Popular welfare is bound up with the conduct of business; because industry is managed for business ends, and also because there prevails throughout modern communities a settled habit of rating the means of livelihood and the amenities of life in pecuniary terms. But apart from their effect in controlling the terms of livelihood from day to day, these principles are also in great measure decisive in the larger affairs of life, both for the individual in his civil relations and for the community at large in its political concerns. Modern (civilized) institutions rest, in great part, on business principles. This is the meaning, as applied to the modern situation, of the current phrases about the Economic Interpretation of History, or the Materialistic Theory of History.
Because of this settled habit of seeing all the conjunctures
of life from the business point of view, in terms of profit and
loss, the management of the affairs of the community at large
falls by common consent into the hands of business men and is
guided by business considerations. Hence modern politics is
business politics, even apart from the sinister application of
the phrase to what is invidiously called corrupt politics. This
is true both of foreign and domestic policy. Legislation, police
surveillance, the administration of justice, the military and
diplomatic service, all are chiefly concerned with business
relations, pecuniary interests, and they have little more than an
incidental bearing on other human interests. All this apparatus
is also charged with the protection of life and personal liberty, but its work in this bearing has much of a pecuniary color.
Legislation and legal decisions are based on the dogma of
Natural Liberty. This is peculiarly true as regards the
English-speaking peoples, the foundation of whose jurisprudence
is the common law, and it holds true in an especial degree of
America. In other European communities the sway of natural rights
preconceptions is not so unmitigated, but even with them there is
a visibly growing predilection for the natural-rights standpoint
in all matters touching business relations. The dogma of natural
liberty is peculiarly conducive to an expeditious business
traffic and peculiarly consonant with the habits of thought which
necessarily prevail in any business community.
The current body of natural-rights preconceptions antedates
the modern business situation. The scheme of natural rights grew
up and found secure lodgement in the common sense of the
community, as well as with its lawgivers and courts, under the
discipline of the small industry and petty trade ("domestic
industry") whose development culminated in the eighteenth
century.(1*) In industrial matters the efficient and autonomous
factor in the days of the small industry was the individual
workman, his personal force, dexterity, and diligence; similarly
in the petty trade of the precapitalistic English situation the
decisive factor was the discretion and sagacity of the small
merchant and petty employer, who stood in the direct personal
relations with their customers and their employees. In so far as
trade and industry was not restrained by conventional
regulations, statutory or customary, both trade and industry was
in effect an open field of free competition, in which man met man
on a somewhat equable footing. While the competitors were not on
a footing of material equality, the industrial system was
sufficiently loose-jointed, of a sufficiently diffuse growth, to
make competition effective in the absence of mandatory
restrictions. The like will hold of the business organization
associated with the small industry. Both trade and industry were
matters of personal efficiency rather than comprehensively
organized processes of an impersonal character.(2*)