Business the Civilizer
BY EARNEST ELMO CALKINS
WHEN I entered college forty years ago the chief purpose in acquiring an education was to fit one’s self to enter a profession. The three more obvious ones were law, medicine, and divinity, sometimes called the Three Black Graces, no doubt because of the long Prince Albert coat which was the professional and professorial costume. I never saw a professor in a business suit in all my college course. Our president went even further in this setting off of the professional from the business life by wearing a coat that buttoned up to his chin, which picturesque and distinguished dress made him look like the steel portraits in the front of old books of memoirs. Thus the superior vocations were separated from the sordid ones by dress as well as in other ways.
A boy without enough brains or enough money to get through college was destined for business. If he tried college and failed to absorb the small amount of Greek, Latin, and mathematics which constituted a college education in those days, he dropped out and went into papa’s store, or the factory, and became a business man. Or he went back to the farm. A college education was considered superfluous m either case. Young men did not elect careers. They began by sweeping out and running errands and let nature take its course. The college was looked upon as a device for training professional men, chiefly ministers. The one I attended was founded, so its charter stated, to prepare young men for the ministry; but in my time divinity had begun to feel the competition of law. Out of a class of fifty-two, and half of them women, we produced twelve lawyers. Law was the recognized steppingstone to politics. Out of those annual crops of young lawyers we were manufacturing our state legislators and congressmen, and as a result have been governed by lawyers ever since. The congressional district in which I was born is still represented by one of my classmates.
The lure of the professions as occupations may be loosely ascribed to the popular belief that they were more respectable, as well as more interesting, than business. Making and selling goods was deemed a humdrum life, not to be endured by free spirits and aspiring minds. Clerks were counterjumpers. Traveling salesmen were drummers. Both expressions carried a stigma. The jobber and wholesaler ranked a step higher than the retailer, but they all had the shopkeeping mind. Most of them held the popular view of their social and intellectual status. The plodding storekeeper, ambitious for his son, hoped to make a doctor or a lawyer of him. In business you made money, but it had few other compensations. A great gulf yawned between business and the professions.
The condescending attitude of the educated classes toward trade is noticed by the Beards in their candid and admirable history of American civilization. The system of our early colleges was taken over from that of the English universities, which was in its turn an inheritance from the Greek academe where were taught the ‘liberal arts,’ contrasted with the ‘vulgar arts’ of trade and industry. Thomas Jefferson sincerely believed that ‘ the operation of buying in the cheapest and selling in the dearest market inevitably led to chicanery and accumulation of great wealth by speculation, intrigue, and exploitation.’ Thus business as we know it was first forced to work itself out from under a social cloud. In the eyes of the cultivated and refined it was vulgar, or, as Emerson characterized it, ‘selfish, huckstering trade.’
But there was something more than mere snobbishness in this superior attitude toward business, and it was found in the low standard of morality that characterized it, and was believed to be essential to its conduct. Business was no place for a man with scruples or ideals. Apparently its cardinal virtue was to get the better of someone. Buying and selling retained the character of bartering, with all that the word implied of haggling, misrepresentation, deceit, trickery, short weight. Caveat emptor was the unofficial slogan. The only discreditable failure was the failure to make the sale. Anything that accomplished the desired end was not only allowable but commendable. Sharp practice was taken for granted and even applauded. A brief glance at the history of American business shows that these conditions not only existed, but were in a way inevitable.
The foundations of our interstate commerce, now the concern of so much legislation, were laid by the peddlers, those insinuating scamps who followed the road with packs on their backs from colonial times down to the Civil War. The tin peddler, who traded bright new kitchen utensils for old rags, survived into my own boyhood. These peddlers make a picturesque chapter in our industrial history, which has been graphically described by Richardson Wright in his Hawkers and Walkers. Their sharp and unscrupulous methods influenced buying and selling long after the peddler had disappeared and business had begun to settle down into the channels of trade where we find it now. The articles which filled their packs came to be known as Yankee notions, and the peculiar tactics by which they overcame sales resistance were described as Yankee tricks. English visitors of that time often allude to them, and their reports gave us an unenviable reputation abroad, which we have not yet lived down. Probably no spice peddler ever carried wooden nutmegs in his pack, but the term became a symbol, so apposite was it of the peddlers’ methods. One hears of shoe-peg oats, oak-leaf cigars, and basswood hams. Of all this tribe Sam Slick was the prophet.
