Thorstein Veblen
A Policy of Reconstruction.

"On the General Principles of a Policy of Reconstruction", Journal of the 
National Institute of Social Sciences, April 1918, pp. 37-46; republished in 
part as "A Policy of Reconstruction", New Republic, Vol. XIV, April 13, 1918, 
pp. 318-320.
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Considered as a going concern, collectively engaged in the traffic of human 
living, the American commonwealth is perhaps not ready to go into the hands of a 
receiver. There is, at the best, a wide-spread apprehension that the affairs of 
this going concern are in something of a precarious case. The case may not be so 
grave; but the derangement of conditions caused by the war, as well as the 
degree in which the public attention now centers on public questions, mark the 
present as the appointed time to take stock and adopt any necessary change in 
the domestic policy.
In assuming or accepting the assumption that there is need of some 
reconstruction, it is supposed that the system of use and wont under which the 
community now lives and does its work is not altogether suited to current 
circumstances, it is more or less out of date. This also carries the further 
assumption that the evil to be remedied is of a systematic character, and that 
merely palliative measures will no longer serve. This involves the proposition 
that some realignment of the working parts is necessary even at the cost of 
deranging any vested rights and interests that may stand in the way. That is 
what reconstruction means-it is a revision of vested rights, for the common 
good. What is to be avoided at all costs is the status quo ante.
An illustrative case may serve to show what is intended by the phrase "vested 
rights," in the more comprehensive sense. In modern industry as conducted by the 
methods of big business, it is one of the vested rights of the owner or employer 
freely to engage workmen on any terms on which they can be got, and to discharge 
them at discretion. It is another of his vested rights freely to employ as many 
or as few men as may suit his purpose, which is a quest of profits, and to work 
his own industrial plant more or less nearly up to its capacity, or not at all, 
as may suit his own purpose, in his quest of profits. On the other hand, among 
the vested rights of the workmen, or at least claimed as such, is their right to 
a job; so also an alleged right to discriminate as to what other men are to be 
associated with them on the job; also a right to quit work when they choose, 
i.e., to strike at discretion.
But taken in the large and seen from the point of view of the interest of the 
community, these vested rights of the two parties in controversy will figure up 
to something that may be called a right to exercise an unlimited sabotage, in 
order to gain a private end, regardless of the community's urgent need of having 
the work go on without interruption and at full capacity. The slowing down or 
stoppage of the industrial process at any point or on any plea by those who 
control the equipment or the personnel of industry works mischief to the 
community by that much, and falls short of that service which the community has 
a right to expect.
In such a case, it is evident, the vested interests so working at cross purposes 
are thereby cheating the community of the full benefit of the modern state of 
the industrial arts; and it is plain that such a case of interests working at 
cross purposes is a fit subject of revision. It should also be plain that the 
revision must be made primarily with a view to set up a condition of things that 
shall bring as much as may be of usefulness and content, and with only a 
secondary regard to the present vested interests of any one of the persons 
concerned.
This case of conflict between employer and employees, between the owner of plant 
and the owner of workmanlike skill and power, may serve to show what is here 
intended by incompatible or mismated vested interests. It is not here intended 
to find fault with either party to such a conflict. It is unreservedly assumed 
that they are all honorable men and all within their rights, as these rights 
have been allowed to stand hitherto. It is because the existing arrangement, 
quite legitimately and dispassionately, works out in a running campaign of 
sabotage, that the whole matter is to come up for a revision and realignment in 
which vested interests are to be set aside, under a higher necessity than the 
received specifications of use and wont and law. It is not that the conduct of 
the persons concerned is to be adjudged immoral, illegitimate, or improper; it 
is only that it, and the kind and degree of discretion which it involves, have 
in the course of time become L-insufferable, and are to be disallowed on the 
ground of urgent expediency.
The points and passages in the conduct of industrial affairs at which vested 
interests work at cross purposes among themselves or at cross purposes with the 
common good, are many and various, and it could serve no purpose to attempt an 
enumeration of them here. There are few lines of industry or trade where nothing 
of the sort occurs. The inefficiency of current railway enterprise, e.g., as 
seen from the point of view of material usefulness, has forced itself on the 
attention of the Administration under pressure of the war situation; so have the 
privately owned production and distribution of coal and the handling and 
distribution of food products. Shipping is coming under the same charge of 
costly incompetency, and the oil, steel, copper, and timber supply are only less 
obviously getting into the same general category of public utilities 
legitimately mishandled for private gain.
But to enumerate instances of such cross purposes between vested interests and 
the common good would scarcely be fruitful of anything but irritation. It may be 
more to the purpose to indicate what are the characteristics of the modern 
industries by virtue of which their businesslike management comes to work at 
cross purposes with the needs of the community or of a given class in the 
community; and then to look for something like a systematic remedial treatment, 
which might hopefully be turned to account - in case some person or persons 
endowed with insight and convictions were also charged with power to act.
