order, rather than its overthrow. It is quite conscious of defects in
its arrangements and knows that its fruits are not all good. It has
never considered the question of the efficiency or inefficiency of the
system as a whole. The older individualistic notions are strong enough
to give an intuitive belief that the theory of the control of industry
by business for profit is essentially sound. But it would eliminate
the bad, patch up the indifferent, and retain the good. It would set up
in the government an external authority which through regulation and
repression would make business interests serve the community. Its faith
is in private enterprise compelled by the State to promote “public
welfare.” Its detail can best be suggested by typical illustrations.
There is, first of all, the attitude of the protestants towards freedom
of contract. They accept the prevailing theory that the relations of
buyer and seller, employer and employé, owner and agent, can safely
be left to the free choice of all concerned. But they point out that
in practice the principle does not give its assumed results. For,
whereas the theory assumes the parties to be equal in their power to
determine the terms of the contract, it is a matter of common knowledge
that employers and labourers occupy unequal bargaining positions.
They would leave relations to be determined by free bargaining;
but, as a preliminary, they would attempt to establish equality of
bargaining power. To that end they would have the contract made by
“collective bargaining” between employers and employés “through
representatives” chosen by each. Moreover, they would use the State
to better the position of the weaker party. Thus legislation has been
passed depriving employers of their right of requiring employés, as
a condition of employment, not to remain members of labour unions.
Although the courts have found such legislation to be “an arbitrary
interference with the liberty of contract which no government can
justify in a free land,” its advocates will insist that their aim has
been only “to establish that equality in position between the parties
in which liberty of contract begins.”
There is, in the next place, a growing opinion among the protestants
that the State is “a moral agent” and should determine the rules under
which business is to be carried on. They point out that in business
there are bad as well as good conditions, that business men engage in
proper as well as in improper practices, and that some activities harm
while others help the community. In many instances the employer finds
it to his advantage to establish conditions which the interests of the
workers and of the consumers require. In others, the elevation of
standards waits upon the pleasure of the most inconsiderate employer.
The prohibition of child labour, the shortening of the working day, and
the payment of a minimum wage may be advantageous alike to labourers
and to the community; yet these innovations involve an increase in cost
and cannot be made against the competition of the producer who will not
establish them. In such cases it is the duty of the State to establish
minimum conditions which must be met by all employers. The imposition
of such standards in no way affects the system under which business is
carried on; for the competition of rival sellers can be just as acute
and just as considerate of the public, if all of them are forced to pay
their employés a living wage, as if they are all free to force wages
down to starvation. Upon this theory the State has established uniform
weights and measures, prohibited the use of deleterious chemicals,
stopped the sale of impure food, provided compensation for the human
wear and tear of industry, and established minimum standards of safety,
health, and service.
There is, finally, a growing opinion that in some industries the
profit-making motive must be superseded by some other. In the railway
industry it has been repeatedly shown that the pecuniary interest of
the management fails to coincide with that of either the owners or
of the shippers. Long ago the determination of charges for service
was put beyond the discretion of the officials. Of late there has
been an increasing tendency to make accounts, services, expenditures,
valuations, and other matters meet standards of public service. When
this has been effected, as it will be, the officials of the roads
will become mere subordinates responsible to a public authority. Then
profit-making as a guide to administration will have given way to an
official judgment of results in terms of established standards. Then
it will be discovered that public control formally rejected has been
achieved by indirection. But many times ere this American opinion has
come by devious paths to goals which its individualism has not allowed
it to regard as quite desirable.
For the moment the medley of opinion here roughly characterized as a
demand for control is dominant. Its proponents are almost as naïve
as the advocates of capitalism in a belief in the essential goodness
of a mythical system of “free enterprise.” They differ from them in
placing greater emphasis upon voluntary associations and in demanding
that the State from without compel business to serve the common good.
As yet they have formulated no consistent theory of economics and
no articulate programme for achieving their ends. Without a clear
understanding of the development of industry and of the structure of
the economic order, they are content to face specific problems when
they meet them. They are far from ready to surrender an inherited
belief in an individualistic theory of the common good.
