Where Half The World Is Waking Up Part 3

DOES j.a.pANESE COMPEt.i.tION MENACE THE WHITE MAN'S TRADE?

I

With all the markets of the Orient right at j.a.pan's doors and labor to be had for a mere song--four fifths of her cotton-factory workers, girls and women averaging 13-1/2 cents a day, and the male labor averaging only 22 cents--it is simply useless for Europe and America to attempt to compete with her in any line she chooses to monopolize.

Now that she has recovered from her wars, she will doubtless forge to the front as dramatically as an industrial power as she has already done as a military and maritime power, while other nations, helpless in compet.i.tion, must simply surrender to the Mikado-land the lion's share of Asiatic trade--the richest prize of twentieth-century commerce.

In some such strain as this prophets of evil among English and American manufacturers have talked for several years. For the last few months, professing to see in j.a.pan's adoption of a high protective tariff partial confirmation of their predictions, they have a.s.sumed added authority. Their arguments, too, are so plausible and the facts as to j.a.pan's low wage scale so patent that the world has become acutely interested in the matter. I account myself especially fortunate, therefore, in having been able to spend several weeks under peculiarly favorable circ.u.mstances in a first-hand study of j.a.panese industrial {35} conditions. I have been in great factories and business offices; I have talked with both j.a.panese and foreign manufacturers who employ laborers by the thousand; I have had the views of the most distinguished financial leaders of the empire as well as of the great captains of industry; I have talked with several men who have served in the Emperor's cabinet, including one who has stood next to the Mikado himself in power; and at the same time I have taken pains to get the views of English and American consular officials, commercial attaches and travelers, and of newspaper men both foreign and native.

And yet after having seen the big factories and the little factory-workers in Tokyo and Osaka, after having listened to the most ambitious of j.a.pan's industrial leaders, I shall leave the country convinced of the folly of the talk that white labor cannot compete with j.a.panese labor. I believe indeed that the outlook is encouraging for manufacturing in the Mikado's empire, but I do not believe that this development is to be regarded as a menace to English or American industry. Any view to the contrary, it seems to me, must be based upon a radical misconception of conditions as they are.

In the very outset, the a.s.sumed parallel between j.a.pan's rise as a military power and her predicted rise as an industrial power should be branded as the groundless non sequitur that it is. "All our present has its roots in the past," as my first j.a.panese acquaintance said to me, and we ignore fundamental facts when we forget that for centuries unnumbered j.a.pan existed for the soldier, as the rosebush for the blossom. The man of martial courage was the goal of all her striving, the end of all her travail. Society was a military aristocracy, the Samurai the privileged cla.s.s. And at the same time commerce was despised as dishonorable and industry merely tolerated as a necessary evil. In the j.a.pan of Yalu, Liao-yang, and Mukden we have no modern Minerva springing full-armed from the head of Jove, but rather an unrecognized Ulysses {36} of ancient skill surprising onlookers merely ignorant of the long record of his prowess. Viewed from the same historical standpoint, however, industrial j.a.pan is a mere learner, unskilled, with the long and weary price of victory yet to pay.

In the race she has to run, moreover, the Mikado-land has no such advantages as many of our people have been led to believe. In America it has long been my conviction that cheap labor is never cheap; that so-called "cheap labor" is a curse to any community--not because it is cheap but because it is inefficient. The so-called cheap negro labor in the South, for example, I have come to regard as perhaps the dearest on the continent. Here in j.a.pan, however, I was quite prepared to find that this theory would not hold good. By reason of conditions in a primitive stage of industrial organization, I thought that I might find cheap labor with all the advantages, in so far as there are any, and few of the disadvantages, encountered elsewhere. But it is not so. An American factory owner in Osaka, summing up his Job's trials with raw j.a.panese labor, used exactly my own phrase in a newspaper article a few days ago, "Cheap labor is never cheap." And all my investigations have convinced me that the remark is as applicable in j.a.pan as it is in America or England.

