Ethics · John Dewey
THE ETHICS OF THE ECONOMIC LIFE
In considering the ethics of the economic life and of property, so far as this latter topic has not received treatment elsewhere, we give (1) a general analysis of the ethical questions involved, (2) a more specific account of the problems raised by the present tendencies of industry, business, and property; we follow these analyses with (3) a statement of principles, and (4) a discussion of unsettled problems. Sec. 1. GENERAL ANALYSIS Both the economic process and property have three distinct ethical aspects corresponding respectively to the ethical standpoint of happiness, character, and social justice. (1) The economic process supplies men with goods for their bodily wants and with many of the necessary means for satisfying intellectual, aesthetic, and social needs; property represents permanence and security in these same values. (2) Through the difficulties it presents, the work it involves, and the incitements it offers, the economic process has a powerful influence in evoking skill, foresight, and scientific control of nature, in forming character, and stimulating ambition to excel. Property means power, control, and the conditions for larger freedom. (3) The economic process has an important social function. Through division of labor, cooperation, and exchange of goods and services, it affords one of the fundamental expressions of the organic nature of society in which members are reciprocally ends to each other. Property, likewise, is not only a possessing, but a "right," and thus, like all rights, involves the questions why and how far society should support the individual in his interests and claims. Let us examine each of these aspects further.
If wealth is a good, it might seem that property must be judged by the same standard, since it represents security in the satisfactions which wealth affords. But there is an important distinction. Wealth means enjoyment of goods and satisfaction of wants. Property means the title to the exclusive use or possession of goods. Hence the increase of property may involve increasing exclusion of part of the community from wealth, although the owners of the property may be increasing their own enjoyments. For, as pointed out very forcibly by Hadley in the first chapter of his _Economics_, the public wealth of a community is by no means equal to the sum of its private property. If all parks were divided up into private estates, all schoolhouses controlled by private owners, all water supplies and highways given into private control, the sum of private property might be very much increased; but the public wealth would be decreased. Property is one of the means of dealing with public wealth. It is important to bear in mind, however, that it is only one means. Wealth may be (1) privately owned and privately used; (2) privately owned and publicly or commonly used; (3) publicly owned, but privately used; (4) publicly owned and publicly or commonly used.
Illustrations of these four methods are, for the first, among practically all peoples, clothing and tools; of the second, a private estate opened to public use--as a park; of the third, public lands or franchises leased to individuals; of the fourth, public highways, parks, navigable rivers, public libraries. Whether property in any given case is a means to happiness will depend, then, largely upon whether it operates chiefly to increase wealth or to diminish it. The view has not been infrequent that the wealth of the community is the sum of its private property. From this it is but a step to believe "that the acquisition of property is the production of wealth, and that he best serves the common good who, other things equal, diverts the larger share of the aggregate wealth to his own possession."[223] The ethical questions as to the relation of property to happiness involve accordingly the problem of justice and can be more conveniently considered under that head. =2. Relation to Character.=--Even in its aspect of satisfying human wants, quantity of production is not the only consideration. As was pointed out in the chapters on Happiness, the satisfaction of any and every want is not necessarily a moral good. It depends upon the nature of the wants; and as the nature of the wants reflects the nature of the man who wants, the moral value of the economic process and of the wealth it provides must depend upon the relation of goods to persons. As economists we estimate values in terms of external goods or commodities; as ethical students we estimate values in terms of a certain quality of life. We must ask first how the satisfaction of wants affects the consumers.
Moreover, the relation of production to physical welfare is only one aspect of its effects upon life and character. We may properly ask of any process or system whether it quickens intelligence or deadens it, whether it necessitates the degradation of work to drudgery, and whether it promotes freedom or hampers it. To answer this last question we shall have to distinguish formal from real freedom. It might be that a system favorable to the utmost formal freedom--freedom of contract--would result in the most entire absence of that real freedom which implies real alternatives. If the only alternative is, this or starve, the real freedom is limited. =Property and Character.=--Viewed on its positive side, property means an expansion of power and freedom. To seize, master, and possess is an instinct inbred by the biological process. It is necessary for life; it is a form of the _Wille zum Leben_ or _Wille zur Macht_ which need not be despised. But in organized society possession is no longer mere animal instinct; through expression in a social medium and by a social person it becomes a _right_ of property. This is a far higher capacity; like all rights it involves the assertion of personality and of a rational claim upon fellow members of society for their recognition and backing. Fichte's doctrine, that property is essential to the effective exercise of freedom, is a strong statement of its moral importance to the individual.
