Come let us reason togethor

Jeremy Hubble
February 2, 1992

The great economists of our time have never achieved the respect of their contemporary military leaders; yet their ideas have had a far more profound effect on the actions of men, and have lead to some of the bloodiest revolutions on earth. However, it took thousands of years before the world would be ready for the emergence of the "worldly philosophers."

Ants live in colonies, almost totally devoted to the good of the their fellow ants. Cats privately stalk out their own territory, fending off any other animals. Man, however, is neither a cat nor a fish. He is both. He struggles to maintain his individuality, while still depending on others. Early man overcame his self-centeredness in order to survive. He depended on group work to obtain his food. Today, only a small percentage of people are involved in the direct production of subsistence needs. Even though most men never touch soil, man's society has still managed to stay intact. A remarkable feet indeed, considering that there is nothing forcing the farmer to plant crops for everyone, or the shopkeeper to keep convenient hours. In fact, the primary reason that man continues to cooperate is due to his own self-centeredness. Men drift towards the areas that they are most needed because those areas often have the most rewards.

In the ancient societies, however, society was held together by a stronger glue. The Indians were required to assume a job based on their caste. The Egyptians had even less of a choice; they were religiously bound to pursue the same occupation of their father. This direct control, like the command economies of today, theoretically ensured a job for everyone and a filling of society's needs. Man was commanded to assume an occupation either by the force of tradition or by a higher authority. Competition was taboo in the society, and everyone was forced to work as a community. These systems were destined to fail because they failed to respect man's nature as an individual. Man refused to produce a better shoe because he wouldn't get anything out of it. In fact, he may even receive a public reprimand for causing 'extra work' for the other shoemakers.

It wasn't until the late 17th century when man began to employ the modern method, the market system. In our system, very few people are 'forced' to do anything. They have freewill to make their own decisions, and pick their own jobs. He is encouraged to use both aspects of his dual nature. He'll work to provide for society's needs by providing the service that society most demands. For the most part, he can hold an occupation that he enjoys, and receive enough compensation to provide for his other needs. Thus, the market system is the most effective economic system that we know of today.

Though the market system is relatively new, markets have existed for some time. As far back as 1400 BC, records tell of gold and chariots being traded for slaves and horses. However, these small trades are only remotely related to the modern market system. Today, anything can be indirectly traded (with the 'money' middleman) for anything else. A farmer may use the money obtained from chickens to buy a painting. Such a trade would probably be impossible in ancient markets. Ancient markets were merely a limited method of exchanging goods. Today's market system is much more. It is "a mechanism for sustaining and maintaining an entire society."

With the many benefits of allowing man to receive his own gain, it seems amazing that it took man so long to discover the modern market system. Moreover, through most of history, profit has been decried. In 1639, Robert Keayne committed the great sin of avarice. He sought riches for riches sake - earning a sixpence on a shilling. This profit, now seen as mediocre, was outrageous at the time. So outrageous, in fact, that the church considered excommunication. The minister seized the golden opportunity to preach a sermon on some 'incorrect' trade principles. Among these 'faults' were points that contradicted the modern profit motive, and even the law of supply and demand.

The entire business system was much different than it is today. A man didn't have a nine-to-five job. His job was his life. Thus the business world was meshed with the political, social, and religious. There was no dividing line like there is today. Trade companies set up rules to regulate their members' personal conduct at all times. Initiative and change were discouraged. Instead, blind conformity to the standards was required. It was a sin to seek personal gain. Economics as we know it did not exist as a separate entity - it was just part of one composite world of 'everything'.

Modern man has difficulty fathoming an effective, non-market economic system. Today, the profit motive is the predominant factor in business. Factories are built in order for companies to accumulate more wealth. The companies think of themselves first, and as an after-sight, help the economy. Today, everyone has the potential to amass great wealth. Those who succeed are often given a great deal of respect in the community. Though some may publicly attack the wealth, they would gladly trade places with them. Our society has taken a view of wealth entirely different from that of earlier societies. Even so, there are still many other societies, especially in the third world, that are unaccustomed to the concept of wealth accumulation. Instead of working harder in response to wage increases, they will take more time off. Instead of elevating themselves with wealth, they let their standard of living stagnate in epicurean pursuits.

The primary reason for the stagnating standard of living was the iron-cast social system. The middle age peasant had no hope of becoming a noble. Thus, he saw very little use for increased wages. Furthermore, even if he did have a significant amount of money, they couldn't buy land. The landowners wouldn't sell it. Their view of land ownership was similar to our modern territorial rights. Land was not only the landowner's property, but also the center of life on his manor. A property exchange would only take place on rare occasions, with many 'strings' attached. Similarly, the medieval labor force was looked into a the service of a lord. They did the lord's bidding, rarely thinking about obtaining employment elsewhere. The land and labor force were all tied together in the service of a lord, and would rarely change hands. Furthermore, the 'capital' that existed in the medieval manor was rarely put to aggressive use. Instead of trying innovative, new processes, the lord would carry out the methods that were the longest, safest, and most labor-consuming. Thus, the medieval society lacked the three key ingredients of a market economy - land, labor, and capital.

In the late seventeenth century, Europe underwent a gradual metamorphosis that enabled a market economy to appear. First, the guilds had to be 'deregulated'. Previous regulations that encouraged unchallenged conformity, and discouraged innovation had to be challenged. The first battles came resulted in bitter-sweet victories: innovations were allowed, but only after prior approval by a board of elder guildsmen. Methods of mass production also had to struggle for years before they reached widespread approval. The labor force also had to be freed from their manorial confines. Luckily, the interest in wool farming began resulted in fencing off of land, and a 'freeing of the peasant farmers. Some peasants were given small estates of land to farm. Unfortunately, without the 'manor' communities, the evicted farmers could barely survive, so, many roamed the country as paupers until the market system's need for labor appeared.

Changes in the political and religious systems also encouraged the market system. Countries soon became unified under centralized leadership. The centralization cut back on the endless amount of rules and regulations faced by merchants as they traveled from estate to estate. The Protestant Reformation and the decay of the centralized church helped to encourage wealth. The catholic church did not like the merchant and was adamantly against the accumulation of wealth. The protestant churches, however were more lenient on these matters. In fact, many encouraged business as a proper way to use one's God-given talents. They also viewed acquisitiveness as a way to help further the glory of God. The increase in scientific curiosity also helped spread the market system. New innovations appeared, and inventors soon gained much needed respect. With the gradual appearance of a market system, those who understood money, such as merchants and accountants, gained more power than the nobles who didn't.

With the birth of the modern economic system there was a need for a new branch of philosophy was created. Instead of being controlled by the dictates of the lords, everybody had an equal stake in the control of the economy. The new economic philosophers filled man's basic need to explain how the market system worked, and why it was the best of all systems. An economist was needed to explain what effect the rapid changes would have on society. The new philosophers postulated many contradictory ideas on the need and use of the economic systems. Some saw poverty as good, others as a menacing evil. Some were adamantly in favor of widespread trade, others wouldn't mind seeing it disappear. However, even with their differences, they were all filling the same goal. They each sought "some sort of intellectual ordering to help him understand the world in which he lived." And, as Dr. Samuel Johnson said, "There is nothing which requires more to be illustrated by philosophy than trade does." After years of change, society finally had a void ready to be filled by the economists.