PART III

THE PRESUPPOSITIONS OF ECONOMIC THEORY

CHAPTER VIII

THE PHILOSOPHICAL AND PSYCHOLOGICAL PRESUPPOSITIONS

The connection between social philosophy, on the one hand, and metaphysics and epistemology on the other hand, has always been a close one,--a fact not always adequately recognized by writers in the field of social science, in economics, especially. Scientists often "ignore" philosophy, holding that their concern is simply with the world of phenomenal "facts," and that the injection of philosophic considerations is illicit and unscientific.

And this is often well enough in the field of the physical, chemical, and biological sciences, where the procedure is primarily inductive, and the data are got from sense observation. But in the social sciences, where the procedure is so largely deductive, and where the data are often principles of mind, whose truth is a.s.sumed as a starting point for investigation, and especially in economic theory, such an att.i.tude cannot be justified. For philosophical a.s.sumptions _will_ creep in, and the scientist has no option about it. The only thing he can do is to be critical, and know definitely _what_ philosophical a.s.sumptions he is making,--and most of our treatises on economic theory do not bear evidence that this critical work has been done.

There may be traced in the history of philosophy, in the ancient world, and also in the modern era, three main stages in philosophic thought, each accompanied by a distinctive set of ideas concerning the nature of society.

In distinguishing these three stages, in showing the relation of each to social philosophy, and especially in tracing a parallel between the philosophy of the ancients and that of modern times, I recognize the grave dangers of giving a superficial treatment, and of distorting facts to make them fit a schematism. I recognize, further, that a host of details and a mult.i.tude of differences must be ignored in tracing the parallel I propose.

Considerations of s.p.a.ce, moreover, prevent such a detailed justification of the views here presented as would be required were this more than a minor phase of my subject. The need for this is lessened, however, by the fact that much of what follows is part of the commonplaces of the history of philosophy,--albeit a repet.i.tion of it seems needed in a criticism of economic theory. The three stages are: the dogmatic stage; the skeptical stage; and the critical stage. In Greek philosophy, the first stage is represented by the cosmological philosophers, as Thales, Anaximenes, and Anaximander, who, with perfect confidence in the power of their minds to solve the riddles of the universe, or rather, without questioning that point at all, proceeded to spin out poetical accounts of the origin and nature of things. The second stage is represented by the Sophists, who, struck by the manifold divergences in the philosophies of the earlier schools, and by the lack of harmony between the G.o.d-given laws and rules of morality which earlier tradition had handed down, and the needs of the social conditions among which they lived, found themselves unable to find truth readily, and reached the conclusion that each man is the measure of truth, that there are no universal criteria, or valid standards. The third stage begins with Socrates, who sought for a common principle of truth and justice in the midst of divergences, and this critical movement, continued by Plato and Aristotle, led to conceptions of unity once more.

Now the social philosophy which goes with the first stage is relatively undefined. It is for the most part content with the existing order, recognizes a supernatural basis for it, and raises few questions. The social philosophy of the second period is intensely individualistic. In the third stage, the emphasis upon social solidarity and upon a unified, organic conception of society, a society which is paramount to individual interests and rights, comes to the fore again. The extreme poles of thought are, on the one hand, an individualism which leaves scant room for any very significant social relations whatsoever, and, on the other hand, a socialism--like that of the _Republic_--which swallows up the individual.

The compromise view, expressed in the Aristotelian doctrine of the relation between "form" and "matter," applied to the social problem, finds the individual very real, to be sure, but still real only in his social relationships. Individual activities are facts, but social activity is more than a mere sum of individual activities. Society and the individual are alike abstractions, if viewed separately.

The mediaeval conflict over realism and nominalism really derives its interest from the practical social issues involved, for the reality of the Church, as more than a mere aggregate of its members, and the validity of Christian doctrine, as more than the sum of individual beliefs, are at stake.

