The Economist

“ The real assumption of the economist therefore is, as I think, simply the existence of a certain industrial organisation, which has a real existence as much as an army or a church; and there is no reason why his description should not be as accurate as the complexity of the facts allows. He is giving us the anatomy of society considered as a huge mechanism for producing and distributing wealth, and he makes an abstraction only in the sense that he is considering one set of facts at a time. ”

“ Such problems involve elements of which the Economist, purely as an Economist, is an incompetent judge; and the further we get from those questions in which purely economical considerations are dominant, towards those in which other factors become relevant,—from questions as to currency, for example, to questions as to the relations of capitalists and labourers,—the greater the inadequacy of our methods. ”

“ This comparison naturally can only be essentially materialistic, hence, for the economist all pleasure enters into the field of material satisfaction, that is, of political economy. Thus all the other social facts, from law to morals, come to have an economic basis. ”

“ The economist can only issue the warning that the commonest illusion he encounters is the belief of each class—commercial, banking, manufacturing, wage-earning—that what is for its particular interest is, in a peculiar manner, for the general interest, so much as to justify favoring legislation or special exemption from the general law, or even sheer lawlessness. ”

“ There is much in favour of the third definition, that which defines Political Economy as the art which teaches what production, distribution, accumulation, and consumption of wealth is most conducive to the happiness of mankind, and what are the habits and institutions most favourable to that production, distribution, accumulation, and consumption.
It raises the political economist to a commanding eminence. The most extensive, though perhaps not the most important, portion of human nature, lies within his horizon. ”

“ I should like to convince the economists as completely as I am convinced myself that their science is going off on a wrong tack. But I cannot trust myself to be able to show them the true course; it is a supreme effort—the most my mind will run to—to form a conception even of the actual organisation of society. ”

“ Nay, though capable of conceiving the idea of intrinsic value with respect to beasts of burden, no economist has endeavoured to state the general principles of National Economy, even with regard to the horse or the ass. ”

“ Economists argue against government restrictions on trade and manufacture.
The economists wrote treatises on taxation, scattered pamphlets about, and conducted a magazine or two. They not only brought the existing economic evils home to the intelligent reader, but suggested remedies for them. ”

“ Such remarks, now familiar enough, are enough to suggest that a full explanation of the economic phenomena would require reference to considerations which lie beyond the proper sphere of the economist. Yet the economist may urge that he is making a fair and perhaps necessary abstraction. He may consider the forces to be constant, although he may be fully aware that the assumption requires to be corrected when his formulæ are applied to facts. ”

“ If he reads the Economist, he will find that exhilarating print filled with complaints of general distress and want of demand; he will be startled from time to time by the announcement that in some places, such as Dundee, trade has experienced a most decided check; or that in others, such as Nottingham and Leicester, the operatives are applying by hundreds for admission to the workhouse! ”

“ In the same way, the economist describes the army of industry, and classifies its constituent parts. In order to explain their mutual relations, he has to make certain further assumptions, of which it would be rash to attempt a precise summary. He assumes as a fact, what has of course always been known, that scarcity implies dearness and plenty cheapness; that commodities flow to the markets where they will fetch the highest prices; that there is a certain gravitation towards equalisation of profits among capitalists, and of wages among labourers ”

“ It is not a general question of political economy, but only a particular question of local expediency, whether an article, in itself valueless, may bear a value of exchange in transactions with some other nation. The economist considers only the actual value of the thing done or produced ”

“ Now, no one who is conversant with systematic treatises on Political Economy will question, that whenever a political economist has shown that, by acting in a particular manner, a labourer may obviously obtain higher wages, a capitalist larger profits, or a landlord higher rent, he concludes, as a matter of course, that they will certainly act in that manner. ”

“ The reputation, however, of the economists is too well established to be affected, either by the clamours of the ignorant, or the mad intemperance of political alarmists. The doctrine of the great men who formed the school of the economists, was, that the produce of the land is the sole or principal source of the revenue and wealth of every country ”

“ Political economy, as it exists at present, resembles ontology: discussing effects and causes, it knows nothing, explains nothing, decides nothing. The ideas honored with the name of economic laws are nothing more than a few trifling generalities, to which the economists thought to give an appearance of depth by clothing them in high-sounding words. ”

“ Like most scientists, he'd probably considered himself a fair amateur economist, but he'd overlooked one of the most basic aspects of economy—the fact that governments also had to operate on enough of a profit to pay their executives and bond-holders. ”

“ If a political economist, for instance, finds himself puzzled by any recent or present commercial phenomena; if there is any mystery to him in the late or present state of the productive industry of the country, which his knowledge of principle does not enable him to unriddle; he may be sure that something is wanting to render his system of opinions a safe guide in existing circumstances. ”

“ The political economist of the later school has thoroughly carried out in his own person the economical law which he sees to be at the bottom of all industrial progress—that of obtaining the largest possible result at the least possible cost of labor. ”

“ It is the duty of the political economist to explain not only the conditions which determine progress in national wealth, but also the causes which tend to make the material state of a country either stationary or retrogressive. ”

“ It is true, no doubt, that in some cases there might be other arguments, and that the economists were apt to take a narrow view of the facts. Yet they decisively exploded many bad arguments, and by the right method of enforcing the necessity of tracing out the whole series of results. ”

