IV

If trade and industry, however, embody so fully the principle of

coöperation, how does it come about that they have on the whole had a

rather low reputation, not only among the class groups founded on

militarism, but among philosophers and moralists? Why do we find the

present calamities of war charged to economic causes? Perhaps the

answer to these questions will point the path along which better

coöperation may be expected.

There is, from the outset, one defect in the coöperation between buyer

and seller, employer and laborer. The coöperation is largely

unintended. Each is primarily thinking of his own advantage, rather

than that of the other, or of the social whole; he is seeking it in

terms of money, which as a material object must be in the pocket of one

party or of the other, and is not, like friendship or beauty, sharable.

Mutual benefit is the result of exchange--it need not be the motive.

This benefit comes about as if it were arranged by an invisible hand,

said Adam Smith. Indeed, it was long held that if one of the bargainers

gained, the other must lose. And when under modern conditions labor is

considered as a commodity to be bought and sold in the cheapest market

by an impersonal corporate employer, there is a strong presumption

against the coöperative attitude on either side.

The great problem here is, therefore: How can men be brought to seek

consciously what now they unintentionally produce? How can the man

whose ends are both self-centered and ignoble be changed into the man

whose ends are wide and high? Something may doubtless be done by

showing that a narrow selfishness is stupid. If we rule out monopoly

the best way to gain great success is likely to lie through meeting

needs of a great multitude; and to meet these effectively implies

entering by imagination and sympathy into their situation. The business

maxim of "service," the practices of refunding money if goods are

unsatisfactory, of one price to all, of providing sanitary and even

attractive factories and homes, and of paying a minimum wage far in

excess of the market price, have often proved highly remunerative. Yet,

I should not place exclusive, and perhaps not chief, reliance on these

methods of appeal. They are analogous to the old maxim, honesty is the

best policy; and we know too well that while this holds under certain

conditions,--that is, among intelligent people, or in the long run,--it

is often possible to acquire great gains by exploiting the weak,

deceiving the ignorant, or perpetrating a fraud of such proportions

that men forget its dishonesty in admiration at its audacity. In the

end it is likely to prove that the level of economic life is to be

raised not by proving that coöperation will better satisfy selfish and

ignoble interests, but rather by creating new standards for measuring

success, new interests in social and worthy ends, and by strengthening

the appeal of duty where this conflicts with present interests. The one

method stakes all on human nature as it is; the other challenges man's

capacity to listen to new appeals and respond to better motives. It is,

if you please, idealism; but before it is dismissed as worthless,

consider what has been achieved in substituting social motives in the

field of political action. There was a time when the aim in political

life was undisguisedly selfish. The state, in distinction from the

kinship group or the village community, was organized for power and

profit. It was nearly a gigantic piratical enterprise, highly

profitable to its managers. The shepherd, says Thrasymachus in Plato's

dialogue, does not feed his sheep for their benefit, but for his own.

Yet now, what president or minister, legislator or judge, would

announce as his aim to acquire the greatest financial profit from his

position? Even in autocratically governed countries, it is at least the

assumption that the good of the state does not mean solely the prestige

and wealth of the ruler.

A great social and political order has been built up, and we all hold

that it must not be exploited for private gain. It has not been created

or maintained by chance. Nor could it survive if every man sought

primarily his own advantage and left the commonwealth to care for

itself. Nor in a democracy would it be maintained, provided the

governing class alone were disinterested, deprived of private property,

and given education, as Plato suggested. The only safety is in the

general and intelligent desire for the public interest and common

welfare. At this moment almost unanimous acceptance of responsibility

for what we believe to be the public good and the maintenance of

American ideals--though it brings to each of us sacrifice and to many

the full measure of devotion--bears witness to the ability of human

nature to adopt as its compelling motives a high end which opposes

private advantage.

