To enforce this truth he goes on to say:—“Let any one propose to himself the problem of supplying with daily provisions of all kinds such a city as our metropolis, containing above a million of inhabitants.” And then he points out the many immense difficulties of the task {424} caused by inconstancy in the arrival of supplies; by the perishable nature of many of the commodities; by the fluctuating number of consumers; by the heterogeneity of their demands; by variations in the stocks, immediate and remote, and the need for adjusting the rate of consumption; and by the complexity in the process of distribution required to bring due quantities of these many commodities to the homes of all citizens. And, having dwelt on these many difficulties, he finishes his picture by saying:—
“Yet this object is accomplished far better than it could be by any effort of human wisdom, through the agency of men who think each of nothing beyond his own immediate interest—who, with that object in view, perform their respective parts with cheerful zeal—and combine unconsciously to employ the wisest means for effecting an object, the vastness of which it would bewilder them even to contemplate.”
But though the far-spreading and complex organization by which foods of all kinds are produced, prepared, and distributed throughout the entire kingdom, is a natural growth and not a State-manufacture; though the State does not determine where and in what quantities cereals and cattle and sheep shall be reared; though it does not arrange their respective prices so as to make supplies last until fresh supplies can come; though it has done nothing toward causing that great improvement of quality which has taken place in food since early times; though it has not the credit of that elaborate apparatus by which bread, and meat, and milk, come round to our doors with a daily pulse that is as regular as the pulse of the heart; yet the State has not been wholly passive. It has from time to time done a great deal of mischief. When Edward I. forbade all towns to harbour forestallers, and when Edward VI. made it penal to buy grain for the purpose of selling it again, they were preventing the process by which consumption is adjusted to supply: they were doing all that could be done to insure alternations of abundance and starvation. Similarly with the many legislative attempts {425} since made to regulate one branch or other of the food-industry, down to the corn-law sliding-scale of odious memory. For the marvellous efficiency of this organization we are indebted to private enterprise; while the derangements of it we owe to the positively-regulative action of the Government. Meanwhile, its negatively-regulative action, required to keep this organization in order, Government has not duly performed. A quick and costless remedy for breach of contract, when a trader sells, as the commodity asked for, what proves to be wholly or in part some other commodity, is still wanting.
Our second case shall be the organization which so immensely facilitates commerce by transfers of claims and credits. Banks were not inventions of rulers or their counsellors. They grew up by small stages out of the transactions of traders with one another. Men who for security deposited money with goldsmiths, and took receipts; goldsmiths who began to lend out at interest the moneys left with them, and then to offer interest at lower rates to those who would deposit money; were the founders of them. And when, as presently happened, the receipt-notes became transferable by indorsement, banking commenced. From that stage upward the development, notwithstanding many hinderances, has gone on naturally. Banks have sprung up under the same stimulus which has produced all other kinds of trading bodies. The multiplied forms of credit have been gradually differentiated from the original form; and while the banking system has spread and become complex, it has also become consolidated into a whole by a spontaneous process. The clearing-house, which is a place for carrying on the banking between bankers, arose unobtrusively out of an effort to economize time and money. And when, in 1862, Sir John Lubbock—not in his legislative capacity but in his capacity as banker—succeeded in extending the privileges of the clearing-house to country banks, the unification was made {426} perfect; so that now the transactions of any trader in the kingdom with any other may be completed by the writing off and balancing of claims in bankers’ books. This natural evolution, be it observed, has reached with us a higher phase than has been reached where the positively-regulative control of the State is more decided. They have no clearing-house in France; and in France the method of making payments by checks, so dominant among ourselves, is very little employed and in an imperfect way. I do not mean to imply that in England the State has been a mere spectator of this development. Unfortunately, it has from the beginning had relations with banks and bankers: not much, however, to their advantage, or that of the public. The first kind of deposit-bank was in some sense a State-bank: merchants left funds for security at the Mint in the Tower. But when Charles I. appropriated their property without consent, and gave it back to them only under pressure, after a long delay, he destroyed their confidence. Similarly, when Charles II., in furtherance of State-business, came to have habitual transactions with the richer of the private bankers; and when, having got nearly a million and a half of their money in the Exchequer, he stole it, ruined a multitude of merchants, distressed ten thousand depositors, and made some lunatics and suicides, he gave a considerable shock to the banking system as it then existed. Though the results of State-relations with banks in later times have not been so disastrous in this direct way, yet they have been indirectly disastrous—perhaps even in a greater degree. In return for a loan, the State gave the Bank of England special privileges; and for the increase and continuance of this loan the bribe was the maintenance of these privileges—privileges which immensely hindered the development of banks. The State did worse. It led the Bank of England to the verge of bankruptcy by a forced issue of notes, and then authorized it to break its promises {427} to pay. Nay, worse still, it prevented the Bank of England from fulfilling its promises to pay when it wished to fulfil them. The evils that have arisen from the positively-regulative action of the State on banks are too multitudinous to be here enumerated. They may be found in the writings of Tooke, Newmarch, Fullarton, Macleod, Wilson, J. S. Mill, and others. All we have here to note is, that while the enterprise of citizens in the pursuit of private ends has developed this great trading-process, which so immensely facilitates all other trading-processes, Governments have over and over again disturbed it to an almost fatal extent; and that, while they have done enormous mischief of one kind by their positively-regulative action, they have done enormous mischief of another kind by failing in their negatively-regulative action. They have not done the one thing they had to do: they have not uniformly insisted on fulfilment of contract between the banker and the customer who takes his promise to pay on demand.
