The Common Sense of Political Economy
By Philip H. Wicksteed
Philip H. Wicksteed (1844-1927) wrote the
The Common Sense of Political Economy, Including a Study of the Human Basis of Economic Law (Macmillan and Co., Limited, St. Martin’s Street, London) in 1910.The edition presented here is the first edition, which was widely used as an economics textbook in classrooms in the United Kingdom and the United States, and probably elsewhere as well.A few corrections of obvious typos were made for this website edition. We also added occasional parentheses or square brackets to mathematical expressions for clarity [this was necessary in cases where the requirements of browsers to print fractions with a solidus (“/”) causes potential confusion when the entire fraction is to be multiplied by a subsequent factor:
e.g., to distinguish (1/2
x) versus (1/2)
x]. However, because the original edition was so internally consistent and carefully proofread, we have erred on the side of caution, allowing some typos to remain lest someone doing academic research wishes to follow up. We have changed some small caps to full caps for ease of using search engines.Editor
Library of Economics and Liberty
First Pub. Date
London: Macmillan and Co.
The text of this edition is in the public domain.
BUSINESS AND THE ECONOMIC NEXUS
We began by assuming the purchasing power of money and the existence of market prices, and analysed the principles on which we administer our pecuniary resources in the face of these phenomena. Our analysis has shewn us that we administer our pecuniary resources on the same principles as those on which we conduct our lives generally. It has also explained the phenomena of money, which we began by taking for granted, and it already foreshadows an explanation of market prices. In the course of our investigations we have discovered no special laws of the economic life, but we have gained a clearer idea of what that life is. It consists of all that complex of relations into which we enter with other people, and lend ourselves or our resources to the furtherance of their purposes, as an indirect means of furthering our own. This life is not isolated, but it may be studied in isolation, for the economic pressures tell for what they are worth whatever other pressures they combine with, and the better we understand them, as isolated, the better we can predict their effect upon any combination of forces into which they enter. To the social reformer this is of supreme consequence, for the economic forces are persistent and need no tending. If we can harness them they will pull for us without further trouble on our part, and if we undertake to oppose or control them we must count the cost.
We began our inquiries by examining the history of the use of the words “Economy,” “Political Economy,” and “Economics.” We have now reached a point at which it will be well to examine the current use of a connected group of terms, and to attempt to define our relations to them. But before doing so let us take a note of the progress we have so far made. We began by studying the general laws of the administration of resources; and we reached a clear and satisfactory conception of the principle on which each individual, deliberately, blindly, or impulsively, adapts his conduct to the terms on which alternatives are offered to him by nature or by man. We saw that those principles are identical, whether we are dealing with problems of exchange (as in the expenditure of money in the market-place), or with the assigning of exchangeable things to their ultimate uses (as in the distribution of new potatoes or of milk amongst the various claimants within the household), or with the turning of personal and inalienable qualities and powers, in obedience to impulse or deliberate purpose, along the various alternative channels through which they may flow (as in expressions of temper or affection; in admonishing, encouraging, or restraining others; in self-application to tasks with a view to future power or enjoyment; in purely lyric utterances of devotional fervour; or in gratification of æsthetic appetites). Whether our housewife is apportioning the stuffing of a goose at table, or her housekeeping money in the market, or her time and attention between schemes for getting or keeping a connection for boarders and the more direct cultivation and furthering of the general tastes and interests of her life; and whether her husband is conducting family prayers, or posting up his books at the office, or weighing the advantages and disadvantages of a partial retirement from business; whether, in a word, either or both of them are pursuing their ultimate purposes in life and obeying their fundamental impulses by direct or by indirect means, they and all the people they are concerned with are alike engaged in administering resources, in developing opportunities and choosing between alternatives, under the great controlling guidance of the two principles we have been continuously illustrating throughout our investigations. From end to end of life the principle runs unchallenged that marginal significances decrease as the volume of total satisfaction swells, and that that volume should be largest when marginal values are adjusted to the terms on which alternatives are offered.
*21 Now the very widest definition of the economic life, or the range that should be covered by economic study, would not embrace the whole area that is subject to this law; for it would not be taken to extend to the administration, or distribution among varied claimants, of personal and inalienable qualities and powers that flow directly towards their ultimate purpose or expression. The widest definition of Economics would confine their scope to things that can be regarded as in some sense exchangeable, and capable of being transferred or applied according to order and agreement. No one would regard the principles upon which I balance the claims of devotion against those of friendship, or of either against the indulgence of my æsthetic appetites, as within the range of economic science. And so the first point that we have established is that, whatever our definition of Economics and the economic life may be, the laws which they exhibit and obey are not peculiar to themselves, but are laws of life in its widest extent.
Next, if we narrow our view to the consideration of exchangeable things, we may distinguish between acts of administration that directly involve exchange, and acts of administration dealing with exchangeable things, but not themselves acts of exchange. For instance, the housewife’s administration of her stores amongst different claimants at home is not a series of acts of exchange, but is a series of acts relating to exchangeable things. If we pushed for the admission of such acts within the range of the general study of “Economics” our claim could hardly be refused. For what is “economy” if not the “regulating of a home or household”? But the qualification of “political,” that is to say “public” or “communal,” would exclude this domestic branch from the domain of “Political Economy,” so that the only portion of the ground we have so far studied that would be admitted within the precincts of this science would be that portion which is concerned with exchange,—in the case of our housewife, her purchases in the market. Now here it is still more obvious that the principle of administration is identical within and without the region thus defined. The laws of “Political Economy,” so far as we have yet investigated them, are identical with those of “Economics” in the larger and inclusive sense. If Political Economy has any special laws of its own, we have yet to discover them. The expectation that such laws might exist would not have been unreasonable at the outset of our inquiry; for we found that, whereas our general principles of “marginal decline” and “terms on which alternatives are offered” gave an adequate account of domestic administration and seemed to bring us into direct contact with the ultimate facts, yet as soon as we went to the market we encountered two very imperfectly understood and analysed phenomena—the functions and efficacy of money, and the existence of market prices—which were obviously not ultimate facts, and which required further analysis and explanation. As phenomena they certainly seemed to belong to Political or Communal, as distinct from Personal or Domestic Economy. Might it not be that they had laws of their own, laws peculiar to that life of business or exchange in which they first appear? If so, these laws would be the special laws of Political Economy. But this expectation is gradually disappearing. We have already made provisional investigations into the meaning and functions of money, and they have sufficed to shew us that it is in no sense an isolated phenomenon, but that it enters naturally into a system of exchange, which is absolutely dominated, and is explained to its inmost recesses, by the principle of declining marginal significance, in conjunction with the terms on which alternatives are offered. But we have not yet made any express examination of the nature of these “terms on which alternatives are offered” or the causes that determine them. On the area more particularly assigned to Political Economy they present themselves in the shape of market or current prices—a phenomenon which it is obviously impossible to regard as ultimate, which demands explanation, and which we have not yet explained. Here, then if anywhere, we must seek the special and peculiar laws of Political Economy. But the suspicion must already be strong in our minds that we shall not find them; for in the existence of a collective or communal scale of preferences we seem already to have found, or to be on the point of finding, the clue to the explanation of market prices. Much remains to be done, but we can already see that the preferences of each individual help to determine the terms or conditions under which the choice of other members of the community must be exercised. If you take the individuals of the community two and two it is clear that the marginal preferences of each determine the limits within which direct exchanges with the other can be entertained, and we must already have at least a presentiment that the collective scale is the register of the final and precise “resultant” of all these mutually determining conditions and forces.
To seize and follow up this clue will be the task of the remaining chapters of this First Book; but meanwhile we must continue our express examination of the ideas that lie behind such phrases as “economic conditions,” “the economic motive,” “the economic nexus or relation,” “economic forces.” By this examination we shall emphasise certain facts and clear away certain misconceptions which might otherwise escape our notice or entangle our inquiry. To begin with, we have seen that the broadest conception of Economics includes all dealings with exchangeable things, but does not extend beyond them. Thus when we speak of the “economic conditions” realised by any community we think of the general command of exchangeable things they enjoy, and we call these conditions good or bad, favourable or unfavourable, according to the extent and perhaps the nature of this command. And since material things are those that first occur to our minds when we think of exchanges, there is a marked tendency (sometimes conscious and deliberate, sometimes unconscious or even counter to deliberate purpose and definition) to treat “economic” as equivalent to “material” conditions. Broadly speaking, when we hear that in any community the “economic conditions” are satisfactory we think of the people as well fed, well clothed, well housed, and more vaguely as being in the enjoyment of decent and reasonable “comforts.” And note that though all this depends upon the command of things that are exchangeable, it does not follow that the things are all of them actually exchanged. If a man lives largely on the potatoes he grows on his own patch, they affect, and help to constitute, the economic conditions under which he lives just as much as if he had bought them. In the use of the phrase “economic conditions,” therefore, we start from a fairly intelligible basis, though it is obvious on consideration that the word in this connection can have no scientific precision. The transition from material comforts to æsthetic enjoyment, for example, is continuous and imperceptible. Clothes, crockery, counterpanes, furniture, are all valued for the comfort they afford, the pleasure they give to the eye, and the social distinctions that are attached to them. So we cannot purge our conception of the economic conditions under which a man lives from all æsthetic and kindred elements; the interpenetration is too close and intimate. And if we take a broader view and include all exchangeable things in our purview we shall have to include literature, art, education, spiritual enjoyment and edification, and much more, just so far as books, pictures, concerts, and the teachings and the ministrations of religion, come into the circle of exchange and can therefore be commanded by money. The use of the word “economic” in this connection, then, though fairly well understood, eminently convenient, and not seriously or generally misleading, is entirely without precision, and though useful in description it should be avoided in argument.
But when we pass from the phrase “economic conditions” to the phrase “the economic motive” the case becomes very different. Here we are in the presence of one of the most dangerous and indeed disastrous confusions that obstruct the progress of Economics. Many writers have thought that the Economists, as such, must not only limit his consideration to certain actions and conditions which concern exchangeable and mainly material things, but must also shut out of consideration all
motives that are not “economic.” And the economic motive is generally defined as the “desire to possess wealth.” The widest definition of wealth, in this connection, would make it include all exchangeable things, but nothing else. Now since we have already seen that no ultimate object of desire can ever be the direct subject of exchange at all, we perceive at once that to regard the “economic” man (as he is often called) as actuated solely by the desire to possess wealth is to think of him as only desiring to collect tools and never desiring to do or to make anything with them. More than this, we have seen that the very law that regulates and balances one against the other a man’s selections amongst exchangeable things, also regulates and balances his choice between wealth and leisure, for instance; that is, between acquiring a larger command of exchangeable things and cultivating a finer enjoyment of those he already commands, or between command of exchangeable things and immunity from painful exertions. It is therefore impossible to examine the action of the “desire for wealth” without at the same time relating it to the desire for ease or the desire for enjoyment. And this conclusion is so inevitable that it has generally been found necessary to associate “love of ease” with “desire for wealth” under the economic motive. And yet this does not help us. A man may be just as strenuous in the pursuit of knowledge or of fame, or in his obedience to an artistic impulse, as in the pursuit of wealth. “The demands of vanity may be as imperious as those of hunger,” so that all the motives and passions that actuate the human breast may either stimulate or restrain the desire to possess wealth. How, then, can we isolate that desire as a “motive”?
