knowledge of the costs of production and of the amount of investment. To make information accurate, the government would have to prescribe the methods of accounting. It would be impossible to prescribe uniform methods as is done for the railroads. The bewildering variety of conditions in the different industries would have to be provided for. Detailed reports, based on these prescribed methods, would have to be made to the government, and these would have to be scrutinized and studied with the utmost care. The government would have to employ a vast corps of expert accountants, statisticians, and other specialists. The difficulties of cost accounting are so great that many of the large business concerns have found it impossible to ascertain the costs of their products on scientific principles. The business concern can get along without accurate knowledge of its own costs. The government, however, in fixing prices, must know all about cost, both operating costs and capital charges. They are the very things which primarily determine the reasonableness of prices.

In the third place, the determination of costs and investments for the purpose of fixing prices would involve immensely difficult problems of judgment. The judgment of the regulating body would be constantly challenged and the result would probably be endless litigation. The proper allowance for depreciation and obsolescence, the proper apportionment of overhead charges among different products and services, the proper methods of valuing the different elements in investment-these would have to be passed upon by the regulating authority. Such problems are difficult enough as they confront the Interstate Commerce Commission. They would be far more difficult for a body dealing with multifarious combinations in widely differing industries.

Even if the regulating authority should succeed in working out a satisfactory determination of costs of production and value of investment, it would still be beset with troubles in fixing prices or limiting profits. Demand for goods is variable even in non-competitive industries. Unchanging prices or prices bearing an unchanging relation to costs would not be practical in mining, manufacturing, and mercantile business. A combination might at times be justified in reducing prices below a normal level to stimulate demand and keep its force employed, or to meet foreign competition. The government would then have to determine how much prices could subsequently be advanced in order to offset these reductions. In other words, the government would be dealing with a constantly changing problem of demand. Particularly difficult would be the

fixing of proper prices for products produced at joint cost. Take petroleum for example. A wide variety of products are derived from the one raw material, crude oil. Some of these are in so little demand that they must be sold for less than the price of the crude oil itself. Others are in great demand and can be sold for high prices. It is impossible to use costs as a basis for determining prices of the specific products. For a regulating body to determine the proper relationships of the prices of these joint products is virtually impossible.

One could continue almost indefinitely setting forth the complexities and difficulties of government regulation of the prices and profits of combinations. A vague form of regulation will not do. It would be difficult to prove that the public would be any better off under a régime of half-regulated monopoly than under a régime of competition enforced as well as possible by laws against combinations and monopolies. Combination must be proved decidedly more efficient than competition before the people will be justified in trusting trusts under any but the most rigorous government control.

Government regulation of prices and profits always involves a large element of waste, of duplication of energy and cost. It means that two sets of persons are concerning themselves with the same work. The managers and employees of the corporation must study cost accounting and conditions of demand in determining price policy. The officers and employees of the government must follow and do it all over again. Moreover, the fact that the two sets of persons have different motives in approaching their work means friction and litigation, and these spell further expense. To superimpose a vast governmental machinery upon the vast machinery of private business is an extravagance which should be avoided if it is possible to do so.

The policy of government regulation of industry may readily become a stepping-stone to government ownership and socialism. The chances are strong that the government of the United States will take over the telegraphs and telephones in the near future and the railroads within less than a quarter of a century. If regulation by the government proves ineffective in securing reasonable rates, the general public will demand government ownership. If regulation proves so effective as to leave only moderate returns to the stockholders of the corporations, the stockholders are likely to urge government purchase, which would at least assure them a more certain income. In either case the excessive cost of government regulation will be urged as a reason for government ownership. In the

same way, if the government undertakes detailed regulation of combinations in manufacturing, mining, and trade, there is bound to be a strong movement for government ownership in these fields also.

Government ownership of this or that industry is not necessarily a bad thing. Even government ownership of a large proportion of the industries of the country, even complete socialism, need not necessarily affright us. It is sufficient to point out that the people ought not to enter on the path of permitting and regulating combinations without considering the advantages and disadvantages of this, the possible ultimate outcome, as well as those of the immediate policy itself. If it could be proved that combination is materially more economical than competition, we should doubtless be wise to say farewell to competition. Presumably in this case we ought to test thoroughly the practicability of government regulation of private monopoly before proceeding further. The people would naturally first try the plan of government ownership, if at all, in limited fields, and compare the results with those of regulated monopoly before undertaking general government ownership. It is by no means improbable that the ultimate outcome would be socialism. The future is very likely to see either a régime of general competition -with, of course, some special exceptions-or a régime of universal communism. Clearly, then, we should be very sure of our ground before we take the first step toward possible communism. We should convince ourselves beyond all doubt that competition is impossible; or that, if possible, it is less efficient than monopoly-not merely at certain times and in certain places, but generally and permanently-before we tolerate widespread combination in the field of business.

IX

THE PROBLEMS OF POPULATION

It is generally agreed to be desirable to use our powers of social control to eliminate, or greatly reduce, the grosser social evils, such as misery, poverty, vice, and crime. Perhaps the great majority of us would go farther, and use such powers in quite a positive way to make society conform more closely to our ideals. But we differ, as "reformers" have always done, as to methods. In general we belong to two schools, the one stressing control of "environment," the other control of "population." The former demands greater equality in the distribution of income, a bettering of living and working conditions, a state relief of the stress due to "economic insecurity," and like measures. The latter, variously insists upon the reduction of numbers through "control of births," the restriction of immigration, and a "scientific breeding" of a "superior race" from the "eugenically fit." Some of the latter school emphasize quantitative, others qualitative, control of numbers.

