Popular Science Monthly/Volume 61/August 1902/Social Bacteria and Economic Microbes

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SOCIAL BACTERIA AND ECONOMIC MICROBES, WHOLESOME AND NOXIOUS. A STUDY IN SMALLS.
BY EDWARD ATKINSON, LL.D., PH.D.
The profit of each generation, or in the present era the profit of each decade, consists in the saving of what was wasted in the last one.

I HAVE long sought a method by which the value of the annual product of this country at the prices fixed at final distribution, commonly called retail prices, might be ascertained with approximate accuracy. In the study of the data of 1880 I was led to the conclusion that the average per capita expenditure (and therefore the annual product in its final stage) of the people of this country for the necessaries, comforts and luxuries of life could not be less than what $200 per head could buy at the prices of the census year. The proportion of the population occupied for gain varied but a fraction from one in three, leading to the conclusion that the average product of each person occupied for gain could not be less than $600 worth a year. Assuming this estimate to be approximately correct, this sum must have been the measure in money within which the cost of living, the taxes, additions to capital and all personal expenditures must have been covered. But on multiplying the population of the census year 1880 by $200 worth per head, I was led to a very much larger estimate of the value of the annual product than the estimates of any other student of social facts. I revised this computation on the basis of the census of 1890, reaching a conclusion that, while prices had been lessened, the value of the annual product at the lessened prices had reached not less than $225 worth per head or $675 per person occupied for gain. Upon revising the figures of 1900 as far as given—these figures being more adequate than any before compiled—I have again reached the conclusion that the per capita product of the year reported in the census of 1900 was not less than what $225 per capita would come to, each dollar of that $225 standing on the average for a considerably larger quantity of products than ever before. At the present time prices have been enhanced, in consequence mainly of a short product of Indian corn, of potatoes and other root crops, and of some other products; but under the present aspect of ample crops and normal production a return to normal conditions may be anticipated within a few months or by the time when the population of this country will number 80,000,000, say in 1903-4. For convenience in this preliminary study I therefore use 80,000,000 as the factor of population. I have computed the per capita expenditures on many lines from the data of 1900 and 1901, then by multiplying these normal figures of the two normal years before the effect of the short crop of 1901. In this way I compute the per capita and the gross value of each subject treated as it will be on a population numbering 80,000,000. This is only a preliminary study, subject to correction and completion after the final data of the census of 1900 become available; also subject to verification by other methods than the official census, such as I have made use of in this partial analysis. Within the limited time and space allowed I can not cite authorities. Suffice it that I have, as far as possible, verified figures by reference to the special experts of the census and to various students of specific arts and subjects; notably in iron and steel, liquors, tobacco, cottons, woolens, dairy products, etc.; to all of whom I shall give credit when this preliminary study has been carried to completion. Item No. 1, Liquors, Divided into Spirits, Wines and Fermented Liquors.—The average consumption of liquors has been computed in the Bureau of Statistics of the Treasury Department for many years with outside aid from a special trade expert. It has also been computed year by year by the editor of the American Grocer. The two estimates vary. The estimate of the American Grocer of the per capita expenditure comes to $14.20. The official estimate for the same year comes to $17.90. The latter may be more reasonably accepted than the former conservative estimate. This annual expenditure appears to be very large, but it proves in fact that the people of the United States are temperate as compared with European nations. It is evident that, since quantities are measured by taxation and values can be readily measured at the points of distribution, this computation is subject to a very small margin of error. The editor of the American Grocer computes spirits at forty-eight drinks to a gallon, which is the measure of standard liquor per drink in the best clubs. At his estimate of the total quantity, 1-33 gallons per head and amount expended, the average charge per glass of liquor is less than ten cents. Now in view of the custom of watering liquor, making at least sixty drinks to a gallon, and the probably average higher charge than ten cents a drink, his expenditure for spirits is probably too low.[1]

Again, the consumption of beer at sixteen gallons per head is computed at retail prices in half-pint service. The half-pint drink is seldom of full measure, and the sum of this computation would yield only a fraction over three cents per glass. I think no beer is sold at retail at less than five cents per glass.[2]

How the government estimate is computed I know not, but from these figures one may accept the government rather than the Grocer's estimate. I think it is safe to adopt an average of not less than $17 per head for spirits, wines and beer, which, assessed upon 80,000,000 people, would come to $1,360,000,000.