Sam Slick was an imaginary character, a peddler whose adventures were part of the humorous literature of that time. He expounded the use of ‘soft sawder’ in disposing of six-dollar clocks for forty dollars. One incident told by Mr. Wright gives the character of these Yankee tricks. The peddler started with a dozen clocks. At each sale he guaranteed the clock would run or he would replace it on his return trip. When he had sold eleven clocks he retraced his steps, using his remaining clock to replace the one sold at the last place, — which, of course, had not run long, — and the clock taken back there to replace the next one, and so on, until each purchaser had been visited and temporarily satisfied with a new clock. Of course he did not canvass the same territory twice.
A large crop of anecdotes was the fruit of these mean and unlovely methods, which afford an amusing but thought-provoking commentary on the business ethics of the times. The famous anecdote of Lincoln is an instance. Lincoln once agreed with a neighbor to swap horses sight unseen. A horse trade was always a challenge to outwit one another. The neighbor arrived leading a disreputable, fleabitten, pot-bellied, sway-backed old crow-bait, and the assembled spectators awarded the palm to him, until Honest Abe arrived carrying a sawhorse. Such stories were told with unction. In a book of Wit and Humor, published before I was born, were many such. One I recall ran something like this: A hardfisted old deacon who lives over his general store calls down the stairway to the overworked assistant who has been on the job since daybreak: —
‘Have you sanded the sugar?’
‘Have you watered the rum?’
‘Have you dampened the tobacco?’
‘Then come up to prayers.’
In the same old book was another example of parsimonious meanness. Because of the scarcity of ready money, farmers brought their produce to the village store and exchanged it for what they needed, and after the deal was completed the storekeeper would draw a glass of something from one of the barrels in the back of the store as a libation to the gods of commerce. A farmer came in with an egg which he swapped for a darning needle. The trade completed, he hesitated a moment, and at length inquired: —
‘Ain’t you goin’ to treat?’
‘On that trade?’
‘A trade’s a trade, even if it is small.’
‘Well, what’ll you hev?’
‘Sherry an’ egg.’
The merchant, willing to humor so mean a customer, drew the sherry and broke into it the very egg he had just received. It proved to be a double one.
‘Hey,’ exclaimed the farmer, ‘that egg’s got two yolks. Ain’t you goin’ to give me another darning needle?’
Such humor carries an element of exaggeration, but there must have been something behind it to give it point, as with the prohibition jokes of our day.
The storekeepers and drummers who took over and carried on the work of the peddlers inherited the t2radition that in trade, as in love and war, any trick was fair. Goods in shops were never marked with plain figures. Price tickets were unknown. The price was whatever the seller could get, all depending on the shrewdness and knowledge of the buyer. The drummer worked off damaged goods on the dealer, and the dealer worked them off on the consumer, and everybody entered into the spirit of the game, and the outcome furnished conversation and anecdotes. Of course there were honest merchants, but even the most punctilious contented himself with rendering one hundred cents to the dollar. He refrained from cheating his customer, but if the customer insisted on cheating himself, that was his own lookout. Nothing so quixotic as protecting the customer from his own folly and shortsightedness had yet been dreamed.
Big business, which was just beginning to organize itself, was as mean and tricky as petty business. It was believed that no business could become large honestly, and the newly formed corporations seemed determined to justify that belief. They gave little attention to the ultimate consumer. Their concern was with each other. The object in forming a combination was to crush competition. Miss Tarbell, in her history of Standard Oil, lias told how it was done. At the best it merely stayed inside the technical limits of the law. At its worst it was ruthless and nefarious commercial piracy.
