employers have paid even a fraction of the increased wage out of their own pockets. More usually they put a fifth of a penny on commodities when the worker has secured a sixth. Competition alone restrains them, and this is largely superseded by agreements. We have had innumerable instances of this during the war. Class after class of workers claimed a higher wage, and prices rose higher and higher “on account of the increased cost of production.” If a Labour Government were to prevent employers from increasing the cost of commodities and raising rents in exact proportion to the demand for higher wages—were, in other words, to direct the employers to pay the increase of wage out of their own profits—we should soon see the end of this industrial order. The State would be compelled to become the employer.
This seems to be true of practically all the legislation which a political power of Labour could secure. Compensation, pensions, and insurance are typical instances. The new demand on the employer’s profits is met in one of two ways: he withdraws voluntary contributions to these or similar purposes, or he raises the price of his goods. The larger consumer meets the burden by raising his rents or fees. The unreflecting worker imagines that “the country” pays for these things; he forms, in this respect, a larger proportion of the country than he thinks.
The second and more important consideration is that this power to dictate wages and pass measures
