Please provide me with Plagiarism Report.Class reading and Chapters are attached belowIn Class, materials must be used only. No Outside source.QUESTION Write a 5-7 page paper (double spaced, 12 point

The V ic to ria n W orld a n d t h e U nderw orld o f

Eco n om ic s

K arl M arx p ro nounced h is s e n te n ce o f d oom o n c ap ita lis m i n t h e

Manife sto

o f

1 848; th e sy ste m w as d ia g nose d a s th e v ic tim o f a n in cu ra b le d is e ase , a n d

a lth ough n o tim eta b le w as g iv en , it w as p re su m ed to b e c lo se e n ough to its

f in al d eath s tr u ggle f o r t h e n ex t o f k in — th e C om munis ts — to l is te n a v id ly f o r

t h e la st g asp th at w ould sig nal th eir in herita n ce o f p ow er. E ven b efo re th e

a p peara n ce o f

Capita l

i n 1 867, t h e d eath w atc h h ad b eg un, a n d w ith e ach b out

o f s p ecu la tiv e fe v er o r e ach s ie g e o f in dustr ia l d ep re ssio n, th e h opefu l d re w

n eare r to th e death bed an d to ld each oth er th at th e m om en t of Fin al

R ev olu tio n w ould n ow b e s o on a t h an d.

But t h e s y ste m d id n ot d ie . T ru e, m an y o f t h e M arx is t l a w s o f m otio n w ere

v erif ie d b y th e m arc h o f e v en ts : b ig b usin ess d id g ro w b ig ger a n d re cu rre n t

d ep re ssio ns an d unem plo ym en t did pla g ue so cie ty . B ut alo ng w ith th ese

c o nfir m atio ns of th e pro gnosis of doom , an oth er hig hly im porta n t an d

p orte n to usly p hra se d M arx is t sy m pto m w as re m ark ab le b y its a b se n ce: th e

“ in cre asin g m is e ry ” o f t h e p ro le ta ria t f a ile d t o i n cre ase .

Actu ally , th ere h as b een a lo ng d eb ate a m ong M arx is ts a s to w hat M arx

m ean t b y th at p hra se . If h e m ean t o nly th at m ore a n d m ore o f th e w ork in g

c la ss would ex perie n ce th e “m is e ry ” of beco m in g pro le ta ria n s— wag e

w ork ers — he w as

rig ht, a s w e h av e s e en . B ut if h e m ean t th at th eir p hysic al

m is e ry w ould w ors e n , h e w as w ro ng.

In deed , a R oyal C om mis sio n c o nven ed to lo ok in to th e slu m p o f 1 886

e x pre sse d p artic u la r sa tis fa ctio n w ith th e c o nditio n o f th e w ork in g c la sse s.

A nd t h is w as n ot j u st t h e p atr o niz in g c an t o f c la ss a p olo gis ts . C onditio ns

were

b ette r— perc ep tib ly an d sig nif ic an tly b ette r. L ookin g b ack o n th e situ atio n

f ro m th e 1 880s, S ir R obert G if f e n w ro te : “ W hat w e h av e to c o nsid er is th at

f if ty y ears a g o, t h e w ork in g m an w ith w ag es o n t h e a v era g e a b out h alf , o r n ot

m uch m ore th an h alf w hat th ey are n ow , h ad at tim es to co nte n d w ith a

f lu ctu atio n in th e p ric e o f b re ad w hic h im plie d sh eer sta rv atio n. P erio dic

s ta rv atio n w as, in fa ct, th e co nditio n of th e m asse s of w ork in g m en

t h ro ughout th e kin gdom fif ty years ag o.” B ut by th e tim e G if f e n w ro te , alth ough pric es had ris e n , w ag es had ris e n fa ste r.

For th e fir st tim e

, th e

Englis h w ork in g-m an w as m ak in g e n ough to k eep b ody a n d s o ul to geth er— a

so rry c o m men ta ry o n t h e p ast, b ut a h opefu l a u gury f o r t h e f u tu re .

And n ot o nly h ad w ag es g one u p, b ut th e v ery s o urc e o f s u rp lu s v alu e h ad

dim in is h ed : h ours w ere fa r sh orte r. A t th e Ja rro w S hip yard s a n d th e N ew

Castle C hem ic al W ork s, fo r e x am ple , th e w ork w eek h ad fa lle n fro m s ix ty -

one to fif ty -fo ur h ours , w hile e v en in th e s w eate d te x tile m ills , th e s tin t w as

re d uced to o nly fif ty -s e v en h ours . In deed th e m ill o w ners c o m pla in ed th at

th eir w ag e c o sts h ad r is e n b y b ette r th an 2 0 p erc en t. B ut w hile p ro gre ss w as

ex pen siv e, it p aid in ta n gib le d iv id en ds. F or as co nditio ns am elio ra te d , th e

mutte rin gs o f 1 848 d ie d d ow n. “ Y ou c an not g et th em to ta lk o f p olitic s so

lo ng a s t h ey a re w ell e m plo yed ,” t e stif ie d a S ta ff o rd sh ir e m an ufa ctu re r o n t h e

attitu de o f h is w ork in g f o rc e.

Even M arx a n d E ngels h ad t o r e co gniz e t h e t r e n d. “ T he E nglis h p ro le ta ria t

is a ctu ally b eco m in g m ore a n d m ore b ourg eo is ,” m ourn ed E ngels i n a l e tte r t o

Marx , “ so th at th e u ltim ate a im o f th is m ost b ourg eo is o f a ll n atio ns w ould

ap pear to be th e posse ssio n,

alo ngsid e

th e bourg eo is , of a bourg eo is

aris to cra cy a n d a b ourg eo is p ro le ta ria t.”

Cle arly , M arx w as p re m atu re in h is e x pecta tio n o f im pen din g d oom . F or

th e f a ith fu l, o f c o urs e , th e d is c o ncertin g

tu rn o f e v en ts c o uld b e s w allo w ed in

th e c o m fo rtin g k now le d ge th at “ in ev ita b le ” s till m ean t in ev ita b le , a n d th at a

matte r o f a g en era tio n o r tw o c am e to little in th e g ra n d m arc h o f h is to ry . B ut

fo r th e n on-M arx is t s u rv ey ors o f th e s c en e, th e g re at V ic to ria n b oom m ean t

so m eth in g e ls e . T he w orld m ore a n d m ore a p peare d f u ll o f h ope a n d p ro m is e ,

an d th e f o re b odin gs o f a d is se n te r lik e K arl M arx s e em ed m ere ly th e r a v in gs

of a d is c o nte n te d ra d ic al. H en ce th e in te lle ctu al b om bsh ell th at M arx h ad

pre p are d w en t o ff in a lm ost to ta l s ile n ce; in ste ad o f a s to rm o f a b use , M arx

met t h e f a r m ore c ru sh in g i g nom in y o f i n dif f e re n ce.

For e co nom ic s h ad c ease d to b e th e p ro lif e ra tio n o f w orld v ie w s th at, in

th e h an ds o f n ow a p hilo so pher, n ow a f in an cia l tr a d er, n ow a r e v olu tio nary ,

se em ed to illu m in ate th e w hole a v en ue d ow n w hic h s o cie ty w as m arc h in g. I t

becam e i n ste ad t h e s p ecia l p ro vin ce o f p ro fe sso rs , w hose i n vestig atio ns t h re w

out p in poin t b eam s ra th er th an th e w id e-s e arc h in g b eaco ns o f th e earlie r

eco nom is ts .

There w as a r e aso n f o r t h is : a s w e h av e s e en , V ic to ria n E ngla n d h ad c au ght

th e ste ad y tr a d e w in ds of la te -n in ete en th -c en tu ry pro gre ss an d optim is m .

Im pro vem en t w as in th e a ir , a n d s o q uite n atu ra lly th ere s e em ed le ss c au se to

ask d is tu rb in g q uestio ns a b out th e n atu re o f th e v oyag e. H en ce th e V ic to ria n

boom gav e ris e to a ro ste r of elu cid ato rs , m en w ho w ould ex am in e th e

work in gs o f th e s y ste m in g re at d eta il, b ut n ot m en w ho w ould e x pre ss d oubt as to its b asic m erits o r m ak e tr o uble so m e p ro gnostic atio ns a s to its e v en tu al

fa te . A n ew p ro fe sso rd om to ok o ver th e m ain lif e o f e co nom ic th ought. Its

co ntr ib utio ns w ere o fte n i m porta n t, y et n ot v ita l. F or i n t h e m in ds o f m en l ik e

Alf re d M ars h all, S ta n le y Je v ons, Jo hn B ate s C la rk , an d th e pro lif e ra tin g

fa cu ltie s th at s u rro unded th em , th ere w ere n o w olv es in th e e co nom ic w orld

an ym ore , a n d th ere fo re n o lif e -a n d-d eath a ctiv itie s fo r e co nom ic th eo ry to

elu cid ate . T he w orld w as p eo ple d e n tir e ly w ith a g re eab le , i f i m ag in ary , s h eep .

The sh eep w ere nev er m ore cle arly delin eate d th an in a little volu m e

en title d

Math em atic a l P sy ch ic s

, w hic h ap peare d in 1881, ju st tw o years

befo re M arx d ie d . It w as n ot

writte n b y th e g re ate st o f a cad em ic ia n s, b ut

perh ap s by th e m ost re v ealin g of th em — a str a n ge, sh y pro fe sso r nam ed

Fra n cis Y sid ro E dgew orth , a n ep hew o f t h at M aria E dge-w orth w ho h ad o nce

pla y ed c h ara d es w ith R ic ard o.

Edgew orth w as u ndoubte d ly a b rillia n t s c h ola r. I n h is f in al e x am in atio ns a t

Oxfo rd , w hen h e w as a sk ed a p artic u la rly a b str u se q uestio n, h e i n quir e d o f h is

ex am in ers , “ S hall I a n sw er b rie fly , o r a t le n gth ?” a n d th en p ro ceed ed to h old

fo rth f o r h alf a n h our, p unctu atin g h is r e p ly w ith e x cu rs io ns in to G re ek w hile

his e x am in ers g ap ed .

But E dgew orth w as n ot fa sc in ate d w ith e co nom ic s b ecau se it ju stif ie d o r

ex pla in ed o r c o ndem ned th e w orld , o r b ecau se it o pen ed n ew v is ta s, b rig ht o r

glo om y, i n to t h e f u tu re . T his o dd s o ul w as f a sc in ate d b ecau se e co nom ic s d ealt

with

quantitie s

an d becau se an yth in g th at dealt w ith quan titie s co uld be

tr a n sla te d in to

math em atic s!

The pro cess of tr a n sla tio n re q uir e d th e

ab an donm en t o f th at te n sio n-fra u ght w orld o f th e e arlie r e co nom is ts , b ut it

yie ld ed in r e tu rn a w orld o f s u ch n eat p re cis io n a n d lo vely e x actn ess th at th e

lo ss s e em ed a m ply c o m pen sa te d .

To b uild u p s u ch a m ath em atic al m ir ro r o f r e ality , t h e w orld o bvio usly h ad

to b e s im plif ie d . E dgew orth ’s s im plif ic atio n w as th is a ssu m ptio n:

every m an

is a p le a su re m ach in e

. J e re m y B en th am h ad o rig in ate d th e c o ncep tio n in th e

early n in ete en th c en tu ry u nder th e b eg uilin g title o f th e F elic if ic C alc u lu s, a

philo so phic al v ie w o f h um an ity a s s o m an y liv in g p ro fit- a n d-lo ss c alc u la to rs ,

each b usily a rra n gin g h is lif e to m ax im iz e th e p le asu re o f h is p sy ch ic a d din g

mach in e. T o th is g en era l p hilo so phy E dgew orth n ow a d ded th e p re cis io n o f

math em atic s t o p ro duce a k in d o f P an glo ssia n B est o f A ll P ossib le W orld s.

Of a ll m en to h av e a d opte d s u ch a v ie w o f s o cie ty , E dge-w orth s e em s a

most u nlik ely c h oic e. H e h im se lf w as a s i ll- c o nstr u cte d a p le asu re m ach in e a s

can b e im ag in ed . N eu ro tic ally sh y, h e te n ded to fle e fro m th e p le asu re s o f

hum an co m pan y to th e p riv acy o f h is clu b; u nhap py ab out th e b urd en o f

mate ria l th in gs, h e re ceiv ed fe w o f th e p le asu re s th at fo r m ost p eo ple flo w

fro m p osse ssio ns. H is r o om s w ere b are , h is l ib ra ry w as t h e p ublic o ne, a n d h is sto ck of m ate ria l

wealth did not in clu de cro ck ery , or sta tio nery , or ev en

sta m ps. P erh ap s h is g re ate st s o urc e o f p le asu re w as in th e c o nstr u ctio n o f h is

lo vely i m ag in ary e co nom ic X an ad u.

But re g ard le ss o f h is m otiv es, E dgew orth ’s p le asu re -m ach in e a ssu m ptio n

bore w onderfu l i n te lle ctu al f ru it. F or i f e co nom ic s w as d efin ed t o b e t h e s tu dy

of h um an p le asu re -m ech an is m s co m petin g fo r sh are s o f so cie ty ’s sto ck o f

ple asu re , th en it c o uld b e s h ow n— with a ll th e ir re fu ta b ility o f th e d if f e re n tia l

calc u lu s— th at i n a w orld o f p erfe ct c o m petitio n e ach p le asu re m ach in e w ould

ach ie v e t h e h ig hest a m ount o f p le asu re t h at c o uld b e m ete d o ut b y s o cie ty .

In o th er w ord s, if th is w as n ot y et

quite

th e b est o f a ll p ossib le w orld s, it

co uld b e. U nfo rtu nate ly , th e w orld w as n ot o rg an iz ed a s a g am e o f p erfe ct

co m petitio n; m en d id h av e t h e l a m en ta b le h ab it o f s tic k in g t o geth er i n f o olis h

dis re g ard o f th e b en efic en t c o nse q uen ces o f s tu bborn ly fo llo w in g th eir s e lf -

in te re st; tr a d e unio ns, fo r ex am ple , w ere in dir e ct co ntr o vers io n to th e

prin cip le o f e ach f o r h im se lf , a n d t h e u nden ia b le f a ct o f i n eq ualitie s o f w ealth

an d p ositio n d id m ak e th e s ta rtin g p ositio n o f th e g am e s o m eth in g le ss th an

ab so lu te ly n eu tr a l.

But n ev er m in d, s a id E dgew orth . N atu re h as ta k en c are o f th at to o. W hile

tr a d e u nio ns m ig ht g ain in th e sh ort ru n th ro ugh c o m bin atio n, it c o uld b e

sh ow n th at in th e lo ng ru n th ey m ust lo se — th ey w ere only a tr a n sie n t

im perfe ctio n in th e id eal s c h em e o f th in gs. A nd if h ig h b ir th a n d g re at w ealth

se em ed a t f ir s t to p re ju dic e th e o utc o m e o f th e e co nom ic g am e, th at c o uld b e

re co ncile d w ith m ath em atic al p sy ch ic s, to o. F or w hile a ll in div id uals w ere

ple asu re m ach in es, s o m e w ere

bette r

p le asu re m ach in es th an o th ers . M en , f o r

ex am ple , w ere b ette r e q uip ped to ru n u p th eir p sy ch ic b an k a cco unts th an

wom en , a n d th e d elic ate s e n sib ilitie s o f th e “ aris to cra cy o f s k ill a n d ta le n t”

were m ore re sp onsiv e to th e ple asu re s of good liv in g th an th e clo dlik e

ple asu re m ach in es o f th e la b orin g cla sse s. H en ce, th e calc u lu s o f h um an

math em atic s c o uld s till f u nctio n a d van ta g eo usly ; in deed it p ositiv ely ju stif ie d

th ose d iv is io ns o f s e x a n d s ta tu s w hic h o ne s a w a b out h im i n t h e l iv in g w orld .

But m ath em atic al psy ch ic s did m ore th an ra tio naliz e th e

te n ets of

co nse rv atis m . E dgew orth actu ally belie v ed th at his alg eb ra ic in sig ht in to

hum an a ctiv ity m ig ht y ie ld h elp fu l r e su lts i n t h e w orld o f f le sh a n d b lo od. H is

an aly sis i n volv ed s u ch t e rm s a s t h ese :

“C onsid era tio ns so ab str a ct,” w ro te E dgew orth , “it w ould o f co urs e b e

rid ic u lo us to flin g u pon th e flo odtid e o f p ra ctic al p olitic s. B ut th ey a re n ot

perh ap s o ut o f p la ce w hen w e re m ount to th e little rills o f se n tim en t an d se cre t s p rin gs o f m otiv e w here e v ery c o urs e o f a ctio n m ust b e o rig in ate d .”

“T he little rills o f se n tim en t,” in deed ! W hat w ould A dam S m ith h av e

th ought o f th is c o nvers io n o f h is p ush y m erc h an ts , h is g re ed y jo urn ey m en ,

an d his m ultip ly in g la b orin g cla sse s in to so m an y cate g orie s of delic ate

ple asu re -s e ek ers ? In fa ct, H en ry S id gw ic k , a c o nte m pora ry o f E dgew orth ’s

an d a d is c ip le o f J. S . M ill, an grily an nounced th at h e ate h is d in ner n ot

becau se h e h ad to te d u p th e s a tis fa ctio ns to b e g ain ed th ere fro m , b ut b ecau se

he w as h ungry . B ut th ere w as n o u se p ro te stin g: th e s c h em e o f m ath em atic al

psy ch ic s w as so neat, so beg uilin g, so bere ft of tr o uble so m e hum an

in tr a n sig en ces, a n d so h ap pily u nbesm ir c h ed w ith c o nsid era tio ns o f h um an

str iv in g a n d s o cia l c o nflic t, t h at i ts s u ccess w as i m med ia te .