Yet it is not unusual expressly to exclude all altruistic motives from the field of economic study and to say, or to imply, that in his economic relations a man is purely self-regarding. We are asked then, first to recognise no other motive than “the desire to possess wealth,” and then, by way of extra precaution, expressly to exclude altruistic motives. But this additional demand is not only arbitrary, but, so far from fortifying the other, it expressly contradicts it; for a man may clearly desire wealth from altruistic motives, so that if I am to exclude altruistic motives I must insist on going behind the “desire to possess wealth” and knowing why the man desires it, so as to be able to exclude all (economically) improper motives. This is not treating the “desire to possess wealth” as itself the “motive” at all.
The truth is that the relative intensity of another man’s desire to possess any exchangeable thing, regarded as a fact, apart from his reasons, undoubtedly helps to fix the terms on which possession of that thing is offered to me. If I regard it in this light all considerations of motive are irrelevant; for I am thinking of it as a fact with which
I must reckon, not as a motive which influences
him. If, on the other hand, I look at the matter from his point of view and am interested to know how he comes to want this thing, I must be prepared to recognise all motives that are actually at work. More broadly, the collective or communal scale, on which exchangeable things only are registered, may be accepted as a fact, in which case we are only concerned with the “what” and the “how,” and not at all with the “why,” or we may go behind it and inquire into its genesis, in which case we must impartially recognise all the motives that actually go to forming it. We may either ignore motives altogether, or may recognise all motives that are at work, according to the aspect of the matter with which we are concerned at the moment; but in no case may we pick and choose between the motives we will and the motives we will not recognise as affecting economic conditions. There seems little sense, then, in using the term “economic motive” at all;
*22 for the whole conception appears to be a false category; but the elements of truth which it is a confused attempt to systematise will presently become clear to us.
The phrase “economic relation” places us on much firmer ground; for it may be applied with perfect precision and appropriateness to a great class of relations which we have already been led to examine. We will here recapitulate and expand the conclusions we have reached with respect to them. Every man has certain purposes, impulses, and desires. They may be of a merely instinctive and elementary nature, or they may be deliberate and far-reaching; they may be self-regarding or social; they may be spiritual or material; but whatever they are it is impossible for him to give effect to them by his own unaided action upon the forces and substances of nature. No man, standing naked upon the face of the earth, can feed, clothe, or house his body, or secure an entrance for his mind into the regions of intellectual, imaginative, and emotional enjoyment; nor (suppose he has altruistic impulses) can he, thus unaided, minister to like needs or develop like possibilities in others. Neither can he accomplish these things by the direct application of his own faculties supported by all the material supplies and instruments he possesses or can possess; nor yet, except under very special circumstances, simply by enlisting the co-operation directly inspired by sympathy with him or with his purposes. But by direct and indirect processes of exchange, by the social alchemy of which money is the symbol, the things I have and the things I can are transmuted into the things I want and the things I would. By these processes I can convert my acquaintance with the nature of different kinds of wood, and my skill in handling certain tools, or my knowledge of the higher mathematics, or my capacity for firing men’s imaginations or for chastening or stimulating their religious emotions, into food and clothing, into books and pictures, into the rapid transport of my own person through distant lands, into dinners for hungry children, into May festivities for listless villagers, into the collation of Syriac manuscripts, or into any of the thousand other things that I want to have, to experience, or to get done; and all this independently of any interest in these desires of mine, or any knowledge of them, on the part of very many of the persons who assist me to accomplish them. Even when such an interest exists it may be insufficient (if unsupported by other considerations) to make my sympathisers qualify themselves for the work, and set to it for mere love of the thing to be done. Why, then, do they co-operate with me at all? Not primarily, or not solely, because they are interested in my purposes, but because they have certain purposes of their own; and just as I find that I can only secure the accomplishment of my purposes by securing their co-operation, so they find that they can only accomplish theirs by securing the co-operation of yet others, and they find that I am in a position, directly or indirectly, to place this co-operation at their disposal.
A vast range, therefore, of our relations with others enters into a system of mutual adjustment by which we further each other’s purposes simply as an indirect way of furthering our own. All such relations may be fitly called “economic.” The range of activity they cover is “business,” and in the last chapter we have already incidentally opened our investigation into the causes that lead to it. It often happens that a man’s individual faculties or possessions are not so well suited for the accomplishment of his own purposes as they are for those of another, and the great principle of division of labour, the conception of which is sufficiently widely spread to obviate the necessity of any elementary exposition, re-enforces the natural diversity of capacities and increases the economy of the indirect furtherance of many of our purposes as against their direct furtherance. The principle of division of labour would apply, as writers from Adam Smith downwards have abundantly shewn, even if all men’s capacities and opportunities were identical. It gains an additional range of application and significance from the fact that they are actually so diverse. And again, the results, experienced and anticipated, of this principle of division of labour react upon the deliberate training to which men submit themselves, and enable us, by intentionally cultivating one faculty in one man and another in another, to increase still further our collective command of the things we desire. The whole life of every modern society is built upon this basis, and our activities are determined by it from the outset. If one man possesses wheat in such quantities that he finds it well to exchange some of it for potatoes, and another for like reasons is glad to change potatoes for wheat, this is not generally the result of any miscalculation, and not necessarily the result of any original and inevitable diversity of opportunities or faculties. It was deliberately contemplated and planned from the beginning, because the one man believed that the most economical way for him to increase his stock of potatoes was to grow wheat, and
vice versa. By the system of “economic relations,” then, I understand that system which enables me to throw in at some point of the circle of exchange the powers and possessions I directly command, and draw out other possessions and the command of other powers whether at the same point or at some other. And I define my relation with any other man as “economic” when I enter into it for this purpose of transmuting, either at one or at two or at more removes, what I have and can into what I want and would.
Lastly, “economic forces” or “the economic force” may suitably be used to indicate the resultant pressure of all the conditions, material and psychological, that urge men to enter into economic relations with each other. Could “motive” be used, in accordance with its etymological significance, simply as equivalent to a driving force of any kind, there need be no objection to the use, in this sense, of the phrase “economic motive.” But since it easily suggests a deliberately selected end or goal and has been expressly applied, in connection with economics, to the ethical distinction between egoism and altruism, it will be far safer to avoid it altogether. I shall therefore speak of “economic relations” and “economic forces,” but not of “economic motives.” And by economic forces I shall mean anything and everything which tends to bring men into economic relations. Thus, the invention of machinery which tends to increase division of labour, the concentration of the industrial population, improved means of transport and communication, the credit system, the general demand for elementary and technical education, and, in a word, the whole structure, organisation, and movement of society, is perpetually opening and closing opportunities for combination and for the mutual furtherance of each other’s purposes by men of differing faculty, opportunity, and desire. And these conditions determine how far and in what way the general desire of every man to accomplish his own purposes, whatever they may be, shall become an economic force, urging him to enter into relations with other men, with a view to the more effective accomplishment of his own purposes. Whether I pursue my purposes directly through the application of my own resources and capacities to their accomplishment, or indirectly by entering into an economic relation with other men, applying my resources directly to the accomplishment of their purposes and only indirectly to the accomplishment of my own, in either case my motives are identical. But the attraction which draws me towards the accomplishment of my purposes becomes an economic force whenever the state of knowledge and the organisation of life suggest my entering into an economic relation with some one else as the best means of realising my aims.
And here it may be well to note a second sense in which the term “economic conditions” is often used. Any change in men’s desires or ideals, any change in their knowledge, in their power of effective combination for controlling and directing the public resources—in fact, any change in the articulation of society or the purposes of man—will open up and develop some channels, and close others, by which the individual may indirectly seek the fulfillment of his purposes. And such changes are said to alter the “economic conditions” of the society in question, or specifically of this or that individual or occupation. In this sense a change in economic conditions would not mean a general rise or fall in the command of exchangeable things, but it would mean that the possession of one kind of faculty or resource put a man into a better position for the indirect fulfilment of his purposes, and the possession of another kind into a worse position than had previously been the case. No confusion arises from this double use of the phrase, but if it had not been expressly noted the reader might have observed some inconsistency between the meaning assigned to “economic conditions” earlier in this chapter
*23 and the sense in which it will generally be used in the subsequent course of our investigations.
We have now, it is to be hoped, reached an adequately clear and precise conception of the meaning of “the economic relation,” of “economic forces,” and of “economic conditions,” in this latter sense of the considerations which determine a change of flow in the economic activities. But the misconceptions and confusions that surround this subject are so obstinate, and reassert themselves so persistently, that it will be well to fortify ourselves against them; and I shall therefore endeavour in this chapter to make good certain propositions, some of which have already been provisionally established in an explicit manner, and only need elaboration and confirmation; all of which are implicitly contained in the conclusions we have reached; none of which, except perhaps the last, seem to be uniformly or adequately recognised in the current treatment of Political Economy. These propositions are:—
a) That the economic relation is entered into at the prompting of the whole range of human purposes and impulses, and rests in no exclusive or specific way on an egoistic or self-regarding basis.
b) That the economic forces and relations have no inherent tendency to redress social wrongs or ally themselves with any ideal system of distributive justice.
c) That the hypothesis that the economic relations can be isolated, even if taken only as a first approximation, is too remote from the fact to be admissible, and would be useless and superfluous in any case; and that the economic relation, as well as being naturally allied to other relations in every degree of closeness, has itself a tendency to beget these other relations.
d) That it is nevertheless both legitimate and desirable to make an isolated study of the economic relation and the economic forces, though not on the hypothesis that they actually exist or act in isolation.
a) It is often said or implied that the housewife, for example, is actuated by a different set of motives in her economic transactions in the market and her non-economic transactions at home; but this is obviously not so. The buying potatoes and cabbages in the market and helping them at table are integral portions of the same process, and the housewife is considering the wants of her family when she is making her purchases just as much as when she is distributing them. She is herself one of the family, and her personal and particular tastes and wants are consulted more or less consciously, and carry more or less weight, according to her disposition, her powers of imagination, and her state of mind at the moment; but her purchases are effected and her distributions made with reference to one and the same set of wants. It would be transparently absurd to say that she is only thinking of herself in the market-place, and thinking chiefly of others in the home; or that her motives are entirely egoistic when she is buying the potatoes, and preponderatingly or exclusively altruistic when she is helping them. And as it will be generally admitted that she conducts her marketing in the main on business principles, it follows that the difference between what we are to consider a business transaction and what we are not so to consider is not determined by the selfishness or unselfishness, the egoism or altruism, of the inspiring motive. In like manner, when Paul of Tarsus abode with Aquila and Priscilla in Corinth and wrought with them at his craft of tent-making we shall hardly say that he was inspired by egoistic motives. It is, indeed, likely enough that he was not inspired by any conscious desire to further the purposes (pastoral, military, or what not) of the men for whom he was making or mending tents, but it is very certain that he was impelled to practise his craft by his desire not to be a burden to the Churches, and that his economic life was to his mind absolutely integral to his evangelising mission.
