that which, in the Socialist's opinion, he gives.

(3) Socialism is not Paternalism, because Paternalism would sacrifice individuality, whereas Socialism seeks to give equal chances for individual development while enforcing upon each individual equal obligations to all other individuals.

Writing to a Parisian friend in the October of 1905, Herbert Spencer said:

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First, Socialism will, in the face of all opposition, eventually triumph. Second, its triumph will be the greatest misfortune in the history of the world. Third, it will, in a brief time or long, be ended by military despotism.

Whatever the worth of this prophecy-for even the most worthy philosophers are not necessarily among the worthy prophets it was clearly based upon a thorough understanding of the Socialistic theory of Socialism as a law of social evolution. When one has mastered that, one has mastered, in the rough, precisely what Socialism claims to be, and the best brief statement of that so-called law-it is known as the Materialistic Conception of History-was thus made by an ultra-conservative * Paris Figaro, December, 1905.

organ, the New York Nation, not many months ago:

Historical evolution is shaped, not by ideas, but by mechanical necessity. The moral ideals of society, its religious creeds, its political, legal and social institutions, are all the outgrowth of economic conditions. This may be sneered at as a glorified sovereignty of the stomach, but there are your facts. In the long result, it is the producers who shape and rule society, and history is the story of conflict between a class of producers who would retain their control over society after their usefulness is gone, and a new class of producers struggling to come into its own. But it is evident that democracy has put power into the hands of the great mass of the world's workers. Hence these masses are ultimately bound to change society so as to assure their own welfare and domination. Q. E. D."

How this theory is supported, how it is applied and what its believers think will be its ultimate effects, we shall now proceed at length to consider.

II

THE POINT OF DEPARTURE

"Labor was the first price, the original purchasemoney that was paid for all things."

-ADAM SMITH, The Wealth of Nations.

IN my endeavor to differentiate Socialism from the various theories with which it is most frequently confounded, it was necessary to emphasize the economic phase of the Socialistic propaganda. At first this emphasis may have seemed to be employed with undue insistence; but, surely, as the definitions unfolded, it must have become clear that, though the voters of America are about to be called upon to make the acquaintance of Socialism as a political movement, Socialism in its essence is really an economic movement expressing itself politically.

Now, most of us know that political economy is the dryest of studies-and that is about all that most of us know, or care to

know, concerning it. We have seen, moreover, that Socialistic political economy is generally habited in language peculiarly technical, and that it is thereby peculiarly awesome. But to come to a thorough understanding of this political issue which, supported by figures, two such differing seers as Herbert Spencer and Mark Hanna agreed must shortly confront mankind, it is obviously compulsory that we first understand the issue's economic essentials; and, frankly, the way to the acquittal of this task should be no more beset by terrifying technical titles than was the way, in the previous chapter, to an explanation of the terms "Class Struggle" and "Social Revolution "-should be, in fact, uninteresting only if you have no interest in your rent, your butcher's bill, or the price that you pay for the clothes on your back.

In the briefest summary compatible with clarity and that is the only sort of summary we shall attempt-these economic essentials are five in number:

(1) Capital.

(2) Use-Value.

(3) Exchange-Value.

(4) Labor.

(5) Profit.

(1) Capital

Capital, according to the political economists of Capitalism as opposed to those of Socialism, is the ownership of useful things, or at all events of the capabilities for use that are inherent in those things.

In his primitive state, man lived by the hunt. What he wanted for food he slew with the rude bow and arrow that he himself had made; what he needed to wear he secured from the skins of the animals he had thus slain, and what he required by way of shelter he tore from the trees or gathered from the rocks that filled his hunting-ground. For his existence in this condition, the implements of the hunt were therefore the sole necessities, were about the only useful manufactured articles, and ownership of these articles constituted the first Capital.

As society became more complex, as trade developed and as manufacturé grew, although the relations of mankind waxed infinitely more varied, Capital, though it changed in degree, did not, according to the Capitalistic economists, change in kind, has not changed, nor can ever change, its nature. Men now and always must eat, must be clothed against the cold and