SOME MECHANICAL ANALOGIES
It may help the exposition if we throw the argument, briefly, into terms of
the more familiar mechanical analogies, and speak of the equilibria and
transformations of social forces. Of course, mechanical analogies have been
used from time to time already in our discussion--psychologists themselves
often find it useful to conceive of their phenomena in mechanical terms.
And while, in the exposition, we shall find frequent reason to prefer our
plan of conceiving society as a psychical organism, and the social forces
as phases in an organic process, still certain relations may be clearer for
being put into the other form.
Social values may be transformed into other forms of social value--as heat
may be transformed into electricity, or into motion, or motion into heat,
etc. Professor Clark, with his distinction between "capital" and "capital
goods," has shown how economic value may undergo constant transformation,
as to its physical embodiment, and yet remain generically the same. But the
possibilities of transformation are not confined to the economic sphere. We
may generalize the notion. A man may use economic value to attain political
power; having the political power, he may use it to get economic value
back again, by direct barter and sale, if he wishes to take bribes, or by
subtler, but still all too familiar means. Or, the political power may be
transformed into personal prestige, if used in ways that please those whose
good will means prestige. And personal influence--"live human power" (in
Professor Cooley's phrase),[179] may be transformed into values of numerous
sorts, into political power, into moral values--if he who has it wishes to
make a propaganda--into prestige for other men, into economic value--for
cannot an inspiring man command the purses of others in behalf of his plans
and purposes? And may not popular confidence in a great statesman or
financier in times of panic cause fears to be allayed, and values to return
to goods that had lost their value? A man who has goods for which no demand
exists, and which have, hence, little value, may, employing those who
possess the art of creating demand to make public opinion for him by
advertising, find his investment, transformed into public belief and
interest, return to him a golden harvest. A religious value may flow into
the economic value of religious books. A moral or religious value may be
transformed into a law. A legal value--as a franchise right[180]--has often
a definitely recognized economic value as well. Economic value, spent in an
educational campaign, may result in the establishment of a new moral or
legal value. And so on indefinitely. Enough has been said to show that
there is some sort of analogy between social and physical forces, in that
both can be transformed into other forms of force. The analogy might be
pushed further. It is often difficult to make the transformation in both
cases--there's lots of "friction" if a man starts out publicly and brazenly
to buy a political office, and a great deal of waste in the process. But
enough has also been said to show the weakness of such an analogy: in
creating personal prestige through the wise use of his political power, an
officer may actually increase, instead of exhausting, his political power.
Or, in the moment of attempting certain transformations, the original power
may be suddenly wiped out--as if a great political leader should undertake
to popularize some form of immorality. There is no law of equivalence, of
conservation of energy, in social forces. Their nature and their relations
are organic, and not mechanical.
Or, we may speak of equilibria among social forces. Economists have for a
long time been used to this, speaking of equilibria between supply and
demand, between labor and capital, between enterprise and the other factors
of production, between intensive and extensive margins, etc. But we may
also have equilibria between, say, demand and moral values, as when moral
forces oppose the consumption of liquor, or between supply and law, as in
the case where regulation, rather than total suppression, of certain
vicious businesses is the practice, or where the effort at total
suppression falls short. And equilibria between enterprise and law and
morals are being constantly worked out--entrepreneurs seeking to produce at
the minimum expense, even at the cost of the lives and health of their
employees, and law and morals[181] drawing limits beyond which they must
not go, with a struggle between them at the margin--and the money prices of
the products reflect the marginal equilibrium attained. Supply may be in
equilibrium with a protective tariff, or an internal revenue excise--legal
values which the economists have long been accustomed to treat
quantitatively by the laws of incidence, and whose strength they measure in
terms of money prices.[182] Not "utility and cost," but an infinite complex
of social forces are in equilibrium in the economic situation.
And the social forces in equilibrium at focal points are themselves
composites of many forces, cooperating and reinforcing each other, each of
these forces having its own equilibria with other minor forces--a net
resultant sending the unneutralized energy of both in a common direction,
to form part of a bigger stream of energy. "Demand" is a stream of energy
fed by many springs, among which, no doubt, individual wants for the good
in question are to be found, but which include the legal and moral values
of _men_, also, and an infinite host of other forces.
And, just as one form of physical energy may be substituted for another,
under different systems of technique, electricity taking the place of steam
power, steam doing the work formerly done by horse or human power, so, in
particular forms of social organization, one form of social force may do
the work that is better done by some other form of social force under a
different form of social organization. Thus the regulation of the details
of conduct, a matter of iron law (or of custom with the force of law) in
certain stages, we now leave to the control of subtler social forces. At
one stage we depend on religious values, the curse and the benediction of
the church, as a tremendously vital power in social control; now we find
other modes of social energy frequently more efficacious. Now we depend
primarily on economic social values, under a competitive system, to
motivate the economic activities of society, to determine whether this
piece of land shall be planted in wheat, or in some other crop, or
fertilized in this or that manner; in the mediaeval English manor, many
questions like these were settled by vote of the manor court.
But whatever the form in which the social energy of control and motivation
manifests itself, its functional character is the same. It has its origin
in, and receives its vitality from, the social will--or better is a phase
of the social will--as steam power, electric power, and the energy in human
muscles, are species of the same generic force.
The effort has not been made to put the whole of our argument into these
obviously uncongenial terms. The mechanical analogies, often useful for
particular purposes, fail to bring out the rich complexity, the organic
nature, of the social processes, and, by their very simplicity, often lead
to the ignoring of essential factors. For the purposes of the practical
economist, however, concerned with price analysis in a situation which is
so complex that he can give attention to only one set of forces, or
tendencies, at a time, and where quantitative measurement is essential, it
is often highly necessary to abstract from the organic complexity, to
assume that other forces than those he is measuring are constant, and to
put his argument into mechanical terms. My conception involves no radical
revision of economic methodology in this matter. It is primarily concerned
with the interpretation and validation of this methodology. To this topic I
shall return in the chapters on the relation between the theory of value
and the theory of prices.
FOOTNOTES:
[179] _Social Organization_, p. 264.
[180] Professor J. R. Commons has made some interesting comments in a note
("Political Economy and Business Economy," _Quar. Jour. Econ._, Nov.,
1907), as to the extent to which intangible objects have come to have
economic value. The legal and psychical nature of such values is, of
course, very manifest.
[181] Moral values, like economic values, in the sense in which I use the
term here, are actual facts, and not mere ideals. A moral value _is_ a
value, to the extent that it is an effective _power in motivation_, to the
extent that the social will backs it up, and punishes with its disapproval
and with the subtle penalties which social disapproval involves,
infractions of the moral standard in question. I am not here passing
judgment on moral values themselves in the light of any ideal standard, but
simply describing the manner in which moral values function.
[182] Intrinsically, there is no more reason why the economist should
concern himself with measuring quantitatively the effect of tariff laws
than with a similar treatment of other legal values. Tariffs do not affect
industry any more intimately than hosts of other laws. The obvious reason
why the economic laws of taxation have been worked out and the others
ignored, in our economic analyses, is that the tax laws, being themselves
expressed in money terms, are more easily handled by the economist.