PRESIDENTIAL ADDRESS. 241 



iReferene« has already been made to my own examination of tliis matter, which 

 leaves me in no doubt that any considerable inci'ease of the part of labour 

 would have left the share of capital so small as to have stifled enterprise. 



This does not mean that large fortunes may not have been made by those 

 whose skill and imlnstry and enter-prise enabled them to seize the advantages 

 presented to them. If an illustration may be drawn from the history of my own 

 firm, I may say that over and over again have we embarked on undertakings 

 which we Iiad iu the end to abandon as improiitable. Those who were, in fact, 

 our co-adventurers, the men whom we employed, ran no risk. They were paid 

 the sums to which they were entitled as the result of bargaining in an open 

 mai'ket. The wages paid were those ruling in the district. Such machinery or 

 other supplies as were needeVl were bought as cheaply as was possible. We took 

 all the risk, and bore all the loss which often resiilted. Wc had no qualms 

 about taking the profit when any ensued. The capit.al which by incessant 

 industry and application has been thus accumulated has served tto provide 

 employment for the sons and grandsons and remoter descendants of those who 

 first worked for my father and his brothers seventy-five years ago this very year. 



Those who cry out against capital overlook the fact that in modern industries 

 no man can be set to work except by means of a capital sum first found for the 

 purpose. In the industries I know best something over £200 is needed to put 

 a man to work. The population of this country increases at the rate of alxiut 

 1 per cent, per annum. This means that for every 1,000 men to whom employ- 

 ment is being given about ten youths are ready to be set to work each ,year, and 

 something over £2,000 must be fomnd year by year to give them employment. 

 It is not an unreasonable boast for a captain of industry to say that in this 

 respect he has performed his duty to the community. 



One further point must be made. Men see sonie great enterprise (and the 

 railways will serve very well as an example), and look upon it as a capitalist 

 organisation. But when the circumstances are examined it is found that it 

 consists of a multitude of small holdings, and comparatively few of lirge amount. 

 In the North-Eastern Eailway something like 60,000 shareholders hold the 

 83 million pounds of capital of various denominations — say, on the average, some 

 £1,600 each. Consider the widespread distress which would be caused if the 

 income from the .«)im were to cease. 



I have made a similar calculation for a large colliery undertaking in which 

 I am interested, with the following result. The capital in shares and debentures 

 is about £1,300,000. There are just over 1,800 shareholders. We employ 

 5,500 men. Each shareholder therefore provides employment for about three men 

 and holds on the average £725. Before long we shall reCjuire further capital. 

 We see our way to enlarge our operations and so to provide employment near 

 to their homes for the 50 to 60 youths who, each year, grow to manhood and 

 need productive employment if they are not to become burdens on the com- 

 . munity. We hope our 1,800 shareholders will have laid by enough to provide 

 the £12,000 a year which is necessary for this purpose. We are assuming they 

 or someone will provide it, for we are using our resources (reserves and depre- 

 ciation funds) in this way, and shortly it will be incumbent on us to fund this 

 obligation and add it to our capital. 



Let us be very cautious how we interfere lest we produce evils infinitely 

 greater than those which it is sought to remove. What, for example, will those 

 50 to 60 .young men say, if we reply to their applications to be given work with 

 us, that all our resources have been used in paying additional wages, and we 

 have accordingly been obliged to let our plant deteriorate instead of adding 

 to it and that, far from offering additional employment, we fear we may have 

 to dismiss men to whom we at present give work ? 



We are thus brought to the last subject which I desire to consider with you— 

 the widespread tendency towards what is somewhat vaguely called Nationalisa- 

 tion. It may be questioned whether any large number of people have very clear 

 ideas what is meant by the term. 



Let us assume for the present purpose that it signifies that the State shall 

 become the owner of any enterprise which is nationalised — as it owns the busi- 

 ness—the Post Office, the Telegraphs and the Telephones. Let us ask what 

 advantage will be gained by the assumption of ownership. A centralised 