The whole business of buying and selling was honeycombed with graft. It ranged from entertainment of buyers — even this mild corruption is frowned on by the best concerns to-day — to out-and-out bribery and even worse. I remember my own dismay at my first offer of a rake-off. Thirty-five years ago my then employer had need of a small printing press, what was known as a ‘jobber,’ and I, having some knowledge of printing, was commissioned to buy it. I saw representatives of the two large firms in the field. One of them explained that the price of his press was three hundred and fifty, but that he would bill it at four hundred. I would O. Iv. the bill, and his firm would send me a check for fifty dollars. It was done every day, he added, seeing my perturbation. I cannot draw an impressive picture of myself sternly refusing temptation. In fact, I was scared, and ran as fast as I could to the other man and bought his press without more ado. I learned soon enough that the salesman was right, and the practice only too common, and that many business men had contempt for one who refused to profit, by the system.
A young purchasing agent came to his chief with a check for five thousand dollars, drawn to his order by a large company from which he bought supplies.
‘ What am I to do with this?5 he asked.
His chief regarded him steadily for a moment, and then said, ‘Write your name on the back of it,’ after which the chief pocketed it and sent the purchasing agent back to his desk.
The liveliest and most picturesque chronicle of this buccaneering period of American industry is the story of the National Cash Register Company. Its methods were no more ruthless than those of its contemporaries, but they were given the glamour of romance by the genius and originality of John Patterson, its founder and president. He determined to make the Dayton concern not only the biggest, but the only cash-register business, and for a long time he successfully checked the advent of rivals in the field. He strangled them at birth if possible. He bought every invention he could buy. He filed patents for every improvement he could think of, holding them in check for infringement suits when the time came. He bought each new machine that appeared and had it analyzed for ways of beating it, and these ways he made public to the employees of saloons using it., and then informed the proprietors of the dangerous knowledge possessed by their barkeepers. Merchants were persuaded to throw out competing machines, which the National people took back on liberal terms if their registers were installed. The machines thus secured were dumped in what was known as the ‘Graveyard,5 where they rusted pathetically,and were shown to visitors, and became a legend, and no doubt discouraged many would-be inventors. Salesmen with mechanical training were sent out on the road to show merchants the defects of rival devices, and even to tamper with them if necessary. Patterson finally fell afoul of the Sherman Act, and would have gone to jail, but at the psychological moment occurred the great Dayton flood. He organized the relief work in so prompt and efficient a manner and rendered so valuable a public service that the indictment against him was quashed.
In all these practices Patterson was but the product of his times. On the other hand he contributed to business many of its most cherished practices,— the sales manual, the hundred-point club, the scientific approach, the quota system, — devices of high-powered salesmanship which are in constant use to-day. I for one do not judge him harshly. I have no great admiration for the Sherman Act. Its attitude toward a man who creates new industry is unfair. The competitors who sought to profit by the new business field that Patterson had originated and developed were, after all, parasites. The Government has just served notice on Gillette, the safety-razor man, that the industry he created must be shared with others. Nothing is allowed for the fact that such a business would not exist if it had not been for Gillette, and that all other safety-razor companies owe their business to a market, a state of mind, that he made possible. It is an easy matter, once a new basic idea is discovered, for competitors to make slight changes in the original idea and secure a patent. The patent office does not recognize basic patents. I see no reason why a man should not enjoy a monopoly of a market which would not have existed but for him, and which is concerned only with an acquired habit satisfied with a device which mankind has hitherto done very well without.
These are merely some of the more striking and obvious happenings that stick out in memory and go to show that if the young man of the last. quartcr of the last century hesitated to go into business because of a belief that success meant the adoption of standards and practices repugnant to honesty and decency he was not entirely wrong in that belief. Business was, on the whole, on a lower moral plane than the professions, and business men honestly believed that anything they could get away with was not only allowable, but good business. But the heritage of trickery and guile acted as a deterrent to high-minded men, whose training and education had given them ideals incompatible with the pursuit of trade. Business and the higher walks of life pursued independent courses and continued to reproduce, each after its own kind.
Even the most jaundiced observer must admit that business is ethically better than it used to be. The millennium has not arrived. Human nature has not changed. Men are just as selfish and self-seeking as they ever were. But business has learned the priceless truth, laid down by Benjamin Franklin, and scores of philosophers before him, that honesty is really the best policy. It has learned that the only source of prosperity is the public, which buys and pays, that on its treatment of that public depends, in the long run, its success, and that a permanent customer who comes back is a greater asset than the profit on the first sale.
