Emil Lederer: Discussion Contribution on Coal Mining (1920)

Emil Lederer’s contribution is an individual speaking turn in an official commission discussion of coal-mining socialization, published on pages 370–373 of volume I. It responds chiefly to Rathenau’s objections to the majority report, with references to Kuczynski and a closing reply to Vogelstein. Its argument moves from the relationship between principle and practical policy, through the authority of management under collective governance, to differences among industries and workers’ attitudes. Lederer’s central claim is that socialization requires a definite direction without prescribing identical institutional arrangements everywhere. Attention to existing conditions is indispensable, but cannot substitute for deciding what economic transformation should accomplish.

Lederer begins by accepting Rathenau’s insistence that economic plans must take account of their underlying conditions. A theorist who derives policy from doctrine while ignoring the surrounding circumstances would, he says, be a bad theorist. Nevertheless, he agrees with Kuczynski that a guiding principle must first be articulated:

Man kann die Wegrichtung nicht realpolitisch bestimmen, sondern man kann die Wegrichtung nur prinzipiell bestimmen.

English translation: The direction to take cannot be determined through practical politics, but only through principle.

The distinction is between choosing a destination and determining a practicable route. Without the former, adjustments to immediate circumstances follow the line of least resistance, leaving arrival at the intended goal to chance. Lederer therefore demands a connection between principle and practical politics, not the exclusion of either. He also qualifies his criticism: Rathenau does not actually advocate abandoning principle, but treats the majority report as though it supplied principles without examining the means and foundations of their realization.

The military analogy that follows makes the disagreement more concrete. Rathenau had invoked eighteenth-century grenadiers’ inability to imagine warfare in 1914 as a warning against constructing the future economy in advance. Lederer counters that modern warfare cannot be understood merely as an accumulation of small technical improvements. A new organizing principle—the arming of the people, realized in the French Revolution—had intervened and overturned supposedly immutable military assumptions. Rathenau’s recorded interruptions clarify that he meant the technology and atmosphere of warfare; Lederer nevertheless presses the importance of institutional discontinuity. The example supports his warning that treating present capacities and habits as decisive constraints can prevent a desired transformation altogether. The disagreement concerns the relative weight given to the route and the goal.

Lederer then addresses Rathenau’s characterization of the proposed representative body as an artificial municipal council. Bringing different social forces together in one institution, he argues, was already a feature of plans for an economy organized in the common interest, including plans with which Rathenau had been associated. Such a body could select personnel and judge the broad economic direction of its sector. The practical issue is whether an executive answerable to it could exercise effective authority.

Against Rathenau’s contrast between weak public managers and powerful corporate directors supported by shareholders, Lederer disputes the assumption that managerial strength belongs uniquely to private enterprise:

Ich kann nicht einsehen, daß diese ganz elementare Triebkraft des Erfolghabensvollens und auf der anderen Seite die ganz elementare Tatsache des Erfolghabens nicht dem gemeinwirtschaftlichen Körper gegenüber wirken sollten.

English translation: I cannot see why this quite elementary drive to want to succeed and, on the other hand, the quite elementary fact of succeeding should not operate in relation to a body organized in the common economic interest.

His examples concern municipal electricity undertakings and successful local administrations. Lower financial returns need not demonstrate administrative weakness: they may reflect a different pricing policy and operating principle. Conversely, a publicly accountable director who achieves conspicuous results may acquire enough authority to resist patronage and sectional interests. Lederer cites Schwander’s administration in Strasbourg, while Rathenau insists that Schwander’s strength rested on political influence rather than financial or substantive achievement alone. These interruptions leave the empirical disagreement visible. Lederer acknowledges that he cannot match Rathenau’s breadth of experience; his narrower claim is that public governance does not exclude authority earned through performance. A successful coal directorate could command the respect of its council much as corporate management commands that of shareholders.

The closing reply to Vogelstein applies this combination of principle and practical differentiation to workers’ attitudes. Coal-mining socialization, Lederer argues, matters more to workers than the socialization of toy manufacture. He invokes Germany, England, and the United States, alongside his experience of Austrian trade-union negotiations. Unions in primary production behaved differently from those representing export industries, whose members felt their exposure to world markets and the instability of their position more strongly.

Das Prinzip setzt sich nicht in der ganzen Linie sofort mit einem Schlage durch, nicht überall in der gleichen Weise.

English translation: The principle does not establish itself immediately across the whole line in a single stroke, nor everywhere in the same way.

This qualification gives practical content to the opening argument. Different industries may require different institutional designs, and workers need not demand simultaneous socialization everywhere. Lederer explicitly appropriates Rathenau’s appeal to realities, but refuses to let uneven implementation become a reason for abandoning the principle itself. His conclusion makes the criterion of disagreement unmistakable:

Ich kann nur wiederholen, daß ich in dem Vorschlage des Herrn Dr. Rathenau beim besten Willen überhaupt nichts zu erblicken vermag, was in die Richtung einer Sozialisierung zu weisen scheint. Er würde keine wesentliche Änderung des heutigen Zustandes bedeuten.

English translation: I can only repeat that, with the best will in the world, I can see absolutely nothing in Dr. Rathenau’s proposal that appears to point toward socialization. It would entail no substantial change in the present state of affairs.

The contribution’s significance lies in this test of reform: institutional feasibility matters, but so does whether a proposal changes the direction of economic organization. Lederer defends socialization as a guiding objective compatible with differentiated implementation, managerial initiative, and attention to concrete conditions.