Review of Veblen’s 'The Theory of Business Enterprise.' Article: An American Socialism, By William English Walling The International Socialist Review. A Monthly Journal of International Socialist Thought Vol. V (July, 1904-June, 1905), Chicago, 1905 Vol. V, April, 1905, No. 10, pp. 577-584 ------------------------------------------------------------------------- [577] An American Socialism. SOCIALISM is either an evolutionary science or it is no science at all. If it is an evolutionary science it should develop in its most advanced form in the United States where the development of industry is the most advanced. Karl Marx who has been outgrown in Europe must become an historical reminiscence in the United States. So far America has had no Karl Marx nor is it certain that we shall ever have one. But the Socialist movement in America will certainly develop a philosophical backbone which will mean to America what Marxism has meant to Germany. More than any other American writer, Prof. Thorstein Veblen has foreshadowed what this backbone will be. A professor in the most American of all cities, Chicago, on the pay roll of the University founded by John D. Rockefeller, a deep student of international Socialism as well as of the classical and historical schools of political economy and one of the keenest observers of contemporary society in this country. Prof. Veblen is well equipped for the task. He is not a propagandist, but a scientific observer. In this capacity, it is manifestly incorrect to call him a Socialist. But if he is not a defender of any proposed industrial or political changes, it is equally certain that he defends no existing institution, however great its sanctity. In Prof. Veblen's view the business man, and not the great capitalist, figures as the enemy of society. But Prof. Veblen's business man differs from Marx's capitalist in the most fundamental manner. Though the Professor mercilessly flays the business men, he yet concedes that they are "honorable men, all, most honorable men," — in other words, that they doubtless believe in themselves. This harmless and, in America at least, just [578] con- --- following page corrupt --- cession to the business man, Marx was n He always impugned their motives. Why say. Perhaps the German capitalist is a implied. Certainly the American business but rather an unsympathetic, unintellectual own environment and interests. Marx s capitalist. Apparently either he wished or he hc^d to convert him. The former latter that very Utopianism that Marx pret does not expect that American Socialists wi selves to the ruling class or condemn the all others, are the product of their envir be converted. 'When they have lost thei classes in the course of economic evolution Veblen agrees with Marx that his " useless to society as Marx's capitalists. to the men that govern industry a dominan different character, not mere exploitation, tion for its own sake and the sincere beli for the benefit of the human race. The A not only exploits, he thinks, lives, eats and Above all he believes in exploitation and he Now, what fundamental differences thi only in social philosophy, but in every s practical politics as well. If business me sake of power, it is impossible to expect th tive in the remodelling of society, whateve erned rather as Marx claimed, by their lp might be touched on that tender spot. not only more evolutionary, but also mo that of Marx's. Veblen's economic standpoint is in the that of Marx. Both agree that Socialism a step at a time. But Marx, and still m looked forward to the ripening of one indi democratic control. Veblen, ^ided by the advance of the United States, has seen th industry from another breaking down, al monopolies becoming inter-related and or ing into one complete whole. In other wo trol the great railroads, banks and industri Under these conditions, then, the step at to lie in the decrease of the power of the over the government, in the corresponding importance of the industrial class and th within that class. The trusts wilF not I by ripening industries for it one at a time [579] by increasing a hundred-fold the difficulty of taking the first step against their consolidated power. The capitalist system will not fall of its own weight. There is no possibility of a cataclysm. The problem of disposing of the growing surplus for which foreign markets are so urgently demanded, can be easily disposed of by the ruling class. The methods of doing; this are two-fold. Either the country can be hurled into international war and all the wasteful preparations that precede and degradations that follow international war, or a benevolent feudalism can be developed. If the trusts continue their present rapid rate of growth, the latter seems the more likely outcome. How the surplus will be disposed of in that case, Prof. Veblen showed in his recent book on the leisure class in America. Here Veblen conceded that the business man himself does not waste any vast sums in consumption, however wasteful and anti-social may be his operations in production. In consumption it is his wife and children who spend the money. To the possibilities of consumption in this line, there is no limit. If the money-making sport comes to an end on account of the complete organization of industry by the great financiers, then the vast sums formerly manipulated by the business men for various speculative purposes will be entirely turned over to his wife and children who have already made such splendid records in extravagant living and "conspicuous waste." In the book just mentioned. Prof. Veblen not only shows this waste, but he analyzes its causes. These are an effort to spend money in an emulative manner in order to make obvious to all observers either the amount of wealth owned or the length of time it has been in the possession of the family. Expenditure, in other words, is not for material brute comforts as Marx and all his followers have supposed. To such expenditures there is a physical