The per capita wages of j.a.panese laborers here are, of course, amazingly low. The latest 1910 statistics, as furnished by the Department of Finance, indicate a daily wage (American money) of 40 cents for carpenters, 31-1/2 cents for shoemakers, 34 cents for blacksmiths, 25-1/2 cents for compositors, 19-1/2 cents for male farm laborers, and 22 cents for male weavers, and 12 cents for female. In the cotton factories I visited, those of the better sort, the wages run from 5 cents a day for the youngest children to 25 cents a day for good women workers. In a mousselaine mill I was told that the average wages were 22-1/2 cents, ranging from 10 cents to a maximum of 50 cents for the most skilled employees. And this, be it remembered, was {37} for eleven hours' work and in a factory requiring a higher grade of efficiency than the average.

But in spite of the fact that such figures as these were well known to him, it was my host in the first j.a.panese house to which I was invited--one of the Emperor's privy councillors, and a man of much travel and culture who had studied commercial conditions at home and abroad rather profoundly--who expressed the conclusion that j.a.panese factory labor when reduced to terms of efficiency is not greatly cheaper than European, an opinion which has since grown rather trite in view of the number of times that I have heard it. "In the old handicrafts and family industries to which our people have been accustomed," my host declared, "we can beat the world, but the moment we turn to modern industrial machinery on a large scale the newness of our endeavor tells against us in a hundred hindering ways. Numbers of times I have sought to work out some industrial policy which had succeeded, and could not but have succeeded, in England, Germany, or America, only to meet general failure here because of the unconsidered elements of a different environment, a totally different stage of industrial evolution. Warriors from the beginning and with a record for continuous government unsurpa.s.sed by any European country, our political and military achievements are but the fruitage of our long history, but in industry we must simply wait through patient generations to reach the stage represented by the Englishman, Irishman, or German, who takes to machinery as if by instinct."

All my investigations since have confirmed the philosophy of this distinguished j.a.panese whose name, if I should mention it, would be familiar to many in America and England. In the Tokyo branch of the Kanegafuchi Spinning Company (a company which controls 300,000 spindles) the director, speaking from the experience of one of the greatest and best conducted industries in j.a.pan, declared: "Your skilled factory laborers in America or England will work four sides of a ring frame; our unskilled laborer may work only one." A young Englishman in another factory declared: "It takes five men here to do work that I and my mate would take care of at home." An American vice-consul told me that it takes three or four times as much j.a.panese as foreign labor to look after an equal number of looms. A j.a.panese expert just back from Europe declared recently that "Lancashire labor is more expensive than ours, but really cheaper." Similarly the Tokyo correspondent of the London _Times_ summing up an eight-column review of j.a.panese industry, observed: "If we go to the bottom of the question and consider what is being paid as wages and what is being obtained as the product of labor in j.a.pan, we may find that j.a.panese labor is not cheaper than in other countries."

{38}

II

My own conviction is that in actual output the j.a.panese labor is somewhat cheaper than American or European labor, but not greatly so, and that even this margin of excess in comparative cheapness represents mainly a blood-tax on the lives and energies of the j.a.panese people, the result of having no legislation to restrain the ruinous overwork of women and little children--a grievous debt which the nation must pay at the expense of its own stamina and which the manufacturers must also pay in part through the failure to develop experienced and able-bodied laborers. The latest "j.a.pan Year Book"

expresses the view that "in per capita output two or three skilled j.a.panese workers correspond to one foreign," but under present conditions the difficulty here is to find the skilled workers at all.

When Mr. Oka, of the Department of Commerce and Agriculture, told me that the average j.a.panese factory hand remains in the business less than two years, I was astonished, but inquiry from original sources confirmed the view. With the best system of welfare work in the empire, the Kanegafuchi Company keeps its laborers two and a half {39} to three years, but in a mill in Osaka of the better sort, employing 2500 hands, I was told that only 20 per cent, had been at work as long as three years. Under such conditions, the majority of the operatives at any time must be in a stage of deplorable inexperience, and it is no wonder that the "Year Book" just quoted goes on to confess that "one serious defect of the production is lack of uniformity in quality--attributed to unskilled labor and overwork of machinery."

The explanation of this situation, of course, is largely to be found in the fact that j.a.panese industries are women's industries--there being seven times as large a proportion of women to men, the Department of Commerce informs me, as in European and American manufacturing. These women workers are mostly from the country. Their purpose is only to work two or three years before getting married, and thousands of them, called home to marry the husbands their parents have selected, or else giving way physically under strain, quit work before their contracts expire. "We have almost no factory laborers who look on the work as a life business," was an expression often repeated to me.

