Ethics · John Dewey
UNSETTLED PROBLEMS IN THE ECONOMIC ORDER (CONTINUED)
It is a mutual cooperation of economic, social, and scientific factors which has brought about a great increase of individual use and enjoyment through public ownership. This _has placed many of the things which make life worth living within the enjoyment of all_, and at the same time given a far better service to the users than the old method of private ownership. _In this change lies, perhaps, the greatest advance of justice_ in the economic sphere, and a great promise for the future. There was a time when if a man would sit down on a piece of ground and enjoy a fine landscape, he must own it. If he would have a plot where his children might play, he must own it. If he would travel, he must carry his own lantern, and furnish his own protection from thieves. If he would have water, he must sink his own well. If he would send a letter, he must own or hire a messenger. If he would read a book, he must not merely own the book, but own or hire the author or copyist. If he would educate his children, he must own or hire the tutor. We have learned that public parks, public lighting and water works, public libraries, and public schools, are better than private provision.
The objection which comes from the individualist to this programme is that it does too much for the individual. It is better, urges individualism, to stimulate the individual's activity and leave his wants largely unsatisfied than to satisfy all his wants at the expense of his activity. But this assumes that what is done through public agencies is done for the people and not by the people. A democracy may do for itself what an aristocracy may not do for a dependent class. The greatest demoralization at the present time is not to those who have not, but to those who appropriate gains due to associated activity, complacently supposing that they have themselves created all that they enjoy. =Another Great Advance is the Change in What Makes Up the Chief Values of Life.=--In early times the values of life were largely found in food, clothing, personal ornaments, bodily comfort, sex gratifications. Enjoyment of these involved exclusive possession and therefore property. But with the advance of civilization an increasing proportion of life's values falls in the mental realm of sharable goods. Satisfaction in knowledge, in art, in association, in freedom, is not diminished, but increased when it is shared. The educated man may have no more property than the illiterate. He has access to a whole system of social values. He has freedom; he has a more genuinely independent type of power than accrues from the mere possession of things. The society of the future will find a part of its justice in so adjusting its economic system that all may enter as fully as possible into this more social world.
On the other hand it may be noted that the individualist of the second sort--who believes in the competitive struggle as a moral process--has no ground on which to declare for "open shop." Exactly the same principle which would permit combination in capital and place no limit on competitive pressure, provided it is all done through free contracts, can raise no objection against combinations of laborers making the best contracts possible. When a syndicate of capitalists has made a highly favorable contract or successfully underwritten a large issue of stock, it is not customary under the principle of "open shop" to give a share in the contract to all who ask for it, or to let the whole public in "on the ground floor." Nor are capitalists accustomed to leave a part of the market to be supplied by some competitor for fear such competitor may suffer if he does not have business. When the capitalist argues for the open shop upon the ground of freedom and democracy, it seems like the case of the mote and the beam.
An analogy with a political problem may aid: Has a nation the right to exclude (or tax heavily) goods or persons from other countries? May it maintain a "closed shop"? The policy of the American colonists and of the United States has varied. The Puritans maintained a "closed shop" on religious lines. They came to this country to maintain a certain religion and polity. They expelled several men who did not agree with them. The United States excludes Chinese laborers, and imposes a tariff which in many cases is intended to be prohibitive against the products of other countries. This is done avowedly to protect the laborer, and in so far as it is effective it closes the shop. The maxim "This is a white man's country" is a similar "closed shop" utterance. On moral grounds the non-union man is in the same category as the man of alien race or country. What, if anything, can justify a nation or smaller group from excluding others from its benefits? Clearly the only conditions are (1) that the group or nation is existing for some morally justifiable end, which (2) would be endangered by the admission of the outsiders. A colony established to work out religious or political liberty would be justified in excluding a multitude who sought to enter it and then subvert these principles. If a union is working for a morally valuable end, e.g., a certain standard of living which is morally desirable, and if this were threatened by the admission of non-union men, the closed shop would seem to be justified. If the purpose were merely to secure certain advantages to a small group, and if the open shop would not lower the standard but merely extend its range of benefits, it is hard to see why the closed shop is not a selfish principle--though no more selfish than the grounds on which the tariff is usually advocated.