Over against these positive values of property are certain evils which moralists have always recognized, evils both to the property owner and to society. Avarice, covetousness, hardness toward others, seem to be the natural effects of the enormous possibilities of power offered by property, joined with its exclusive character. The prophets of Israel denounced the rich, and Jesus's image of the difficulty found by the rich man in entering the kingdom of God--a moral society--has met general acceptance. Plato's portrayal of the State in which the wealthy rule sketches the perversion and disobedience of laws, the jealousies and class hatred, the evasion of taxes for public defense, and gives the moral outcome:-- "And henceforth they press forward on the path of money-getting, losing their esteem for virtue as the esteem for wealth grows upon them. For can you deny that there is such a gulf between wealth and virtue, that when weighed as it were in the two scales of a balance one of the two always falls, as the other rises?"[224] Even apart from questions of just distribution, the moral question arises as to whether an unlimited power should be given to individuals in this form, and whether there should be unlimited right of inheritance. But all these tend to pass over at once into questions of justice. =3. Social Aspects.=--The various relations of man to man, political, friendly, kindred, are developed forms of the interdependence implicit in the early group life. A group of units, each independent of the others, would represent mass only, but such a group as is made up of men, women, and children, sustaining all the relations found in present human life, represents something vastly more than a mass of individuals. Every life draws from the rest. Man without friendship, love, pity, sympathy, communication, cooperation, justice, rights, or duties, would be deprived of nearly all that gives life its value.
The necessary help from others is obtained in various ways. Parental, filial, and other kinship ties, friendship and pity, give rise to certain services, but they are necessarily limited in their sphere and exact in return a special attitude that would be intolerable if made universal. The modern man does not want to be cousin to every one, to give every one his personal friendship, to be in a perpetual attitude of receiving favors, or of asking and not receiving. Formerly the way of getting service from men outside these means was by slavery. The economic relation provides for the mutual exchange of goods and services on a basis of self-respect and equality. Through its system of contracts it provides for future as well as present service. It enables each to obtain the services of all the rest, and in turn to contribute without incurring any other claims or relations. Nor does it at all diminish the moral value of these mutual exchanges of goods and services that they may be paid for. It used to be the theory that in every bargain one party gained and the other lost. It is now recognized that a normal transaction benefits both parties. The "cash payment basis," which was at first denounced as substituting a mechanical nexus for the old personal tie, is in reality a means for establishing a greater independence instead of the older personal relation of "master" and "servant." It enabled a man, as Toynbee puts it, to sell his labor like any other commodity without selling himself.
But while the economic process has these moral possibilities, the morality of any given system or practice will depend on how far these are actually realized. First of all, we may fairly ask of a process, Does it give to each member the kind of service needed by him? In economic terms, Does it produce the kinds of goods which society needs and desires? A method which provides for this successfully will in so far be providing against scarcity of some goods and oversupply of others, and thus against one of the sources of crises, irregularity of work and wages, and ultimately against suffering and want. Secondly, if the process is an expression of the mutual dependence and service of members who as persons all have, as Kant puts it, intrinsic worth, and who in our political society are recognized as equal, we may fairly ask how it distributes the results of services rendered. Does the process tend to a broad and general distribution of goods in return for services rendered, or to make "the rich richer and the poor poorer?" Or, from another point of view, we might ask, Does the process tend to reward members on a moral or equitable basis, or upon a basis which is non-moral if not immoral or unjust.
Thirdly, the problem of _conflicting services_ presents itself under several forms. There is, first, the ever-present conflict between producer and consumer. Higher wages and shorter hours are good for the carpenter or the weaver, until he pays his rent or buys clothes, when he is interested in cheaper goods. What principle can be employed to adjust such a question? Again, service to the consumer may lead a producer to a price-list implying a minimum of profits. One producer can afford this because of his larger business, but it will drive his competitor from the field. Shall he agree to a higher price at which all can do business, or insist on the lower which benefits the consumer and also himself? The labor union is a constant embodiment of the problem of conflicting services. How far shall it serve a limited group, the union, at the expense of other workers in the same trade--non-unionists? Does it make a difference whether the union is open to all, or whether the dues are fixed so high as to limit the membership? Shall the apprentices be limited to keep up the wage by limiting the supply? If so, is this fair to the boys or unskilled laborers who would like to enter? And granting that it is a hardship to these, is it harder or is it kinder to them than it would be to leave the issue to the natural weeding out or starving-out procedure of natural selection in case too many enter the trade? Shall the hours be reduced and wages raised as high as possible, or is there a "fair" standard--fair to both consumer and laborer? How far may the union combine with the capitalist to raise prices to the consumer?