Between these two cases of the trade in food and the trade in money, might be put the cases of other trades: all of them carried on by organizations similarly evolved, and similarly more or less deranged from time to time by State-meddling. Passing over these, however, let us turn from the positive method of elucidation to the comparative method. When it is questioned whether the spontaneous coöperation of men in pursuit of personal benefits will adequately work out the general good, we may get guidance for judgment by comparing the results achieved in countries where spontaneous coöperation has been most active and least regulated, with the results achieved in countries where spontaneous coöperation has been less trusted and State-action more trusted. Two cases, furnished by the two leading nations on the Continent, will suffice.
In France, the École des Ponts et Chaussées was founded in 1747 for educating civil engineers; and in 1795 was {428} founded the École Polytechnique, serving, among other purposes, to give a general scientific training to those who were afterward to be more specially trained for civil engineering. Averaging the two dates, we may say that for a century France has had a State-established and State-maintained appliance for producing skilled men of this class—a double gland, we may call it, to secrete engineering faculty for public use. In England, until quite recently, we have had no institution for preparing civil engineers. Not by intention, but unconsciously, we left the furnishing of engineering faculty to take place under the law of supply and demand—a law which at present seems to be no more recognized as applying to education, than it was recognized as applying to commerce in the days of bounties and restrictions. This, however, by the way. We have here simply to note that Brindley, Smeaton, Rennie, Telford, and the rest, down to George Stephenson, acquired their knowledge, and got their experience, without State-aid or supervision. What have been the comparative results in the two nations? Space does not allow a detailed comparison: the later results must suffice. Railways originated in England, not in France. Railways spread through England faster than through France. Many railways in France were laid out and officered by English engineers. The earlier French railways were made by English contractors; and English locomotives served the French makers as models. The first French work written on locomotive engines, published about 1840 (at least I had a copy at that date), was by the Comte de Pambour, who had studied in England, and who gave in his work nothing whatever but drawings and descriptions of the engines of English makers.
The second illustration is supplied to us by the model nation, now so commonly held up to us for imitation. Let us contrast London and Berlin in respect of an all-essential appliance for the comfort and health of citizens. When, {429} at the beginning of the seventeenth century, the springs and local conduits, supplemented by water-carriers, failed to supply the Londoners; and when the water-famine, for a long time borne, had failed to make the Corporation do more than propose schemes, and had not spurred the central government to do any thing; Hugh Myddleton, a merchant citizen, took in hand himself the work of bringing the New River to Islington. When he had half completed the work, the king came to his help—not, indeed, in his capacity of ruler, but in the capacity of speculator, investing his money with a view to profit: his share being disposed of by his successor after the formation of the New River Company, which finished the distributing system. Subsequently, the formation of other water-companies, utilizing other sources, has given London a water-supply that has grown with its growth. What, meanwhile, happened at Berlin? Did there in 1613, when Hugh Myddleton completed his work, grow up there a like efficient system? Not at all. The seventeenth century passed, the eighteenth century passed, the middle of the nineteenth century was reached, and still Berlin had no water-supply like that of London. What happened then? Did the paternal government at length do what had been so long left undone? No. Did the citizens at length unite to secure the desideratum? No. It was finally achieved by the citizens of another nation, more accustomed to coöperate in gaining their own profits by ministering to public needs. In 1845 an English company was formed for giving Berlin an adequate water-supply; and the work was executed by English contractors—Messrs. Fox and Crampton.