And, indeed, in any complex industrial civilisation every man (unless he is subsidised, which only throws the process one step further back) must obviously be dependent for the accomplishment of his purposes on the indirect process of doing something, or allowing something, in furtherance of the purposes of others, on condition of securing from them the command of services and commodities which will directly minister to his own purposes. The economic relation, then, or business nexus, is necessary alike for carrying on the life of the peasant and the prince, of the saint and the sinner, of the apostle and the shepherd, of the most altruistic and the most egoistic of men.
And if it be not true of any single individual, neither can we expect it to be true of any small group of individuals, whether domestic or other, that the faculties and resources which they collectively command can directly supply their collective wants or fulfil their collective purposes. The group of men who unite to propagate a set of religious doctrines or to call attention to a social or national wrong, or to secure a sanitary or dietary reform, or to preach any gospel or advertise any fad, may have in their own ranks the capacity to expound the truth they believe themselves to possess and the means and willingness to study and to write, but you may be sure that they will want “subscriptions.” That is to say, they will want the means of procuring specified services from persons outside their ranks. They will wish to get persons to print or to distribute literature, or to allow them to occupy a room for a few hours in the week or to store their properties there; and the persons whose services, or the temporary use of whose possessions, they require for the accomplishment of their purpose will be persons who may be selfish or unselfish, but amongst whose purposes, good or bad, the promulgation of the particular thing in question does not take such a place as to induce them to render the services or encounter the sacrifices in question merely for love of the cause on its own merits. Even if Mr. X lends a room and Miss Y does all the clerkage for love of the cause, yet the stationery is manufactured by persons who are paid for their work and have no knowledge of the “cause,” and the circulars are impartially delivered by the same postman who hands in the rival appeals of the enemy, and is himself probably unconcerned alike as to the bane and the antidote, but is intent on keeping his home together, or propagating in his leisure hours some political, social, or religious gospel of his own. Or even if the circulars themselves are printed by an enthusiastic apostle, for love, the type was founded by one of the heathen, whose co-operation in the cause was necessary, and had to be obtained for a consideration. All these profane persons have purposes of their own, which may or may not be as disinterested as those of the Society which deals with them, but which are at any rate different; and it is only if they are put in command of services which will promote their own purposes that they will be willing to render the specific services required to further the purposes of the Society. And seeing that the Society itself is only willing thus to further their purposes on condition that they further its own, there is no room for charges of selfishness on either side, but great room for satisfaction and congratulation on both. It would be ridiculous to say that the enthusiasts who give the printer an order for ten thousand copies of their most effective tract are actuated by purely “egoistic” motives, and if we choose to imagine the case that the printer, on his side, is getting weary of his trade, but keeps on in order to be able to make handsome subsidies to a certain “cause” in which he in his turn is interested, it would be equally ridiculous to say that his motives were “egoistic.” Yet the relation on both sides might be purely economic. Each might enter upon it altogether in furtherance of his own purposes, and in no degree from sympathy in the other’s.
Our complex system of economic relations puts us in command of the co-operation necessary to accomplish our purposes, independently of a complete coincidence between our purposes and our own faculties, and independently also of our being able to command the effective sympathy of persons possessing all the necessary faculties that we lack. A right understanding of the nature of the business or economic nexus, therefore, ought to dispel for ever the animosity with which Political Economy has often been attacked as a degrading study, and the uneasiness with which its own representatives have often defended their science against the charge. In principle the study of business relations is the study of the machinery by which men are liberated, over a large area of life, from the limitations which a failure of correspondence between their faculties and their purposes would otherwise impose upon them. The things they have and can are not the things they want and would; but by the machinery of exchange they can be transmuted into them. The economic relation, then, liberates them from the limitations imposed by the nature of their own direct resources. And this liberation comes about by the very act that brings a corresponding liberation to those with whom they deal. “It is twice bless’d. It blesseth him that gives, and him that takes.” Surely the study of such a relation needs no apology, and there seems to be no room to bring against it the charge of being intrinsically sordid and degrading. The conditions under which business is actually conducted (like other conditions under which we live) may be far from ideal, but the business or economic relation, as such, does not seem to be open to the faintest suspicion of a taint, even when regarded from the loftiest æsthetic or ethical position.
And yet the ground on which this stubborn prejudice rests is obvious enough, and the example of the apostolic tent-maker has already suggested it. We have seen that although Paul was certainly not thinking of himself or of his own advantage when he was making tents in Corinth, yet neither was he necessarily or even probably thinking, in any disinterested or enthusiastic manner, of the advantage of those for whom he was working and whose wants he was immediately supplying. In his attitude towards himself and “others” at large, a man may be either selfish or unselfish without affecting the economic nature of any given relation, such as that of Paul to his customers; but as soon as he is moved by a direct and disinterested desire to further the purposes or consult the interests of those particular “others” for whom he is working at the moment, then in proportion as this desire becomes an ultimate object to him (so that he is directly fulfilling one of his own purposes in supplying these wants) the transaction on his side ceases to be purely economic. No doubt Paul took conscientious pains with his tent-making. So far as this was with a view to business it was done in obedience to an economic force. So far as it was an expression of his own personality or of his independent sympathy with his employers it was not. If you and I are conducting a transaction which on my side is purely economic, I am furthering your purposes, partly or wholly perhaps for my own sake, perhaps entirely for the sake of others, but certainly not for your sake. What makes it an economic transaction is that I am not considering you except as a link in the chain, or considering your desires except as the means by which I may gratify those of some one else—not necessarily myself. The economic relation does not exclude from my mind every one but me, it potentially includes every one but you. You it does indeed exclude, and therefore it emphasises, though it does not narrow or tighten, the limitations of the altruism of the man who enters into it; for it calls our attention to the fact that, however wide his sympathies may be, they do not urge him to any particular effort or sacrifice for the sake of the person with whom he is dealing at the moment. An economic relation may be entered upon equally well from egoistic or altruistic motives; but as long as it remains purely economic, it must remind us that no man’s altruism is undiscriminating to the extent of lavishing itself upon all persons or all purposes at all times. Short of this, clearly the most altruistic person may enter into a relation with another man, the purpose of which is to further the good of those who are other than himself, and also other than the person with whom he is dealing. In that case his action is altruistic because it is inspired by a desire for the good of some one other than himself, and the relation is economic because it is entered into for the sake of some one other than his correspondent.
It is impossible at this point to refrain from anticipating the contents of our paragraph (
c), and reflecting how seldom the economic motive can maintain itself in isolation; and by what insensible degrees I may pass from regarding you solely as a means to my ends into taking some measure of interest, for your sake, in what I am doing for you; but our present concern is not to shew how the economic relation allies itself with others, but to form a sharply defined conception of the nature of that economic relation itself; and to this we must return.
The distinction that we have drawn between the selfish motive, which considers me alone, and the economic motive, which may consider any one but you, is well illustrated by the case of trustees. Trustees who have no personal interest whatever in the administration of the estates to which they give time and thought will often drive harder bargains—that is to say, will more rigidly exclude all thought or consideration of the advantage of the person with whom they are dealing—in their capacity as trustees than they would do in their private capacity. Thus we see that the very reason why a man feels absolutely precluded from in any way considering the interests of the person with whom he is transacting business may be precisely the fact that his motive in doing business at all is absolutely and entirely unselfish. The reason why, in this instance, there is no room for “you” in my consideration is just because “I” am myself already excluded from my own consideration. If I counted myself I should find room for you just so far as “I” take an interest in “you,” but if I do not admit myself I cannot bring in your interests as part of my own programme. The “others” for whom I act are others than you, more completely and irrevocably other than I myself should be; for though I might myself adopt as mine some of your purposes, I cannot affiliate those purposes of yours upon these “others” for whom I am acting. The transaction then becomes more rigidly “economic,” just because my motive in entering upon it is altruistic.
Bursars, again (in the wide sense of representative members of a group of persons with common interests), though they have only a diffused and secondary interest in the business which they manage, have the reputation of a similar rigidity in their business dealings. And the administrators of a charitable fund, when they are distributing their charities or administering their estates, may be inclined to give easier or to exact harder terms than they would do under other conditions according to their individual conception of the nature of their trust. When they debate a special point it will generally be found that the question in their minds is whether the person with whom they are conducting business can or cannot be properly regarded as to any extent a proper subject for the exercise of the very charity which they are administering. Some of them may take the general view that charity is charity, and on the first-come-first-served principle, and actuated by the habit of mind which finds it easier to realise the specific case under consideration than the general body of claims removed by one degree from the centre of the field of vision at the moment, they may urge that it ill becomes a charitable body to drive so hard a bargain as is proposed. Whereas others, with a strict conception of the scope of the charity, and a keen sense of the imperfect manner in which the funds at command enable them to fulfil its objects, will regard themselves as differing but little from fraudulent trustees if they allow any good-natured desire to deal easily with a man to affect their bargain with him. If the question of egoism or selfishness enters here at all it probably pleads on the side of a non-economic arrangement; but in the main the doubt is not as to whether “self” or “others,” but as to which “others,” are to be considered.
The same principles apply to the analysis of the transactions of the housewife with which we started. When she is in the market she is actively and consciously thinking of exactly the same people and exactly the same wants which she is thinking of when she applies and distributes her purchases at home. But when she is sitting at the table she is in the presence of, and is dealing with, no other persons than those whose wants she is considering. When she is in the kitchen or the storeroom giving orders to her servants, she is in the presence of persons whose individual wants are more or less an object of direct interest to her according to circumstances and according to her disposition, and whose tastes and susceptibilities she will be wise to consider for her own sake if not for theirs. Whereas when she is in the market she is dealing with people in whose welfare she has not necessarily any direct concern, and part of whose business it is to consult her tastes and susceptibilities with sedulous care. The economic nature of the transaction therefore emphasises, though it does not impose, the limitations of her altruism. The difference between an administrative act which is also a business transaction and an administrative act which is not, is not that she is thinking of a different set of persons or is actuated by a different set of motives in one case and in the other, but that in one case she is dealing with one set of persons and considering the wants of another set, in the other she is considering the wants of the very people with whom she is at the moment dealing. She is herself one of the people for whom she is providing, yet she is probably, in the main, “unselfish” enough in her dealings in the market-place—that is to say, she is thinking chiefly of “others than herself”—but she is not thinking equally of every one that is not herself. The mere fact that a person is other than herself does not at once awake her keen interest in him, and it may well happen that the persons with whom she is dealing at the moment are amongst those of whom she is thinking little or not at all.