The old idea of a bargain was that one of the parties must lose. The modern idea is that both parties must be satisfied, and that the exchange of goods or service for money can be carried on successfully and profitably with clear consciences on both sides. The golden rule is not only good ethics, but a workable business axiom.
The beginning of this new dispensation might be set at the time when the public sharply served notice on big business that enterprises so necessary to its welfare and which depended so greatly on its good will could no longer be administered as the private concerns of their conductors. One of these outbursts was the Hughes Commission, which disciplined the insurance companies and set them on the right path. Another was the antitrust crusades which came to a head in the Roosevelt administration. The insurance companies and the Standard Oil and tobacco companies should bless these prosecutions. Through them they found the road to greater profits. The legal results from these flare-ups may not have been always conclusive, but as an expression of public opinion they were tremendous. They pointed the way for business to become rich beyond the dreams of avarice. This same public which demanded that business should be conducted with some consideration for its comfort and wellbeing rewarded business with the greatest response in industrial history when its demands were granted. There is no moral principle involved. The change from ‘ the public be damned’ to ‘the public be served’ was shrewd business st rategy, more profitable than any ruthless, rule-or-ruin policy of the past. With few exceptions no monopoly is possible to-day, even if the paternal influence of the Sherman Act were withdrawn. Monopolies develop their own competition. The only important factor is the public good will, and that is open to all. The way to win it is to deserve it.
As business men began to realize these things and to trim their sails to the new winds of destiny, the character of business changed. In no respect was this so striking as in its personnel. That educated young man, whom we have seen with standards so high that he could not take up a business career and retain his self-respect, has been both cause and effect in the change. As business improved its ethics under the influence of public opinion and its own enlightened outlook, his repugnance to soiling his hands with trade began to disappear, and he entered it in increasing numbers, and furthered the change already under way. Business began to offer two appeals to such a mind. It became more adventurous, more glamorous, as the rapidly developing resources of the country opened up new realms of exploration and adventure. It lost that cut-and-dried character symbolized by the bookkeeper bending over his tall desk. Moreover, business was turning to specialists to help it out, trained minds, chemists, engineers, economists, the products of colleges and professional schools. The two worlds were being brought together. The gap was being bridged. A new type of business man appeared who changed the social as well as the intellectual character of the class. Nowadays the big corporations send scouts to the principal colleges at commencement time to spy out the land and appraise the human material coming through, offering openings in their industries to promising young men who are well spoken of by the college authorities. As Mr. Owen D. Young said at the dedication of the new plant of the Harvard Business School, ‘not only will scholars go into our factories and exchanges, but men trained in business will go back into the halls of learning. ’
In this realignment of business standards, advertising has played an important rôle. It is interesting to note that advertising itself began its career in infamy. It was once the mainstay of nearly every disreputable and crooked enterprise. It had shamefully abused public confidence. So bad a name had it that legitimate businesses hesitated to employ it. Advertising had to clean house, correct its own abuses, and show itself worthy of confidence before it could offer to guide the new business that was emerging from the welter of the old. And here again, let it be said, no moral principle was involved, no uplift intended. Advertising realized that if it would continue to exist it must win and hold public confidence, and must hinder as far as possible the exploitation of a credulous public. In this it has succeeded to a commendable degree, for while the public is still credulous, and is still exploited, and by advertising at that, there exists a large body of believable advertising, and much to which even the most meticulous can take no exception. The grosser forms of swindling and deceit have been reduced and circumscribed. The bulk of national advertising — that is, advertising of manufacturers as compared with retailers — is placed by agents who are members of an association which has its code of ethics, equal in enlightened selfishness to that of any other professional body, and lived up to at least as fully as the codes of the other professions. There is yet much to be done, but advertising men realize that the confidence of the public is their greatest asset, and a goodly number of them would refuse to betray that confidence, even at the request of a client.
