232

POLITICAL  ECONOMY

demand  increasing  than  they  would  have  done
otherwise.  It  is  quite  possible  that  the  gain
of  the  working  classes  through  the  resistance
offered  to  social  friction  by  trade  union
action  may  have  been  an  amount  well  worth
having.  But  could  an  all-round  combination
of  labour  raise  wages  on  the  assumption
that  there  was  previously  no  social  friction,
or,  in  other  words,  could  trade  union  action
do  more  (in  the  absence  of  any  increase  of
efficiency  on  the  part  of  labour)  than  counteract ­
  social  friction  ?
To  find  the  correct  answer  to  this  question
requires  more  than  a  passing  acquaintance
with  economic  principles.  We  may  argue  the
matter  in  this  way.  Wage  earners,  were  they
strong  enough  to  hold  out,  and  were  they  in  a
position  to  sell  their  labour  in  the  lump,  could
immediately  secure  an  appreciably  higher  wage.
The  higher  wage  would  be  won  at  the  expense
of  employers’  earnings  and  interest  on  industrial ­
  capital.  Consequently,  in  the  long
run  the  amount  of  employing  capacity
devoted  to  industry  would  probably  be
reduced,  and  so  also  would  the  amount  of
capital  devoted  to  industry.  Now  when
industrial  capital  and  the  quantity  of  the
employing  factor  acting  in  production  were
both  diminished  the  sum  of  the  national