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116 saved for such purposes, and let us improve our scale of living and be merry.

Now this is precisely what we have been, consciously or unconsciously, saying and doing in this country. It has been found that, excluding the farmers, labor used to get normally from 65 to 75 per cent of the produce of industry. In recent years it has been getting probably upward of 80 per cent. The share of capital and management has diminished proportionately. It is significant moreover, that savings also have diminished. In other words town labor has captured a larger portion of the produce of industry, has improved its scale of living temporarily (although there may be doubt even as to the improvement) and certainly has been making merry.

All of this may be attended with great industrial activity. No matter whether we are producing capital goods or consumers’ goods we are bound to require raw materials and to use labor in their transportation and fabrication. Obviously there will be dislocations. Thus, instead of putting steel into buildings that will last 30 years we may put it into automobiles that will be scrapped in five years. We shall divert much labor and material to the production of gasoline with which to run the automobiles, and much cement for the improvement of the roads for them. Nevertheless there will be no question respecting the activity in doing all those things and in many lines there will naturally be handsome industrial profits. Superficially everything will seem to be ringing as happily as the marriage bell. There will be upswings and downswings of the so-called business cycle, but after all those are of only superficial manifestation.