Two questions are raised by Marx's work: First, Are his laws of historical development true? Second, Is Socialism desirable? The second of these questions is quite independent of the first. Marx professes to prove that Socialism must come, but scarcely concerns himself to argue that when it comes it will be a good thing. It may be, however, that if it comes, it will be a good thing, even though all Marx's arguments to prove that it must come should be at fault. In actual fact, time has shown many flaws in Marx's theories. The development of the world has been sufficiently like his prophecy to prove him a man of very unusual penetration, but has not been sufficiently like to make either political or economic history exactly such as he predicted that it would be. Nationalism, so far from diminishing, has increased, and has failed to be conquered by the cosmopolitan tendencies which Marx rightly discerned in finance. Although big businesses have grown bigger and have over a great area reached the stage of monopoly, yet the number of shareholders in such enterprises is so large that the actual number of individuals interested in the capitalist system has continually increased. Moreover, though large firms have grown larger, there has been a simultaneous increase in firms of medium size. Meanwhile the wage-earners, who were, according to Marx, to have remained at the bare level of subsistence at which they were in the England of the first half of the nineteenth century, have instead profited by the general increase of wealth, though in a lesser degree than the capitalists. The supposed iron law of wages has been proved untrue, so far as labor in civilized countries is concerned. If we wish now to find examples of capitalist cruelty analogous to those with which Marx's book is filled, we shall have to go for most of our material to the Tropics, or at any rate to regions where there are men of inferior races to exploit. Again: the skilled worker of the present day is an aristocrat in the world of labor. It is a question with him whether he shall ally himself with the unskilled worker against the capitalist, or with the capitalist against the unskilled worker. Very often he is himself a capitalist in a small way, and if he is not so individually, his trade union or his friendly society is pretty sure to be so. Hence the sharpness of the class war has not been maintained. There are gradations, intermediate ranks between rich and poor, instead of the clear-cut logical antithesis between the workers who have nothing and the capitalists who have all. Even in Germany, which became the home of orthodox Marxianism and developed a powerful Social-Democratic party, nominally accepting the doctrine of ``Das Kapital'' as all but verbally inspired, even there the enormous increase of wealth in all classes in the years preceding the war led Socialists to revise their beliefs and to adopt an evolutionary rather than a revolutionary attitude.