The Unreconciled science: The enduring tension between wealth accumulation and social welfare

“ In modern times the conditions which have made economic science possible have also made it necessary. While it is impossible to give a strictly economic interpretation of the earlier history of nations, economic interests so govern the life and determine the policy of modern Necessity of economic science.states that other forces, like those of religion and politics, seem to play only a subsidiary part, modifying here and there the view which is taken of particular questions, but not changing in any important degree the general course of their development. ”

“ Economics is unlike many other sciences in the fact that its claim to recognition must be based upon its practical utility, on its relevance to the actual life of the economic world, on its ability to unravel the social and economic difficulties of each generation, and to contribute to the Some recent developments of economic theory.progress of nations. The very effectiveness of modern criticism and analysis, which has brought great gains in almost all branches of economic theory, has made the science more difficult as a subject of ordinary study. ”

“ Of course, as in the case of other delusions, political economy has a plausible idea at the root of it. "The social affections," says the economist, "are accidental and disturbing elements in human nature; but avarice and the desire for progress are constant elements. Let us eliminate the inconstants, and considering man merely as a money-making machine, examine by what laws of labour, purchase and sale, the greatest amount of wealth can be accumulated. ”

“ The reasoning might be admirable, the conclusions true, and the science deficient only in applicability. Modern political economy stands on a precisely similar basis. It imagines that man has a body but no soul to be taken into account and frames its laws accordingly. How can such laws possibly apply to man in whom the soul is the predominant element? ”

“ Undoubtedly an economic science can be and has been constructed which does ignore morality and, dealing with man not as he really is but stripped of his morality, or as he is termed by some economic writers, "economic man," and still more naïvely by others the "average sensual man," has laid down the laws which for such a man govern the production, distribution, and accumulation of wealth. In the development of this science it has been found necessary to define wealth, and here we come upon the first hard substance against which economists have broken their heads. ”

“ My contention is that much of the present evils which afflict society is due to too great a prevalence of Nature's laws, and to too little practice of the moral law. So long as reformers endeavor to work out their respective systems by an appeal to the so-called science of political economy, and persistently ignore the moral phase of the question, so long must society wait in vain for the realization of its dreams. The final teaching of economics would show that it is far more conducive to national wealth and prosperity to stimulate the production of machinery than of men! ”

“ It no longer confines itself to the question, How is the maximum of wealth to be produced? or, What motives sway men in the pursuit of wealth? It inquires into the general conditions of social well-being; it wants to know how far it may be possible to check that reign of universal cupidity on which the older economists seemed to count as an unalterable attitude of the human mind; and it asks searching questions as to the nature and requirements of justice between man and man. ”

“ ESSAY II. THE VEINS OF WEALTH.
The answer which would be made by any ordinary political economist to the statements contained in the preceding paper, is in few words as follows:—
"It is indeed true that certain advantages of a general nature may be obtained by the development of social affections. But political economists never professed, nor profess, to take advantages of a general nature into consideration. Our science is simply the science of getting rich. So far from being a fallacious or visionary one, it is found by experience to be practically effective. ”

“ In its calculations the science of wealth takes little note of, nay, it often carefully excludes, the potent force of sympathy, and of those passions which lead men to toil, to struggle, even to die for the good of others. And yet it is these higher passions, these nobler impulses, that urge most strenuously to its study. The promise of political economy is not so much what it may do for you, as what it may enable you to do for others. ”

“ Even if we put aside all questions which involve a consideration of the effects of industrial institutions in modifying the habits and character of the classes of the community, ... that enough still remains to constitute a separate science, the mere enumeration of the chief terms of economics—wealth, value, exchange, credit, money, capital, and commodity—will suffice to show. ”

