home and abroad, and he considers that men have a natural right to dispose of their labour and its product wherever and in whatever way they individually think best. The State exists mainly for defence of life and property and for the administration of justice, though it must also undertake public works, that would be left

undone without its aid.

The doctrines of Political Economy are not fully considered in detail. The distinction of luxuries and necessaries, which had been brought into prominence by Mandeville and Hume, is recognised; but it was left to Malthus to show its bearing on the increase of the numbers of the people. The doctrine of value is sketched after the French Economists without the application to rent made by Adam Smith's successors. But there is no part of the subject that is not presented in some part or other of the Wealth of Nations, and one part at least (on taxation) not only in detail but systematically. In point of comprehensiveness, even Steuart's large treatise is inferior to his compatriot's. Adam Smith has exercised as momentous an influence on political economy as his friend Hume on metaphysics; and it is striking that the philosophy, which was by and by to grow out of a critical study of Hume, was destined at a later date to affect the political economy which grew out of a study of Adam Smith.

The next step in political economy was taken in face of a new Utopia of political philosophy, a proposal to do without the State altogether. The idea of following nature and dispensing with institutions, proposed ironically by Burke in his Vindication of Natural Society, is carried out seriously by William Godwin in his Political Justice. Society, as the spontaneous growth of Nature, is to stand alone without the State. Governments have

injured not only trade, but every branch of human activity. The ideal is a simple society without society without government. The progress of enlightenment and the victory of truth will slowly but surely lead to a happy world, where plain living and high thinking will prevail, and there will be deliverance from passion and a sufficiency of leisure and comfort for all born into the world.

Malthus interposed with the criticism that there was

no sign in men of such a disappearance of the passions and complete supremacy of reason. One passion in particular, the desire of marriage, would lead to consequences fatal to Godwin's society. When pressed, Malthus admitted that reason could be so far victorious as to put a "moral restraint" on this passion, deferring the satisfaction of it to save the standard of comfort. But it seemed to him that this restraint itself would be better fostered by the usual inequality of civilized men than by the equality of Godwin's ideal society.

Malthus brought into political economy that Utilitarian emphasis on consequences which has played a great part in it ever since. He also associated political economy with laws that were laws of nature, not in the lawyers' sense, but in the sense of the physical sciences. In the third place, he discredited the reference to natural rights, including the right to live and the right to labour. He showed that physical nature and human nature stood more seriously in the way of progress than human institutions, political and otherwise. Yet by throwing men back on their responsibility as individuals, he is more at one with Godwin and the French philosophers of the 18th century than he ever himself acknowledged. The same is true even of Bentham. Yet Bentham's criticism of natural rights and law of nature, as they were conceived at the end of the 18th century, was so searching that, in England at least, it has stood in the way of any such revival of these ideas as has taken place in Germany.

In place of them, Bentham introduced "the greatest happiness of the greatest number" as the test not only of good morals but of good legislation. He was supported by James Mill and Ricardo among economists, and the Utilitarian doctrine, as he held it, gave colour to economical writing for the next half century. The points of contact were the predominance of self-interest in the sense of regard for material prosperity, both in abstract economics and in the Utilitarianism of Bentham-the political individualism of both, the common assumption that human action is due to deliberate calculation, the common assumption of the boundlessness and indefinite expansion of human wants, the common use of a calculus of pains and

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pleasures, and the common assumption of the infallibility of the individual where the individual's interests are concerned. It can perhaps be shown that these are not necessary assumptions even of an abstract political economy; but the Utilitarian philosophy of Bentham was forced into union with economics and applied to politics. by a group of men who strongly impressed their generation. James Mill, in applying these principles to the theory of government, argued that the end of government was to bring about such a distribution of the "materials for happiness" as would ensure the greatest sum thereof to its subjects, and it can best do this by increasing the inducements to labour, for without labour niggardly nature will yield us little or nothing. Now, the best inducement to labour (he says) is the securing of the fruits of it to the labourer; government therefore exists for the protection of the labourer against spoliation; in other words, it exists to protect property. Under such a government men following purely their own interests will further the public interest. James Mill allows that in international law we have to appeal to other motives, and trust to the respect men have for the praise or blame of their fellows; and he ought to have allowed for this element in the relation of subjects to sovereigns as well as of nation to nation,-while, as his son saw, he ought to have paid more regard to the "rights of minorities." The tendency of economists to confide in large numbers and averages, and to appeal (under cross-examination) to what will happen "in the long run" has been fortified by the old formula of Bentham. But Utilitarian political philosophy, in claiming Greatest Happiness for the majority, aided political reform in the direction of equality, and introduced a rough working test by which existing institutions must stand or fall.

