INTRODUCTION

I. The Study of Current Economic Problems

In this day of rapidly changing values, particularly in economic life and thought, one cannot publish even so unpretentious a work as a book of readings without offering an explanation. The reader desires to know the scope of the volume, the principles governing the selection and arrangement of the materials which compose it, how it is to be used, and the objects which it is supposed to accomplish. In short, he asks for the theory of the book; and this is the purpose of these introductory pages to furnish.

The title commits the volume to the domain of current economic problems; but currency is not a mere matter of the transitory and ephemeral aspects of economic life, such as are noted in the morning paper. The most recent industrial merger, the latest bit of legislation, the court decision just announced do not mark out its province. The economic questions currently discussed and subject to immediate political action do not fix its bounds. Such things as these, distinct as they seem to be, are mere passing phases of larger and more complex problems. For their beginnings we must look into the far-distant past; their ends it is not yet vouchsafed to us to see. They are in process of gradual solution. The issues which they involve are much more intricate and subtle and much less comprehensible than their immediate aspects would seem to indicate. In form and content each is closely identified with the stage of industrial development which we have reached. Each involves something of almost every phase of our complicated social life. As separate problems they are merely aspects of a larger reality. If, then, we would understand them aright, we must study them in their historical setting as incidents in the development of society.

Their essential unity makes the word problems in the title unfortunate. The term seems to imply the separate treatment of a number of loosely connected questions. The editor disclaims such pretentiousness in his use of it. He has no intention of presenting an aggregation of summaries from many particular fields of economic knowledge. He purports to give no epitome of a dozen different volumes discussing as many different problems. In this book he can neither make use of the methods, nor accomplish the results, of advanced study. A proper understanding of each of these problems

is contingent upon a mastery of the workings of some very intricate economic machinery, a careful examination of a large amount of factual material, a painstaking analysis and interpretation of the phenomena of the field of study, and an elaboration of the conclusions drawn from it. To attempt such a task for each of the problems presented here in the space available is impossible; it would result in a mere formal presentation of half-truths. The object of this volume is of another kind; it is introductory. It attempts to present a general view of the whole as a necessary preliminary to a study of particular problems. So far as the latter are separately treated, they are presented as aspects of the larger whole.

A study of problems implies a search for answers. But, if this volume is to be judged by its ability to supply the earnest student with the right answer to each of the questions it discusses, it must indeed be found a dismal failure. The number of problems with which it deals precludes the detailed study which should precede the formation of "final" opinions. Besides, it is extremely doubtful whether the problems of industrial society can be settled dogmatically. As economists we can, and should perhaps, dogmatize about such principles as "the law of diminishing returns." But no economic problem can be resolved by the application of a single simple law; it is part of a situation much too complex and subtle and peculiar for that. Nor can it be made to yield to the magic that lies in a separation of all proposals into the two simple classes of the "good" and the "bad." Nor yet can its solution emerge as the result of a process of calculating resulting utilities and disutilities. Every proposal involves a distribution of costs and utilities between the present and the future, and between different classes in society. It has not one, but many, economic consequences, good and bad. It is sure to affect in countless ways, for better or for worse, the legal, political, ethical, religious, and social aspects of life. There is no magical instrument of measurement which can unlock such a riddle by promising that a certain definite surplus of good or ill will follow the application of a given proposal. Such values are incommensurable by any known instrument of calculation.

Yet, to make judgments in the face of these complex schemes of incommensurable values is the essence of the problems which we are to discuss. If their solutions are to be advanced, if industrial society is to develop, such judgments must be made. We cannot blink the fact that every proposal advanced involves both the good and the bad, the desirable and the undesirable. We cannot forget that to get some of the good things we want, we must give up other good things; that to escape some of the costs we are unwilling to

incur, we must endure others. In short, the "solution" of an economic problem involves a choice between conflicting and incommensurable values. The decision which it requires transcends the utmost that can be pent up in any strictly economic terms; it is contingent upon nothing less than our ideal of the socially desirable. But, if our efforts are to be effective, we must aim at the attainable. We must take full account of the limitations imposed upon the "solution" of problems by contemporary activities, prevailing institutions, and the attitudes of the various classes which make up society. In view of the large economic and intellectual environment surrounding them, economic problems are not suddenly to be disposed of; definite and final answers are not to be found for them. Rather they are gradually to be solved; they must have everdeveloping answers.

