Frederick L. Lipman

“ Now money-making and money values occupy a special place in business enterprise, due to the fact that on economic principles such money value becomes the best test—perhaps the only true test—of the workableness and success of business efforts. In the complicated activities of the world's work, where each man, each undertaking, each business unit, respectively, is striving primarily for its own advantage, how is it, among all this pulling and pushing, this competition, that the social income is distributed so nearly in accordance with the individual contribution? ”

“ It is self-indulgence, we must conclude, that is to be overcome if we are to meet this responsibility in a manly way, visualizing it with sufficient clearness to see that thrift, the creation of capital for one's self and for the race, comes into no necessary conflict with any other proper aim in life, but on the contrary constitutes a fundamental duty to society, to the state, to one's family, to his own future, to his self-respect. ”

“ Doubtless there are many workmen who follow a more rational course, who are reaping and storing the harvest for the comfort and security of themselves and their families during the winter of life. Could any one think that this policy involved an aim that was sordid, tending to draw them down, and away from higher considerations of life? Certainly a course of careful planning in one's affairs would be in so far a better course and on a higher plane than indulgence in idleness or shiftless expenditure of surplus for present luxuries, regardless of future need. ”

“ Now we recognize high wages, considered in itself, as beneficial to the community, for it gives opportunity, at least, for comforts in life and a provision for the future that otherwise would be lacking. But if prices have advanced as much as wages, the apparent improvement to the laborer is merely in nominal wages, while that which alone can benefit him is higher real wages. Now let us see what the workman could do to advance real wages as contrasted with nominal wages.
What will be the effect on prices of the use of surplus earnings during a period of high wages? ”

“ Even if we admit that many persons fail to get a fair share, that there is gross inequality here and there, still after all, a student of mankind's activities in production, distribution, and consumption must marvel at the extent to which the rewards approximate the value of contribution. Now this is made possible by money considered as a measure of relative values, by the standard or test of fitness embodied in the thought, Will it pay, and to what extent will it pay? ”

“ We commonly feel free to criticize a railroad, a newspaper, a large business house, perhaps a university, with which we may have casual contact, but the fact is there are few competent critics outside of the ranks of the enterprise itself or of those carrying on activities that are directly similar. In a word, through this focusing of attention, a man will come to be exhaustively familiar with his own occupation, while possessing a merely superficial acquaintance with the theories, customs, and responsibilities of those of others. ”

“ Thus we contrast profits and patriotism; enriching one's self and philanthropy; getting all the law allows and justice; taking advantage of the other fellow and honesty; becoming engrossed in acquisition and love of family. Now, such contrasts obviously prove nothing more than that money-making is and would be a vicious aim if pursued regardless of these virtues, and it could well be replied that consideration of patriotism, philanthropy, love of family, etc., must in themselves impel one to earn and to save. ”

“ How many persons are to be found among one's acquaintance who feel and act upon any responsibility for doing their "bit" in the creation of capital? Very few. Rather than exert himself to work with this in view, on the one hand, and to abstain from unnecessary consumption, on the other hand, the ordinary man will make to himself every excuse. He will contemn money-making as a sordid aim, readily exaggerating itself into a vice ”

“ In buying and selling, in aiming to obtain the most favorable terms for each line of his activity, in meeting conditions of competition, in all these relations, the business man is endeavoring to better himself and may doubtless be tempted here and there to forget the interests of the other party to the transaction. But to yield to such temptation would merely be to abuse a principle which on the whole is sanctioned by the requirements of economic efficiency. ”

“ We have found, on the other hand, that apart from men in charge of business enterprise, the burden of providing thus for man's welfare and development is assumed by very few, the vast majority, whether in professional or business employment, treating it with neglect and contempt. They think, perhaps, that they are aiming at higher things, or that their efforts would not sufficiently count, or they do not give the matter any sturdy thought; while the underlying motive, often unconscious, is simply an unwillingness to practice self-restraint. ”

“ Again, consider the nation that has attempted to improve on economic distribution of power by evolving a government which places the power in the hands of those best fitted to govern, a ruling class which aims directly at efficiency, a select class but necessarily self-selected, thus supplanting an economic régime by a military régime—successful truly in certain forms of economic efficiency through a more rigid and compact organization, but destructive of the initiative, the evolutionary growth, the fundamental development, the liberties of the people. ”

“ Concentration upon service tends to make a man relatively efficient therein, but argues a relative unfamiliarity with the field of others, from which we infer the advisability of confining one's activity to the thing he has learned to do best. As an example of this, he should avoid placing his surplus capital or savings in outside enterprises where they will partake of risks that are unknown to him, nor should he attempt to employ his savings at all with the purpose of making money, unless, indeed, he can use them as capital in his own business. ”

“ I believe them to be rare, but whether there are many of them to-day or not, it is a type tending to disappear in the environment of modern business which offers its inducements and rewards to him who does, who becomes, who renders service, not to the sordid seeker for gain. Barring an occasional exception, such an exclusive aim is not that of the man of large affairs, the business leader, the conspicuously successful man. ”

“ What are the considerations to be observed by a man in deciding whether or not he should adopt money-making—that is, the acquisition of a surplus beyond his current needs—as one of his definite aims in life? ”

“ Indeed, the world scorns him who cannot or will not support himself and his family. But this is only to say that one must work to-day to meet the expenditures of to-day. Is this the limit? Is it a virtue for him to work in order to spend, but a vice for him to work in order to save? ”

“ And so in the economic world it is the whole life period which is to be regarded when aims are chosen. Profits as a goal for the long run do not antagonize moral principles. "Honesty is the best policy" and "Do unto others as you would have others do unto you" are maxims of good business; and that economic principles do not conflict with them is shown by the fact that they tend towards profits in the long run. This is not to assert that mankind in business is perfect. ”