IV
The changes of the last four decades, which make up “The Industrial
Revolution in America,” have left their mark upon the economics of
the schools. If there was a time when the thought of the professed
economists was a thing apart from the common sense of the age, it
ended with the coming of industrialism. Differ as it may in phrase, in
method, and in statement, the economics in solid and dull treatises
reflects, as it has always reflected, the opinions of the laity. If
there were agreement among the sorts of men who gather at ball games
and in smoking cars, the books on economics would all read alike. But
when the plumber differs from the banker and the scrub woman refuses
to take her ideas from the coupon clipper, it is futile to expect mere
economists to agree. To some, the classical doctrine still serves as
a sabbatical refuge from modern problems. Others, who “specialize”
in trusts, tariffs, and labour are too busy being “scientific” to
formulate general opinions. Still others insist upon creating a
new economics concerned with the problem of directing industrial
development to appointed ends. Each of these schools has a membership
large enough to allow dissension within the ranks.
The revolt against the classical economics began when it encountered
modern fact. Beyond the pale of doctrine taught by certified theorists
appeared studies upon corporations, international trade, railway rates,
craft unionism, and other matters of the newer fact. For a time those
who studied these subjects were content to describe in superficial
terms the results of their observations. But as facts accumulated they
provoked generalizations at variance with the accepted principles of
the older competitive theory. At the same time the rise of a newer
history concerned with development rather than chronology, a new ethics
that recognized the existence of a social order, and a new psychology
that taught that the content of men’s behaviour is poured in by the
environment, together made the foundations of the older economics very
insecure.
For a time this protest found expression only in critical work. The
picture of an economic order as a self-regulating mechanism, peopled
with folk who could not but serve the community in serving themselves
became very unreal. The complexity of industrialism made it hard to
believe that the individual had knowledge enough to choose best for
himself. The suspicion that frequently thought follows action made it
hard to continue to believe in man’s complete rationality. The idea
that incomes are different because opportunities are different led to
a questioning of the justice of the ratings of men in the market. The
unequal division of income made impossible pecuniary calculations in
which each man counted for one and only for one. With these assumptions
of 19th-century economics passed “the economic man,” “the Crusoe
economy,” and the last of the divine theories, that of “enlightened
self-interest.” It was no longer possible to build a defence of the
existing order upon “the hedonistic conception of man” as “a lightning
calculator of pleasures and pains, who oscillates like a homogeneous
globule of desire of happiness under the impulse of stimuli that shift
him about the area, but leave him inert.”
The most immediate effect of this criticism was a change in method.
The older process of juggling economic laws out of assumptions about
human nature, human motives, and the beneficence of competition lost
prestige. It was evident that if the system was to be appraised
the facts must be had. Accordingly a veritable multitude of facts,
good, bad, and mostly indifferent were treasured up. This process of
garnering information soon made it evident that the facts about the
relationship of industry to the welfare of the community were too
varied and too numerous to be separately catalogued. Since only totals
could be used, economics came to rely upon facts presented in the
quantitative language of statistics.
But since facts are not possessed of the virtue of self-determination,
they did not yield an opinion which was very relevant or very truthful.
Their use was for the moment nothing more than a substitution of the
superstition of facts for that of logic. The facts were of value,
because when properly interpreted they gave the story of what the
economic system had done. But without the aid of standards it was
impossible to determine whether it had worked well or ill, whether it
had much or little to give in return for the solicitous concern about
it. It was evident that modern industrialism was developing without
conscious guidance. As long as no goal was fixed it was impossible
to tell whether industrial development was proceeding in the right
direction. As long as we were unmindful of the kind of society we
wished ours to be, we could not appraise its accomplishments. Without
standards all that could be said was that the system had worked as well
as it had worked and that we were as well off as we were well off. The
problem, therefore, became one of judging the system on the basis of
the facts by means of standards.
Thus the newer economics has been of service in stating the problem
with which opinion must be concerned. The “prevailing” economic order
is one of many schemes of arrangements for making industry serve the
purposes of the community. The system has been slowly evolved out
of the institutions of the past, is constantly being affected by
circumstances, and for the future is capable of conscious modification.
How well it has served its purpose cannot be attested by an abstract
argument proceeding from assumptions about human nature and the cosmos.
A judgment upon its relative goodness or badness requires an appraisal
of the facts in terms of standards. These standards must be obtained
from our notions of the kind of society we want this to be. These
notions must proceed from a scientific study of the properties of
things and the needs of human beings. That judgment will be one not of
goodness or badness, but of the relative merits of a very human scheme
of arrangements compared with its alternatives.
The economists are reluctant to pass a judgment upon the prevailing
order. The relevant facts are too scanty and the standards too inexact
to warrant an appraisal of the virtues and the vices of “capitalism.”