John Stuart Mill, on whom fell his father's mantle, ceased to be a follower of Bentham and yet remained (in his own opinion) Utilitarian. But in ethics he admitted at difference in quality between pleasures, and therewith a non-utilitarian standard. In political philosophy he was led by the influence of French writers to recognise the impossibility of treating societies and States as if their component units were everywhere alike and all equally

modifiable by legislation and argument. In his economics a similar concession is made, though the provisional necessity of an abstract method is firmly reasserted. Political economy (he says) deals with the "laws of such of the phenomena of society" as relate to wealth so far as those phenomena are not affected by other motives than the pursuit of wealth. But in reality he has two conceptions of economic laws; there are the laws of production which are analogous to physical facts, and the laws of distribution which are of human institution, and therefore modifiable and in a sense arbitrary. The latter include such laws as necessarily follow from institutions once established (such as private property), even if the actual establishment of them be nowise necessary or always desirable. The laws of value and prices for example are thus hypothetically true for all societies. On the other hand, Mill has much to say on behalf of the contentions even of the Utopian socialists and communists. He refuses to put limits to the future possibilities of social union and communion; in this sense he is no adherent of Cobden and the Manchester School of political writers. None the less he is careful to protest that whatever action is taken by the State the personal liberty of the individual must be jealously maintained; and he considers that the individual is even now too much under the coercion of society, to say nothing of the State; prejudice, for example, has maintained the subjection of women." In claiming for women the same opportunities as for men, Mill has helped to widen our ideas of social progress, and made not only political but economical problems wear a new aspect.

In the up-building of economic theory Mill's work is less important. There is some ground for the charge that he is an eclectic, as well as for the charge that he is a formulator. The next step in economic theory was (in England at least) taken by economists who remained Utilitarians and based a theory of value as determined by Final Utility on Bentham's calculus of pleasures and pains. Mill, like Ricardo, excluded consumption from economics, and had no distinct glimpse of the new doctrine of Value. Ricardo had said the last word on the

He thought that subject. Ricardo

indeed has been the Spinoza of economic theory. Yet value, as a central economic doctrine relating to a central social problem, that of distribution, demanded the most searching investigation, and could not receive it except in connection with consumption.

In such an investigation twenty years ago or so, German and English economics found their point of convergence, After the common impulse given to both by Adam Smith and Ricardo, Germans and English had seemed to follow separate paths, as they have so often done in philosophy. In both countries, the phase of economics now reached has been largely even if indirectly affected by the philosophy.

German metaphysics made a new departure with Kant's Critique of Pure Reason in 1781, and German Ethics with the Metaphysic of Ethics, 1786, and Critique of Practical Reason, 1788. But political philosophy was not so well served by the Königsberg philosopher. In his Rechtslehre (1796) Kant teaches that Civil Society exists to secure the outward freedom, not the happiness of its members. The rational (though not necessarily the historical) basis of the State, is an original contract by which all give up their natural liberty to secure civil liberty and are bound to give absolute submission to the ruler they have chosen. Kant's notion of the State is not very different from Adam Smith's; it is to be keeper of the peace and protector of property. Law is separated by him from Morality as, in Adam Smith and Hume, Justice is deemed unlike any of the other virtues. L Kant looks forward to a Universal Peace, and thinks that trade will be a chief means of introducing it. "Nature," by a mechanism which is non-moral, will thus bring about a result demanded by the moral law. The individual looks after himself; nature provides for the race; and nature will one day secure that all human capacities shall be developed, in a cosmopolitan civil society. The development of the race in history will be slow and sure.

This notion of Development was expanded by Fichte, and still more by Hegel.

Fichte, agreeing with Kant in the severance of law from morality, goes far beyond him both in politics and