The science of political economy

Front matter

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Take, since you bade it should bear, These, of the seed of your sowing- Blossom or berry or weed.

Sweet though they be not, or fair, That the dew of your word kept growing ; Sweet at least was the seed.

—Swinburne to Mazzini.

TO

AUGUST LEWIS OF NEW YORK

AND

TOM L. JOHNSON OF CLEVELAND, OHIO,

WHO, OF THEIR OWN MOTION, AND WITHOUT SUGGESTION OR THOUGHT OP MINE, HAVE HELPED ME TO THE LEISURE NEEDED TO WRITE IT, I AFFEC- TIONATELY DEDICATE WHAT IN THIS SENSE IS THEIR WORK

Prefatory Note

THIS work, begun in 1891, after returning from a lecturing tour through Australia and a trip around the world, grew out of the author's long-cherished purpose to write a small text-book, which should present in brief the principles of a true political economy. This '' Primer of Political Economy " was to set forth in direct, didactic form the main principles of what he conceived to be an exact and indisputable science, leaving controversy for a later and larger work.

Before proceeding far, however, the author realized the difficulty of making a simple statement of principles while there existed so much confusion as to the meaning of terms. He therefore felt impelled to change his plan, and first to present the larger work, which should recast political economy and examine and explicate terminology as well as principles ; and which, beginning at the beginning, should trace the rise and partial development of the science in the hands of its founders a century ago, and then show its gradual emasculation and at last abandonment by its professed teachers— accompanying this with an account of the extension of the science outside and independently of the schools, in the philosophy of the natural order now spreading over the world under the name of the single tax.

Soon after this work had got well under way the author laid it aside to write a brochure in reply to a papal encyclical ("The Condition of Labor," 1891), and again later vi PREFATORY NOTE.

to write a book exposing Mr. Herbert Spencer's recantation of principles on tbe land question (" A Perplexed Philosopber," 1892). Save for these interruptions, and occasional newspaper and magazine writing, and lecturing and political speaking, he devoted himself continuously to his great undertaking until he entered the mayoralty campaign, toward the close of which death came, October 29, 1897.

" The Science of Political Economy," if entirely finished as planned by the author, would have shown Book V., on Money, extended, and the nature and function of the laws of Wages, Interest and Rent fully considered in Book IV. ; but the work as left was^ in the opinion of its author, in its main essentials completed, the broken parts, to quote his own words a few days before his death, ''indicating the direction in which my [his] thought was tending."

The author's preface is fragmentary. It bears in the manuscript a penciled date, "March 7, 1894," and is here transcribed from a condensed writing used by him in his preliminary " roughing-out " work.

Aside from the filhng in of summaries in four chapter headings (indicated by foot-notes), the addition of an index, and the correction of a few obvious clerical errors, the work is here presented exactly as it was left by the author— the desire of those closest to him being that it should be given to the world untouched by any other hand.

Henry George, Jr.

New York, February 1, 1898.

Preface

IN " Progress and Poverty " I recast political economy in what were at the time the points which most needed recasting. Criticism has but shown the soundness of the views there expressed.

But " Progress and Poverty " did not cover the whole field of political economy, and was necessarily in large measure of a controversial rather than of a constructive nature. To do more than this was at the time beyond the leisure at my command. Nor did I see fully the necessity. For while I realized the greatness of the forces which would throw themselves against the simple truth which I endeavored to make clear, I did think that should "Progress and Poverty" succeed in commanding anything like wide attention there would be at least some of the professed teachers of political economy who, recognizing the ignored truths which I had endeavored to make clear, would fit them in with what of truth was already understood and taught.

The years which have elapsed since the publication of "Progress and Poverty" have been on my part devoted to the propagation of the truths taught in " Progress and Poverty" by books, pamphlets, magazine articles, newspaper work, lectures and speeches, and have been so greatly successful as not only far to exceed what fifteen years ago I could have dared to look forward to in this time, but to have given me reason to feel that of all the

vii viii PEEFACE.

men of whom I have ever heard who have attempted anything like so great a work against anything like so great odds, I have been in the result of the endeavor to arouse thought most favored.

