These biological laws of evolution of society explain the utter failure of State management of what are called public utilities, but which are really local organs in the body politic. Hugo R. Meyer, formerly Professor of Political Economy in the University of Chicago, has investigated this matter for many years and has published two books on the subject, "Municipal Ownership in Great Britain" and "Government Regulation of Railway Rates."* He proves conclusively that it is always a disaster to the society if the ruling units take charge of matters which the working units alone are able to do. The delusion is widespread that if government only takes charge of something it is done properly, even though it has not the brains or bodies to work with. It is forgotten that the brains of the country are apt to be in the employ of corporations and will not work for the poor pay of government office. The delusion arises in the lower layers of society - the less intelligent ruled elements - which always look up to the rulers to initiate and manage everything for them. It is the Russian peasant's stupid way of demanding everything of "The little father" - the Czar. It is the sign of racial childishness and the opposite of the Aryan democratic spirit. Meyer proves that State ownership or regulation invariably paralyzes industry because it interferes with that private initiative which has made America the leader. In this we owe an immense debt to the democratic party, which insists upon keeping hands off individual liberty and corporation liberty. In the great public utilities, telegraph, telephone, trolley lines, railroads, lighting and power, we lead the world. State management in Europe has paralyzed advancement - individual liberty in America has pushed it.
The cause is far deeper than Meyer imagines, for State ownership violates biological laws. The cell-citizens in the liver form a monopoly, do all of this kind of work and cannot be replaced. They are merely controlled by nerve cells. The other glands, salivary, peptic, etc., are merely so many trusts in our bodies.
* Macmillan Co.
It is true, then, that the formation of gigantic self-governing trusts is in the natural direction and bound to come. Yet the brain cannot take over the functions of the liver, nor can the government economically take over the furnishing of food, light, power or water. These are duties of groups of units, working for themselves while aiding the government. The nervous system does, indeed, check and guide the liver in its activities, but the "will" cannot manage it. Some control of trusts is, therefore, the natural course of events, but it is unnatural for the government to assume charge of them and try to do what only they themselves can do. The New York Public Utilities Commission is a step toward the future social control of all groups of units, for every group is a public utility of some sort.
So we need not worry unduly about the trusts, for they cannot long violate the law of mutual aid even if they are violating it now. No body of units can survive if it becomes so powerful that it injures the organism by which it is subsisted. Every organ of our bodies dwindles in size if it happens to be too big. The trusts will dwindle if they cannot sell their goods. People who cry out too much against the trusts do not understand that natural law is regulating the matter. Indeed, the people themselves are directly responsible for the existence of the trusts, because we all buy from those who sell cheapest and thus perpetuate the biggest companies which generally, if not always, produce things the cheapest. It is even worse than that; we have always helped the trusts or big corporations to kill off the small rivals. If the Standard Oil Company desired to kill a retailer who did not sell its goods, it merely started a store next door to sell below cost. The people flock to the cut-rate place to save a few pennies - the small dealer is ruined - and then the price of oil goes up to its normal or above. The people, for a few pennies, have killed competition, and if they should suffer a little while, it is their own fault. Nevertheless, the trusts arc really huge organs in the body politic like the liver trust in our own bodies, and both obey the same natural laws of organization and control.
The fallacy in most of the Utopian plans of a certain class of socialists is the belief that salaried agents of a government are more competent in any business than men who arc working for themselves. If a man manages his own coal mine, it docs not increase his efficiency to buy his mine and put him on a salary, but decreases it. When private enterprises are unrestrained, there is a survival of the most efficient, and the least efficient fail - but if salaries are given, the least efficient survive with the others. There are a few instances of success in municipal ownership of milk routes, for instance, but far better results follow from supervision of private dealers. The true socialism is government regulation of every business, and that comes of- itself by a gradual evolution. New York City tried to light one of her bridges, using free fuel from city wastes, but found that it would be cheaper to buy the light from a private company. Italy invested hundreds of millions in railroads, which do not pay interest or even running expenses, the surplus being raised by taxation, and the service is execrable. Australia had the same experience. London's democracy demanded all sorts of free public service, even municipal houses, but the only result is to increase taxes unbearably. So the present demand of thinking men is to end the paternalism so harmful to the lower layers which demand it, and limit governmental functions to a mere control of groups of units - the plan of nature. We cannot safely assume their duties, for we may injure both the trust and ourselves. Rate reduction is now known to be harmful to the railroads and reflexly the public, as our Southern legislatures are sorrowfully discovering.