They distrust the eulogies of apologists because they do not square
with the known facts. They are not convinced by the reformers, because
they fear that they know as little about their own schemes as they
do about current arrangements. They insist that a general judgment
must be a progressive affair. The system will change through gradual
modification; the larger problem will be solved by attention to an
endless succession of minor problems. Each of these must be met with
the facts and with an ideal of what our society should be. They have
too little faith in the rationality of the collect to believe that
problems can be faced in battalions or that a new order can emerge
as a work of creation. They have little fear for “the future of the
nation,” if only problems can be intelligently handled as they emerge.
Their attitude towards the present system is one, neither of acceptance
nor of rejection, but of doubt and of honest inquiry. Their faith is
neither in the existing order nor in a hand-me-down substitute, but in
a conscious direction of the process of change.
* * * * *
This tedious narrative has failed entirely in its purpose, if it has
not revealed the strength and the weakness of economic opinion in
America. Its merits stand out boldly in the preceding paragraphs; its
defects are too striking to be concealed. The reader has already been
informed; but the writer must inform himself. The essay, therefore,
will close with an explicit statement of some three of the more obvious
characteristics.
First, its most striking characteristic is its volume. In quantity
it contains enough verbal and intellectual ammunition to justify or
to wreck a dozen contradictory economic orders. If, in an orderly
way, opinion became judgment and judgment ripened into the society of
to-morrow, it would stand condemned. For little of it has a practical
consequence and our ways of expression are very wasteful. But it also
affords a harmless outlet for the dangerous emotions aroused by the
wear and tear of everyday work in a humdrum universe. And, if it is
true that we are, all of us, Simians by lineage, this is by far the
most important function it serves.
Second, it is grounded none too well in information and principles.
The ordinary mortal is busied with his own affairs. He lacks the time,
the patience, and the equipment necessary to get at the facts about
the material welfare of the nation. In the most casual way he makes up
his mind, using for the purpose a few superficial facts, a number of
prejudices, and a bit of experience. He has little idea of where we are
in the course of social development, of the forces which have brought
us here, or of where we ought to be going. Since the opinions of groups
and of the nation are aggregates of individual opinion, the ideas of
those who have an intellectual right to speak are not a large part of
the compound.
Third, despite its crudeness and variety, it possesses elements of
real value. Its very volume creates at least a statistical probability
that some of it is of high quality. The waste of much of it gives the
rest a real chance of expression in social policy. The common features
of industrialism are giving to men something of a common experience
out of which there will come a more or less common-sense appreciation
of problems and of ideals. This will dictate the larger features of a
future social policy. The particularized opinion which finds expression
in the detailed formulation of programmes must be left to the experts.
The great masses of men must learn that these problems are technical
and must trust the judgment of those who know. Despite the record
of halting development and of confused statement, the pages above
indicate that the economic opinion in America is coming slowly to an
appreciation of the factors upon which “the good life for all” really
rests.
But enough. Opinion by being economic does not cease to be opinion, and
an essay about it is only more opinion.
WALTON H. HAMILTON
RADICALISM
The first obstacle to an assessment of radicalism in America is the
difficulty of discovering precisely what American radicalism is.
According to his enemies, a radical is a person whose opinions need
not be considered and whose rights need not be respected. As a people
we do not wish to understand him, or to deal with what he represents,
but only to get him out of sight. We deport him and imprison him. If
he writes a book, we keep it out of the schools and libraries. If he
publishes a paper, we debar it from the mails. If he makes a speech,
we drive him out of the hall and shoo him away from the street-corner.
If by hook or crook he multiplies himself to considerable numbers,
we expel his representatives from legislative chambers, break up his
parades, and disperse his strikes with well-armed soldiery.
These being the associations which cluster about the word, it has
naturally become less a definition than a weapon. Statisticians in
the Federal Trade Commission publish certain figures dealing with the
business of the packing-houses--a Senator loudly calls these devoted
civil servants “radicals,” and they are allowed to resign. A labour
leader, following the precedent of federal law established for over a
half a century, espouses the eight-hour day, but because he has the
bad taste to do so in connection with the steel industry, he becomes a
“radical,” and is soundly berated in the press. If one were to ask the
typical American Legion member how he would describe a radical--aside
from the fact that a radical is a person to be suppressed--he would
probably answer that a radical is (a) a pro-German, (b) a Russian or
other foreigner, (c) a person who sends bombs through the mail, (d) a
believer in free love, (e) a writer of free verse, (f) a painter of
cubist pictures, (g) a member of the I.W.W., (h) a Socialist, (i) a
Bolshevist, (j) a believer in labour unions and an opponent of the open
shop, and (k) any one who would be looked upon with disapproval by a
committee consisting of Judge Gary, Archibald Stevenson, and Brander
Matthews.