Is the economic process too desperate a field for larger motives? To me

it seems less desperate than the field of government in the days of

autocratic kings. One great need is to substitute a different standard

of success for the financial gains which have seemed the only test. Our

schools of commerce are aiming to perform this service, by introducing

professional standards. A physician is measured by his ability to cure

the sick, an engineer by the soundness of his bridge and ship; why not

measure a railroad president by his ability to supply coal in winter,

to run trains on time, and decrease the cost of freight, rather than by

his private accumulations? Why not measure a merchant or banker by

similar tests?

Mankind has built up a great economic system. Pioneer, adventurer,

inventor, scientist, laborer, organizer, all have contributed. It is as

essential to human welfare as the political system, and like that

system it comes to us as an inheritance. I can see no reason why it

should be thought unworthy of a statesman or a judge to use the

political structure for his own profit, but perfectly justifiable for a

man to exploit the economic structure for private gain. This does not

necessarily exclude profit as a method of paying for services, and of

increasing capital needed for development, but it would seek to adjust

profits to services, and treat capital, just as it regards political

power, as a public trust in need of coöperative regulation and to be

used for the general welfare.

But the war is teaching with dramatic swiftness what it might have

needed decades of peace to bring home to us. We _are_ thinking of the

common welfare. High prices may still be a rough guide to show men's

needs, but we are learning to raise wheat because others need it--not

merely because the price is high. Prices may also be a rough guide to

consumption, but we are learning that eating wheat or sugar is not

merely a matter of what I can afford. It is a question of whether I

take wheat or sugar away from some one else who needs it--the soldier

in France, the child in Belgium, the family of my less fortunate

neighbor. The great argument for not interfering with private exchange

in all such matters has been that if prices should by some authority be

kept low in time of scarcity, men would consume the supply too rapidly;

whereas if prices rise in response to scarcity, men at once begin to

economize and so prevent the total exhaustion of the supply. We now

reflect that if prices of milk rise it does not mean uniform

economy--it means cutting off to a large degree the children of the

poor and leaving relatively untouched the consumption of the

well-to-do. Merely raising the _price_ of meat or wheat means taking

these articles from the table of one class to leave them upon the table

of another. War, requiring, as it does, the united strength and purpose

of the whole people, has found this method antiquated. In Europe

governments have said to their peoples: we _must_ all think of the

common weal; we _must_ all share alike. In this country, the appeal of

the food administrator, though largely without force of law, has been

loyally answered by the great majority. It is doubtless rash to predict

how much peace will retain of what war has taught, but who of us will

again say so easily, "My work or leisure, my economy or my luxury, is

my own affair, if I can afford it?" Who can fail to see that common

welfare comes not without common intention?

The second great defect in our economic order, from the point of view

of coöperation, has been the inequality of its distribution. This has

been due largely to competition when parties were unequal, not merely

in their ability, but in their opportunity. And the most serious,

though not the most apparent, aspect of this inequality, has not been

that some have more comfort or luxuries to enjoy; it is the fact that

wealth means power. In so far as it can set prices on all that we eat,

wear, and enjoy, it is controlling the intimate affairs of life more

thoroughly than any government ever attempted. In so far as it controls

natural resources, means of transportation, organization of credit, and

the capital necessary for large-scale manufacturing and marketing, it

can set prices. The great questions then are, as with political power:

How can this great power be coöperatively used? Is it serving all or a

few?

Two notable doctrines of the courts point ways for ethics. The first is

that of property affected with public interest. Applied thus far by the

courts to warehouses, transportation, and similar public services, what

limits can we set ethically to the doctrine that power of one man over

his fellows, whether through his office, or through his property, is

affected with public interest?

The police power, which sets the welfare of all above private property

when these conflict, is a second doctrine whose ethical import far

outruns its legal applications.

Yet it is by neither of these that the most significant progress has

been made toward removing that handicap of inequality which is the

chief injustice of our economic system. It is by our great educational

system, liberal in its provisions, generously supported by all classes,

unselfishly served, opening to all doors of opportunity which once were

closed to the many, the most successful department of our democratic

institutions in helping and gaining confidence of all--a system of

which this University of California is one of the most notable leaders

and the most useful members--that fair conditions for competition and

intelligent coöperation in the economic world are increasingly

possible.

