314 THE POPULAR SCIENCE MONTHLY. 



consumer disappears. Speculation takes the helm. Much more is 

 produced than there is corn, leather, or other goods, to exchange for 

 it. The resources of the mills are great ; they can borrow from the 

 banks while they pile up their fabrics in their ware-rooms; they can 

 by means of their concentrated capital keep their machinery running, 

 even at a loss, if by so doing they can crush out a rival or manipulate 

 the market. 



But in the height of this prosperous run there is a check no 

 matter for Avhat cause and suddenly the work stops. There is little 

 sale for goods produced ; the fires must be put out, the doors closed, 

 and thousands of operatives are deprived of employment. This 

 would not be so unfortunate if tljis over-production had been diffused 

 among the work-people. But it had not. Notwithstanding the high 

 pressure and the excessive manufacture, wages have been kept down ; 

 while producing in six months as much as could be exchanged in a 

 year, the workmen have not been paid in this way their wages have 

 been upon the basis of the whole year's work as a result, they are 

 turned empty-handed upon the street. And, what is particularly un- 

 fortunate, tliey are reduced as consumers to the minimum point. 

 Here the evil works both ways. The excessive production which has 

 shut up the mill has weakened the power of the community to absorb 

 this production the goose that laid the egg has been slain. 



Inevitably the recovery from hard times brought about in this 

 way must be slow. The spindles cannot be set in motion until the 

 stock of goods on hand is reduced and a fresh demand revives; this 

 demand cannot revive because the great body of consumers are in a 

 state of impoverishment. This condition of things is entirely suffi- 

 cient to explain the genesis and the prolongation of business prostra- 

 tion. Capital is not impaired: it is locked up in machinery that is 

 silent, in goods that cannot be exchanged, in money that has no bor- 

 rowers. It is the paralysis of consumption that is the cause ; and this 

 paralysis has been brought about by an unregulated production, by 

 an excess that is not diffused, by the stoppage of wages, by tlie idle- 

 ness enforced upon those who would be consumers, by the absence of 

 an adjustment of production to consumption. Is it not clear that we 

 must have a regulated production ; that machinery with its magical 

 facility must be put in check ; that we must restore the old cautious 

 and intelligent relation between the two factors of supply and 

 demand ? 



We read lately a very angry denunciation of a combination be- 

 tween certain mine-owners in Pennsylvania to limit the production of 

 coal. Why? If these men are attempting to make an artificial 

 scarcity, it is wrong, and all attempts of this kind fail ; but if they 

 mean simply to regulate the marketing of coal of cooperating so 

 that an excess of the article shall not be thrown upon the market, 

 and prices forced below cost they are right. It is better for them to 



