Page:The American Cyclopædia (1879) Volume XV.djvu/150

 142 SOCIALISM application of justice in the distribution of the wages of the labor and the profits of the capital employed in production to be the most important problem of political economy. The means proposed by him for making wages and profits proportional to each other were, that each citizen should unite in his own person the four necessary factors of production : laborer, capitalist, merchant, and employer. To bring this about, he held that employment should be guaranteed to the laborer, and that there should be a reorganization of the credit system, which he himself attempted by establishing the banque du peuple in 1849. This bank was an associa- tion of 20,000 laborers, who pledged themselves to take the paper issued by it in lieu of cash. Proudhon believed that a conventional sign of this sort, costing but little labor to produce, could take the place of gold and silver coins, the production of which requires a large amount of labor. The bank advanced to any member, on articles produced by him, four fifths of their value in its own notes, and demanded no in- terest for the loan. On security being given, it would advance upon work not yet done. Proudhon expected that this gratuitous credit, enabling men to consume at any time the wages of their labor, would be the means of inciting the members of the association to as great industry as the hope of accumulating interest-bearing capital, since their means of present enjoyment would depend upon their energy. The government soon closed the bank for violation of the laws of trade, and Proud- hon's followers maintain that his scheme has never had a fair trial. Robert Owen (1771- 1858), in England, was arousing the public mind to the necessity of a new order of socie- ty at the same time that Saint-Simon and his disciples were preaching in France. They pro- ceeded, however, on wholly different grounds. Owen's fundamental axiom was that man was made entirely by his external circumstances, so that, to form his character, and to produce his entire happiness, nothing was requisite but a change in his external relations. Possessed of great wealth, he established a manufacturing colony at New Lanark, in which his principles were applied to the laboring classes. Justice in the payment of labor, vast domestic economies, and a thorough system of infant and adult edu- cation gave it for a time great and increasing prosperity. Statesmen and churchmen alike admitted the success of the attempt, and the system, or parts of the system, were in a fair way of being introduced into other manufac- turing districts. But Owen was encouraged by the promise of his plans to step forth as a phi- losopher. He taught in pamphlets, speeches, letters, and books, his doctrine of the omnipo- tence of circumstances and of human irrespon- sibility, attacking at the same time all religions and all governments, and thus provoking the earnest hostility of the clergy as well as of politicians. Other establishments were sub- sequently erected at New Harmony, Indiana and Orbiston, Scotland, but they failed. His popularity declined rapidly, except among a portion of the laboring classes, and he ac- complished nothing beypnd his earlier suc- cess. He had travelled over the world to in- doctrinate it with his principles, but the world remained to the end of his life stubbornly in- credulous. Nevertheless he has a just claim to be considered the originator of modern co- operation. In 1869 England alone numbered 1,308 cooperative societies, under general reg- ulations prescribed by act of parliament ; 749 of these sent in their returns to government at the end of 1870, from which their condition appears to have been as follows: number of members, 249,113; share capital, 2,034,261 ; loan capital, 197,128; average stock in trade during the year, 912,127; value of build- ings, fixtures, and land, 962,276; dividend to members, 467,164; to non-members, 16,- 523 ; allowed for educational purposes, 3,775. The most successful experiment of the English cooperators is that of the Rochdale " Equita- ble Pioneers' Society," established mainly on the principles of Owen. Its primary object was the founding of a store for the sale of the necessaries of life, which was opened in De- cember, 1844. In 1847 the pioneers opened a drapery department, in 1850 a slaughter house, in 1852 shoemaking and tailoring establish- ments ; and after a history of continuous suc- cess, in the last quarter of the year 1870 they numbered 5,560 members, and had a share capital of 81,232. Similar stores and asso- ciations now exist in various parts of Europe, America, and Australia. The varieties of co- operation so far developed are numerous, but they are all founded upon the original idea of associated as opposed to isolated efforts. The power which the joint-stock principle places in the hands of small capitalists, the coopera- tive system places in the hands of the smallest capitalists; it even enables the man without capital to accumulate it. Morier describes co- operation as "the child of socialism, rescued by the economists from the dangerous custody of its parents." In Germany this movement on the part of the laborers was urged forward by Schulze-Delitzsch in opposition to the so- cialism of Lassale and Marx, which led to the formation of the " International Association." (See INTERNATIONAL ASSOCIATION.) Schulze- Delitzsch originated a new form of coopera- tion, which has been successful in Germany to an extraordinary degree. He devised a peo- ple's bank, or cooperative credit bank, from which the members can borrow small sums up to 1,000 .thalers. The capital is derived from the entrance fees and subscriptions of the members. The shares are fixed at 40 thalers, and may be paid by instalments. A 40-thaler shareholder may borrow 60 thalers without security ; money is borrowed by the society at a low rate of interest ; members on leaving re- ceive the amount paid up on their shares, and are relieved from all liabilities after two years.