Not only in the mills, but in numerous other lines of work, have I seen ill.u.s.trations of the primitive stage of j.a.pan's industrial efficiency. As a concrete ill.u.s.tration I wish I might pa.s.s to each reader the box of Kobe-made matches on the table before me (for match-making of this sort is an important industry here, as well as the sort conducted through matrimonial middlemen without waiting for the aid or consent of either of the parties involved). I have never in my life seen such a box of matches in America. Not in a hundred boxes at home would you find so many splinters without heads, so many defective matches. And in turning out the boxes themselves, I am told that it takes five or six hands to equal the product of one skilled foreign laborer. "It takes two or three j.a.panese servants to do the work of one white servant" is the general verdict of housekeepers, while it has also been brought to my {40} attention that in shops two or three clerks are required to do the work of one at home. A j.a.panese newspaper man (his paper is printed in English) tells me that linotype compositors set only half as many ems per hour as in America. In short, the general verdict as I have found it is indicated by what I have written, and the most enthusiastic advocate of j.a.panese cheap labor, the captain of the steamer on which I came from America, rather spoiled his enthusiasm for getting his ship coaled at Nagasaki for 7-1/2 cents a ton, by acknowledging that if it rained he should have to keep his ship waiting a day to get sufficient hands.

Moreover, while the j.a.panese factory workers are forced into longer hours than labor anywhere else--eleven hours at night this week, eleven hours in the day next week--I am convinced that the people as a whole are more than ordinarily averse to steady, hard, uninterrupted toil. "We have a streak of the Malay in us," as a j.a.panese professor said to me, "and we like to idle now and then. The truth is our people are not workers; they are artists, and artists must not be hurried."

Certainly in the hurried production of the factory the j.a.panese artistic taste seems to break down almost beyond redemption, and the people seem unable to carry their habits of neatness and carefulness into the new environment of European machinery. "Take the Tokyo street cars," said an ex-cabinet officer to me; "the wheels are seldom or never cleaned or oiled, and are half eaten by rust." The railroads are but poorly kept up; the telephones exhaust your patience; while in the case of telegraphing, your exasperation is likely to lose itself in amazed amus.e.m.e.nt. A few days ago, for example, I sent a telegram from Osaka to Kobe, took my rickshaw across town, waited for a slow train to start, and then reached Kobe and the street destination of my message before it did.

In considering the failure of j.a.panese labor to bring forth a satisfactory output, however, one thing more should be said, and that is that we should not put the blame wholly on the {41} wage-earner.

Not a small proportion of the responsibility lies at the door of inexpert managers. The family system of production has not only been the rule for generations with that minority of the people not engaged in farming, but it is still the dominant type of j.a.panese industry, and it will take time even to provide opportunities for training a sufficient corps of superintendents in the larger lines of production.

In further ill.u.s.tration of my argument that cheap labor is not proving so abnormally profitable, I may question whether j.a.panese factories have paid as good dividends, in proportion to prevailing rates of interest on money, as factories in England and America. Baron Shibusawa, the dean of j.a.panese financiers and one of the pioneers in cotton manufacturing, is my authority for the statement that 12 per cent, would be a rather high estimate of the average rate of dividend, while figures furnished by the Department of Finance show that for ten years the average rate of interest on loans has been 11.25 per cent.

The fact that Western ideas as to j.a.pan's recent industrial advance have been greatly exaggerated may also be demonstrated just here.

While the latest government figures show that in twelve years the number of female factory operatives increased from 261,218 to 400,925 and male factory operatives from 173,614 to 248,251, it is plain that a manufacturing population of 649,000 in a country of 50,000,000 souls is small, and the actual progress has not been so great as the relative figures would indicate. Moreover, many so-called "factories"

employ less than ten persons and would not be called factories at all in England or America. The absence of iron deposits is a great handicap, the one steel foundry being operated by the government at a heavy loss, and in cotton manufacturing, where "cheap labor" is supposed to be most advantageous, no very remarkable advance has been made in the last decade. From 1899 to 1909 English manufacturers so increased their trade that in the latter year they imported $222 worth of raw {42} cotton for every $100 worth imported ten years before, while j.a.pan in 1909 imported only $177 worth for each $100 worth a decade previous--though of course she made this cotton into higher grade products.

