Capitalism, like every other social system, implies a class that rules
and a class that is controlled. The ruling class--_pace_ those
political theorists who refuse to know that a ruling class exists--is
composed of the capitalist employers. And how do the capitalist
employers differ from any others of the masters that the world has
known? Not merely in that they possess accumulations and pay wages in
money. These are incidental facts. What is essential is that the
capitalist employers, in so far as they are truly such, are controlled
in all their active dealings by the principle of commercialization.
And commercialization is a psychical phenomenon. It is the
substitution, in economic conduct, of a process of calculation for a
process of feeling and will. The antithesis between the two processes
has long been recognized by practical men, under the form of the
contrast between "business" and "sentiment." That much maligned
abstraction of the economists, "the economic man," is nothing but the
capitalistic entrepreneur, reacting as he must to a competitive
situation. What the orthodox economists failed to observe is that
so-called "economic conduct" is class conduct. It is confined to the
merchants and manufacturers of a competitive régime, whose daily life
consists in the manipulation of exchange values. Employers who enjoy a
monopoly, independent laborers, and even the typical wage earners of
capitalism, may--indeed, must--permit their actions to be governed by
other motives, as well as by that of profit. But the capitalist
employer in a competitive trade is quickly taught by bitter experience
that it is not his function to judge and choose. His business is to
calculate; and the less non-economic principles of action interfere
with his decisions, the more certain he is of success. All elements
essential to his business present themselves in the guise of exchange
values. All magnitudes, thus, are commensurate: you compare one with
the other and choose the greater. Intelligence is required for the
ascertaining of relative magnitudes. But the calculation once made,
action is determined. Whether you are a man of strong will or weak
will, of active feelings or passive, you do not hesitate when, in
effect, a dollar is offered you in exchange for fifty cents.
It is cool intelligence, not dominant personality, that, under a
purely capitalistic system, determines the distribution of the seats
of power. The capitalist employers are our ruling class, but of all
classes that have ever held power, they least resemble personal
rulers. They calculate, but conditions beyond their control determine.
And, to be most successful, they must divest their calculations of all
elements that are irrelevant to profit making. If I am a capitalist
employer, operating under conditions of keen competition, I buy no
more readily from an honest man than from a rogue, provided the rogue
can give good title to the things he sells. I hire men, Teutons or
Slavs or Latins, white, black or yellow, with a sole view to their
effectiveness for purposes of profit. I may have private opinions on
religion or politics or morals; on the use of alcohol or opium or
tobacco. But unless I can relate such manifestations of virtues or
vices to the point of profit, I must suppress these opinions, in my
active dealings with men. It follows, then, that in all that concerns
the capitalist employer, in all that concerns his essential rulership,
he is a respecter of the liberties of men.
No one, it is true, is a capitalist employer, pure and simple. In his
social life, every one is likely to retain some of his age-old
prejudices, and to seek to enforce age-old oppressions. As a business
man, no one would be so foolish as to refuse to sit in the same board
of directors with any other capable business man, Hellene or [Greek:
barbaros]. In his club life, on the other hand, many a business man
affects a patrician exclusiveness. The most Christian business man
does not refuse to deal freely with atheists, but very likely he
refuses to admit them to his house. As a mine operator I should employ
negroes as skilled or unskilled laborers, as foremen or bosses, if
such employment were favorable to financial results. I might none the
less, as a citizen, attempt to exclude them from public office. In
business hours, the exercise of personal, political or religious
oppression is penalized by technical inefficiency and pecuniary loss.
Out of business hours, however, every man tends still to revert to the
aboriginal state of manhood, narrow, illiberal, obstinate, oppressive.
Capitalism, furthermore, is far from having attained complete
dominance, even in business affairs. Personal whim, as a
co-determinant of action, is not obsolete, but merely obsolescent. The
president of a great manufacturing corporation of the Middle West
detests cigarettes, and has promulgated the rule that no men whose
fingers are cigarette stained shall be added to his staff. Mr. Henry
Ford intends to confine the benefits of employment in his mills to men
who are "worthy," that is, to men who conform to certain standards of
conduct that are good in their employer's eyes. There are employers
who will not tolerate in their shops the presence of Socialists;
others who have engaged in a crusade to exterminate "knockers." In all
such cases of essentially personal discrimination an attempt is made,
however, to justify it on abstract grounds of efficiency. Cigarette
smokers, loose livers, Socialists and "knockers" are poor workmen,
assert these employers. The assertion, we all know, is far from being
universally true. In so far as it is false, however, it is a gracious
falsehood in the light of the spirit of capitalism. It is a concession
to the principle that pecuniary considerations alone justify an
invasion of personal liberty.
Discrimination on personal grounds is, moreover, so exceptional as to
count as amiable eccentricity. It is recognized as a handicap, which
can be overcome only by striking superiority in other directions. Mr.
Ford may watch over the private conduct of his employees, because he
is able to pay much higher wages than anyone else. The manufacturing
concern to which reference has been made may discriminate against able
workmen with cigarette stained fingers, because it is efficiently
organized, and enjoys a monopoly position. Such instances are
necessarily rare, and are interesting only as a contrast to the
businesses controlled strictly by the spirit of capitalism.
Personal oppression may still be exercised within business hours: but
it represents an added cost, readily determined by scientific
management. The machinery for its suppression is in motion; it cannot
forever survive. There is no equally effective machinery for the
elimination of the personal oppression that emerges out of business
hours. In one's business calculations, one regards a social prejudice,
even if it is directed against oneself, as irrelevant to practical
action, so long as it finds expression only beyond the realm of
business. A persistent slanderer of alien races finds no difficulty in
raising a loan from a foreign banker, provided that the security he
offers is good. No element of revenge in the relations between
Parisian banks and German customers has appeared since the Zabern
incident. Indirectly, however, the social influence of capitalistic
toleration is very considerable. One who has an alien partner may
continue to cherish the heroic myth of Anglo-Saxon superiority, but it
will be through desire for consistency, not out of conviction.
International financial forays upon weak nations, like the late Six
Power loan, have the effect of weakening many a national prejudice.
National, racial and religious prejudices retain their pristine
vitality only where capitalism has not yet reached a high state of
development. It is in Russia and Rumania, economically backward
states, not in England and America, the most capitalistic of all, that
the policy of expelling heterogeneous elements flourishes. It is in
the Old South, still in a precapitalistic stage, that the social gulf
between the races is widest. It is on the Pacific Coast, whose whole
volume of capitalistic industry could be overmatched by that of a city
like Newark, that detestation of an alien race rises to the rank of a
political issue.