It is believed that this working at cross purposes, commonly and in a way 
necessarily, though not always, rises to disquieting proportions when and in so 
far as the industrial process concerned has taken on such a character of 
routine, automatic articulation, or mechanical correlation, as to admit of its 
being controlled from a distance by such means of accountancy as are at the 
disposal of a modern business office. In many, perhaps in most, cases this will 
imply an industrial plant of some appreciable size, with a correspondingly large 
force of employees; but much the same outcome may also be had where that is not 
the case, as, e.g., an enterprise in automatic - vending machines, a "news 
company," so-called, or a baggage-transfer concern of the larger sort.
The mischief which such a situation gives rise to may be either or both of two 
distinguishable kinds: (1) disagreement and ill-will between employers and 
employees; and (2) mischievous waste, expense, and disservice imposed on the 
concern's customers. Not unusually the large and formidable concerns classed as 
big business will be found censurable on both counts. Again it is necessary to 
recall that this is not intended as implying that such management is 
blameworthy, but only that a businesslike management under such circumstances, 
and within its prescriptive rights, results in the untoward consequences here 
spoken of.
If this account of the state of things out of which mischief of this character 
is wont to rise is substantially correct, the description of the circumstances 
carries its own suggestion as to what should be a promising line of remedial 
measures. The mischief appears to arise out of, or in concomitance with, the 
disjunction of ownership and discretion from the personal direction of the work; 
and it appears to take on an added degree of mischance so soon as the 
discretionary control vested in ownership comes to be exercised by an employer 
who has no personal contact with the employees, processes employed, or with the 
persons whose needs these processes are presumed to serve - that is to say, so 
soon as the man or staff in control passes into the class of supernumeraries, in 
respect of the mechanical work to be done, and retains only a pecuniary 
interest, and exercises only a pecuniary control.
Under these circumstances, this central or superior control can evidently as 
well be exercised by some person who has no pecuniary interest in the 
enterprise; and who is therefore free to manage the industry with a view to its 
fullest usefulness and to the least practicable generation of ill-will on the 
side of the employees. Roughly speaking, any industrial process which can, and 
in so far as it can, be sufficiently well managed from a more or less remote 
office by methods of accountancy and for financial ends, can also, by the same 
token, be managed by a disinterested administrative officer without any other 
than formal recourse to accountancy and without other than a secondary view to 
pecuniary results.
All of which patently goes to sum up the needs of remedial measures, under two 
heads: (1) Disallowance of anything like free discretionary control or 
management on grounds of ownership alone, whether at first hand or delegated, 
whenever the responsible owner of the concern does not at the same time also 
personally oversee and physically direct the work in which his property is 
engaged, and in so far as he is not habitually engaged in the work in fellowship 
with his employees; (2) To take over and administer as a public utility any 
going concern that is in control of industrial or commercial work which has 
reached such a state of routine, mechanical systematisation, or automatic 
articulation that it is possible for it to be habitually managed from an office 
by methods of accountancy.
Needless to say that, when set out in this bald fashion, such a proposed line of 
remedial measures will appear to be shockingly subversive of law and order - 
iniquitous, impracticable, perhaps socialistic. And it is needless to argue its 
merits as it stands; particularly not to argue its merits within the equities of 
the existing law and order. Yet it may be as well to recall that any plan of 
reconstruction which shall hope to be of any slightest use for its main purpose, 
must begin by violating one or another of the equities of the existing law and 
order. A reconstruction means a revision of the present working system, the 
present system of vested interests, and of the scheme of equities within which 
that system is now working at cross purposes with the common good. It is a 
question of how and how far a disallowance of these existing vested interests is 
to be carried out. And the two propositions set out above are, therefore, 
intended to mark the direction which such a remedial disallowance of 
prescriptive rights will obviously take; not the limit to which such a move will 
necessarily go.
There is no socialistic iconoclasm in it all, either covert or overt; nor need 
any slightest animus of moral esteem or disesteem be injected into the argument 
at any point. It is a simple matter of material expediency, in which one of the 
prime factors to be considered is the growing prospect of an inordinary popular 
distrust. And the point of it all is that the present system of managing the 
country's larger industrial concerns by business methods in behalf of vested 
interests is proving itself bankrupt under the strain of the war situation; so 
much so that it is already more than doubtful if the community at large will 
hereafter be content to leave its larger material interests at the mercy of 
those business motives, business methods, and business men whose management is 
now shown to work such waste and confusion as cannot be tolerated at a critical 
time, The system of vested rights and interests is up for revision, 
reconstruction, realignment, with a view to the material good and the continued 
tranquillity of the community at large; and there is therefore a call for a 
workable scope and method of reconstructing the existing scheme of law and order 
on such lines as will insure popular content. In this bearing, the meaning of 
"Reconstruction" is that America is to be made safe for the common man - in his 
own apprehension as well as in substantial fact. Current events in Russia, for 
instance, attest that it is a grave mistake to let a growing disparity between 
vested rights and the current conditions of life over-pass the limit of 
tolerance.
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