The cycle began again in modern times. As representatives of the dogmatic period in modern philosophy, DesCartes and Spinoza may be chosen. They were not, of course, navely dogmatic, for philosophy had learned much from its many disappointments, and DesCartes, especially, starts out with reflections which would seem to make him very much a skeptic. And yet each believed in the power of the mind to draw absolute truth from itself, and each proceeded in a highly rationalistic way to build up his system. The very t.i.tle of Spinoza's great work indicates this att.i.tude of mind: "_Ethica more geometrico demonstrata_." The conception of society which characterizes this period is, again, not nave, but still has a supernatural, or at least a superhuman, basis, for it is in a Law of Nature (capitalized and personified) that social inst.i.tutions find their origin and justification. Critical reflections, starting with Locke, and pa.s.sing through Berkeley to the absolute skepticism of Hume, bring in the second, or skeptical, period, in which the rationalistic-dogmatic cert.i.tude of Spinoza and DesCartes is banished. And going with this movement in philosophic thought comes the extreme individualism of Rousseau in politics, and Adam Smith in economics. The movement away from skepticism, beginning with Kant, puts the world, and especially society, back into organic connections again, and we have, in Hegel, especially, society to the fore, and the individual real only as a part of society. The organic conception, revived by Hegel, and vitalized by the positivistic studies which applied the Darwinian doctrine to social phenomena, has characterized the greater part of the social philosophy of the last half hundred years--of course, not without protest and highly necessary criticism.

Now all of this is, of course, commonplace. And yet a failure to recognize it has vitiated very much thinking in the field of economic theory.

Economic thought is to-day very largely based on the philosophic conceptions which characterize the period in which economics began to be a differentiated science,--the skeptical doctrines of David Hume, the close friend of Adam Smith.[88] The individual is all-important; his world of thought and feeling is shut off from that of every other man; social relationships are largely mechanical, and grow out of calculating self-interest on the part of the individual; social laws are conceived after the a.n.a.logy of physical laws. Ethics and politics, however, have been far more influenced by later thinking, and the organic conception of society has largely dominated these sciences of late, while the new science, sociology, free to base itself more largely upon present-day epistemological, philosophical, and psychological notions, has gone further than any other in accepting the doctrine of the unity and pervasiveness of social relations, organically conceived. I think there are few things more strikingly in contrast than the conception of society which the student meets in most works on economic theory, and that which he meets in studying the other social sciences. That this is so is due precisely to the fact that the economists have too largely neglected philosophy and psychology, and have accepted uncritically the a.s.sumptions of the founders of the science. Doctrines accepted then have become _crystallized_, and still form part of the current stock in trade of economic science, even though rejected by philosophy itself.

To one of these faulty doctrines from the earlier time, attention has already been called. It is that the intensities of wants and aversions in the mind of one man stand in no relation to the same phenomena in the mind of another man, and that there can be no comparison inst.i.tuted between them. The individual is an isolated monad,[89] mechanically connected with his fellows, who are to him "a part of the _non-ego_,"[90] but spiritually self-sufficient and inaccessible. The doctrine appears in Marshall's statement:[91] "No one can compare and measure accurately against one another even his own mental states at different times, and no one can measure the mental states of another at all, except indirectly and conjecturally, by their effects." Pareto I have quoted, as also Jevons, in chapter IV. The doctrine appears in Professor Veblen's recent article in criticism of Professor Clark:[92]--

It is evident, and admitted, that there can be no balance, and no commensurability, between the laborer's disutility (pain) in producing the goods and the consumer's utility (pleasure) in consuming them, inasmuch as these two hedonistic phenomena lie each within the consciousness of a distinct person. There is, in fact, _no continuity of nervous tissue_ [italics mine] over the interval between consumer and producer, and a direct comparison, equilibrium, equality, or discrepancy in respect of pleasure and pain can, of course, not be sought except within each self-balanced individual complex of nervous tissue.

In the recent elaborate study, _Value and Distribution_, by Professor H. J.

