"What were the factors when we set up our game of production and consumption?"
"Oh yes—and capital, and enterprise or management, and invention or technique, government came in there too, but I am not sure that it is a factor in production."
"It is, as you will see. Let's examine these factors and attempt to make a rough estimate of their importance. Work is basic, certainly. In any but the most Elysian of South Sea islands, man must work to live. Marx made the mistake of thinking that because it came first, it was the only factor worthy of consideration, even though his writings implied the existence of others. Enterprise is more important than work. Without enterprise, management, directive ability, and imagination, our present highly productive culture would be impossible. It is a form of creative work, more difficult than the imitative work of the laboring men, and absolutely necessary to a high rate of production. Capital or rather capitalization is essentially the willingness of the owner of accumulated wealth to risk it in the hope of acquiring more. Its return is interest. We don't think very highly of it anymore. Capital is plentiful and by direct competition through the Bank of the United States we have driven interest down to a point where the return is commensurate with the risk. Franklin Roosevelt taught us that lesson with the Reconstruction Finance Corporation and the Federal Housing Administration.
"I said that government is a factor. It is, if for no other reason than through its police powers it makes the environment safe to work in. Without it no one could accumulate wealth and the creation of wealth on a large scale would not be feasible. Which is another way of saying that individuals acquire wealth only at the sufferance of the community and the community may require any tribute necessary to promote the general welfare. The government performs many other useful services too numerous to mention, but you see my point.
"Land and raw materials are obvious factors in the production of wealth. In the simplest economy labor must have something to fabricate and some place to stand on in order to produce wealth.
"The last factor is invention or technique. I mean not only new inventions now held by patent, but also all useful accumulation of knowledge from the stone age to date. Although wealth can be created without, or with very little of it, it is the greatest factor of all. You need only consider any common article to be convinced of it. Take a pair of shoes. In a modern shoe factory the production is around six hundred pairs of shoes per man per day. By figuring in raw material and capital costs it drops only to about four hundred pairs per laborer per day. Does one man make four hundred shoes per day? Put him at a cobbler's bench and assume him to be an experienced cobbler, yet he will do well to turn out one pair. Is it management? Management is important, for a poor manager will reduce production by perhaps 50%, yet the factory still turns out enormously more than a number of hand cobblers equal to its employees could do. Obviously the factor which produces this enormous multiplication of wealth is technical knowledge, the contribution of the creative inventor and creative artist. That is why we reward them so highly today. There is one outstanding characteristic of the creator-discoverer. His work lives after him and is cumulative in its effect. We owe more to the unknown genius who invented the wheel and axle than we do to all the workers now on earth. Furthermore, inventors stand on the shoulders of all their predecessors. No modern invention would be possible without the work done by Bacon, Da Vinci, Watt, Faraday, Edison, et cetera without number."
"Yes, that is evident but what of it? I can't see that the work of those men justifies laziness today."
"These men are our forefathers. They have left to each one of us the most valuable inheritance possible, other than the good earth and life itself. To each one of us, mind you, lazy and industrious alike. To refuse your brother who prefers not to work his share in production for moralistic reasons of your own devising is to claim for yourself that which you have not earned and have no right to."
Perry looked baffled but unconvinced. "Granting that what you say is true—it is, I suppose—nevertheless it takes labor to apply this heritage of technical knowledge. Why shouldn't every able-bodied man have to contribute equally to that labor?"
"But surely, Perry, you can see that there is not enough drudgery in this world to go around. The machines have released us from the curse of Adam. How can all of us crowd into the control stations of the machines? We have short hours, naturally, and most machine tenders and such retire at an early age, but it isn't practical to change shifts every fifteen minutes nor to train new men every few weeks. Would you have men dig holes and fill them up again for the sake of work itself? Would you destroy the machines and restore the cobbler's bench? There is always creative work to be done; there is no limit to that, but there is no way to punch time clocks on it either. If a man has creation in his system, all we can do is to give him leisure in which to develop it. Tell me, have you seen very many idle people?"
"No, I haven't as yet."
"You won't. The urge to work exists in more than ninety per cent of the population. Free him from drudgery and he putters in the garden, in a workshop, learns to draw, tries to write poetry, studies, goes into politics, invents, sings, devises salad dressings, climbs mountains, explores the ocean depths, and tries to fly to the moon. Few are those who sit in the sun and whittle."
"Say, are they really trying to reach the moon?"
"Yes, surely. But I want to give you an illustration of the current situation. Suppose in your day seven men own a big car together and all wish to drive from San Francisco to New York. John is crippled and can't drive. Joe is too young to drive. Jack doesn't know how to drive. Jake is a good driver but hates to drive, being of a nervous temperament. Jep is just plain lazy and prefers to watch the scenery, but Jim and George are both good drivers and don't mind doing it. Of course only one person can drive at a time. You propose that they all take turns at the wheel, barring the cripple and the child. Isn't it more reasonable to pay the two drivers for their services and let everyone reach New York in comfort? That is what we do today. Those who perform the drudgery of the nation are paid—and well-paid—in addition to their dividend from their inheritance."
Perry threw up his arms in mock surrender. "Enough. Enough. Frankly, I'm not convinced yet, but you certainly can make out a case."
Davis shrugged his shoulders. "Personally I'm not interested in moralistic reasons. The present system is the one the American people have chosen to serve them at this period of their development. It suits my temperament so I don't try to change it. If you want another you now know how to devise another which will be economically feasible. Then you are free to try to persuade the country to adopt it. You might even try to persuade a state. Several of the states have modifications."
"So I gathered. How do they work?"
"Well, Wisconsin has very high income taxes and pays a state dividend in addition to the Federal dividend. They have a nearly complete socialism with most business run co-operatively. It seems to suit them but I find it a dull pace. However, let me mention the practical advantages of the blanket dividend as compared with your moralistic proposal. In the first place it ensures high wages, because men who are free from economic necessity won't work for sweatshop wages. For the same reason it ensures good working conditions. Unions are no longer necessary. Those that remain have turned into fraternal organizations rather than battalions in class warfare. In the second place it ensures social security for everybody all the time and thereby makes government much simpler. In your day the social service bureaucracy was growing by leaps and bounds. We don't need social service workers where poverty is unknown. And it saves private citizens from the insufferable buttinsky-ness of social work, the prying catechisms that determine the 'deserving' poor. If for no other reason the dividend is desirable because it ended the incredible red tape and indignities of your old system of relief, and welfare work, and private charity."