114 SECTIONAL ADDRESSES. 



exercise in ingenuity to fill in other types. The combination HC, H, RI, 

 gives the Investment Trust (IT) ; the secrecy motive S yields one of the 

 ' Kings of rats ' (R). There are various other forms of Concern. Dr. 

 Saitzew has by this means done something to rationalise the argument 

 itself. His method indicates the range of organisations, which is neither 

 all ' monopolist ' nor all ' rational.' 



XL 



In the policy of rational industrial administration, as it is usually 

 presented, restriction is involved, on the ground of the attempt to adapt 

 production to a proper rate, to overcome duplication, overlap, or 

 speculation, and to give control through leadership. There are some 

 important cases where this policy is carried out under public auspices, and 

 these involve an admission of necessary organised action, to which private 

 enterprise on similar lines may appeal for a general sanction. Instances 

 are the Brazilian plan for the valorisation of coffee, that is, the adjustment 

 of sales under the instrumental use of prices ; the British rubber scheme ; 

 the Greek ' Retention ' in the currant trade ; and the German control of 

 potash. The last two of these may be specially noticed, as important 

 cases of the refusal to let competition work itself out, but with some 

 difference in the fundamental conditions. 



The Greek Retention arose out of the fact that the currant crop is of 

 vital importance in the export trade, and is grown by small producers. 

 When the French vineyards were ravaged by the phylloxera after 1879, 

 Greece supplied the deficiency, so that the currant Was described as the 

 ' saviour ' of the wine industry. There was a great extension of plantation 

 in Greece, the peasants being advanced loans by the State, and great 

 prosperity till about 1890. Then France, having repaired her vineyards, 

 killed the trade with heavy duties. There was so little elasticity in the 

 ' pudding ' demand of England, that prices fell ruinously and did not 

 cover freights. The peasants were faced with ruin, and the Government 

 with revolution in the Morea. It was therefore decreed that a percentage 

 of the crop was not to be exported but retained at home, and this per- 

 centage had risen to 35 before the war. At first the Government, after- 

 wards a Privileged Company, received this ' Retention,' to be disposed 

 of at home by finding some new use for it, as currants are not consumed in 

 Greece itself. The complicated arrangements would require a long state- 

 ment, but they amounted to ' home dumping ' on industries which 

 extracted alcohol, or on the Greek wine trade, at prices far below the export 

 prices. Heavy taxes were laid on new plantations, and funds were raised 

 by the Company to compensate cultivators of plantations given up. All 

 this was done against the opposition of those who contended that the 

 whole idea was wrong, and that natural laws should work themselves out. 

 The Privileged Company, getting 35 per cent, of the crop for nothing, was 

 so successful that it was bought up in 1924, and the problem is still 

 unsettled. But it shows the following features. The control was con- 

 sidered specially necessary, because the units of enterprise were individual 

 peasants faced with ruin. The organisation yielded, for a long time at 

 least, a solution, because organised effort was able to create conditions 

 which would not otherwise have been possible. The new competitor 



