510 
NATURE 
[SEPTEMBER 18, 1902 
every house built by the local authority one less is built by private 
enterprise, and that this is very likely to happen. Houses have 
been built by private enterprise in the past, and in these houses 
nearly the whole population is at present housed. I have seen 
an enthusiast for municipal housing stand in the empty streets 
of a town late at night, when every soul in the town was 
evidently housed, and say, in a tone of conviction, ‘‘ Private 
enterprise has failed. » Tn that town four small houses had been 
built by municipal enterprise and more than ten thousand by 
private enterprise, and private enterprise was adding hundreds 
every year, while the housing committee of the corporation was 
meeting once a year to re-elect its chairman. Is it likely that 
private enterprise will build as much when it is competed with 
or supplemented by—the term does not matter—municipal 
enterprise? Why should it? If the municipality turned baker, 
would the private bakers continue to bake as much bread? Is 
not the attempt to stop overcrowding by inducing local authori- 
ties to build houses exactly the same thing and just as absurd 
as it would be to attempt to cure under-feeding by opening 
municipal butchers’ and bakers’ shops ? 
In the long run, [ admit, experience teaches. Protection has 
fallen once in this country, and I have little doubt that it will 
fall again if it becomes considerable. The policy of obstructing 
the removal of dwellings from the centre of a great city already 
excites opposition in the London County Council, though 
unanimity still reigns in those last homes of extinct superstitions, 
the Houses of Parliament. Chancellors of the Exchequer and 
finance committees may be trusted to offer a stout resistance, on 
what they call financial grounds, to any really great develop- 
ment of the system of subsidies. There is hope even that the 
municipal building policy may be checked by the laborious 
inquiries which show by statistics what everyone knows, that 
the poor are ill-fed and ill-clothed as well as ill-housed, and 
therefore lead people to consider how the poor may be made 
more able to pay for houses, among other things, instead of 
simply how houses may be built in the absence of an effective 
demand for them. But I claim that, in matters such as these, 
a more widespread appreciation of economic theory, and the 
quickened intelligence which that would produce, would save 
us much painful experience, many expensive experiments, and 
an enormous mass of tedious investigation. 
Thirdly and, at any rate on the present occasion, lastly, I 
claim that the teaching and study of economic theory has great 
practical utility in promoting peace and good will between 
classes and nations. 
Between classes within the same nation the peacemaking 
influence of economic theory lies chiefly in the fact that it tends 
to get rid of that stupid cry for “rights” and ‘‘ justice” which 
causes and exacerbates industrial and commercial quarrels. 
When demand for some commodity falls, or supply from some 
new quarter arises, and profits and wages fall, the workers cry 
out that they are being unjustly treated, because they have the 
unfounded belief that reward is or ought to be proportional to 
moral merit, and they are not conscious of any diminution of 
their moral merit. They demand a living wage or a minimum 
wage and employment for all who happen to have been hitherto 
employed in the trade, rend the air with complaints, and get 
subscriptions from a compassionate but ill-informed public. We 
cannot, of course, expect people who suffer by them to regard 
even the most beneficial operations of the economic organisation 
with enthusiasm or even satisfaction. It would be absurd to do 
so. Butall the same, it is true that a wider apprehension of the 
fact that it is only by raising and lowering the advantages offered 
by different employments that production is at present regulated 
so as to meet demand would not only diminish the dissatisfac- 
tion, but also, which is more important, diminish the actual 
suffering by causing transitions to be less obstinately resisted. 
The present fashion of deploring rapid changes of trade and 
dwelling-place is a most unfortunate one; the ordinary forms 
of labour do not, as a matter of fact, require such specialised 
ability that there should be much difficulty in changing from 
one to another ; and surely it is much better for a man to work 
at several different things at different places in the course of his 
life than to stick for ever in the same place, surrounded by the 
same objects, going through the same monotonous round of 
duties. Anything which will weaken the present obstructive 
sentiment and lead people to regard the necessity of a change 
of employment or residence as a temporary inconvenience 
rather than a cruel injustice is to be warmly welcomed. 
