Economic Foundations of Society

Achille Loria, Lindley M. Keasbey

• Publisher: Routledge
• Year: 2019
• Print ISBN: 9780815372523
• eBook ISBN: 9781351245050
• Topic: Economics
• Subtopic: Economic Theory
• Index: Economics

This book examines the societies of the civilised world - old and new - and its two distinct and separate classes. Whilst one class accumulates in utter idleness enormous and ever increasing revenues, the other, far more numerous, labours life-long for miserable wages.

One class lives without working, the other works without living or without a life worthwhile. When confronted by such a contrast, the question must at once occur to every mind: is this sad state of affairs the result of inherent necessity, inseparable from the organic conditions of human nature; or is it merely the outcome of certain historical tendencies that are destined to disappear at a later stage of social evolution?

It concludes that the truth is to be found in the latter alternative: that capitalistic property, with its caste division of humanity into capitalists and labourers, is by no means the product of conditions inherent in human nature, but simply the result of powerful historical causes which will eventually disappear. A variety of facts are presented in support of this argument.

Part I.
The Economic Foundations of Morality.

Chapter I.
The Morality of the Final Society.

LET us suppose the existence of a free-land economy and its natural corollary, the mixed association of labour. What, then, would be the highest rule of human conduct and how could we be assured of its fulfilment; wherein, in other words, would the ethical sanction of such a system consist? The answer to this question is contained in the supposition itself.

The morality of the final organisation of society simply consists in the acts and abstentions that make for cohesion and social well-being. Individual egoism suffices as a motive, and no further sanction is necessary. By the very hypothesis, all acts injurious to social cohesion and collective well-being, all forms of usurpation between man and man, turn immediately to the disadvantage of the agent himself, and this of itself is enough to show him that such conduct is contrary to his enlightened egoism. The very existence of the mixed association implies that the society in question has already reached that stage in its development when the suppression of the free land no longer accords permanent advantage to the capitalist, as the limitations of production preclude the possibility of acquiring any revenue from capital. No one is, accordingly, inclined to suppress the free land in order to establish a capitalistic economy, inasmuch as he is aware that such suppression carries with it no lasting advantage. Under such conditions, therefore, economic usurpation is absolutely excluded.

But even if usurpation were not thus excluded in the agent’s own interest, any attempt of one producer to injure another must at any rate provoke an immediate reaction injurious to the usurper himself. Indeed, under any economic system where men are free and equal, usurpation is both irrational and anti-egoistic, since it is bound to provoke a corresponding reaction rendering it harmful to the agent himself; but where the economy is associative in character the injury is especially marked. Thus the producer of capital who should endeavour to curtail the compensation of the ordinary labourer would only urge the latter to disrupt the association, thus in the end depriving his own labour of the power and efficiency accorded it by the association. And the result would be the same if the ordinary labourer should attempt to effect an unjust reduction in the compensation of the producer of capital. In like manner, any arbitrary attempt on the part of one class of producers to deprive another class of its legitimate influence in public affairs, would only offer provocation to the injured class to break up the association of labour, and this in turn would result in the ultimate injury of those instrumental in bringing about the original rupture. Thus a rule of justice emerges spontaneously from such a social organisation, originating in the enlightened egoism of all its members.

And over and above this purely negative function, expressed in the dictum, neminem lœde, egoism also enforces the positive and nobler aspects of morality, summed up in the precept, imo omnes quantum potes juva. It is, indeed, but a natural consequence of the associative character of this final economy, that the kindness accorded a co-partner should accrue to the advantage of the benefactor himself. Thus the producer of capital who exhibits a kindly spirit toward the ordinary labourer, actually augments the productive activity of the latter, thus increasing the total product, and therewith adding to the portion thereof which reverts to him, the benefactor. And the same holds true of the acts of kindness performed by a producer of capital to his partners, and of the services rendered by the ordinary labourers to the producers of capital, or to the other workmen with whom they co-operate.

In short, under an economic system where value is exclusively measured by the cost of production, and where no species of monopoly prevails, the favours conferred by one producer upon another accrue to the advantage of the former, as he in his capacity of consumer profits by the improved conditions under which the goods he demands are produced. Thus, from whatever side we look at the matter, abundant proof is offered that individual egoism of itself suffices in the final society to determine a system of morality, assuring social well-being, and corresponding to the highest ideal of virtue imaginable.