It may be remarked that the consumption of spirits has been very uniform at 1.33 gallons per head for a long period, slightly diminishing rather than increasing for several years. It is at about the same average as that of the United Kingdom of Great Britain and Ireland. On the other hand, our consumption of beer has rapidly increased, reaching a fraction over sixteen gallons per head of light beer, against an average in England of thirty-five gallons per head of strong beer. The price of beer is lower in Great Britain, but the average expenditure for drink is established at twenty dollars per head. The consumption of liquors in France and Germany is also much greater than in the United States.

Item No. 2, Tobacco, Cigars, Cigarettes, Chewing Tobacco and Snuff.—The consumption of tobacco has also been computed year by year by the editor of the Tobacco World, by whom a very close analysis has been made, which time will not permit me to quote in full. This estimate clearly proves that the average expenditure comes to $6.15 per head, say $6, or on a population of eighty million, $480,000,000.[3]

I think it is clearly proved that the animal expenditures of the people of the United States for liquors and tobacco must come to at least $23 per head of the whole population, amounting on eighty million people to $1,840,000,000 in one year.

But there is an unknown addition which can not be readily computed but which should be added to this expenditure. The editor of the American Grocer deducts from the quantity of spirits consumed as a beverage from which the government revenues are derived 16,000,000 gallons, said to be used in the arts. There is reason to believe that more than half the quantity of spirits said to be used in the arts is consumed in making beverages, temperance drinks and quack or proprietary medicines, for which a very high price is paid by ignorant or uninformed persons, many of whom are totally unaware of the fact that they are drinking intoxicating liquor. I will not attempt to add an estimate in money for this waste, resting on the average of $23 per head on 80,000,000 population, $1,840,000,000, which, it will be observed, is ten per cent, of my large estimate of the total expenditures of the people of this country for food, clothing and shelter and all other products necessary to life.[4]

Omitting the short period of war revenues, 1898 to 1902, now abated, the revenue derived by the Government of the United States from liquors and tobacco, domestic and foreign, for twenty years before the beginning of the Spanish War averaged $2.50 per head, to which rate we may return after July 1, 1902, which rate on 80,000,000 people will yield $200,000,000 a year. During the same twenty years prior to the Spanish War this revenue from liquors and tobacco, at $2.50 per head, covered all the normal expenditures of the government of the United States, except interest and pensions, year by year, at $2.50 per head, varying but slightly, namely, the cost of the civil, judicial and legislative departments, the support of the army and of the navy (including naval construction during those twenty years), public buildings, deficiency in postal service and all other normal expenditures.

It will be remarked that when the government again derives a revenue of $2.50 per head or $200,000,000 per year from liquors and tobacco after July 1, 1902, that revenue will constitute a little less than eleven per cent, of the total expenditure for liquors and tobacco computed at $1,840,000,000.

Again, assuming that these expenditures for liquors and tobacco are equal to ten per cent, of the entire cost of living of the whole population, then the government tax upon liquors and tobacco comes to a little more than one per cent., which is assessed upon the total product of the entire country estimated at $225 per head at retail prices. Yet this tax is a purely voluntary contribution to the support of the government. Those who consume neither liquor nor tobacco pay none of this tax; those who do consume these articles pay the tax in the exact proportion of their consumption.

