TRANSACTIONS OF SECTION F. 693 



overcrowding, in so far as it attracts new inhabitants to the spot ; a policy which 

 assumes that the comparative plentifiilness of houses is not a factor in the deter- 

 mination of the enormous and perpetual migration of people from place to place 

 which is indicated in the tables of birthplaces and births and deaths in the census, 

 is doomed to failure. Secondly, economic theory suggests the reflection that the 

 mere fact of a local authority building some houses will not cause the whole 

 number to be greater, if for every house built by the local authority one less is 

 built by private enterprise, and that this is very likely to happen. Houses have 

 been built by private enterprise in the past, and in these houses nearly the whole 

 population is at present housed. I have seen an enthusiast for municipal housing 

 stand in the empty streets of a town late at night, when every soul in the town 

 was evidently housed, and say, in a tone of conviction, ' Private enterprise has 

 failed.' In that town four small houses had been built by municipal enterprise 

 and more than ten thousand by private enterprise, and private enterprise was 

 adding hundreds every year, while the housing committee of the corporation was 

 meeting once a year to re-elect its chairman. Is it likely that private enterprise 

 will build as much when it is competed with or supplemented by — the term does 

 not matter — municipal enterprise ? Why should it ? If the municipality turned 

 baker, would the private bakers continue to bake as much bread ? Is not the 

 attempt to stop overcrowding by inducing local authorities to build houses exactly 

 the same thing and just as absurd as it would be to attempt to cure under-feeding 

 by opening municipal butchers' and baker.<(' shops? 



In the long run, I admit, experience teaches. Protection has fallen once in this 

 country, and I have little doubt that it will fall again if it becomes considerable. 

 The policy of obstructing the removal of dwellings from the centre of a great city 

 already excites opposition in the London County Council, though unanimity still 

 reigns in those last homes of extinct superstitions, the Houses of Parliament. 

 Chancellors of the Exchequer and finance committees may be trusted to offer a 

 stout resistance, on what they call financial grounds, to any really great develop- 

 ment of the system of subsidies. There is hope even that the municipal building 

 policy may be checked by the laborious inquiries which show by statistics what 

 everyone knows, that the poor are ill-fed and ill-clothed as well as ill-housed, and 

 therefore lead people to consider how the poor may be made more able to pay for 

 houses, among other things, instead of simply how houses may be built in the 

 absence of an effective demand for them. But I claim that, in matters such as 

 these, a more widespread appreciation of economic theory, and the quickened 

 intelligence which that would produce, would save us much painful experience, 

 many expensive experiments, and an enormous mass of tedious investigation. 



Thirdly and, at any rate on the present occasion, lastly, I claim that the 

 teaching and study of economic theory has great practical utility in promoting 

 peace and good will between classes and nations. 



Between classes within the same nation the peacemaking influence of economic 

 theory lies chiefly in the fact that it tends to get rid of that stupid cry for ' rights ' 

 and 'justice ' which causes and exacerbates industrial and commercial quarrels. 

 "When demand for some commodity falls, or supply from some new quarter arises, 

 and profits and wages fall, the workers cry out that they are being unjustly 

 treated, because they have the unfounded belief that reward is or ought to be 

 proportional to moral merit, and they are not conscious of any diminution of their 

 moral merit. They demand a living wage or a minimum wage and employment 

 for all who happen to have been hitherto employed in the trade, rend the air with 

 complaints, and get subscriptions from a compassionate but ill-informed public. 

 We cannot, of course, expect people who suffer by them to regard even the most 

 beneficial operations of the economic organisation with enthusiasm or even satis- 

 faction. It would be absurd to do so. But all the same, it is true that a wider 

 apprehension of the fact that it is only by raising and lowering the advantages 

 offered by different employments that production is at present regulated so as to 

 meet demand would not only diminish the dissatisfaction, but also, which is more 

 important, diminish the actual suffering by causing transitions to be less 

 obstinately resisted. The present fashion of deploring rapid changes of trade and 