Edgew orth ’s w as not th e only su ch atte m pt to deh um an iz e politic al

eco nom y. E ven durin g M arx ’s lif e tim e a w hole m ath em atic al sc h ool of

eco nom ic s h ad g ro w n u p. I n G erm an y a n e co nom is t n am ed v on T hünen c am e

up w ith a f o rm ula t h at y ie ld ed , h e c la im ed , t h e p re cis e j u st w ag e o f l a b or:

Von T hünen l ik ed it w ell e n ough t o h av e i t e n gra v ed o n h is t o m bsto ne; w e

do n ot k now w hat th e w ork in gm en th ought o f it. In F ra n ce a d is tin guis h ed

eco nom is t n am ed L eo n W alr a s p ro ved th at o ne c o uld d ed uce b y m ath em atic s

th e e x act p ric es t h at w ould j u st e x actly c le ar t h e m ark et; o f

co urs e , i n o rd er t o

do th is , o ne h ad to h av e th e e q uatio n f o r e v ery s in gle e co nom ic g ood o n th e

mark et an d th en th e ab ility to so lv e a pro ble m in w hic h th e num ber of

eq uatio ns w ould ru n in to th e hundre d s of th ousa n ds— in deed , in to th e

millio ns. B ut n ev er m in d th e d if f ic u ltie s; th eo re tic ally th e p ro ble m c o uld b e

done. A t th e U niv ers ity o f M an ch este r, a p ro fe sso r n am ed W . S ta n le y J e v ons

wro te a tr e atis e o n p olitic al e co nom y in w hic h th e s tr u ggle f o r e x is te n ce w as

re d uced t o “ a C alc u lu s o f P le asu re a n d P ain .” “ M y t h eo ry o f E co nom ic s … i s

pure ly m ath em atic al in c h ara cte r,” w ro te Je v ons, a n d h e tu rn ed o ut o f h is

fo cu s e v ery a sp ect o f e co nom ic lif e w hic h w as n ot re d ucib le to th e jig sa w

pre cis io n o f h is s c h em e. P erh ap s e v en m ore n ote w orth y, h e p la n ned to w rite

(a lth ough h e d id n ot l iv e t o d o s o ) a b ook c alle d

Prin cip le s o f E co nom ic s:

i t i s

sig nif ic an t th at politic al eco nom y w as now calle d eco nom ic s, an d its

ex positio ns w ere b eco m in g t e x ts .

It w as n ot a ll fo olis h ness, a lth ough to o m uch o f it w as. E co nom ic s, a fte r

all, d oes c o ncern th e a ctio ns o f a g gre g ate s o f p eo ple , a n d h um an a g gre g ate s,

lik e a g gre g ate s o f a to m s, d o t e n d t o d is p la y s ta tis tic al r e g ula ritie s a n d l a w s o f

pro bab ility . T hus, a s th e p ro fe sso ria t tu rn ed its e y es to th e e x plo ra tio n o f th e

id ea o f

eq uilib riu m

—th e sta te to w ard w hic h th e m ark et w ould te n d a s th e

re su lt o f th e ra n dom c o llis io ns o f in div id uals a ll se ek in g to m ax im iz e th eir

utilitie s— it d id in fa ct e lu cid ate s o m e te n den cie s o f th e s o cia l u niv ers e . T he eq uatio ns o f L eo n W alr a s a re still u se d to d ep ic t th e a ttr ib ute s o f a so cia l

sy ste m a t r e st.

The q uestio n is , d oes a s y ste m “ at re st” a ctu ally d ep ic t th e re alitie s— th e

fu ndam en ta l re alitie s— of th e so cia l u niv ers e ? T he e arlie r e co nom is ts , fro m

Sm ith th ro ugh M ill an d o f co urs e M arx , h ad a co m pellin g im ag e in th eir

min ds o f a s o cie ty th at w as b y its n atu re

exp ansiv e

. T ru e, its e x pan sio n m ig ht

en co unte r b arrie rs , o r m ig ht r u n o ut o f s te am , o r m ig ht d ev elo p i n to e co nom ic

dow ntu rn s, but th e cen tr a l fo rc e of th e eco nom ic w orld w as noneth ele ss

in se p ara b le f ro m a p olitic al a n d p sy ch olo gic al t e n den cy t o w ard g ro w th .

It w as th is b asic c o ncep tio n th at w as la ck in g in th e n ew c o ncen tr a tio n o n

eq uilib riu m as th e m ost in te re stin g, m ost

re v ealin g asp ect of th e sy ste m .

Sudden ly c ap ita lis m w as n o lo nger se en a s a n h is to ric so cia l v eh ic le u nder

co nsta n t te n sio n b ut a s a s ta tic , r a th er h is to ry le ss, m ode o f o rg an iz atio n. T he

driv in g p ro puls io n o f th e sy ste m — th e p ro puls io n th at h ad fa sc in ate d a ll its

prio r in vestig ato rs — was now overlo oked , ig nore d , fo rg otte n . W hate v er

asp ects o f a c ap ita lis t e co nom y w ere illu m in ed in th e n ew p ers p ectiv e, its

his to ric m is sio n w as n ot.

And s o , a s a c o unte rp art to th is p ale w orld o f e q uatio ns, a n u nderw orld o f

eco nom ic s flo uris h ed . T here h ad a lw ay s b een s u ch a n u nderw orld , a s tr a n ge

lim bo o f c ra n ks a n d h ere tic s, w hose d octr in es h ad f a ile d to a tta in th e s ta tu re

of re sp ecta b ility . O ne su ch w as th e ir re p re ssib le B ern ard M an dev ille , w ho

sh ock ed th e e ig hte en th c en tu ry w ith a w itty d em onstr a tio n th at v ir tu e w as

vic e an d vic e vir tu e. M an dev ille m ere ly poin te d out th at th e pro flig ate

ex pen ditu re o f t h e s in fu l r ic h g av e w ork t o t h e p oor, w hile t h e s tin gy r e ctitu de

of th e vir tu ous pen ny pin ch er did not; hen ce, sa id M an dev ille , priv ate

im mora lity m ay re d ound to th e p ublic w elf a re , w here as p riv ate u prig htn ess

may b e a s o cia l b urd en . T he s o phis tic ate d l e sso n o f h is

Fable o f th e B ees

w as

to o m uch fo r th e eig hte en th cen tu ry to sw allo w ; M an dev ille ’s book w as

co nvic te d a s a p ublic n uis a n ce b y a g ra n d ju ry in M id dle se x in 1 723, a n d

Man dev ille h im se lf w as ro undly castig ate d b y A dam S m ith an d ev ery one

els e .

But w here as th e e arlie r e ccen tr ic s a n d c h arla ta n s w ere la rg ely b an is h ed b y

th e o pin io ns o f stu rd y th in kers lik e S m ith o r R ic ard o, n ow th e u nderw orld

cla im ed its re cru its fo r a d if f e re n t re aso n. T here w as sim ply n o lo nger a n y

ro om in th e o ff ic ia l w orld o f e co nom ic s fo r th ose w ho w an te d to ta k e th e

whole g am ut o f h um an b eh av io r f o r t h eir f o ru m , a n d t h ere w as l ittle t o le ra n ce

in th e stu ff y w orld o f V ic to ria n co rre ctn ess fo r th ose w hose d ia g nosis o f

so cie ty le ft ro om fo r m ora l d oubtin gs o r se em ed to in dic ate th e n eed fo r

ra d ic al r e fo rm .

And so th e u nderw orld to ok o n n ew lif e . M arx w en t th ere b ecau se h is doctr in e w as u nple asa n t. M alth us w en t th ere b ecau se h is id ea o f “g en era l

glu ts ” w as a n a rith m etic al

ab su rd ity a n d b ecau se h is d oubts a b out t h e b en efits

of s a v in g w ere t o ta lly a t v aria n ce w ith t h e V ic to ria n a d m ir a tio n f o r t h rif t. T he

Uto pia n s w en t th ere becau se w hat th ey w ere ta lk in g ab out w as arra n t

nonse n se an d w asn ’t “eco nom ic s” an yw ay, an d fin ally an yone w en t th ere

whose d octr in es f a ile d to a cco rd w ith th e e le g an t w orld th at th e a cad em ic ia n s

ere cte d i n t h eir c la ssro om s a n d f o ndly b elie v ed e x is te d o uts id e t h em .

It w as a f a r m ore i n te re stin g p la ce, t h is u nderw orld , t h an t h e s e re n e r e alm s

ab ove. It a b ounded w ith w onderfu l p ers o nalitie s, a n d in it s p ro ute d a w eir d

an d lu xuria n t ta n gle o f id eas. T here w as, fo r e x am ple , a m an w ho h as b een

alm ost fo rg otte n in th e m arc h o f e co nom ic id eas. H e is F re d eric B astia t, a n

eccen tr ic F re n ch m an , w ho liv ed fro m 1 801 to 1 850, a n d w ho in th at sh ort

sp ace o f t im e a n d a n e v en s h orte r s p ace o f l ite ra ry l if e — six y ears — bro ught t o

bear o n e co nom ic s t h at m ost d ev asta tin g o f a ll w eap ons: r id ic u le . L ook a t t h is

mad house o f a w orld , sa y s B astia t. It g oes to en orm ous eff o rts to tu nnel

undern eath a m ounta in i n o rd er t o c o nnect t w o c o untr ie s. A nd t h en w hat d oes

it d o? H av in g l a b ore d m ig htily t o f a cilita te t h e i n te rc h an ge o f g oods, i t s e ts u p

cu sto m s g uard s o n b oth sid es o f th e m ounta in a n d m ak es it a s d if f ic u lt a s

possib le f o r m erc h an dis e t o t r a v el t h ro ugh t h e t u nnel!

Bastia t h ad a g if t fo r p oin tin g o ut a b su rd itie s; h is little b ook

Eco nom ic

Sophis m s

is as clo se to hum or as eco nom ic s has ev er co m e. W hen , fo r

ex am ple , th e Paris -M ad rid ra ilr o ad w as bein g deb ate d in th e Fre n ch

Asse m bly , o ne M . S im io t arg ued th at it sh ould h av e a g ap at B ord eau x,

becau se a b re ak in th e lin e th ere w ould re d ound g re atly to th e w ealth o f th e

Bord eau x p orte rs , c o m mis sio nair e s, h ote lk eep ers , b arg em en , a n d t h e l ik e, a n d

th us, b y e n ric h in g B ord eau x, w ould e n ric h F ra n ce. B astia t s e iz ed o n th e id ea

with a v id ity . F in e, h e s a id , b ut le t’s n ot s to p a t B ord eau x a lo ne. “ If B ord eau x

has a r ig ht to p ro fit b y a g ap … th an A ngoulê m e, P oitie rs , T ours , O rlé an s …

sh ould a ls o d em an d g ap s a s b ein g fo r th e g en era l in te re st… . In th is w ay w e

sh all s u cceed in h av in g a ra ilw ay c o m pose d o f s u ccessiv e g ap s, a n d w hic h

may b e d en om in ate d a

Neg ativ e R ailw ay.”

Bastia t w as a w it i n t h e w orld o f e co nom ic s, b ut h is p riv ate

lif e w as t r a g ic .

Born in B ay onne, h e w as o rp han ed a t a n e arly a g e a n d, w ors e y et, c o ntr a cte d

tu berc u lo sis . H e s tu die d a t a u niv ers ity , a n d t h en t r ie d b usin ess, b ut h e h ad n o

head fo r c o m merc ia l d eta ils . H e tu rn ed to a g ric u ltu re , b ut h e fa re d e q ually

bad ly th ere ; lik e T ols to i’s w ell- m ean in g c o unt, th e m ore h e in te rfe re d in th e

ru nnin g o f h is f a m ily e sta te , th e w ors e it d id . H e d re am ed o f h ero is m , b ut h is

milita ry a d ven tu re s h ad a D on Q uix ote tw is t: w hen th e B ourb ons w ere ru n

out o f F ra n ce in 1 830, B astia t ro unded u p six h undre d y oung m en a n d le d

th em to s to rm a r o yalis t c ita d el, r e g ard le ss o f c o st. P oor B astia t— th e f o rtr e ss meek ly h au le d d ow n i ts f la g a n d i n vite d e v ery one i n f o r a f e ast i n ste ad .

It s e em ed t h at h e w as d oom ed t o d is a p poin tm en t. B ut h is e n fo rc ed i d le n ess

tu rn ed h is in te re sts to e co nom ic s, a n d h e b eg an to r e ad a n d d is c u ss th e to pic s

of th e d ay. A n eig hborin g c o untr y g en tle m an u rg ed h im to p ut h is id eas o n

pap er, a n d B astia t w ro te a n a rtic le o n fre e tr a d e a n d s e n t it in to a P aris ia n

jo urn al. H is th oughts w ere orig in al an d his sty le w onderfu lly sh arp . T he

artic le w as p rin te d , an d o vern ig ht th is m ild sc h ola r o f th e p ro vin ces w as

fa m ous.

He cam e to P aris . “H e h ad n ot h ad tim e to call in th e assis ta n ce o f a

Paris ia n h atte r a n d ta ilo r,” w rite s M . d e M olin ari, “ an d w ith h is lo ng h air , h is

tin y h at, h is a m ple fro ck co at a n d h is fa m ily u m bre lla , y ou w ould h av e b een

ap t to m is ta k e h im f o r a n h onest p easa n t w ho c am e to to w n f o r th e f ir s t tim e

to s e e t h e m etr o polis .”

But th e c o untr y sc h ola r h ad a p en th at b it. E very d ay h e re ad th e P aris

pap ers i n w hic h t h e d ep utie s a n d m in is te rs o f F ra n ce a rg ued f o r a n d d efe n ded

th eir p olic ie s o f s e lf is h ness a n d b lin d s e lf -in te re st; t h en h e w ould a n sw er w ith

a re jo in der th at ro ck ed P aris w ith la u ghte r. F or e x am ple , w hen th e C ham ber

of D ep utie s i n th e 1 840s le g is la te d h ig her d utie s o n a ll f o re ig n g oods i n o rd er

to b en efit F re n ch in dustr y , B astia t tu rn ed o ut th is m aste rp ie ce o f e co nom ic

sa tir e :

PE TIT IO N O F T H E M ANUFA CTU RER S O F C A NDLES, W AXLIG HTS,

LA M PS, CA NDLEST IC K S, ST R EET LA M PS, SN UFFE R S,

EX TIN GUIS H ER S, A ND O F TH E PR O DUCER S O F O IL , TA LLO W ,

RESIN , A LC O HOL, A ND G EN ER A LLY E V ER Y TH IN G C O NNEC TED

WIT H L IG HTIN G

T O M

ESSIE U RS T H E

M

EM BER S O F T H E

C

HAM BER O F

D

EPU TIE S

G EN TLEM EN

,

… W e are su ff e rin g fro m th e in to le ra b le co m petitio n of a fo re ig n riv al,

pla ced , it w ould se em , in a co nditio n so fa r su perio r to o ur o w n fo r th e

pro ductio n o f l ig ht, t h at h e a b so lu te ly

in undate s

o ur

natio nal m ark et

w ith it a t

a p ric e f a b ulo usly r e d uced … . T his r iv al … i s n o o th er t h an t h e s u n.

What w e p ra y fo r, is , th at it m ay p le ase y ou to p ass a la w o rd erin g th e

sh uttin g u p o f a ll w in dow s, sk ylig hts , d orm er- w in dow s, o uts id e a n d in sid e

sh utte rs , c u rta in s, b lin ds, b ull’s -e y es; in a w ord o f a ll o pen in gs, h ole s, c h in ks,

an d f is su re s.

… I f y ou s h ut u p a s m uch a s p ossib le a ll a ccess to n atu ra l lig ht a n d c re ate a

dem an d f o r a rtif ic ia l l ig ht, w hic h o f o ur F re n ch m an ufa ctu re rs w ill n ot b en efit

by i t? … I f m ore ta llo w is c o nsu m ed , th en th ere m ust b e m ore o xen a n d s h eep … if

more o il is c o nsu m ed , th en w e s h all h av e e x te n ded c u ltiv atio n o f th e p oppy,

of t h e o liv e … o ur h eath s w ill b e c o vere d w ith r e sin ous t r e es.

Mak e y our c h oic e, b ut b e lo gic al; f o r a s lo ng a s y ou e x clu de, a s y ou d o, ir o n,

co rn , f o re ig n f a b ric s,

in p ro portio n

a s th eir p ric es a p pro xim ate to z ero , w hat

in co nsis te n cy it w ould b e to a d m it th e lig ht o f th e s u n, th e p ric e o f w hic h is

alr e ad y a t

ze ro

d urin g t h e e n tir e d ay !