V

What bearing has this sketch of the significance and progress of

coöperation upon the international questions which now overshadow all

else? Certainly the world cannot remain as before: great powers

struggling for empire; lesser powers struggling for their separate

existence; great areas of backward peoples viewed as subjects for

exploitation; we ourselves aloof. It must then choose between a future

world order based on dominance, which means world empire; a world order

based on nationalism joined with the non-social type of competition,

which means, every nation the judge of its own interests, continuance

of jealousies and from time to time the recurrence of war; and a world

order based on nationalism plus international coöperation, "to

establish justice, to provide for common defense, to promote the

general welfare, and to secure the blessings of liberty to ourselves

and our posterity."

It is not necessary to discuss in this country the principle of

dominance and world empire. It contradicts our whole philosophy. Safety

for dominance lies only in a civilization of discipline from above

down, in ruthless repression of all thinking on the part of the subject

class or race.

Nor can I see any genuine alternative in what some advocate--reliance

by each nation on its own military strength as the sole effective

guarantee for its interests. After the military lessons of this war,

the concentration of scientific, economic, and even educational

attention upon military purposes would almost inevitably be vastly in

excess of anything previously conceived. What limits can be set to the

armies of France and Great Britain if these are to protect those

countries from a German empire already double its previous extent, and

taking steps to control the resources of eastern Europe and the near

East? What navy could guarantee German commerce against the combined

forces of Great Britain and the United States? What limits to the

frightfulness yet to be discovered by chemist and bacteriologist? What

guarantee against the insidious growth of a militarist attitude even in

democratically minded peoples if the constant terror of war exalts

military preparations to the supreme place? Something has changed the

Germany of other days which many of us loved even while we shrank from

its militarist masters. Is it absolutely certain that nothing can

change the spirit of democratic peoples? At any rate, America, which

has experimented on a larger scale with coöperation--political,

economic, and religious--than any other continent, may well assert

steadily and insistently that this is the more hopeful path. It may

urge this upon distrustful Europe.

The obstacles to coöperation are:

1. The survival of the principle of dominance, showing itself in desire

for political power and prestige, and in certain conceptions of

national honor.

2. The principle of non-social competition, exhibited in part in the

political policy of eliminating weaker peoples, and conspicuously in

foreign trade when the use of unfair methods relies upon national power

to back up its exploitation or monopoly.

3. The principle of nationalistic sentiment, itself based on

coöperation, on social tradition and common ideals, but bound up so

closely with political sovereignty and antagonisms as to become

exclusive instead of coöperative in its attitude toward other cultures.

The principle of dominance deters from coöperation, not only the people

that seeks to dominate, but peoples that fear to be dominated or to

become involved in entangling alliances. Doubtless a policy of

aloofness was long the safe policy for us. We could not trust political

liberty to an alliance with monarchies, even as with equal right some

European peoples might distrust the policies of a republic seemingly

controlled by the slavery interest. At the present time one great power

professes itself incredulous of the fairness of any world tribunal;

smaller powers fear the commanding influence of the great; new national

groups just struggling to expression fear that a league of nations

would be based on present status and therefore give them no

recognition, or else a measure of recognition conditioned by past

injustices rather than by future aspirations and real desert. All these

fears are justified in so far as the principle of dominance is still

potent. The only league that can be trusted by peoples willing to live

and let live, is one that is controlled by a coöperative spirit. And

yet who can doubt that this spirit is spreading? Few governments are

now organized on the avowed basis that military power, which embodies

the spirit of dominance, should be superior to civil control, and even

with them the principle of irresponsible rule, despite its

reinforcement by military success, is likely to yield to the spirit of

the age when once the pressure of war is removed which now holds former

protesters against militarism solid in its support. For all powers that

are genuine in their desire for coöperation there is overwhelming

reason to try it; for only by the combined strength of those who accept

this principle can liberty and justice be maintained against the

aggression of powers capable of concentrating all their resources with

a suddenness and ruthlessness in which dominance is probably superior.