Not merely wherever the English tongue is spoken, but in all parts of the world, men are arising who will carry forward to final triumph the great movement which '' Progress and Poverty " began. The great work is not done, but it is commenced, and can never go back.

On the night on which I finished the final chapter of '' Progress and Poverty" I felt that the talent intrusted to me had been accounted for— felt more fully satisfied, more deeply grateful than if all the kingdoms of the earth had been laid at my feet ; and though the years have justified, not dimmed, my faith, there is still left for me something to do.

But this reconstruction of political economy has not been done. So I have thought it the most useful thing I could do to drop as far as I could the work of propaganda and the practical carrying forward of the movement to do this.

GENERAL CONTENTS.

GRAND DIVISIONS.

GENERAL INTRODUCTION.

Chapter I. The Three Factors Of The World

SHOWING THE CONSTITUENTS OF ALL WE PERCEIVE.

Meaning of factor ; and of philosophy ; and of the world — What we call spirit — What we call matter — What we call energy —

GENERAL CONTENTS.

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Though these three may be at bottom one, we must separate them in thought — Priority of spirit 9

Chapter II. Man, His Place And Powers

SHOWING OUR RELATIONS TO THE GLOBE, AND THE QUALITIES THAT ENABLE US TO EXTEND OUR KNOWLEDGE OF IT AND OUR POWERS ON IT.

Man's earliest knowledge of his habitat — How that knowledge gi'ows, and what civilized men now know of it — The essential distinction between man and other animals — In this lies his power of producing and improving 11

Chapter III. How Man's Powers Are Extended

SHOWING THAT THEIR USE OP REASON WELDS MEN INTO THE SOCIAL ORGANISM OR ECONOMIC BODY.

Extensions of man's powers in civilization — Due not to improvement in the individual but in the society — Hobbes's ''Leviathan " — The Greater Leviathan — This capacity for good also capacity for evil 19

CHAPTER rV.

CIVILIZATION — WHAT IT MEANS.

SHOWING THAT CIVILIZATION CONSISTS IN THE WELDING OF MEN INTO THE SOCIAL ORGANISM OR ECONOMIC BODY.

Vagueness as to what civilization is — Guizot quoted — Derivation and original meaning — Civilization and the State — Why a word referring to the precedent and greater has been taken from one referring to the subsequent and lesser . . .24

Chapter V. The Origin And Genesis Of Civilization

SHOWING THE NATURE OF REASON ; AND HOW IT IMPELS TO EXCHANGE, BY WHICH CIVILIZATION DEVELOPS.

Reason the power of tracing causal relations — Analysis and synthesis — Likeness and unlikeness between man and other ani-

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mals — Powers that the apprehension of causal relations gives — Moral connotations of civilization— But begins with and increases through exchange — Civilization relative, and exists in the spiritual 29

Chapter VI. Of Knowledge And The Growth Of Knowledge

SHOWING THAT THE GROWTH OF KNOWLEDGE IS BY COOPER- ATION, AND THAT IT INHERES IN THE SOCIETY.

Civilization implies greater knowledge — This gain comes from cooperation — The incommunicable knowing called skill — The communicable knowing usually called knowledge — The relation of systematized knowledge to the means of storing knowledge, to skill and to the economic body— Illustration from astronomy 39

Chapter VII. Of Sequence, Consequence And Laws Of Nature

SHOWING THE PROPER MEANING OP SEQUENCE AND OF CON- SEQUENCE, AND WHY WE SPEAK OF LAWS OF NATURE.

Coexistence and succession — Sequence and consequence — Causes in series ; names for them — Our direct knowledge is of spirit — Simplest perception of causal relation — Extensions of this — The causal search unsatisfied till it reaches spirit — And finds or assumes intent — Early evidences of this — Why we must assume a superior spirit— Evidences of intent — The word nature and its implication of will or spirit — The word law — The term " law of nature " 44

CHAPTER Vin.

OF THE KNOWLEDGE PROPERLY CALLED SCIENCE.

SHOWING THAT SCIENCE DEALS ONLY WITH LAWS OP NATURE, AND THAT IN THE CURRENT POLITICAL ECONOMY THIS HAS BEEN FORGOTTEN.

