find the anomaly of liberty loan speakers urging the most rigid economy on the part of all classes with the double purpose in view of obtaining heavy subscriptions to the loan and of reducing the demand for, and hence the production of, non-essentials, and the priorities committees and the War Industries Board in Washington making plans for the curtailment of non-essential production, while manufacturers and merchants everywhere are working directly against the government by elaborate and skillful advertising of nonessential commodities. Liberty loan booths are surrounded by tempting displays of luxuries designed to lure unsophisticated women to purchase commodities with which they could perfectly well dispense."

ESSENTIAL AND NON-ESSENTIAL INDUSTRIES

There is a disposition in many quarters to look upon those who stand for business as usual as deliberate enemies of the cause or at least as persons who put their own private interests above those of the government. Much study of current arguments on this subject and much discussion with individuals directly involved, in the nonessential industries have convinced me that there is relatively little of this deliberate selfishness in the situation; it is mainly misunderstanding. Of course it is human nature to hope against hope that one's own particular occupation may not have to be foregone; and the wish is usually father to the thought that such occupation is really essential. This leads at times to most amusing discussions of what is and what is not essential. For instance, a manufacturer

Examples of deceptive advertisements might be cited by the hundreds. Some of them almost overtax human credulity.

There has moreover been a strange hesitancy on the part of the governmental agencies to face squarely the defining of non-essential commodities. Merely because there are difficulties involved does not mean that there is not a large list of commodities which may be set down as non-essential for war purposes. The problem that the government has to decide is, however, after all, not as between essential and non-essential, but as between more essential and less essential; and when full priority is given to the more essential commodities, the less essential ones are eliminated, thus proving that they are in fact non-essential. It is interesting that at the very time when governmental agencies refuse to decide what is non-essential they expect the rank and file of uninformed consumers to exercise discrimination in purchasing, to the end that capital may be diverted from nonessential lines. Fortunately, every time a priority decision is made the government does have to distinguish between more and less essential commodities.

of cosmetics stoutly insists that the proof that his industry is a necessity is found in the fact that women will forego food in order to buy face powder. It is also widely believed that there is sufficient productive power in the country to take care of the normal production and war production in addition. Even so recently as April, 1918, at a big salesmen's conference in Detroit, only three people could be found who would admit that there was not enough productive energy in the country to supply both the needs of business and war.

The newspapers have been the subject of no little discussion in this connection. It is urged that at the very time that they are preaching sacrifice and the loftiest ideals of patriotism in the editorial columns, they run advertisements which urge the purchase of all sorts of non-essential commodities, advertisements which are in many cases so palpably in opposition to national policy-such as long woolen socks for men in civilian occupation,-that no one could plead as an excuse, ignorance of the results of such advertising; and they refuse to print articles or advertisements which preach the doctrine of economy." We should not belabor the newspapers too strongly for these practices. The newspapers after all belong to the class of essential industries; they merely are unfortunate in being financially dependent upon the advertisements of those engaged in non-essential industries. Refusal of non-essential advertisements means for them financial bankruptcy and hence inability to render service which is of paramount importance to the government.

METHODS OF EFFECTING INDUSTRIAL REORGANIZATION Although the need for industrial reorganization has now been clearly established in the minds of the governmental agencies, the question of methods of securing such diversion of energy is still a debatable one. There are three methods, not mutually exclusive, of securing diversion from non-essential industry to war production. The first may be called the saving method, the second, the priorities method and the third, industrial conscription, or selective recruiting of manufacturing establishments.

"I know of one metropolitan newspaper company that recently paid five hundred dollars in damages for failing to insert, after a contract had been drawn for such insertion, an advertisement containing only official statements on the need of economizing.

Those who urge saving as the method by which the diversion should be accomplished usually fail to realize that such a method is both slow and unscientific. It is slow because it is indirect; it will gradually succeed in forcing business establishments in non-essential lines into bankruptcy, but it does nothing toward pointing the way for such establishments into war industry. It is unscientific in that it does not involve any exercise of selection in the particular types of non-essentials which can best be dispensed with and of the particular establishments in any given line of industry which can be dispensed with most easily and which at the same time can be most readily adapted to war production. The saving method forces out first the marginal business man and it is probable that this business man will not be the one who could most quickly adapt his establishment to the manufacture of war supplies; in fact, it would more likely be the case that the very lack of enterprise, organizing ability, vision, what not, which caused him to be a marginal producer will result in his floundering about for an indefinite period; and this is of course accompanied by much unemployment and social unrest. Under such circumstances the process of saving, that was merely begun when this manufacturer was forced out, finds fruition only indirectly, in the creation of new industrial establishments by other business men-new industrial establishments which require much time in the building and which involve heavy initial cost in the way of labor and materials;-establishments, moreover, which can be of little, if any, use after the war is over. The priorities method is superior to the savings method in that it may select for discontinuance first those lines of industry which are least essential and those particular establishments in any given line which may most quickly be converted to war production.

