106 SECTIONAL ADDRESSES. 
determined to a greater degree than that of any other section of society 
by the amount of wages they receive. In other walks of life a man’s 
titles or his learning or his particular standing frequently are not related 
to the amount of income he receives, but with the workers a man’s 
standing is almost entirely related to his income. Men, women, and 
their children are judged, and their social conditions are determined, 
by the amount of wages or salary which they are able to earn and the 
consequent standard of life that they are able to maintain.’ He pro- 
ceeded to make a comparison between the wages of railway men and 
those of other callings—in particular dockers, miners, policemen, and 
municipal workers—with the object of showing that the pay of railway 
men was low in comparison with that of other walks of life. 
The fact that any particular industry is making large profits is not— 
per se—a ground for increasing the remuneration of the workers any 
more than the fact of a Budget surplus is a justification for increasing 
the salaries of Civil Servants all round. We feel that the general tax- 
payer is entitled to the saving, and it may be that the general public is 
entitled to participate in the prosperity of an industry either through 
a reduction in prices or through the taxation of profits. 
Another objection to profit-sharing deserves a brief mention. It 
is that if it is to succeed the capital employed must be high in relation 
to the wages paid, otherwise the profits to be shared will be insignificant. 
Suppose, for example, that the capital employed in a business is 
1,000,0001., and the annual wages are 3,000,0001., as might well 
happen in a shipyard; suppose, again, we assume the profit earned to be 
10 per cent., which would be a very high average in the shipbuilding 
trade—before the War it did not, I believe, exceed 3 per cent. for the 
industry. If half the profits went to capital and the other half were 
shared between labour and capital—a very common form of profit- 
sharing—labour would receive 25,000I., or an addition of only twopence 
in the £ on its wages. Bearing in mind the increases that have actually 
taken place in recent years, it will be recognised that such an addition 
would be regarded as insignificant. The fact is that in any country 
where labour is well organised wages absorb as much as can be allotted 
to labour consistently with a reasonable return to capital. And if a 
reasonable return is not offered to capital no capital will be forth- 
coming. 
It is extremely doubtful if labour would tolerate a different remunera- 
tion between the various firms within an industry owing to the im- 
portance attached to the maintenance of a definite relation between the 
wages of different groups of men. But if they were prepared to accept 
a differentiation other forces would counteract it. A successful firm 
making large profits would be able to offer higher remuneration than 
an unsuccessful one, and thus attract the best men. Theoretically 
this may seem right and proper, but in practice the unsuccessful 
firm would find itself obliged to guarantee a bonus to its workers 
equivalent to the share of the profits accruing to the workers in the 
more prosperous ventures. Otherwise it would find that it could only 
attract the least efficient workers at a time when efficiency was most 
needed to save it. 