III

It must also be remembered that the wages of labor in j.a.pan are steadily increasing and will continue to increase. More significant than the fact of the low cost per day, to which I have already given attention, is the fact that these wages represent an average increase per trade of 40 per cent, above the wages eight years previous. The new 1910 "Financial and Economic Annual" shows the rate of wages of forty-six cla.s.ses of labor for a period of eight years. For not one line of labor is a decrease of wages shown, and for only two an increase of less than 30 per cent.; sixteen show increases between 30 and 40 per cent., seventeen between 40 and 50 per cent., eight from 50 to 60 per cent., three from 60 to 70 per cent., while significantly enough the greatest increase, 81 per cent., is for female servants, a fact largely due to factory compet.i.tion. In Osaka the British vice-consul gave me the figures for the latest three-year period for which figures have been published, indicating in these thirty-six months a 30 per cent. gain in the wages of men in the factories and a 25 per cent, gain in the wages of women.

Of no small significance in any study of j.a.panese industry must also be the fact that there are in j.a.pan proper a full half million fewer women than men (1910 figures: men, 25,639,581; women, 25,112,338)--a condition the reverse of that obtaining in almost every other country.

Now the young j.a.panese are a very home-loving folk, and even if they were not, almost all Shinto parents, realizing the paramount importance of having descendants to worship their spirits, favor and arrange early marriages for their sons. And what with this compet.i.tion for {43} wives, the undiminished demand for female servants, and a half million fewer women than men to draw from, the outlook for any great expansion of manufacturing based on woman labor is not very bright. Moreover, with Mrs. Housekeeper increasing her frantic bids for servants 81 per cent, in eight years, and still mourning that they are not to be had, it is plain that the manufacturer has serious compet.i.tion from this quarter, to say nothing of the further fact that the j.a.panese girls are for the first time becoming well educated and are therefore likely to be in steadily increasing demand as office-workers. Upon this general subject the head of one of Osaka's leading factories said to me: "I am now employing 2500 women, but if I wished to enlarge my mill at once and employ 5000, it would be impossible for me to get the labor, though I might increase to this figure by adding a few hundred each year for several years."

Unquestionably, too, shorter hours, less night work, weekly holidays, and better sanitary conditions must be adopted by most manufacturers if they are to continue to get labor. The Kobe _Chronicle_ quotes Mr.

Kudota, of the Sanitary Bureau, as saying that "most of the women workers are compelled to leave the factories on account of their const.i.tutions being wrecked" after two or three years of night work, consumption numbering its victims among them by the thousands. Either the mills must give better food and lodging than they now provide or else they must pay higher wages directly which will enable the laborers to make better provision for themselves.

Yet another reason why wages must continue to advance is the steady increase in cost of living, due partly to the higher standard developed through education and contact with Western civilization, but perhaps even more largely to the fearful burden of taxation under which the people are staggering. A usual estimate of the tax rate is 30 per cent. of one's income, while Mr. Wakatsuki, late j.a.panese Financial Commissioner to London, is quoted as authority for the statement {44} that the people now pay in direct and indirect taxes, 35 per cent, of their incomes. And I doubt whether even this estimate includes the increased amounts that citizens are forced to pay for salt and tobacco as a result of the government monopoly in these products, or the greatly increased prices of sugar resulting from the government's paternalistic efforts to guarantee prosperity to sugar manufacturers in Formosa.

IV

Higher still, and higher far than anything the nation has ever yet known, must go the cost of living under the new tariff law. From a British textile representative I learned the other day that a grade of English woollens largely used by the j.a.panese for underwear will cost over one third more under the new tariff, while the increased duty on certain other lines of goods is indicated by the table herewith:

PERCENTAGE OF DUTY TO COST OF ARTICLE

Old Tariff New Tariff

Printed goods 3 22

White lawns 10 47

Shirtings 10 39

Cotton Italians 3 35

Poplins 8 19

Brocades 10 22

Neither a nation nor an individual can lift itself by its bootstraps.