“ Of course if there is a science of wealth, it must give rules for gaining wealth and disposing of wealth, and can do nothing more; it cannot itself declare that it is a subordinate science, that its end is not the ultimate end of all things, and that its conclusions are only hypothetical, depending on its premisses, and liable to be overruled by a higher teaching. I do not then blame the Political Economist for anything which follows from the very idea of his science, from the very moment that it is recognized as a science. ”

“ Economics first studies wealth
Wealth, in the general economic sense, is judged with reference to gratification rather than with reference to abiding welfare. It is the first duty of the economist not to preach what should be, but to understand things as they are. He must, in studying the problem of value, recognize any motive that leads men to attach importance to acts and things. He will therefore take account of abiding welfare and of immediate gratification to exactly the degree that men in general do, and the sad fact is that the present impulse rules a large part of the acts of men. ”

“ But since the principles of human nature that give the outcome in men's economic conduct, so far as it touches the production and distribution of wealth, are but the simple and constant sequence of hedonistic cause and effect, the element of human nature may fairly be eliminated from the problem, with great gain in simplicity and expedition. ”

“ The central point in economic study is the simplest problem of exchange value. The first look at the economic world reveals so many things that have relation to wants, and relations so complex, that the mind is confused. The object of science is to simplify; it seeks unity in the midst of chaos. Relations exist between wants and things that certainly never can gratify them directly. Where is the simplest aspect of the problem to be found? Evidently in the exchange of consumption goods, for these are in closest touch with wants. ”

“ Finally, that apparently most remote of the sciences from the exactness of physical laws, economics, has been brought under the treatment of mathematics, not only by statistical methods like those just described, but by methods of the calculus. The distinguished mathematician and economist Cournot applied to the theory of wealth methods like those used in mechanics to treat of equilibria, so that very complicated economic principles were amenable to treatment by symbols. ”

“ It is only as we approach more modern times that the conditions of economic study are realized and economic science, as we understand it, becomes possible. Those conditions are: (i.) the life of the state or other community or communities we are studying must be so differentiated Conditions of economic science.that we can isolate those functions which are wholly or predominantly economic. The “separation of employments” is not only a condition of economic efficiency; it was necessary before we could have an economic science. ”

“ Definite economic problems can very rarely be dealt with by merely quantitative methods. In the tabulation and interpretation of statistical evidence, as in its collection, it is scarcely possible to overrate the importance of wide knowledge and experience. There is another very important instrument of investigation which can be used in our own time, but cannot be employed in historical research. Historical documents, however detailed, rarely show all the factors we have to deal with or fully explain a given situation. ”

“ But questions of sentiment, shop-feeling and trade customs invariably play an important part. (iii.) Economics can never lead to anything but hypothetical results unless we not only realize that we must “take account of” other than the purely economic factors, but also give due weight and significance to these factors. No explanation of the industrial situation in Germany, for example, would be intelligible or satisfactory even from the economic point of view which ignored the significance of the political conditions which Germans have to deal with. ”

“ The economist must, therefore, not only be prepared to take account of the physical features of the world, the general structure and organization of the industry and commerce of different states, the character of their administration and other important causes of economic change. He must be in touch with the actual life of the community he is studying, and cultivate “that openness and alertness of the mind, that sensitiveness of the judgment, which can rapidly grasp the significance of at first sight unrelated discoveries or events.” ”

“ There is no subject of human study which may not be at some time or other of economic significance, Relations between economics and other sciences.and anything which affects the character, the ideals or the environment of man may make it necessary to modify our assumptions and our reasoning with regard to his conduct in economic affairs. But if the economist, while studying one side of man’s activities, must also cultivate all other branches of human learning, it is obvious that no substantial progress can be made. ”

“ Every volume of records we look through contains a mass of detailed information on the economic life of England in the period we are studying. How much of it is relevant to the subject of inquiry? What is to be the principle of selection? How shall we determine the relative weight and importance of different kinds of relevant evidence? As in modern problems, so in those of past times, a man requires for success qualities quite distinct from those conferred by merely academic training and the use of scientific methods. ”