So far as the relations between corporation and investor are concerned, the issues are simple. If the stocks are issued with no expectation that they will give any return, merely to "sell," it is pure dishonesty, of the same type which under cruder conditions sold spavined horses or made counterfeit money, and now assumes the more vulgar type of dealing in "green goods." The fact that fictitious capital can be publicly advertised, gives it a financial but not a moral advantage. This, however, would have such decided limitations, credulous as human nature is, that if fictitious capital paid no dividends it would soon have no market. Hence, for the far-seeing promoter, the pressure is toward making some at least of the fictitious capital pay dividends. What is the principle in this case? If we are dealing with a new and untried mode of production or public service, the case is simply that of any speculation. If a proposed product has a possible utility, but at the same time involves so much risk that in the long run only half of such enterprises will succeed, society may consider it worth offering a profit equal to fifty per cent. in order to pay for the risk.
If, on the other hand, the income is to derive from valuable public franchises, or from the growth of the community and its necessities, the case is different. Here there is little, if any, risk for which it is fair for society to pay. The excessive capital beyond the cost is designed to disguise the rate of profit, and therefore conceal from the community the cost of the goods or service. If the public demands cheaper rates it is told that the company is now paying only a fair dividend upon its stock.[247] The usual method of capitalizing many enterprises of a quasi-public sort is to issue bonds to cover the cost of construction or plant, and then one or more series of stocks which are known as "velvet." In part these stocks may represent a work of organization which is a legitimate public service, but in many cases they represent devices for transferring public wealth to private property. Enormous sums have been taken from the public in this manner. The element which makes this method particularly obnoxious is that the quasi-public corporations are given a monopoly by the community and then take advantage of this to capitalize indefinitely the necessities of a growing community. In this case the conception of public service is lost sight of in the "dazzling possibility of public exploitation."[248]
Few methods of extorting wealth have equaled this. In some cases bribery of public officials has added an item of expense to be collected later from the public. When the various forms of public service or protected industry were first projected there was risk involved. It was necessary to offer inducements to capital to engage in them. It was desirable to have railroads, gas, water, express service. But as the factor of risk has been eliminated, the public tires of paying double prices, and a "fair" return must be estimated on the basis of actual rather than fictitious capital. The public has come to have a clear idea as to the morality of such practices as have been employed in letting contracts for public buildings at prices far above market value. The New York City courthouse and Pennsylvania capitol offer familiar examples. Does it differ materially from such practices when a company charges the public an excessive price for transportation or lighting, and when State or municipal authorities authorize by franchise or monopoly such excessive charges? Probably the conscience of the next century, if not of the next generation, will fail to see the superior moral quality of the latter procedure.
Individualism, according as it argues from the platform of natural rights or from that of social welfare, would claim either that individuals should have all the increase because they have a right to all they can get under a system of free contracts, or that it is for the social welfare to allow them all they can get since private property is public wealth. From the standpoint of natural rights the reply would seem to be unanswerable: the community gives the increased value; it belongs to the community. From the standpoint of social welfare the answer is not so simple. It might, for example, be socially desirable to encourage the owners of farming land by leaving to them the increase in value due to the growth of the country, whereas city land-owners might need no such inducement. Investors in a new form of public service corporation might need greater inducements than would be fair to those in enterprises well established. But, although details are complex, the social conscience is working toward this general principle: the community should share in the values which it produces. If it cannot do this by cheaper goods and better service, it must by graded taxation, by ownership, or by some other means. The British government has already considered a measure for ascertaining the land values in Scotland as a preliminary step toward adjustment of this question.
Ideas discussed in this chapter
Text from Project Gutenberg, public domain in the United States.