A m ore dra m atic — if fa n ta stic — defe n se of fre e tr a d e has nev er been

writte n . B ut it w as n ot o nly a g ain st p ro te ctiv e ta rif f s th at B astia t p ro te ste d :

th is m an la u ghed a t e v ery f o rm o f e co nom ic d ouble -th in kin g. I n 1 848, w hen

th e S ocia lis ts b eg an to p ro pound th eir id eas f o r th e s a lv atio n o f s o cie ty w ith

more re g ard fo r p assio n th an p ra ctic ab ility , B astia t

tu rn ed a g ain st th em th e

sa m e w eap ons th at h e h ad u se d a g ain st th e

ancie n r é g im e

. “ E very one w an ts

to liv e a t th e e x pen se o f th e s ta te ,” h e w ro te . “ T hey f o rg et th at th e s ta te liv es

at t h e e x pen se o f e v ery one.”

But h is s p ecia l ta rg et, h is m ost h ate d “ so phis m ,” w as th e r a tio naliz atio n o f

priv ate g re ed u nder th e p re te n tio us c o ver o f a p ro te ctiv e ta rif f e re cte d f o r th e

“n atio nal g ood.” H ow h e lo ved to d em olis h th e s p ecio us th in kin g th at a rg ued

fo r b arrie rs to tr a d e u nder th e g uis e o f lib era l e co nom ic s! W hen th e F re n ch

min is tr y p ro pose d to r a is e th e d uty o n im porte d c lo th to “ p ro te ct” th e F re n ch

work in gm an , B astia t r e p lie d w ith t h is d elic io us p ara d ox:

“P ass a l a w t o t h is e ff e ct,” w ro te B astia t t o t h e M in is te r o f C om merc e. “ N o

one s h all h en cefo rth b e p erm itte d to e m plo y a n y b eam s o r r a fte rs b ut s u ch a s

are p ro duced a n d f a sh io ned b y b lu nt h atc h ets … . W here as a t p re se n t w e g iv e a

hundre d b lo w s o f th e a x e, w e s h all th en g iv e th re e h undre d . T he w ork w hic h

we now do in an hour w ill th en re q uir e th re e hours . W hat a pow erfu l

en co ura g em en t w ill th us b e g iv en to la b or! … W hoev er sh all h en cefo rth

desir e to h av e a r o of to c o ver h im m ust c o m ply w ith o ur e x actio ns, ju st a s a t

pre se n t w hoev er d esir e s c lo th es t o h is b ack m ust c o m ply w ith y ours .”

His c ritic is m s, fo r a ll th eir p en etr a tin g m ock ery , m et w ith little p ra ctic al

su ccess. H e w en t to E ngla n d to m eet th e le ad ers o f th e f re e-tr a d e m ovem en t

th ere a n d r e tu rn ed to o rg an iz e a f re e-tr a d e a sso cia tio n in P aris . I t la ste d o nly

eig hte en m onth s— Bastia t w as n ev er a n y g ood a s a n o rg an iz er.

But 1848 w as now at han d an d B astia t w as ele cte d to th e N atio nal

Asse m bly . B y th en th e d an ger s e em ed to h im th e o th er e x tr e m e— th at m en

would p ay to o m uch a tte n tio n to th e im perfe ctio ns o f th e s y ste m a n d w ould

blin dly ch oose so cia lis m in its ste ad . H e b eg an a b ook en title d

Eco nom ic

Harm onie s

in w hic h h e w as to s h ow th at th e a p pare n t d is o rd er o f th e w orld

was a d is o rd er o f t h e s u rfa ce o nly ; th at u ndern eath , th e i m petu s o f a t h ousa n d dif f e re n t se lf -s e ek in g ag en ts b ecam e tr a n sm ute d in th e m ark etp la ce in to a

hig her s o cia l g ood. B ut h is h ealth w as n ow d is a str o usly b ad . H e c o uld b are ly

bre ath e, a n d h is f a ce w as liv id w ith th e r a v ag es o f h is d is e ase . H e m oved to

Pis a , w here h e re ad in th e p ap ers o f h is

ow n d eath a n d o f th e c o m monpla ce

ex pre ssio ns o f r e g re t w hic h a cco m pan ie d i t: r e g re t a t t h e p assin g o f “ th e g re at

eco nom is t,” th e “ illu str io us a u th or.” H e w ro te a f rie n d: “ T han k G od I a m n ot

dead . I a ssu re y ou I s h ould b re ath e m y la st w ith out p ain a n d a lm ost w ith jo y

if I w ere c erta in o f le av in g to th e f rie n ds w ho lo ve m e, n ot p oig nan t r e g re ts ,

but a g en tle , a ff e ctio nate , so m ew hat m ela n ch oly re m em bra n ce o f m e.” H e

str u ggle d to f in is h h is b ook b efo re h e h im se lf s h ould b e f in is h ed . B ut it w as

to o la te . In 1 850 h e p asse d a w ay, w his p erin g a t th e e n d s o m eth in g th at th e

lis te n in g p rie st t h ought w as “ T ru th , t r u th … .”

He is a very sm all fig ure in th e eco nom ic co nste lla tio n. H e w as

en orm ously c o nse rv ativ e b ut n ot in flu en tia l, e v en a m ong c o nse rv ativ es. H is

fu nctio n, it s e em s, w as to p ric k th e p om positie s o f h is tim e; b ut b en eath th e

ra ille ry a n d th e w it lie s th e m ore d is tu rb in g q uestio n: d oes th e s y ste m a lw ay s

mak e s e n se ? A re th ere p ara d oxes w here th e p ublic a n d p riv ate w eals c o llid e?

Can w e tr u st th e a u to m atic m ech an is m o f p riv ate in te re st w hen it is p erv erte d

at e v ery tu rn b y th e f a r f ro m a u to m atic m ech an is m o f th e p olitic al s tr u ctu re it

ere cts ?

The q uestio ns w ere n ev er s q uare ly f a ced in th e E ly sia n f ie ld s a b ove. T he

off ic ia l w orld o f e co nom ic s t o ok l ittle n otic e o f t h e p ara d oxes p ro pose d b y i ts

je ste r. I n ste ad i t s a ile d s e re n ely o n t o w ard t h e d ev elo pm en t o f t h e q uan tita tiv e

nic etie s of a ple asu re -s e ek in g w orld , an d th e questio ns ra is e d by B astia t

re m ain ed u nan sw ere d . C erta in ly m ath em atic al p sy ch ic s w as h ard ly th e to ol

with w hic h to u nlo ck th e d ile m ma o f th e N eg ativ e R ailw ay a n d th e B lu nt

Hatc h et; S ta n le y Je v ons, w ho w ith E dgew orth w as th e g re at p ro ponen t o f

mak in g e co nom ic s a “ sc ie n ce,” a d m itte d , “ A bout p olitic s, I c o nfe ss m yse lf in

a f o g.” U nfo rtu nate ly , h e w as n ot a lo ne.

And so th e underw orld co ntin ued to pro sp er. In 1879 it gain ed an

Am eric an re cru it, a b eard ed , g en tle , fie rc ely se lf -s u re m an , w ho sa id th at

“P olitic al E co nom y… a s c u rre n tly ta u ght

is

h opele ss a n d d esp air in g. B ut th is

[is ] b ecau se s h e h as b een d eg ra d ed a n d s h ack le d ; h er tr u th s d is lo cate d ; h er

harm onie s ig nore d ; th e w ord s h e w ould u tte r g ag ged in h er m outh , a n d h er

pro te st a g ain st w ro ng tu rn ed in to a n in dors e m en t o f in ju stic e.” A nd th at w as

not a ll. F or th is h ere tic m ain ta in ed n ot o nly th at e co nom ic s h ad f a ile d to s e e

th e a n sw er to th e r id dle o f p overty a lth ough it w as c le arly la id o ut b efo re h er

ey es, b ut th at w ith h is re m ed y, a w hole n ew w orld sto od re ad y to u nfo ld :

“W ord s f a il th e th ought! I t is th e G old en A ge o f w hic h p oets h av e s u ng a n d

hig h-ra is e d se ers hav e to ld in m eta p hor! … It is th e cu lm in atio n of Chris tia n ity — th e c ity o f G od w ith i ts w alls o f j a sp er a n d i ts g ate s o f p earl! ”

The n ew co m er w as H en ry G eo rg e. N o w onder h e w as in th e u nderw orld ,

fo r h is e arly c are er m ust c erta in ly h av e se em ed a n u nco uth p re p ara tio n fo r

se rio us th in kin g to th e c lo is te re d k eep ers o f th e tr u e d octr in e. H en ry G eo rg e

had been ev ery th in g in lif e : ad ven tu re r, gold pro sp ecto r, w ork er, sa ilo r,

co m posito r, jo urn alis t, g overn m en t b ure au cra t, an d le ctu re r. H e h ad n ev er

ev en g one t o c o lle g e; a t t h ir te en h e h ad l e ft s c h ool t o s h ip o ut a s f o re m ast b oy

on th e 5 86-to n

Hin doo

b ound f o r A ustr a lia a n d C alc u tta . A t a tim e w hen h is

co nte m pora rie s w ere l e arn in g L atin , h e h ad b ought a p et m onkey a n d w atc h ed

a m an f a ll f ro m t h e r ig gin g, a n d b eco m e a t h in , i n te n se , i n dep en den t b oy w ith

a w an derlu st. B ack fro m th e E ast, h e tr ie d a jo b in a p rin tin g fir m in h is

hom eto w n o f P hila d elp hia , a n d th en a t n in ete en , s h ip ped o ut a g ain , th is tim e

to C alif o rn ia , w ith t h e t h ought o f g old i n m in d.

Befo re h e l e ft, h e r a te d h im se lf o n a p hre n olo gic al c h art:

Am ativ en ess… … … … … … … … … … . l a rg e

Philo pro gen itiv en ess… … … … … … … .m odera te

Adhesiv en ess… … … … … … … … … … .l a rg e

In hab itiv en ess… … … … … … … … … … l a rg e

Concen tr a tiv en ess… … … … … … … … … sm all

an d so on, w ith a ra tin g of “fu ll” on A lim en ta tiv en ess, “sm all” on

Acq uis itiv en ess, “ la rg e” o n S elf -e ste em , a n d “ sm all” o n M ir th fu ln ess. I t w as

not a b ad e stim ate in s o m e r e sp ects — alth ough it is o dd to s e e C au tio n r a te d

“la rg e,” fo r w hen G eo rg e re ach ed S an F ra n cis c o in 1 858 h e s k ip ped a sh ore ,

alth ough

he h ad s ig ned o n fo r a y ear, a n d h ead ed fo r V ic to ria a n d g old . H e

fo und g old — but it w as f o ol’s g old , a n d h e d ecid ed th e lif e a t s e a w as th e lif e

fo r h im a fte r a ll. In ste ad — his b um p o f C oncen tr a tiv en ess b ein g sm all— he

becam e a ty pese tte r in a S an F ra n cis c o s h op, th en a w eig her in a ric e m ill,

th en , i n h is o w n w ord s, “ a t r a m p.” A noth er t r e k t o t h e g old f ie ld s w as e q ually

unre w ard in g, a n d h e r e tu rn ed t o S an F ra n cis c o i m poveris h ed .

He m et A nnie F ox, a n d e lo ped w ith h er; sh e w as a se v en te en -y ear- o ld

in nocen t an d he a han dso m e young la d w ith a B ill C ody m usta ch e an d

poin te d b eard . T he t r u stin g y oung M is s F ox t o ok w ith h er a b ulk y p ack ag e o n

her s e cre t m arria g e flig ht; th e y oung a d ven tu re r th ought it m ig ht b e je w els ,

but i t t u rn ed o ut t o b e o nly t h e

House h old B ook o f P oetr y

a n d o th er v olu m es.

There f o llo w ed y ears o f th e m ost w re tc h ed p overty . H en ry G eo rg e w as a n

odd-jo b p rin te r, a n d w ork w as h ard to c o m e b y a n d ill p aid a t b est. W hen

Annie h ad h er se co nd c h ild , G eo rg e w ro te : “ I w alk ed a lo ng th e str e et a n d mad e u p m y m in d to g et m oney f ro m th e f ir s t m an w hose a p peara n ce m ig ht

in dic ate h e h ad it to g iv e. I sto pped a m an — a str a n ger— an d to ld h im I

wan te d $ 5. H e ask ed m e w hat I w an te d it fo r. I to ld h im m y w if e w as

co nfin ed a n d th at I h ad n oth in g to g iv e h er to e at. H e g av e m e th e m oney. I f

he h ad n ot, I t h in k I w as d esp era te e n ough t o h av e k ille d h im .”

Now — at ag e tw en ty -s ix — he beg an to w rite . H e la n ded a jo b in th e

co m posin g r o om o f t h e S an F ra n cis c o

Tim es

a n d s e n t a p ie ce u psta ir s t o N oah

Bro oks, th e e d ito r. B ro oks su sp ecte d th at th e b oy h ad c o pie d it, b ut w hen

noth in g re se m blin g it a p peare d in a n y o f th e o th er n ew sp ap ers fo r se v era l

day s h e p rin te d it, a n d th en w en t d ow nsta ir s to lo ok fo r G eo rg e. H e fo und

him , a slig ht y oung m an , ra th er u nders iz ed , sta n din g o n a b oard to ra is e

him se lf t o t h e h eig ht o f h is t y pe c ase . G eo rg e b ecam e a r e p orte r.

With in a fe w y ears h e le ft th e

Tim es

to jo in th e S an F ra n cis c o

Post

, a

cru sa d in g jo urn al. G eo rg e b eg an to w rite a b out m atte rs o f m ore th an r o utin e

in te re st: a b out th e C hin ese c o olie s a n d th eir in den tu re , a n d a b out th e la n d

gra b bin g o f th e r a ilr o ad s a n d th e m ach in atio ns o f th e lo cal tr u sts .

He w ro te a

lo ng l e tte r t o J . S . M ill i n F ra n ce o n t h e i m mig ra tio n q uestio n a n d w as g ra ced

with a lo ng aff ir m ativ e re p ly . A nd in betw een his new ly fo und politic al

in te re sts h e h ad tim e fo r v en tu re s in th e b est jo urn alis tic tr a d itio n: w hen th e

sh ip

Sunris e

c am e to to w n w ith a h ush ed -u p s to ry a b out a c ap ta in a n d m ate

who h ad h ounded th eir c re w u ntil tw o m en h ad le ap ed o verb oard to th eir

death , G eo rg e a n d th e

Post

fe rre te d o ut th e s to ry a n d b ro ught th e o ff ic ers to

ju stic e.

The n ew sp ap er w as s o ld , a n d H en ry G eo rg e w an gle d h im se lf a p olitic al

sin ecu re — In sp ecto r o f G as M ete rs . I t w as n ot t h at h e w an te d a l if e o f l e is u re ;

ra th er, h e h ad b eg un to r e ad th e g re at e co nom is ts a n d h is c en tr a l in te re st w as

now c le arly f o rm ed — alr e ad y h e w as a k in d o f l o cal a u th ority . H e n eed ed t im e

to stu dy a n d to w rite a n d to d eliv er le ctu re s to th e w ork in g c la sse s o n th e

id eas o f t h e g re at M ill.

When t h e U niv ers ity o f C alif o rn ia e sta b lis h ed a c h air o f p olitic al e co nom y,

he w as w id ely c o nsid ere d a s a s tr o ng c an did ate f o r t h e p ost. B ut t o q ualif y h e

had to d eliv er a le ctu re b efo re fa cu lty a n d stu den ts , a n d G eo rg e w as ra sh

en ough to v oic e s u ch s e n tim en ts a s th is : “ T he n am e o f p olitic al e co nom y h as

been co nsta n tly in voked ag ain st ev ery eff o rt of th e w ork in g cla sse s to

in cre ase th eir w ag es,” a n d th en to c o m pound th e s h ock h e a d ded : “ F or th e

stu dy o f p olitic al eco nom y, y ou n eed n o sp ecia l k now le d ge, n o ex te n siv e

lib ra ry , n o c o stly la b ora to ry . Y ou d o n ot e v en n eed te x tb ooks n or te ach ers , if

you w ill b ut t h in k f o r y ours e lv es.”

That w as th e beg in nin g an d th e en d of his acad em ic care er. A m ore

su ita b le can did ate w as fo und fo r th e post, an d G eo rg e w en t back to pam phle te erin g a n d s tu dy. A nd t h en s u dden ly , “ in d ay lig ht a n d i n a c ity s tr e et,

th ere c am e t o m e a t h ought, a v is io n, a c all— giv e i t w hat n am e y ou p le ase … .

It w as t h at t h at i m pelle d m e t o w rite

Pro gre ss a nd P overty

, a n d t h at s u sta in ed

me w hen e ls e I s h ould h av e f a ile d . A nd w hen I h ad f in is h ed th e la st p ag e, in

th e d ead o f n ig ht, w hen I w as e n tir e ly a lo ne, I f lu ng m yse lf o n m y k nees a n d

wep t l ik e a c h ild .”

