CONTENTS (1), Docs. 1-51: Just World Campaign

The Chinese on the Pacific Coast

 
   New York Tribune article by Henry George (as quoted in The Life of Henry George, Book © 1900, 1960 edition, by Henry George, Jr., pp 193-94, New York, Robert Schalkenbach Foundation); Article published May 1, 1869
   "The population of our country has been drawn from many different sources; but hitherto, with but one exception, these accessions have been of the same race, and though widely differing in language, customs and national characteristics, have been capable of being welded into a homogeneous people.  The mongolians, who are now coming among us on the other side of the continent, differ from our race by as strongly marked characteristics as do the negroes, while they will not as readily fall into our ways as the negroes.  The difference between the two races in this respect is as the difference between an ignorant but docile child, and a grown man, sharp but narrow minded, opinionated and set in character.  The negro when brought to this country was a simple barbarian with nothing to unlearn; the Chinese have a civilisation and history of their own, a vanity which causes them to look down on all other races, habits of thought rendered permanent by being stamped upon countless generations.  From present appearances we shall have a permanent Chinese population; but a population whose individual components will be constantly changing, at least for a long time to come – a population born in China, reared in China, expecting to return to China, living while here in a little China of its own, and without the slightest attachment to the country – utter heathens, treacherous, sensual, cowardly and cruel.  They bring no women with them (and probably will not for a little while yet).  . . .
   "Their moral standard is as low as their standard of comfort, and though honest in the payment of debts to each other, lying, stealing and false swearing are with the Chinamen venial sins – if sins at all.  They practise all the unnamable vices of the East, and are as cruel as they are cowardly.  Infanticide is common among them; so is abduction and assassination.  Their bravos may be hired to take life for a sum proportionate to the risk, to be paid to their relatives in case of death.  In person the Chinese are generally apparently cleanly, but filthy in their habits.  Their quarters reek with noisesome odours, and are fit breeding-places for pestilence.  They have a great capacity for secret organisations, forming a State within a State, governed by their own laws; and there is little doubt that our courts are frequently used by them to punish their own countrymen, though more summary methods are oftentimes resorted to.  The administration of justice among them is attended with great difficulty.  No plan for making them tell the truth seems to be effective.  That of compelling them to behead a cock and burn yellow paper is generally resorted to in the courts.  . . .
   "The Chinese seem to be incapable of understanding our religion; but still less are they capable of understanding our political institutions.  To confer the franchise upon them would be to put the balance of power in the Pacific in the hands of a people who have no conception of the trust involved, and who would have no wish to use it rightly, if they had – would be to give so many additional votes to employers of Chinese, or put them up for sale by the Chinese head centres in San Francisco."

[Mill said Chinese immigration would reduce wages.]