Granting, however, the general position that some parts of wealth should be privately owned, we must recognize that a great number of moral problems remain as to the precise conditions under which society will find it wise to entrust the control of wealth to private ownership. For it must be clearly kept in mind that there is no absolute right of private property. Every right, legal or moral, derives from the social whole, which in turn, if it is a moral whole, must respect the individuality of each of its members. On this basis moral problems, such as the following, must be considered. What kind of public wealth should be given into absolute control of private individuals or impersonal corporations? Does the institution in its present form promote the good of those who have no property as well as of those who have it, or only of those who own? Would the welfare of society as a whole be promoted by giving a larger portion of public wealth into private control, or by retaining a larger proportion than at present under public ownership? Should there be any limit to the amount of land or other property which an individual or corporation may own? Are there any cases in which private ownership operates rather to exclude the mass of society from the benefits of civilization than to give them a share of those benefits? Should a man be allowed to transmit all his property to his heirs, or should it be in part reserved by society?
The preceding analysis has aimed to state some of the problems which belong necessarily to the economic life. At the present time, however, the moral issues assume a new and puzzling aspect because of the changes in economic conditions. It will be necessary to consider briefly these changed conditions. Sec. 2. THE PROBLEMS SET BY THE NEW ECONOMIC ORDER =The Collective and Impersonal Organizations.=--Two changes have come over a large part of the economic and industrial field. The first is the change from an individual to a collective basis. The second, which is in part a consequence of the first, is a change from personal to impersonal or corporate relations. Corporations are of course composed of persons, but when organized for economic purposes they tend to become simply economic purpose incorporate, abstracted from all other human qualities. Although legally they may be subjects of rights and duties, they have but one motive, and are thus so abstract as to be morally impersonal. They tend to become machines for carrying on business, and, as such, may be as powerful--and as incapable of moral considerations--as other machines.
The changes in the economic and industrial processes by which not only the associated powers of present human knowledge, skill, and endurance, but also the combined results of past and future skill and industry are massed and wielded, depend on several concurrent factors. We shall notice the social agency, the technique of industry, the technique of business, the means of fixing value, and the nature of property. Sec. 3. THE AGENCIES FOR CARRYING ON COMMERCE AND INDUSTRY =Early Agencies.=--The early agencies for carrying on trade and industry were not organized purely for economic purposes. The kindred or family group engaged in certain industries, but this was only part of its purpose. So in the various territorial groups. The Athenian city-state owned the mines; the German village had its forest, meadow, and water as a common possession; and the "common" survived long in English and American custom, though the cattle pastured on it might be individually owned. In the United States certain land was reserved for school purposes, and if retained would now in some cases be yielding an almost incredible amount for public use; but it has usually been sold to private individuals. The national government still retains certain land for forest reserve, but until the recent movement toward municipal ownership, the civic community had almost ceased to be an economic factor in England and America, except in the field of roads, canals, and the postoffice. In both family and territorial or community control of industry, we have the economic function exercised as only one among several others. The economic helped to strengthen the other bonds of unity. On the other hand, the economic motive could not disentangle itself and stand out in all its naked force. Within either family or civic group the effects of the acquisitive instincts were limited by the fact that individuals in their industrial relations were also kin or neighbors.
The man may later correspond with some higher official, and if patience and life both persist long enough, he will probably recover. But to prevent fraud, the company is obliged to be more rigorous than a person would be who was dealing with the case in a personal fashion. Hence the individual with a just grievance is likely to entertain toward the corporation the feeling that he is dealing with a machine, not with an ethical being, even as the company's servants are not permitted to exercise any moral consideration in dealing with the public. They merely obey orders. Public sentiment, which would hold an individual teamster responsible for running over a child, or an individual stage owner responsible for reckless or careless conduct in carrying his passengers, feels only a blind rage in the case of a railroad accident. It cannot fix moral responsibility definitely upon either stockholder or management or employee, and conversely neither stockholder, nor manager, nor employee[227] feels the moral restraint which the individual would feel. He is not wholly responsible, and his share in the collective responsibility is so small as often to seem entirely negligible.
As the corporation may employ scores of thousands, and be practically the only employer of a particular kind of labor, it can thus enforce a virtual boycott and prevent the union from selling its labor. It does not need to use a "blacklist" because the employers are all combined in one "person." On the other hand, the union is adjudged to act in restraint of interstate commerce if it boycotts the employing corporation. The union is here treated as a combination, not as a single person. The second point in which the employing body has greatly the legal advantage appears in the case of a strike. Men are allowed to quit work, but this is not an effective method of exerting pressure unless the employer is anxious to keep his plant in operation and can employ no one else. If he can take advantage of an open labor market and hire other workmen, the only resource of the strikers is to induce these to join their ranks. But they have been enjoined by the courts, not only from intimidating, but even from persuading[228] employees to quit work.