Upon this theory of a choice between conflicting and incommensurable values the readings which follow have been selected. They come from the most miscellaneous sources. They represent all the prominent attitudes, from the most conservative to the most radical, which condition the direction of our development. They are written by men possessed of the widest variety of opinion— economic, political, and sociological. They represent emotionally as well as intellectually (for feelings count as strongly as logic in the practical affairs of our everyday world) the conflicting views and arguments which contemporary society is bringing to bear upon its problems. They contain sound argument, good judgment, truth. They contain, too, much of overstatement, fallacious reasoning, and falsehood. But all are important for, sound or unsound, true or false, they are active elements of the problems we would solve. The reader should not too definitely attempt to separate them into the "true" and the "false." All thought is conditioned by its fundamental assumptions. Matters of personality, of class, of time, and of place manage to make their way into all intellectual work. Those who regard themselves as most immune are frequently most subject to these disturbing influences. Undoubtedly fundamental differences about economic programs frequently grow out of the possession or non-possession of the "facts." But far oftener they are due to conflicting attitudes which represent endeavors to find social good by generalizing individual interests. Some such study is necessary to a clear appreciation of the many conflicting values involved in the conscious judgments upon which the solution of our problems depend.

In quite another way, the miscellaneous character of these readings should prove valuable. They should help the reader to approach

economic questions without personal or class bias; they should lead him to see that his own opinions, despite the authority of their source and their venerable age, are not necessarily the expression of economic verity; and they should induce in him some willingness to hold in abeyance his judgment on economic questions. Vital and valid arguments in support of a proposition in which one thoroughly disbelieves should do much to prevent haste in the formation of his final judgments. Even erroneous arguments have their pedagogical value. Stimulation is by provocation as well as by suggestion; and it is hoped that more than one of the readings which follow will provoke the reader into a more careful formulation of his opinions and a clearer statement of his reasons for possessing them. Above all, it is hoped that in a constructive way they may give the beginnings of a flexible and developing economic program. Its fulness can, and should, come with time, study, and reflection.

It cannot be denied that many of the readings touch upon questions which many think cannot be discussed without "danger to society"; and that others present views which "threaten to subvert our institutions." Fortunately the disposition to exclude "dangerous subjects" and "dangerous views" from academic discussion is much. less pronounced than it used to be. There seems to the editor little doubt that the danger is, if not altogether absent, at least unduly magnified. To the extent that it is real, however, an injunction against discussion is not the proper method of minimizing it. The safe course lies rather in getting students to think clearly in terms. of economic situations and to recognize in this thinking the many fundamental economic values which usually fail of popular consideration. The erection of signs prohibiting trespass is the best method of enticing college students into forbidden fields of discussion. Much better is it to invite to this forbidden territory under proper guidance. It is hoped that the selections which follow will reveal some of these values and will do something to induce intelligent thought.

To the end of showing the setting of our current problems and the many conflicting values which they involve, the book has been made to consist of a large number of short readings rather than a small number of long ones. Whatever may be the value of the latter type of manual for advanced work, its usefulness in elementary instruction is largely its power of compelling labor. A small number of readings cannot at all cover the field adequately; they cannot furnish a clear perspective of the subject as a whole; they cannot introduce economic problems in their larger setting. They contain much extraneous matter; they include discussions of subtle points

lost on all except advanced students; and they are prone to cause the student to lose the main issues in a world of detail. They commit the fundamental error of attempting to exhibit the particulars before the student has seen the whole. They make it difficult for the average student to discriminate between the accidental and the essential; and too frequently their use leads to a substitution of heroic clerical work for intellectual exertion. In the readings here presented an attempt has been made to eliminate the non-essential and the confusing.

This induced simplicity is not intended to convey the idea that the problems involved are simple, and that social economics is a subject which can easily be "mastered." On the contrary, few teachers will be tempted to charge this volume with an elucidation of the merely obvious. On the contrary, the very difficulty of the subjects treated makes it necessary that the many and conflicting arguments be presented as simply and definitely as possible. One of the functions of the book is to show the difficulty and complexity of the problems. Perhaps nothing is doing more to complicate the solution of our problems at the present time and to prevent the elaboration of a definite program than the belief of so many people that these same problems are simple and easily understood, and that "evils" are responsive, to simple prescriptions. To convey the idea of simplicity and intelligibility, when these are not of the subject discussed, is to fail on the very threshold of economic study.

In an introductory course, the primary desideratum is not the acquisition by the student of facts and formulas, which he can hand back at examination, having no further use for them. It is rather to induce on his part a developing appreciation of the situation as a whole and of the relation of institutions and problems to each other and to it. It is more desirable that he come to understand the subject than that he amass formal knowledge about it. It is preferable that he learn to think intelligently in terms of a complex industrial situation than that he acquire a vast collection of "principles" that formally explain its working. The readings are intended to supply not factual material upon which the student can be quizzed, but rather matter that will raise questions and provoke thought. They are intended to prepare for recitation by giving the instructor and the students something to discuss together. The function of the instructor is to direct and guide the discussion, and to see that the thought of the students is intelligent and intelligible.

It is no part of the function of this volume, therefore, to lighten the instructor's labors. Ease and a shifting of responsibility can better be found in the formal lecture or in quizzing from a text. The