Proper meaning of science — It investigates laws of nature, not laws of man — Distinction between the two— Their confusion in the current political economy— Mason and Lalor's "Primer of Political Economy " quoted — Absurdity of this confusion — Turgot on the cause of such confusions 58 xii GENERAL CONTENTS.

Chapter IX. The Economy Called Political Economy

SHOWING THE MEANING, UNITS AND SCOPE OP POLITICAL ECONOMY.

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The word economy— The word political— Origin of the term "political economy" and its confusions — It is not concerned with the body politic, but with the body economic — Its units, and the system or arrangement of which it treats — Its scope . 65

Chapter X. The Elements Of Political Economy

SHOWING HOW POLITICAL ECONOMY SHOULD PROCEED AND WHAT RELATIONS IT SEEKS TO DISCOVER.

How to understand a complex system — It is the purpose of such a system that political economy seeks to discover — These laws, natural laws of human nature — The two elements recognized by political economy — These distinguished only by reason — Human will affects the material world only through laws of nature — It is the active factor in all with which political economy deals 74

CHAPTER XL OF DESIRES AND SATISFACTIONS.

SHOWING THE WIDTH AND IMPORTANCE OF THE FIELD OP POLITICAL ECONOMY.

Action springs from desire and seeks satisfaction — Order of desires — Wants or needs — Subjective and objective desires — Material and immaterial desires — The hierarchy of life and of desires 81

Chapter XII. The Fundamental Law Of Political Economy

SHOWING THAT THE LAW FROM WHICH POLITICAL ECONOMY PRO- CEEDS IS THAT MEN SEEK TO SATISFY THEIR DESIRES WITH THE LEAST EXERTION.

Exertion followed by weariness — The fact that men seek to satisfy their desires with the least exertion — Meaning and analogue — Exemplified in trivial things — Is a law of nature and

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the fTindamental law of political economy — Substitution of selfishness for this principle — Buckle quoted — Political economy requires no such assumption — The necessity of labor not a curse 86

Chapter XIII. Methods Of Political Economy

SHOWING THE NATURE OP THK METHODS OP INVESTIGATION THAT MAY BE USED IN POLITICAL ECONOMT.

Deductive and inductive schools — "New American Cyclopedia" quoted — Triumph of the inductionists — The method of induction and the method of deduction — Method of hypothesis. Bacon's relation to induction — Real error of the deductionists and the mistake of the inductionists — Lalor's Cyclopedia quoted — Result of the triumph of the inductionists — A true science of political economy must follow the deductive method — ^Davis's ' ' Elements of Inductive Logic " quoted — Double assurance of the real postulate of political economy — Method of mental or imaginative experiment 92

Chapter XIV. Political Economy As Science And As Art

SHOWING THAT POLITICAL ECONOMY IS PROPERLY A SCIENCE, AND THE MEANING IT SHOULD HAVE IP SPOKEN OP AS ART.

Science and art — There must be a science of political economy, but no proper art — What must be the aim of an art of political economy — White art and black art — Course of further investigation 101

Chapter I. Confusions As To The Meaning Of Wealth

SHOWING THE FAILURE OP THE CURRENT POLITICAL ECONOMY TO DEFINE WEALTH, AND THE CONFUSIONS THEREFROM, CULMI- NATING IN THE ABANDONMENT OF POLITICAL ECONOMY BY ITS PROFESSED TEACHERS.

Wealth the primary term of political economy — Common use of the word — Vagueness more obvious in political economy — xiv GENERAL CONTENTS.

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Adam Smith not explicit— Increasing conftision of subsequent writers — Their deiinitions — Many make no attempt at definition — PeiTy's proposition to abandon the term — Marshall and Nicholson — Failure to define the term leads to the abandonment of political economy — This concealed under the word "economic"— The intent expressed by Macleod— Eesidts to political economy 117

Chapter II. Causes Of Confusion As To The Meaning Of Wealth

SHOWING THE REAL DIFFICULTY THAT BESETS THE ECONOMIC DEFINITION OF WEALTH.

