956 REPORT — 1898. 



exaggerations which could add a rhetorical force to their claim for a radical 

 change. But it has been left for very recent writers not almost but altogether to 

 ignore the influence of the spiritual environment, and to declare the material sur- 

 roundings to be not merely a great part but the whole, wherever the institutions 

 of society are concerned. This waa iirst done by Marx and Engels. It has been 

 done lately by Pro lessor Loria, and Professor Patten betrays an inclination to 

 follow the same course, though with more caution. 



If our friends by their new ' economic interpretation of history ' had meant no 

 more than the late Thorold Rogers by his, we should have little ground of quarrel. 

 The past generation has seen the historical and the theoretical economists reconciled. 

 AVe all acknowledge now that too little weight was attached to changing 

 historical conditions by the older economists ; and, on the other hand, a new light 

 has been thrown on history by a closer attention to economic conditions. It was 

 shed by Adam Smith in his account, for example, of the decay of feudalism. 

 Buckle, too, cast a glimmer of it. It must of course be remembered that what we 

 read between the lines of history is not itself necessarily history. But we must 

 leave it to historians to punish the shortcomings of historians ; and we must for 

 oiir part confess the failings of the economists. The older economists sometimes 

 mistook the peculiarities of their own epoch and country for invariable attributes 

 of humanity. The task of their successors has very largely been to decide which 

 of their ' categories ' are really historical aud which"'permanent. This is in great 

 part the meaning, for example, of the restatement of their doctrines by Professor 

 Marshall and Professor Nicholson. It involves a historical interpretation of 

 economics, to be set side by side with the economic interpretation of history by 

 Professor Cunningham and Professor Ashley. 



But the newest economic interpretation of history goes far beyond such modest 

 rendering to Caesar of the things that are Caesar's. It is a substitution of 

 economics for history, as history has been hitherto understood. Formerly we used 

 to be told that all economics was relative to history ; now we are to believe that 

 all history is relative to economics, men having been made what they are by 

 economical causes. Both dogmas seem not so much obviously untrue as obviously 

 beyond testing, for if all is tainted with relativity these dogmas themselves will 

 be so tainted, and we could not have formulated either of them without unclothing 

 ourselves of our epoch and rising above time and circumstance. It may be the 

 case that we do so rise and so unclothe ourselves; but there is no provision for the 

 privilege in the premises of our theorists, and it must therefore be denied to their 

 conclusions. 



We need not have introduced this philosophical argument if there had not 

 been a_ claiai of universality advanced by the economists in question. Most 

 econornists are content with less than universality ; they are working out a limited 

 field with full consciousness of its limitations. The new thinkers are less humble. 

 Their method may almost be likened to the abstract method of the older econo- 

 mists with a denial that there is any need for the abstraction, a denial at least 

 that the field of economics has any boundaries. 



What impressed the German socialists— Marx, Lassalle, Engels, Kautsky— was 

 the demonstrably economic character of many political changes of the last 300 

 years. In the course of industrial changes the mediteval landowners gave up 

 their power to the capitalists, and the capitalists to the employers of labour. 

 Therefore, said the German socialists, all is due to a change in the prevailing 

 form of production. "WTiere agriculture prevails, we have a territorial aristocracy, 

 !i certain political system, and certain social institutions and laws ; where commerce 

 prevails we have another system ; where manufacture, a third. This explains the 

 ]ise of the middle classes into political power, but also the advance of the 

 working classes as a power that will displace them and be (as we are told it ought 

 to be) all in all. As in the economic theory of Marx and Engels all value is from 

 labour, so on the great scale of politics all power is to be with the labouring class. 

 Economic progress is thus the only real progress ; the essence of all history is 

 economics ; the essence of all economics is labour. The steps of the progress (we 

 hear with mingled feelings) will be for the whole world what they have been for 