Both in the market-place and the home, then, her main object of consideration is a group of persons of whom she is one, and in which the stall-keepers in the market-place are not included. She is just as selfish and just as unselfish in one case as in the other. But though the members of her household are included in the group of people of whom she is thinking in the market-place, it does not follow that no one else is. You can draw no such line. We have seen that her purchases in the market may be restricted not only by the pressure of other domestic claims, but by the determination to make certain contributions to charitable or religious institutions, or by any other object whatever in which she is interested, however wide or however narrow its application, however near or however remote it may be from the centre of the domestic circle. It is by the nature of the general motives which inspire her life, the general adjustment of her resources, the general principles on which she administers one part of her husband’s income, and the general trend of her influence upon the expenditure of the rest and upon his methods of earning the whole, by the pressure of her character and energy in guiding and stimulating not only his impulses, but those of his and her acquaintances, and any portion of the public to which she has direct or indirect access, by speech, by example, or by written word; above all, it is by her way of looking at things and feeling them, by her mental attitude towards life and her general sense of values, that the degree of her selfishness or unselfishness, her egoism or altruism, is to be determined; and she is actuated by selfish or unselfish, by public-spirited or private-spirited motives, by a broad or a narrow selfishness, by a stupid appetite for martyrdom or a large sense of the significance of life for herself and others, according to her character, not according to the particular act that she is performing. The reason why she does not spend more in the market-place may be because she considers others besides her family; the reason why she eats some of the new potatoes herself may be because she considers herself; the reason why she does not eat more may be because she considers others as well as herself; but probably she is not thinking at all, but feels the collective or conjunct self from which neither she nor any other individual member could be withdrawn without impoverishment to the whole collective life, and into which so much as the idea of self-sacrifice could not be introduced without destroying its vital processes. Self-sacrifice would be no less fatal than self-assertion, and altruism and egoism are alike lost in the communal sense of which she is the organ. If she has occasionally to rebuke the egoism and appeal to the altruism of the little barbarians around her, it is because their communal sense is undeveloped; and she is well aware of the danger of turning them from barbarians into prigs if she develops altruism when it is the communal sense that needs development. Her normal function is by her own unconscious communal sense unconsciously to develop theirs.
But the boundaries of this communal sense are neither stable nor rigidly fixed. Individuals or groups within the family separate themselves (more or less completely, and in few or many relations of life) from the parent stem, and arrangements with them partake of the nature of business. The pressure of the communal sense rises and falls incessantly in the infinite variety of the relations of any community, and the formal limits of the family neither impose a barrier over which the altruistic impulses cannot pass outward, nor form a preserve into which egoistic motives can make no incursions; and wherever altruism and egoism can be rightly spoken of—that is to say, wherever there is a conscious distinction between what I do for my own sake and what I do for the sake of others—it is clear that the note of a business transaction between A and B is not that A’s
ego alone is consciously in his mind, but that, however many the
alteri are, B is not one of them; and B, in like manner, whether he is thinking only of his own
ego or of innumerable
alteri, is not thinking of A.
The proposal to exclude “benevolent” or “altruistic” motives from consideration in the study of Economics is therefore wholly irrelevant and beside the mark. A man’s purposes may, of course, be selfish, but however unselfish they are he requires the co-operation of others who are not interested, or who are inadequately interested in them, in order to accomplish them. We enter into business relations with others, not because our purposes are selfish, but because those with whom we deal are relatively indifferent to them, but are (like us) keenly interested in purposes of their own, to which we in our turn are relatively indifferent. “Business,” then, is primarily a vast network of organisations by which any person or combination of persons can direct their resources and their powers to the accomplishment of their purposes, without the necessity of a direct relation, hard and often impossible to secure, between the objects sought and the faculties and materials directly at command.
There is surely nothing degrading or revolting to our higher sense in this fact of our mutually furthering each other’s purposes because we are interested in our own. There is no taint or presumption of selfishness in the matter at all. The economic nexus indefinitely expands our freedom of combination and movement; for it enables us to form one set of groups linked by cohesion of faculties and resources, and another set of groups linked by community of purpose, without having to find the “double coincidence” which would otherwise be necessary. This economy and liberty will be equally valued by altruistic and by egoistic groups or individuals, and it would be just as true, and just as false, to say that the business motive ignores egoistic as to say that it ignores altruistic impulses. The specific characteristic of an economic relation is not its “egoism,” but its “non-tuism.”
It may be urged, however, that since, as a rule, “ego” and “tu” fill the whole canvas, not only to the spectator, but to the actors also; that is to say, since a man, when he is doing business, is generally only thinking of his own bargain, and how to deal with his correspondent, and not of any one else at all, the exclusion of “tu” is tantamount to the solitary survival of “ego.” So that, after all, “altruism” has no place in business, and “non-tuism” is equivalent to “egoism.” And, indeed, it may be true enough that, as a rule, the average man of business is not likely to be thinking of any “others” at all in the act of bargaining, but even so the term “egoism” is misapplied, for neither is he thinking of himself! He is thinking of the matter in hand, the bargain or the transaction, much as a man thinks of the next move in a game of chess or of how to unravel the construction of a sentence in the Greek text he is reading. He wants to make a good bargain or do a good piece of business, and he is directly thinking of nothing else. All manner of considerations of loyalty, of humanity, of reputation, and so forth, are no doubt present to his mind in solution, so to speak, as restraining influences; and they may easily be precipitated and emerge into consciousness at any moment of vacillation or reflection; but in making his bargain the business man is not usually thinking of these things, and when he thinks of them they act chiefly as restraints. Neither is he thinking of the ultimate purposes to which he will apply the resources that he gains. He is not thinking either of missions to the heathen or of famine funds, or of his pew rent, or of his political association. But neither is he thinking of his wife and family, nor yet of himself and the champagne suppers he may enjoy with his bachelor friends, nor of a season ticket for concerts, nor of opportunities for increasing his knowledge of Chinese or mathematics, nor of free expenditure during his next holiday on the Continent, nor of a week at Monte Carlo, nor of anything else whatever except his bargain. He is exactly in the position of a man who is playing a game of chess or cricket. He is considering nothing except his game. It would be absurd to call a man selfish for protecting his king in a game of chess, or to say that he was actuated by purely egoistic motives in so doing. It would be equally absurd to call a cricketer selfish for protecting his wicket, or to say that in making runs he was actuated by egoistic motives qualified by a secondary concern for his eleven. The fact is that he has no conscious motive whatever, and is wholly intent on the complex feat of taking the ball. If you want to know whether he is selfish or unselfish you must consider the whole organisation of his life, the place which chess-playing or cricket takes in it, and the alternatives which they open or close. At the moment the categories of egoism and altruism are irrelevant.
And yet this analogy of the game will further explain the obstinacy with which the phrase and the idea reassert themselves, that, in matters of business, a man is solely actuated by the desire for “his own advantage.” It is just because we look upon two men engaged in driving a hard bargain (a very small part of the life of a man of business by the way) much as we look upon two men who are playing a game. Each is intent upon victory, that is, upon raising his score against the other’s, and in this sense the man who has driven a close or a hard bargain is certainly intent on securing an advantage, and we call it “his” advantage, because he is struggling to gain it, though it may in the final instance be the advantage of a client or a ward in which he has either an indirect share only or no share at all. Once more, then, if
tu are engaged in any transaction, whether egoism or altruism furnishes my inspiring motive, or whether my thoughts at the moment are wholly impersonal, the economic nature of the action on my side remains undisturbed. It is only when tuism to some degree actuates my conduct that it ceases to be wholly economic. It is idle, therefore, to consider “egoism” as a characteristic mark of the economic life.
Nor is it easy to make much of the apparently more reasonable saying that the economic relation (or the economic motive) is unmoral or morally indifferent. In a certain sense, of course, this is true; and we shall have to bring out the full extent of its truth under paragraph (
b). Any relation into which I enter for the fulfilment of my purposes may, in a sense, be called unmoral, inasmuch as it is a means and not an end. But if by unmoral we mean unaffected by moral considerations, or not subject to moral restraints, then the economic relation is no more unmoral than the relations of friendship, the relations of sex, the relations of paternity, or the family relations generally. There is no actual or conceivable community in which the economic relations are not habitually subject to the control of moral principles. There are, of course, immoral men who neglect some, or all, of the moral restraints and principles usually acknowledged; that is to say, it is possible to behave immorally in any relation of life, including the economic relations; but both law, and personal honour, and acknowledged ethical principles place restraints, more or less effective, on our conduct in the economic relation, and dictate the conditions under which we may enter it.
It may be urged in the abstract that, since every man should be the potential object of our direct interest and benevolence, a relation which is expressly defined by the absence of any such direct interest must be in its nature unmoral, or even immoral. But this position can hardly be maintained. The limitation of our powers would prevent our taking an equally active interest in every one’s affairs, even if they were all equally worthy, and it may well be that the person with whom we have entered into economic relations is one of the last whom we are bound to consider. When we are inclined to assert the unmoral, or the immoral, nature of the economic relation, we are often thinking of cases in which, for example, a man makes a fortune while he is giving starvation wages to his employees. We think it brutal callousness on his part to be in such close relations with persons whose human claims are so entirely ignored, without being stirred to active sympathy with them. That a man should be in constant relations with such pitiable people, and yet not pity them, we may rightly think shews that his heart is hardened. But we forget that the relation is quite as completely economic on the side of the employees as it is on the side of the employer. They, too, are getting their living out of a man without any direct consideration of his interests, or desire to further his purposes. And we do not blame them. We probably think that he is one of the last persons in the world that they are bound to consider. It is not because the relation is economic that we condemn the man, but because his conduct in that relation strikes us as callous. The very ground, therefore, on which we condemn the employer, but not the employee, is that the economic motive, like the animal appetites, for example, in itself neither makes us moral nor excuses us for not being so. In other words, the economic relation is unmoral only in the same sense in which family affection is unmoral. Family affection may, and often does, urge men to every kind of injustice, selfishness, and even fraud and cruelty, because it does not in itself secure the observance of those moral restraints to which it ought to be subject. To say that the economic relations, or even the economic forces, are unmoral, is in one sense perfectly true, and in another sense entirely false, and in the sense in which it is true it is in no special way characteristic.
b) We have now seen that the taint of inherent sordidness which attaches itself in many minds to the economic relation, or even to the study of it, is derived from a faulty conception of its nature. But, on the other hand, the easy optimism that expects the economic forces, if only we give them free play, spontaneously to secure the best possible conditions of life, is equally fallacious, and even more pernicious. It is, indeed, easy to present the working of the economic forces as wholly beneficent. Have we not seen that they automatically organise a vast system of co-operation, by which men who have never seen or heard of each other, and who scarcely realise each other’s existence or desires even in imagination, nevertheless support each other at every turn, and enlarge the realisation each of the other’s purposes? Do they not embrace all the world in one huge mutual benefit society? That London is fed day by day, although no one sees to it, is itself a fact so stupendous as to excuse, if it does not justify, the most exultant pæans that were ever sung in honour of the
laissez-faire laissez-passer theory of social organisation. What a testimony to the efficiency of the economic nexus is borne by the very fact that we regard it as abnormal that any man should perish for want of any one of a thousand things, no one of which he can either make or do for himself. When we see the world, in virtue of its millions of mutual adjustments, carrying itself on from day to day, and ask, “Who sees to it all?” and receive no answer, we can well understand the religious awe and enthusiasm with which an earlier generation of economists contemplated those “economic harmonies,” in virtue of which each individual, in serving himself, of necessity serves his neighbour, and by simply obeying the pressures about him, and following the path that opens before him, weaves himself into the pattern of “purposes he cannot measure.”