limit. To the very "spiritual purpose" on the other hand of showing off a supposed social superiority which may take the form of innumerable houses, servants, diamonds, laces, etc., there is no limit whatever. There need be no more crises or underconsumption if capitalists work this outlet for its full value. Between international war and "conspicuous waste" there is no danger of the capitalist ever becoming seriously embarrassed by the surplus. In Marx's time the petty bourgeois ideal of personal economy and rational living prevailed widely. In our times the ruling element in the ruling classes everywhere are troubled with no such scruples. Even the "simple life" requires enormous expenditures in charity and display of a "quiet" kind. Veblen has revolutionized the materialistic conception of [580] --- following page corrupt --- history. In a far deeper sense than Marx of environment on human progress. With not only shapes the interests and opinions holds the very feelings, tastes and habits individual. With Marx possessions and t individual fixed his class. 'With Veblen environment determines his attitude to life is more deeply perverted according to Veblen according to Marx. The thinking working people are Socia cause their interests are opposed to those because their minds are constituted diffe have different standards and different ideal these were themselves shaped by the mater the immediate and determining force that is not their legal status or lack of prosper nor even the compelling power of new ind is rather llieir disregard for the institution all the "foundatiwis of society" on which rely to kepp them in subjection. With Veblen vironment has its principal influence thro The class struggle of Veblen is not Marx. Marx's class struggle was a confli len's is a conflict of minds (not of ideas b and habit of thought.) There is a crucial views. If, according to Marx's view, an any accident or exceptional qualities, be s one class and put into another, he should, a of time, become imbued with the principle which he was transferred. No such sudd ble if Prof. Veblen is right. The individua become silent. He might be bribed in might repeat in a parrot-like manner the class in which he had arrived, but he cou been sufficiently moulded in the other clas active factor in the defense of the new one tween the classes is not a difference of int mental and moral contrast in the very nat that compose them. It is far deeper than principal followers have supposed. Moreover, Prof. Veblen's working cla defined from that of Marx. The only are certain to be influenced by the extre mind are the skilled mechanical trades. the lawyers, the bankers, the business men ticians. With these are also the rural pop population of the country towns and in a [581] smaller farmers of the remoter country districts; so also the delinquent classes of the cities and the populace of the half-civilized and barbarous countries. The body of unskilled workers, especially those not associated with the men in the skilled mechanical trades, are not seriously affected." It is not the propertyless classes, the proletarians, the wage- earners, that are affected by Socialist sentiments as Marx claimed, but rather those engaged in industrial or scientific as distinct from pecuniary or business employments. If Marx is right and Veblen is wrong, the majority of the community being without any considerable accumulation of capital, ought to be Socialists at the present moment. But the majority of the community is not only not converted to Socialism, but is radically and fundamentally opposed to it. This is perfectly natural according to Veblen's view since the business men plus the farmers plus the hand trades, and not the machine workers, constitute a majority of the community and will continue to do so for several decades or perhaps a generation to come. Still Veblen concludes that economic evolution will bring about Socialism. At present only the minority of the community is organized under the new industrial regime as machine workmen, superintendents or scientists. Only these are capable even of grasping the Socialist view. Ultimately, they will certainly constitute the majority. In the meanwhile the business men, from the large capitalists to small farmers or some element between, will continue to control the community. Socialism, according to Veblen, must base its hopes on the future development of the advanced industries, on economic evolution, rather than on Socialist propaganda. The most that propaganda can do is to educate the industrial classes to the new standpoint. This he believes is being very rapidly accomplished. "When distrust of principles rises to such a pitch," says Prof. Veblen, "as to become intolerant of all pecuniary institutions and leads to a demand for the abrogation of property rights rather than a limitation for them, it is spoken of as 'Socialism' or 'anarchism.'" Prof. Veblen does not attempt a closer definition of the Socialist position. He does not even mention the public ownership of the instruments of production, distribution and exchange. No radical Socialist is so suspicious of this public ownership idea as Prof. Veblen, since he ignores it altogether. "The constructive proposals of the Socialists," he says, "are ill-defined and inconsistent and almost entirely negative." In Prof. Veblen's view this is the essence of the scientific attitude of mind and the acme of all praise. The vagueness and inconsistency of their constructive proposals, he says, is only to be taken as evidence that [582] the attitude of the Socialists cannot be expressed in terms of the institutions as at present in force. In other words, new words and new phrases not yet in use, will have to be found for each one of the elements in the Socialistic position. It is less and less capable of being formulated as a business proposition. But Prof. Veblen has shown that practically all business is parasitic in its nature. To say that Socialism is not