One of the opportunities which appealed to the new generation of business men was advertising. To mobilize public opinion in its favor added a new zest to business, gave it expression, and widened its horizon. But the amazing thing about advertising in connection with business was its reflex action. Advertising improved the business that employed it. Its immediate effect was to set up standards of quality or service which the business must comply with, or belie its advertising. Advertising brings a business out in the open where it can be observed of all. In the limelight of publicity questionable practices must fade away. Advertising is competition. Each advertiser must tell his best story, to be compared with the best story of his competitors, so he must have a story to tell. George Eastman bought the autographic register for cameras from the inventor not only to add it to the Kodak, but to add it to his advertising, to improve his story. The advertising made the camera better. Ivy Lee has said many times that the main office of the public-relations counsel is not so much to tell the client’s story as to advise a course of conduct which will result in having a favorable story to tell. That is even more true of paid publicity. A manufacturer cannot go on year after year telling lies about his product without being found out. Excessive claims tend to right themselves, or be righted, by the sturdy competition of truth.
Study the soap and dentifrice advertising in the magazines and newspapers of recent years. The claims made about both have been the rallying ground of that group that finds all advertising undesirable. Toilet soaps that wash away all facial blemishes and leave the washer fair as Rosamond; dentifrices that remove film from the teeth, and prevent or even cure pyorrhœa. But there was at least one manufacturer ready to do battle with each. When the advertised claims of the complexion soaps began to exceed the bounds of all reasonableness, Kenneth Fraser took the train to Ivorydale and interviewed Colonel Procter. ‘ What is Ivory Soap going to do in face of advertising like that?’ he asked. Colonel Procter said, I’ll be the goat. What is it going to do?’ Fraser told him and came back from Cincinnati with a new advertising account. And straightway the Ivory Soap advertising began to tell just what a toilet soap could do and all it could do, and set up limits and gave the public facts by which it could judge all toilet soaps. The result was a restraining effect on the Palmolive advertising. The same thing is happening in dentifrices. Dr. Lyons’ Tooth Powder and Colgate’s Dental Cream are both using their advertising space to offset undue claims, instead of stretching them further. That is one of the values of advertising. It will correct itself. The lying advertisements will find themselves surrounded by truth and will be forced back in line by the weight of public opinion.
A noteworthy influence in lifting the conduct of business to a little higher plane was the growth of coöperative movements. Associations were formed by men in the same line of trade and manufacture, and thus competitors had an opportunity of getting acquainted with one another, with gratifying results. Each learned to his surprise that the hated competitor was just another man like himself, with the same hopes and fears, and that they had more in common than they had points of disagreement.
’I hate that man!’ cried Charles Lamb in vigorous condemnation.
‘Hate him?’ said his friend. ‘Why, you don’t even know him!’
‘Of course I don’t. How could I hate him if I knew him?’
By getting together and working together for the common good of their industry, men found each other out, and the traditional enmity of competition withered up. A man was still a competitor, but no longer an enemy. The old competition meant disposing of competitors, by fair means or foul, and then letting the consuming public pay the bill to the survivor. The new competition recognizes that all who make and sell are competitors, that diningroom furniture competes with trips to Europe, flivvers with radio, or perfumes with groceries, and that it is far wiser to combine to enlarge the existing market for a product — for oranges, or paints, or cement — than to fight each other for the smaller market that exists. Coöperation means sharing with competitors ideas that will benefit all. There are few business secrets to-day. Prices or processes, patents or pat terns, formulas or sales methods — all the cards are laid on the table by advertising or round-table discussions. Thus business has in a way adopted one of the cardinal principles of the professions in considering the common good before the interests of its individual members. This collectivism says to its customer, which is all of us, that not this or that product, or even this or that industry, but the whole of business, the making and selling of goods, the supplying of all service, is attempting to render itself acceptable and satisfactory to all.
Not only is there a change in the business man’s attitude toward his competitors, but there is a new point of view when he regards himself, his own business, his employees, and his customers. It is recognized that it is possible to make money and pay high wages at the same time; and, more, that the high wages create new customers for more goods, which helps to keep up production. If a manufacturer insists on too large a margin of profit at the expense of his employees, this automatically reduces the number of purchasers of goods, his own or other’s, which in the end works around to his business. The employees are part of the public, the consuming public, on which all business depends. It should be one purpose of the advertising that the employees of a business shall feel the same good will toward the business that the rest of the public does.