Nor is the moral constitution of this final society in the least disturbed by the fact that the several producers may possess different degrees of physical and intellectual force. As a matter of fact, the present disparity in the physical and moral powers of individuals, is largely a bye-product of the capitalistic regime itself, and it may reasonably be expected that the prevailing inequalities among producers will be to a large extent neutralised under non-capitalistic conditions, but we have not to rely upon this contingency to support our contention. The associative character of the final economy of itself renders absolutely irrational all desire on the part of the strong to take advantage of their superiority, to the detriment of the weak; for any such attempt would only impel the weaker producers to retire from the association, and this in turn would render the labour of the strong less efficient, and consequently diminish the return formerly accruing to them. The better endowed may, indeed, profit from their superiority by producing more abundantly, and in obtaining in return a greater reward; but beyond this legitimate advantage, no further privilege is conceivable. Thus, instead of dissipating their forces in a useless and sterile conflict with the weaker producers, the strong apply themselves exclusively to augmenting social production. Under such economic conditions, enlightened egoism may even urge the strong to succour the weak, since the improved condition of the latter accrues to the advantage of the association, and consequently to the strong themselves. Thus not through a spirit of disinterestedness, but simply in accordance with the law of self-interest, the strong naturally devote some of their energies in rendering assistance to co-producers less fortunately endowed.

Thus granting a disparity of forces among the several producers, we are still led back to the same conclusion: under the supposed economic conditions egoism assures the fulfilment of the most scrupulous justice, and makes for general kindliness.¹

Note

¹ It is evident from the above that in order to prove that the ethics of love will be spontaneously established within the final society, it is not necessary to suppose with Bellamy and other socialists, that egoism will cease to be active under this final economic régime, and that each will take pleasure in working for others. This would only be admissible under the supposition that the final society would succeed in changing human nature—a thing at least very problematic. The above demonstration holds good, however, without recourse to any absurd hypothesis. We have simply to take account of the fact that, within an economy where equality prevails, especially if it be associative in character, respect for the well-being of another is in conformity with the egoism of the individual, because every injury and every benefit accorded to others inevitably reacts to the disadvantage or advantage of the agent himself. It is thus with good reason that Lange (Geschichte des Materialismus, Iserlohn, 1875, ii., pp. 470–472) remarks that a morality founded upon egoism would prove both possible and effective in a society of equals. There is, accordingly, nothing strange in the fact that among peoples who know nothing of the inequality of wealth, morality is ruled by egoism, as for example, among the savages of Australia, where every useful act is reputed just (Letourneau, Évolution de la morale, Paris, 1887, p. 172). Hobbes was, therefore, absolutely in the wrong when he conceived the natural state of man to be the war of all against all; for, within an economy where equality prevails, the reciprocal limitations of individual desires must, on the contrary, determine universal peace.

Chapter II.
Morality in the Capitalistic Society.

IF, after having analysed the ultimate conditions of economic evolution, we now turn our attention to the process of development, we shall readily perceive that during these unperfected stages individual egoism dictates a very different rule of conduct. Where the free land is suppressed, society no longer constitutes an aggregate of economic equals, but becomes divided into two distinct and separate classes: one composed of men deprived of their liberty of choice and obliged to work for their living, and the other made up of men with the privilege of living without working—and this latter class is again split up into a number of sub-classes and groups.

During these unperfected stages of economic evolution, a group of men may suppress the free land to advantage and establish thereon their economic superiority. Usurpation becomes thus useful, and, therefore, rational. The strong, who in the free-land economy were unable to take advantage of their strength to the detriment of the weak, may now use force to exclude the weak from the possession of the soil, since from such usurpation they acquire a large and lasting profit. And after having violently suppressed the free land the victorious class may continue to exercise its egoistic instincts in a limitless manner at the expense of the vanquished; for the latter are no longer able to free themselves from this relation of subjection by disrupting the compulsory association of labour. Among a society of equals such offences are impossible, since every man is opposed in the exercise of his own egoism by the egoism of his fellows; but when equality no longer prevails, and society is divided into two classes, the egoism of the masters is given free rein and may go to any excess at the expense of the slaves, because such acts of aggression assure definite advantages to their perpetrators, and there is no longer any fear of retaliation or of refusal to work on the part of the disfranchised. The result is that individual egoism now, for the first time, provokes a series of acts which are distinctly injurious to the greater number of society.

Usurpation also becomes possible in the midst of the proprietary class as well, on account of the disparity of wealth prevailing among the members of this group—a disparity which allows large owners to realise on appropriations and abuses at the expense of the small. But the relations existing among proprietors do not at all resemble those of which we have just been speaking, where some persons possess all the power and others have none, and where rebellion being precluded, domination is the only relation possible. They differ likewise from the relations which prevail in the mixed association among individuals endowed with an equal amount of economic force, and between whom, consequently, all strife is impossible—or, in any event, sterile. They are rather the relations which grow up between individuals who are independent of each other and yet equipped with different economic resources, and placed, accordingly, under conditions where mutual antagonism becomes at once possible, and, at the same time, fruitful in its results.