But we must look at the picture more closely. The very process of intelligently seeking my own ends makes me further those of others? Quite so. But what are my purposes, immediate and ultimate? And what are the purposes of others which I serve, as a means of accomplishing my own? And what views have I and they as to the suitable means of accomplishing those ends? These are the questions on which the health and vigour of a community depend, and the economic forces, as such, take no count of them. Division of labour and exchange, on which the economic organisation of society is based, enlarge our means of accomplishing our ends, but they have no direct influence upon the ends themselves, and have no tendency to beget scrupulousness in the use of the means. It is idle to assume that ethically desirable results will necessarily be produced by an ethically indifferent instrument, and it is as foolish to make the economic relation an idol as it is to make it a bogey.
The world has many things that I want for myself and others, and that I can only get by some kind of exchange. What, then, have I, or what can I do or make, that the world wants? Or what can I make it want, or persuade it that it wants, or make it believe that I can give it better than others can? The things I want, if measured by an ideal standard, may be good or bad for me to have or for others to give; and so with the things I give them, the desires I stimulate in them, and the means I employ to gratify them. When we draw the seductive picture of “economic harmony” in which every one is “helping” some one else and making himself “useful” to him, we insensibly allow the idea of “help” to smuggle in with it ethical or sentimental associations that are strictly contraband. We forget that the “help” may be impartially extended to destructive and pernicious or to constructive and beneficent ends, and moreover that it may employ all sorts of means. We have only to think of the huge industries of war, of the floating of bubble companies, of the efforts of one business or firm to choke others in the birth, of the poppy culture in China and India, of the gin-palaces and distilleries at home, in order to realise how often the immediate purpose of one man or of one community is to thwart or hold in check the purpose of another, or to delude men, or to corrupt their tastes and to minister to them when corrupted.
Again, amongst the means that I control may be the vital powers of others, over which I have acquired legal or illegal power. The instances, to take a few at random, of child labour bargained for by parents and manufacturers early in the last century, the history of the slave trade and of slavery, the system known as the “white slave” traffic, with which the advanced civilisations are at last attempting to grapple, but which still recruits that industry in which the wages of shame and oppression are paid and received night by night in every great city of Europe, the exploitation of the rubber industry in the Congo State, and the like, break in with a lurid light upon the idyllic scenes of our imagination. These are amongst the ways by which and the things to which we “help” each other under the potent pressure of the economic relation. The catholicity of the economic relation extends far enough in either direction to embrace both heaven and hell, and to suggest to each that its own ends may be best served by an
ad interim devotion to those of the other. It is strange that so many economic writers, while attempting formally to base their science on an exclusion of ethical motives, have at the same time systematically enlisted the ethical sympathies by illegitimately exploiting the associations of such phrases as “useful work,” “mutual advantage,” and “the common good.” It is no doubt as easy to exaggerate as it is to ignore such deplorable facts as those we have just touched upon, but the point on which we must insist is that if the constructive movements in society dominate the destructive ones, or if there is any progress towards a more worthy or more desirable life in civilised communities, it must be because individual and collective ends are prevailingly harmonious and worthy; for the economic organisation of society in itself does not in any way discriminate between worthy and unworthy ends, and lends its machinery to all who have any purposes of their own and any power of furthering the purposes of others.
But even assuming that human purposes in the aggregate are wholesome and worthy to be furthered, the economic organisation of society, regarded merely as a means to an end, has certain great disadvantages that must be taken as a set-off, as far as they go, against its advantages. This brings us to the very heart of the problem of civilisation. We have seen that it is the essence of the economic organisation of effort that it tends to sever the direct connection between means and end; and since it is the end which interests us, this tends to sever our daily actions from direct connection with that to which they owe their interest. The man who pursues his immediate objects indirectly may effect great economies of effort and secure a wider command of the things he consciously wants, but he may also lose in breadth and variety of faculty. He may touch the realities of life at fewer points, and may have a less vivid sense of the significance of things and less joy in intercourse with them, than if he had pursued his objects more directly. It does not follow that the way that leads most quickly to the goal, or that leads to the most desired goal, is the pleasantest or most profitable road to travel. There is all the difference between the method and spirit of travellers who are constantly impatient to “get to their destination” and of those who taste every incident and prospect on the way, with the undersense of the goal animating and colouring the whole. The latter are, so to speak, “always there,” the former are for ever hastening to “get there.” This will be felt by any one who has cultivated the varied crafts involved, for example, in making a homestead on a bare heath or an almost naked bit of rock, working with his own hands and contriving his own resourceful economies of material. Again, a keen satisfaction is experienced by any set of persons banded together for a common object, in bringing their faculties directly to bear upon their purpose. The artisans in a northern manufacturing district who, in vivid realisation of the significance of spiritual treasures which they hold in common, seek to give their idea a local name and habitation, and so to assert its hold upon others, will love their meeting-house if they have built it out of their savings, but they will love it yet more dearly and will take a still keener joy in raising it if the stone and timber work has been done with their own hands. A religious community in America, approximately self-supplying and self-sufficing, may lose much that we value, but it assuredly gains something by the deepened communal sense that results from the direct bearing of every effort on objects dear to every heart; and in every philanthropic or missionary enterprise those who give time and work are always felt to be nearer the centre of the movement than those who give what is well described as the “support” of money contributions. When a man directly works at his own mechanical craft for a cause which he loves, or gives professional services without charge, he is always felt to be more closely associated with the work than if he only “subscribes” to it, more closely even than if he extracts subscriptions from others by means of a benefit performance in his own particular line.
The contemplation of a whole society based on minute division of labour gives a wider scope to these and similar reflections. It may be true that too much has been said of the evils incidental to the division of labour in narrowing the direct capacities and interests of mechanical and intellectual specialists, and there has doubtless been exaggeration, and in some cases perversity, in the regrets that such considerations have provoked. Compensations even in the work itself, as well as in the enlarged opportunities of enjoyment, culture, and expansion outside it, have been neglected. But if we have little sympathy with those who declare the savage state superior to the civilised, yet any one who has watched the transition of a civilised but primitive community, in which division of labour has not been carried to a high point of elaboration, into a more advanced industrial type, must have had deep searchings of heart as to whether the gain in command of material comfort and external refinement is an adequate compensation for the loss of direct contact between a man and his environment. And in our own country we cannot trace without regret the gradual disappearance of the “notable” housewife, who could
make such a vast number of things so excellently well. Even if we admit the plea that she can now
get a much greater variety of things, many of them perhaps still better than those she used to make, we are but imperfectly consoled.
And if those who make are not those who use, the Nemesis that waits on bad making is less swift and certain in her stroke. The reward of good work may be snatched by False-Semblant. The art of making promises convincing threatens to supplant that of making performances sound. By the side of the fruitful art of bringing our powers and possessions to the notice of those whom they may serve rises the barren art of so working upon their imagination as to persuade them that they need what we and none but we can give them. Side by side with a wholesome and fertilising emulation in doing, rises a wasteful and desolating competition in professing to do. And at last only an expert can distinguish between the harbour light supported by a small toll on the cargoes it guides to safety, and the light displayed by the wrecker who hopes to pick stray salvage from the wealth he has taught the sea to swallow. And yet the real trouble lies even deeper than this, for some of the chief evils which we bewail in industrial society seem to rise independently of shams and frauds, and to be connected with the very fact of the narrowing of each man’s power to provide for himself, and his dependence for almost all that he needs on others, which is the very nature of elaborate economic organisation. Since he gets others to do everything for him, only in consideration of his doing some one thing for others, it follows that if a change of fashion in the demands of others affects his significance to them, his one power of furthering their purposes may fail him, and leave him utterly destitute of any power to serve himself. How deeply this tells on the complication of economic problems, and even on the confusions of economic thought, will be seen with startling clearness when we come to deal with the market of services.
Yet, again, our study of the collective scale has impressed upon our minds the fact that its objective unity covers an infinite variety of subjective and vital diversity of significance. But if I am interested in furthering a man’s purpose, not for its own sake but as a means of furthering my own, the question to me is not how much the thing I am to do matters to the man for whom I am to do it, but how much the thing that he will do in return matters to me, or those for whom I desire it. The economic forces, then, have no tendency whatever to direct my efforts to the most vitally important ends or the supply of the most urgent individual needs. A shilling represents to me the same power of drawing on the circle of exchange, that is the same power of securing co-operation towards the accomplishment of my purposes, whether it comes from the purse of a millionaire or of a pauper; and therefore the economic forces will press me with equal power into the service of either if each offers me a shilling. When Cobbett brought his half-penny to the stationer or the herring man he brought it to persons who had no particular concern either with his appetite or his education, and who dealt with many other people to whom a herring or a sheet of paper more or less would represent perhaps no appreciable enrichment or impoverishment of life. To the two customers A and B the vital significance of these things may differ by the whole distance between a scarce considered trifle and a matter for tears or for stern and desperate resolve. But the inducements that they offer to the stationer or the herring man to make him further their purposes are identical. Each of them offers a halfpenny, representing a certain definite power to further the purposes of the tradesman, whatever they may be. Thus Cobbett’s want and the want of Sir Gorgius Midas, expressed in each case by the proffer of a halfpenny, exert exactly equal pressures upon the tradesman, as such. One is just as important as the other to him. But from any social or human point of view no limit can be assigned to the superior vital significance of the service rendered to Cobbett. It is true that to each man the herring is worth just a halfpenny. But what is a halfpenny worth to each of them? One of them cannot feel the significance of it at all, and if he gives any heed to it, does so only on general principles, because he knows that it is a representative of many halfpennies which, if not looked after, will establish leaks through which thousands of pounds will ultimately escape. To the other, for its own direct significance the halfpenny is worth prayers and tears. It stands to him for “exultations, agonies.” It is the expression of a deep passion for knowledge, fighting with the profoundest impulses of his animal nature, and his turning it to the paper and ink rather than the herring is a testimony to the might of “man’s unconquerable mind.”
It is incredible how easily all this is forgotten, nay, how superlatively difficult it is to bear it in mind. We shall see presently how the economic organisation of industry draws all free resources and unpledged efforts towards those channels which promise the best remuneration—that is to say, which will put us into the largest measure of undefined command of things in the circle of exchange; and seeing that remuneration is obtained by supplying some one else’s wants, the wants we can get the highest remuneration for supplying are, by a gross (though natural and apparently inevitable) confusion, conceived and spoken of as the most urgent wants. What a chasm is thus concealed we can now perceive. It is, of course, true that if we are dealing with one and the same man, the thing for a marginal increment of which he will pay or sacrifice most is that which he wants most at the margin, but it is a desperate leap indeed to pass from this self-evident truth to the self-evident falsehood that if A will give more for a marginal increment of one commodity than B will give for a marginal increment of another, A is more “urgently in want” of one than B is of the other. Does the extra ruby which the agent of a millionaire thinks on the whole will improve the design of a binding for a manuscript, and for which he therefore gives £50, perform as urgent and socially important a service as 24,000 red herrings or 24,000 hap’orths of stationery applied to the wants of 24,000 Cobbetts, could you find them? One father will spend £10,000 to save the life of his child. Does it follow that his love is ten thousand times as great as that of another father who watches his son dying when he knows that £1 spent on better food and a little change of air might save him?