When Howard Heinz, president of the H. J. Heinz Company, returned from Europe, where he had been helping Herbert Hoover distribute relief to nations suffering from the after effects of the war, he brought back a conception of his business which was not new to him, but which had undoubtedly been crystallized by the contact with humanity from an uncommercial standpoint. He said to me: ‘I learned from my father to look upon our business not merely as a source of profit or revenue. I was taught that a certain responsibility goes with it, and with any large business affecting many people. I feel that, with due consideration to the owners who make the business possible, I am responsible to three groups of people affected by the Heinz business, and that it should be administered so that it is profitable, or satisfactory, or helpful, to them — the three groups being the people who work for it, the grocers who distribute its products, and the customers who consume them.'
Some such idea is in the minds of most enlightened manufacturers today. Some may regard it complacently, others realize that it is nothing but common sense, many do not express it; but it; all grows out of the participation of the public in whatever prosperity any business enjoys.
There is hardly a man at the head of our great corporations who needs to work in the economic sense. It came out in the news the other day that Gerard Swope, president of the General Electric Company, had been offered $250,000 a year to take charge of the Goodyear Rubber Company and had refused. It is likely that a quarter-ofa-million salary was more than he was getting. That is a large salary even in these days. But what of it? Men like Swope work for something besides money. He had found his work where he was, and pursued it with something of the disinterestedness with which a scientist follows a line of research. The interest of creating an entity out of a great corporation, — something more than a mere money-making machine, — guiding it in making industrial history with chemists and engineers as pilots, invoking advertising to make the public a sharer in its triumph, actually adding to the sum total of human comfort and even of human happiness, as happiness goes in these days, offers more real thrills than any of the oldfashioned professions can offer.
Colonel Du Pont, with wealth and corporations to satisfy any mere moneygrubber, buys an old but run-down paint factory, and, in a time so short it sounds like an Arabian Nights story, is doing one third of the paint business of the country. Cyrus Curtis developed three enormous magazines, each a leader in its field, and then moved out and into the offices of the moribund Public Ledger and began his business life all over again. And when the Ledger showed signs of making good he moved over into New York and started to do the same thing with the New York Evening Post. It would be absurd to suggest that Curtis needs more money. This all means that business as it is now conducted is the supreme field of endeavor, calling for every quality of mind that success in the most idealized profession demands, — brains, energy, and imagination, — and that, as such, it draws men to it for the sheer love of doing it. Business may not be the noblest pursuit, but it is true that men are bringing to it some of the qualities which actuate the explorer, scientist, artist: the zest, the open-mindedness, even the disinterestedness, with which the scientific investigator explores some field of pure research. It is no mere figure of speech to call business a profession. It is getting into the hands of professionally trained men. Its ethical standards are higher, its knowledge broader, and its problems appeal to the professional mind. Its routine, once the sole concern of business men, is now no more to it than the routine of a hospital to a surgeon, or the routine of a law court to a lawyer. And its profits, after a comfortable living is assured, are merely the counters that register the success of the effort.
Business is the new profession, as so many of the newspapers justly observed in their editorial comment on the exercises at the Harvard Business School. It is attracting the men who once gravitated to the old professions, because it now offers not only the interest appeal of the older professions, but also the higher ethical standards. To quote Mr. Young again: —
To-day and here business formally assumes the obligations of a profession, which means responsible action as a group, devotion to its own ideals, the creation of its own codes, the capacity for its own discipline, the awards of its own honors, and the responsibility for its own service.
Mr. Young, as the World remarks, is no rhapsodist, but he is after all a business man, and might be inclined to look with a favoring eye on his own field of endeavor, especially on such an auspicious occasion; the more that the General Electric Company, which is one of his numerous interests, is a shining example of what a modern enlightened corporation can be. But we have another and certainly impartial observer in André Siegfried, whose book, America Comes of Age, has excited wide and approving comment. In discussing our industrial system, he makes the following significant statement: —
On the other hand, general culture based not only on experience but on education is becoming more indispensable at the top of the ladder. As a business grows, the problems that must be confronted become broader and require minds that are more alert, keen, and highly trained. The time is past when a youth is initiated into business by sweeping out the office. For the directors, the general secretaries, and the assistants that surround them, America sincerely believes in economic education. This does not mean simply a business-college course in bookkeeping, commercial correspondence, economic geography, etc., but an education that will turn out young men of broad culture. This may seem singular when applied to the Americans, whom we usually consider deliberately practical; yet the demand for such culture is to-day nowhere more insistent than in the executive circles of New York, Boston, or Chicago.