 
   John Stuart Mill, the English philosopher, writing from Avignon, France, in reply to Henry George's Tribune article "The Chinese on the Pacific Coast," (letter as quoted in The Life of Henry George, Book © 1900, 1960 edition, by Henry George, Jr., pp 198-200, New York, Robert Schalkenbach Foundation); letter dated October 23, 1869, published in Transcript on Saturday, November 20, 1869
   Avignon, France, Oct. 23, 1869.
   "DEAR SIR : The subject on which you have asked my opinion involves two of the most difficult and embarrassing questions of political morality – the extent and limits of the right of those who have first taken possession of the unoccupied portion of the earth's surface to exclude the remainder of mankind from inhabiting it, and the means which can be legitimately used by the more improved branches of the human species to protect themselves from being hurtfully encroached upon by those of a lower grade in civilisation.  The Chinese immigration into America raises both of these questions.  To furnish a general answer to either of them would be a most arduous undertaking.
   "Concerning the purely economic view of the subject, I entirely agree with you; and it could be hardly better stated and argued than it is in your article in the 'New York Tribune.'  That the Chinese immigration, if it attains great dimensions, must be economically injurious to the mass of the present population; that it must diminish their wages, and reduce them to a lower stage of physical comfort and well-being, I have no manner of doubt.  Nothing can be more fallacious than the attempts to make out that thus to lower wages is the way to raise them, or that there is any compensation, in an economical point of view, to those whose labour is displaced, or who are obliged to work for a greatly reduced remuneration.  On general principles this state of things, were it sure to continue, would justify the exclusion of the immigrants, on the ground that, with their habits in respect to population, only a temporary good is done to the Chinese people by admitting part of their surplus numbers, while a permanent harm is done to a more civilised and improved portion of mankind.
   "But there is much also to be said on the other side.  Is it justifiable to assume that the character and habits of the Chinese are insusceptible of improvement?  The institutions of the United States are the most potent means that have yet existed for spreading the most important elements of civilisation down to the poorest and most ignorant of the labouring masses.  If every Chinese child were compulsorily brought under your school system, or under a still more effective one if possible, and kept under it for a sufficient number of years, would not the Chinese population be in time raised to the level of the American?  I believe, indeed, that hitherto the number of Chinese born in America has not been very great ; but so long as this is the case – so long (that is) as the Chinese do not come in families and settle, but those who come are mostly men, and return to their native country, the evil can hardly reach so great a magnitude as to require that it should be put a stop to by force.
   "One kind of restrictive measure seems to me not only desirable, but absolutely called for ; the most stringent laws against introducing Chinese immigrants as coolies, i.e., under contract binding them to the service of particular persons.  All such obligations are a form of compulsory labour, that is, of slavery ; and though I know the legal invalidity of such contracts does not prevent them being made, I cannot but think that if pains were taken to make it known to the immigrants that such engagements are not legally binding, and especially if it were made a penal offence to enter into them, that mode at least of immigration would receive a considerable check ; and it does not seem probable that any mode, among so poor a population as the Chinese, can attain such dimensions as to compete very injuriously with American labour.  Short of that point, the opportunity given to numerous Chinese of becoming familiar with better and more civilised habits of life, is one of the best chances that can be opened up for the improvement of the Chinese in their own country, and one which it does not seem to me that it would be right to withhold from them.  I am, dear sir,
   "Yours very sincerely, J. S. MILL.
   "Henry George, Esq., San Francisco, Cal."

[Comment that Mill's letter supported restrictions, and tribute to him.]

 
   Henry George, editor of Transcript, replying to J.S.Mill's letter supporting restrictions on Chinese immigration (as reprinted in The Life of Henry George, Book © 1900, 1960 edition, by Henry George, Jr., pp 200-202, New York, Robert Schalkenbach Foundation); November 20, 1869 and afterwards.
   Commenting on this, the "Transcript" editorial said : "With all its qualifications, Mr. Mill's opinion entirely justifies the position of those who take ground in favour of restrictions upon the immigration of these people," for "Chinese labour has already begun to compete injuriously with white labour, and that it will soon be competing very injuriously, no one who has noticed how rapidly these people are entering and monopolising one branch of business after another, can have any doubt."  Moreover, nine-tenths of the Chinese immigrants are contract labourers and it would be useless to pass laws against such contracts ; while as for slavery, "Chinese women are sold and staked at the gambling table in San Francisco every day of the week." The editorial concluded with this tribute to the eminent English economist :    The "Transcript" editorial with the Mill letter made something like a sensation throughout California.  Some of the pro-Chinese papers republished both in garbled form, and in such form the letter may have got back to Mill.  [...]
   Some of the pro-Chinese papers in California ... took to abusing Henry George; one of them, the San Francisco "Bulletin," saying that Mill had been misled by George in the "New York Tribune" article, as that was "written from the exaggerated standpoint of a certain class of political alarmists ..."

   REPORT OF THE JOINT SPECIAL COMMITTEE TO INVESTIGATE CHINESE IMMIGRATION, U.S.A., February 27, 1877; http://cprr. org/Museum/ Chinese_ Immigration. html .  [February 27, 1877]

[Nominated by Anti-Coolies and independent groups.]

 
   The Life of Henry George, Book © 1900, 1960 edition, by Henry George, Jr., p 288, New York, Robert Schalkenbach Foundation; occurrences around August 20-26, 1877
   SAN FRANCISCO, U.S.A.: In his diary he noted on August 20, "Found I had been nominated for the State Senate at Charter Oak Hall," an independent political organisation.  Five days later the diary showed that he was "nominated last night by Anti-Coolies," a workingmen's anti-Chinese movement. ... wrote declination to Anti-Coolies ... wrote declination to Charter Oak ..."

[Workmen denounce monopolies, Chinese immigration.]

