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ethical action. Besides, it is so under the impulse and domination of the animal instincts that the natural wants have first to be satisfied before questions of right and wrong, outside of social relations, can be raised. The moral nature consists, at least, in the control of the animal instincts, not their suppression, and hence their satisfaction, within rational limits, from the results of production has to be granted. Production in the light of this fact becomes a necessity, not a matter of choice. Ethical action must involve a choice, voluntary and free activity. Where it is imposed by necessity responsibility, merit, and blame do not exist. Production, then, in addition to being merely action upon physical forces is rendered necessary by impulses which are neither moral nor immoral, but which are upon the same plane as physical phenomena in that respect. The laws of economics, then, as an expression either of these impulses directly or of their indirect influence, must be like physical laws, from which we exclude ethical qualities and relations. With production we have connected capital, profits, rent, interest, values, prices, etc., all of which vary with the regularity of physical law and causation. They seem to be independent of the human will in their character and occurrence. Questions of ethics, therefore, seem to be excluded from the case. Production, so far as it is effort expended upon physical forces, then, is not ethical, and hence apparently its laws and incidents would seem to be excluded for the same

reason.

There is much truth in this claim, and production, with its incidents of rent, interest, values, wages, etc., occupies so large a field of economics as to set the way of thinking about the whole subject. But, after all, just where it touches upon the question of property it is inextricably interwoven with ethical problems. At this point also the human will and its influence, apart from mere animal impulses, are introduced to reaffirm the solidarity of the two sets of phenomena. Rent, interest, and value are illustrations of this. They are supposed to be so thoroughly under the influence of natural laws as not to involve the effects of volition and desire. But as a matter of fact they are so complicated with all forms of desire, instinctive and rational, that ethical data enter into the problem. Rent, for instance, involves two factors, usually summarized in the productivity of capital, or rather land first, the difference between supply and demand involving the pressure of human desire on the one hand, and the fertility of natural resources on the other; and second, the power of the

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owner over his property to affect the pressure of demand and fix rent to suit his own will. This is the power of monopoly and violates the freedom of contract. It is the same with interest and values, and the experience of the human race with the evils of usury is a proof of the fact. History for a hundred generations at least shows that laws against that abuse have had to be enacted to prevent the wrong of one man by another. If rent and interest were determined solely by physical laws and conditions it would be absurd, yea, more, impossible, to affect them by government interference. But the undoubted abuses connected with them are a proof that they are not determined solely by economic laws, but are so interwoven with data of a moral character that economics and ethics cannot safely be divorced from each other for any purpose, except abstract science. In spite of all differences which, when urged alone, conceal a common territory, the two sciences, at the very point by which they seem wholly distinct from each other, are inseparably and mutually involved.

But if production and its incidents cannot escape a connection with ethical problems, this interrelation of the two subjects is still more true of the field defined by distribution. This is recognized as a part of economics equally important with production, although its incidents do not occupy so large a space as those of production, and on that account, as we have remarked, the ethical phenomena of the subject may be obscured by the predominance of those which seem to be regulated by causes as invariable and as unalterable as physical forces. But distribution is a social phenomenon. It does not, like production, create wealth, nor does it, like the same act, confine its application to natural resources. It does not modify them, and creates no utilities, although it does affect values. It exchanges products from hand to hand, and essentially involves an interchange between persons, assuming, as we do here, that distribution includes exchange. The relation expressed by it is that between persons, not between persons and things, and all social relations are ethical. Distribution affects exchangeable or commercial value by the amount of labor required to effect a transfer, but it does not affect utility or intrinsic value, the power of wealth to satisfy physical wants. A bushel of wheat will supply no more wants in London than it will in Chicago, although it may cost much more in the former than in the latter, as much more as the cost of labor in accomplishing the transportation of it from one place to the other. This exchange is simply an exchange of labor, and involves ethical considerations. The

work of producing the bushel of wheat is not so manifestly ethical, because it is effort expended upon a material force, but distribution and exchange are actions involving personal relations between two or more individuals. They involve mutual contracts between two parties. All conduct affecting two persons, or expressing an agreement between two persons, can have no other than an ethical standard to regulate it. Equal services, although expressed in an economical form, are nothing but an ethical principle, and constitute the only legitimate basis upon which distribution and exchange can be conducted. Rights on the one hand and duties on the other are supreme here. This equality of services is only another form of justice, and hence exchanges cannot take place independently of it, and cannot be disregarded in adopting and recommending rules of action embodying economie laws. Hence the economics of exchange deal with a social phenomenon, where, if ethics is excluded, social and moral confusion are the result. The very language of political economy in the discussion of this subject expresses the equality of services, or implies it, and thereby comes into contact with morals. Whatever

