470 TRANSACTIONS OF SECTION F. 
Australian democracy is thus an instinctive unrational human movement, 
a definite challenge to the canons of economic theory. An experience gained 
under such circumstances should be of considerable value, because it exhibits 
phenomena which might otherwise remain hidden. It shows us_ social 
institutions in a condition of disturbance, and enables us to see their working 
more clearly. 
The characteristic note of Australian democratic development, therefore, is 
the attempt to secure social ends by State activity. The more typical forms of 
such activity are :—(1) Nationalisation. (2) Regulation of various social con- 
ditions. (3) Regulation of wages. : 
(1) Nationalisation.—Australian experience cannot be said to directly nega- 
tive the warnings against State socialism. Yet the issues would not be stated 
in the old way. Many exceedingly valuable results attainable only by the 
exercise of State authority have been obtained. Much efficient work has been 
done by State departments, while, on the other hand, many gross failures can 
be recorded. A dogmatic condemnation of, or a bias against, State activity 
could not be maintained. Each phase must depend upon its own conditions. 
The tendency to monopoly in industry brings the issue of nationalisation more 
definitely before the public. 
(2) Regulation of Social Conditions—To avoid the evils of centralisation 
and the danger of elaborate State-directed schemes, the State will frequently, 
instead of assuming the management of an industry or activity, regulate certain 
phases of social life so as to secure ends considered desirable. In other cases 
it may perform an important service upon which a great many other social 
activities depend, or it may control a tendency which, if unchecked, would 
thwart the beneficial operation of the normal social forces. Thus the State 
insists upon conditions necessary to secure health and leisure for workers. 
It controls building, and formulates food standards. It investigates and 
guarantees the title to land. On the whole, experience in Australia is favourable 
to such activity. After intervention of the State, the normal social activities 
have readjusted themselves, and while the desired ends have been attained 
the vigour and well-being of the community has not been impaired. 
(3) Legulation of Wages.—The main object of this legislation has been to 
secure industrial peace by fixing a mean wage between the demands of the 
worker and the offer of the employer. It has to a large extent failed in this 
object because it has been used as a means of securing higher wages. The 
question is whether the machinery set up has been successful in increasing 
real wages. The conclusion of the writer is that though the machinery is 
defective in many ways the real wages of the workers have been increased by it. 
A close examination of the economic conditions in Australia would be required 
to substantiate this conclusion. The enormous resources of Australia available 
to a small population and the relatively constant demand of labour, place 
Australia in a unique position. The effect of alien exclusion laws and _pro- 
tection, as barriers to the supply of substitutes for highly paid labour, would 
have to be considered. On the other hand, evidence as to the effect of high 
wages and liberal conditions on the efficiency of the worker and of industrial 
organisation are important. The progressive effect of a transference of 
resources from the wealthier to the poorer classes on the general efficiency and 
stability of the economic system is another factor in the assessment of the value 
of such a system. Factors on the negative side would also have to be taken into 
account. At the present time a notable feature of the position is that wage 
regulation has intensified the capitalistic organisation and assisted the tendency 
to monopoly and agreements fixing prices. The political effect of the rise in 
the cost of living is likely to be very great. The masses now believe that the 
capitalistic classes have turned the tables on them. Some further step by 
representatives of the workers to relieve the pressure of the rise in prices seems 
certain. Such action will be either an attempt to fix prices in monopolistic 
industries, or wholesale extension of the principles of Nationalisation. In 
unofticial sections of the masses some steps in the direction of Guild Socialism 
or Syndicalism is strongly advocated. From the scientific point of view, a 
gradual perfection of the agencies we have already installed would seem 
desirable. But the exigencies of politics render more drastic action certain. 
In such action the fundamental issues of social organisation are likely to be 