The third method, that of conscription, or selective recruiting, merely involves carrying the second method a step further and having the government take the initiative in determining what establishments in any given line should be devoted to the production of particular war supplies. It not only quickly reduces the production of non-essentials, but it adapts those establishments with a minimum of loss to the owners or of unemployment for the workers to the creation of war supplies for which they are best suited. At the same time it enables the war supplies to be produced with a minimum of additional capital goods, thus saving the enormous costs involved in

new construction itself, as well as the waste entailed when the conclusion of peace destroys the demand for war products. This method of converting selected plants has thus the combined advantage of speed, economy of labor and materials during the war, and the minimizing of difficulties during reconstruction. Selective industrial recruiting and the application of priority rulings are now being rapidly perfected and it is probable that the major portion of the industrial readjusting in the coming year will be accomplished in these ways rather than by the indirect method of individual retrenchment of consumption.

It is interesting that we should have been so timid in this country, particularly in view of the success of the introduction of the selective draft, in adopting a policy of industrial conscription or recruiting. The suggestion of industrial conscription appears to have been strongly opposed owing to the fact that the term early applied to both labor and capital. Indeed, many who use the term apply it to labor alone. Now "conscription of labor" meets with overwhelming opposition on the part of the labor organizations of the country. But although labor objects to being conscripted into private industries that are earning war profits, it would not seriously oppose conscription into government industries. It is possible, moreover, that if conscription had been applied months. ago to capital, that is to factories and workshops of every description, the labor organizations would not now so seriously object to compulsory change of employment. And it should be recognized, also, that if factories are first conscripted, conscription of labor would hardly be necessary. Labor will not long hesitate, with erstwhile employment in non-essential industry gone because of closed factory doors, in accepting remunerative jobs in beckoning war industries. With effective labor exchanges and adequate housing facilities in the seats of war industry, voluntary enlistment of labor in the industrial army may be considered as a foregone conclusion.

We have spoken of closed factory doors; but it must be borne in mind that a selective recruiting of factories for war occupations does not mean the closing of factory doors in most instances. It means an adaptation of that factory to war manufacture, thus giving continued employment to its laborers; only a minimum of labor shifting is thus required. Selective recruiting of the factories for war service meets with virtually no opposition. The evidence is

overwhelming that business concerns are eager to respond; they need merely be shown in what ways they may be of service and guaranteed minimum returns for their efforts. A selective recruiting of this sort does not imply commandeering of private wealth; it is not un-American. It means merely that the government gives to certain business men the opportunity and the honor of rendering service in the common cause of humanity. American business men are every day demonstrating their willingness to sacrifice present lines of business provided they are given prompt opportunity to render service to the country. It is time that we generally recognize that this country does not shirk responsibility. It is time that we cease hesitating to disturb normal pursuits by governmental action; for they will shortly be more seriously disturbed by the unorganized and undirected economizing of the consuming public. Fortunately in the reorganized War Industries Board, machinery is now being rapidly developed for accomplishing by intelligent social direction what would in any case eventually be accomplished by unintelligent, undirected and time-consuming individual retrenchment.

STIMULATING LABOR EFFICIENCY IN WAR TIMES BY RICHARD A. FEISS,

Chief of the Manufacturing Branch, Quartermaster Department.

To face the situation involved in the problem under discussion we must have hope, but unfortunately, I fear we have a tremendous lot of unpreparedness. Seriously speaking and quoting one of my friends, who I believe is as close to the heart of the industrial situation in America as anyone, "We are facing within the next three to six months what is likely to be a crisis that means win or lose-not at the front, but here at home in the industrial world." That situation is arising from the lack of appreciation of what has gone before and from the want of any appreciation of the fact that every element, including above all that element known as the labor question or the industrial question, is the very essence of the mobilization of those forces necessary to win the war.

To solve these problems it seems to me they must be approached from two specific directions, and I will try to touch upon some of the