Reason of this Work
I shall try in this work to put in clear and systematic form the main principles of political economy.
The place I would take is not that of a teacher, who states what is to be believed, but rather that of a guide, who points out what by looking is to be seen. So far from asking the reader blindly to follow me, I would urge him to accept no statement that he himself can doubt, and to adopt no conclusion untested by his own reason.
This I say, not in unfelt deprecation of myself nor in idle compliment to the reader, but because of the nature and present condition of political economy.
Of all the sciences, political economy is that which to civilized men of today is of the most practical importance. For it is a science which treats of the nature of wealth and the laws of its production and distribution; that is to say, of matters which absorb the larger part of the thought and effort of the vast majority of us — the getting of a living. It includes in its domain the greater part of those vexed questions which lie at the bottom of our politics and legislation, of our social and governmental theories, and even, in larger measure than may at first be supposed, of our philosophies and religions. It is a science to which must belong the solving of problems that are in all civilized countries clouding the horizon of the future — the only science that can enable our civilization to escape already threatening catastrophe.
Yet, surpassing in its practical importance as political economy is, he who today would form clear and sure ideas of what it really teaches must form them for himself. For there is no body of accepted truth, no consensus of recognized authority, that he may without question accept. In all other branches of knowledge properly called science the inquirer may find certain fundamentals recognized by all and disputed by none who profess it, which he may safely take to embody the information and experience of his time. But, despite its long cultivation and the multitude of its professors, he cannot yet find this in political economy. If he accepts the teaching of one writer or one school, it will be to find it denied by other writers and other schools. This is not merely true of the more complex and delicate questions, but the primary questions. Even on matters such as in other sciences have long since been settled, he who today looks for guidance of general acceptance in political economy will find a chaos of discordant opinions. So far indeed are first principles from being agreed on, that it is still a matter of hot dispute whether protection or free trade is most conducive to prosperity — a question that in political economy ought to be capable of as certain an answer as in hydrodynamics the question of whether a ship ought to be broader than she is long, or longer than she is broad.
But while this discordance shows that he who would really acquaint himself with political economy cannot rely upon authority, there is in it nothing to discourage the hope that he who will use his own reason in the honest search for truth may attain firm and clear conclusions.
For in the supreme practical importance of political economy he may see the reason that has kept and still keeps it in dispute. Under existing conditions in the civilized world, the great struggle among men is for the possession of wealth. Would it not then be irrational to expect that the science which treats of the production and distribution of wealth should be exempt from the influence of that struggle? Macaulay has well said that if any large pecuniary interest were concerned in disputing the attraction of gravitation, that most obvious of all facts would not yet be accepted. What, then, can we look for in the teaching of a science which directly concerns the most powerful of "vested rights" — which deals with rent and wages and interest, with taxes and tariffs, with privileges and franchises and subsidies, with currencies and land tenures and public debts, with the ideas on which trade unions are based and the pleas by which combinations of capitalists are defended? Economic truth, under existing conditions, has not merely to overcome the inertia of indolence or habit; it is in its very nature subject to suppressions and distortions from the influence of the most powerful and vigilant interests. It has not merely to make its way; it must constantly stand on guard.
It is especially true today that all large political questions are at bottom economic questions. In the study of theology, the same disturbing element has written in blood a long page in the world's history — and at one time, at least, it so affected even the study of astronomy as to prevent the authoritative recognition of the earth's movement around the sun.
Colleges and universities and similar institutions, though ostensibly organized for careful investigation and the honest promulgation of truth, cannot be exempt from the influences that disturb the study of political economy. For in the present social conditions of the civilized world nothing is clearer than that there is some deep and widespread wrong in the distribution, if not in the production, of wealth. To disclose this is the task of political economy, and a really faithful and honest explication of the science must disclose it.
But no matter what the injustice may be, colleges and universities, as at present constituted, are by the very law of their being precluded from discovering or revealing it. For no matter what the nature of this injustice, the wealthy class must, relatively at least, profit by it, and this is the class whose views and wishes dominate in colleges and universities. As, while slavery was yet strong, we might have looked in vain to the colleges and universities in our Southern states, and indeed for that matter in the North, for any admission of its injustice, so under present conditions we must look in vain to such sources for any faithful treatment of political economy. Whoever accepts from them a chair of political economy must do so under the implied stipulation that he shall not really find what it is his professional business to look for.
