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Professor Flint argues that the "law of over-production," and the consequent struggle for existence, being "the reason why the world is so wonderfully rich in the most varied forms of life," is "a means to an end worthy of Divine Wisdom." "Although involving privation, pain, and conflict, its final result is order and beauty. All the perfections of sentient creatures are represented as due to it.
If we ever do arrive at a state when all the desires are fully satisfied when there is over-production in all industries we shall have general reduction in the hours of labour: "efficiency" will take that form. The wealth of England is the sum of the wealth of each individual in England. An individual may have L10,000 in England, L5000 invested in Australia.
Then, like manufacturers of a higher grade, he may mistake the public wants, and the articles he has made may remain unsaleable on his hands, or he may fall into the error of over-production like a Manchester house.
Competition and over-production led naturally to a fall in prices, and at the same time the demand decreased, because the railway-building activity of the Government slackened. Alarmed at this state of things, the banks which had helped to start and foster the huge and costly enterprises contracted their credits. By the end of 1899 the disenchantment was general and widespread.
While coffee cannot be cultivated successfully much higher than four thousand feet above sea level in this island, tea thrives at almost any height in this latitude, as it does in northern India, round about Darjeeling. The only fear seems now to be that of over-production.
Questions of over-production of food products, rise or fall in the price of exchange, panic in the money market, or an adverse balance of trade, disturbed them not.
More than enough, for in consequence of what they call "Over-Production", the markets are periodically glutted with commodities of all kinds, and then for a time the factories are closed and production ceases. And yet we can all manage to exist after a fashion.
Unfortunately the theory of markets, like that of emigration with which they attempted to meet Malthus, is a begging of the question. The States having the largest market are as subject to over-production as the most isolated countries: where are high and low prices better known than in the stock-exchanges of Paris and London?
To-day we are paying for the folly of the over-production and its consequences in permanent injury to plastic childhood of yesterday. To-morrow, we shall be forced to pay for our ruthless disregard of our surplus children of to-day. The child-laborer of one or two decades ago has become the shifting laborer of to-day, stunted, underfed, illiterate, unskilled, unorganized and unorganizable.
Is there a single economist, academician, or candidate for academical honours, who has not supported arguments, proving that economic crises are due to over-production that at a given moment more cotton, more cloth, more watches are produced than are needed!
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