As m ig ht b e ex pecte d , it w as a b ook w ritte n fro m th e h eart, a cry o f

min gle d p ro te st a n d h ope. A nd a s m ig ht a ls o b e e x pecte d , i t s u ff e re d f ro m t o o

much p assio n a n d to o little

pro fe ssio nal c ir c u m sp ectio n. B ut w hat a c o ntr a st

to th e d ull te x ts o f th e d ay — no w onder th e g uard ia n s o f e co nom ic s c o uld n ot

se rio usly c o nsid er a n a rg um en t t h at w as c o uch ed i n s u ch a s ty le a s t h is :

Tak e now … so m e hard -h ead ed busin ess m an , w ho has no th eo rie s, but

know s h ow t o m ak e m oney. S ay t o h im : “ H ere i s a l ittle v illa g e; i n t e n y ears i t

will b e a g re at c ity — in te n y ears th e r a ilr o ad w ill h av e ta k en th e p la ce o f th e

sta g e co ach , th e ele ctr ic lig ht of th e can dle ; it w ill ab ound w ith all th e

mach in ery a n d i m pro vem en ts t h at s o e n orm ously m ultip ly t h e e ff e ctiv e p ow er

of l a b or. W ill, i n t e n y ears , i n te re st b e a n y h ig her? ”

He w ill t e ll y ou, “ N o!”

“W ill t h e w ag es o f c o m mon l a b or b e a n y h ig her … ? ”

He w ill t e ll y ou, “ N o, t h e w ag es o f c o m mon l a b or w ill n ot b e a n y h ig her… .”

“W hat, t h en , w ill b e h ig her? ”

“R en t, th e valu e of la n d. G o, get yours e lf a pie ce of gro und, an d hold

posse ssio n.”

And if , u nder s u ch c ir c u m sta n ces, y ou ta k e h is a d vic e, y ou n eed d o n oth in g

more . Y ou m ay s it d ow n a n d s m oke y our p ip e; y ou m ay lie a ro und lik e th e

la zza ro ni

o f N ap le s o r th e

le p ero s

o f M ex ic o ; y ou m ay g o u p in a b allo on o r

dow n a h ole in th e g ro und; a n d w ith out d oin g o ne s tr o ke o f w ork , w ith out

ad din g o ne io ta o f w ealth to th e c o m munity , in te n y ears y ou w ill b e r ic h ! I n

th e new city you m ay hav e a lu xurio us m an sio n, but am ong its public

build in gs w ill b e a n a lm sh ouse .

We n eed n ot s p ell o ut t h e w hole e m otio nally c h arg ed a rg um en t; t h e c ru x o f

it l ie s i n t h is p assa g e. H en ry G eo rg e i s o utr a g ed a t t h e s p ecta cle o f m en w hose

in co m es— so m etim es fa b ulo us in co m es— deriv e n ot fro m th e se rv ic es th ey

hav e r e n dere d t h e c o m munity , b ut m ere ly f ro m t h e f a ct t h at t h ey h av e h ad t h e

good f o rtu ne t o h old a d van ta g eo usly s itu ate d s o il.

Ric ard o, o f c o urs e , s a w a ll th is lo ng b efo re h im . B ut a t b est, R ic ard o h ad

only c la im ed th at th e te n den cy o f a g ro w in g s o cie ty to e n ric h th e h old ers o f its la n d w ould r e d ound to th e m is fo rtu ne o f th e c ap ita lis t. T o H en ry G eo rg e,

th is w as o nly th e e n te rin g w ed ge. T he in ju stic e o f re n ts n ot o nly ro bbed th e

cap ita lis t o f h is h onest p ro fit b ut w eig hed o n t h e s h ould ers o f t h e w ork in gm an

as w ell. M ore d am ag in g y et, h e fo und it to b e th e c au se o f th ose in dustr ia l

“p aro xysm s,” a s h e c alle d th em , th at fro m tim e to tim e s h ook s o cie ty to its

ro ots .

The a rg um en t w as n ot t o o c le arly d elin eate d . P rim arily i t r e ste d o n t h e f a ct

th at s in ce re n t w as a ssu m ed fro m th e s ta rt to b e a k in d o f s o cia l e x to rtio n,

natu ra lly it re p re se n te d a n u nfa ir d is tr ib utio n o f p ro duce to la n dlo rd s a t th e

ex pen se o f w ork ers a n d in dustr ia lis ts . A nd a s fo r p aro xysm s— well, G eo rg e

was c o nvin ced th at re n t le d in ev ita b ly to w ild s p ecu la tio n in la n d v alu es (a s

in deed it d id o n th e W est C oast) a n d ju st a s in ev ita b ly to a n e v en tu al c o lla p se

whic h w ould b rin g t h e r e st o f t h e s tr u ctu re o f p ric es t u m blin g d ow n b esid e i t.

Hav in g d is c o vere d t h e t r u e c au se s o f p overty a n d t h e f u ndam en ta l c h eck t o

pro gre ss, it w as sim ple fo r G eo rg e to p ro pose a re m ed y— a sin gle m assiv e

ta x . It w ould b e a ta x o n la n d, a ta x th at w ould a b so rb a ll re n ts . A nd th en ,

with th e c an cer re m oved fro m th e b ody o f so cie ty , th e m ille n iu m c o uld b e

allo w ed t o c o m e. T he s in gle t a x w ould n ot o nly d is p en se w ith t h e n eed f o r a ll

oth er k in ds o f t a x es, b ut i n a b olis h in g r e n t i t w ould “ ra is e w ag es, i n cre ase t h e

earn in gs o f c ap ita l, e x tir p ate p au peris m , a b olis h p overty , g iv e re m unera tiv e

em plo ym en t to w hoev er w is h es it, a ff o rd f re e s c o pe to h um an p ow ers , p urif y

govern m en t, a n d c arry c iv iliz atio n to y et n oble r h eig hts .” I t w ould b e— th ere

is n o o th er w ord — th e u ltim ate p an acea.

It i s a n e lu siv e t h esis w hen w e s e ek t o e v alu ate i t. O f c o urs e i t i s n aiv e, a n d

th e eq uatio n of re n t w ith sin co uld hav e occu rre d only to so m eo ne as

messia n ic as G eo rg e him se lf . Sim ila rly , to put th e bla m e fo r in dustr ia l

dep re ssio ns on la n d sp ecu la tio n is to blo w up one sm all asp ect of an

ex pan din g e co nom y q uite o ut o f p ro portio n to re ality : la n d s p ecu la tio ns c an

be tr o uble so m e, b ut s e v ere d ep re ssio ns h av e ta k en p la ce in c o untr ie s w here

la n d v alu es w ere a n yth in g b ut i n fla te d .

So w e n eed n ot lin ger h ere . B ut w hen w e c o m e to th e c en tr a l b ody o f th e

th esis , w e m ust p au se . F or w hile G eo rg e’s m ech an ic al d ia g nosis i s s u perfic ia l

an d f a u lty , h is b asic c ritic is m o f s o cie ty is a m ora l a n d n ot a m ech an is tic o ne.

Why, ask s H en ry G eo rg e, sh ould re n t ex is t? W hy sh ould a m an ben efit

mere ly fro m th e fa ct o f o w ners h ip , w hen h e m ay re n der n o s e rv ic es to th e

co m munity in e x ch an ge? W e m ay ju stif y th e re w ard s o f a n in dustr ia lis t b y

desc rib in g h is p ro fits a s th e p riz e f o r h is f o re sig ht a n d in gen uity , b ut w here is

th e fo re sig ht o f a m an w hose g ra n dfa th er o w ned a p astu re o n w hic h , tw o

gen era tio ns l a te r, s o cie ty s a w f it t o e re ct a s k ysc ra p er?

The q uestio n i s p ro vocativ e, b ut i t i s n ot s o e asy t o c o ndem n t h e i n stitu tio n of r e n t o ut o f h an d. F or la n dlo rd s a re n ot th e o nly p assiv e b en efic ia rie s o f th e

gro w th o f s o cie ty . T he s to ck hold er in a n e x pan din g c o m pan y, th e w ork m an

whose p ro ductiv ity is e n han ced b y te ch nic al p ro gre ss, th e c o nsu m er w hose

re al in co m e ris e s a s th e n atio n p ro sp ers , a ll th ese a re a ls o b en efic ia rie s o f

co m munal a d van cem en t. T he u nearn ed g ain s th at a ccru e to a w ell- s itu ate d

la n dlo rd a re e n jo yed in d if f e re n t fo rm s b y a ll o f u s. T he p ro ble m is n ot ju st

th at o f la n d re n ts , b ut o f a ll u n earn ed in co m e; a n d w hile th is is c erta in ly a

se rio us p ro ble m , it c an not b e a d eq uate ly a p pro ach ed th ro ugh la n d o w ners h ip

alo ne.

And th en th e re n t p ro ble m is n ot so d ra stic a s it w as v ie w ed b y H en ry

Geo rg e. A sm all, b ut ste ad y flo w o f re n ts g oes to fa rm ers , h om eo w ners ,

modest c itiz en s. A nd e v en in th e m onopolis tic a re a o f r e n ta l in co m es— in th e

re al- e sta te opera tio ns of a m etr o polis — a sh if tin g an d flu id m ark et is in

opera tio n. R en ts a re n ot f ro zen in a rc h aic f e u dal p atte rn s, b ut c o nsta n tly p ass

fro m h an d to h an d a s la n d is b ought a n d so ld , a p pra is e d a n d re ap pra is e d .

Suff ic e it to p oin t o ut th at r e n ta l in co m e in th e U nite d S ta te s h as s h ru nk f ro m

6 p erc en t o f t h e n atio nal i n co m e i n 1 929 t o l e ss t h an 2 p erc en t t o day.

But n o m atte r w heth er th e th esis h eld to geth er lo gic ally o r w heth er its

mora l co ndem natio n w as fu lly ju stif ie d . T he book str u ck a tr e m en dously

re sp onsiv e c h ord .

Pro gre ss a nd P overty

b ecam e a b est- s e lle r, a n d o vern ig ht

Hen ry G eo rg e w as c ata p ulte d in to n atio nal p ro m in en ce. “ I c o nsid er

Pro gre ss

and P overty

a s

th e

b ook o f th is h alf -c en tu ry ,” sa id th e re v ie w er in th e S an

Fra n cis c o

Arg onaut

, a n d th e N ew Y ork

Trib une

c la im ed th at it h ad “ n o e q ual

sin ce th e p ublic atio n o f th e

Wea lth o f N atio ns

b y A dam S m ith .” E ven th ose

public atio ns lik e th e

Exa m in er

an d

Chro nic le

, w hic h calle d it “th e m ost

pern ic io us tr e atis e o n p olitic al e co nom y th at h as b een p ublis h ed fo r m an y a

day,” o nly s e rv ed t o e n han ce i ts f a m e.

Geo rg e w en t to E ngla n d; h e re tu rn ed a fte r a le ctu re to ur a n in te rn atio nal

fig ure . H e w as d ra fte d to r u n f o r m ay or o f N ew Y ork , a n d in a th re e-c o rn ere d

ra ce h e b eat T heo dore R oose v elt an d o nly n arro w ly lo st to th e T am man y

can did ate .

The s in gle t a x w as a r e lig io n t o h im b y n ow . H e o rg an iz ed L an d a n d L ab or

Clu bs an d le ctu re d to en th usia stic au die n ces h ere an d in G re at B rita in . A

frie n d a sk ed h im , “ D oes th is m ean w ar? C an y ou, u nle ss d ealin g w ith c ra v en

co nditio ns a m ong m en , h ope t o t a k e l a n d a w ay f ro m i ts o w ners w ith out w ar? ”

“I d o n ot s e e,” s a id G eo rg e, “ th at a m usk et n eed b e fir e d . B ut if n ecessa ry ,

war b e i t, t h en . T here w as n ev er a h olie r c au se . N o, n ev er a h olie r c au se !”

“H ere w as th e g en tle st a n d k in dest o f m en ,” c o m men ts h is frie n d, J a m es

Russe ll T ay lo r, “w ho w ould sh rin k fro m a gun fir e d in an ger, re ad y fo r

univ ers a l w ar ra th er th an th at h is g osp el s h ould n ot b e a ccep te d . It w as th e co ura g e … w hic h m ak es o ne a m ajo rity .”

Need le ss to sa y, th e w hole doctr in e w as an ath em a to th e w orld of

re sp ecta b le opin io n. A C ath olic prie st w ho had asso cia te d him se lf w ith

Geo rg e in h is m ay ora lty fig ht w as te m pora rily e x co m munic ate d ; th e P ope

him se lf a d dre sse d a n e n cy clic al to th e la n d q uestio n; a n d w hen G eo rg e s e n t

him a n e la b ora te ly p rin te d a n d b ound r e p ly , it w as ig nore d . “ I w ill n ot in su lt

my re ad ers b y d is c u ssin g a p ro je ct so ste ep ed in in fa m y,” w ro te G en era l

Fra n cis A . W alk er, a le ad in g p ro fe ssio nal e co nom is t in th e U nite d S ta te s; b ut

while o ff ic ia ld om lo oked a t h is b ook w ith s h ock o r w ith a m use d c o nte m pt,

th e m an h im se lf s tr u ck h om e t o h is a u die n ce.

Pro gre ss a nd P overty

s o ld m ore

co pie s th an a ll th e e co nom ic te x ts p re v io usly p ublis h ed in th e c o untr y ; in

Engla n d, h is n am e b ecam e a h ouse h old w ord . N ot o nly t h at, b ut t h e i m port o f

his id eas— alb eit u su ally in w ate re d fo rm — becam e p art o f th e

herita g e o f

men lik e W oodro w W ils o n, Jo hn D ew ey, L ouis B ra n deis . In deed th ere is a

dev ote d f o llo w in g o f H en ry G eo rg e’s s till a ctiv e t o day.

In 1 897, o ld , u nw ell, b ut still in dom ita b le , h e p erm itte d h im se lf to b e

dra fte d fo r a s e co nd m ay ora lty ra ce, k now in g fu ll w ell th at th e s tr a in o f th e

cam paig n m ig ht b e to o m uch fo r h is fa ilin g h eart. It w as; h e w as calle d

“m ara u der,” “assa ila n t of oth er peo ple ’s rig ht,” “ap ostle of an arc h y an d

destr u ctio n,” an d h e d id d ie , o n th e ev e o f th e ele ctio n. H is fu nera l w as

atte n ded b y th ousa n ds. H e w as a r e lig io us m an ; le t u s h ope th at h is s o ul w en t

str a ig ht to heav en . A s fo r his re p uta tio n— th at w en t str a ig ht in to th e

underw orld o f e co nom ic s, a n d th ere h e e x is ts to day ; a lm ost- M essia h , s e m i-

cra ck pot, an d dis tu rb in g questio ner of th e m ora lity of our eco nom ic

in stitu tio ns.

But so m eth in g els e w as goin g on in th e underw orld , so m eth in g m ore

im porta n t th an H en ry G eo rg e’s fu lm in atio ns ag ain st re n t an d his ecsta tic

vis io n o f a C ity o f G od to b e b uilt o n th e f o undatio n o f th e s in gle ta x . A n ew

an d v ig oro us sp ir it w as sw eep in g E ngla n d a n d th e C ontin en t a n d e v en th e

Unite d S ta te s, a sp ir it th at m an if e ste d its e lf in th e pro lif e ra tio n of su ch

slo gan s a s “ T he A nglo -S ax on r a ce i s i n fa llib ly d estin ed t o b e t h e p re d om in an t

fo rc e i n t h e h is to ry a n d c iv iliz atio n o f t h e w orld .” T he s p ir it w as n ot c o nfin ed

to E ngla n d: a cro ss th e C han nel, V ic to r H ugo d ecla re d , “ F ra n ce is n eed ed b y

hum an ity ”; in Russia th e sp okesm an fo r ab so lu tis m , Konsta n tin

Pobyed onosts e v, p ro cla im ed th at R ussia ’s f re ed om f ro m th e ta in t o f W este rn

decad en ce h ad g iv en h er th e a cco la d e o f le ad ers h ip f o r th e E ast. I n G erm an y

th e K ais e r w as e x pla in in g h ow

der a lte G ott

w as o n t h eir s id e; a n d i n t h e N ew

World , T heo dore R oose v elt w as m ak in g h im se lf t h e A m eric an s p okesm an f o r

a s im ila r p hilo so phy.

The ag e of im peria lis m had beg un, an d th e m ap m ak ers w ere busy ch an gin g t h e c o lo rs t h at d en ote d o w ners h ip o f t h e d ark er c o ntin en ts . B etw een

1870 a n d 1 898 B rita in a d ded 4 m illio n s q uare m ile s a n d 8 8 m illio n p eo ple to

its e m pir e ; F ra n ce g ain ed n early th e s a m e a re a o f te rrito ry , w ith 4 0 m illio n

so uls atta ch ed ; G erm an y w on a m illio n m ile s an d 16 m illio n

co lo nia ls ;

Belg iu m to ok 9 00,0 00 m ile s a n d 3 0 m illio n p eo ple ; e v en P ortu gal jo in ed th e

ra ce, w ith 8 00,0 00 m ile s o f n ew l a n ds a n d 9 m illio n i n hab ita n ts .