Effect of slavery on the definition of wealth — Similar influences now existing — John S. Mill on prevalent delusions — Genesis of the protective absurdity — Power of special interests to mold common opinion — Of injustice and absurdity, and the power of special interests to pervert reason — Mill an example of how accepted opinions may blind men — Effect upon a philosophical system of the acceptance of an incongruity — Meaning of a saying of Christ — Influence of a class profiting by robbery shown in the development of political economy — Archbishop Whately puts the cart before the horse — The power of a great pecuniary interest to affect thought can be ended only by abolishing that interest — This shown in American slavery . 131

Chapter III. What Adam Smith Meant By Wealth

SHOWING HOW ESSENTIALLY ADAM SMITH'S PRIMARY CONCEPTION OF WEALTH DIFFERED FROM THAT NOW HELD BY HIS SUCCES- SORS.

Significance of the title " Wealth of Nations" — Its origin shown in Smith's reference to the Physiocrats — His conception of wealth in his introduction — Objection by Malthus and by Maeleod — Smith's primary conception that given in " Progress and Poverty " — His subsequent confusions 143

Chapter IV. The French Physiocrats

SHOWING WHO THE FIRST DEVELOPERS OF A TRUE SCIENCE OF POLITICAL ECONOMY WERE," AND WHAT THEY HELD.

Quesnay and his followers — The great truths they grasped and the cause of the confusion into which they fell — This used to discredit their whole system, but not really vital — They were

GENEEAL CONTENTS. xv

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real free traders — The scant justice yet done them— Eeference to them in "Progress and Poverty "— Macleod's statement of their doctrine of natural order — Their conception of wealth — Their day of hope and their fall 148

Chapter V. Adam Smith And The Physiocrats

SHOWING THE RELATION BETWEEN ADAM SMITH AND THE PHYSIOCRATS.

Smith and Quesnay — The " Wealth of Nations " and Physioeratie ideas — Smith's criticism of the Physiocrats — His failure to appreciate the single tax — His prudence 160

Chapter VI. Smith's Influence On Political Economy

SHOWING WHAT THE "WEALTH OF NATIONS" ACCOMPLISHED AND THE COURSE OF THE SUBSEQUENT DEVELOPMENT OF PO- LITICAL ECONOMY.

Smith, a philosopher, who addi-essed the cultured, and whose attack on mercantilism rather found favor with the powerful landowners — Not entirely exempt from suspicion of radicalism, yet pardoned for his affiliation with the Physiocrats — Efforts of Malthus and Rieardo on respectabilizing the science — The fight against the corn-laws revealed the true beneficiaries of protection, but passed for a free-trade victory, and much strengthened the incoherent science — Confidence of its scholastic advocates — Say's belief in the result of the colleges taking up political economy — Torrens's confidence — Failure of other countries to follow England's example — Cairnes doubts the effect of making it a scholastic study — His sagacity proved by the subsequent breakdown of Smith's economy — The true reason 170

Chapter VII. Ineffectual Gropings Toward A Determina- Tion Of Wealth

SHOWING THE OPPOSITION TO THE SCHOLASTIC ECONOMY BEFORE "progress AND POVERTY."

Illogical character of the "Wealth of Nations "—Statements of natural right- Spence, Ogilvie, Chalmers, Wakefield, Spencer, Dove, Bisset — Vague recognitions of natural right — Protection gave rise to no political economy in England, but did elsexvi GENEEAL CONTENTS.

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where — Germany and protectionist political economy in the United States — Divergence of the schools — Trade-unionism in socialism 182

Chapter VIII. Breakdown Of Scholastic Political Economy

SHOWING THE KEASON, THE RECEPTION, AND EFFECT ON PO- LITICAL ECONOMY OF "PROGRESS AND POVERTY."

"Progress and Poverty" — Preference of professors to abandon the " science " rather than radically change it, brings the breakdown of scholastic economy — The "Encyclopaedia Britannica" — The "Austrian school" that has succeeded the "classical" 200

Chapter IX. Wealth And Value

SHOWING THE REASON FOR CONSIDERING THE NATtTRE OF VALUE BEFORE THAT OF WEALTH,

The point of agreement as to wealth — Advantages of proceeding from this point 210

Chapter X. Value In Use And Value In Exchange

SHOWING THE TWO SENSES OF VALUE; HOW THE DISTINCTION HAS BEEN IGNORED, AND ITS REAL VALIDITY ; AND THE REASON FOR CONFINING THE ECONOMIC TERM TO ONE SENSE.