 
   The Life of Henry George, Book © 1900, 1960 edition, by Henry George, Jr., p 290, New York, Robert Schalkenbach Foundation; occurrence in 1877
   SAN FRANCISCO, U.S.A.: In California the depression was deepened by a drought during the preceding winter months and by a heavy decline in the output of the silver mines on the Comstock Lode, which brought down all the stocks on the California exchanges and for the time stopped the speculation of the outside world through this market.  At this period when workmen all over the State were idle, the Central Pacific Railroad, controlling practically every mile of track in the State, proposed to reduce wages.  In San Francisco workmen held mass meetings, to denounce on the one side the great monopolies, and particularly the railroad, as oppressing the masses of labouring men; and on the other, Chinese immigration, as subjecting them to starvation competition.

[In 1892 came U.S. ban; right of exclusion defended]

 
   The Life of Henry George, © 1900, 1960 edition, by Henry George, Jr., pp 201-203, New York, Robert Schalkenbach Foundation); reporting 1892, etc.
   The "Transcript" editorial with the Mill letter [November 20, 1869] made something like a sensation throughout California.  Some of the pro-Chinese papers republished both in garbled form, and in such form the letter may have got back to Mill. [...]
   Some of the pro-Chinese papers in California ... took to abusing Henry George; one of them, the San Francisco "Bulletin," saying that Mill had been misled by George in the "New York Tribune" article, as that was "written from the exaggerated standpoint of a certain class of political alarmists who either have not carefully studied the facts or who use the question as a good demagogue card to win ignorant votes."  But notwithstanding such utterances, George's "New York Tribune" article expressed a strong and strengthening sentiment that soon dominated State politics, inspired a long series of legislative acts, and eventuated in 1892, twenty-three years afterwards, in the passage by Congress of the Geary law, prohibiting "the coming of Chinese persons into the United States" and providing for deportation under certain conditions.
   To the end of his life Mr. George held to the views against free entrance of the Chinese set forth in his "Tribune" article in 1869.  They appear in many of his subsequent California speeches and writings, and in 1881 were set out fully in a signed article published in Lalor's "Cyclopedia of Political Science, Political Economy and of the Political History of the United States."
   And when in the fall of 1893, William Lloyd Garrison of Boston addressed a letter to James G. Maguire, who represented the Fourth California District in Congress, upbraiding the congressman with being false to his single tax principles of equal rights, in supporting and voting for an amendment extending the Geary Chinese Exclusion Act, Mr. George replied (New York November 30), a copy of the letter to Maguire having been sent to him by Garrison:    But while approving of Chinese exclusion "under present conditions," Henry George could conceive of a state of things under which such a policy would not be necessary.  In a lecture in San Francisco ¹ while writing "Progress and Poverty," he said :  "Ladies and gentlemen, it is not only more important to abolish land monopoly than to get rid of the Chinese ; but to abolish land monopoly will be to make short work of the Chinese question.  Clear out the land-grabber and the Chinaman must go.  Root the white race in the soil, and all the millions of Asia cannot dispossess it."
____________________
¹ "Why Work is Scarce, Wages Low, and Labour Restless," Metropolitan Temple, March 26, 1878.

