Thorstein Veblen

“ The workman's force, ingenuity, and dexterity was the ultimate economic factor, - ultimate in a manner patent to the common sense of a generation habituated to the system of handicraft, how ever doubtful such a view may appear in the eyes of a generation in whose apprehension the workman is no longer the prime mover nor the sole, or even chief, efficient factor in the industrial process. ”

“ Of course, in no case and with no class does the discipline of the machine process mould the habits of life and of thought fully into its own image. There is present in the human nature of all classes too large a residue of the propensities and aptitudes carried over from the past and working to a different result. The machine's regime has been of too short duration, strict as its discipline may be, and the body of inherited traits and traditions is too comprehensive and consistent to admit of anything more than a remote approach to such a consummation. ”

“ The great business interests are the more inclined to look kindly on an extension of warlike enterprise and armaments, since the pecuniary advantages inure to them, while the pecuniary burden falls chiefly on the rest of the community. It is, to say the least, highly improbable that the business gains which accrue from a well-conducted foreign policy ever, in modern times, equal the cost at which they are secured; but that consideration scarcely enters, since the costs are not paid out of business gains, but out of the industry of the rest of the people. ”

“ It is in terms of price that he keeps his accounts, and in the same terms he computes his output of products. The vital point of production with him is the vendibility of the output, its convertibility into money values, not its serviceability for the needs of mankind. A modicum of serviceability, for some purpose or other, the output must have if it is to be salable. But it does not follow that the highest serviceability gives the largest gains to the business man in terms of money, nor does it follow that the output need in all cases have other than a factitious serviceability. ”

“ Irregularity, departure from standard measurements in any of the measurable facts, is of itself a fault in any item that is to find a use in the industrial process, for it brings delay, it detracts from its ready usability in the nicely adjusted process into which it is to go; and a delay at any point means a more or less far-reaching and intolerable retardation of the comprehensive industrial process at large. Irregularity in products intended for industrial use carries a penalty to the nonconforming producer which urges him to fall into line and submit to the required standardization. ”

“ So much is clear, that the keeping of the balance in the comprehensive machine process of industry is a matter of the gravest urgency if the productive mechanism is to proceed with its work in an efficient manner, so as to avoid idleness, waste, and hardship. The management of the various industrial plants and processes in due correlation with all the rest, and the supervision of the interstitial adjustments of the system, are commonly conceived to be a work of greater consequence to the community's well-being than any of the detail work involved in carrying on a given process of production. ”

“ The "natural," conventional freedom of contract is sacred and inalienable. De facto freedom of choice is a matter about which the law and the courts are not competent to inquire. By force of the concatenation of industrial processes and the dependence of men's comfort or subsistence upon the orderly working of these processes, the exercise of the rights of ownership in the interests of business may traverse the de facto necessities of a group or class; it may even traverse the needs of the community at large, as, e.g., in the conceivable case of an advisedly instituted coal famine ”

“ He learns to think in terms of the process, rather than in terms of a productive cause and a product between which the process intervenes in such a manner as to afford a transition from one to the other. The process is always complex; always a delicately balanced interplay of forces that work blindly, insensibly, heedlessly; in which any appreciable deviation may forthwith count in a cumulative manner, the further consequences of which stand in no organic relation to the purpose for which the process has been set going. ”

“ Now, business enterprise and the machine process are the two prime movers in modern culture; and the only recourse that holds a promise of being effective, therefore, is a recourse to the workings of business traffic. And this is a question, not of what is conceivably, ideally, idyllically possible for the business community to do if they will take thought and act advisedly and concertedly toward a chosen cultural outcome, but of what is the probable cultural outcome to be achieved through business traffic carried on for business ends, not for cultural ends. ”

“ But those elements in the industrial world that take the initiative and exert a far-reaching coercive guidance in matters of industry go to their work with a view to profits on investment, and are guided by the principles and exigencies of business. The business man, especially the business man of wide and authoritative discretion, has become a controlling force in industry, because, through the mechanism of investments and markets, he controls the plants and processes, and these set the pace and determine the direction of movement for the rest. ”

“ Instead of contrasting the well-to-do with the indigent, the line of demarcation between those available for the socialist propaganda and those not so available is rather to be drawn between the classes employed in the industrial and those employed in the pecuniary occupations. It is a question not so much of possessions as of employments; not of relative wealth, but of work. It is a question of work because it is a question of habits of thought, and work shapes the habits of thought. The socialists themselves construe the distinction to be a distinction in respect of habits of thought ”

“ That is to say in other words, the absorption of goods and services by extra-industrial expenditures, expenditures which as seen from the standpoint of industry are pure waste, would have to go on in an increasing volume. If the wasteful expenditure slackens, the logical outcome should be a considerable perturbation of business and industry, followed by depression; if the waste on war, colonization, provincial investment, and the like, comes to an abrupt stop, the logical consequence, in the absence of other counteracting factors, should be a crisis of some severity. ”

“ The intellectual and spiritual training of the machine in modern life, therefore, is very far-reaching. It leaves but a small proportion of the community untouched; but while its constraint is ramified throughout the body of the population, and constrains virtually all classes at some points in their daily life, it falls with the most direct, intimate, and unmitigated impact upon the skilled mechanical classes, for these have no respite from its mastery, whether they are at work or at play. ”

