Emil Lederer, Arbeit — nicht nutzlose Subventionen. Alles für die Nutzung der brachliegenden Produktivkräfte! (1932)

Emil Lederer’s newspaper article proposes redirecting existing public subsidies toward production by unemployed people for unemployed people. Its central problem is the coexistence of unmet household needs, idle factories, and unused labour, while public money sustains industries whose output may serve no immediate purpose. Lederer moves from a critique of subsidy policy to a practical scheme of mutual assistance, then addresses objections concerning demand, financing, and trade-union wage policy. His proposal seeks to change what public expenditure enables, without requiring an additional burden on public budgets.

The opening broadens the meaning of subsidy beyond direct payments. Cheap loans, dubious public investments, tariffs, and railway procurement can all preserve enterprises that would otherwise fail. Lederer acknowledges employment preservation as a motive, but questions whether it justifies producing unwanted equipment, accumulating stocks, or subsidizing exports. With a rapid fall in unemployment unlikely, expenditure should instead improve unemployed households’ access to necessities. The decisive move is to treat the allocation of existing funds, rather than their scarcity alone, as the policy problem:

Es wäre ohne weiteres möglich, mit denselben Mitteln, das heißt ohne eine zusätzliche Belastung der öffentlichen Haushalte, die Produktion von Erwerbslosen für Erwerbslose zu finanzieren und derart die Zahl der Arbeitenden zu erhöhen und die Versorgung der Erwerbslosen wesentlich zu verbessern.

English translation: It would readily be possible, with the same resources—that is, without placing an additional burden on public budgets—to finance production by unemployed people for unemployed people, thereby increasing the number of people working and substantially improving provision for the unemployed.

Lederer grounds this proposal in existing practices rather than an abstract organizational ideal. Unemployed people’s hostels, repair workshops, and cooperative housebuilding already demonstrate mutual assistance. In the housing example, municipalities supply materials while participants contribute labour, reportedly reducing construction costs to one-third of the normal level. He proposes extending this principle to vacant enterprises, compensating owners for equipment wear. Unemployed workers and salaried employees would retain their benefits rather than receive wages, producing clothing, shoes, household goods, and certain foods.

Free distribution is the mechanism meant to distinguish this arrangement from low-wage commercial production:

Diese Gebrauchsgüter müßten dann an die so Beschäftigten und die Arbeitslosen ohne Entgelt verteilt werden, um eine Störung des Marktes zu vermeiden.

English translation: These goods for use would then have to be distributed free of charge to those employed in this way and to the unemployed, in order to avoid disrupting the market.

This separation between production for need and production for sale carries much of the argument. Lederer maintains that free goods would not diminish unemployed people’s aggregate purchasing demand because their benefits are already too small to cover their needs. Some changes in the composition of purchases might occur, but he regards them as minor. Winter relief supplies his comparison: distributions of shoes and clothing were not generally feared as threats to business. His claim is thus not that consumption patterns remain wholly unchanged, but that meeting urgent needs outside the market need not reduce total market demand.

Under the heading addressing reservations that do not constitute objections, Lederer also specifies the scheme’s cash requirements. Raw materials, intermediate goods, supplies, and outside repairs would still have to be purchased. He estimates these costs at about 40 percent of the goods’ retail value, potentially less if enterprises at several production stages participated. On that basis, 50 million marks could yield goods valued at 125 million marks:

Diese Gebrauchsgüter im Werte von 125 Millionen Mark sind reiner zusätzlicher Nutzeffekt.

English translation: These goods for use, worth 125 million marks, represent a purely additional useful effect.

The distinction between expenditure and useful output is central. Purchases of materials would themselves support employment in supplying industries, while the unemployed would produce additional necessities. Lederer contrasts this double effect with subsidies that generate investments whose absence would scarcely be missed outside the beneficiary industries. The choice is concretely between further unwanted locomotives and wagons and the leather, yarn, timber, and other inputs needed for everyday goods. His numerical example is a projected benefit of reorganizing resources, not a report of results already achieved.

The scope extends beyond manufacturing to idle fishing vessels, meat processing, potato purchases, and agricultural production. Existing kitchens, homes, and workshops suggest possible organizational starting points. Lederer’s appeal also rests on the unemployed person’s desire for productive activity:

Das Bedürfnis, produktiv für sich zu arbeiten, ist eben bei den Erwerbslosen überall vorhanden.

English translation: The need to work productively for themselves is, indeed, present everywhere among the unemployed.

Persistent structural unemployment makes this more than temporary charitable relief. As household deprivation deepens, Lederer considers it intolerable to leave labour and productive capacity unused. He cites calculations suggesting that 50 million marks could occupy roughly 100,000 unemployed people in a quarterly cycle.

The final argument addresses the danger that benefit-supported work could undermine wages. Lederer insists that the proposed enterprises would not operate as capitalist businesses: their goods would be given away, not marketed for an employer’s gain.

Das ist ja der springende Punkt und dadurch unterscheidet sich dieser Plan von den fatalen Vorschlägen der Unternehmer, die eine Erzeugung für den Markt durch Lohnsenkung forcieren wollen.

English translation: That is precisely the crucial point, and it distinguishes this plan from the disastrous proposals of employers who want to drive production for the market by lowering wages.

For Lederer, trade unions can therefore defend wages while supporting mutual production. The article’s distinctive contribution is to connect subsidy reform with access to idle productive means: public resources should enable unemployed people to meet their own needs, rather than merely preserve existing industrial interests. Its conclusion gives that practical proposal a wider significance as a breach in the barrier separating working people from the means of production.