Importance of the term value — Original meaning of the word — Its two senses — Names for them adopted by Smith — Utility and desirability — Mill's criticism of Smi h — Complete ignoring of the distinction by the Austrian school — Cause of this confusion — Capability of use not usefulness — Smith's distinction a real one — The dual use of one word in common speech must be avoided in political economy — ^Intrinsic value . . 212

Chapter XI. Economic Value— Its Real Meaning And Final Measure

SHOWING HOW VALUE IN EXCHANGE HAS BEEN DEEMED A RELATION OF PROPORTION ; AND THE AMBIGUITY WHICH HAS LED TO THIS.

The conception of value as a relation of proportion — It is really a relation to exertion — Adam Smith's perception of this — His reasons for accepting the term value in exchange — His confusion and that of his successors 226

GENERAL CONTENTS. xvii

Chapter XII. Value In Exchange Really Related To Labor

SHOWING THAT VALUE DOES NOT COME FEOM EXCHANGEABILITY, BUT EXCHANGEABILITY FROM VALUE, "WHICH IS AN EXPRESSION OP THE SAVING OF LABOR INVOLVED IN POSSESSION.

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Root of the assumption that the sum of values cannot increase or diminish — The fundamental idea of proportion — We cannot really think of value in this way — The confusion that makes us imagine that we do — The tacit assumption and reluctance to examine that bolster the current notion — Imaginative experiment shows that value is related to labor — Common facts that prove this — Current assumption a fallacy of undistributed middle — Various senses of " labor " — Exertion positive and exertion negative — Re-statement of the proposition as to value — Of desire and its measurement — Causal relationship of value and exchangeability — Imaginative experiment showing that value may exist where exchange is impossible — Value and expression of exertion avoided ....... 235

CHAPTER Xm.

THE DENOMINATOR OF VALUE.

SHOWING WHAT VALUE IS, AND ITS RELATIONS.

What value is— The test of real value— Value related only to human desire— This perception at the bottom of the Austrian school— But its measure must be objective--How cost of production acts as a measure of value — Desire for similar things and for essential things — Application of this principle — Its relation to land values 250

Chapter XIV. The Two Sources Of Value

SHOWING THAT THERE IS A VALUE FROM PRODUCTION AND ALSO A VALUE FROM OBLIGATION.

Value does not involve increase of wealth — Value of obligation —Of enslavement— Economic definition of wealth impossible without recognition of this difference in value— Smith's confusion and results— Necessity of the distinction— Value from production and value from obligation — Either gives the essen-

• tial quality of commanding exertion — The obligation of debt — Other obligations— Land values most important of all forms of value from obligation — Property in land equivalent to property in men — Common meaning of value in exchange — Real relation with exertion— Ultimate exchangeability is for labor— Adam Smith right — Light thi'own by this theory of value o . . . 257 xviii GENEEAL CONTENTS.

Chapter XV. The Meaning Of Wealth In Political Economy

SHOWING HOW VALUE FROM PRODUCTION IS WEALTH IN POLITICAL ECONOMY.

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Wealth as fixed in "Progress and Poverty" — Course of the scholastic political economy — The reverse method of this work — The conclusion the same — Reason of the disposition to include all value as wealth — Metaphorical meanings — Bull and pun — Metaphorical meaning of wealth — Its core meaning — Its use to express exchangeability — Similar use of money — Ordinary core meaning the proper meaning of wealth — Its use in individual economy and in political economy — What is meant by increase of wealth — Wealth and labor — Its factors nature and man — Wealth their resultant — Of Adam Smith — Danger of carrying into political economy a meaning proper in individual economy — Example of " money " — " Actual wealth " and "relative wealth" — "Value from production" and "value from obligation " — The English tongue has no single word for an article of wealth — Of "commodities" — Of "goods" — Why there is no singular in English — The attempt to form one by dropping the " s " and Anglo-German jargon .... 270

CHAPTER XVL THE GENESIS OF WEALTH.

SHOWING HOW WEALTH ORIGINATES AND WHAT IT ESSEN- TIALLY IS.

