the structure and laws of society has been and will continue to be of great value in helping the public to treat more broadly the great questions of social policy. The chief objection to these policies of social legislation comes from two diametrically opposite groups. On the one hand, there are the "standpatters," and on the other, the extreme socialists and the group known as the syndicalists, industrial trade unionists, in our country best represented by the Industrial Workers of the World. The standpatter, so-called, opposes these measures because he does not consider that any material change in the industrial or political order of things is urgently necessary. He believes that on the whole satisfactory progress is being made in the increase of the social product and in its distribution. He invokes once more the economic theory of laissez faire and the political philosophy of the eighteenth century. In our country, unfortunately, honest conservatism is not unfrequently linked with crooked privilege and criminal politics. The alliance of conservatism with graft and privilege has made its position strong from one point of view and vulnerable from another. In so far as corrupt methods may be successfully employed, this alliance has strengthened conservatism, but in so far as the moral sense of the community has revolted against corrupt practices in the public service, and has tended to associate conservatism and corruption, its general position has been greatly weakened. Certain socialistic writers have attacked the present plan of social reform in Germany, England, and the United States on the ground that they are not fundamental but superficial. They have declared, as Mr. Walling does in his volume on Socialism as It Is, that the purpose and effect of these measures will be to preserve capitalism as it is, to maintain the system in a better and more human form, but nevertheless to continue the so-called capitalistic scheme fundamentally undisturbed. They have argued that these plans as thus far worked out involve nothing more than a highly intelligent efficiency system on the patriarchal basis, and while they have not directly opposed these measures, they have not regarded them as fundamental or as final. Mr. Walling has been particularly bitter in his attacks upon this whole policy. He denounces what he calls the "capitalistic reform program" and the activities of the so-called revisionists, reformers, and German Social Democrats of the Berger type. "The new reform programs," says he, "however radical, are aimed at regenerating capitalism, and the net result will be to establish another form of economic fedualism, patriarchism, or paternalism." Quoting another writer, he says: "The new feudalism will care for and conserve the powers of the human industrial tool as the lord of the manor looked after the human agricultural implement." The so-called syndicalists, on the other hand, prefer “direct” methods to political methods. They repudiate parliamentary and political action and prefer such methods as the general strike and sabotage.1 Certain of their leaders denounce not only reform but state socialism and democracy itself. They regard as one of their chief objects the abolition of the state. The syndicalist distrusts the state and believes that political forms and institutions have outlived their usefulness and cannot be adapted to new social relations. No one can of course predict what the final form or effect of these various measures of social policy will be. For our purposes it is sufficient to point out the enormous development of rational social legislation in the United States in recent times. It is adequate for this immediate purpose to show the pronounced change in economic and political theory and the altered attitude of the public mind as evidenced in party platform and in practical legislation as well. It is sufficient to show that during the last fifty years these great changes have been wrought. It is safe to assume that during the next generation the conscious rational treatment of social and industrial problems by society acting through its organized governmental agencies will continue in increasing measure. This is likely to develop most rapidly in cities, but will characterize both state and national activity, and it is not at all impossible that under our constitutional system the national government may lead the way in policies of this nature. The cramped consti * See W. E. Walling, Socialism as It Is, chap. v; Louis Levine, "The Standpoint of Syndicalism,” Annals of the American Academy of Social and Political Science, XLIV, 114. tutional situation of the state compared with the powerful situation of the nation may prove decisive. The practical question is whether these changes shall be made scientifically, wisely, and with sufficient deliberation to insure the maintenance of the social equilibrium, or whether they will be made ignorantly, rashly, and with the blind fury that characterizes revolutionary movements. The mutterings and rumblings of discontent are a warning that changes must come and that the real choice lies, not between change and no change, but between rational and gradual change on the one hand, and sudden and revolutionary change on the other. THE BACKGROUND OF ECONOMIC THEORIES' SIMON N. PATTEN It is a weakness of economics that the social ideas upon which its theories rest have been neglected. Economic theories have been put forward as though they depended solely upon physical or objective conditions. This view obscures the relation between economic theory and the epochs in which it originated; it makes what really is of class origin appear as though it were a necessary element of human nature. To understand its development the history of economic thought must be divided into three epochs, which may be designated as the epoch of 1776, that of 1848, and that of 1912. The social thought of the first epoch brought out the elements in human nature and in objective conditions that contributed to the harmony of interest. The early economists thus emphasized general laws, and were optimistic in tone. This epoch ends in 1848 with the revolution by which it became well known. To understand the new group of writers which now appears, the political and social development of the time must be reviewed. The group to which Adam Smith belonged had influenced public opinion in England and on the Continent; by it a radical, or at least a liberal, viewpoint had been created. As a result, however, of the Napoleonic wars, a definite reaction began in all Europe which has its basis in the thought that social progress had been too rapid, and that either a reaction was necessary or at least a considerable halt should be made before new progress was undertaken. This made the thought of 1848 either revolutionary or reactionary. One group of thinkers contended that progress had been too slow and hence should be accelerated by a revolution, while the other group regarded the forward movement as too rapid and hence thought that in some way it should be checked. A representative of this English reaction is Carlisle. In Germany the movement associated From Proceedings of the American Sociological Society. with Bismarck had the same ideal and end. The best representative of the revolutionary movement is Karl Marx, since from his writings the revolutionary socialism of recent years has taken its origin. It is not my purpose to discuss in full the views of either group of thinkers. The contrast, however, is definite and has constituted the basis for discussion during the last sixty years. The most influential representative of this epoch is John Stuart Mill, whose position therefore needs attention. Mill was as revolutionary in his ideas as was Karl Marx, and one of his essays of this epoch is a Defense of the Revolution of 1848. Mill, however, was not consistent in his position. When he wrote his Political Economy he was reactionary in production and revolutionary in distribution. To make this clear, the attitude of Adam Smith must be contrasted with that of Mill. Smith regarded production as varying with quantities of labor, and thought that improvements in production were connected with the improvements in the condition of the laboring class. Mill's emphasis in production is not on labor but on capital. Hence he views the progress of society, not in connection with the changes in the laboring class, but rather with the accumulation of wealth. From standards of labor to standards of capital there is an evident reaction, because capital appeals to many fewer motives than do the incentives to labor. It is also a class appeal. Relatively few are aroused by the motives for saving; the great mass of people contribute to production only through their labor. It is equally clear that Mill expected a revolution to take place in the distribution of wealth. At the present time, most economists neglect the first ten chapters of Mill's Theory of Distribution and spend their time analyzing the next five. There is, however, a reason why Mill discussed the distribution of property and emphasized it more than he did the distribution of income. Whenever he speaks of the distribution of property, he always speaks of it with some limitation, as "under the present time conditions," or "for the time being." He anticipated that at no distant date radical legislation would alter materially the property distribution then prevailing in England. The theory of the distribution of income stated in his later chapters is presented not with the thought that |