There is scarcely more light to be had from the radicals themselves.
Any one who feels a natural distaste for the censorious crowd of
suppressors is likely to class himself with the free spirits whom
they oppose. To call oneself a radical is in such circumstances a
necessary accompaniment of self-respect. The content of the radicalism
is of minor importance. There is an adventurous tendency to espouse
anything that is forbidden, and so to include among one’s affirmations
the most contradictory systems--such as Nietzscheanism and Communism,
Christianity of the mystical sort and rebellion. And when these rebels
really begin to think, the confusion is increased. Each pours his whole
ardour into some exclusive creed, which makes him scorn other earnest
souls who happen to disagree about abstruse technical points. Among
economic radicals, terms like “counter-revolutionary” and “bourgeois”
are bandied about in a most unpleasant fashion. If, for instance, you
happen to believe that Socialism may be brought about through the
ballot rather than through the general strike, numbers of radicals will
believe you more dangerous than the Czar himself; it is certain that
when the time comes you will be found fighting on the wrong side of
the barricade. Creeds have innumerable subdivisions, and on the exact
acceptance of the creed depends your eternal salvation. Calvinists,
Wesleyans, Lutherans, and the rest in their most exigent days could not
rival the logical hair-splitting which has lately taken place among
the sectarian economic dissenters, nor has any religious quarrel ever
surpassed in bitterness the dogmatic dissidence with which the numerous
schools of authoritarian rebellion rebel against authority.
There is a brilliant magazine published in New York which takes pride
in edging a little to the left of the leftmost radical, wherever for
the moment that may be. Its editor is a poet, and he writes eloquently
of the proletariat and the worker. Not long ago I was speaking of this
editor to an actual leader of labour--a man who is a radical, and who
also takes a daily part in the workers’ struggles. “Yes,” he said, “he
certainly can write. He is one of the best writers living.” And he
went on wistfully, “If the labour movement only had a writer like that!”
There is another brilliant magazine published in New York which takes
exquisite pains to inform the reader that it is radical. In precise
columns of elegant type, Puritan in its scorn of passion or sensation,
it weekly derides the sentimental liberal for ignorance of “fundamental
economics.” Not long ago it made the startling discovery that
Socialists favour taking natural resources out of private ownership.
And its “fundamental economics,” whenever they appear in language
simple enough for the common reader to understand, turn out to be
nothing more dangerous than that respectable and ancient heresy, the
single tax.
Another method of definition is now in common use--a method which
seems easy because of its mechanical simplicity. People are arranged
in a row from left to right, according to their attitude toward the
existing order. At the extreme right are the reactionaries, who want
to restore the discarded. Next to them are the conservatives, who wish
to keep most of what exists. At their elbow are the liberals, who are
ready to examine new ideas, but who are not eager or dogmatic about
change. And at the extreme left are the radicals, who want to change
nearly everything for something totally new. Such an arrangement is a
confusing misuse of words based on a misconception of social forces.
Society is not a car on a track, along which it may move in either
direction, or on which it may stand still. Society is a complex, with
many of the characteristics of an organism. Its change is continuous,
although by no means constant. It passes through long periods of
quiescence, and comparatively brief periods of rapid mutation. It
may collect itself into a close order, or again become dispersed
into a nebula. There is much in its development that is cyclical; it
has yet undiscovered rhythms, and many vagaries. The radical and the
reactionary may be agreed on essentials; they may both wish sudden
change and closer organization. The conservative may be liberal because
he wishes to preserve an order in which liberal virtues may exist. Or a
liberal may be so cribbed and confined by an unpleasant constriction
of social tissue that he becomes radical in his struggle for immediate
release. The terms are not of the same class and should not be arranged
in parallel columns.
The dictionary definition is enlightening. “Radical--Going to the root
or origin; touching or acting upon what is essential or fundamental;
thorough.... _Radical reform_, a thorough reform.... Hence Radical
Reformer equals Radical” (New English Dictionary). In this sense
radicalism is an historic American tradition. The revolt of the
Colonies against England and the formation of the Republic were,
indeed, far from the complete break with the past which the schoolboy
assumes them to have been, but what lives in the minds of the American
people is, nevertheless, not the series of counterchecks which men
like Hamilton and Madison wrote into the Constitution, but rather the
daring affirmations of Jefferson which have a real kinship with the
radical spirit of the French Revolution. Talk of “inalienable rights”
such as life, liberty, and the pursuit of happiness was genuine radical
talk; it searched out the bases of human relationship, proclaimed them
against authority, and sought to found on them a system of government.