More than that, the New Republic, which may without disparagement be assigned to the extreme left wing of the opponents of business, in discussing Siegfried’s book, admits: —
The conduct of big business tends to be increasingly a matter of expert administration, and, as such, it is leavened by professional standards and by the results of scientific research.
A bird’s-eye view of new activities of business undreamed of in the old bad days, all directed toward improving relations with competitors, employees, or customers, is given by Haley Fiske, president of the Metropolitan Life Insurance Company, in an address before the United States Chamber of Commerce. From the reports of some sixty coöperative associations he learns that systematic effort is being made to arbit rate disputes between member and member, and even between member and non-member. Especially heartening is the aid extended to weaker members to help them keep up and stay in business in face of new competitions, by making available to them information they could not otherwise afford, including legal opinions of value to all members on trade difficulties; putting a stop to unfair competition, especially graft; raising standards of products to meet competition from inferior substitutes; sending inspectors to factories to suggest improvements; and establishing ethical codes governing competition.
The problem of waste is being met and to some extent solved by eliminating duplication, in coöperation with the suggest ions of the Department of Commerce, which has scaled the number of styles of hotel china from 700 down to 160, milk bottles from 49 to 9, blankets from 78 to 12, paving brick from 66 to 4, asphalt from 88 to 9, and files and rasps from 1351 to 496.
Research maintained by associations is benefiting not only member manufacturers, but retailers who distribute their products and customers who consume them. A study of retailing has been made to determine the best location for a store, arrangement of the stock, and the proper ratio between assets, liabilities, income, and expenditures. Vocational training in storekeeping is afforded, and assistance offered, to enable independents to meet the competition of the chains. Research is also directed to improving the quality of the goods and to lowering prices to the consumer. Employees are impressed with their responsibility to the public in the products they make, and steps are taken against misbranding. Some associations guarantee products bearing a standardized label. Trade abuses, such as short weight, short measure, misbranding, and misrepresentation, are being corrected, with the weight of a whole industry behind the movement.
A few of the contributions that organized business is making to the welfare of the workers are suggested by the following brief catalogue: —
Coöperation in shop management, even in some cases including wage adjustments; suggestion systems with prize awards, not on wages, but in the promotion of efficiency, in improvement of apparatus and conditions under which it is used, and in saving of time, money, labor, or material; single company unions; accident prevention; hygienic attention to workrooms; medical and surgical attention, dental work, nursing, cafeteria service, milk supply; profit sharing; stock purchasing by employees helped by contributions from employers; mutual benefit associations with corporate assistance; pensions; efforts in seasonal employments to cut down lay-offs, and even giving allowances in cases of unemployment; intensive health work.
Group insurance has enabled employers to extend wonderful opportunities to their workmen. Says Mr. Fiske: —
The contract may provide for life insurance, accident insurance, insurance against sickness, pensions, insured savings, insured thrift, and some day, we hope, unemployment. Incident to it in some companies are free nursing, the distribution of health and safety literature, surveys of places of employment, free advice on sanitation, healthful conditions as to light, air, pure water, safety, humidity, heat, elimination of dust, occupational-disease control, accident prevention, even on machinery, manufactory methods, cost fixing, distribution and allocation of factory divisions, on personnel, the creation of good morale, recreation, housing, draining, diet, restrooms, rest periods, assistance to building loan associations, mutual benefit societies, social organizations. A long catalogue, is it not?
And yet every one of these items is on the actual programme of one or more of employers. The number of insured is rapidly increasing and is now over five millions and has more than tripled in the last six years. These activities of employers are coöperative in the same way as your trade associations are coöperative.
And it may be added here that, despite all agitation about the wages of labor, the average pay has advanced more than the average cost of living.
