Civilization in the United States: An inquiry by thirty Americans

by Unknown

ECONOMIC OPINION

The literature of economic opinion in America is almost as voluminous as the printed word. It ranges from the ponderous treatises of professed economists, wherein “economic laws” are printed in italics, to the sophisticated novels of the self-elect, in which economic opinion is a by-product of clever conversation. Not only can one find economic opinion to his taste, but he can have it in any form he likes. Perhaps the most human and reasonable application of the philosophy of laissez-faire to the problems of industrial society is to be found in the pages of W. G. Sumner. Of particular interest are the essays contained in the volumes entitled “Earth Hunger,” “The Challenge of Facts,” and “The Forgotten Man.” The most subtle and articulate account of the economic order as an automatic, self-regulating mechanism is J. B. Clark, “The Distribution of Wealth.” An able and readable treatise, characterized alike by a modified classical approach and by a recognition of the facts of modern industrial society, is F. W. Taussig, “The Principles of Economics.” The “case for capitalism” has never been set forth as an articulate whole. The theoretical framework of the defence is to be found in any of the older treatises upon economic theory. A formal apologia is to be found in the last chapter of almost every text upon economics under some such title as “A Critique of the Existing Order,” “Wealth and Welfare,” or “Economic Progress.” A defence of “what is,” whatever it may chance to be, characterized alike by brilliancy and ignorance, is P. E. More’s “Aristocracy and Justice.” Contemporary opinion favourable to capitalism may be found, in any requisite quantity and detail, in The Wall Street Journal, The Commercial and Financial Chronicle, and the publications of the National Association of Manufacturers. The Congressional Record, a veritable treasure house of economic fallacy, presents fervent pleas both for an unqualified capitalism and for capitalism with endless modifications. The literature of the economics of “control” is beginning to be large. The essay by H. C. Adams, “The Relation of the State to Industrial Activity,” elaborating the thesis that the function of the state is to regulate “the plane of competition,” has become a classic. The best account of the economic opinion of organized labour is to be found in R. F. Hoxie, “Trade Unionism in the United States.” Typical examples of excellent work done by men who do not profess to be economists are W. Lippmann, “Drift and Mastery,” the opinions (often dissenting) delivered by Mr. Justice Holmes and Mr. Justice Brandeis, of the United States Supreme Court, and the articles frequently contributed to periodicals by T. R. Powell upon the constitutional aspects of economic questions. The appearance of such studies as the brief for the shorter working day in the case of Bunting v. Oregon, prepared by F. Frankfurter and J. Goldmark, and of the “Report on the Steel Strike of 1919,” by the Commission of Inquiry of the Interchurch World Movement indicates that we are beginning to base our opinions and our policies upon “the facts.” Among significant contributions are the articles appearing regularly in such periodicals as The New Republic and The Nation. At last the newer economics of the schools is beginning to assume the form of an articulate body of doctrine. The books of T. B. Veblen, particularly “The Theory of Business Enterprise,” and “The Instinct of Workmanship,” contain valuable pioneer studies. In “Personal Competition” and in the chapters upon “Valuation” in “Social Process,” C. H. Cooley has shown how economic institutions are to be treated. The newer economics, however, begins with the publication in 1913 of W. C. Mitchell, “Business Cycles.” This substitutes an economics of process for one of statics and successfully merges theoretical and statistical inquiry. It marks the beginning of a new era in the study of economics. The work in general economic theory has followed the leads blazed by Veblen, Cooley, and Mitchell. W. H. Hamilton, in “Current Economic Problems,” elaborates a theory of the control of industrial development, interspersed with readings from many authors. L. C. Marshal, in “Readings in Industrial Society,” attempts, through selections drawn from many sources, an appraisal of the institutions which together make up the economic order. D. Friday, in “Profits, Wages, and Prices,” shows how much meaning a few handfuls of figures contain and how much violence they can do to established principles. The National Bureau of Economic Research is soon to publish the results of a careful and thorough statistical inquiry into the division of income in the United States. Upon particular subjects such as trusts, tariffs, railroads, labour unions, etc., the literature is far too large to be catalogued here. There is no satisfactory history of economic opinion in the United States. T. B. Veblen’s “The Place of Science in Modern Civilization” contains a series of essays which constitute the most convincing attack upon the classical system and which point the way to an institutional economics. Many articles dealing with the development of economic doctrines are to be found in the files of The Quarterly Journal of Economics and of The Journal of Political Economy. An excellent statement of the present situation in economics is an unpublished essay by W. C. Mitchell, “The Promise of Economic Science.”

W. H. H.