The quantitative question has been much the more clearly appreciated. From the blessing "of the seed of Abraham" to England's recent imperative demand for "war brides," militaristic thought has always associated national greatness with a large population. A country in the stage of increasing returns places a high value upon sheer quantity of people, invites large families through its social conventions, and encourages its cities to boast of their numbers. It is only the presence or the anticipation of diminishing returns that causes a nation to see truth in the Malthusian spector of pressure of population upon the means of subsistence.

Half unconsciously, half deliberately, we of the United States have tried to realize our "national destiny" by exercising control over our numbers. But our problem has not until recently involved restriction of population. The movement for "smaller families and better" is one of a few decades, and it has affected only the more settled stocks. It cannot be said to have exercised as yet any general influence in restricting numbers. Our policy has been, on the contrary, one of increasing our population with mechanical rapidity, by supplementing a high, but falling, birth-rate with an extremely high rate of increase through immigration. By maintaining an "open door" we have allowed the population of the Western world slowly to adapt itself to natural resources considerably augmented by the addition of America. In the process of restoring an equilibrium throughout America and Europe as a single social entity, population has flowed to the regions where it has the highest value. The passing of the "old" and the coming of the "new" immigration shows that the leveling process in the Western world is well under way, and that Southeastern Europe is being brought within the common scheme of values. If immigration be left unrestricted, the "problem" will eventually disappear; but it will disappear because movement will no longer pay. This will come about when the lower level of material culture becomes dominant for the entity.

We have increased our population by immigration because we have needed numbers. Our vast natural resources have demanded for their development vast quantities of cheap labor. A continuous immigrant stream has supplied an increasing demand. The result has been the rapid development of a vast pecuniary system, in which the older stocks have generally been pushed up into positions of greater responsibility and higher wages. Our standards of living have been further advanced by the myriads of cheap

goods which immigrant labor has enabled our mills and mines to turn out. But, like protection, the results of immigration have not been and could not have been, limited to the purely industrial results which were anticipated. Immigration, in connection with such complementary "forces" as protection, the rapid accumulation of capital, the swift adaptation of the machine technique to a new continent, has contributed to the general transformation of American society which has come about in the last fifty years. It has played its part in the overdevelopment of our natural resources, the rapid growth of our mining and manufacturing, the extension of our pecuniary system, the evolution of our urban culture, and the institutions, attitudes, and problems which have been incident to this. Its rôle in the production of our "prosperity" has been by no means a negligible one. Its social effects are very closely bound up with the tariff. By accelerating the rate of our development and by tying up larger and larger proportions of our resources in industries supplying capricious wants, it has intensified the rhythm of the business cycle. By blessing the country with an endless stream of "green" labor, it has seriously weakened the bargaining position of native laborers, has retarded the development of group solidarity, and has slackened the rate of improvement of factory conditions. It has caused our national life to remain "in a state of perpetual transition," and inhibited the formulation of the standards which a stable society must possess. Through the very plasticity of the immigrant it has preserved too much of the older institutional system, despite the sweeping transformation of our social life. To this end it has strengthened the hold of the older individualism; it has increased the inequalities in wealth; it has rendered the strategic position of property stronger; it has added huge increments of illiteracy to the body of citizens; it has delayed our achievement of social unity.

Not content with complicating all our social problems and adding a quota of new ones, it has presented us a perplexing and baffling immigration problem. In the past we have solved this in the formula, "Whosoever will, let him come." Our futile attempts at restriction have involved the contradiction of making use of a qualitative test, that of literacy, to solve a problem which we have conceived of only in quantitative terms. But, if we are to control our growth, we must formulate a more elaborate policy. In that task we must ask ourselves some very pertinent questions. What place is the immigrant to have in the future American society? Is he ultimately to become one of us, or is he to constitute a permanent proletariat in a class society? How many immigrants can we use? What are we to use them for? What policy will result in securing the right number, of the right kinds, and in the right proportions? Have we elaborated machinery for making the immigrants the kinds of people we want them to be? Can such machinery be elaborated? What influences is the newcomer exerting, or destined to exert, upon our ideals, our standards, our institutions, and our programs? And what in the less immediate future is going to be the good of it all?

As we as a nation become older, our problems little by little lose their gigantic and crude character. Our solutions must accordingly become more delicate and exact. With this change in our national life we are beginning to give more attention to the qualitative side of the population problem. As yet we have aimed only at "negative" results. We have tried to prevent the marriage and breeding of the "unfit," such as the insane, the feeble-minded, and those possessed of chronic and hereditary (?) diseases. We have made some attempt to prevent the marriages of those of radically different stocks, such as whites and blacks. But we have as yet formulated no positive program aimed at a definite result. We have, with trifling exceptions, allowed men of any race to come and sojourn with us. To prevent their becoming contributors to a future American race we have depended only upon such social restraints as inhere in racial antipathy and in the difference in social and economic positions between members of different stocks. A permanent control of the quality of population involves both the immigration and the