The method of procedure in enforcing the injunction, which enables the judge to fix the offense, eliminate trial by jury, determine the guilt, and impose any penalty he deems fit, has all the results of criminal process with none of its limitations, and forms a most effective agency against the unions. Where persuasion is enjoined it is difficult to see how a union can exert any effective pressure except in a highly skilled trade, where it can control all the labor supply. In the field of private rights and free contract, the labor unions are then at a disadvantage because they have no rights which are of any value for their purposes, except, under certain conditions, the right to refuse to work. And since this is, in most cases, a weapon that injures its wielder far more than his opponent, it is not effective.
Disappointed in the field of free contract, the labor unions seek to enlist public agency in behalf of better sanitary conditions and in prevention of child-labor, long hours for women, unfair contracts, and the like. Capitalistic corporations frequently resist this change of venue on the ground that it interferes with free contract or takes away property without "due process of law," and many laws have been set aside as unconstitutional on these grounds,[229] several of them no doubt because so drawn as to appear to be in the interest of a class, rather than in that of the public. The trend in the direction of asserting larger public control both under the police power and over corporations in whose service the public has a direct interest, will be noted later. Against other corporations the general public or the unsuccessful competitor has sought legal aid in legislation against "trusts," but this has mainly proved to be futile. It has merely induced a change in form of organization. Nor has it been easy as yet for the law to exercise any effective control over the business corporation on any of the three principles invoked--namely: to prevent monopoly, to secure the public interest in the case of public service corporations, and to assert police power. For penalties by fine frequently fail to reach the guilty persons, and it is difficult to fix any personal responsibility. Juries are unwilling to convict subordinate officials of acts which they believe to have been required by the policy of the higher officials, while, on the other hand, the higher officials are seldom directly cognizant of criminal acts. Gradually, however, we may believe that the law will find a way to make both capital and labor organizations respect the public welfare, and to give them support in their desirable ends. The cooperative principle cannot be outlawed; it must be more fully socialized.
Sec. 4. THE METHODS OF PRODUCTION, EXCHANGE, AND VALUATION =The Machine.=--The technique of production has shown a similar progress from individual to collective method. The earlier method was that of handicraft. The present method in most occupations, aside from agriculture, is that of the machine. But the great economic advantage of the machine is not only in the substitution of mechanical power for muscle; it is also in the substitution of collective for individual work. It is the machine which makes possible on a tremendously effective basis the division of labor and its social organization. The extraordinary increase in wealth during the past century depends upon these two factors. The machine itself moreover, in its enormous expansion, is not only a social tool, but a social product. The invention and discovery which gave rise to the new processes in industry of every sort were largely the outcome of scientific researches carried on at public expense to a great extent by men other than those who finally utilize their results. They become in turn the instruments for the production of wealth, which is thus doubly social in origin.
This machine process has an important bearing upon the factors of character mentioned in our analysis. It standardizes efficiency; it calls for extraordinary increase of speed; it requires great specialization of function and often calls for no knowledge of the whole process. On the other hand, it gives a certain sense of power to control and direct highly complicated machinery. In the more skilled trades there is more time and resource for intellectual, aesthetic, or social satisfactions. The association of workmen favors discussion of common interests, sympathy, and cooperation; this may evoke a readiness to sacrifice individual to group welfare, which is quite analogous to patriotic sentiment at its best, even if it is liable to such violent expressions as characterize patriotic sentiment at its worst. The association of workmen is one of the most significant features of modern industry.
The other factor in valuation, namely, the supply, is likewise being affected in an increasing degree by social forces. With many, if not with most, of the commodities which are of greatest importance, it has been found that there is less profit in an unrestricted supply than in a supply regulated in the interest of the producers. The great coal mines, the iron industries, the manufacturers of clothing, find it more profitable to combine and produce a limited amount. The great corporations and trusts have usually signalized their acquisition of a monopoly or an approximate control of any great field of production by shutting down part of the factories formerly engaged. The supply of labor is likewise limited by the policies of labor unions in limiting the number of apprentices allowed, or by other means of keeping the union small. Tariffs, whether in the interest of capital or of labor, are a social control of the supply. Franchises, whether of steam railroads, street transportation, gas, electric lighting, or other public utilities so-called, are all of them in the nature of monopolies granted to a certain group of individuals. Their value is dependent upon the general need of these utilities, coupled with the public limitation of supply. In many cases the services are so indispensable to the community that the servant does not need to give special care or thought to the rendering of especially efficient service. The increase in population makes the franchises enormously profitable without any corresponding increase of risk or effort on the part of the utility company.
Ideas discussed in this chapter
Text from Project Gutenberg, public domain in the United States.