Yet coöperation for protection of liberty and justice is liable to fall

short of humanity's hopes unless liberty and justice be themselves

defined in a coöperative sense. The great liberties which man has

gained, as step by step he has risen from savagery, have not been

chiefly the assertion of already existing powers or the striking-off of

fetters forged by his fellows. They have been _additions_ to previous

powers. Science, art, invention, associated life in all its forms, have

opened the windows of his dwelling, have given possibilities to his

choice, have given the dream and the interpretation which have set him

free from his prison. The liberty to which international coöperation

points is not merely self-direction or self-determination, but a larger

freedom from fear, a larger freedom from suspicion, a fuller control

over nature and society, a new set of ideas, which will make men free

in a far larger degree than ever before.

Similarly justice needs to be coöperatively defined. A justice that

looks merely to existing status will not give lasting peace. Peoples

change in needs as truly as they differ in needs. But no people can be

trusted to judge its own needs any more than to judge its own right. A

justice which adheres rigidly to vested interests, and a justice which

is based on expanding interests, are likely to be deadlocked unless a

constructive spirit is brought to bear. Abstract rights to the soil, to

trade, to expansion, must be subordinate to the supreme question: How

can peoples live together and help instead of destroy? This can be

approached only from an international point of view.

The second obstacle, unsocial competition, is for trade what dominance

is in politics. It prevents that solution for many of the delicate

problems of international life which coöperation through trade might

otherwise afford. Exchange of goods and services by voluntary trade

accomplishes what once seemed attainable only by conquest or slavery.

If Germany or Japan or Italy needs iron or coal; if England needs

wheat, or if the United States sugar, it is possible, or should be

possible, to obtain these without owning the country in which are the

mines, grain, and sugar cane. The United States needs Canada's

products; it has no desire to own Canada. But in recent years the

exchange of products has been subjected to a new influence. National

self-interest has been added to private self-interest. This has

intensified and called out many of the worst features of antagonism and

inequality.

Few in this country have realized the extent to which other countries

have organized their foreign commerce on national lines. We are now

becoming informed as to the carefully worked-out programmes of

commercial education, merchant marines, trade agreements, consular

service, financial and moral support from the home government, and

mutual aid among various salesmen of the same nationality living in a

foreign country. We are preparing to undertake similar enterprises. We

are reminded that "eighty per cent of the world's people live in the

countries bordering on the Pacific Ocean, and that as a result of the

rearrangement of trade routes, San Francisco's chance of becoming the

greatest distributing port of the Pacific for goods _en route_ to the

markets of the Orient, are now more promising than ever before." Can

the United States take part in this commerce in such a way as to help,

not hinder, international progress in harmony? Not unless we remember

that commerce may be as predatory as armies, and that we must provide

international guarantees against the exclusive types of competition

which we have had to control by law in our own domestic affairs. An

Indian or an African may be deprived of his possessions quite as

effectively by trade as by violence. We need at least as high standards

of social welfare as in domestic commerce. I cannot better present the

situation than by quoting from a recent article by Mr. William Notz in

the "Journal of Political Economy" (Feb. 1918):

During the past twenty-five years competition in the world markets

became enormously keen. In the wild scramble for trade the

standards of honest business were disregarded more and more by all

the various rival nations. In the absence of any special regulation

or legislation, it appeared as though a silent understanding

prevailed in wide circles that foreign trade was subject to a code

of business ethics widely at variance with the rules observed in

domestic trade. What was frowned upon as unethical and poor

business policy, if not illegal at home, was condoned and winked at

or openly espoused when foreign markets formed the basis of

operations and foreigners were the competitors. High-minded men of

all nations have long observed with concern the growing tendency of

modern international trade toward selfish exploitation,

concession-hunting, cut-throat competition, and commercialistic

practices of the most sordid type. Time and again complaints have

been voiced, retaliatory measures threatened, and more than once

serious friction has ensued.

Mr. Notz brings to our attention various efforts by official and

commercial bodies looking toward remedies for such conditions and

toward official recognition by all countries of unfair competition as a

penal offense.