No. 1716, VOL. 66] 
It is not, however, only the poor and the industrious who 
would be taught by a greater knowledge of economic theory not 
to kick against very necessary pricks. The rich, both indus- 
trious and idle, would be taught to be far more tolerant than 
they are of attempts to diminish inequality of wealth by reducing 
the wealth of the rich as well as increasing that of the poor. 
The economist may be a little annoyed with the workman who 
insists that he ought to have thirty shillings a week for pro- 
ducing something worth fifteen shillings, or five shillings, or 
nothing at all, but he can only have hearty contempt for the 
millionaire who holds up his hands in holy horror and murmurs 
‘“confiscation,” ‘ robbery,” ‘‘ eighth commandment,” when it 
is proposed to relieve him of a fraction of a farthing in the 
pound in order to bring up destitute orphans to an occupation 
in which they may earn twenty-five shillings a week. The 
sanguine teacher of economic theory has hopes of making even 
such a man see that he has his wealth, not because Moses 
brought it down from Sinai, or because of his own super- 
eminent virtue, but simply because it happens to be convenient, 
at any rate for the present, for society to allow him to hold it, 
whether he obtained it by inheritance or otherwise. In other 
words, that private property exists for the sake of production, 
not for the sake of the particular kind of distribution which it 
causes. Some, I know, say that the rich are so few that it 
does not much matter whether they acquiesce in the measure 
meted to them or not; but that is not the teaching of history, 
and I think you will agree with me that for the progress of the 
whole community it is, in practice, quite as important to secure 
the acquiescence of the rich as of the poor. 
In regard to international relations, the first business of the 
teacher of economic theory is to tear to pieces and trample upon 
the misleading military metaphors which have been applied by 
sciolists to the peaceful exchange of commodities. We hear 
much, for example, in these days of ‘‘ England’s commercial 
supremacy,” and of other nations ‘‘ challenging” it, and how it 
is our duty to ‘repel the attack,” and so on. The economist 
asks what is ‘‘ commercial supremacy ” ? and there is no answer. 
No one knows what it means, least of all those who talk most 
about it. Is it selling goods dear? Is it selling them cheap? 
Is it selling a large quantity of goods in proportion to the area 
or of the country ? or in proportion to its population? or abso- 
lutely, without any reference to its area or population? It 
seems to be a wonderful muddle of all these various and often 
contradictory ideas rolled into one, Yet what a pile of inter- 
national jealousy and ill-feeling rests on that and equally 
meaningless phrases! The teacher of economic theory analyses 
or attempts to analyse these phrases, and they disappear, and 
with them go the jealousies suggested by them. 
When misleading metaphors and fallacies are dismissed, we 
are left with the facts that foreign trade—the trade of an area 
under one Government with areas under other Governments—is 
merely an incident of the division of labour, and that its magni- 
tude and increase are no measures of the wealth and prosperity 
of the country, but merely of the extent to which the country 
finds it convenient to exchange commodities of its own growth 
or manufacture for commodities produced elsewhere. If the 
city of York were made independent, and registered its imports 
and exports, they would come out far larger per head of popu- 
lation than those of the United Kingdom or any other great 
country. Should we be justified in concluding York to be far 
richer than any great country? If means were discovered of 
doubling the present produce of arable land with no increase of 
labour, much less corn would be imported into Great Britain 
and less of other goods would be exported to pay for it; the 
foreign trade of the country would consequently be diminished, 
but would the people be any less prosperous? What jealousies, 
heart-burnings, and unfounded terrors leading to hatred would 
be extinguished if only these elementary facts were generally 
understood ! 
To anyone who has once grasped the main drift of economic 
theory, it will be plain that the economic ideal is not for the 
nation any more than for the family that it should buy and sell 
the largest possible quantity of goods. The true statesman 
desires for his countrymen, just as the sensible parent desires 
for his children, that they should do the best paid work of the 
world. This ideal is not to be obtained by wars of tariffs, still 
less by that much greater abomination, real war, with all its 
degrading accompaniments, but by health, strength and skill, 
honesty, energy and intelligence. 
“ 