Davenport, the theories based on the conception of the individual as an isolated monad, a self-complete whole, with purely mechanical relationships with other men, find their fullest and most self-conscious expression, and the philosophical presuppositions are explicitly premised. The following quotation from Thackeray's _Pendennis_ is given as a footnote,[93] in which Professor Davenport's own conception is expressed:--

Ah, sir, a distinct universe walks about under your hat and under mine--all things in nature are different to each--the woman we look at has not the same features, the dish we eat has not the same taste, to the one and to the other; you and I are but a pair of infinite isolations, with some fellow islands a little more or less near us.

This is, of course, manifestly the theme of the old subjectivistic a.n.a.lysis, by which all things are reduced to thoughts, sensations, and desires within the individual soul, and in accordance with which we have none save conjectural knowledge of anything outside of our own souls. Now a general answer might be given that this is an epistemological principle which holds true only for what Kant calls the "_Ding an sich_,"--if such a thing there be--and that there is no more reason why it should apply to human emotions, considered purely as phenomena, than to any other of the phenomena with which science busies itself. If this principle be adhered to, its effect will be simply to cast doubt on the conclusions of all sciences, physical as well as psychical. Certainly psychology would be impossible on this a.s.sumption, except in so far as the psychologist claims only to be working out a science of his individual soul, which, so far as he knows, is not true of any other individual. But it is precisely _not_ this that psychology attempts. It is concerned with the laws and behavior of minds in general, with the "_typisch und allgemeingultig_" and not with the mental idiosyncrasies of the particular individual.

But the doctrine can be met from the standpoint of epistemology itself. The writers who are responsible for this subjective a.n.a.lysis, have held that _mind_ is more nearly capable of being known by mind than is anything else, since we can interpret things only in terms of our own experiences. The real nature of a purely physical thing is far more deeply hidden from our view than is the real nature of a mental fact, even though it be in the mind of another. And especially would they grant a degree, at least, of objective currency to clearly phrased conceptual thought. Now I base myself upon the present day pragmatic philosophy,[94] which is, essentially, concerned with the problem of knowledge. Its principle is that we believe things to be true, not because of any knowledge we have of some mystical, absolute truth, but because of our experiences of utilitarian sort. That is true which works. That is true which we find will satisfy our desires and needs. In a word, desire, volition, _values_, lie at the basis of intellect.[95] Whence it follows, that if our minds are so const.i.tuted that we understand each other on the intellectual side, then there must be a still deeper and more underlying similarity on the desire, feeling, volitional side.[96] Consequently, if there be anything at all, outside of our own mind, which we _can_ understand, it must be the feelings and emotions of other men.

Considerations of a practical nature give us the strongest possible grounds for a belief that human desires, feelings, etc., are h.o.m.ogeneous and communicable. The fact is that we all have back of us many millions of years of evolutionary history in the same general environment. In the past, with relatively minor variations, the same influences have played upon our ancestors from the beginnings of life on our planet. And then, we are born into the same society, and it has given us, not, to be sure, the power of reaction, but certainly all of our most important stimuli.[97] Further, we do get along in society. We laugh together, we play together, we share each other's sorrows, we love and hate each other, in a way that would be wholly impossible if we did not in practice a.s.sume the correctness of our "inferences" about one another's motives and desires. And the fact that these "inferences" are in the main correct is the one thing that makes social life possible. We can, and do, understand one another's motives, desires, wants, emotions. We can, and do, constantly communicate our feelings to one another.