Reason of this inquiry — Wealth proceeds from exertion prompted by desire, but all exertion does not result in wealth — Simple examples of action, and of action resulting in wealth — "Riding and tying" — Sub-divisions of effort resulting in increments of wealth — Wealth essentially a stored and transferable service — Of transferable service — The action of reason as natural, though not as certain and quick as that of instinct — Wealth is service impressed on matter — Must be objective and have tangible form 285

Chapter XVII. The Wealth That Is Called Capital

SHOWING WHAT THE WEALTH CALLED CAPITAL REALLY IS.

Capital is a part of wealth used indirectly to satisfy desire — Simple illustration of fruit — Wealth permits storage of labor — The bull and the man — Exertion and its higher powers — Per-

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sonal qualities cannot really be wealth or capital — The taboo and its modern form — Common opinion of wealth and capital 293

Chapter XVIII. Why Political Economy Considers Only Wealth

SHOWING THAT POLITICAL ECONOMY, AS PROPERLY STATED, COVERS ALL THE RELATIONS OF MEN IN SOCIETY INTO WHICH IT IS NECESSARY TO INQUIRE.

Political economy does not include all the exertions for the satisfaction o* material desires ; but it does include the greater part of them, and it is through value that the exchange of services for services is made — Its duty and province . . 301

Chapter XIX. Moral Confusions As To Wealth

SHOWING HOW RICH AND POOR APE CORRELATIVES, AND WHY CHRIST SYMPATHIZED WITH THE POOR.

The legitimacy of wealth and the disposition to regard it as sordid and mean — The really rich and the really poor — They are really correlatives — The good sense of Christ's teaching . 304

Chapter XX. Of The Permanence Of Wealth

SHOWING THAT VALTJES PROM OBLIGATION SEEM REALLY TO LAST LONGER THAN VALUES FROM PRODUCTION.

Value from production and value from obligation — The one material and the other existing in the spiritual — Superior pei'maneuce of the spiritual — Shakespeare's boast — Mascenas's buildings and Horace's odes — The two values now existing — Franchises and land values last longer than gold and gems — Destruction in social advance — Conclusions from all this . 308

Chapter XXI. The Relation Of Money To Wealth

SHOWING THAT SOME MONEY IS AND SOME MONEY IS NOT WEALTH.

Where I shall treat of money — No categorical answer can yet be given to the question whether money is wealth — Some money is and some is not wealth 313

GENEEAL CONTENTS.

Chapter I. The Meaning Of Production

SHOWING THE MEANING AND PROPER USE OF PRODUCTION.

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Production a drawing forth of what before exists—Its difference from creation— Production other than of wealth— Includes all stages of bringing to be— Mistakes as to it . . . 323

Chapter II. The Three Modes Of Production

SHOWING THE COMMON CHARACTER, YET DIFFERENT MODES OF PRODUCTION.

Production involves change, brought about by conscious will — Its three modes : (1) adapting, (2) growing, (3) exchanging— This the natural order of these modes 327

Chapter III. Population And Subsistence

SHOWING THAT THE THEORY OF A TENDENCY IN POPULATION TO INCREASE FASTER THAN SUBSISTENCE HAS PREVIOUSLY BEEN EXAMINED AND CONDEMNED.

The Malthusian theory — Discussed in " Progress and Poverty" . 333

Chapter IV. The Alleged Law Of Diminishing Returns In Agriculture

SHOWING WHAT THIS ALLEGED LAW IS.

John Stuart Mill quoted as to the importance, relations and nature of this law — The reductio ad absurdum by which it is proved — Contention that it is a misapprehension of the universal law of space 335

GENERAL CONTENTS. xxi

Chapter V. Of Space And Time

SHOWING THAT HUMAN REASON IS ONE, AND SO FAB AS IT CAN GO MAY BE RELIED ON.

Purpose of this work — Of metaphysics — Danger of thinking of words as things — Space and time not conceptions of things, but of relations of things — They cannot, therefore, have independent beginning or ending — The verbal habit which favors this idea — How favored by poets and by religious teachers— How favored by philosophers — Of Kant — Of Schopenhauer — Mysteries and antinomies that are really confusions in the meaning of words — Human reason and the eternal reason — Philosophers who are really word-jugglers .... 339

Chapter VI. Confusion Of The Spacial Law With Agri- Culture

SHOWING THE GENESIS OF THIS CONFUSION.