In t r u th , t h re e g en era tio ns h ad c h an ged t h e f a ce o f t h e e arth . B ut m ore t h an

th at, th ey h ad w itn esse d a n e q ually re m ark ab le c h an ge in th e a ttitu de w ith

whic h th e W est v ie w ed th at p ro cess o f c h an ge. I n th e d ay s o f A dam S m ith , it

will b e re m em bere d , th e S co ts p hilo so pher re g ard ed w ith s c o rn th e a tte m pts

of m erc h an ts to p la y th e r o le o f k in gs, a n d h e u rg ed th e in dep en den ce o f th e

Am eric an C olo nie s. A nd S m ith ’s c o nte m pt fo r c o lo nie s w as w id ely s h are d :

Ja m es M ill, th e f a th er o f J o hn S tu art M ill, c alle d th e c o lo nie s “ a v ast s y ste m

of o utd oor re lie f fo r th e u pper c la sse s,” a n d e v en D is ra eli in 1 852 h ad p ut

him se lf o n re co rd a s b elie v in g th at “ th ese w re tc h ed c o lo nie s a re m ills to nes

aro und o ur n eck s.”

But n ow a ll th is h ad c h an ged . B rita in h ad a cq uir e d h er e m pir e , a s it h ad

fre q uen tly been re m ark ed , in a fit of ab se n t- m in ded ness, but

ab se n tm in ded ness was re p la ced by sin gle -m in ded ness as th e pace of

im peria lis m a ccele ra te d . L ord R ose b ery e p ito m iz ed th e s e n tim en t o f th e d ay

when h e c alle d th e B ritis h E m pir e “ th e g re ate st s e cu la r a g en cy fo r g ood th e

world has ev er know n.” “Y es,” sa id M ark Tw ain , w atc h in g a Ju bile e

pro cessio n fo r Q ueen Vic to ria w hic h pro udly dis p la y ed th e pom p of

Engla n d’s p osse ssio ns, “ th e E nglis h a re m en tio ned i n S crip tu re — ‘B le sse d a re

th e m eek , f o r t h ey s h all i n herit t h e e arth .’ ”

By m ost p eo ple , t h e r a ce f o r e m pir e w as a p pro vin gly r e g ard ed . I n E ngla n d,

Kip lin g w as its p oet la u re ate , an d th e p opula r se n tim en t w as th at o f th e

music -h all s o ng:

We d on’t w an t t o f ig ht, b ut b y j in go i f w e d o,

We’v e g ot t h e s h ip s, w e’v e g ot t h e m en , w e’v e g ot t h e m oney t o o!

Anoth er, r a th er d if f e re n t n od o f a p pro val c am e f ro m t h ose w ho a g re ed w ith

Sir C harle s C ro ssth w aite th at th e r e al q uestio n b etw een B rita in a n d S ia m w as

“w ho w as to g et th e tr a d e w ith th em , a n d h ow w e c o uld m ak e th e m ost o f

th em , s o a s t o f in d f re sh m ark ets f o r o ur g oods a n d a ls o e m plo ym en t

fo r t h ose

su perflu ous a rtic le s o f t h e p re se n t d ay, o ur b oys.”

And t h en , t o o, t h e p ro cess o f e m pir e b uild in g b ro ught w ith i t p ro sp erity f o r

th e em pir e b uild ers . N o sm all p art o f th e g ain in w ork in g-c la ss am en itie s

whic h h ad s o p le ase d th e C om mitte e o n D ep re ssio n w as th e r e su lt o f s w eate d

la b or o vers e as: t h e c o lo nie s w ere n ow t h e p ro le ta ria t’s p ro le ta ria t. N o w onder im peria lis m w as a p opula r p olic y.

Thro ughout a ll o f th is , th e o ff ic ia ld om o f e co nom ic s sto od to o ne sid e,

watc h in g th e p ro cess o f im peria l g ro w th w ith e q uan im ity , a n d c o nfin in g its

re m ark s to th e e ff e ct th at n ew p osse ssio ns m ig ht h av e o n th e c o urs e o f tr a d e.

Again it w as th e c ritic s o f th e u nderw orld th at f o cu se d a tte n tio n o n th is n ew

phen om en on of his to ry . For, as th ey lo oked at th e w orld w id e ra ce fo r

dom in atio n, th ey s a w s o m eth in g v ery d if f e re n t fro m th e m ere e x citin g c la sh

of p olitic s o r t h e i n ex plic ab le w him s o f p ers o nalitie s i n p ow er.

They s a w a w hole n ew d ir e ctio n t o t h e d rif t o f c ap ita lis m ; i n f a ct, t h ey s a w

im peria lis m a s s ig nalin g a c h an ge in th e f u ndam en ta l c h ara cte r o f c ap ita lis m

its e lf . S till m ore sig nif ic an t, th ey div in ed in th e new re stle ss pro cess of

ex pan sio n th e m ost d an gero us te n den cy th at c ap ita lis m h ad y et re v eale d — a

te n den cy t h at l e d t o w ar.

It w as a m ild -m an nere d h ere tic w ho f ir s t m ad e th is c h arg e, th e p ro duct, a s

he d esc rib ed h im se lf , o f “ th e m id dle s tr a tu m o f th e m id dle c la ss o f a m id dle -

siz ed to w n o f th e M id la n ds.” Jo hn A . H obso n w as a fra il little m an , m uch

worrie d o ver h is h ealth a n d p la g ued b y a n im ped im en t in h is s p eech w hic h

mad e h im n erv ous a b out l e ctu rin g. B orn i n 1 858, h e p re p are d f o r a n a cad em ic

care er at O xfo rd ; an d b y all w e k now o f h is b ack gro und an d p ers o nality

(w hic h is n ot m uch , fo r th is sh y a n d re tir in g m an m an ag ed su ccessfu lly to

av oid

Who’s W ho)

, h e w as d estin ed fo r th e c lo is te re d a n onym ity o f E nglis h

public -s c h ool l if e .

Tw o f a cto rs i n te rv en ed . H e r e ad t h e w ork s o f R usk in , t h e B ritis h c ritic a n d

essa y is t w ho m ock ed a t t h e b ourg eo is V ic to ria n c an ons o f m oneta ry v alu e a n d

who tr u m pete d , “ W ealth is lif e !” F ro m R usk in , H obso n a cq uir e d a n id ea o f

eco nom ic s a s a h um an is t ra th er th an a n im pers o nal sc ie n ce; a n d h e tu rn ed

fro m th e r e fin em en t o f o rth odox d octr in e to p re ach in g th e v ir tu es o f a w orld

where co opera tiv e la b or guild s w ould giv e a hig her valu e to hum an

pers o nality th an th e c ra ss w orld o f w ag es a n d p ro fits . H is s c h em e, H obso n

in sis te d , w as “ as c erta in a s a p ro positio n i n E uclid .”

As a U to pia n h e m ig ht h av e b een r e sp ecta b le ; th e E nglis h lik e e ccen tr ic s.

It w as a s a h ere tic , a tr a m ple r o n th e v ir tu es o f tr a d itio n, th at h e b ecam e a n

eco nom ic p aria h . C han ce t h re w h im i n to t h e c o m pan y o f a p ers o n c alle d A . F .

Mum mery , a n in dep en den t th in ker, a s u ccessfu l b usin essm an , a n d a n in tr e p id

mounta in c lim ber ( h e w as to m eet h is d eath in 1 895 o n th e h eig hts o f N an ga

Parb at) . “ M y in te rc o urs e w ith h im , I n eed h ard ly s a y,” w rite s H obso n, “ d id

not lie o n th is p hysic al p la n e. B ut h e w as a m en ta l clim ber as w ell… .”

Mum mery h ad s p ecu la te d a s to th e c au se o f th ose p erio dic s lu m ps in tr a d e

whic h h ad w orrie d t h e b usin ess c o m munity a s f a r b ack a s t h e e arly e ig hte en th

cen tu ry , a n d h e h ad a n id ea a s to th eir o rig in , w hic h w as, a s H obso n p ut it, co nsid ere d b y th e p ro fe sso rd om “ as e q uiv ale n t in r a tio nality to a n a tte m pt to

pro ve th e f la tn ess o f th e e arth .” F or M um mery , h eark en in g b ack to M alth us,

th ought th at th e c au se o f d ep re ssio n la y in th e f a ct o f e x cessiv e

sa vin g

, in th e

ch ro nic in ab ility of th e busin ess sy ste m to dis tr ib ute en ough purc h asin g

pow er t o b uy i ts o w n p ro ducts b ack .

Hobso n a rg ued a t fir s t a n d th en b ecam e c o nvin ced th at M um mery w as

rig ht. T he tw o w ro te

The P hysio lo gy o f In dustr y

, s e ttin g fo rth th eir h ere tic al

notio n th at s a v in gs m ig ht u nderm in e p ro sp erity . T his w as to o m uch fo r th e

off ic ia l w orld t o s w allo w . H ad n ot a ll t h e g re at e co nom is ts , f ro m A dam S m ith

onw ard , s tr e sse d th e f a ct th at s a v in g w as o nly o ne s id e o f th e g old en c o in o f

accu m ula tio n? D id n ot e v ery a ct o f s a v in g a u to m atic ally a d d to th e fu nd o f

cap ita l w hic h w as u se d to p ut m ore p eo ple to w ork ? T o s a y th at s a v in g m ig ht

re su lt in u nem plo ym en t w as n ot o nly n onse n se o f th e m ost a rra n t k in d, b ut it

was positiv ely in im ic al to one of th e le g s of so cia l sta b ility — th rif t. T he

eco nom ic w orld w as sh ock ed : th e L ondon U niv ers ity E xte n sio n L ectu re s

fo und th at th ey c o uld m an ag e to d is p en se w ith M r. H obso n’s p re se n ce;

th e

Charity O rg an iz atio n S ocie ty w ith dre w a n in vita tio n to sp eak . T he sc h ola r

had b eco m e a h ere tic a n d t h e h ere tic n ow b ecam e, p erfo rc e, a n o utc ast.

All t h is s e em s c o nsid era b ly r e m oved f ro m t h e p ro ble m o f i m peria lis m . B ut

id eas germ in ate in dev io us w ay s. H obso n’s ex clu sio n fro m th e w orld of

re sp ecta b ility le d h im in to th e p ath o f so cia l c ritic is m , a n d th e so cia l c ritic

now t u rn ed h is a tte n tio n t o t h e g re at p olitic al p ro ble m o f t h e d ay : A fric a.

The back gro und of th e A fric an pro ble m w as co m ple x an d em otio nal.

Dutc h s e ttle rs h ad s e t u p th eir in dep en den t s ta te s in th e T ra n sv aal c o untr y in

1836, s o lid c o m munitie s o f “ K aff ir - flo ggin g, B ib le -re ad in g” f a rm ers . B ut th e

la n d th ey c h ose , w id e a n d s u nny a n d e x hila ra tin g a s it w as, h id m ore w ealth

th an it d is p la y ed . I n 1 869 d ia m onds w ere d is c o vere d ; in 1 885 g old . W ith in a

fe w y ears th e p ace o f a n o xcart s e ttle m en t w as tr a n sfo rm ed in to th e f re n zie d

ex cite m en t o f a co m munity o f sp ecu la to rs . C ecil R hodes ap peare d o n th e

sc en e w ith h is p ro je cts o f r a ilr o ad s a n d in dustr y ; in a m om en t o f m ad ness h e

sa n ctio ned a ra id in to th e T ra n sv aal a n d th e lo ng-s tr a in ed te m pers o f b oth

Englis h a n d D utc h b urs t t h eir b onds. T he B oer W ar b eg an .

Hobso n h ad a lr e ad y g one to A fric a. T his “ tim id est o f G od’s c re atu re s,” a s

he calle d him se lf , tr a v ele d to C ap eto w n an d Jo han nesb urg , ta lk ed w ith

Kru ger a n d S m uts , a n d fin ally d in ed w ith R hodes h im se lf o n th e e v e o f th e

Tra n sv aal ra id . R hodes w as a c o m plic ate d a n d p erp le x in g p ers o nality . T w o

years b efo re h is A fric an a d ven tu re , a j o urn alis t h ad q uote d h im a s s a y in g:

“I w as in th e E ast E nd o f L ondon y este rd ay a n d a tte n ded a m eetin g o f th e

unem plo yed . I l is te n ed t o t h e w ild s p eech es, w hic h w ere j u st a c ry f o r ‘ b re ad ,’

‘b re ad ,’ ‘b re ad ,’ an d o n m y w ay h om e I p ondere d o ver th e sc en e… . M y ch eris h ed id ea is a s o lu tio n f o r th e s o cia l p ro ble m s; i.e ., in o rd er to s a v e th e

40,0 00,0 00 in hab ita n ts o f th e U nite d K in gdom fro m a b lo ody c iv il w ar, w e

co lo nia l s ta te sm en m ust a cq uir e n ew la n ds to s e ttle th e s u rp lu s p opula tio n, to

pro vid e n ew m ark ets fo r th e g oods p ro duced

by th em in th e fa cto rie s a n d

min es. T he E m pir e , a s I h av e a lw ay s s a id , i s a b re ad a n d b utte r q uestio n.”

We d o n ot k now w heth er h e e x pounded th e s a m e s e n tim en ts to H obso n;

th e p ro bab ility is th at h e d id . B ut it w ould h av e m ad e little d if f e re n ce. F or

what H obso n s a w in A fric a d oveta ile d in th e m ost u nex pecte d w ay w ith th e

eco nom ic h ere sy o f w hic h h e a n d M um mery h ad b een c o nvic te d : th e th eo ry

of o vers a v in g.

He re tu rn ed to B rita in to w rite a b out jin gois m a n d th e w ar in A fric a, a n d

th en in 1902 he pre se n te d th e w orld w ith a book in w hic h his A fric an

obse rv atio ns w ere s tr a n gely m eld ed w ith h is h ere tic al v ie w s.

The b ook w as c alle d

Im peria lis m ;

it w as a d ev asta tin g v olu m e. F or h ere

was t h e m ost i m porta n t a n d s e arin g c ritic is m t h at h ad e v er b een l e v ie d a g ain st

th e p ro fit s y ste m . T he w ors t t h at M arx h ad c la im ed w as t h at t h e s y ste m w ould

destr o y i ts e lf ; w hat H obso n s u ggeste d w as t h at i t m ig ht d estr o y t h e w orld . H e

sa w th e pro cess of im peria lis m as a re le n tle ss an d re stle ss te n den cy of

cap ita lis m to re sc u e its e lf fro m a se lf -im pose d dile m ma, a te n den cy th at

necessa rily in volv ed fo re ig n co m merc ia l co nquest an d th at th ere b y

in esc ap ab ly in volv ed a co nsta n t ris k of w ar. N o m ore pro fo und m ora l

in dic tm en t o f c ap ita lis m h ad e v er b een p ose d .

What w as t h e s u bsta n ce o f H obso n’s c h arg e?

It w as a n a rg um en t a lm ost M arx ia n in its im pers o nality a n d in ex ora b le

dev elo pm en t (a lth ough H obso n h ad n o s y m path y fo r th e M arx is ts a n d th eir

aim s). I t c la im ed t h at c ap ita lis m f a ced a n i n so lu ble i n te rn al d if f ic u lty a n d t h at

it w as f o rc ed t o t u rn t o i m peria lis m , n ot o ut o f a p ure l u st f o r c o nquest, b ut t o

en su re i ts o w n e co nom ic s u rv iv al.

That in te rn al c ap ita lis t d if f ic u lty w as a n a sp ect o f th e s y ste m w hic h h ad

re ceiv ed su rp ris in gly little atte n tio n in th e past— cap ita lis m ’s uneq ual

dis tr ib utio n o f w ealth . T he fa ct th at th e w ork in gs o f th e p ro fit s y ste m v ery

ofte n re su lte d in a lo psid ed d is tr ib utio n o f w ealth h ad lo ng b een a to pic fo r

mora l c o ncern , b ut its

eco nom ic

c o nse q uen ces w ere le ft fo r H obso n to p oin t

out.

The c o nse q uen ce h e s a w w as m ost s u rp ris in g. T he in eq uality o f in co m es

le d t o t h e s tr a n gest o f d ile m mas— a p ara d oxic al s itu atio n i n w hic h n eith er r ic h

nor p oor c o uld c o nsu m e e n ough g oods. T he p oor c o uld n ot c o nsu m e e n ough

becau se t h eir i n co m es w ere t o o s m all, a n d t h e r ic h c o uld n ot c o nsu m e e n ough

becau se th eir in co m es w ere to o b ig ! I n o th er w ord s, s a id H obso n, in o rd er to cle ar its o w n m ark et, a n e co nom y m ust c o nsu m e e v ery th in g th at it m ak es:

each g ood m ust h av e a b uyer. N ow , if th e p oor c an not a ff o rd to ta k e m ore

th an t h e b are e sse n tia ls , w ho i s t h ere t o t a k e t h e r e st? O bvio usly , t h e r ic h . B ut

while th e r ic h h av e th e m oney, th ey la ck th e p hysic al c ap acity f o r

th at

m uch

co nsu m ptio n: a m an w ith a m illio n-d olla r in co m e w ould h av e to c o nsu m e

goods w orth a th ousa n d tim es th ose b ought b y a m an w ith o nly a th ousa n d

dolla rs t o s p en d.

And so , a s a c o nse q uen ce o f a n in eq uita b le d iv is io n o f w ealth , th e ric h

were fo rc ed

to s a v e. T hey s a v ed n ot o nly b ecau se m ost o f th em w is h ed to ,

an yw ay, b ut b ecau se t h ey c o uld n ot v ery w ell h elp t h em se lv es— th eir i n co m es

were s im ply t o o l a rg e t o b e c o nsu m ed .

