Page:The Economics of Unemployment.djvu/119

rural in their character does the new situation make perceptibly for a growing proportion of saving to spending. For the rural populations are at once more conservative in the standard of living, and are put in possession of larger surpluses for saving.

In developed industrial countries the attainment of a better distribution of income, in order to secure a better adjustment between production and consumption, depends upon whether the wage-earners and the State can between them absorb most of the unearned and unneeded surplus of the rich. So far as the struggle is a purely economic one between organised labour and organised capital, it is not easy to see how the former can prevail, unless it can both obtain a normal basic wage which leaves little surplus profit and also stop the wage-lag which, assisted by speculative credit, is seen to be responsible for over-production and consequent depression. During a depression the power of organised capital to break down the wage standards and bring labour to heel, is implicit in the economic situation. Labour can only defend itself effectively by political weapons, supposing it can get them and learn how to use them.

In this truly political economy there are three chief instruments. The first is the establishment of a common rule of minimum conditions of labour and of living, in the shape of wage, hour and other conditions, made obligatory in all employments. The second is the assumption by the State, municipality or other governing body, of the ownership and operation of (or at least the control of wages, prices and other conditions in) those essential services and in-