“ Perhaps a man may err in excessive devotion to any object of life but we must admit that in the pursuit of gain the evil tendency to exaggerated absorption in the one aim is promoted through a coöperation with his natural selfishness. Of all the fields of human endeavor, here is one that peculiarly fits in with self-seeking, with disregard for others, which may drag a man downward, making him small and mean, unhappy and uncharitable, while apparently attaining the goal at which he has aimed. ”

“ The business enterprise then directs its attention to profits, because, from mere economic necessity, profits are the criterion of the true success of the enterprise, that is, its serviceability to mankind. Here we distinguish between the shortsighted man, who aims at immediate returns, and the farsighted man, whose eye is fixed on the future, who verily desires the profits, but desires them in the long run. ”

“ We turn now from the mass of mankind, on the whole so singularly neglectful of these responsibilities, to the few in number who constitute the creators of capital, to whom are due so much of the comforts, the conveniences, and the material advantages that go to make civilized life possible. ”

“ We refer to the practice in trade of leaving to each individual, to each enterprise, to each organization, the responsibility for looking out for its own interests when having dealings with others. Caveat emptor—let the buyer beware—expresses an extreme development of this, and in its common signification, that each side is to be permitted and expected to take any advantage of the other side that it may be able to secure, it describes a state of warfare rather than of business. ”

“ But these savings of the past were accumulated, after all, by comparatively few of the workers; not by the many, who lived from hand to mouth, happy-go-lucky, spending and enjoying in time of abundance, suffering in time of poverty and stress, making no provision even for their own future, still less recognizing any duty to their country or to posterity to produce economically and regulate their expenditure wisely so as to carry forward a surplus. ”

“ Not every man, while concentrating upon money-making, is consciously seeking his country's welfare, the amelioration of life for the many, the uplift of posterity, even if he rigidly adheres to the accepted rules of the game, to the code of business honor. ”

“ The experienced man knows well that this holds just as truly for all ranks in the business world and that the higher one ascends in responsibilities, the more he must give and do; indeed the leading positions in the business world are occupied by men who produce tremendously, whose value to themselves and others lies in what they accomplish, and this—not what they get—is the criterion of success among men of experience, among those in charge of enterprises, who are on the lookout for leaders of this type. ”

“ Now this economic régime, with its individual instances of cruelty, like the cruelties of nature, does on the whole tend to develop men, to require their best efforts, to make them come forward and upward. Thus, in this interplay of economic forces, wealth, or money, or profits stands out as a primary object of attainment, and becomes the incentive to the complex efforts which tend to benefit the individual, the community, and the nation. ”

“ People who work for salaries or wages seem characteristically to use up all their earnings in their current expenditure, to live up to their incomes without any serious attempt to save. If they pride themselves upon trying to keep out of debt, it is as much as they expect of themselves, and among them the man who attempts to go beyond this in his money affairs is certainly the exception. ”

“ Such men are money-makers, creators of capital, builders of large enterprise, but their aim at profits while genuine is only incidental to their main purpose of doing, of becoming better able to achieve, of rendering service. When the beginner in business approaches an experienced friend for advice, he is told to work as hard and as faithfully as possible, to study his business, to seek to improve himself—in other words, to concentrate his whole strength on the giving of service, for his wages or salary will take care of itself. ”

“ If A has a house for sale and B is a prospective buyer, the essence of the possible transaction between the two is that A's idea of the value of the property is different from B's idea of that value; or at any rate that A sees less value in it to him than does B to B. This is of course typical of all business transactions—the seller desires the money above the commodity, the buyer prefers the commodity to the money. The seller and the buyer each dwells naturally upon his own idea of value. ”

“ And so with the department manager, and so with the general manager, whether of a store, a railroad company, or other activity; the immediate daily problem for all lies in the rendering of a service, the producing of a commodity, or the doing of the thing for which the business enterprise exists. This concentration upon output is furthermore required by competition which whips the producer into line and often makes it a matter of business life and death that one should make progress in method and quality. That his shoes wear is a matter of pride to the shoe manufacturer. ”

“ As a matter of course, the employment as additional capital in one's own enterprise is generally the most desirable wherever applicable, but this is a use of limited scope, relating to but few of the people engaged in productive activity who earn and save a surplus. The main resource for such accumulations is in safe investments, in the bonds and securities of our own country and those of well established enterprises. Not many among our embryo capitalists possess the experience or skill requisite for the safe and proper investment of their funds, they must rely upon the advice of others. ”

“ Or, putting it more simply, in time of high wages the worker ought to produce as much as possible and consume as little as possible, both influences tending to increase the stock of commodities for his ultimate gain and for that of the community.
In fact, a high level of prices may be due measurably to some wasting of the world's capital—as in war, for instance—and then the only antidote is to restore the capital, a movement that would doubtless occur anyway in time but which could be greatly accelerated through a general adoption of habits of thrift and saving throughout a community. ”

“ Preëminent in the class of the thrifty we think of the man of affairs; the business enterprise indeed is supposed to be the money-maker, par excellence. Money-making is in fact considered as its raison d'être; it is as a money-maker that the business man is contemned by some and envied by many. ”

“ Universities, churches, libraries, parks, are included in the wealth thus handed down to us. Our lives to-day may be richer and broader through this inheritance created by the industry and abstinence of our forefathers. Their business careers, now closed, we regard as the more successful in that they earned and saved a surplus, that they had a net income to show as the result of their work. ”

“ The young man starting out in life may be as negligent of his opportunities as the workman who quits at the end of the fourth day. Or if he devotes himself properly to his vocation he may consume his earnings in current self-gratification. If, however, he will both concentrate on his work and practice self-restraint with the purpose of creating a saved surplus, all will agree in considering him as so far headed on the road towards success. ”