This competition among proprietors, unequally endowed with economic force, necessarily leads to the encroachment of the stronger upon the weaker; but such usurpation always finds its limit in the strength of the competing proprietors, and in the organic conditions of property itself. The less powerful proprietors—and herein they differ from the labourers—can, to some extent, prevent the aggression of the strong, by uniting their capitals and thus mitigating their economic inferiority. Such is the first check imposed upon the conduct of the larger proprietors in the interest of the smaller. Another no less efficacious check arises from the fact that the inherent conditions of property render it impossible, or at least, very difficult, for proprietors to carry out any such plan of mutual encroachment. To this we may add, that proprietors, great and small, are banded together politically, to form the state, and in their own interests, they are therefore not inclined to be implacable in their reciprocal usurpation. Thus, though the egoism of the proprietors may follow its extreme bent in its manifestations against the proletariat class, whenever it attempts to exert itself in the midst of the proprietary class, it finds powerful obstacles in the strength of the competitors engaged in the struggle and in the organic conditions of property.

But if labourers and small owners can neither frustrate the efforts nor prevent the usurpations of capitalists and large owners, what is to prevent them from having recourse to the ultima ratio of the oppressed—insurrection? If the labourers cannot forsake the capitalist because the free land is suppressed, why do they not rebel and break down this economic system which oppresses them? Is it not perfectly clear that the labourers would naturally endeavour to revolt against this violent suppression, and is not their acquiescence in such suppression therefore in direct contradiction to their most elementary egoistic instincts?¹

Far from ignoring these problems, the capitalistic class has solved them with marvellous adroitness. To this end, capital first has recourse to methods essentially economic in character. By enrolling unproductive labourers on its side, and by making parasites of a number of its hirelings—who, with nothing to do, are still richly paid, and therefore interested in defending the property system—capital renders of less avail the numerical superiority of those excluded from the possession of the soil. But such means of themselves are inadequate to offset the numerical superiority of the labourers, and prevent a revolt on their part, which by virtue of their very numbers must necessarily prove successful. The capitalistic class resorts accordingly to a more decisive method, whose application is again entrusted to the unproductive labourers. The means employed are no longer material in character, but marked with a moral impress. The unproductive labourers, who have no other effective occupation, are now employed in giving a false direction to the egoism of the subjugated classes, and in perverting the calculation on which it is based. This is effected by setting up a fanciful moral sanction over against the labourers’ revolutionary tendencies, causing the disinherited classes to dread the idea of revolt, and to look upon rebellion as more abhorrent even than submission. In this way, the bearing of the proletarians toward their masters (and the same may be said of the attitude of small owners toward the large) comes under the discipline of a moral law, which is exactly calculated to pervert their egoism, and render them tolerant under capitalistic usurpation.

But it does not suffice to proceed against the oppressed classes alone in such a way as to render reaction on their part less probable; it is also necessary to persuade the proprietors themselves not to push their policy of usurpation to the point of provoking the downtrodden classes to revolt in spite of themselves. The conduct of capitalistic proprietors toward the poor and toward small owners has likewise to be disciplined by a series of checks in order to prevent them from going to excesses, endangering the very existence of capitalistic property. It may seem at first as though no sanction were necessary to induce the large proprietors to assume a proper attitude toward the poor and toward the smaller proprietors, as such conduct is really in direct conformity with their enlightened self-interest. But such is not the case. It is true, egoism suffices of itself to direct human conduct so long as the results which it entails are evident and recognised beforehand. Thus, for example, in the society established upon free land, egoism is, of itself, quite enough to prevent aggression, as it is perfectly evident that the immediate effect of any such attempt would be injurious to the agent himself. But the society founded upon the suppression of the free land differs from the free-land society in that social relations are in the latter case unconscious and the agent remains ignorant of the results of his acts. Another fact must also be taken into account in this connection, namely, the possibility afforded by the suppression of the free land of allowing the injury resulting from an action to fall upon other shoulders than those of the person who commits it. In a social economy based upon free land an injurious action reverts at once, and without any possibility of mistake to the disadvantage of the perpetrator, and self-interest urges him accordingly to abstain from like acts in the future. But an evil act perpetrated within an economy where the land has been appropriated only reacts upon him who commits it after a complicated series of repercussions which make it impossible for him to comprehend beforehand the injurious nature of the act that he commits and the consequent necessity of abstaining therefrom. This very complication of capitalistic relations furthermore allows the agent to shift upon others the injury resulting from his own acts, and thus renders his abstention still less rational and essential. As a result, egoism no longer suffices of itself to restrain the conduct of proprietors toward the p...

Table of contents

• Cover
• Half Title
• Title
• Copyright
• Original Title
• SOME OPINIONS OF THE PRESS.
• Dedication
• Translator’s Preface
• Author’s Preface
• TABLE OF CONTENTS.
• Introduction.—The Economic Constitution of Society
• PART I. The Economic Foundations of Morality.
• PART II. The Economic Foundations of the Law.
• PART III. The Economic Foundations of Politics.
• Conclusion.—Economics the Basis of Sociology