divided into the positive-social and the negative-social, or "acquisative." 1 (3) The necessity of society and the true nature of social relations make predatory activities and agencies unproductive in a true and scientific sense. (4) The "entrepreneur viewpoint when in conflict with the social-individual point of view is unsound; for: (a) the entrepreneur also depends upon society, (b) and his " lonely " estimates are mere seemings of no causal significance. (5) The significance of costs in economics is that they (a) function in production and (b) limit supply; but " entrepreneur costs,' so-called, have no such significance. (6) The technological concept of production and capital cannot be abandoned, because utility depends upon adjustments in materials; but values in society direct the technological process.2 V. THE SCIENTIFIC CHARACTER OF THE SOCIAL-INDIVIDUAL POINT OF VIEW Finally, we must consider the question, Is the social point of view so full of ethics and optimism and unreality that it cannot be used for scientific purposes? It may be granted at once, that, if the individual is to be thought of as an unsocial or lonely individual, he will necessarily regard the interests of society as separate from and often clashing with his own, with the consequence that, for him, to take the social point of view would involve an ethical choice. But a true social point of view, being based upon a true concept of society, is not that of such an individual, and consequently loses its ethical character. It merely begs the question 1 Anti-social activities may be divided into the merely " parasitic " and the destructive. 2 This conclusion does not lead us to materialism, for utility is the decisive thing, and not all adjustments have utility. Utility sanctions costs. The old ideas on this subject need correction, but not the extreme reaction to the subjective or the unsubstantial. แ to link "social" with "wholesome," deserving," "welfare," "duty." The social point of view, as I have taken it, does not concern what ought to be. It merely stands for a fact, the fact that individuals lose significance apart from society. It is based on what individuals do, not on what they should do. So it is with optimism. To be sure, the social individual need not, like the lonely individual, be a pessimist; but that fact no more makes him an optimist than it makes one jubilant not to be miserable. It is the individual who is lost in the social organism who is optimistic! But the question is asked, do economists who profess the social point of view not consider that all gainful occupations are socially productive, else they could not normally be privately gainful? And is this not optimism? In answer, it is to be explained that only socially gainful occupations would be held to be socially productive (in the sense indicated on a preceding page); and that the word "normally" makes a great difference. What could not exist in the long run, and is tending to cease to exist, may nevertheless exist at any given time. The fact is that the social point of view of a social-individual leads neither to optimism nor to pessimism, for it proceeds from a recognition of the interrelation of individual interests, -interests which are different, but coördinate. After this extended discussion, I cannot believe it necessary to devote much space to proving the unreality of any other than the social point of view as truly interpreted. Society is as real as the individual, — and, of course, no more real. This being the case, it is as unreal as anything imaginable to overlook the following facts: To rob is to take without giving, and cannot persist in a competitive exchange economy. To burn cotton or sink spices means wasted utilities and dimin ished product. To tax both farms and factories, on the one hand, and mortgages and bonds, on the other hand, is double taxation. To own real estate is a very different matter from owning any kind of (other ?) capital. To hold special privileges by graft is more precarious than to hold land. To be a prostitute may be productive; to be a beggar, however, is non-productive; while to be a thief or incendiary is predatory and destructive. The reality of these things is overlooked by the adherents of the lonely-individual point of view, not by economists who have recognized the importance of society. In order to have a science we must have measurable quantities. In order to measure we must compare, which, in economics, means free exchange. Thus, we get objective values. But exchange values are only possible in society, and society has been proved to be an interdependent group of individuals. Therefore, the social point of view must be taken if we are to have a science. Economics as a science of scarcity values is based upon a social point of view, made true to life by recognizing its expression in individual valuations and activities. The social point of view means, not ethics, not art, not utopian hypotheses, but, on the contrary, it means a scientific recognition of the cold indisputable facts that inasmuch as individuals live in society (1) they must and do make their valuations and acts in view of their posterity and the longer life of the group, and (2) they must and do make their valuations and acts in view of the greater scope of the reactions caused within the group and the different supply limitations. In short, to the individual, time and space and value are what they are partly because society is. LEWIS H. HANEY. UNIVERSITY OF TEXAS. SOME ECONOMIC ASPECTS OF THE NEW LONG AND SHORT HAUL CLAUSE 1 SUMMARY Early interpretation of this clause, 323. I. Cases in which relief is granted; the general policy, 325. — Roundabout lines, 327. Crosslines, 328. Market competition, 330. The parallel of a protective tariff, 332.-II. Extent of relief granted, 333. Recent trans-continental rate cases, 334. - The zone method criticised, 335. — Conclusion: the margin of tolerance and the Commission's ideal, 336. - WHEN a statute has been suddenly revived after a sleep of twenty years, we cannot help wondering whether it has, like Rip Van Winkle, been much changed in the interval. In the early days of struggle for existence, the Interstate Commerce Commission was waging a losing fight in the mere attempt to give to the "long and short haul clause" some meaning and force. Now it feels free to give the clause what meaning and force it will, subject only to constitutional limitations and to the guiding principles of reasonableness expressed in the statute. Then as now, the Commission had power in special cases to permit any carrier to charge less for a longer haul, and to "prescribe the extent to which such designated common carrier may be relieved from the operation of the section." But whereas at present this power to relieve is the central fact of the fourth section, previous to 1910 it was from force of circumstances a dead letter. 1 For a general survey, see Ripley, Railroads: Rates and Regulation, pp. 473 ff., 564-566, and chap. xix. The present study is more limited in scope, paying especial attention to the cases of 1912-13. R. R. Com. of Nev. v. S. P. Co., 21 I. C. C. R. 329, 340. No sooner was the act of 1887 in operation than many carriers took the ground that competition of any sort at the more distant point was a substantially dissimilar circumstance, and entitled them, not to relief in the discretion of the Commission, but to complete exemption. If this sweeping claim could be made good, no special relief need be asked for, since all the cases in which it could be of moment, or in which there was any great probability of its being granted, would be already taken out of the hands of the Commission entirely. So the question of authority had first to be fought out. In defending its jurisdiction the Commission became more uncompromising than at the outset as to what were "substantially similar circumstances." It held, for purposes of giving vitality to the act, that nothing but competition of water carriers or of rail carriers not subject to the act could remove any rate from its operation,' tho in the first case heard it had conceded that the roads might be entitled to exemption "in rare and peculiar cases of competition between railroads which are subject to the statute, when a strict application of the general rule of the statute would be destructive of legitimate competition."2 Whether or not this change of front was a wise tactical move, it probably had little effect on the outcome. In any case it is hard to see how the power to grant partial relief could have been anything but a dead letter in the incongruous setting of the original fourth section. The power could not be exercised arbitrarily, without reason given, for then the Commission would be open to the charge of exercising legislative powers which Congress could not constitutionally delegate to it. Only as it should follow the general rules of the act 1 R. R. Com. v. Clyde S. S. Co., 5 I. C. C. R. 324. Reviewed in 21 I. C. C. R. 414. In re L. & N. R. R. Co., 1 I. C. C. R. 31. |