Item No. 3, Wheat or White Bread.—A few years since a well established estimate of the consumption of wheat flour per head of population was one barrel, say 200 pounds, per year. Since then the increased product of wheat, the lessened price and the greater ability of the masses of the people to consume white bread brings that estimate up from 200 pounds to at least 230 pounds of flour. Assuming that the retail price of flour on the average of all parts of the country is two cents a pound, or four dollars a barrel, or $4.60 per head of population on a consumption of 230 pounds each, the cost of flour to 80,000,000 persons would be $368,000,000. Two hundred and thirty pounds of flour will make 325 pounds of bread, yielding a little short of a pound of bread a day per head of population.

I can make and bake six loaves of bread, weighing twelve pounds, in an Aladdin oven with an expenditure of less than two cents for fuel oil burned in a common lamp with some trifling addition for yeast and salt. In other words, a little over eight pounds of flour, costing between seventeen and eighteen cents for the best kinds, can be converted into twelve pounds of bread at a cost of much less than two cents a pound of bread. What then is the cost of bread to the mass of the consumers? What proportion make their own bread? What proportion buy it? This is a problem of difficult solution.

I find that the price of bread in Boston, delivered by grocers and bakers, ranges from a little less than five cents a pound for very poor bread up to ten cents a pound for very good bread. Bread delivered in New York of an average better quality costs less to the consumer. What it is in other cities or in the country I am unable to state. But in view of the large amount of wheat flour which is converted into cake, into fancy biscuits and into pastry, it may not be out of the way to compute 325 pounds of bread per capita at four cents a pound or $13 per head expended for wheat flour when converted into bread, cake, biscuit, pastry and cereals equals $1,040,000,000.

What should be added for bread made of other grain? In the South corn meal is probably used in larger quantity per capita than wheat flour. Large quantities of corn meal, rye meal and oatmeal also serve as bread or as cereal food. There would probably be but a small margin of error if we computed the cost of other grains than wheat in the form of bread or cereal food at $6 per head, making the total grain bill $19 per head, or on 80,000,000 people $1,520,000,000; being considerably less than the expenditure for liquors and tobacco.[5]

This brings out the most important question in practical economics. If I can buy the best wheat flour and with twenty minutes a day of light exercise make one pound of bread each for twelve persons—breadmaking being one of the simplest arts and one most easily learned; and if this bread costs less than two cents a pound, why should the bread of the masses of the people in the cities cost them more than four cents; or, in other words, what are the relative charges for distribution? The barrel of flour of which my bread is made has been brought to me a thousand miles at a charge of 50 cents or less, of which 30 cents may represent the cost of the service and 20 cents the possible net revenue of the railway to be applied to the payment of interest on bonds or dividends on the stock. That barrel of flour, making 280 pounds of bread, divided into 50 cents, charge for railway transportation, makes the cost of that part of the railway distribution of the loaf less than two tenths of a cent per pound of bread. On the other hand, the cost of distributing the loaves of bread in the city after they have left the mouth of the baker's oven is more than two cents per pound. The misdirected energy of the community has been devoted to denunciation of the railway service and to misdirected efforts to cheapen the cost of food by compelling railway corporations to lessen their rates whether they are profitable or not, while little or no attention has been given to improving the methods of distribution of bread at retail or to getting rid of the exorbitant charge for distributing loaves of bread at the rate of two cents a pound or more as compared to two tenths of a cent a pound or less over the railway. This observation will apply to nearly every article which enters into the cost of subsistence, especially the distribution of fresh vegetables. How to reduce the cost of distributing the necessaries of life in small parcels and how to save the waste of good material after it has been distributed are the real problems for practical economists to deal with.

