of collecting the savings or surplus wealth of thrifty persons for investment in industry, there is no difference in principle whatsoever. Capitalism implies competition, and competition, Labour says, must be eradicated out of social and industrial activity. Why competition should be a good thing in every walk of human life and provide a healthy stimulus, and yet not provide an equally beneficial stimulus in industrial and commercial affairs is hard to follow. What Labour really intends to say is that competition acts so as to depress wages and lower the standard of living of the worker. That is only one side; competition acts so as to increase demand for commodities and the volume of employment, and, if production were not restricted, would increase wages. Then it is said that the capitalistic organization of industry involves economic waste, by which is meant that industry is carried on less efficiently under private management than it would be either under Government or under “democratic control.” If there is waste it is the capitalist who suffers, the Trade Unionist always receives his standard rate of wages. If there is waste on the employers’ side, as of course there is in some badly organized shops, there is greater waste in the shape of restricted production on the part of the worker. Organization and efficiency are, of course, essential to industrial progress, but to suggest that these essential qualities are better obtained under bureaucratic or democratic control is at variance with our experience during the war and of present conditions in Russia where democratic control has laid the hand of death on industry. Where Reform is Admittedly Needed It must not be assumed that the capitalistic system of organization of industry is perfect and needs no reform; unfortunately, it exhibits a number of well-marked deficiencies. First of all, an employer only employs a man as long as he desires or finds he can profitably do so, in just the same way that the workman only works for an employer as long as he finds it suits him and no better job is forthcoming. One defect certainly of the present capitalistic system is the failure of employers in industry as a whole or of each industry in particular to provide against unemployment. On this matter I have a good deal to say in a subsequent part of this book. Again, in the past there was a regrettable tendency which, in recent years, has happily disappeared amongst the best employers, to disregard the human qualities, aspirations, needs and susceptibilities of the worker, coupled with a neglect to provide effectively for his welfare and well-being in the works. This, however, is nothing intrinsic in the capitalistic organization of industry; I have heard equally bitter complaints by the workers when I have been sitting as arbitrator in disputes between employees of the “non-capitalistic” co-operative societies and the societies’ democratic managements.