The leap that would be involved in answering these questions in the affirmative is constantly made in economic arguments. The transition is so easy and so natural from the statement, “efforts will be directed to the point at which they will be best remunerated,” to the statement, “efforts will go to the point at which there is the most urgent demand for them,” and from this to “they will go where they are most wanted”! A whole school of cheerful optimism has been based upon the creed that if every man pursues his own interests in an enlightened manner we shall get the best of possible results, because it will be to his interest to apply his energies where they are “most useful to others.” Yes, but what others? The answer is, “those who already have most of everything else that they want.” This automatic action of the economic forces is at the service of every man exactly in inverse proportion to the urgency of his wants. The very fact that he is in want of everything prevents his giving much for anything, and makes his command of the economic forces light. The very fact that he has abundance of all things enables him to give largely of valued things for the gratification of the slightest impulse, for he is only checking impulses equally slight. The weight that his passing whim can throw into the economic scale is heavier than that which his neighbour can pit against it to save his life. The gospel of economic optimism, in a word, is the gospel, “to him that hath shall be given.” And yet we still hear such phrases as, “if people won’t pay for a thing it shews they don’t want it,” or “under conditions of free exchange, effort is directed to the point at which it is most useful to society.” The appalling depths hidden under this litter of loose thought and language are now revealed to us. The enlightened student of political economy and of society will take care to assume nothing as to the economic forces except the constant pressure which they bring to bear upon men’s action and their absolute moral and social indifference. He will see that it is our business in every instance to endeavour to yoke these forces, where we can, to social work, and to restrain them, where we can, from social devastation; never to ignore them, never to trust them without examination; and no more to take it as axiomatic that they will work for social good, if left alone, than we should take it for granted that lightning will invariably strike things that are “better felled.”
The contention that whereas the economic forces are in themselves’ strictly unmoral they are nevertheless necessarily beneficent in their effect, collapses when we examine it. But nevertheless it contains a certain residuum of truth, which we shall do well to consider. Given the whole existing conditions, there is undoubtedly a presumption that any man who voluntarily enters into any economic relation sees his advantage in doing so, and is better off than he would be if he were debarred from it, all other things remaining equal. Thus the most miserable toiler at starvation wages is presumably better off than if he were unable to obtain any employment or wages at all. And this consideration should check such too facile statements as that the moral responsibility for the condition of the most wretched workers lies with the man who employs them. If he merely ceased to employ them because the present relation was too painful to his moral and social feelings, their latter state presumably would be worse than their former; and we should see that the economic relations into which he had entered with them were beneficent in their effect so far as they went, the only trouble being that they did not go far enough. There is a truth, then, in the contention that, given the position of these pitiable persons, the possibility of economic relations spontaneously alleviates it; but when we ask the further question, how come they to be in the position in which such a relation can be acceptable to them, we see how far the economic forces are from being able spontaneously to solve the social problem.
c) The attempt accurately to determine the nature and action of economic forces must already have impressed upon the reader’s mind the fact that it is by no means necessary, or even normal, for the economic relation to exist in isolation. Other relations combine with it and intrude upon what is usually regarded as its special domain; and it makes incursions into regions of activity where we should not at first expect it. It is quite true, for example, that our housewife’s main reason for entering the market-place at all, and for dealing with this man rather than with the other when she is there, is probably not to be found in any consideration of how her action will affect the stall-keepers with whom she is dealing; yet such considerations may surely be present, and may, within certain limits, be effective. In various degrees she likes or dislikes, pities, envies, or disapproves the person with whom she deals or does not deal. Because a man goes to the same place of worship that she does, or because she has been taken by the curly head or the dimpled smile of one of his children, or because his wife has just been confined, or because she knows he has recently had bad luck, or because he is good to his old mother, or because in his unofficial capacity he has shewn her some courtesy, or because she believes him to have voted straight at the last election, she takes an interest in him, and is actuated to a certain limited extent by her good-will to him, and enters upon transactions with him that she would not otherwise have found quite advantageous enough to tempt her. If she can get nearly what she wants from him, and for the same price could get exactly what she wants from a man whose religion is anathema to her, whose manners offend her, and the thought of whose ostentatious prosperity is unpleasant to her, she may deal with the man she is interested in and with whom she is in sympathy, both in order to give herself the pleasure of dealing with one she likes, and to spare herself the discomfort of dealing with one she dislikes, and also from a genuine desire to further the interests of the one man and a (perhaps unacknowledged) dislike of the thought of contributing to the other man’s offensive success. When at home, on the other hand, she is by no means always considering the relative importance of the wants she satisfies on their own merits. There may well be some inmate of the house whose wants she really regards as quite trivial, but to whom she scrupulously attends because he will make himself so disagreeable if they are neglected, or because he will do something she wants him to do, or leave undone something to which she objects, if he is put into a good humour. In providing for his wants she regards his feelings merely as a step towards the attaining of other ends, positive or negative, and not at all as having any significance in themselves. Her relations with him, therefore, are of the same order as if they were economic. And again, in most families there are various persons who are to some extent directly included in the communal sense of fellowship and immediate interest and benevolence, and are also to some extent regarded as a means to the end of keeping the household in working order on a certain scale and in a certain style. Such may be old domestics not quite worth their wage, or grown-up children who contribute to the household expenses, or paying guests who are also friends or relatives. In short, the more we reflect upon all these matters, the more shall we convince ourselves that the motives actuating us in our dealings with our fellows are frequently, if not generally, far from being unmixed, and that economic and non-economic relations are perpetually intertwined.
And even if we originally enter into some relation on purely economic grounds, human and non-economic relations may easily graft themselves upon it; for although the carpenter or the doctor makes a standing offer to further, in certain ways, the life purposes of indifferent and unknown persons as a means of furthering his own, yet, when he has once entered, with any one, into the relation that this service involves, he necessarily finds himself studying his wishes, and endeavouring to accomplish his purposes, and so he gradually acquires an independent interest in his well-being; and though the relation remains at its foundation economic, non-economic materials will be more or less largely built into the superstructure.
We may note that this natural tendency on the part of economic relations to ally themselves directly with humanities acts most easily in one direction. The man who gives commodities or services in return for money is called into immediate co-operation with certain specified purposes of the man who pays him, but on the other hand the man who gives money in return gives only the generalised and undifferentiated command of things and services to the man he pays, and therefore he is not made the partner of his life in any definite and specific way. The man who gives money has already made his choice of the particular way in which his purposes are to be furthered, and he calls the other into direct fellowship with himself in its execution; but the particular purposes which the other will advance by means of the money he receives are still unspecified; for the man who receives money does not declare the services or commodities he desires until he comes to deal with others to whom in his turn he pays money, and whom he calls into the direct and conscious furthering of specific purposes of his own, putting them in their turn into a position to acquire unspecified co-operation from persons unnamed. It is true, of course, that there is a human relation on both sides; but its humanities develop more naturally and more directly on the side of the man who is paid than on the side of the man who pays. This has nothing to do with the relative wealth or poverty of the two. The tailor may naturally take a direct interest in the appearance of his customer, primarily for his own credit, it may be, but secondarily because he is called upon to participate in and to further a specific purpose of his customer; but the customer is called upon to render no direct and specified service to the tailor, and at most has merely a generally benevolent or human interest in him as an individual with whom he has dealings. In the same way, the doctor, the lawyer, and, most of all, the minister of religion, is called upon to enter directly and specifically into certain branches of the lives of the people who pay him. He can see exactly where his action touches them, and can identify his individual contribution towards their well-being. This must almost inevitably super-induce upon the business aspect of the connection a disinterested concern in the welfare of those he serves. But those who pay him his fees, or contribute to his salary, while enabling him, within stated limits, to do and to get anything that he desires, are not called upon to exercise judgment, fidelity, and tact in directly forwarding specified purposes of his life. They are not participating with him in specific enterprises and achievements. They cannot identify the particular point at which they are personally and individually helping him, and so they feel that on his side the relation is more human than on theirs. This explains the touching circumstance that in such cases a sense of gratitude and obligation often remains when ample money payment has been made. The feeling still remains that personal and specific things have been received and nothing personal or specific has been returned; a feeling that sometimes seeks relief in presentations of things that can be specifically identified as personal and direct contributions on the part of the givers to the well-being of the receiver, or the furthering of some known and recognised purpose of his.
There are, of course, other conditions which may help to determine the free or impeded growth of personal and human relations on a basis of business. In the case of the employer and the hands in a workshop it may well be that the employer has a larger sense of social responsibility and a more direct realisation of the vital significance of what he gives to his men than they can have of what they give to him, though the one is money and the other specified service. This, however, is largely a matter of personality. The relation itself is still a direct challenge to the man employed to do faithfully a specific thing for the man employing him, whereas all that the employer does is to put the man he employs in a position to secure the unspecified co-operation not of himself, but of others, in the fulfilment of his purposes.
Thus, where there is high moral character on both sides, the employed person, whether a doctor or a factory hand, is called upon for specific services which may breed devotion to his work and to those for whom he does it; whereas the person who employs can hardly pay fees or wages devotedly, however much esteem, gratitude, or affection he may feel. What the earner of money gives, even if it remains fundamentally a means of accomplishing his own purposes, is naturally affected by a sympathetic interest in the purposes of others. What he gets is much more completely dependent on his purely economic significance, that is to say, on the significance which others attach to his services for purposes of their own. He may give with a sense of personal interest in what he is doing for another; he will get only what he is worth. And he wishes this to be so. An employer is pleased if his workmen take a disinterested pride in their work and in the credit of the firm. We are all pleased if our fishmonger or our shoemaker seems to consider our personal tastes, not only because he wishes to retain our custom, but also because he is glad to serve us. But the man who is paid does not wish to receive money from others because they are interested in his well-being or consider his life a beautiful one. He wishes to receive it because he is worth it to them—that is to say, because they are interested in purposes of their own, and need him to forward them.
Even where business transactions are of a more impersonal character, as in the wholesale markets or on the stock exchange, and where there is no permanent personal connection as there is between the employer and the employed, the picture of the business man engaged in pushing his own advantage to the utmost, without the least concern for others, and eagerly seeking to get as much and to give as little as possible, is to a great extent a fancy portrait. Opinions differ as to whether the average successful man of business is scrupulous or unscrupulous, but most men agree that he is not merely grasping. He has a certain large-hearted sense of common interest alike with his clients and his rivals, and does not desire always to push every advantage absolutely as far as it will go.
