M. Dausset continues:

"The contract system is equally well suited to the paving and asphalting of the streets, and their maintenance. "Here again everything depends upon the quality of the material employed and on the process and the care in manufacture, as well as on the way the work is performed. Taking into account the importance of the streets and the traffic they will be called upon to bear, the contractor would know how to make the necessary distinctions and would not hesitate, for example, to increase by a centimeter the thickness of the asphalt bed demanded by the specifications, if the street were much frequented, in order to escape expensive repairs in the near future, and to lessen thus the annual cost of maintenance.

"In the same way, in the case of construction and maintenance of cobbled roads, the government, ill equipped and lacking the flexibility indispensable for performing such work rapidly and economically by profiting by the experience of each day, has every interest in leaving such work to private industry, while reserving for itself the equally important and delicate task of control."

In his investigation of the efficiency of municipal work Benjamin Welton also shows the superiority of the business man over the public official.1

"The problem that he has to solve is simple, and he considers it as a whole. He is not hampered by all sorts of restrictions. He seeks the most competent men, discharges the incapable, and is able to give bonuses for

increase of production. His rule is to compare expenditures and results. He does not hesitate to make necessary expenses which will be economy in the long run. He organizes his units in such a manner that they give the maximum income. Above all, it is impossible to falsify his reports because they are verified by the party with whom he is under contract.'

9. The Socialists would have us believe that from the moment a government or a municipality engages in the nationalization or the municipalization of public utilities it perseveres in the undertaking.

Yet we have seen that such undertakings have been abandoned in Great Britain and Germany, while, as for New Zealand, Mr. Scholefield, in 1909, and Messrs. Le Rossignol and Stewart, in 1912, are united in the conviction that:

"Of late years the whole tendency has been to leave more and more to private enterprise. It is a swing of the pendulum. Ten years ago the government would not have dared to suggest allowing private companies to develop the great assets latent in the energy of the rivers of New Zealand. To-day it is the avowed policy of the state to encourage private enterprise in this direction. It is highly improbable now that New Zealand will make any further pronounced advance toward State Socialism until a new temper succeeds to the present mood of conservative Liberalism."

The New Zealanders are not theorists, but a certain number are sufficiently shrewd to perceive that, when a loss is resulting from a state enterprise, it affects the whole nation. In other words, that the govern

ment in pursuing such a policy is forcing some individuals to help to bear the financial burdens of others.

10. J. C. B. Perry, in a letter to the Manchester City News, of March 4, 1911, said:

"If gas were being furnished by a private company it would have to have a high illuminating power. We cannot force the gas committee to give it, and it does not give it. If the tramways belonged to a company they would not be permitted to monopolize the streets in the center of the city to the detriment of all other species of transportation. Our market committee is losing on its refrigerating plants, while a competing company is a commercial success and is giving 'cheap food'."

When political or administrative bodies, whether states or municipalities, operate, they are regulating themselves. This is a sufficient reason in itself for the suppression of all public trading operations, because it is necessary that there be a distinct separation between the forces of operation and regulation.

Industrial operation is inherently adapted to private enterprise. Industrial control is the corresponding function of states and municipalities.

BOOK III

ADMINISTRATIVE RESULTS

CHAPTER I

ADMINISTRATIVE RESULTS

Friends of socialization and municipalization, handicapped by the financial results of the various forms of government ownership publicly advocated by them, have recently made a change of front. All right, they say, publicly owned utilities do not bring in profits; but to compare public administration with private is to do the former an injustice. Its aim is not profit but service. It sacrifices financial results to administrative results in the interest of the moral and material progress of the nation.

These theorists, in regard to "administrative results," forget that nothing is free, that everything must be paid for, and that public services are by no means the cheapest.

However, looking at the matter from their standpoint, let us examine the administrative results of direct operation by the state and the municipality and see in how far their statements are borne out by the facts.