It is only on the basis, further, of an intellectualistic psychology that such a subjectivistic conception is possible. If the voluntaristic psychology and the doctrine of "the unconscious" be accepted--and certainly the psychological facts on which the latter is based must be accepted, whether the metaphysical conclusions are or not[98]--we have no basis whatever for this doctrine that clearness holds within the mind, but that without all is uncertain. Really, only a little part of our mental life is in consciousness at any given moment. The "stream of consciousness" is but a narrow thing, and the unity of the individual mind is a unity, not of consciousness, but of _function_. As Goethe somewhere says, we know ourselves never by reflection, but by action. And often does it happen that a sympathetic friend, or even an observant enemy, may interpret more accurately our actions than we ourselves can do, and may measure more accurately the strength of a given motive for us than we can ourselves. In a certain sense, our knowledge of other minds is inference. We see other men's actions, or hear their voices, or watch the muscles of their faces, and so, indirectly, get at their thoughts and feelings. But, in much the same sense, our knowledge of their actions, or of their voices, is inference too. For we must interpret the image on the retina, or the sense excitation in the ear. But practically, neither is inference, if by inference be meant a consciously made judgment from premises of which we are conscious. In a casual walk with a friend, where conversation flows smoothly on easy topics, one is as _immediately_ conscious of his friend's thoughts and feelings, expressed in the conversation, as he is of the scenes that present themselves by the way, or even of the thoughts that arise within himself.[99]

The significance of this conclusion is not quite the same as that which might be expected from the context from which I have taken the doctrine under criticism. The feelings of men with reference to economic goods are facts of definite, tangible nature, and subject-matter of social knowledge. But we have not yet reached a standard or source of social value. No h.o.m.ogeneous "labor jelly," or "pain jelly," or "utility jelly,"[100] made up by averaging arithmetically, or adding arithmetically, individual efforts or pains or pleasures, will solve our problem for us--as indeed I have been at pains to show in what has gone before. The purpose of the foregoing criticism is primarily to clear the ground for a conception of social organization which is more than mechanical, and in which the individual is both less and more than a self-sufficient monad.

FOOTNOTES:

[88] This criticism applies to the teachings of James Mill, J. S. Mill, and other sensationalist followers of Hume, even more than to Adam Smith. But see Professor Albion W. Small's _Adam Smith and Modern Sociology_, Chicago, 1907, esp. p. 51.

[89] It is easy for "a.n.a.lysis" to separate society into "individual"

monads, and impossible for "synthesis"--once the validity of the a.n.a.lytic process is accepted--to put society together again. In fact, once the a.n.a.lytic process is begun, and once its results are accepted as anything more than matters of logical convenience, all unity and all organic connections, whether in the social or in other fields, seem to vanish like a dissolving show. There is a psychological doctrine of monadism, quite as logical as the sociological monadology here criticized, which finds it impossible to link together even the elements in a single individual's mind. (See William James, _Principles of Psychology_, 1905 ed., vol. I, pp.

179-80.) Into what inextricable difficulties one falls, in pursuing the monadistic logic, is more dramatically ill.u.s.trated than by anything else I know by Bradley's _Appearance and Reality_, esp. chaps. II and III. The most useful viewpoint seems to be as follows: unity is as much an object of immediate knowledge as is plurality,--both being, in fact, the products of reflective thought. And unity is no more called upon to justify itself, before we recognize its existence, than is plurality. _Cf._ William James, _The Meaning of Truth_, New York, 1909, p. xiii; and also his _Psychology_, vol. I, pp. 224-25. _Cf._ also the writings of Professor John Dewey.

[90] Jevons, _Theory of Pol. Econ._, 3d ed., p. 14.

[91] _Principles_, 1907, p. 15 (1898 ed., p. 76). See also Marshall's criticism of Cairnes' conception of supply and demand, in the 1898 edition of the _Principles_, p. 172.

[92] "Professor Clark's Economics," _Q. J. E._, 1908, p. 170.

[93] Davenport, _op. cit._, p. 300, n. It may seem somewhat unfair to hold a man responsible for the view of another writer which he throws into a footnote of his own book. One who has read Professor Davenport's book, however, will recognize, I think, that this quotation does express Professor Davenport's view. His discussion in the text on pages 300-301 affirms virtually this same doctrine, as a proposition of psychology. See also his discussions in small type on pages 336-37. His whole system is based upon this doctrine.