Should it be said that great works of ancient nations, in the shape of aqueducts, roads, etc., might be instanced in proof that State agency secures such ends, or should it be said that a comparison between the early growth of inland navigation on the Continent, and its later growth here, {430} would be to our disadvantage, I reply that, little as they at first seem so, these facts are congruous with the general doctrine. While the militant social type is dominant, and the industrial organization but little developed, there is but one coördinating agency for regulating both sets of activities; just as we saw happens with the lower types of individual organisms. It is only when a considerable advance has been made in that metamorphosis which develops the industrial structures at the expense of the militant structures, and which brings along with it a substantially-independent coördinating agency for the industrial structures—it is only then that the efficiency of these spontaneous coöperations for all purposes of internal social life becomes greater than the efficiency of the central governing agency.
Possibly it will be said that though, for subserving material needs, the actions of individuals, stimulated by necessity and made quick by competition, are demonstrably adequate, they are not adequate for subserving other needs. I do not see, however, that the facts justify this position. We have but to glance around to find in abundance similarly-generated appliances for satisfying our higher desires, as well as our lower desires. The fact that the Fine Arts have not thriven here as much as in some Continental countries, is ascribable to natural character, to absorption of our energies in other activities, and to the repressive influence of chronic asceticism, rather than to the absence of fostering agencies: these the interests of individuals have provided in abundance. Literature, in which we are second to none, owes, with us, nothing to State-aid. The poetry which will live is poetry which has been written without official prompting; and though we have habitually had a prize-poet, paid to write loyal verses, it may be said, without disparaging the present one, that a glance over the entire list does not show any benefit derived by poetry from State-patronage. Nor are other {431} forms of literature any more indebted to State-patronage. It was because there was a public liking for fiction that fiction began to be produced; and the continued public liking causes a continued production, including, along with much that is worthless, much that could not have been made better by any academic or other supervision. And the like holds of biographies, histories, scientific books, etc. Or, as a still more striking case of an agency that has grown up to meet a non-material want, take the newspaper press. What has been the genesis of this marvellous appliance, which each day gives us an abstract of the world’s life the day before? Under what promptings have there been got together its staffs of editors, sub-editors, article-writers, reviewers; its reporters of parliamentary debates, of public meetings, of law cases and police cases; its critics of music, theatricals, paintings, etc.; its correspondents in all parts of the world? Who devised and brought to perfection this system which at six o’clock in the morning gives the people of Edinburgh a report of the debates that ended at two or three o’clock in the House of Commons, and at the same time tells them of events that occurred the day before in America? It is not a Government invention. It is not a Government suggestion. It has not been in anyway improved or developed by legislation. On the contrary, it has grown up in spite of many hinderances from the Government and burdens which the Government has imposed on it. For a long time the reporting of parliamentary debates was resisted; for generations censorships and prosecutions kept newspapers down, and for several subsequent generations the laws in force negatived a cheap press, and the educational benefits accompanying it. From the war-correspondent, whose letters give to the very nations that are fighting their only trustworthy accounts of what is being done, down to the newsboy who brings round the third edition with the latest telegrams, the whole organization is a product of spontaneous {432} coöperation among private individuals, aiming to benefit themselves by ministering to the intellectual needs of their fellows—aiming also, not a few of them, to benefit their fellows by giving them clearer ideas and a higher standard of right. Nay, more than this is true. While the press is not indebted to the Government, the Government is enormously indebted to the press; without which, indeed, it would stumble daily in the performance of its functions. This agency which the State once did its best to put down, and has all along impeded, now gives to the ministers news in anticipation of their dispatches, gives to members of Parliament a guiding knowledge of public opinion, enables them to speak from the House of Commons benches to their constituents, and gives to both legislative chambers a full record of their proceedings.
I do not see, therefore, how there can be any doubt respecting the sufficiency of agencies thus originating. The truth that in this condition of mutual dependence brought about by social life, there inevitably grow up arrangements such that each secures his own ends by ministering to the ends of others, seems to have been for a long time one of those open secrets which remain secret because they are so open; and even now the conspicuousness of this truth seems to cause an imperfect consciousness of its full meaning. The evidence shows, however, that even were there no other form of spontaneous coöperation among men than that dictated by self-interest, it might be rationally held that this, under the negatively-regulative control of a central power, would work out, in proper order, the appliances for satisfying all needs, and carrying on healthfully all the essential social functions.