Nor must we lose sight of the fact, only too obvious and undeniable, that these human relations are not all of one kind. They may constitute a negative as well as a positive consideration. The economic relation between employer and employed is too often not supported and softened by the human relations that grow out of it, but strained and embittered by them. And if it is possible that the work I undertake for others, for the sake of furthering my own purposes, may enlist my direct interest and sympathy, it may also be that pressure of circumstances forces me into a position in which, in order to fulfil my own purposes, I lend myself to purposes of others which I regard with grave moral disapproval, as involving some kind of fraud or false pretence, or with deep social compunction, as involving misery or degradation to others; or which, at least, appear to me frivolous and unworthy, calculated rather to enervate the character and dissipate the energies than to build up sound humanity. Hence every man who lives in such a society as ours may be liable to a dismal sense of incongruity between the things for which he cares and which he seeks to realise for himself, and the things that he is doing for others and actually enabling them to realise; between the life he contemplates as an end and the life he actually furthers as a means. No man can regard himself as having solved his personal problem of life in an even approximately satisfactory manner until he has brought his business and his private life at least into such a degree of harmony that there shall be no permanent strain and conflict between the general significance and tone of the kind of life he desires to live, or at least the (much wider and more varied) kind of life which he can cheerfully contemplate other men as living, and the kind of life he is helping other men actually to live. It is obvious, therefore, that in choosing his business or profession a man is not necessarily or even probably moved by merely economic forces. He may think of his profession not only as a means of earning money but also as an occupation, not only as a means of living but as part of life; and he may be content with the prospect of a smaller income if his occupation will either be acceptable to him in itself, or will bring him incidental opportunities of directly gratifying his tastes and realising his general purposes in life.
It is impossible to exhaust the combinations of the several considerations that habitually affect our conduct, but the following rough analysis may be found useful. If we are engaged on any piece of work, there is the pain or pleasure of doing it as a mere occupation; there is further the sense of the importance or significance of the thing itself when done (which naturally reacts on the pleasure or pain of doing it); and there is the command of commodities and services of which it puts us in possession. Thus a man may be engaged in designing or executing elaborate implements of war, say torpedoes, and he may take keen delight in the problems which face him, in the experiments and tests which he applies, and in the gradual overcoming of difficulties and perfecting of processes. At the same time he may believe in the reduction of armaments, and may regard the policy which his art subserves as a cruel infatuation. Or he may be a sincere believer in the policy of great armaments, but may be executing an order for a foreign government, because he could not persuade his own of the value of his apparatus. In either of these cases his desire that the thing he is doing should be done is a negative quantity, whereas his pleasure in doing it is positive. On the other hand, his task may be an arduous one, which does not suit his taste, and which demands excessive and exhausting effort from him, or it may be so monotonous and unintelligent as to make the greater part of his life mere drudgery; and yet he may think it exceedingly important that the work should be done. The case of a clerk in the office of some philanthropic institution with which he is in hearty sympathy may serve as an illustration. Or perhaps his work is a pleasure to him, and at the same time he thinks it important that it should be done, whether by himself or by another. A lecturer who loves his subject and enjoys the intellectual effort of expounding it and the sense of rapport between himself and his hearers, and who at the same time believes that the study he is spreading is essentially life-giving and life-raising, so that he would rejoice in the work being done, whoever did it, may serve as an illustration of this.
But all of these alike may be paid for their work; that is to say, in consideration of doing it they may be put into a position to further the general purposes of their lives, whatever they may be, to marry, to travel, to keep a luxurious table, to patronise the turf, to make a figure in the world, to buy books, to gather information, to further philanthropic or religious movements, to endow research, or to patronise art, all on the scale of their 15s. a week, or £1500 a year, as the case may be. Now, in all these cases the relation is complex and the motives are concurrent. The economic forces are reinforced or counteracted by the others, and the resultant would be different if any one of them were modified. He is in the happiest position whose work is at the same time pleasant in the doing, valued for its direct result, and indirectly helpful to all his own general purposes; or in more familiar terms, he is happiest who is paid for doing what it is a pleasure to him to do and what he desires should be done. In such a case there is a happy coincidence between the direct accomplishment of one purpose and the indirect accomplishment of others. The very thing for which we should have been willing, if necessary, to forgo some satisfaction or incur some pain we actually secure by doing something else which is itself an independent source of satisfaction to us.
A great part of the work of many literary men and artists of every kind is, or may be, of this kind; and so may any intelligent handicraft, up to a certain point. The observation of this fact has given rise to a Utopian idea that all irksomeness might ideally be expelled from life; and some favoured individuals seem so nearly to reach this ideal as to furnish some kind of pledge of its actual possibility. But a little reflection will shew that this is inherently impossible; for if we really care for the purpose of our work, that is to say, if independently of the pleasure of doing it (which would have been secured if the effect were instantly destroyed), we also care for the effect itself, it must follow that so long as that effect is imperfectly accomplished we shall be willing to make sacrifices or to endure weariness for the sake of its further accomplishment. That is to say, no man will be content always to stop doing whatever he is engaged upon as soon as he ceases to enjoy it, except the man who has no real care that the thing should be actually done at all. And this will explain why even that man, the general tenor of whose life seems to have secured an almost perfect coincidence between his tastes and his purposes, and who enjoys every portion of his normal day to the full, will yet (unless he can hermetically seal his heart against all appeals) find that he has perpetually to break in upon the life he loves in order to meet personal or public claims which impose comparatively distasteful tasks upon him; and this because they tend to the accomplishment of more urgently needed results than those to which the daily labour of his life is ministering. He may long believe that all this is due to a series of vexatious accidents, and that presently he will be left undisturbed; but reflection will shew him that it is inherent in the conditions of human life that the man who cares for anything will often have to relinquish something else that he cares for in order to secure it, and that while he is himself highly fortunate in finding the main supports and adornments of his life spontaneously conferred upon him simply for doing that which it is his delight to do, there yet remains a margin of unsupplied wants, or unfulfilled purposes, or neglected claims, or undeveloped opportunities, the provision for which must trench on his loved occupations, or must be met from the proceeds of excess of work that converts it into exhausting and wearying toil. No man can escape doing things he does not enjoy for their own sake, or doing more of them than he enjoys, unless he is indifferent to all the unsatisfied purposes or potential reliefs or delights, whether of himself or others, to which they might minister.
d) We have now abundantly illustrated from every side the fact that the economic forces cannot be assumed to act in isolation. But it does not follow that it is impossible or illegitimate to make a separate study of them. It may be both legitimate and desirable to make an isolated study of forces that we never for a moment suppose to act in isolation, provided that the action which our isolating study reveals really comes into play and tells at its full value, though always in combination with other forces. In order to justify such an isolated study it is sufficient that the action revealed should be real. The stock example of this isolation is the tracing of the ideal course of a projectile on the supposition that the direction and force of gravitation are constant, that there is no resisting medium, and that the projectile itself is a “material particle” without extension. Not one of these hypotheses ever corresponds with the fact, and the last of them is self-contradictory; for a projectile must have extension. The second ignores a consideration which always enters into every practical application of the theory; and the first slightly falsifies the conditions under which the force of gravitation always acts; so that even if that force acted alone, which it never does, and acted on a point, which it never can, it would not make that point trace the true parabola which the theory of projectiles yields. And yet the practical study of projectiles has been incalculably assisted by the working out of this hypothetical gravitation, acting upon a body that cannot exist, in the absence of a medium which is always present. It will be instructive to examine this example further, and in doing so we must make a careful distinction. The hypothesis that the action of gravitation is constant in direction and magnitude is positively false, and it vitiates the result; but it departs so little from the truth that the error it produces is less than the finest observation could detect or rectify; so that in a practical problem the result obtained is indistinguishable from the true result. The other two hypotheses, that the projectile has no extension, and that there is no medium, are negatively false, for they assume the absence of what is really present; but in isolating for examination those aspects of the problem which are independent of the bulk of the projectile and of the action of the medium, they guide us to an actual result, though one which never reveals itself alone, since it always occurs in combination with other results derived from other factors.
We may take this opportunity, before proceeding further, of trying to clear up certain confusions and obscurities that attach to the words “theory” and “theoretical,” particularly in contrast to “practice” and “practical.” Broadly, we speak of a theoretical treatment of a subject whenever the investigation proceeds by inference rather than by direct observation. This will be the case when we are dealing with generalised facts and reach general conclusions, or whenever our data or results are not open to direct observation. And this latter case may arise, because our data never actually occur in nature. For instance, our datum may be that the earth is revolving round the sun in space without being influenced by any other body. This would be a hypothesis, but not a fact, and the conclusion about the perfect elliptical orbit of the earth would not be theoretically true, because the datum is not. The conclusion would be theoretically and truly derived from the datum, but would not be theoretically true as a fact. Much confusion in the popular mind is due to the careless use of “theoretically” as equivalent to “according to the hypothesis.” Or it may be that our data do occur in nature but never in isolation, whereas our treatment isolates them. Our conclusions will then be true both theoretically and practically, but their isolation will be hypothetical. If we announce the isolated result as something that will take place “theoretically” but not “practically,” we are using loose language; for theory, while isolating the data and the results, does not assert that they “occur” in isolation, but the contrary. It is therefore theoretically true that the isolated data would involve the isolated result, but theoretically false that the result will actually occur in isolation. There is a distinction, but not a contrast, between theory and practice. In fact it is never the case that anything is theoretically true but practically false; though a statement may be practically true but theoretically false, if it neglects quantities so small that they evade observation, though their existence can be inferred.
The theoretical method we are considering at the moment is that of hypothetical isolation. It may be illustrated by what is sometimes called in dynamics the principle of Superposition. According to this principle any force which, acting on a body, would produce a certain result, were that body at rest and were no other forces acting upon it, will actually produce its full effect (that is to say, will tell in exactly the same direction and to the same extent), whatever may be the motion of the body at the moment and however many other forces may be acting on the body at the same time or may subsequently be brought to act upon it. Thus, if a hockey ball receives an impact which would make it travel 100 feet due north in a second, if it were at rest at the moment of the blow, then whatever direction it is moving in when it receives it, or whatever impacts it receives afterwards, it will be 100 feet further north at the end of a second than it would have been had it not received this impact. For instance, if it was already travelling at the rate of 50 feet a second due west when it received it, then at the end of a second it will be both 50 feet further west and 100 feet further north than it was at the beginning. Or if a ball travelling north at 100 feet a second experienced an impact which, had it been at rest, would have sent it 50 feet south in a second, at the end of the second it will be 100 feet further north than it would have been had it not been in motion when it received the impact, and 50 feet further south than if it had not received it. In the first case it would have been 50 feet south of its original position, in the second 100 feet north of it. As a matter of fact it will be 50 feet north of that position. Thus in every case, whether the force acts in the same direction as the motion or in the opposite direction, or at right angles to it, or at any other angle, it will produce its full effect. Similarly, if two or more forces act simultaneously, their joint effect is obtained by allowing for the full effect that each force would produce if acting separately, and then adding them all together.
There is nothing inconsistent, therefore, and nothing unpractical, in theoretically isolating the effect of a force that usually or perhaps always acts in combination with others. Note, therefore (and this is an important though apparently subtle point), that the hypothesis or supposition that a force does act alone is a very different thing indeed from the theoretical study of it in isolation. The very necessity for studying it “theoretically” may be due to the fact that it is never accessible in isolation, and our interest in it may be wholly due to its practical effect in combination with other forces. It would be false to say that “theoretically” it acts alone; but true to say that for theoretical treatment we must isolate it. We conclude, therefore, that it is open to us to consider whether there is any advantage in an isolated study of the economic forces, though the hypothesis that they always or generally act in isolation would be an absurd one. But note that the analogies adduced from physical science can be pushed no further than to the single point of a possible justification of isolated treatment. The simplicity, uniformity, and mutual independence of the forces with which dynamics deal fail us on the field of psychology.