Item No. 4, Sugar.—The import and production of sugar are well established in quantity and value; the consumption per capita is known; it is one of the articles on which the cost of refining has been reduced to the smallest fraction, and both the wholesale and retail profits to the lowest point. The latest consumption has been fixed at 68 pounds per head, without counting molasses. If we add the molasses at a very small fraction, we may count the average consumption at 70 pounds per head at an average price of five cents a pound or $3.50 per head for refined sugar. But a quantity which cannot be measured is converted over into jams, jellies, preserves and condensed milk. In the latter industry one single establishment is reputed to consume more than the entire product of all the beet-root sugar factories in this country, estimated at about 150,000 tons. If sugar were free of duty an immense impulse would be given to agriculture and to fruit growing. A very small number of persons can ever be employed in raising beets for sugar, because the weeding of the beets must be done by hand and there are very few sections of the country where the people are so poor as to find suitable employment in this occupation, but with free sugar an immense impulse will be given to the making of condensed milk for home use and export, and to the saving of fruit now wasted, for conversion into jams, jellies and preserves. We should take the commerce of the world on these lines, and by free sugar provide excellent employment for ten where one can ever be occupied in raising beets.

Another large quantity of sugar is converted into candy. None can measure this factor. The highest rentals at the corners of the most frequented streets in cities are paid for occupation in the distribution of candy. I happen to know of four corners now occupied in Boston on which the rental is more than $25,000 a year, these shops being devoted exclusively to retail traffic in candy of all sorts with prices of from ten to forty cents a pound. It follows that at least fifty cents per head should be added to the retail price of the refined sugar, making the total expenditure for sugar four dollars per head, or on a population numbering 80,000,000, $320,000,000 a year.

Item No. 5, Meats and Vegetables.—It will be impossible to deal with the average expenditure for meat at the present time. Poultry and eggs at farm values come to $3.69 per head. The product of slaughtering establishments large enough to be included under the head of 'Manufacturers' in the census comes to $10.31 per head at the works. Butter, cheese and condensed milk at such works as are big enough to be included in the census come to $1.72 per head. But more animals are slaughtered outside the large establishments than in them. The figures of poultry and eggs, of butter, cheese and condensed milk are probably not half what they are at the farms if farm products are added to census figures. When the agricultural reports are finally published and compared with the census figures it will become possible to reduce these factors to terms very closely approximating the average per capita expenditures for consumption. The only item of necessary expenditure which exceeds liquors and tobacco is the expenditure upon animal food. The expenditure for beer is less than five cents a day per capita; how much is the cost of milk?

Item No. 6, Pig Iron.—The people of the United States are not only the largest producers but also the largest consumers of pig iron in the world; yet at 450 pounds per head, which is nearly double the domestic consumption of England, Belgium, France and Germany, who are our chief competitors, the average per capita product of pig iron at the works comes to only $4.50 per head. Prices are rising and consumption is increasing; by the time we have 80,000,000 people the average consumption will probably be 500 pounds per head if the works can supply it, which may then be computed at about five dollars per head for the average of forge iron, Bessemer metal, and of iron ore converted into open hearth steel, in their crude forms at the works; making on 80,000,000 a consumption of $400,000,000 worth at the place of production. In order to carry this crude iron and steel into their finished forms through various transformations, it is probable that at the points of final consumption the products of iron and steel may be rated at about $12.50 per head, or on 80,000,000 population $1,000,000,000, a little more than half the price paid for liquors and tobacco. So much for some of the chief factors in production and consumption.

In this way I have given a preliminary study of the value of the annual product at its point of ultimate consumption or export. By making the study in smalls I have attempted to call your attention to the relative importance of several elements of subsistence. It will be several months before this study can be completed; suffice it that I have gone far enough to prove conclusively to my own mind that even on the return to normal prices, which may ensue if we have good crops this year before the population of the country reaches 80,000,000, the average of $225 per head or more will be proved, on which basis the annual product computed at that date and in that manner will be measured by the sum of $18,000,000,000. It may then be possible to estimate the proportion which this product will bear to the capital of the nation, which will require a separation of the site value of land from the estimate of national wealth by which the public is deluded. What really constitutes national wealth is the use made of land and the improvements placed upon it by human energy.

I may now give you some curious examples of how the income derived from the production, purchase and sale of these commodities is distributed by way of railway charges, duties, national expenditures, support of schools, fire losses and losses by commercial failures.