The majority of the thoughtful people in the empire seem to me to realize even now that through the new tariff j.a.panese industry, as a whole, is likely to lose much more by lessened ability to compete in foreign markets than it will gain by shackled compet.i.tion in the home markets. Fa.r.s.eeing old Count Ok.u.ma, once Premier, and one of the empire's Elder Statesmen, seemed to realize this more fully than any other man I have seen. "Within two or three years from the time the new law goes into force," he declared, "I am {45} confident that its injurious effects will be so apparent that the people will force its repeal. With our heavy taxes the margin of wages left for comfort is already small, and with the cost of living further increased by the new tariff, wages must inevitably advance. This will increase the cost of our manufactured products, now exported mostly to China, India, and other countries requiring cheap or low-grade goods, and where we must face the compet.i.tion of the foremost industrial nations of the world.

As our cost of production increases, our compet.i.tion with Europe will become steadily more difficult and a decrease in our exports will surely follow. It is folly for one small island to try to produce everything it needs. The tariff on iron, for example, can only hamper every new industry by increasing the cost of machinery, and must especially hinder navigation and shipbuilding, in which we have made such progress." Not a few of the country's foremost vernacular dailies are as outspoken as Count Ok.u.ma on this point, and the Kobe _Chronicle_ declares that, with diminished exports to j.a.pan, "British manufacturers will find compensation in the lessened ability of the j.a.panese to compete in China; and j.a.pan will find that she has raised prices against herself and damaged her own efficiency."

That such will be the net result of j.a.pan's new policy seems to me to admit of no question. Unfortunately, certain special lines of British and American manufacture may suffer, but, on the whole, what the white man's trade loses in j.a.pan will be recompensed for in China and India.

Even after j.a.pan's adoption of the moderately protective tariff of 1899 her export of yarns to China--in the much discussed "market right at her doors"--dropped from a product of 340,000 bales to a recent average of 250,000 bales. From 1899 to 1908, according to the latest published government figures, the number of employees in j.a.panese cotton factories increased only 240--one third of 1 per cent.--or from 73,985 to 74,225, to be exact, while I have already alluded to the figures showing the {46} comparative English and j.a.panese imports of raw cotton from 1890 to 1909 as furnished me by Mr. Robert Young, of Kobe, j.a.pan in this period going from $30,000,000 to $54,000,000, or 77 per cent., while England's advance was from $135,000,000 to $300,000,000, or 122 per cent. The increase in England's case, of course, was largely, and in j.a.pan's case almost wholly, due to the increased price of the cotton itself, but the figures are none the less useful for the purposes of comparison.

In the frequent attempts of the j.a.panese Government to stimulate special industries by subsidies and special privileges there is, it seems to me, equally as little danger to the trade of Europe and America in general (though here, too, special industries may suffer now and then), because j.a.pan is in this way simply handicapping herself for effective industrial growth. Just at this writing we have an ill.u.s.tration in the case of the Formosan sugar subsidy which seems to have developed into a veritable Frankenstein; or, to use a homelier figure, the government seems to be in the position of the man who had the bear by the tail, with equal danger in holding on or letting go.

Already, as a result of the system of subsidies, bounties and special privileges, individual initiative has been discouraged, a dangerous and corrupting alliance of government with business developed, public morals debased (as was strikingly brought out in the Dai Nippon sugar scandal), and the people, as Mr. Sasano, of the Foreign Department, complains, now "rely on the help of the government on all occasions."

On the same point the Tokyo _Keizai_ declares that "the habit of looking to the government for a.s.sistance in all and everything, oblivious of independent enterprise . . . has now grown to the chronic stage, and unless it is cured the health and vitality of the nation will ultimately be sapped and undermined."

As for increasing complaints of "low commercial morality" brought against j.a.panese merchants, that is not a matter of concern in this discussion, except in so far as it may prove a form of j.a.panese commercial suicide. But to one who holds {47} the view, as I do, that the community of nations is enriched by every worthy industrial and moral advance on the part of any nation, it is gratifying to find the general alarm over the present undoubtedly serious conditions, and it is to be hoped that the efforts of the authorities will result in an early change to better methods.

V