In these extraneous difficulties, and not in any difficulty inherent in political economy itself, lies the reason why he who would really know what it teaches can find no body of doctrine that he may safely accept.
Yet if political economy be the one science that cannot safely be left to specialists, the one science of which it is needful for all to know something, it is also the science which the ordinary man may most easily study. It requires no tools, no apparatus, no special learning. The phenomena which it investigates need not be sought for in laboratories or libraries; they lie about us, and are constantly thrust upon us. The principles on which it builds are truths of which we are all conscious, and on which in everyday matters we constantly base our reasoning and our actions. And its processes, which consist mainly in analysis, require only care in distinguishing what is essential from what is merely accidental.
In proposing to my readers to go with me in an attempt to work at the main principles of political economy, I am not asking them to think of matters they have never thought of before, but merely think of them in a careful and systematic way. For we all have some sort of political economy. Men may honestly confess an ignorance of astronomy, of chemistry, of geology, of philology, but few honestly confess an ignorance of political economy. Though they may admit or even proclaim ignorance, they do not really feel it. There are many who say that they know nothing of political economy — many indeed do not know what the term means. Yet these very men hold with the utmost confidence opinions upon matters such as the causes which affect wages and prices and profits, the effects of tariffs, the influence of labor-saving machinery, the function and proper substance of money, the reason of "hard times" or "good times," and so on. For men living in society must have some sort of politico-economic theories — good or bad, right or wrong. The way to make sure that these theories are correct, or if they are not correct, to supplant them by true theories, is by such systematic and careful investigation as in this work I propose.
But to such investigation there is one thing so necessary, one thing of such primary and constant importance, but I cannot too soon and strongly urge it upon the reader. It is, that in attempting the study of political economy we should first of all, and at every step, make sure of the meaning of the words that we use as its terms, so that when we use them they shall always have for us the same meaning.
Words are the signs or tokens by which in speech or writing we communicate our thoughts to one another. To understand one another with precision, it is necessary that each attach precisely the same meaning to the same word. Thus, two men may look on the ocean from the same place, and one honestly insist that there are three ships in sight, while the other as honestly insist that there only two, if the one uses the word "ship" in its general meaning of navigable vessel, and the other uses it in its technical meaning of a vessel carrying three square-rigged masts. Such use of words and somewhat different senses is peculiarly dangerous in philosophic discussion.
But words are more than the means by which we communicate our thoughts. They are also signs or tokens in which we ourselves think — the labels of the thought-drawers or pigeonholes in which we stow away the various ideas that we often mentally deal with by label. Thus, we cannot think with precision unless in our own minds we use words with precision. This is especially important in political economy, for in other studies most of the words used as terms are peculiar to that study. The terms used in chemistry, for instance, are used only in chemistry. But the terms used in political economy are not words reserved to it. They are words in everyday use, which the necessities of daily life constantly require us to give to, and accept for, a different than the economic meaning. In studying political economy, in thinking out any of its problems, it is absolutely necessary to give to such terms as wealth, value, capital, land, labor, rent, interest, wages, money, and so on, a precise meaning; and to use them only in this — a meaning which always differs, and in some cases differs widely, from the common meaning. But not only have we all been accustomed in the first place to use these words in their common meanings; but even after we have given them as politico-economic terms a definite meaning, we must, in ordinary talk and reading continue to use and accept them in their ordinary sense.
Hence arises in political economy a liability to confusion in thought from lack of definiteness in the use of terms. The most eminent writers on political economy have given examples of this, confusing themselves as well as their readers. To guard against this danger it is necessary to be careful in beginning, and continuously to be careful. I shall therefore in this work try to define each term as it arises, and thereafter, when using it as an economic term, try to use it in that precise sense, and no other.
To define a word is to mark off what it includes from what it does not include — to make it in our minds, as it were, clear and sharp on its edges — so that it will always stand for the same thing or things, not at one time more and at another time less.
Thus, beginning at the beginnings, let us consider the nature and scope of political economy, that we may see its origin and meaning, what it includes and what it does not include. If in this I ask the reader to go with me deeper than writers on political economy usually do, let him not think me wandering from the subject. He who would build a towering structure of brick and stone, that in stress and strain will stand firm and plumb, digs for its foundation to solid rock.