It w as th is sa v in g th at le d to tr o uble . T he a u to m atic sa v in gs o f th e ric h

str a ta o f s o cie ty h ad to b e p ut to u se , if th e e co nom y w as n ot to s u ff e r fro m

th e dis a str o us eff e cts of an in su ff ic ie n cy of purc h asin g pow er. B ut th e

questio n w as

how

to p ut th e sa v in gs to w ork . T he c la ssic al a n sw er w as to

in vest th em in e v er m ore f a cto rie s a n d m ore p ro ductio n a n d th us to a sc en d to

an e v en h ig her le v el o f o utp ut a n d p ro ductiv ity : S m ith , R ic ard o, M ill, a ll th e

gre at e co nom is ts a g re ed o n th is s o lu tio n to th e p ro ble m . B ut H obso n s a w a

dif f ic u lty in th e w ay. F or if th e m ass o f th e p eo ple w ere

alr e a dy

h av in g

tr o uble b uyin g a ll t h e g oods t h ro w n o n t h e m ark et b ecau se t h eir i n co m es w ere

to o s m all, h ow , h e a sk ed , c o uld a s e n sib le c ap ita lis t in vest in e q uip m en t th at

would th ro w still m ore g oods o n a n o verc ro w ded m ark et? W hat w ould b e

gain ed fro m in vestin g s a v in gs in a n oth er s h oe fa cto ry , le t u s s a y, w hen th e

mark et w as alr e ad y sw am ped w ith m ore sh oes th an co uld be re ad ily

ab so rb ed ? W hat w as t o b e d one?

Hobso n’s a n sw er w as d ev ilis h ly n eat. T he a u to m atic sa v in gs o f th e ric h

co uld be in veste d in one w ay th at w ould put

th em to use w ith out th e

tr o uble so m e acco m pan im en t o f m ore p ro ductio n at h om e. T hey co uld b e

in veste d o vers e as.

And th is is th e g en esis o f im peria lis m . I t is , w ro te H obso n, “ th e e n deav or

of t h e g re at c o ntr o lle rs o f i n dustr y t o b ro ad en t h e c h an nel f o r t h e f lo w o f t h eir

su rp lu s w ealth b y s e ek in g f o re ig n m ark ets a n d f o re ig n i n vestm en ts t o t a k e o ff

th e g oods a n d c ap ita l t h ey c an not u se a t h om e.”

The r e su lt is d is a str o us. F or it is n ot o ne n atio n o nly w hic h is s e n din g its

su rp lu s w ealth a b ro ad . A ll n atio ns a re in th e s a m e b oat. H en ce th ere e n su es a

ra ce to partitio n th e w orld , w ith each natio n tr y in g to fe n ce off fo r its

in vesto rs th e ric h est an d m ost lu cra tiv e m ark ets it can se iz e. T hus A fric a

beco m es a h uge m ark et (a n d a so urc e o f c h eap ra w m ate ria ls ) to b e sp lit

am ong th e c ap ita lis ts o f E ngla n d a n d G erm an y a n d Ita ly a n d B elg iu m ; A sia

beco m es a r ic h p ie to b e c arv ed u p a m ong th e J a p an ese a n d th e R ussia n s a n d th e D utc h . In dia b eco m es a d um pin g g ro und fo r B ritis h in dustr y , a n d C hin a

beco m es a n I n dia f o r J a p an .

Im peria lis m th us p av es th e w ay to w ar— not b y s w ash buck lin g a d ven tu re s

or hig h tr a g ed y, but th ro ugh a so rd id pro cess in w hic h cap ita lis t natio ns

co m pete fo r o utle ts fo r th eir u nem plo yed w ealth . A le ss-in sp ir in g c au se fo r

blo odsh ed c o uld h ard ly b e i m ag in ed .

Need le ss to sa y, su ch a th eo ry of vio le n ce an d str u ggle fo und little

en co ura g em en t in th e o ff ic ia l w orld o f e co nom is ts . H obso n, it w as s a id , k ep t

“m uddlin g e co nom ic s u p w ith o th er th in gs” a n d sin ce th ose “ o th er th in gs”

were h ard ly s u ggestiv e o f a w orld o rg an iz ed a ro und th e p urs u it o f p le asu re ,

th e o ff ic ia l w orld r e g ard ed t h e t h eo ry o f i m peria lis m a s a d is p la y o f t h e s o rt o f

bad m an ners o ne w ould e x pect o f a m an w hose e co nom ic s o utr a g ed su ch

co m mon-s e n se d octr in es a s t h e s o cia l b en efic en ce o f t h rif t.

But w hile th e d octr in e w as s c ru pulo usly a v oid ed b y th ose w ho m ig ht h av e

su bje cte d it to an in te llig en t, if critic al, sc ru tin y, it was em bra ced

whole h earte d ly b y a n oth er s e ctio n o f th e u nderw orld : th e M arx is ts . T he id ea,

afte r all, w as not en tir e ly orig in al w ith H obso n; varia n ts of it had been

work ed out by a G erm an eco nom is t nam ed Rodbertu s, an d by Rosa

Luxem burg , a fie ry G erm an re v olu tio nis t. B ut H obso n’s

tr e atm en t w as

bro ad er a n d d eep er, a n d it w as e m bro id ere d in to th e o ff ic ia l c lo ak o f M arx is t

doctr in e by none oth er th an th eir le ad in g th eo re tic ia n — an ex ile nam ed

Vla d im ir I lic h U ly an ov, b ette r k now n a s L en in .

The th eo ry em erg ed fro m its b ap tis m so m ew hat ch an ged . H obso n h ad

puzzle d o ver th e q uestio n o f w hy c ap ita lis t n atio ns s o a v id ly s o ught c o lo nie s

afte r d ecad es o f m ore o r le ss in dif f e re n ce to th em . H is th eo ry o f im peria lis m

was not a dogm a, an d still le ss an ir o ncla d pre d ic tio n of ab so lu te ly

in esc ap ab le w ar. I n deed , h e e x pre sse d th e h ope th at r iv al im peria lis m s m ig ht

arra n ge a k in d o f fin al s e ttle m en t o f th e w orld a n d e x is t p eaceab ly s id e b y

sid e o n a l iv e-a n d-le t- liv e b asis .

But in M arx is t g arb , th e th eo ry to ok o n to nes b oth m ore m en acin g a n d

more in ex ora b le . N ot o nly w as im peria lis m p la ced as th e cap sto ne o f th e

Marx is t e co nom ic a rc h , b ut it w as b ro ad en ed a n d w id en ed b ey ond H obso n’s

fra m ew ork u ntil it a cco unte d fo r th e w hole so cia l c o m ple x io n o f la tte r- d ay

cap ita lis m . A nd w hat a f rig hte n in g p ic tu re e m erg ed !

Im peria lis m , th e hig hest phase of cap ita lis t dev elo pm en t, im men se ly

in cre ase s t h e p ro ductiv e f o rc es o f t h e w orld e co nom y, s h ap es t h e e n tir e w orld

in its o w n im ag e, a n d d ra g s a ll c o lo nie s, a ll r a ces, a ll p eo ple s in to th e s p here

of fin an ce c ap ita lis t e x plo ita tio n. A t th e sa m e tim e th e m onopolis t fo rm o f

cap ita l in cre asin gly d ev elo ps e le m en ts o f p ara sitic d eg en era tio n a n d d ecay … . Im peria lis m p ile s u p u nto ld w ealth f ro m t h e i m men se s u perp ro fits i t s q ueezes

out of th e m illio ns of co lo nia l w ork ers an d peasa n ts . In th is pro cess,

im peria lis m c re ate s t h e t y pe o f t h e d ecay in g, p ara sitic ally d eg en era tin g r e n tie r

sta te a n d e n tir e s tr a ta o f p ara site s w ho liv e b y c o upon c lip pin g. T he e p och o f

im peria lis m , whic h co m ple te s th e pro cess of cre atin g th e mate ria l

pre re q uis ite s of so cia lis m (c o ncen tr a tio n of th e m ean s of pro ductio n,

so cia liz atio n o f la b our o n a g ig an tic sc ale , th e str e n gth en in g o f w ork ers ’

org an iz atio ns) a t th e s a m e tim e m ak es th e c o ntr a d ic tio ns b etw een th e “ G re at

Pow ers ” sh arp er, a n d p ro vokes w ars w hic h re su lt in th e b re ak dow n o f th e

sin gle w orld e co nom y. T hus im peria lis m is d ecay in g, d yin g c ap ita lis m . It is

th e la st sta te o f cap ita lis t d ev elo pm en t as a w hole ; it is th e o nse t o f th e

so cia lis t w orld r e v olu tio n.

The w rite r is B ukharin ; th e o ccasio n, th e T hir d In te rn atio nal; th e d ate ,

1928. W rite r, o ccasio n, a n d d ate n otw ith sta n din g, th e v oic e w e h ear is th at o f

Len in . A nd m ore dis tu rb in g yet, L en in ’s co ncep tio n of a ra v ag in g an d

ra v ag ed cap ita lis m , in te rn ally co rru pt an d ex te rn ally pre d ato ry , w as th e

fo rm al S ovie t e x pla n atio n o f th e w orld in w hic h w e liv e u ntil th e d em is e o f

th e S ovie t U nio n.

Of th e f a ct o f im peria lis m th ere is n o d oubt. N o o ne w ho is f a m ilia r w ith

th e h is to ry o f t h e l a te n in ete en th a n d e arly t w en tie th c en tu rie s c an f a il t o m ark

th e lin e o f p lu nder, te rrito ria l ag gra n diz em en t, an d o ppre ssiv e co lo nia lis m

th at ru ns lik e a te llta le th re ad th ro ugh th e e n dle ss in cid en ts o f in te rn atio nal

je alo usy , fric tio n, a n d w ar. If it is n o lo nger fa sh io nab le to re g ard th e F ir s t

World W ar as “p ure ly ” an im peria lis t co nflic t, th ere is no doubt th at

im peria lis t j o ck ey in g f o r p ositio n d id m uch t o b rin g i t i n to b ein g.

But c o nquest a n d c o lo nie s a re a s o ld a s a n cie n t E gypt, a n d a s th e S ovie t

in vasio ns o f H ungary , C zech oslo vak ia , a n d A fg han is ta n h av e m ad e c le ar in

modern tim es, th ey w ill c o ntin ue w heth er c ap ita lis m is th ere to fu rn is h a n

ex cu se o r n ot. T he q uestio n t h at t h e

eco nom ic

t h eo ry o f i m peria lis m m ak es u s

fa ce is w heth er th e co nquests o f th e la st fif ty y ears h av e b een d if f e re n tly

motiv ate d fro m th e c o nquests th at c am e b efo re o r m ay fo llo w a fte r. It is a

sim ple m atte r to unders ta n d th e th ir s t fo r pow er of th e dynastic sta te .

Im peria lis m a sk s u s to c o nsid er w heth er th e m ore im pers o nal fo rc es o f th e

mark et e co nom y c an l e ad t o t h e s a m e e n d r e su lt.

The a p olo gis ts fo r th e c o lo nia l s y ste m c la im ed th at it c o uld n ot. In 1 868,

Bis m arc k h im se lf w ro te : “ A ll th e a d van ta g es c la im ed f o r th e m oth er c o untr y

are f o r th e m ost p art illu sio ns. E ngla n d is a b an donin g its c o lo nia l p olic y ; s h e

fin ds it to o c o stly .” A nd o th er d efe n ders o f th e s y ste m e ch oed h is re m ark s:

th ey poin te d out th at co lo nie s “d id n’t pay ”; th at co lo niz atio n

was not

underta k en g la d ly , b ut t h at i t w as f o rc ed o n t h e g re at p ow ers b y v ir tu e o f t h eir civ iliz in g m is sio n in th e w orld ; th at c o lo nie s g ain ed m ore th an th e m oth er

co untr y , a n d s o o n.

But th ey sim ply m is se d th e p oin t. T ru e, so m e c o lo nie s d id n ot p ay — in

1865 a C om mitte e o f C om mons a ctu ally re co m men ded th e a b an donm en t o f

all B ritis h h old in gs s a v e o n th e w est c o ast o f A fric a o n th e g ro und th at th ey

were h ig hly u npro fita b le v en tu re s. B ut w hile

all

co lo nie s d id n ot y ie ld a

pro fit,

so m e

c o lo nie s w ere fa b ulo usly re w ard in g: th e te a g ard en s in C ey lo n,

fo r ex am ple , w ould re tu rn 50 perc en t div id en ds on in veste d cap ita l in a

ban ner y ear. A nd w hile

all

in dustr y d id n ot b en efit fro m o vers e as m ark ets ,

so m e

im porta n t in dustr ie s c o uld h ard ly h av e e x is te d w ith out th em : th e c la ssic

case in p oin t is th e d ep en den ce o f th e B ritis h c o tto n in dustr y o n th e In dia n

mark et. A nd f o r E ngla n d a s a w hole , f o re ig n in vestm en t c erta in ly p ro vid ed a

pro fita b le o utle t fo r sa v in gs: b etw een 1 870 an d 1 914,

one-h alf

o f E nglis h

sa v in gs w ere in veste d a b ro ad , a n d th e flo w o f d iv id en ds a n d in te re st fro m

fo re ig n i n vestm en ts p ro vid ed 1 0 p erc en t o f t h e B ritis h n atio nal i n co m e.

To b e s u re , th ere w ere o th er m otiv es g en ero usly m ix ed in w ith th e p ure ly

eco nom ic , an d th e eco nom ic co m pen sa to ry eff e ct o f im peria lis m w as n ot

quite s o s im ple a s J . A . H obso n h ad d esc rib ed it. B ut b y a n d la rg e, o ne c o uld

hard ly fin d a n e x pla n atio n fo r th e th ru st o f E uro pean p ow er in to A fric a a n d

Asia th at d id n ot c o nta in s o m e fla v or o f e co nom ic a d van ta g e. In th e c ase o f

Holla n d, f o r e x am ple , t h e h uge p la n ta tio ns o f J a v a a n d S um atr a o ff e re d a f ie ld

fo r p ro fita b le in vestm en t o f g re at im porta n ce f o r D utc h c ap ita l; in th e c ase o f

Mala y a, in valu ab le an d ch eap ra w m ate ria ls pro vid ed Jo hn B ull w ith a

lu cra tiv e in te rn atio nal m onopoly ; in th e c ase o f th e M id dle E ast, th ere w ere

oil a n d th e s tr a te g ic c o ntr o l o ver s h ip pin g th ro ugh th e S uez C an al. “ W hat o ur

in dustr ie s la ck … w hat th ey la ck m ore a n d m ore , is m ark ets ,” s a id a F re n ch

min is te r in 1 885; an d in 1 926 D r. S ch ach t, th en p re sid en t o f th e G erm an

Reic h sb an k, d ecla re d : “ T he fig ht fo r ra w m ate ria ls p la y s th e m ost im porta n t

ro le in w orld p olitic s, a n e v en g re ate r ro le th an b efo re th e w ar. G erm an y’s

only so lu tio n is

her acq uis itio n o f co lo nie s.” F ro m co untr y to co untr y th e

motiv es m ig ht d if f e r, b ut th e c o m mon d en om in ato r o f e co nom ic g ain w as to

be f o und i n a ll.

Does th is m ean th at im peria lis m is in deed an in se p ara b le part of

cap ita lis m ? T he a n sw er is n ot a s im ple o ne. C erta in ly c ap ita lis m h as b een a n

ex pan siv e sy ste m fro m its e arlie st d ay s, a sy ste m w hose d riv in g fo rc e h as

been th e e ff o rt to a ccu m ula te e v er la rg er a m ounts o f c ap ita l its e lf . T here fo re

fro m e arly o n, w e f in d th at c ap ita lis t f ir m s h av e lo oked to f o re ig n la n ds, b oth

fo r m ark ets an d fo r ch eap ra w m ate ria ls ; an d eq ually im porta n t, th e

govern m en ts o f c ap ita lis t n atio ns h av e u su ally s u pporte d a n d p ro te cte d th eir

priv ate e n te rp ris e rs i n t h ese o vers e as v en tu re s. This m uch o f t h e i m peria lis t s c en ario s e em s b ey ond q uestio n. B ut w e h av e

co m e to lo ok o n th is p ro cess o f c ap ita lis t e x pan sio n in a s o m ew hat d if f e re n t

fa sh io n f ro m th at o f H obso n o r L en in . T he d riv in g f o rc e d oes n ot s e em to b e

lo dged in a p ile u p o f u ndig este d sa v in gs at h om e th at re q uir e in vestm en t

ab ro ad . R ath er, th e underly in g pro puls iv e m ech an is m ap pears to be th e

ex tr a o rd in ary cap acity o f th e cap ita lis t m ode o f eco nom ic o rg an iz atio n to

dis p la ce o th er m odes, a n d to e sta b lis h its e lf in n oncap ita lis t s e ttin gs. T here is

so m eth in g ab out th e te ch nolo gic al orie n ta tio n, th e eff ic ie n cy, th e sh eer

dynam is m o f c ap ita lis t w ay s o f p ro ductio n th at m ak es th e e x pan sio n o f th e

sy ste m “ ir re sis tib le .”