[Shortage of Purchasing Power] -- Economic Democracy

 
   Book Economic Democracy, 1920, by Major Clifford Hugh Douglas, Melbourne, The Social Credit Press; Parts of Chapter 5, pp 57-59, 61-65, Australian edition 1933 (original publication 1920)
   GREAT BRITAIN:  LOOKED at from this standpoint it is fairly clear that the kernel of the problem is factory cost, since it is quite possible to conceive of a limited company in which the shares were all held by the employees, either equally or in varying proportions, according to their grade, and the selling costs were internal – that is to say, all advertising was done by the firm itself, and the cost of its salesmen, etc., was either negligible, or confined to their salaries.
   We should then have the complete profit-sharing enterprise in its ultimate aspect, and the argument against Capitalism in its usual form would not arise. Such an undertaking would, let us assume, make a complicated engineering product, requiring expensive plant and machinery, and would absorb considerable quantities of power and light, lubricants, etc., much of which would be wasted; and would inevitably produce a certain amount of scrap the value of which would be less than the material in the form in which it entered the works.
   The machinery would wear out, and would have to be replaced and maintained, and generally it is clear that for each unit of production there would be three main divisions of factory cost, the "staple" raw material, the wages and salaries, and a sum representing a proportion of the cost of upkeep on the whole of the plant, which might easily equal 200 per cent, of the wages and salaries.
   As the plant became more automatic by improvements in process, the ratio which these plant costs bore to the cost of labour and salaries would increase. The factory cost of the total production, therefore, would be the addition of these three items: staple material, labour and salaries, and plant cost, and with the addition of selling charges and profit, this would be the selling price.
   As a result of the operations of the undertaking, the wealth of the world would thus be apparently increased by the difference between the value of all the material entering the factory, and the total sum represented by the selling price of the product.
   But it is clear that the total amount distributed in wages, salaries and profit or dividends, would be less by a considerable sum (representing purchases on factory account) than the total selling price of the product, and if this is true in one factory it must be true in all. Consequently, the total amount of money liberated by manufacturing processes of this nature is clearly less than the total selling price of the product.
   This difference is due to the fact that while the final price to the consumer of any manufactured article is steadily growing with the time required for manufacture, during the same time the money distributed by the manufacturing process is being returned to the capitalist through purchases for immediate consumption. [...]
   [p 61] But we know that the total increase in the personal cash accounts in the banks in normal times is under 3 per cent, of the wages, salaries and dividends distributed, consequently it is not to these accounts that we must look for effective demand. There are two sources remaining; loan-credit, that is to say, purchasing power created by the banks on principles which are directed solely to the production of a positive financial result; and foreign or export demand.
   Now loan-credit is never available to the consumer as such, because consumption as such has no commercial value. In consequence loan-credit has become the great stimulus either to manufacture or to any financial or commercial operation which will result in a profit, that is to say, an inflation of figures.
   [p 62] An additional factor also conies into play at this point. All large scale business is settled on a credit basis. In the case of commodities in general retail demand, the price tends to rise above the cost limit, because the sums distributed in advance of the completion of large works become effective in the retail market, while the large works, when completed, are paid for by an expansion of credit. This process involves a continuous inflation of currency, a rise in prices, and a consequent dilution in purchasing power.
   The reason that the decrease in the consumer's purchasing power has not been so great as would be suggested by these considerations is, of course, largely due to intrinsic cheapening of processes which would, if not defeated by this dilution of the consumer's purchasing power, have brought down prices faster than they have risen.
   There are thus two processes at work; an intrinsic cheapening of the product by better methods, and an artificial decrease [p 63] in purchasing power due to what is in effect the charging of the cost of all waste and inefficiency to the consumer. And it is clear that under this system the greater the volume of production the larger will be the absolute value of the waste which the consumer has to pay for, whether he will or no, because as the bank credits are created at the instance of the manufacturer, and repaid out of prices, each article produced dilutes, by the ratio of its book price to all the credits outstanding, the absolute purchasing power of the money held by any individual.
   These facts are quite unaffected by the perfectly sound argument that increased production means decreased cost per piece, since it is the total production price which has to be liquidated.
   Already there is not very much left of the argument for the innate desirability of unlimited, unspecified and intensified manufacturing under the existing economic system, but more trouble yet is ahead of it. While the ratio of plant charges to total wages and salaries cost is less than 1 : 1 over the whole range of commodities, a general rise in direct rates of pay may mean a rise (but not a proportionate rise) in the purchasing power of those who obtain their remuneration in this way.
   But when by the increased application of mechanical methods the average overhead charge passes the ratio of one to one (which it rapidly will, and should do on this basis of calculation) every general increase in rates of pay of "direct" labour may mean an actual decrease in real pay, because the consumer is only interested in ultimate products and overhead charges do not represent ultimate products in existence.
   The whole argument which represents a manufactured article as an access of wealth to the country and to everyone concerned, no matter what its description and utility, so long as by any method it can be sold and wages distributed in respect of it, will, therefore, be seen to be a dangerous fallacy based on an entirely wrong conception, which is epitomised in the use of the word [p 65] "production," and fostered by ignorance of financial processes.
   Manufacturing of any kind whatever, even agriculture in a limited sense, is the conversion of one thing into another, which process is only advantageous to the extent that it subserves a definite requirement of human evolution. In any case, it shares with all other conversions the characteristic of having only a fractional efficiency, and the waste of effort involved, although being continually reduced by improvements of method, still can only be paid for in one way, by effort on the part of somebody.
   If this effort is useful effort – "useful" in the sense that a definite, healthy and sane human requirement is served – the wealth and standard of living of the community may thereby be enhanced. If the effort is aimless or destructive, the money attached to it does not alter the result. [...]

