The paradox of prosperity: When waste becomes the engine of wealth

“ Our competitive system is largely an endeavour to make profits out of the sale of trashy articles, the production of which wastes alike {252} the labour engaged in making them and the labour for which they are exchanged. It is difficult to say which is more pitiable, the waste of labour upon rubbish designed for the consumption of the poor, or the waste of labour upon luxuries designed for the consumption of the rich. ”

“ From the foregoing survey of the growth of conspicuous leisure and consumption, it appears that the utility of both alike for the purposes of reputability lies in the element of waste that is common to both. In the one case it is a waste of time and effort, in the other it is a waste of goods. ”

“ Throughout the entire evolution of conspicuous expenditure, whether of goods or of services or human life, runs the obvious implication that in order to effectually mend the consumer's good fame it must be an expenditure of superfluities. In order to be reputable it must be wasteful. No merit would accrue from the consumption of the bare necessaries of life, except by comparison with the abjectly poor who fall short even of the subsistence minimum; and no standard of expenditure could result from such a comparison, except the most prosaic and unattractive level of decency. ”

“ As the priestess of the temple of consumption, as the limitless demander of things to use up, her economic influence is reactionary and injurious. Much, very much, of the current of useless production in which our economic energies run waste—man’s 121strength poured out like water on the sand—depends on the creation and careful maintenance of this false market, this sink into which human labor vanishes with no return. ”

“ We have seen that the channels into which the labor and capital of the people are to be diverted are offered by the industries which do not pay. Hence protectionism is found to mean that national prosperity is to be produced by forcing labor and capital into employments where the capital cannot be reproduced with the same increase which could be won by it elsewhere. If that is so, then capital in those employments will be wasted, and the final outcome of our investigation, which must be made the primary maxim of the art of national prosperity under protectionism, is that Waste makes Wealth. ”

“ Quite true; but tell me, thou resounding ministerial vacuum, thou unreflecting editorial parrot, where is its product? What has society to show for the expenditure of this energy? A hole in its working capital—a hiatus in its larder caused by employing and sustaining labor, not to produce but to destroy. Prodigality on the part of the rich personally benefits a few parasites, just as the bursting of a molasses barrel fattens useless flies; but waste, by reducing the amount of wealth available for reproduction, breeds general want. ”

“ Leisure held the first place at the start, and came to hold a rank very much above wasteful consumption of goods, both as a direct exponent of wealth and as an element in the standard of decency, during the quasi-peaceable culture. From that point onward, consumption has gained ground, until, at present, it unquestionably holds the primacy, though it is still far from absorbing the entire margin of production above the subsistence minimum. ”

“ I have been assured by an observant housewife that certain articles do now and again appear upon the market specially designed to safeguard by little constructive devices, the main point of wear-and-tear through which they become useless, and that presently these things disappear and are unobtainable, presumably because they prove too lasting, and so are “bad for trade.” And they are allowed to disappear because we, as a community, have not sufficiently set our hearts and minds against waste and uselessness. ”

“ The prestigiousness of mediocre objects of this kind is solely due to the fact that they have been placed, however briefly, at the center of social life and hailed as a revelation of the unfathomable purposes of production. But the object that was prestigious in the spectacle becomes mundane as soon as it is taken home by its consumer — and by all its other consumers. Too late, it reveals its essential poverty, a poverty that inevitably reflects the poverty of its production. ”

“ It is obviously not necessary that a given object of expenditure should be exclusively wasteful in order to come in under the category of conspicuous waste. An article may be useful and wasteful both, and its utility to the consumer may be made up of use and waste in the most varying proportions. Consumable goods, and even productive goods, generally show the two elements in combination, as constituents of their utility; although, in a general way, the element of waste tends to predominate in articles of consumption, while the contrary is true of articles designed for productive use. ”

“ An eminent political economist, to whom I once confided my aversion for such butler's and lady's-maid's ideals of life, admonished me that although useless possessions, unenjoyable luxury, ostentation, and so forth, undoubtedly represented a waste of the world's energies and resources, they should nevertheless be tolerated, inasmuch as constituting a great incentive to industry. People work, he said, largely that they may be able to waste. If you repress wastefulness you will diminish, by so much, the production of wealth by the wasteful, by the luxurious and the vain.... ”

“ These extra-industrial expenditures that have brought prosperity are here spoken of as wasteful, not thereby implying that they may not be beneficial to the community even in respect to their effect upon the aggregate income or the aggregate accumulation of wealth in the community. They are called wasteful simply because these expenditures directly, in their first incidence, merely withdraw and dissipate wealth and work from the industrial process, and unproductively consume the products of industry. ”

“ The resources of Nature are gratuitous; they are practically exhaustless; and, as the activity of capital and the energy of labor are not fixities, large consumption or demand (Mr. Leland talks of wasteful consumption as if the word "wasteful" were mine) stimulates the energy of capitalists, leads to the application of improved machinery, brings about better transportation, so that as a result all, or nearly all, products are proportionately increased in abundance because of extended consumption, and the possibilities of consumption. ”

“ But large consumption is a powerful agent in securing minimum of cost in production; it brings in competition, it leads to the invention of machinery and improved methods of production or manufacture—in fact, minimum of cost is never reached except in those things that are in general use. Consumption or demand leads, therefore, as a rule, not only to greater abundance, but to greater cheapness. But I do not mean, and I did not speak of, wasteful destruction, which Mr. Leland dwells upon so much, but of use. Waste is foolish, in the first place, because it confers no good upon any one ”