What more do we need than fair competition to constitute the

coöperative international life which we dreamed yesterday and now must

consider, not merely as a dream, but as the only alternative to a

future of horror?

Free trade has been not unnaturally urged as at least one condition.

Tariffs certainly isolate. To say to a country: "You shall manufacture

nothing unless you own the raw material; you shall sell nothing unless

at prices which I fix," is likely to provoke the reply: "Then I must

acquire lands in which raw materials are found; I must acquire colonies

which will buy my products." Trade agreements mean coöperation for

those within, unless they are one-sided and made under duress; in any

case they are exclusive of those without. Free trade, the open door,

seems to offer a better way. But free trade in name is not free trade

unless the parties are really free--free from ignorance, from pressure

of want. If one party is weak and the other unscrupulous; if one

competitor has a lower standard of living than the other, freedom of

trade will not mean genuine coöperation. Such coöperation as means good

for all requires either an equality of conditions between traders and

laborers of competing nations and of nations which exchange goods, or

else an international control to prevent unfair competition,

exploitation of weaker peoples, and lowering of standards of living.

Medical science is giving an object lesson which may well have a wide

application. It is seeking to combat disease in its centers of

diffusion. Instead of attempting to quarantine against the Orient, it

is aiding the Orient to overcome those conditions which do harm alike

to Orient and Occident. Plague, anthrax, yellow fever, cannot exist in

one country without harm to all. Nor in the long run can men reach true

coöperation so long as China and Africa are a prize for the exploiter

rather than equals in the market. Not merely in the political sense,

but in its larger meanings democracy here is not safe without democracy

there. Education, and the lifting of all to a higher level, is the

ultimate goal. And until education, invention, and intercommunication

have done their work of elevation, international control must protect

and regulate.

In many respects the obstacle to international coöperation which is

most difficult to remove is the strong and still growing sentiment of

nationality. This is not, like dominance, a waning survival of a cruder

method of social order; it is a genuine type of coöperation. Rooted as

it is in a historic past, in community of ideals and traditions, and

usually of language and art, it wakens the emotional response to a

degree once true only of religion. Born of such a social tradition, the

modern may be said in truth mentally and spiritually, as well as

physically, to be born a Frenchman or a German, a Scotchman or Irishman

or Englishman. He may be content to merge this inheritance in an empire

if he can be senior partner, but the struggles of Irish, Poles, Czechs,

and South Slavs, the Zionist movement, the nationalistic stirrings in

India, with their literary revivals, their fierce self-assertions, seem

to point away from internationalism rather than toward it. The Balkans,

in which Serb, Bulgar, Roumanian, and Greek have been developing this

national consciousness, have been the despair of peacemakers.

The strongest point in the nationalist programme is, however, not in

any wise opposed to coöperation, but rather to dominance or non-social

competition. The strongest point is the importance of diversity

combined with group unity for the fullest enrichment of life and the

widest development of human capacity. A world all of one sort would not

only be less interesting, but less progressive. We are stimulated by

different customs, temperaments, arts, and ideals. But all this is the

strongest argument for genuine coöperation, since by this only can

diversity be helpful, even as it is only through diversity in its

members that a community can develop fullest life. A world organization

based on the principle that any single group is best and therefore

ought to rule, or to displace all others, would be a calamity. A world

organization which encourages every member to be itself would be a

blessing.

Why do nationalism and internationalism clash? Because this national

spirit has rightly or wrongly been bound up so intimately with

political independence. Tara's harp long hangs mute when Erin is

conquered. Poland's children must not use a language in which they

might learn to plot against their masters. A French-speaking Alsatian

is suspected of disloyalty. Professor Dewey has recently pointed out

that in the United States we have gone far toward separating culture

from the state, and suggests that this may be the path of peace for

Europe. We allow groups to keep their religion, their language, their

song festivals. It may perhaps be claimed that this maintenance of

distinct languages and separate cultures is a source of weakness in

such a crisis as we now face. Yet it may well be urged, on the other

hand, that a policy less liberal would have increased rather than

diminished disunion and disloyalty.