Item No. 7, Tea, Coffee and Cocoa.—The editor of the American Grocer computes the annual expenditure for tea, coffee and cocoa by a method that leaves very little margin for error and which gives $2.34 per head; which assessed on 80,000,000 comes to $187,200,000. This sum added to the amount computed for liquor and tobacco gives a fraction over $25 per head for beverages and tobacco, or over $2,000,000,000 a year.

Item No. 8, Textile Fabrics.—The census data on cotton, woolen and silk fabrics, deducting exports and adding imports, gives approximately $15 per head for clothing materials and carpets at the works. The extension of these values at mills in clothing and other uses will give approximately $30 per head as the expenditure of consumers on this class; which assessed on 80,000,000 comes to $2,400,000,000. After consultation with clothing manufacturers, I put cotton clothing at $8 per head, woolen, $12, silks, linens, laces, embroideries, etc., etc., at $10, subject to further study.

Item No. 9, Boots and Shoes.—The value at the factories is $3.42 per head, approximately $5 to consumers; which assessed on 80,000,000 comes to $400,000,000.

Item No. 10, Wool.—The average value of the annual wool clip of the United States at the farms and ranches comes to 66 cents per head. The maximum value of the largest product of beet root sugar is 10 cents, making together 76 cents; which sum assessed on 80,000,000 people amounts to $62,800,000, or a sum not exceeding 112 per cent. of the total product of agriculture in a normal year. Yet the farmers have been led to believe that their interests demand almost prohibitive duties on these two petty products, leading them to support a policy which costs them in the price of their clothing and sugar twice or thrice the total value of these two products, which duties obstruct the export of their surplus of the principal crops and the development of domestic industry in the most obnoxious way.

We may now deal with a few other problems of distribution which may be of interest.

The freight charges on all the railways of the United States in the year 1900 amounted to a little over $1,071,000,000, which was at the rate of three quarters of a cent per ton per mile, and at the rate of $13.79 per capita, which may be compared with $23 per head for liquors and tobacco.

For this sum of $13.79, 14 tons of food, fuel, fibers and fabrics were hauled 142 miles for every man, woman and child of the population. The average capital invested per capita amounted to $151, on which the railway corporations succeeded in earning $5.13, or 312 per cent, on the average per year.

The highways of the country are free, and those who feel themselves oppressed by these great combinations of capital are also free to cart their own 14. tons 142 miles in their own way if they want to. For myself I prefer to hire Morgan, Gould, Harriman and the Vanderbilts to do my carting.

 

The Support of Schools.

The annual appropriation for the support of common schools ranges from less than one dollar per head in many States to five dollars per head in Massachusetts. The average is three dollars per head, which sum assessed on 80,000,000 comes to $240,000,000. Schools are the antidote for liquor—when the money spent on schools exceeds the money spent on whiskey we may boast of our progress.

 

National Expenditures.

The amount expended in the year ending June 30, 1901, for civil, judicial, postal service, public buildings, Army and Navy on a peace basis, may be computed at the normal rate of $2.50 per capita.
Pensions, 1.79 ""
Interest, .42 ""
Normal expenditure free from warfare, $4.71
Cost of militarism and of the attempt to subjugate the people of the Philippine Islands, 1.86
Total, $6.57
The cost of militarism, mainly expended in the effort to subjugate the Philippine Islands amounted to $144,183,239

Our exports to the Philippine Islands in the same year amounted to less than four cents per head of our population. We have wasted nearly two dollars a head for two or three years in the effort to control an export at four cents a head.

I submit this preliminary and partial analysis of consumption for criticism and suggestion. It will require some weeks of close study of the census and other data for its completion. I may hope to finish this work soon after July 1, and expect to prove that my estimate of our annual product at $225 per head will be more than sustained.

In conclusion I may call attention to what I believe to be the facts. The normal rate per capita of our national expenditures at $5 per head, tending in time of peace to diminish, bears a ratio of not exceeding 2y 2 per cent, to my estimate of the national product. Even at the present rate of about $6.50 per head, imposed upon us by our temporary military aberration, it does not reach three per cent.