“ The phenomenon of a uniform rate of profits determined by competition has fallen into the background and lost something of its matter-of-fact character since competition in the large industry has begun to shift from the position of a stable and continuous equilibration to that of an intermittent, convulsive strain in the service of the larger business men's strategy. The interest of the business community centres upon profits and upon the shifting fortunes of the profit-maker, rather than upon accumulated and capitalized goods. ”

“ There is, on the one hand, such a possibility as overstocking the market with any given line of goods, to the detriment of the business man concerned, but not necessarily to the immediate disadvantage of the body of consumers. And there are, on the other hand, certain lines of industry, such as many advertising enterprises, the output of which may be highly effective for its purpose but of quite equivocal use to the community. ”

“ It is in the industrial corporations that this capitalization of good-will is seen to the best advantage - including, under the term "industrial corporations," railway companies, iron and steel concerns, mines, etc., as well as what are known in the stock market specifically as "industrials." The corporation is, of course, not the only form of business concern in the industrial field, but it is the typical, characteristic form of business organization for the management of industry in modern times, and the peculiarities of modern capital are therefore best seen in these modern corporations. ”

“ None of the processes in the mechanical industries is self-sufficing. Each follows some and precedes other processes in an endless sequence, into which each fits and to the requirements of which each must adapt its own working. The whole concert of industrial operations is to be taken as a machine process, made up of interlocking detail processes, rather than as a multiplicity of mechanical appliances each doing its particular work in severalty. ”

“ Such an extreme iconoclastic position, which would overtly assert the mechanical standardization of industry as against the common-law standardization of business, seems to be the logical outcome to which the trade-union animus tends, and to which some approach has latterly been made by more than one trade-unionist body, but which is, on the whole, yet in the future, if, indeed, it is to be reached at all. ”

“ War and preoccupation with warlike enterprise breed a warlike animus in the community, as well as a habit of arbitrary, autocratic rule on the part of those in authority and an unquestioning, enthusiastic subservience on the part of the subjects. National animosity and national pride demand more and more of military standing, at the same time that the growing official class needs increasing emoluments and a larger field of employment and display. The cultural effects of the discipline of warfare and armament are much the same whether it is undertaken for drastic or for business ends ”

“ Industry is controlled by business exigencies and is carried on for business ends. The effects of a wide disturbance in business, therefore, reach the industrial processes pretty directly, and the consequences, in the way of an expansion or curtailment of industrial activity and an enlarged or shortened output of product, are, of course, both immediate and important. As a primary effect, on the industrial side, of an era of prosperity, the community gains greatly in aggregate material wealth. The gain in material wealth, of course, is not equably distributed ”

“ The items of the equipment (plant, materials, and in a measure even good-will) in which any industrial enterprise invests, and by the use of which the business men in industry turn out their output of vendible goods, are themselves products of the machine industry. Machine processes, ever increasing in efficiency, turn out the mechanical appliances and materials with which the processes are carried on, at an ever decreasing cost; so that at each successive step the result is a process having a higher efficiency at a lower cost. ”

“ In those modern communities whose hearts beat with the pulsations of the world-market they find expression in an enthusiasm for the commercial aggrandizement of the nation's business men, But when once the policy of warlike enterprise has been entered upon for business ends, these loyal affections gradually shift from the business interests to the warlike and dynastic interests, as witness the history of imperialism in Germany and England. ”

“ The keeping of the industrial balance, therefore, and adjusting the several industrial processes to one another's work and needs, is a matter of grave and far-reaching consequence in any modern community, as has already been shown. ”

“ Crises, depressions, hard times, dull times, brisk times, periods of speculative advance, "eras of prosperity," are primarily phenomena of business; they are, in their origin and primary incidence, phenomena of price disturbance, either of decline or advance. It is only secondarily, through the mediation of business traffic, that these matters involve the industrial process or the livelihood of the community. They affect industry because industry is managed on a business footing, in terms of price and for the sake of profits. ”

“ When distrust of business principles rises to such a pitch as to become intolerant of all pecuniary institutions, and leads to a demand for the abrogation of property rights rather than a limitation of them, it is spoken of as "socialism" or "anarchism." This socialistic disaffection is widespread among the advanced industrial peoples. No other cultural phenomenon is so threatening to the received economic and political structure; none is so unprecedented or so perplexing for practical men of affairs to deal with. ”

“ Whatever the forces at work in the modern situation may eventually bring to pass, therefore, the outcome must touch all communities in the same way and in approximately the same degree. If the outcome is dynastic politics and armament again played to a finish in popular squalor, aristocratic virtues, and universal bankruptcy, there will be no peaceable community of matter-of-fact mechanics and shopkeepers left in reserve from which to make a new cultural and industrial start. ”

“ The higher exigencies of the captain of industry's personal fortunes, as distinct from those of the corporation controlled by him, may from time to time be best sewed by an apparent, if not an actual, mismanagement of industrial affairs. A convincing appearance of decline or disaster will lower the putative earning-capacity of the concern below its real earning-capacity and so will afford an advantageous opportunity for buying with a view to future advance or with a view to strategic control. ”

“ It might, therefore, be feasible to set up a theory to the effect that wages are competitively proportioned to the vendibility of the product; but there is no cogent ground for saying that the wages in any department of industry, under a business regime, are proportioned to the utility which the output has to any one else than the employer who sells it. ”

“ 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. ”