington, with his land and his slaves; and so in England and France there were no rich men in the modern sense--that is to say, no men who controlled great masses of productive capital. The men of wealth were those who held landed estates. The chief business of all countries was agriculture. The capitalistic system in industry and trade existed in its rudiments and in limited measure; but all its great achievements were yet to be wrought.

All modern business life, then, is the result of this growth of productive capital, and its application and constant reapplication to the production of wealth. It made its way by virtue of an intense individual initiative and a fierce competitive struggle. But unlovely as were these things, many of their phases were necessary at a certain stage. It was this fierce competition that compelled capital to pay the lowest possible wages in order to market cheap goods. But the same situation stimulated the use, one after another, of new labor-saving inventions in order to increase the per capita productivity. This process was attended by the higher efficiency of the worker and an increase in his earning capacity. As his position began to improve, the worker gained some hope and cheer; and he and his fellows began to organize, with the result that both wages and conditions of labor were steadily improved, and the workman began to attain approximately his share of benefits.

All this is a familiar story, although the depth of its significance is beyond the compass of any living human intelligence. It is easy to say in a glib sentence that the amount of wealth produced every few years nowadays is equal to all the accumulated wealth of all the centuries down to the early part of the nineteenth; but the social meaning of so great a change baffles all attempt at full comprehension.