business-like is to say that it is not based on exploitation. Prof, Veblen explains himself by paying that the vagueness of this Socialist position should not allow it to be confused with mere class hatred or general discontent. Many other revolutionary movements have had these features, but Socialism, though it is a revolt against all existing institutions, always founds its protest on the fact that existing economic organization is outgrown. Prof. Veblen then develops a view of a revolutionary character of the Socialist movement that is as broad, if not broader, than any other that has ever been suggested even by the most revolutionary Socialists. "The Socialist sentiment," he explains, "is threatening, unprecedented, and perplexing for practical men of affairs to deal with." It not only attacks the "natural rights and institutions of property" as the unions do in a very similar manner, but it is distinguished from the union movement by a similar failure of regard for all "other articles of institutional furniture handed down from the past." It may be observed, however, that the average workman, and therefore the average union, is also pretty well permeated with a lack of reverence for most existing institutions. The Socialists alone have formulated their irreverence into a philosophy. As to politics, Prof. Veblen says "it seems to be their belief that the community can get along without political institutions. On this head again, the Socialists have nothing consistent to offer." (Remember, Prof. Veblen does not over-value mere consistency). But "their political bias is radically democratic," and they are "completely opposed to the state as the conception is at present understood." That the Professor does not consider their disregard for existing political institutions a sign of unintelligence may be seen in his own treatment of politics which he places among the archaic vocations along with "war, fashion and religion." Socialism not only attacks the economic and political structure, but also accepted moral truths. It "brings about a weakening of convictions as to the full truth and beauty of the received institutions without much consensus as to what is to be done about it, if anything." It is to be hoped that the humor of this paragraph has not escaped any of Prof. Veblen's readers. Religious conceptions are equally undermined in the [583] workingmen's minds. "The cultural era (beginning in the 18th century) of Natural Rights, Natural Liberty and Natural Religion reduced God to the rank of a 'Great Artificer'." (Because this was the age of the artificer and handicraftsman)". "The machine technology is in turn relegating him to that fringe of minor employments and those outlying industrial regions to which the handicraftsmen have been retired." Finally, and at the bottom of all, the industrial revolution has completely revolutionized the workingman's way of thinking. Before, the machine age the causes of a given effect were not thought of as themselves effects; that is, causes were thought as final. This, according to the present mode of thought, they never are. Similarly, if the cause was the beginning, the effect was treated as the end of a chain and not as itself a cause of succeeding effects. The machine technology has done away with all this. Being a mechanical or material process, it requires the attention to be centered on the process itself and not on the original causes or the final effects of the process. To the machine worker the process comes to count and is the substantial fact that engages his attention. The modern workmen learn to think in terms of the process. They have come to think and to feel as people never thought or felt before. This American Socialism is not based on any outworn Hegelian logic nor on any absolute and therefore unscientific social philosophy. It is entirely twentieth century science, viewing society as all the rest of the universe as in a perpetual condition of evolution, and forsaking all accepted terms and formulas as unfit for scientific use. The American people also take a relative view of life. In the limited sphere in which American life has moved, the prevailing views are almost scientific in their character. The American manufacturer has no absolute views with regard to machinery, labor or industry. He is governed scientifically by the working hypothesis. To a lesser degree the same holds true of the whole community. Absolute views do hot and cannot prevail in the practical life that dominates America as it never dominated any other nation in the world before. As Hegel observed fifty years ago, there is no political life in America because no social classes have yet been forced to a lower level of life than they have been accustomed to. The Americans have so far no constructive political idea, no practical aims in politics. But when the nation does turn its attention to politics with the same spirit, the, same vigor and the same absolute determination to achieve results with which it has devoted itself to industry and business, who can doubt that the ruling ideas will be practical or relative in their character? But there must be ruling ideas and working hypotheses, and [584] ---- following, last page corrupt ---- none have yet taken hold on the commun has done his part to indicate very broadly will be. It remains for those who are going leadership of the industrial classes to build u tical American philosophy and program. T international basis, there can be no doubt, advance of all civilized countries follows there can be no question. Neither will any dustry is gradually being established on th market. But especially under the capitalist em every nation with scarcely any check to-d will have to be national, the whole world k must lead. The crisis may be more acut economically trained, the educated, the indepe people of this country will not require a c see the light. William English Walling ------------------------------------------------------------------------