Our principal competitors in the great commerce of the world—Great Britain, France, Germany, Belgium and the Netherlands—are subject to an average rate of $14 to $15 per capita, mostly imposed to meet the interest on war debts and the cost of militarism. This burden, tending to increase, stands for a rate of from eight to fifteen per cent. on their lesser national product.

On this difference only we save from $700,000,000 to $800,000,000 a year, or, in other words, gain that amount which our principal competitors now waste in destructive preparation for war.

People of some prominence in political and clerical life often expose their shallow capacity or their ignorance, by sneering at 'commercialism' and by trying to discredit those who oppose the brutality of war by speaking of commerce as a mean and selfish pursuit.

Commerce lives and moves and has its being in mutual service rendered by men and nations for mutual benefit. It demands peace, order and industry.

War exists because of the survival of the brute element in man, which has not yet been overcome by education.

As surely as Christianity will displace paganism, as surely as civilization will displace barbarism, as surely as intelligence and education will displace ignorance, so surely will the beneficent force of commerce suppress the barbarity and brutality of war.

  1. Quantity of spirits estimated and taxed in the year 1901, 87,086,839 gallons, at 48 drinks per gallon computed at $4.50 retail, $391,890,775, if all were consumed as a beverage. In that year there were 26,000,000 males of seventeen years of age and over. The quantity named would give less than half a drink a day to this number. Drinks are at the rate of one or more per day. It follows that less than half the males of seventeen or over ever drink spirits, and by as much as some drink more must others go without.
  2. The quantity of beer consumed in 1901 was 1,254,653,009 gallons at 16.20 gallons per head, which the editor of the American Grocer computes at fifty cents per gallon at retail, $630,922,886. One gallon yields sixteen half pints. At fifty cents a gallon that comes to a fraction over three cents for a full half pint, which is too low an estimate. This quantity at 16.20 gallons per head would yield only half a pint a day to 29,160,000 people out of over 76,000,000, and as those who drink beer habitually far exceed half a pint a day, it follows that probably not half of the adults drink beer.
  3. This computation of six dollars per head of population would give each person less than two cents' worth of tobacco a day. But a considerable part of the population goes without tobacco in their early years. It would seem but a small allowance if we estimated that the users of tobacco averaged four cents' worth per day, and at that rate the estimate of the Tobacco World would supply only a little over a half of the population. Do half the population use four cents' worth of tobacco per day? If they do, by so much as some use more others must go without. I shall leave it to each smoker to compute the price of his own consumption of tobacco or cigars by his own average. I am afraid I deprive a great many other men of this solace by my own excess— over four cents a day.
  4. Per Cent. Alcohol by Volume in Various Compounds.
     
    Ayer's Sarsaparilla, 26.2 per cent.
    Hood's" 18.8 ""
    Golden's Liquid Beef Tonic, 'recommended for treatment of the alcohol habit,' 26.5 ""
    Liebig Company's Cocoa Beef Tonic, 23.2 ""
    Praker's Tonic, 'purely vegetable, recommended for inebriates,' 41.6 ""
    Boker's Stomach Bitters, 42.6 ""
    Warner's Safe Tonic Bitters, 35.7 ""

    For an analysis of a very large number of these nostrums, not only in respect to alcohol, but for the proportion of iodide of potassium and other poisonous drugs and chemicals, see 'Report of Massachusetts Board of Health,' Pub. Doc. No. 34, pp. 614 to 620 inclusive; published in a separate pamphlet.

  5. An observation in smalls discloses the fact that the one machine shop now making 45 per cent, of the twine-binding grain harvesters of this country now turns out one complete harvester every eighteen seconds during eight working hours of each day for 300 days in the year, and being unable to meet the increasing domestic and foreign demand the company is now extending its works so as to turn out one every ten seconds.