As a result, driven back upon themselves from every side, the traitors
and their families became clannish. Finding it impossible to dwell in
safety in the midst of the betrayed proletariat, they moved into new
localities inhabited by themselves alone. In this they were favored by
the oligarchs. Good dwellings, modern and sanitary, were built for them,
surrounded by spacious yards, and separated here and there by parks and
playgrounds. Their children attended schools especially built for
them, and in these schools manual training and applied science were
specialized upon. Thus, and unavoidably, at the very beginning, out of
this segregation arose caste. The members of the favored unions became
the aristocracy of labor. They were set apart from the rest of labor.
They were better housed, better clothed, better fed, better treated.
They were grab-sharing with a vengeance.

In the meantime, the rest of the working class was more harshly treated.
Many little privileges were taken away from it, while its wages and its
standard of living steadily sank down. Incidentally, its public schools
deteriorated, and education slowly ceased to be compulsory. The increase
in the younger generation of children who could not read nor write was
perilous.

The capture of the world-market by the United States had disrupted the
rest of the world. Institutions and governments were everywhere crashing
or transforming. Germany, Italy, France, Australia, and New Zealand were
busy forming cooperative commonwealths. The British Empire was falling
apart. England's hands were full. In India revolt was in full swing. The
cry in all Asia was, "Asia for the Asiatics!" And behind this cry was
Japan, ever urging and aiding the yellow and brown races against the
white. And while Japan dreamed of continental empire and strove to
realize the dream, she suppressed her own proletarian revolution. It