“ Whatever the cause, the complete restatement of economic theory, which some heroic persons demand, is clearly impossible, except on conditions not likely to be realized in the immediate future. The span of life is limited; the work requires an extensive knowledge of the economic literature of several countries and the general features of all the important departments of modern economic activity. In general theory special studies by other men cannot play the same part as they do in historical and statistical work. ”

“ Here we are ever brought back to the undulating ground of living science, instead of having to follow the rectilineal way traced out by the dead letter. We are always driven back, whatever may be pretended to the contrary, to the realities of which history alone possesses the secret. The idea of wealth cannot absorb everything when there is question of judging and enlightening men. ”

“ But this is a tough old world and politics [Pg 118] is a science too human to be put into books. The economists take no account of "human cussedness" or the instinct to do anything except what the wise of the world say that we should do. No matter how beneficent your theory may be, we will have none of it—and a good thing it is for the world that we will not.
Still, the correspondence-school statesmen and economists are so much a part of the life of to-day, with its agitations and movements and tiresome futilities, that one must give them some attention. ”

“ It is no reproach to economic science to have done so; to have recognized as matters within its proper scope considerations that the older economists, concerning themselves with wealth in its narrow sense, as the summum bonum, and with the desire for its acquisition as the one mainspring of human action, would have regarded as sentimental and philanthropic. ”

“ Such being the everlasting law of human existence, the essential work of the political economist is to determine what are in reality useful or life-giving things, and by what degrees and kinds of labour they are attainable and distributable. This investigation divides itself under three great heads;—the studies, namely, of the phenomena, first, of Wealth; secondly, of Money; and thirdly, of Riches. [Pg 116]
These terms are often used as synonymous, but they signify entirely different things. "Wealth" consists of things in themselves valuable ”

“ The study of Money is a province of commercial science:—it deals with conditions of engagement and exchange.
The study of Riches is a province of moral science:—it deals with the due relations of men to each other in regard of material possessions; and with the just laws of their association for purposes of labour.
I shall in this first chapter shortly sketch out the range of subjects which will come before us as we follow these three branches of inquiry.
12. And first of Wealth, which, it has been said, consists of things essentially valuable. We now, therefore, need a definition of "value." ”

“ Hence, it follows that if a thing is to be useful, it must be not only of an availing nature, but in availing hands. Or, in accurate terms, usefulness is value in the hands of the valiant; so that this science of wealth being, as we have just seen, when regarded as the science of Accumulation, accumulative of capacity as well as of material, -- when regarded as the Science of Distribution, is distribution not absolute, but discriminate; not of every thing to every man, but of the right thing to the right man. A difficult science, dependent on more than arithmetic. ”

“ And in the pages of the most orthodox political economists we observe a kindred tendency. In Mill's "Political Economy" there is no exhaustive examination of the unequal distribution of wealth; but the tone of the whole work is, I think, expressive of regret that inequalities should be so great as they are. While considering inheritance he commends laws enforcing the division of accumulated wealth at death. ”

“ There are so many subjects you can take an interest in if you understand economics, that if you do not, would appeal to you in no way whatever.”
“It helps us to understand some of the most important subjects of the day, and gives us a clearer idea of the difficulties of the poor—and shows us the best way of helping them.”
“The human sympathies cannot fail to be awakened, and narrow-minded and selfish views cannot long be entertained. Economics often shows the best methods in the relief of our less fortunate brothers and sisters.” ”

“ We want to show that the lust of wealth is a poor motive for any man's or woman's chief activity. Bat how is all this to be done? The mere teaching of arithmetic, geography, and grammar will not do it. It can best be done, as it seems to us, by a scientific, that is to say, a rational exposition, on the one hand, of the principles which go to produce the dignity, security, and happiness both of nations and of individuals; and, on the other, of the causes which lead to national decay and individual misery. ”