What space is — The place to which man is confined — Extension a part of the concept, land — Perception is by contrast — Man's first use of land is by the mode of adapting — His second, and for a long time most important, use is by growing — The third, on which civilization is now entering, is exchanging — Political economy began in the second, and growing still attracts most attention — The truth and error of the Physiocrats — The successors of Smith, while avoiding the error of the Physiocrats, also ignored their truth ; and with their acceptance of the Malthusiau theory, and Ricardo's explanation of rent as relating to agricultural land, they fell into, and have continued the habit of treating land and rent as agricultural — Difficulty of the single tax in the United States 351

Chapter VII. The Relation Of Space In Production

SHOWING THAT SPACE HAS RELATION TO ALL MODES OF PRODUCTION.

Matter being material, space must have relation to all production — This relation readily seen in agriculture — The concentration of labor in agriculture tends up to a certain point to increase and then to diminish production — But it is a misapprehension to attribute this law to agriculture or to the mode of growing— It holds in all modes and sub-divisions of xii GENERAL CONTENTS.

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these modes — Instances : of the production of brick, of the mere storage of brick — Man himself requires space — The division of labor as requiring space — Intensive and extensive use of land 357

Chapter VIII. The Relation Of Time In Production

SHOWING THAT ALL MODES OF PRODUCTION HAVE RELATION TO TIME.

Difference between apprehensions of space and time, the one objective, the other subjective — Of spirits and of creation — All production requires time— The concentration of labor in time 365

Chapter IX. Cooperation — Its Two Ways

SHOWING THE TWO WAYS OF COOPERATION.

Cooperation is the union of individual powers in the attainment of common ends — Its ways and their analogues : (1) the combination of effort ; (2) the separation of effort — Illustrations : of building houses, of joint-stock companies, etc. — Of sailing a boat — The principle shown in naval architecture — The Erie Canal — The baking of bread — Production requires conscious thought — The same principle in mental effort — What is on the one side separation is on the other concentration — Extent of concentration and specialization of work in modern civilization — The principle of the machine — Beginning and increase of division of labor — Adam Smith's three heads — ^A better analysis 371

Chapter X. Cooperation — Its Two Kinds

SHOWING THE TWO KINDS OF COOPERATION, AND HOW THE POWER OF THE ONE GREATLY EXCEEDS THAT OF THE OTHER.

The kind of cooperation which, as to method of union or how of initiation, results from without and may be called directed or conscious cooperation — Another proceeding from within which may be called spontaneous or unconscious cooperation — Types of the two kinds and their analogues — Tacking of a full-rigged ship and of a bird — Intelligence that suffices for the one impossible for the other — The savage and the ship — Unconscious cooperation required in ship-building — Conscious cooperation will not suffice for the work of unconseioiis — The fatal defect of socialism — The reason of this is that the power of thought is spiritual and cannot be fused as can physical

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force — Of "man power "and "mind power" — Illustration from the optician — Impossibility of socialism — Society a Leviathan greater than that of Hobbes 382

Chapter XI. The Office Of Exchange In Production

SHOWING THAT IN MAN THE LACK OF INSTINCT IS SUPPLIED BY THE HIGHER QUALITY OF REASON, WHICH LEADS TO EX- CHANGE.

The cooperation of ants and bees is from within and not from without ; from instinct and not from direction — Man has little instinct ; but the want supplied by reason — Reason shows itself in exchange — This suffices for the unconscious cooperation of the economic body or Greater Leviathan — Of the three modes of production, exchanging is the highest — Mistake of writers on political economy — The motive of exchange . . 397

Chapter XII. Office Of Competition In Production

SHOWING THAT COMPETITION BRINGS TRADE, AND CONSE- QUENTLY SERVICE, TO ITS JUST LEVEL.

"Competition is the life of trade," an old and true adage — The assumption that it is an evil springs from two cfAises — one bad, the other good — The bad cause at the root of protectionism — Law of competition a natural law — Competition necessary to civilization 402

Chapter XIV. Order Of The Three Factors Of Production

SHOWING THE AGREEMENT OP ALL ECONOMISTS AS TO THE NAMES AND ORDER OF THE FACTORS OF PRODUCTION,