it may do as an abstract science, as an art, or as a conception in practical life, it cannot ignore this characteristic of legitimate exchange any more than it can ignore the fact of exchange itself. The moral factor is there to make itself felt, and any attempt to disregard it only results in taking conscience out of business. This is very clearly illustrated by the differences of character between rural and urban populations. The former make up the agricul tural community and are engaged mainly in production, the expenditure of labor upon natural resources, and so are less frequently tempted to profit by the inequalities often existing in the conditions of exchange. The urban populations are mainly centres of distribution, except as they are employed at manufacturing. But even this is conducted so that it comes more under the influence of the moral principles regulating exchange than those affecting production. Now the rural populations have been in all history the backbone and moral fibre of civilization. Being producers mainly, and able to supply their wants from that source rather than at the expense of their neighbor by unequal exchanges, they were under the influence of a moral force that counteracted all temptations to injustice in their exchanges. But the great marts of exchange are simply systems of cut-throat competition and commercial war. Business in such centres, although mutual exchanges do not necessarily involve an injury to one of the

parties to them, generally represent at least an attempt to produce that effect, and we know too well that great fortunes are made precisely in that way. Some advantage is taken by one party against another. As the profits will be proportioned, and can only be proportioned, to the inequality of the exchanges made, because the activity is not productive, the temptation is to throw ethics aside and make business a system of organized cheating, and as it is extremely difficult, in a world where desires are so diverse and unequal, to draw any moral line for regulating commercial procedure, those who are without a conscience will respect no law of justice and right which is not enforced by the civil courts, and will meet every remonstrance with the maxim, that "business is business." In the end they determine the conditions of success for every one, and make urban centres of population masses of individuals fighting against each other instead of joining in a common brotherhood for mutual help and production and for directing their combined energies against the forces of nature. The competition and struggle for getting the advantage of each other is greater in such places than in rural communities, and when the mind is absorbed in efforts to beat one's neighbor instead of cooperating with him, conscience becomes callous, and business becomes a lottery or a war. Morals are impossible in such a

condition. But this contrast between rural and urban life commercially is a proof of the immoral tendencies incident to distribution and exchange, and it illustrates the case on a large scale.

But if this does not suffice to indicate a common ground for ethics and economics and the fact that they are correlated sciences and arts, a few special illustrations of a different kind will prove it. If the two subjects have nothing to do with each other, it must follow that economic and ethical action can be kept entirely distinct, and although this may be doubtful, the practical effect would be, as we have remarked, to grant immunity to immoral action on the plea that, in conformity with good economics, it should be exempt from the restraint of ethics. But the consequences of admitting such an exemption would at once open our eyes to the intimate relation existing between the two subjects. For instance, what is to be said of the local discriminations so long practiced by our railways in regard to freight rates? Have they no ethical import, although in no respect a violation of economic laws as conceived by the pure economist? The incidents will answer for themselves.

The New York Central at one time charged sixty-five cents a tub for freight rates from a point 165 miles away, while the rate from Elgin, Illinois, more than 1,000 miles away, over the same road, was thirty cents. This practically put farmers and dairymen at the former distance farther away from the New York markets than those of Illinois. The injustice of the policy is self-evident. If there was a sufficient and legitimate profit to the road in the rate of thirty cents, the sixty-five cent charge was extortion and robbery. If it was not sufficient, the policy was one of robbing either the stockholder or the farmer; the former to keep up the road, or the latter to make good the loss entailed by the thirty cent rate and to compensate the stockholder. The same remarks apply to like incidents which we mention for the sake of showing to what extent such injustice can be inflicted, and how ethical phenomena are interwoven with the economical in the process of distribution. At one time the charge for a barrel of flour from Chicago through Pittsburg to Philadelphia was twenty-five cents, while the charge from Pittsburg to Philadelphia was forty cents; and in regard to iron manufactures it was possible to mine both the ore and coal near Pittsburg, ship them through that city, paying the freight, to Chicago, manufacture the ore into salable products and undersell Pittsburg manufacturers, so great had been the discriminations against the products of the latter. So unequal were freight rates on certain articles in Pittsburg and New York that it was cheaper to ship them to New York, paying the freight, and reship them from this place back through Pittsburg, than it was to ship them direct from the latter place. In the same line a writer states the following incident: "Mr. W. W. Mack, of Rochester, N. Y., instead of shipping his edged tools direct, sent them first to New York, whence they passed back by way of Rochester to Cincinnati and St. Louis, at a saving in the one case of fourteen cents, and in the other of eighteen cents, per hundred." From Chicago to Virginia City, Nevada, the freight rate for hardware was $800 per car; to San Francisco, 600 miles farther, it was only $300. From Memphis, Tennessee, to New Orleans, a distance of 450 miles, the charge per bale on cotton was $1, while from Winona to New Orleans, a distance of 275 miles, the charge was $3.25 per bale, taking the distance into account, a charge of more than five times the former case.

Such instances could be multiplied indefinitely, but every one is familiar with them and with the recent " Interstate Commerce Act" of Congress to put a check to such discriminations. We have clear

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