Thus w e te n d to day to se e th e pro cess of im peria lis m as part of

th e

in te rn atio naliz a tio n o f c a pita l

, a p ro cess th at b eg an e v en b efo re c ap ita lis m

was fu lly fo rm ed a n d th at h as n ot y et ru n its c o urs e . B ut h ere a n im porta n t

dis tin ctio n m ust b e m ad e b etw een th e in te rn atio naliz atio ns o f d if f e re n t e ra s.

Im peria lis m o f th e k in d th at h elp ed b rin g o n W orld W ar I w as n ot ju st th e

tr a n sp la n ta tio n o f c ap ita lis t m odes o f p ro ductio n in to A fric a a n d A sia a n d

Latin A m eric a. It w as th is p lu s u ndis g uis e d p olitic al in te rfe re n ce, te rrif ic

ex plo ita tio n, m ilita ry fo rc e, a n d a g en era l d is re g ard fo r th e in te re sts o f th e

poore r n atio ns. W hat is s o s tr ik in g a b out la te n in ete en th - o r e arly tw en tie th -

cen tu ry B ritis h in vestm en t in In dia , fo r e x am ple , is th at it w as la rg ely b ase d

on a n d r u le d b y E ngla n d’s

need s, n ot I n dia ’s r e q uir e m en ts . I n th e c ase o f th e

Belg ia n C ongo o r t h e N eth erla n ds I n die s, “ la rg ely ” c an b e r e ad “ en tir e ly .”

Som e p art o f th is o ld -fa sh io ned im peria lis m r e m ain s, a lth ough its o utw ard

man if e sta tio ns h av e c h an ged . T he S eco nd W orld W ar b ro ught a g en era l e n d

to th e r e la tio nsh ip o f c o lo nia lis m w ith in w hic h th e o ld er e co nom ic h eg em ony

ex erte d its s w ay. W here th ere w ere o nly s u pin e c o lo nie s b efo re th e w ar, th ere

em erg ed in dep en den t n atio ns afte r it; an d alth ough m an y o f th ese n atio ns

were ( a n d s till a re ) im poveris h ed a n d w eak , th eir n atio nal s ta tu s h as m ad e it

im possib le f o r th e E uro pean n atio ns to e x erc is e th e s a m e c av alie r d om in atio n

th at w as c o m monpla ce i n t h e f ir s t h alf o f t h e c en tu ry .

Thin gs h av e b een s o m ew hat d if f e re n t i n t h e c ase o f t h e U nite d S ta te s. H ere

milita ry fo rc e h as b een a p plie d a g ain st u nderd ev elo ped n atio ns m an y tim es

sin ce th e w ar— ag ain st C uba, V ie tn am , N ic ara g ua, an d Ira q am ong oth er

in sta n ces— so th at th e U nite d S ta te s h as in herite d th e u nen via b le title o f th e

main im peria lis t p ow er in th e w orld . B ut th e m otiv es th at h av e p ro m pte d o ur

im peria lis t ad ven tu re s are n ot th ose th at se n t th e M arin es in to th e b an an a

re p ublic or th e gunboats in to C hin a in th e nin ete en th cen tu ry . It is not

Am eric an p ro perty th at w e h av e b een p ro te ctin g, b ut A m eric an id eo lo gy.

Rath er lik e th e E nglis h d urin g th e p erio d o f th e F re n ch R ev olu tio n, u ntil th e

Sovie t deb acle our govern m en t fe lt its e lf th re ate n ed by an im men se re v olu tio nary f o rc e— th e f o rc e o f w orld w id e c o m munis m , w hose m ost lik ely

re cru its s e em ed to b e th e f ra il a n d u nsta b le n atio ns o f th e T hir d W orld . A s a

re su lt, w e h av e r e acte d t o n early e v ery s o cia lis t t e n den cy i n t h ose n atio ns a s i f

it w ere th e e n te rin g w ed ge o f a fo re ig n-d om in ate d C om munis t re g im e, a n d

hav e s u pporte d e v ery re actio nary g overn m en t in th ose n atio ns a s p art o f th e

sa m e s tr u ggle a g ain st c o m munis m .

How t h is d efe n siv e-m in ded , a g gre ssiv e-o rie n te d p olic y w ill e n d r e m ain s t o

be s e en . P erh ap s th e U nite d S ta te s w ill b e a b le to m ain ta in a w orld s a fe fo r

cap ita lis m by brin gin g eco nom ic or m ilita ry fo rc e to bear on so cia lis t

govern m en ts th at a p pear in th e u nderd ev elo ped w orld . P erh ap s s u ch a

polic y

will e n d in o ur o w n fru str a tio n a n d d em ora liz atio n. W hate v er th e o utc o m e,

how ev er, th is a sp ect o f im peria lis m b ears m ore re la tio n to th e p ro ble m o f

pro te ctin g a g re at k in gdom f ro m th e in flu en ce o f o uts id ers — a p ro ble m a s o ld

as a n cie n t C hin a o r R om e— th an to th e d ir e ct s u pport f o r b usin ess e n te rp ris e s

th at w as th e fra n k m otiv e fo r th e im peria l th ru st o f th e la st c en tu ry . It is a

dir e ct p olitic al, r a th er t h an a n i n dir e ct e co nom ic , f o rm o f f o re ig n d om in atio n.

Mean w hile , th ere is a s e co nd a sp ect to th e c h an gin g fa ce o f im peria lis m

th at is unm is ta k ab ly eco nom ic . It is th e sp ecta cu la r em erg en ce of th e

multin atio nal co rp ora tio n as th e p rin cip al ag en cy b y w hic h cap ita l m oves

fro m i ts h om e c o untr y o vers e as.

The m ultin atio nals are gia n t co rp ora tio ns, su ch as C oca-C ola , IB M ,

Mic ro so ft, an d R oyal D utc h Shell, w hose m an ufa ctu rin g or pro cessin g

opera tio ns a re l o cate d i n m an y n atio ns. A m ultin atio nal w ill d rill f o r o il i n t h e

Mid dle E ast o r A fric a, r e fin e it in E uro pe o r A m eric a, a n d s e ll it in J a p an ; o r

it m ay ex tr a ct o re in A ustr a lia , p ro cess it in Ja p an , an d sh ip th e fin is h ed

beam s t o t h e U nite d S ta te s.

Multin atio nals h av e b ro ught t w o c h an ges t o t h e o vera ll i n te rn atio naliz atio n

of c ap ita l. F ir s t, t h ey h av e c h an ged i ts g eo gra p hic f lo w s. I n t h e d ay s o f c la ssic

im peria lis m , as w e hav e se en , th e obje ctiv e of cap ita lis t ex pan sio n w as

fo cu se d m ain ly o n g ain in g a ccess to ra w m ate ria ls o r to m ark ets fo r b asic

co m moditie s, lik e te x tile s. T he m ultin atio nals h av e tu rn ed a w ay fro m th ese

basic c o m moditie s to w ard th e s o rts o f h ig h-te ch nolo gy g oods in w hic h th ey

are w orld le ad ers , su ch as co m pute rs an d p harm aceu tic als . T he re su lt h as

been a s tr ik in g s h if t in th e o vers e as a llo catio n o f c ap ita l. I n 1 897 a lm ost h alf

of A m eric an o vers e as c ap ita l w as in veste d in p la n ta tio ns, r a ilw ay s, o r m in in g

pro pertie s. T oday o nly a s m all fra ctio n o f o ur fo re ig n in vestm en t is in th ose

fie ld s. I n ste ad , t h e b ulk o f o ur o vers e as c ap ita l h as m oved i n to m an ufa ctu rin g,

an d th re e-q uarte rs o f th e f lo w o f in te rn atio nal in vestm en t g oes to E uro pe a n d

Can ad a a n d o th er d ev elo ped c ap ita lis t la n ds. S o, to o, th e g re at p re p ondera n ce

of F re n ch o r J a p an ese o r G erm an in te rn atio nal in vestm en t s e ek s o ut lo catio ns in th e d ev elo ped w orld (in clu din g th e U nite d S ta te s), ra th er th an in th e o ld

co lo nia l p arts o f t h e g lo be.

A s e co nd e co nom ic c o nse q uen ce o f th e r is e o f th e m ultin atio nals h as b een

th eir r e m ark ab le a b ility t o c o m bin e h ig h t e ch nolo gy w ith c h eap a n d u ntr a in ed

la b or. The in cre d ib ly co m plic ate d mech an is m s th at underlie modern

eco nom ic lif e , su ch as co m pute r p arts o r te le v is io n su basse m blie s, can b e

pro duced in th e H ong K ongs a n d S outh K ore as a n d T haila n ds o f th e w orld ,

usin g sc ie n tif ic m ach in es o pera te d b y m en an d w om en ju st o ff th e p ad dy

fie ld s. Fro m th e poin t of vie w of im peria lis m , th e upsh ot of th is is a

perp le x in g o ne. T he ab ility to tr a n sp la n t w hole p ro ductio n p ro cesse s in to

are as o f th e w orld th at o nly y este rd ay w ere p easa n t e co nom ie s h as s u cceed ed

to a n u npre ced en te d d eg re e in e x portin g th e s o cia l in stitu tio ns o f c ap ita lis m .

Ju st as th e fa cto rs o f p ro ductio n th em se lv es em erg ed fro m a p re cap ita lis t

so cia l se ttin g durin g th e gre at eco nom ic re v olu tio n w e w itn esse d in our

open in g c h ap te rs , s o in o ur tim es a n ew e co nom ic re v olu tio n is b rin gin g th e

mark et eco nom y in to re g io ns th at w ere fo rm erly o nly p assiv e, n ot activ e

fo rc es in th e w orld e co nom y. T o th at e x te n t, m odern im peria lis m h as b een a

gre at f o rc e f o r t h e v ita liz atio n o f c ap ita lis m a b ro ad .

At th e sa m e tim e, th e new im peria lis m has gre atly in te n sif ie d th e

co m petitiv en ess o f th e s y ste m in its d ev elo ped h om ela n ds. T his is n ot o nly

th e re su lt o f th e in te rp en etr a tio n o f e ach o th er’s m ark ets th at w e d is c u sse d

ab ove, b ut b ecau se th e m an ufa ctu rin g o utp osts o f th e m ultin atio nals in th e

underd ev elo ped re g io ns c an fir e a rtille ry b arra g es o f lo w -c o st c o m moditie s

back i n to t h eir m oth erla n ds. A s n o n atio n k now s b ette r t h an t h e U nite d S ta te s,

TV s e ts m ad e in H ong K ong o r T aiw an , o r a u to m obile s m ad e in S outh K ore a

or a sse m ble d i n M ex ic o , c an e asily u nders e ll t h e s a m e p ro ducts m an ufa ctu re d

in C alif o rn ia o r t h e M id w est.

It is to o s o on to fo re te ll th e c o nse q uen ces o f th is in te rn atio naliz atio n a n d

in te n sif ic atio n o f c o m petitio n o r w hat m ay b e th e o utc o m e o f th e fin an cia l

an d p olitic al c ris e s th at h av e a p peare d — not su rp ris in gly — in n early a ll th e

Asia n “tig ers .” W hat se em s b ey ond d oubt is th at w e h av e m oved in th e

dir e ctio n o f a g lo bal eco nom y in w hic h n ew w orld -s tr a d dlin g

en te rp ris e s

co ex is t u neasily w ith o ld er n atio nal b oundarie s an d p re ro gativ es. It is an

ir o nic en din g to o ur co nsid era tio n o f th e p ro ble m o f im peria lis m th at th e

movem en t w hose o rig in s w ere c o nnecte d w ith a lle v ia tin g th e p re ssu re s o n

cap ita l h as e n ded u p b y m ak in g t h em w ors e .

Jo hn H obso n d ie d in 1 940; in th e L ondon

Tim es

a p ro perly c ir c u m sp ect

obitu ary duly note d both his pre sc ie n t id eas an d his la ck of gen era l

re co gnitio n.

For u nre co gniz ed h e w as. T he m ost r e n ow ned e co nom is t o f th e V ic to ria n world was an eco nom is t utte rly unlik e Hobso n: Alf re d M ars h all— as

co nsid ere d , m id dle -o f-th e-ro ad , a n d “ o ff ic ia l” a s H obso n h ad b een in tu itiv e,

ex tr e m e, a n d, s o to s p eak , u nau th oriz ed . Y et it is f ittin g th at w e c o nclu de th is

jo urn ey th ro ugh th e s h ad ow y r e g io ns o f th e u nderw orld b y r e tu rn in g a g ain to

Vic to ria n d ay lig ht. T he e co nom is ts w ho w ork ed in th at d ay lig ht m ig ht n ot

hav e s e en th e d is tu rb in g s ig hts r e v eale d to m ore a d ven tu ro us s o uls , b ut th ey

did o ne th in g th at th e h ere tic s d id n ot: th ey ta u ght th eir w orld — an d e v en o ur

world — its “ eco nom ic s.”

Mere ly t o l o ok a t A lf re d M ars h all’s p ortr a it i s a lr e ad y t o s e e t h e s te re o ty pe

of th e te ach er: w hite m usta ch e, w hite w is p y hair , kin d brig ht ey es— an

em in en tly p ro fe sso ria l c o unte n an ce. A t th e tim e o f h is d eath in 1 924, w hen

th e g re ate st e co nom is ts in E ngla n d p aid h om ag e to h is m em ory , o ne o f th em ,

Pro fe sso r C . R . F ay, p ro duced t h is i n delib le p ortr a it o f t h e V ic to ria n p ro fe sso r

ch ez l u i:

Pig ou to ld m e I o ught to g o a n d se e h im a b out a su bje ct fo r a F ello w sh ip

Dis se rta tio n. S o one afte rn oon to w ard s tw ilig ht I w en t to B allio l C ro ft.

“C om e i n , c o m e i n ,” h e s a id , r u nnin g i n f ro m a l ittle p assa g e; a n d I w en t w ith

him u psta ir s . “ H av e y ou a n y id ea w hat to d o?” h e a sk ed m e. I sa id “ n o.”

“W ell, th en , lis te n ,” h e s a id , p ro ducin g a s m all b la ck b ook. H e p ro ceed ed to

re ad o ut a lis t o f s u bje cts h av in g p re v io usly o rd ere d m e to h old u p m y h an d

when h e c am e to o ne I lik ed . I n m y n erv ousn ess I tr ie d to c lo se w ith th e f ir s t

su bje ct, b ut M ars h all to ok n o n otic e a n d r e ad o n. A bout h alf w ay th ro ugh th e

se co nd

pag e h e arriv ed at “T he R ecen t G erm an F in an cia l C ris is .” H av in g

been to G re if s w ald fo r a s u m mer I s ig nale d a cq uie sc en ce. “ It w ould n’t s u it

you a t a ll,” h e s a id . I k ep t q uie t fo r a n oth er fiv e m in ute s, a n d, c atc h in g th e

word “ A rg en tin e” m ad e a n oth er n ois e w hic h sto pped h im . M y o nly re aso n

was th at tw o o f m y u ncle s h ad b een in b usin ess th ere . “ H av e y ou b een th ere

yours e lf ? ” h e a sk ed . “ N o,” I r e p lie d , a n d h e w en t o n. A f e w m om en ts l a te r h e

sto pped a n d sa id , “ H av e y ou fo und a su bje ct y ou lik e?” “ I d on’t k now ,” I

beg an . “ N o o ne e v er d oes,” h e s a id , “ b ut t h at’s m y m eth od. N ow , w hat w ould

you lik e to d o?” I g asp ed o ut “ a c o m paris o n o f G erm an a n d E nglis h la b our.”

Upon w hic h ( fo r it w as n ow q uite d ark ), h e p ro duced a little la n te rn w ith a n

ele ctr ic b utto n a n d b eg an p ro w lin g a ro und th e s h elv es, h an din g o ut b ooks in

Englis h a n d G erm an — von N ostitz , K uhlm an , a b out 3 0 i n a ll. “ N ow ,” h e s a id ,

“I’ll l e av e y ou t o s m ell; w hen y ou’v e f in is h ed , b lo w d ow n t h e t u be a n d S ara h

will b rin g y ou s o m e t e a.”

It w as a ll v ery r e m ote f ro m t h e A fric an s tr if e t h at h ad d is tu rb ed H obso n o r

th e bois te ro us Am eric an sp ecu la tio n th at had fo rm ed th e cra d le of

en vir o nm en t fo r H en ry G eo rg e’s id eas. M ars h all, lik e his co nte m pora ry

Edgew orth , w as pre em in en tly th e pro duct of a univ ers ity . A lth ough he voyag ed to A m eric a a n d e v en a cro ss A m eric a to S an F ra n cis c o , h is lif e , h is

poin t o f v ie w — an d in ev ita b ly h is e co nom ic s— sm ack ed o f th e q uie tu de a n d

re fin em en t o f t h e C am brid ge s e ttin g.

