Case of the London County Council's steamboats.
Two forms which the industrial state under socialism might conceivably take: The official directors of industry might be either an autocratic bureaucracy, or they might else be subject to elected politicians representing the knowledge and opinions prevalent among the majority.
Estimate of the results which would arise in the former case.
Illustrations from actual bureaucratic enterprise.
Estimate of the results which would arise in the latter case.
The state, as representing the average opinion of the masses, brought to bear on scientific industrial enterprise.
Illustrations.
The state as sole printer and publisher.

State capitalism would destroy the machinery of industrial progress just as it would destroy the machinery by which thought and knowledge develop.
But behind the question of whether socialism could provide ability with the conditions or the machinery requisite for its exercise is the question of whether it could provide it with any adequate stimulus.
CHAPTER VIII THE ULTIMATE DIFFICULTY.
SPECULATIVE ATTEMPTS TO MINIMISE IT Mr.Sidney Webb, and most modern socialists of the higher kind, recognise that this problem of motive underlies all others.
They approach it indirectly by sociological arguments borrowed from other philosophers, and directly by a psychology peculiar to themselves.
The sociological arguments by which socialists seek to minimise the claims of the able man.
These founded on a specific confusion of thought, which vitiated the evolutionary sociology of that second half of the nineteenth century.

Illustrations from Herbert Spencer, Macaulay, Mr.Kidd, and recent socialists.
The confusion in question a confusion between speculative truth and practical.
The individual importance of the able man, untouched by the speculative conclusions of the sociological evolutionists, as may be seen by the examples adduced in a contrary sense by Herbert Spencer.

This is partially perceived by Spencer himself.
Illustrations from his works.
Ludicrous attempts, on the part of socialistic writers, to apply the speculative generalisations of sociology to the practical position of individual men.
The climax of absurdity reached by Mr.Sidney Webb.
CHAPTER IX THE ULTIMATE DIFFICULTY, CONTINUED.
ABILITY AND INDIVIDUAL MOTIVE The individual motives of the able man as dealt with directly by modern socialists.
They abandon their sociological ineptitudes altogether, and betake themselves to a psychology which they declare to be scientific, but which is based on no analysis of facts, and consists really of loose assumptions and false analogies.
Their treatment of the motives of the artist, the thinker, the religious enthusiast, and the soldier.
Their unscientific treatment of the soldier's motive, and their fantastic proposal based on it to transfer this motive from the domain of war to that of industry.
The socialists as their own critics when they denounce the actual motives of the able man as he is and as they say he always has been.

They attack the typically able man of all periods as a monster of congenital selfishness, and it is men of this special type whom they propose to transform suddenly into monsters of self-abnegation.
Their want of faith in the efficacy of their own moral suasion and their proposal to supplement this by the ballot.
CHAPTER X INDIVIDUAL MOTIVE AND DEMOCRACY Exaggerated powers ascribed to democracy by inaccurate thinkers.
An example from an essay by a recent philosophic thinker, with special reference to the rewards of exceptional ability.
This writer maintains that the money rewards of ability can be determined by the opinion of the majority expressing itself through votes and statutes.
The writer's typical error.