This problem, as we have seen already, the existing system solves by its machinery of private competition, and of independent capitals, which automatically increase the powers of the ablest directors of labour, and concurrently decrease or extinguish those of the less able. Socialism, with its collective capital, and its able men reduced or elevated to the rank of state officials, while not obviating, but on the contrary emphasising the necessity for placing labour under the highest directive ability, or, in other words, the necessity for competition among able men, would dislocate the only machinery by which such competition can be made effective; and, if it did not destroy the efficiency of the highest ability altogether, would reduce this to a minimum, and confine it within the narrowest limits.
In this chapter, however, we have been dealing with the machinery only. We have been assuming the unabated activity of the powers by which the machinery is to be driven. That is to say, we have been assuming that every man who possesses, or imagines himself to possess, any exceptional gift for directing labour—whether as an inventor, a man of science, an organiser, or in any other capacity—would be no less eager, under the circumstances with which socialism would surround him, to develop and exert his faculties than he is at the present day. We will now pass on to the question of how far this assumption is correct. The question of machinery is secondary. It is a question of detail only; for if there is no power in the background by which the machinery may be driven, it will not make much difference in the result whether the machinery be bad or good.
And here once more we shall find that the socialists of to-day agree with us; and in passing on to the question now before us, we shall be quitting a region of speculations which can be only of a general kind (for they refer to social arrangements whose details are not definitely specified), and we shall find ourselves confronted by a variety of ideas and principles which, however confused they may be in the minds of those who enunciate them, we shall have no difficulty ourselves in reducing to logical order.
 That such is the case can be seen easily enough by imagining a socialistic community consisting of twenty men, who require and consume only one article, bread. Each man, to keep him alive, requires one loaf daily; but to eat two would be a comfort to him, and to eat three would be luxury. The community is divided into two groups of ten men each, one man in each group directing the labour of the others. We will start with supposing that these two directors are men of equal and also of the highest ability, and that each of the groups, under these favourable conditions, is enabled to produce daily an output of thirty loaves. The total output of both in this case amounts to sixty, which equally divided yields