Trade is not a mere business custom, as is sometimes carelessly supposed. Only to the extent that they conform to natural Economic law can trading customs be socially beneficial or continue without developing social disaster.
Many customs do enter into Trade, even as habits enter into the life of individuals—some beneficial and some vicious, some in harmony with natural law and some defiant or evasive of it. But essentially Trade is a natural expression of Economic relationships. It is consequently as dependent upon conformity to natural laws as are the physical functions of individuals. Drawing inspiration continuously from natural human impulses, giving constant and increasing satisfaction to natural human needs, bringing natural human units ever closer into a natural social whole, contributing one of the two indispensable and fundamentally effective as well as obvious natural powers and facilities for the continuous and increasing production of human satisfactions, Trade is evidently as natural to the social whole as is breathing or eating to the individual. It must therefore be as completely subject to natural law.
By nature man is “a trading animal.” So it has often been said, and the saying is manifestly true. There is, however, no implication here that man is an animal only. The suggestion is that, although an animal, he is more than an animal, and that Trade develops phenomena which go to prove it.
Of all animals, man only is within the jurisdiction of the natural Economic laws of Trade. What other animal than man could be correctly described, in a comprehensive sense, as “a trading animal”? Not only is this characteristic distinctive. Not only is it peculiarly human. But also, and by force of natural Economic law—not commercial custom, but those natural sequences of effect from cause to which arbitrary commercial customs must yield or come to grief,—it enables mankind, the larger man, the social man, to multiply the Economic powers of each individual of the human race.
Primary among those natural laws of Trade is the thoroughly tested sequence alluded to above, that Trade multiplies productive power. It does so by inviting, requiring and developing that characteristic phenomenon of Trade which is commonly called “division of labor,” but may be distinguished best as Economic specialization.[2] This phenomenon gives to the world, gives to it as a natural effect of Trade, a productive power per capita far and away beyond the productive power of any isolated individual.
[2] The principle of Economic specialization could hardly be better illustrated than by the reply of an old-time compositor in a printing establishment who contemplated making a contract for the erection of a cottage home for himself and his family, when a friend suggested that he might save money by digging the cellar himself between working hours at the case. He replied: “I can dig a better cellar and more easily at the case with a composing-stick than on the spot with a pick and shovel.”
By means of a vast variety of Economic specialties—such for illustration as farming, engineering, mining, lumbering and their respective and numerous subdivisions, through a vast variety of other Economic specialties, such as transporting and manufacturing and merchandizing, along with their respective and multitudinous subdivisions, all supplemented by such other Economic specialties as banking, teaching, preaching, adjudicating, writing, acting, and the fine arts—the necessaries for individual sustenance and the luxuries for individual enjoyment are produced and delivered in quantity, variety and perfection which, when calculated per capita, rise far above and extend far beyond all the possibilities of isolated individual life, far above and beyond the possibilities of community life in narrow environments.
Were there but one individual to be considered, the natural advantages of Trade would seem as fanciful as a fairy story. Were there only a small group, the natural advantages of Trade, though manifest, would be too few and too primitive to disclose its wondrous powers of production. But when millions of individuals cooperate, some serving all and all serving each through the intricacies of worldwide Trade, mankind is welded into an Economic unity, a gigantic oneness—a larger human being, “the social man” as this social organism is sometimes not inaptly called—an organism composed of individuals who give it vitality and whom in consequence it serves as a beneficent giant might serve a cooperating pigmy.
Involving the production of commodities by individual contributors of human service through an infinity of specializations, and their assignment to individuals by the intricate processes of service for service, Trade tends not only to increase the per capita supply of commodities, but also to effect their fair per capita assignment in proportions corresponding to the relative desirability of the numerous and various contributions of individual service to their production.
In describing Trade as consisting essentially of interchanges of human services, we are of course to be understood as including not only such services as are embodied in tangible commodities, but also personal service. Nor does it make any Economic difference whether the personal service be of the “servant” type or of the “professional” type.