The rights of life, liberty and property must first be dear to the mass of the people before laws can be framed for their protection. This is especially true in a self-governing people, but is essentially the same in the most absolute tyranny. So the chief safeguard for every kind of business is the honest character of all business men, and such influences as establish good character and sound judgment will be fostered on the simplest business principles. The farmer who sells his grain or his fruit by false samples cannot complain of false weights and measures at the elevator. The one who gloats over victory in a horse trade has no right to grumble at a trickster in wool buying. The man who is caught by the offer of a gold brick is not only foolish, but false, and diminishes the security of himself and everybody else in fair bargains and genuine business. The man who takes advantage of his ignorant neighbor deserves to be at the mercy of a more crafty dealer. Every one who makes a false use of power over a workman beneath him may expect a false use of power from an authority above him. So all business interests, as well as all rights, are secured by the right spirit in all men.
_Nature of insurance._--The fundamental activity in accumulation of wealth is foresight; but no foresight can prevent all disasters. Fire, flood, wind and wave are beyond control, because in some sense they are beyond knowledge. Against such forces no foresight can secure. The name insurance is given to every method by which the burden of such unforeseen losses is provided for beforehand and fairly distributed. The average of such losses can easily be estimated by experience. Statistics show a wonderful uniformity in the misfortunes of life as well as, the fortunes. Even though chance be an element in every transaction, the average of chances can be distinctly calculated; and that average is essentially constant among a sufficiently large number of instances.
All are familiar with the application of such calculations in fire insurance. Among ten thousand houses a certain number will be destroyed by fire every year, provided those houses are widely distributed under essentially similar conditions. The ten thousand house owners can insure each owner against entire loss of his house by mutual agreement to meet their share of the total loss. If ten houses are burned, each of the ten thousand house owners will pay one-thousandth part of the total loss, making a burden easily provided for. If at the beginning of the year each has laid aside this sum, the loss will be met when it occurs without disturbing the welfare of any. The machinery for such provision is called an insurance company, and the separate payment of each house owner is the premium or award expressing his share of the provision. This principle of estimating losses and providing a definite way of meeting them is the same in all forms of insurance. It has been recognized for hundreds of years, but only recently has entered into the business life of the world in all directions. For a long time false notions of reverence for the power that wields destiny stood in the way of such distribution of misfortune; but now the mass of people everywhere regard such foresight in united sympathy as natural as the planting of crops.