But ex actly w hat d id h e te ach ? T he w ord to su m u p M ars h all’s b asic

co ncern is th e te rm w e h av e a lr e ad y id en tif ie d a s th e n ew V ic to ria n v is io n o f

th e eco nom y— th e te rm “eq uilib riu m .” In co ntr a st w ith B astia t, w ho w as

dra w n t o t h e i r ra tio nalitie s o f e co nom ic s o phis tr y , o r w ith H en ry G eo rg e, w ho

sa w th e in ju stic es o f lif e c lo ak ed w ith e co nom ic sa n ctio n, o r w ith H obso n,

who lo oked f o r h id den d estr u ctiv e te n den cie s in th e im pers o nal p ro cesse s o f

cap ita lis t e co nom ic s, M ars h all w as p rim arily in te re ste d in th e s e lf -a d ju stin g,

se lf -c o rre ctin g n atu re o f t h e e co nom ic w orld . A s h is m ost b rillia n t p upil,

J. M .

Key nes, w ould la te r w rite , h e c re ate d “ a w hole C opern ic an s y ste m , in w hic h

all th e e le m en ts o f th e e co nom ic u niv ers e a re k ep t in th eir p la ces b y m utu al

co unte rp ois e a n d i n te ra ctio n.”

Much o f th is , o f c o urs e , h ad b een ta u ght b efo re . A dam S m ith , R ic ard o,

Mill, h ad a ll e x pounded th e m ark et s y ste m a s a f e ed back m ech an is m o f g re at

co m ple x ity an d eff ic ie n cy. Y et betw een th e overa ll vis io n an d th e fin e

work in g-o ut of deta ils , th ere w as m uch unex plo re d te rrito ry an d fo ggy

ex positio n: th e th eo ry o f m ark et e q uilib riu m w hic h M ars h all in herite d w as a

good d eal m ore im posin g a t a d is ta n ce th an u p c lo se . T here w ere s tic k y b its

ev en a b out s u ch b asic m atte rs a s w heth er p ric es w ere r e ally a r e fle ctio n o f t h e

co st o f p ro ductio n o f a g ood, o r o f th e f in al d eg re e o f s a tis fa ctio n y ie ld ed b y

th at g ood— were d ia m onds h ig h-p ric ed , in o th er w ord s, b ecau se th ey w ere

hard t o f in d o r b ecau se p eo ple e n jo yed w earin g t h em ? P erh ap s s u ch q uestio ns

would n ot m ak e a n y b ut a n e co nom is t’s h eart b eat fa ste r, a n d y et a s lo ng a s

th ey r e m ain ed o bsc u re it w as h ard to th in k c le arly a b out m an y p ro ble m s th at

eco nom ic s s o ught t o a tta ck .

It w as to th ese fu zzy q uestio ns o f e co nom ic th eo ry th at M ars h all a p plie d

him se lf . In his fa m ous

Prin cip le s of E co nom ic s

he co m bin ed a m in d of

math em atic al pre cis io n w ith a sty le th at w as le is u re ly , dis c u rs iv e, sh ot

th ro ugh w ith h om ely e x am ple , a n d w onderfu lly lu cid . E ven a b usin essm an

co uld u nders ta n d

th is

s o rt o f e co nom ic s, fo r a ll th e h ard lo gic al p ro ofs w ere

th oughtf u lly re le g ate d to th e fo otn ote s (w ith th e re su lt th at Key nes

ir re v ere n tly s a id th at a n y e co nom is t w ould d o b ette r to r e ad th e f o otn ote s a n d

fo rg et th e te x t th an v ic e v ers a ). A t an y ra te , th e b ook w as a tr e m en dous

su ccess; o rig in ally p ublis h ed in 1 890, it is s till p re sc rib ed f a re f o r th e s tu den t

who a sp ir e s t o b e a n e co nom is t.

And w hat w as th e g re at c o ntr ib utio n o f M ars h all to th e c o ncep tu al ta n gle s

of e co nom ic s? T he m ain c o ntr ib utio n— th e o ne to w hic h M ars h all h im se lf

re tu rn ed tim e a n d a g ain — was th e in sis te n ce o n th e im porta n ce o f

tim e

a s th e quin te sse n tia l e le m en t i n t h e w ork in g-o ut o f t h e e q uilib riu m p ro cess.

For eq uilib riu m , as M ars h all poin te d out, ch an ged its

basic m ean in g

acco rd in g to w heth er th e a d ju stm en t p ro cess o f th e e co nom y to ok p la ce in a

sh ort- ru n o r a lo ng-ru n p erio d. In th e sh ort ru n, b uyers a n d se lle rs m et to

hig gle on th e m ark etp la ce, but basic ally th e barg ain in g pro cess re v olv ed

ab out a fix ed q uan tity o f g oods— th e d ia m onds th at th e d ia m ond m erc h an ts

bro ught a lo ng w ith th em in th eir s u itc ase s. O ver th e lo nger r u n, h ow ev er, th e

quan tity of dia m onds w as not fix ed . N ew m in es co uld be open ed if th e

dem an d warra n te d it; old m in es co uld be ab an doned if su pply was

su pera b undan t. H en ce in th e very sh ort ru n it w as th e psy ch ic utility of

dia m onds— th at is , th e dem an d fo r th em — whic h ex erc is e d th e m ore

im med ia te in flu en ce o n th eir m ark et p ric e; b ut o ver th e lo n g ru n, as th e

re cu rrin g f lo w o f s u pply w as a d ju ste d t o c o nsu m ers ’ w an ts , c o st o f p ro ductio n

ag ain a sse rte d i ts u pper h an d. N eith er c o st n or u tility , o f c o urs e , c o uld e v er b e

quite div orc ed fro m th e dete rm in atio n of pric e; dem an d an d su pply , in

Mars h all’s o w n w ord s, w ere lik e “ th e b la d es o f a p air o f s c is so rs ,” a n d it w as

as fru itle ss to a sk w heth er s u pply o r d em an d a lo ne re g ula te d p ric e a s to a sk

wheth er th e u pper o r lo w er b la d e o f th e s c is so rs d id a ll th e c u ttin g. B ut w hile

both b la d es c u t, o ne o f th em , s o to s p eak , w as th e a ctiv e a n d o ne th e p assiv e

ed ge— th e u tility -d em an d e d ge a ctiv e w hen th e c u t to ok p la ce in th e q uic k

tim e s p an o f th e g iv en m ark et; th e c o st- s u pply e d ge a ctiv e w hen th e c u ttin g

ex te n ded o ver th e lo nger p erio d in w hic h sc ale s o f o utp ut a n d p atte rn s o f

pro ductio n w ere s u bje ct t o c h an ge.

It w as, lik e ev ery th in g M ars h all to uch ed w ith his an aly tic m in d, an

illu m in atin g in sig ht. A nd y et m ore th an th eo re tic al b rillia n ce ra d ia te d fro m

th e

Prin cip le s

. If M ars h all w as th e fin est in te llig en ce o f th e “ o ff ic ia l” w orld

of e co nom ic s, h e w as a ls o its m ost c o m passio nate in te llig en ce. A g en uin e

co ncern fo r th e la b orin g p oor, fo r th e “ crin gin g w re tc h es” h e n ote d o n h is

tr ip s to th e L ondon s lu m s, f o r e co nom ic s a s a to ol f o r s o cia l b ette rm en t— all

th is w as in ex tr ic ab ly w oven in to h is b ook. S o, to o, it s h ould b e n ote d , w as a n

ap pra is a l o f th e fu tu re th at c au tio ned a g ain st su ccu m bin g to th e “ b eau tif u l

pic tu re s o f lif e , as it m ig ht b e u nder in stitu tio ns w hic h [th e im ag in atio n]

co nstr u cts easily ,” co uple d w ith h opes th at

th e attitu des of th e ric h w ere

cap ab le o f tu rn in g to w ard “ ch iv alr y ,” to “ h elp th e ta x -g ath ere r … r e m ove th e

wors t e v ils o f p overty f ro m t h e l a n d.”

We sm ile at th ese V ic to ria n se n tim en ts , b ut th ey d o n ot co nstitu te th e

asp ect o f M ars h all’s v is io n th at m ad e its g re ate st im prin t o n e co nom ic s its e lf .

For t h at w e t u rn t o t h e f ro nt o f t h e P rin cip le s, w here t w o d ecla ra tio ns m eet t h e

ey e. T he fir s t is a ty pic ally ch arm in g M ars h allia n passa g e desc rib in g an

in div id ual w eig hin g th e p le asu re s to b e r e ceiv ed f ro m a p urc h ase a g ain st th e lo ss o f p le asu re t h at t h e e x pen ditu re w ill e n ta il:

A r ic h m an , i n d oubt w heth er t o s p en d a s h illin g o n a s in gle c ig ar, i s w eig hin g

ag ain st one an oth er sm alle r ple asu re s th an a poor m an , w ho is doubtin g

wheth er to sp en d a sh illin g o n a su pply o f to bacco th at w ill la st h im fo r a

month . T he c le rk w ith £ 100 a y ear w ill w alk to w ork in a m uch h eav ie r r a in

th an t h e c le rk w ith £ 300 a y ear.

The se co nd sta te m en t co m es a fe w pag es la te r, w here M ars h all is

dis c u ssin g t h e p urp ose o f e co nom ic s. I t i s , h e s a y s,

a stu dy o f th e eco nom ic m ean s an d asp ects o f m an ’s p olitic al, so cia l an d

priv ate lif e ; b ut m ore e sp ecia lly o f h is s o cia l lif e … . It s h uns m an y p olitic al

is su es, w hic h th e p ra ctic al m an c an not ig nore … a n d it is th ere fo re … b ette r

desc rib ed by th e bro ad te rm “E co nom ic s” th an by th e narro w er te rm

“P olitic al E co nom y.”

Tw o th in gs a re n ote w orth y in th ese se em in gly in nocu ous p assa g es. T he

fir s t, b rillia n tly re aliz ed in th e c le rk d ecid in g w heth er o r n ot to sp en d th e

money to ta k e a c ab , is n oth in g le ss th an a n ew f ig ure w ho w ill e p ito m iz e th e

Mars h allia n v is io n o f t h e e co nom y a s a p tly a s, i f m uch l e ss d ra m atic ally t h an ,

th e g re at m onarc h o f th e H obbesia n e ra . T he n ew fig ure is T he In div id ual,

whose c alc u la tio ns n ot o nly s y m boliz e t h e w ork in gs o f t h e m ark et s y ste m , b ut

are in f a ct th e r o ck o n w hic h th e e co nom y its e lf u ltim ate ly r e sts . G one is th e

vis io n

of e co nom ic s a s th e s tu dy o f th e s o cia l d ynam ic s o f M onarc h y o r o f a

Sm ith ia n S ocie ty , n ot to m en tio n M arx ia n c la ss w arfa re . I n its p la ce w e h av e

eco nom ic s a s e x plic atio n o f th e c o lle ctiv e lif e o f th e in div id ual, w hic h is to

sa y, o f e v ery one f o r h im - o r h ers e lf .

In tim ate ly t ie d t o t h is i s a n oth er c h an ge, i m plic it i n t h e s e co nd q uota tio n. I t

is th e d is a p peara n ce o f a th em e th at w as u nab ash ed ly a c en tr a l p art o f e arlie r

vis io ns— nam ely , th e politic al co nte n t of eco nom ic s. M ars h all se es th e

purp ose o f e co nom ic s a s e x pla in in g s u ch q uestio ns a s h ow e q uilib riu m p ric es

are a rriv ed a t, n ot th e u nderly in g q uestio n o f h ow th e r e la tio ns o f p ow er a n d

obed ie n ce th at g iv e s tr u ctu re to a ll s tr a tif ie d s o cie tie s a ris e in a s o cia l o rd er

perc eiv ed a s j u st a c o lle ctio n o f i n div id uals e ach s e ek in g h is o r h er “ u tility .”

Why th is c u rio us tu rn in g a w ay f ro m

politic a l

e co nom y? T w o p ossib ilitie s

sp rin g t o m in d. T he f ir s t i s t h at t h e e v en ts o f 1 848, a n d p erh ap s t h e i n cre asin g

flo w o f s o cia lis tic i d eas, m ad e a n e x plic it r e co gnitio n, m uch l e ss e x am in atio n,

of p ow er a n d o bed ie n ce m uch m ore c o nte n tio us th an it w ould h av e b een in

Sm ith ’s o r M ill’s tim es, w hen s u ch s o cia l r e la tio ns w ere ta k en f o r g ra n te d . A

se co nd, q uite c o ntr a ry , p ossib ility i s t h at t h e g ra d ual a ccep ta n ce o f d em ocra tic

id eas d urin g th e n in ete en th c en tu ry g av e th e M ars h allia n v is io n a p la u sib ility

it w ould n ot h av e e n jo yed i n e arlie r t im es. That is a q uestio n w e can ra is e , b ut n ot re so lv e. A ll w e can sa y w ith

certa in ty is th at E co nom ic s n ow ta k es th e p la ce o f P olitic al E co nom y; a n d a

new c h ap te r o f e co nom ic s b eg in s. A ll t h is w ill b eco m e i n cre asin gly i m porta n t

as o ur stu dy m oves to w ard th e p re se n t. B ut th ere is o ne la st m atte r th at

dese rv es a w ord . I t c o ncern s th e v ery e le m en t o f M ars h all’s a n aly sis th at w as

his m ost im porta n t g if t to e co nom ic a n aly sis — th e e le m en t o f tim e. F or tim e,

to M ars h all, w as a b str a ct tim e; it w as th e tim e in w hic h m ath em atic al c u rv es

ex fo lia te a n d t h eo re tic al e x perim en ts m ay b e r u n a n d r e ru n, b ut i t w as n ot t h e

tim e i n w hic h a n yth in g e v er r e ally

happen s

. T hat i s , i t w as n ot t h e i r re v ers ib le

flo w o f h is to ric tim e— an d, a b ove a ll, n ot

th e

h is to ric tim e in w hic h M ars h all

him se lf liv ed . T hin k fo r a m om en t of w hat he liv ed to se e: a vio le n t

an tic ap ita lis t

re v olu tio n in R ussia , a w orld -e n co m passin g w ar, th e fir s t

ru m blin gs o f a n tic o lo nia lis m . T hin k o f w hat la y ju st a h ead : th e d eclin e o f

cap ita lis m in m uch of E uro pe, a w orld w id e ch an ge in th e co ncep tio n of

govern m en t, a w orld -s h ak in g d ep re ssio n in th e U nite d S ta te s. Y et, o f th e

re le v an ce o f e co nom ic s to a ll th ese o verw helm in g c h an ges, n eith er A lf re d

Mars h all n or s till le ss h is o ff ic ia l c o lle ag ues h ad m uch , if a n y, u nders ta n din g.

Natu ra n on fa cit s a ltu m

—natu re m ak es n o s u dden le ap s— was th e m otto o f

th e

Prin cip le s

in its la st e d itio n in 1 920, a s it h ad b een in its fir s t, in 1 890.

The fa ct th at h is to ry m ig ht m ak e s u dden le ap s, th at th e w orld o f e co nom ic s

mig ht b e in se p ara b ly tie d to th e w orld o f h is to ry , th at th e lo ng a n d s h ort r u n

of th e te x tb ook im plie d a to ta lly d if f e re n t c o ncep tio n o f “ tim e” fro m th at o f

th e re le n tle ss tic k in g o f th e s o cia l c lo ck — all th is w as fa r re m oved fro m th e

notio ns of eq uilib riu m w hic h M ars h all m ad e th e cen te r of his eco nom ic

in quir y . F or n oth in g th at h e s a id c o uld h e b e r e p ro ach ed , f o r h e w as a m an o f

gen tle f a ith a n d d eep ly f e lt c o nvic tio ns. T he tr o uble w as th at n oth in g h e s a id

wen t f a r e n ough.

And e v en th is m ig ht b e c o ndoned in h in dsig ht w ere it n ot fo r o ne th in g.

All th e w hile th at M ars h all a n d h is c o lle ag ues w ere re fin in g th eir d elic ate

mech an is m o f e q uilib riu m , a f e w u north odox d is se n te rs w ere in sis tin g th at it

was n ot e q uilib riu m b ut c h an ge— vio le n t c h an ge— th at c h ara cte riz ed th e r e al

world an d pro perly fo rm ed th e su bje ct fo r eco nom ic in quir y . W ar an d

re v olu tio n a n d d ep re ssio n a n d so cia l te n sio n w ere to th eir m in ds th e b asic

pro ble m s fo r e co nom ic s c ru tin y— not e q uilib riu m a n d th e n ic e p ro cesse s o f

ad ju stm en t of a sta b le te x tb ook so cie ty . B ut w hen th e here tic s an d th e

am ate u rs poin te d th is out to Vic to ria n acad em ic off ic ia ld om , th eir

in te rru ptio ns w ere r e se n te d , th eir w arn in gs s h ru gged a sid e, th eir p re sc rip tio ns

sc o rn ed .

The co m pla cen cy of th e off ic ia l world was not m ere ly a ru efu l

co m men ta ry o n th e tim es; it w as a n in te lle ctu al tr a g ed y o f th e f ir s t o rd er. F or

had th e a cad em ic ia n s p aid a tte n tio n to th e u nderw orld , h ad A lf re d M ars h all posse sse d t h e d is tu rb in g v is io n o f a H obso n o r E dgew orth , t h e s e n se o f s o cia l

wro ng o f a H en ry G eo rg e, th e g re at cata str o phe o f th e tw en tie th cen tu ry

mig ht not hav e burs t upon a w orld utte rly

unpre p are d fo r ra d ic al so cia l

ch an ge. It te ach es us, in re tr o sp ect, th at id eas, how ev er here tic al, can not

sa fe ly b e ig nore d — le ast o f a ll b y th ose w hose in te re sts a re , in th e b est s e n se

of t h at m is u se d w ord , c o nse rv ativ e.