from entering into direct intercourse with foreign buyers.
When one examines with more than a superficial attention the life of the small industries and their struggles for life, one sees that when they perish, they perish — not because “an economy can be realised by using a hundred horsepower motor, instead of a hundred small motors” — this inconveniency never fails to be mentioned, although it is easily obviated in Sheffield, in Paris, and many other places by hiring workshops with wheel-power, supplied by a central machine, and, still more, as was so truly observed by Prof. W. Unwin, by the electric transmission of power. They do not perish because a substantial economy can be realised in the factory production — in many more cases than is usually supposed, the fact is even the reverse — but because the capitalist who establishes a factory emancipates himself from the wholesale and retail dealers in raw materials; and especially, because he emancipates himself from the buyers of his produce and can deal directly with the wholesale buyer and exporter; or else he concentrates in one concern the different stages of fabrication of a given produce. The pages which Schulze-Gäwernitz gave to the organisation of the cotton industry in England, and to the difficulties which the German cotton-mill owners had to contend with, so long as they were dependent — upon Liverpool for raw cotton, are most instructive in this direction. And what characterises the cotton trade prevails in all other industries as well.
If the Sheffield cutlers who now work in their tiny workshops, in one of the above mentioned buildings supplied with wheel-power, were incorporated in one big factory, the chief advantage which would be realised in the factory would not be an economy in the costs of production, in comparison to the quality of the produce; with a shareholders’ company the costs might even increase. And yet the profits (including wages) probably would be greater than the aggregate earnings of the workers, in consequence of the reduced costs of purchase of iron and coal, and the facilities for