[Communal credit usurped by banks]

 
   Book Economic Democracy, 1920, by Clifford H. Douglas, Part of Chapter 9, pp 120-121, Australian edition 1933 (orig. 1920)
   GREAT BRITAIN:  ... There is no doubt whatever that the first step towards dealing with the problem is the recognition of the fact that what is commonly called credit by the banker is administered by him primarily for the purpose of private profit, whereas it is most definitely communal property. In its essence it is the estimated value of the only real capital – it is the estimate of the potential capacity under a given set of conditions, including plant, etc., of a Society to do work. The banking system has been allowed to become the administrator of this credit and its financial derivative [p 121] with the result that the creative energy of mankind has been subjected to fetters which have no relation whatever to the real demands of existence, and the allocation of tasks has been placed in unsuitable hands.
   Now it cannot be too clearly emphasised that real credit is a measure of the reserve of energy belonging to a community and in consequence drafts on this reserve should be accounted for by a financial system which reflects that fact.
   If this be borne in mind, together with the conception of "Production" as a conversion, absorbing energy, it will be seen that the individual should receive something representing the diminution of the communal credit-capital in respect of each unit of converted material.

[Global Trade Competition Illusion]

 
   Book Economic Democracy, 1920, by Clifford H. Douglas, Part of Chapter 11, pp 144-47, Australian edition 1933 (orig. 1920)
   GREAT BRITAIN: [p 144] We have already seen that a feature of the industrial economic organisation at present is the illusion of international competition, arising out of the failure of internal effective demand as an instrument by means of which production is distributed.
   This failure involves the necessity of an increasing export of manufactured goods to undeveloped countries, and this forced export, which is common to all highly developed capitalistic States, has to be paid for almost entirely by the raw material of further exports.
   Now, it is fairly clear that under a system of centralised control of finance such as that we are now considering, this forced competitive export becomes impossible; while at the same time the share of product consumed inside the League becomes increasingly dependent on a frenzied acceleration of the process.
   [145] The increasing use of mechanical appliances, with its capitalisation of overhead charges into prices, renders the distribution of purchasing power, through the medium of wages in particular, more and more ineffective; and as a result individual discontent becomes daily a more formidable menace to the system.
   It must be evident therefore that an economic system involving forced extrusion of product from the community producing, as an integral component of the machinery for the distribution of purchasing power, is entirely incompatible with any effective League of Nations, because the logical and inevitable end of economic competition is war.
   Conversely, an effective League of Free Peoples postulates the abolition of the competitive basis of society, and by the installation of the co-operative commonwealth in its place makes of war not only a crime, but a blunder.
   Under such a modification of world policy, inter-change of commodities would take place with immeasurably greater freedom than at present, but on principles exactly opposite to those which now govern Trade. The manufacturing community now struggles for the privilege of converting raw material into manufactured goods for export to less developed countries. Non-competitive industry would largely leave the trading initiative to the supplier of raw material.
   Since any material received in payment of exported goods would find a distributed effective demand waiting for it, imports would tend to consist of a much larger proportion of ultimate products for immediate consumption than is now the case; thus forcing on the more primitive countries the necessity of exerting native initiative in the provision of distinctive production.
   Again, International legislation in regard to labour conditions under a competitive system must always fail at the point at which it ceases to be merely negative, because it has ultimately to consider employment as an agency of distribution, and rightly considered distribution should be a function of work accomplished, not of work in<--147 --> progress, i.e., employment.
   As a consequence, this most important field of constructive effort resolves itself into a battleground of opposing interests, both of which are merely concerned with an effort to get something for nothing.
   The inevitable compromise can be in no sense a settlement of such questions, any more than the succession of strikes for higher pay and shorter hours, which are based on exactly the same conception, can possibly result in themselves in a stable industrial equilibrium.

[Freedom to Co-operate through Decentralisation]

 
   Book Economic Democracy, 1920, by Clifford H. Douglas, Part of Chapter 12, pp 152-54, Australian edition 1933 (orig. 1920)
   GREAT BRITAIN: The policy suggested in the foregoing pages is essentially and consciously aimed at pointing the way, in so far as it is possible at this time, to a society based on the unfettered freedom of the individual to co-operate in a state of affairs in which community of interest and individual interest are merely different aspects of the same thing. It is believed that the material basis of such a society involves the administration of credit by a decentralised local authority; the placing of the control of process entirely in the hands of the organised producer (and this in the broadest sense of the evolution of goods and services) and the fixing of prices on the broad principles of use value, by the community as a whole operating by the most flexible representation possible. [...] Thus out of threatened chaos might the
Dawn break ; a Dawn which at the best
must show the ravages of storm,
but which holds clear for all
to see the promise of
a better Day.