[94] See, especially, William James, _Pragmatism_, and _The Meaning of Truth_; John Dewey, _Essays in Logical Theory_; and F. C. S. Schiller, _Humanism_.

[95] The utter impossibility of adequately summing up a philosophic doctrine in two or three sentences will excuse this statement to those pragmatists who would prefer a somewhat different formulation.

[96] I am indebted for suggestions here to Professor H. W. Stuart's article on "Valuation as a Logical Process," in Dewey's _Studies in Logical Theory_, pp. 322-23.

[97] _Cf._ Baldwin, _Social and Ethical Interpretations_, _pa.s.sim_, and Cooley, _Human Nature and the Social Order_, _pa.s.sim_.

[98] The most interesting discussion of these topics I know is that of Friedrich Paulsen, in his _Introduction to Philosophy_ (translated by Professor Frank Thilly).

[99] _Cf._ Perry, R. B., "The Hiddenness of the Mind," _Jour. of Phil., Psy., and Sci. Meth._, Jan. 21, 1909; "The Mind Within and the Mind Without," _Ibid._, April 1, 1909; "The Mind's Familiarity with Itself,"

_Ibid._, March 4, 1909. Urban, W. M., _Valuation_, p. 243.

[100] Davenport, _op. cit._, p. 331.

CHAPTER IX

THE SOCIOLOGICAL PRESUPPOSITIONS

Conceptions of the social unity fall, in the main, into three cla.s.ses: the mechanical, the biological, and the psychological. Each of these conceptions recognizes, of course, that the individual has a mind, but the first thinks of that mind as so shut in that the only connections between men must be of an external sort; the second sees modes of collective action _a.n.a.logous_ to the modes of individual action, and reaches the conception of a social mind by a.n.a.logy; while the third treats the social mind as an empirical fact, the phenomena of which can be studied as concrete things in detail. And there are gradations here, and combinations.

The following extract, freely translated and substantially abridged, is taken from chapter I of DeGreef's _Introduction a la Sociologie_:--

It is in vain that Spencer protests against the accusation that he has a.s.similated the laws of biology with those of sociology. The confusion is everywhere complete. He has not indicated a single law, nor a single phenomenon, which has not its correspondent, if not its equivalent, in the antecedent sciences. Draper, in his _History of the Intellectual Development of Europe_, adopts precisely the doctrine that the laws of biology apply equally to sociology. Man is the archetype of society. Nations pa.s.s through their periods of infancy, adolescence, maturity, age, death.

This sort of thing makes sociology wholly unnecessary.

The attempt of Stanley Jevons to explain economic crises by sun-spots, so far from being an effort of genius, is simply a _jeu d'esprit_. It is simply a recognition of the common fact that climate is one of the factors that influence man in society. According to Hesiod, physical forces first engender each other, then in turn the G.o.ds and man. Since then, social science has in turn been founded on the laws of astronomy, chemistry and biology. To-day it is the last, vitiated, further, by false psychological notions about the power and unlimited liberty of the reason, and the consciousness of human individuals, and applied by a.n.a.logy to the collective reason.

The error consists in looking for the explanation of social phenomena in the most general laws. This is natural within certain limits, but has been pushed to extreme, but logical consequences, by the American, Carey (_Social Science_). He looks, in effect, to one of the oldest sciences, and one, consequently, relating to the most highly general phenomena, those of astronomy, for the universal laws of society. Geometry, he holds, gives us principles equally valid for the chemist, the sociologist, and for him who measures the earth. A system a.s.suming to explain complex phenomena solely by the laws of phenomena more simple, may be compared to the effort to give an account of a book, not by reading it line by line, but by examining the cover and the t.i.tle-page.

As DeGreef elsewhere puts it, there is a hierarchy in science, proceeding from the more general to the less general, depending on the nature of the phenomena studied. This hierarchy has been variously stated. Comte puts it thus: mathematics, astronomy, physics, chemistry, physiology, social physics (sociology). Baldwin,[101] writing much later, of course, puts it thus:--