“ No economist known to me, however strong an upholder of the freedom of individual action and of individual development, has ever forgotten that man is a social animal. Adam Smith wrote The Wealth of Nations, but he also wrote The Moral Sentiments. ”

“ But when they concern human actions they are the result of all the motives which govern those actions; in other words, they are the result not merely of selfishness, but also of sympathy. And as Adam Smith, in the Wealth of Nations, dealt with only one of those passions viz., selfishness he would have found it impossible to conduct his generalization from statistics, which are necessarily collected from the products of both passions. ”

“ In introducing you to the modern world it was entirely right and logical that he should dwell at first mainly upon the change in economic systems, for that has, of course, furnished the necessary material basis for all the other changes that have taken place. But I am sure that you will never meet any one who, being asked in what direction the progress of the race during the past century has tended most to increase human happiness, would not reply that it had been in the science of the soul and its relation to the Eternal and Infinite. ”

“ McCosh, but by the use of the term an argument is quietly instilled into the mind of the reader. President Porter, who also calls psychology the "science of the soul," is much more frank in his exposition. But, certainly, inasmuch as the immortality of the soul is something which we all hope psychology will demonstrate as a result of the examination of mental processes and powers, would it not be more satisfactory to every one and add to the value of our researches if we did not start out with assuming the point to be proved? ”

“ For everything that our present-day psychologist has to tell us—and here we refer not only to the systematic science but also in the wider sense to the physiognomic knowledge of men—relates to the present condition of the Western soul, and not, as hitherto gratuitously assumed, to “the human soul” at large. ”

“ Yet it is evident that the wealth-getting and wealth-using activities of man are strictly an outgrowth of his social life, and that economics as a science of human industry must rest upon sociology. Sometimes in the past the mistake has been made of supposing that economics dealt with the most fundamental social phenomena, and even at times economists have spoken of their science as alone sufficient to explain all social phenomena. It cannot be admitted, however, that we can explain social organization in general or social progress in terms of economic development. ”

“ Large, popular conceptions are never baseless. They are rooted in deep truths, felt rather than seen, and, however false and silly in external interpretation, may be trusted in their general trend. It is not that the virtue of chastity is so much more important to the race than the virtue of honesty, the virtue of courage, the virtues of cheerfulness, of courtesy, of kindness, but that upon the sex-relation in which we live depends so much of the further development and arrangement of our whole moral nature. ”

“ The joys of the soul are only a part of life; and they are no better or nobler than any other part.
You want to get rich in order that you may eat, drink, and be merry when it is time to do these things; in order that you may surround yourself with beautiful things, see distant lands, feed your mind, and develop your intellect; in order that you may love men and do kind things, and be able to play a good part in helping the world to find truth. ”

“ Man develops in mind, soul, and body by making use of things, and society is so organized that man must have money in order to become the possessor of things; therefore, the basis of all advancement for man must be the science of getting rich. ”

“ Wealth is a pitiless master who allows no other masters near him. The rich man cannot think of his soul, bowed as he is under the care of his riches, under his thirst to increase his riches, under the fear of losing his riches, under the material joys which are offered to him by those pieces of matter which are called wealth. ”

“ Can we compare houses and lands, gold or silver, or the wealth of the earth, to the salvation of the souls of men? What will a man not give for his own life? And what will it profit a man though he gain the whole world, if he at last lose his own soul? ”

“ If that is your experience blame the Economists, for the slice of life with which Economics has to deal vibrates and, so to say, bleeds with actuality. All science, all exploration, all history in its material factors, the whole epic of man’s effort to subdue the earth27 and establish himself on it, fall within the domain of the Economist. ”

“ In practice the study of “political” economy is mainly devoted to the sphere of the State; the welfare of the individual as a member of the State, and of the State in its relation to the world, being internal aspects of the prosperity of the State itself. Economics thus includes the discussion of all the numerous factors which make life profitable, whether to the nation or to the business, or to the individual man. ”