Page:Popular Science Monthly Volume 42.djvu/111

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ARE BUSINESS PROFITS TOO LARGE?

naturally asks why it should not be as well rewarded. The answer always must be that it should, but this does not answer the main question as to the proper proportion of profits to be divided. Three things being essential, and each able to command pay, the portion of pay must be governed by circumstances. In the case of our village boys, one only can start in business, and nine start as laborers, so that there are in the beginning nine competitors for the rewards of labor, and but one for the rewards of both capital and skill in management. On the law of competition, which can not be evaded in the long run, this seems to put labor at a great disadvantage, but it is a disadvantage imposed by Nature, and so need not be discussed. The actual fact is, that there are three things equally essential and to be paid for the conduct of business. If we had thirty dollars to divide as the result of an enterprise, and should say that, as all three of the things were essential, each of them must have a third of the emolument, we would shoot wide of the mark. In that case, one individual would get twenty dollars, and nine would get only one dollar and eleven cents apiece. That would be absurd. But the poor man, looking to the owner of a hundred millions, imagines that the division has been something very much like it.

The poor man, however, is mistaken. There is no business of recognized legitimacy that pays labor only a third. There is no business that gives to capital and skill combined even ten dollars out of thirty. Labor gets more than two thirds of the income of most undertakings, and of many gets the whole, while the entire capital not only obtains nothing, but is itself lost in the venture, and its owner relegated to the ranks of labor. No man, employing ten hands at wages of three dollars per day each, expects to make five dollars per day; but that sum would only give him three dollars for his time—the same as his men get—and two dollars for his skill and the use of his capital. This is a case where the employer is possessed of ability to manage the ten men as laborers only, and for such a man five dollars per day for the necessary study, anxiety, and responsibility, can not be deemed out of proportion.

When the man of fifty looks at his boy associates and their careers, probably he will find that only one in ten has reached a handsome competence by his own exertions, and that one because he was energetic, faithful, competent, and thorough systematically from the start. If for a time he served under another, he was careful to do a little more than was expected of him, and did it well. This created confidence and desire on the part of his employer to see him prosper, and a disposition to assist him. In course of time his employer lends him capital, or makes him a partner in the business, and then his fortune is assured. Why