These are a few of the meliorations that might be set up against Stuart Chase’s pessimistic picture of the selfishness and wastefulness of business. While many of his strictures are just and true, they are conditions that are on their way out. The important thing is that they are recognized by the men who have the most at stake and the power to change them, and their elimination or betterment is the avowed object of the majority in many industries. The purpose is to remove abuses and cure evils without abolishing industry itself, which latter seems to be the drastic method preferred by Stuart Chase and his little group of serious thinkers. Such books as Your Money’s Worth (Chase and Schlink) and The Distribution Age (Borsodi) are thought-provoking but one-sided. They ignore the alleviations, the signs that business realized these conditions before the writers did and took steps to make itself more worthy of public confidence. Against every instance of the public being fooled by advertising, high-pressure selling, misrepresentation, or extortion, can be placed a bigger, further-reaching instance of a successful effort to make the manufacture and selling of goods as near a public service to the ultimate consumer as is humanly possible. Business is exhibiting that quality of a profession which Mr. Young described as the capacity for its own discipline.
‘The history of business likewise remains obscure,’ say the Beards, ‘because those who followed in the footsteps of Gibbon and Carlyle are prone to give more attention to the titled ruler of a little principality or the petty politician of Buncombe county than to the great captain of industry who takes the whole world for his realm.’ It is time for the politicians and soldiers to step aside and give a place in literature to the business men commensurate to that they are taking in producing civilization. After all, the captains of industry are as admirable by any ethical standard as the men who have been celebrated all these years in song and story. They have been and are self-seeking, but so are priests and kings. They have done their particular job better, on the average, than those other leaders of mankind. But the business man has suffered from the popular idea that his work at its best is discreditable. He has had none of the éclat that attaches to potentates and primates and grand marshals and premiers — even the basest. That is why the world is so slow to recognize that the most admirable and efficient piece of work being done to-day is the work business is doing. No king, or general, or priest, is accomplishing as much, even in the terms of his own metier, as the captains of industry — the Vails, Swopes, Youngs, Fords, Altmans, Wanamakers, Filenes, Hoovers, Schwabs, and Laments. Business is doing its job, and as much cannot be said of the traditional and historic leaders of mankind.
The next step is to draft this intensive training to the solution of the problems of the world. They would be helped by a little real executive experience. The work of governing is given, not to the man trained to govern, but to the man experienced in politics. The ability to be elected to an office is very different from the ability to fill that office. In fact, politics is a disqualification for the businesslike job of governing. We read in the newspapers that Hoover is popular with the people, but the politicians are afraid of him. They are afraid of him because he is not a politician and has a business man’s contempt for politics and all its works. Politicians will never conspire to put business men into office. The contrast of results would be too great. But it is time the people did. The world needs the training that these men have been getting. Government is becoming more and more a matter of commerce, of business; and the attempts of the professional lawmakers to grapple with business, or even understand it, are laughable. And not only domestic government, but world politics needs some of the direct, informed, and practical ways that characterize the conduct of a business. Says an editorial in the Nation ’s Business: —
If the war has taught us anything, it has lessoned us in the economic solidarity of the world. We have learned that no man liveth to himself nor dieth to himself. What is true of individuals is true of nations. When the British Government released its accumulated war stocks of wool in 1921, the market collapsed, and there was not a shepherd on the lonely plains of Australia or the slopes of Judea who did not feel the pinch of hard times. When the Russians withdrew from the Paris perfumery market, rose gardens in the secluded valleys of the mountains of Bulgaria, which had been producing attar of roses for fifty years, were left untended.
We have learned that trade, whether national or international, is based upon the exchange of the peculiar products of the industry and genius of one man for the fruits of another man’s industry and genius.
Both may profit by the exchange. Before the war we regarded the British as our principal trade rivals. We are coming to regard them as customers rather than rivals. As international traders we have more to gain from Britain prosperous than from Britain depressed.
That eternal job of administering this planet must be turned over to the despised business man. The work that religion, government, and war have failed in must be done by business. There is no country in the world as efficiently governed as the American Telephone and Telegraph Company or the General Electric Company. Business has become the world’s greatest benefactor.
As Emerson, with prophetic vision, observed some seventy years ago: ‘After all, the greatest meliorator of the world is selfish, huckstering trade. ’