“ Finally, a circumstance should be borne in mind which bears not only upon the intrinsic desirability of a regulative plan, but also upon the attitude of the general public and the consequent political and industrial possibilities. Economists are familiar with the difference between the phrase which they use in describing the new conditions, and that which is current in popular discussion. The economists speak of the "rise in prices"; the general public speaks of the "high cost of living." ”

“ The main task of the professional economist now consists, either in obtaining a wide knowledge of relevant facts and exercising skill in the application of economic principles to them, or in expounding the elements of his method in a lucid, accurate and illuminating way, so that, through his instruction, the number of those who can think for themselves may be increased. ”

“ An English political economist, like his countrymen in general, has seldom learned that it is possible that men, in conducting the business of selling their goods over a counter, should care more about their ease or their vanity than about their pecuniary gain. ”

“ Such is the opinion of a conservative economist with an especially kindly feeling towards the competitive system.
It would seem, therefore, that the competitive organization of industry has a tendency to crush out the weaklings. How numerous are these weaklings, we shall now discuss. ”

“ The common economist may to some extent neglect the inputs of the other disciplines, but the political economist must draw on the resources of philosophy, history, law, sociology, politicology, social psychology, biology, physics and so on. ”

“ In the department of economy, an act, a habit, an institution, a law, gives birth not only to an effect, but to a series of effects. Of these effects, the first only is immediate; it manifests itself simultaneously with its cause--it is seen. The others unfold in succession--they are not seen: it is well for us if they are foreseen. Between a good and a bad economist this constitutes the whole difference--the one takes account of the visible effect; the other takes account both of the effects which are seen and also of those which it is necessary to foresee. ”

“ And it is impossible to read the works of the economists who since the time of Smith have endeavored to build up and elucidate the science of political economy without seeing how, over and over again, they stumble over the law of wages without once recognizing it. Yet, “if it were a dog it would bite them!” Indeed, it is difficult to resist the impres216sion that some of them really saw this law of wages, but, fearful of the practical conclusions to which it would lead, preferred to ignore and cover it up, rather than use it as the key to problems which without it are so perplexing. ”

“ Elsewhere Say says, and repeats, that value being based on utility, and utility depending entirely on our needs, whims, customs, &c., value is as variable as opinion. Now, political economy being the science of values, of their production, distribution, exchange, and consumption,—if exchangeable value cannot be absolutely determined, how is political economy possible? How can it be a science? How can two economists look each other in the face without laughing? How dare they insult metaphysicians and psychologists? ”

“ Let it practice true and conscientious economy, not only in the expenditure and application of public moneys, but also in the method of levying them, so as to be equally just to all classes and all economical interests. ”

“ Thus, neither in its common meaning nor in the meaning expressly assigned to it in the current political economy, can profits have any place in the discussion of the distribution of wealth between the three factors of production. Either in its common meaning or in the meaning expressly assigned to it, to talk about the distribution of wealth into rent, wages, and profits is like talking of the division of mankind into men, women, and human beings. ”

“ We have surveyed the field of economical facts, and have examined how they stand related to one another as causes and effects; what circumstances determine the amount of production, of employment for labour, of capital and population; what laws regulate rent, profits, and wages; under what conditions and in what proportions commodities are interchanged between individuals and between countries. We have thus obtained a collective view of the economical phenomena of society, considered as existing simultaneously. ”

“ The works of the great economists on value, capital, supply and demand, wages, taxes, machinery, farm-rent, increase of population, over-accumulation of products, markets, banks, monopolies, etc., seem to have set the limit of dogmatic researches, and form a body of doctrine beyond which there is little to hope. ”

“ For many years before my election to Parliament, I had been continually receiving letters from strangers, mostly addressed to me as a writer on philosophy, and either propounding difficulties or communicating thoughts on subjects connected with logic or political economy. In common, I suppose, with all who are known as political economists, I was a recipient of all the shallow theories and absurd proposals by which people are perpetually endeavouring to show the way to universal wealth and happiness by some artful reorganization of the currency. ”

“ Therefore, not all things which have an exchange value are wealth, in the only sense in which the term can be used in Political Economy. Only such things can be wealth the production of which increases and the destruction of which decreases the aggregate of wealth. ”

“ These are the main problems of Political Economy. To solve, or attempt to solve them, we have to describe accurately the existing mechanism, and to suppose that it will regulate itself on the assumption which I have indicated as to demand and supply, the flow of capital and labour, and so forth. To go beyond these assumptions, and to justify them by psychological and other considerations, may be and is a most interesting task, but it takes us beyond the sphere of Economics proper. ”

“ Her economy was not the mean, penny-wise, pound foolish policy which many mistake for true economy. It was the art of calculation joined to the habit of order, and the power of proportioning our wishes to the means of gratifying them. ”

“ Shall we say that this is an ethical intrusion into the sphere of economics or shall we say that the former economic demand for labor "as such" has given place to an economic demand for labor better circumstanced or better paid? The community at all events is paying the increase of price or a part of the increase. It seems arbitrary to insist that the old price is still the economic price of the commodity and the increase only the price of a quiet conscience. The notion of a strictly economic demand for labor pure and simple seems in fact a concept of accounting. ”