“ Labour being thus various in its result, the prosperity of any nation is in exact proportion to the quantity of labour which it spends in obtaining and employing means of life. Observe, -- I say, obtaining and employing; that is to say, not merely wisely producing, but wisely distributing and consuming. Economists usually speak as if there were no good in consumption absolute. (27*) So far from this being so, consumption absolute is the end, crown, and perfection of production; and wise consumption is a far more difficult art than wise production. ”

“ In such a society the productive machinery is never used to the full. The machinery is controlled by a profit-seeking interest, seeking an opportunity to make sales, and restricting production according to the prospect of sales. So the actual product bears no relationship to the possible product, and people who live in an exploiting society can form no conception of true prosperity. ”

“ The process of wasting the surplus profits in competition and luxury was slow and protracted, and meanwhile productive industry languished and the workers waited in idleness and want for the surplus to be so far reduced as to make room for more production. ”

“ What a country wants to make it richer, is never consumption, but production. Where there is the latter, we may be sure that there is no want of the former. To produce, implies that the producer desires to consume; why else should he give himself useless labour? He may not wish to consume what he himself produces, but his motive for producing and selling is the desire to buy. Therefore, if the producers generally produce and sell more and more, they certainly also buy more and more. ”

“ As regards the prosperity of the community in the future it is important that goods should be consumed in such a fashion as to secure that they shall be replaced or increased before they are used up; it is the amount of production rather than the amount of consumption that demands consideration, and gives indication of growth or of decadence. ”

“ In the industrial evolution of the human race, that marvellous and subtle drawing out and interlocking of special functions which constitute the organic life of society, we find that production and consumption go hand in hand; and production comes first. One cannot consume what has not been produced. Economic production is the natural expression of human energy,—not sex-energy at all, but race-energy,—the unconscious functioning of the social organism. Socially organized human beings tend to produce, as a gland to secrete: it is the essential nature of the relation. ”

“ Then, though production may equal consumption, it never can exceed it; for there is no real production save where there is a production of utility, and there is no utility save where there is a possibility of consumption. Thus, so much of every product as is rendered by excessive abundance inconsumable, becomes useless, valueless, unexchangeable,—consequently, unfit to be given in payment for any thing whatever, and is no longer a product. ”

“ But foreign economists have very ingeniously used the fact "that consumption bestows value on production," not only to justify the policy of sustaining by social institutions a class of useful mental labourers, but also to justify all the modes for transferring property or profit from useful labour, whether physical or moral, to useless and pernicious immoral labour, upon the ground, that it is beneficial in society that it should contain a class of consumers to bestow value on consumptions. ”

“ Everybody is piling his goods on to the market with a reckless disregard for the morrow. There is no attempt to gauge capacity of consumption; there is no effort made to ascertain where the balance between supply and demand is fixed. The result is a choking of the market, depression in trade, unemployment, financial loss and bankruptcy. So incompetent is present-day society to handle stocks of commodities and distribute them that when nature happens to be in a generous mood and supplies rich harvests, distress as often follows as prosperity. ”

“ Louis Blanc tell us again, that competition leads to monopoly, and that, for the same reason, cheapness leads to exorbitant prices? That competition tends to drain the sources of consumption, and urges production to a destructive activity? That competition forces production to increase, and consumption to decrease;--whence it follows that free people produce for the sake of not consuming; ”

“ Old work-places are closed, production is regulated and organised, profits are guaranteed when works are idle, economies in management are effected, processes of manufacture are specialised and differentiated. The waste involved in competitive industry is enormous, and the sheer force of circumstances is tending to eliminate it.
4. Waste of Labour.
One further consideration must be noted. We have seen that the private ownership of land and capital is a serious drain upon national wealth and a heavy burden upon national production. ”

“ The only prosperity worth having is that which affects the mass of the people. We are bound to strive for the fair distribution of prosperity. But it behooves us to remember that there is no use in devising methods for the
proper distribution of prosperity unless the prosperity is there to distribute. I hold it to be our duty to see that the wage-worker, the small producer, the ordinary consumer, shall get their fair share of the benefit of business prosperity. ”

“ Trade statistics indicate that this country is in a state of unexampled prosperity. The figures are almost appalling. They show that we are utilizing our fields and forests and mines and that we are furnishing profitable employment to the millions of workingmen throughout the United States, bringing comfort and happiness to their homes and making it possible to lay by savings for old age and disability. That all the people are participating in this great prosperity is seen in every American community and shown by the enormous and unprecedented deposits in our savings banks. ”

“ If the wealth resulting from prosperous industry is to be spent upon the gratification of unworthy desires, if the increasing perfection of manufacturing processes is to be accompanied by an increasing debasement of those who carry them on, I do not see the good of industry and prosperity. ”

“ It is mere folly to try to dig up the dead past, and scant is the good that comes from asceticism and retirement from the world. But let us make sure that our progress is in the essentials as well as in the incidentals. Material prosperity without the moral lift toward righteousness means a diminishing capacity for happiness and a debased character. The worth of a civilization is the worth of the man at its centre. When this man lacks moral rectitude, material progress only makes bad worse, and social problems still darker and more complex. ”

“ It is only the statement of the truism in moral and in political economy, that true prosperity can never grow up from wrong and wickedness. That pauperism, and ignorance, and vice, that reckless habits, and debasing customs, and barbarous manners should come of an organized degradation of labor, and of cruelty and injustice crystallized into an institution, is an inevitable necessity, and strictly according to the nature of things. ”