Let us suppose, then, that, for some reason, a man desires money; that is to say, desires an increased command of services and commodities in the circle of exchange. Then if an action he is contemplating will bring him money, this fact will form a consideration, and if appreciable will tend to affect his conduct, whether the action in question is attractive, repellent, or indifferent to him on its own merits. We have admitted that the inter-relation and inter-connection of the motives that determine a man’s conduct are too intricate and complex to enable us to imitate on the field of practical life the exact formulæ of mechanics; but it is safe to say that if a man wants money, then the fact that a certain open alternative will secure him money will be a consideration (though possibly a negligible one) in favour of that alternative. This is indeed merely to say that a man would rather have what he wants than not. Thus if any new order of relations between men becomes possible whereby those who enter into it can obtain a given command of things in the circle of exchange, there will be a reason for entering into those relations, which will tell for what it is worth, whether the relations themselves are attractive or repellent to the tastes, the morals, the habits, or the impulses of some or all of the members of the community affected. And any modification in those or in other existing relations will modify the forces that determine conduct in that community, whatever other forces may be present or absent. If, then, by isolating the consideration of the economic forces, we can gain any insight into the general principles on which they may be expected to influence a man’s conduct, we need not be deterred from pursuing such a course by the fact that it is never safe to assume such isolation as a fact.
Closely bearing on the considerations just urged is another principle which must be expounded here. It is the principle of “Continuity.” If you were to take the 1000 persons who happened to be nearest to a certain point on the earth’s surface at a given moment, and then arranged them in order of height, you might rely, in general, on finding no great differences between any individual and his right-hand and left-hand neighbours. Possibly there might be an abnormally small baby at one end and a giant at the other, considerably shorter and taller, respectively, than their neighbours; but after passing the first few individuals at either end you would find the difference as you passed from one to another exceedingly small. That is to say, when you are dealing with any large number of persons you may assume that whatever reasonable standard of height you may fix, some of those who are below it will be very little below, and some of those above it very little above, so that if you had taken the standard a very little higher or lower some individuals would have been below who are now above it or some above who are now below.
Now we have already examined the economic forces closely enough to realise without difficulty, that if a large number of persons are engaged in any profession, there will be some of them who, on the balance of considerations, are only just retained within that profession, and others who are only just kept out of it. So that if any of the conditions affecting this occupation are altered; if it comes to be thought either more or less dignified or honourable than it now is; if the conditions under which it is pursued are so changed as to make it either more or less easy, interesting, bracing, or agreeable to the average man, or more pleasant and so forth to some and less so to others; or if its indirect advantages (that is to say, the salary attached to it, which means its power of enabling him who pursues it to get his other purposes accomplished by so doing) are changed; then some persons who are now in it will go out, or some who are now out of it will come in, or some who would have prepared to enter it will not do so, or some who would not have prepared to enter it will. Possibly two streams, one each way, will be set in motion. This, observe, is not a speciality of the economic forces, but is common to them with all others. Thus, even if the economic forces never act in isolation, yet the psychological analogue of the law of Superposition, combined with the principle of Continuity, enables us to feel the utmost confidence that any modification in the economic conditions of life will produce its full effect. If we study these effects in isolation we shall be studying real phenomena which actually enter, though not in isolation, into practical life.
It may help to give precision to these ideas if we return to one of our former examples. The actual and potential purchasers of new potatoes in a given market may be actuated by all kinds of partialities, prejudices, and traditions, but if one man were selling at 1¼d. per pound, whereas others were selling at 1½d., the difference in price would be felt as a reason, if not necessarily a sufficient reason, by all the marketers who noted the difference, for dealing at the cheaper stall. And if there were many of them some would already be so nearly dealing with this man in preference to some other that the ¼d. difference would determine them. Or again, if the price in the whole market passed from 1½d. to 1¼d., though there would be many who bought just the same quantity that they would have done at the old price, yet there would be sure to be some, already just on the balance between a larger or a smaller quantity, whose purchases the fall in price would increase. Thus where large numbers are concerned we may assume a sensitiveness which we cannot assume in the case of individuals. We may be sure that the smallest appreciable cause will produce an appreciable effect. The irregularities on individual scales will compensate each other on the collective scale; and we may reckon upon any change in the economic conditions producing an effect; and, by study, we may hope to learn something of the nature of this effect, though it always combines with others. If we say that such and such an effect will actually emerge—for instance, that the price of such and such an article will rise, because of such and such a change—we assume in the first place that the force that has come into action is powerful enough to produce an appreciable effect, and in the second place that other forces will remain constant. But as a matter of fact other forces never will remain constant over any lengthened period. Hence the extreme danger and folly of concrete predictions.
But having now vindicated our right to study the economic forces in isolation, and having raised a strong presumption that such a method will throw light upon their action, we return to the question “why should we desire any particular knowledge of the action of the economic forces at all?” The answer to this question is simple and decisive. We have touched upon, though we have not explored, the various ways in which the business nexus may work for the weal or woe of the social organism. And as we can neither destroy the economic forces nor implicitly trust to their beneficence, we shall naturally wish to control and direct, to stimulate or to check their action, to open channels through which they may flow with fertilising effect, and to dam them out from regions that they might desolate. The whole range of factory legislation, the whole scheme of the Poor Law, all acts against the free sale of poisons or of fire-arms, the regulation of the liquor traffic, schemes for a scientific tariff, schemes for the compulsory levying of taxes for communal purposes, are all of them attempts to regulate and direct, to control and supplement, or to stimulate in this direction or check in that, the action of the economic forces; and an indefinite number of movements, such as co-operation in the interests of producers, or co-operation in the interests of consumers, or schemes of profit-sharing, are attempts to educate and enlighten these forces. The housing problem, the land problem, and all the rest, perpetually deal with economic forces. Ruskin’s crusade against interest contemplated a radical change in one of the most pronounced manifestations of the economic force. No one can deny the importance of the practical objects contemplated by these and innumerable other movements and activities. No one can deny the difficulties of the problems they involve. No one can deny the frequency with which results other than, or even opposite to, those contemplated rise, or are alleged to rise, out of action taken. It is clear, then, that the action of the economic forces can in many ways be controlled and modified by deliberate collective action. It is also clear that action taken for this purpose is groping and often blind; and further, that want of clear knowledge of the deeply enrooted nature and the irrevocably fixed boundaries of the facts and forces with which we are dealing causes incalculable waste of social effort and enthusiasm. Surely, then, it needs no further argument to prove that if any essential light can be thrown on the actual nature and the spontaneous action of the forces that we endeavour at every turn to direct, to check, and to control, the mind of man could scarcely be applied to a more august or urgent task than that of elucidating them.
Surely it will help us in our consideration of the problem of starvation wages if we can understand the exact nature of the influence which the economic forces spontaneously exercise in raising or depressing wages; for we shall then better know whether any measure we contemplate for raising wages will have to be carried through in opposition to them or can enlist them as allies. If we are considering whether it is moral or immoral to take interest, and whether an industrial society could or could not be carried on without it, would it not be well as a preliminary if we could gain a perfectly clear and precise conception of what interest is, how it arises, and what it does, so far as the economic forces beget and regulate it? Nor can we have any clear conception of what the housing problem is, or what are the real bearings of any proposed solution of it, until we understand exactly how and why the play of commercial forces has brought about, or contributed to bring about, the existing state of things; or why this play of forces does not spontaneously and unconsciously destroy it.
What gives their immense social significance and importance to the economic forces is that they will always look after themselves. You need not preach to a man or appeal to his imagination, you need not be perpetually reminding yourself of things which you are constantly apt to forget, in order to make him and to make yourself do those things to and for others which you know are the quickest and readiest way of getting what you want done yourself and of getting your own purposes fulfilled. Your own purposes are always with you. You have a direct and precise conception of them, so far as you have a direct and precise conception of anything. To give another man food when you think he wants it, and to keep it away from him when you think he does not, and never to forget his wants, needs a more or less sustained effort, and involves dealings with unknown quantities as to which your speculations are sure not to be accurately true, and may be disastrously false. When you are hungry and want food yourself, it needs no effort of the imagination, no sustained self-discipline, no fallible speculation, to make you aware of the fact.
Therefore, if we can place any socially desirable work under the direct tutelage of these urgent forces, we have made sure that it will be looked after. Saint and sinner alike will desire to do the things whereby they can further their own purposes. We shall then have a driving force, the furnace of which is always at full blast, and needs none of our stoking. Practical philanthropists know this well, and they often surprise and even scandalise their supporters by insisting that their schemes should be “placed on a sound business footing” and be “made to pay.” Naturally; for if I make it a part of any man’s purpose, to which he is willing to sacrifice other purposes, that the housing of the people should be improved, I do well; but if I can shew that by building better houses he can further all his other purposes instead of sacrificing any of them to it, then I have secured general and automatic support for the thing that I desire. We could not in any case afford to waste, even if it were possible to destroy, those forces whose stupendous sweep and energy bear so dominant a part in co-ordinating the efforts of men and carrying on the world from day to day. It will be necessary sometimes to oppose and check them; but what an enormous gain if we can harness them to the social car!
And, in spite of their alertness and insistence, the economic forces cannot be trusted always to find out for themselves those outlets which are incidentally beneficent. For, however bold and alert they may be in seeking passages for themselves, they can never induce those who are not directly interested in the social results we contemplate to incur any risks for their sake. Hence they may be irresponsive, timid, and perhaps blind with the blindness of indifference and lack of sympathy, in the face of many promptings and suggestions which might otherwise reveal to them that the direct road to the accomplishment of their own purposes lies along the path we would have them tread.
There is an indefinitely large field open to those who value the social result, and have insight and courage to take the risks of making experiments. When those who care have enlisted the co-operation of those who do not, the improved order of things spreads and sustains itself. It has come within the range of the economic forces, and can enjoy the incessant and vigilant support which those forces give. There is an ever-growing number of private individuals, or of associations and organised groups, such as those constituted by the Trades Unionists or the co-operators of England, or of governing bodies that have more or less control over the lives and conduct of men, from village councils to the Imperial Parliament, that are or may be earnestly concerned with social problems for their own sake; and it is no matter of indifference whether they have, or have not, a sound knowledge of the action of the economic forces, with which, if they are wise, they will constantly seek alliance in all their reforms, and which, if they have the courage, they will not shrink from checking and controlling, on due occasion and to the due extent.
We shall enter upon an express study of the economic force, then, not because it is an evil thing which we must seek to eliminate, nor because it is a beneficent thing to which we can surrender our lives in serene confidence, but because it is a power ever active, in a world of mingled good and evil, in producing and emphasising good and evil effects; a power which we cannot destroy or lull to sleep, but which in a certain measure we can control and direct; and a power, therefore, which it is of the extremest importance for social well-being that we should understand.
And we shall study it to a great extent in isolation, because, having already elucidated on a broader psychological field the main conceptions, and established the main laws, which regulate its action, we shall now find it possible, and therefore conducive to clearness of exposition, to study the special application of these conceptions and laws to economic problems.