The Flight from Reality 20: Meliorist Economics; C. Carson

an "economics" which purports to show that free economic activity leads to contradictions, that to re move these contradictions govern ment action is necessary, and that certain kinds of· actions can be taken which will have the desired effect. Such pseudo-economic the ories are here called meliorist economics. It should be noted, however, that the phrase, "meliorist eco nomics," is used for historical reasons and consistency, not be cause of its descriptive accuracy or aptness. Throughout this work, meliorism refers to the view that government intervention can im prove conditions for people. Me liorist economics is an "economics" which purports to justify govern ment intervention in an economy and show how it can be done so as to improve the material well38 34 THE FREEMAN May being of people generally. This latter usage of the term - to mod ify economics - is not commonly employed, if it has ever been used in this way before. It is, however, consistent with the practice in this work of referring to reform ism in general as meliorism.

... But It Wasn't Economics The term, "meliorism," was adopted by some reformers within the context of controversies of the latter part of the nineteenth cen tury. Most of the influential econ omists and social thinkers of the nineteenth century had held that government intervention would prod uce evils rather than cure them. Karl Marx, along with rev olutionary socialists in general, held roughly the same position, though for different reasons. In addition to these views about an ameliorative use of government, social Darwinists held that men could not alter the course of evolu tionary development, and that gov ernment intervention would fail in any attempt to tamper with evolu tion. Meliorism, running counter to all these views, insisted that government could be used to improve conditions. In this context it is quite cor rect to refer to proponents of gov ernment intervention as meliorists.

In like manner, it is proper to re fer to theories in an economic vein along these lines as meliorist eco nomics. It should be made clear, however, that in essence such eco nomics is not ameliorative, nor is it in essence economics. Instead, it consists of theoretical and ideo logical justifications for using the power of government to take from some and give to others. Under stood rightly, it consists of more or less subtle attempts to legalize theft. A little basic economics should make this clear. Economics has to do with increasing the supply of goods or services with the smallest expenditure of materials and energy. For an individual and economic action is, in the final analysis, the action of an individual or a group of individ uals - economics is of importance to him to the extent that he wishes to conserve his supply of materials and energy and increase his sup ply of goods and services.

There are two ways for an indi vidual to augment the goods and services at his disposal. (1) He can produce or provide therrl for himself. (2) He can acquire them from others. Again, there are two ways for an individual to acquire them from others. (a) He can acquire them by exchange (which would include gifts, though what is exchanged may be different in character from what is obtained). Or (b), he can take them from 1966 MELIORIST ECONOMICS 35 someone else who possesses them. This latter method is the one that is the chief concern of meliorist economists. Theft and Enslavement Inherent in Compulsory Exchange Everyone understands that when one individual uses force or fraud to take goods from another, theft is involved. When an indi vidual uses force to make another serve him, it is called slavery. But it is not generally understood or accepted that when meliorist eco nomics is applied in society, theft and slavery are entailed.

In the main, this lack of under standing can be attributed to the indirectness, the subtlety, and the sophistry of the-methods of meli orist economics. Men are led to be lieve that public approval somehow changes the character of an action, that confiscation of goods by pub licly elected officials is not theft, that the democratic process can be used to legitimize acts which are in themselves illegitimate. Men do not readily understand that the protective tariff is, in effect, the taking of wealth from the con sumer for the supposed benefit of the producer, that antitrust suits are subtle assaults upon property, that inflation is a surreptitious theft of money from those who have it or have it owed··to them, that compulsory unionization legalizes the taking of money from some by others, that minimum wages and maximum hours are at tempts to take from somewhat is rightfully theirs and give it to others, that to take wealth from some portion of the population and bestow it upon some other portion under the guise of welfare is not even a very subtle form of thievery.

The story thus far, in this work, has been an attempt mainly to ex plain how men's minds were pre pared to accept such things with out recQgnizing them. Men have been taught to take their eyes away from the nature of things and to focus upon the purported object or end for which an act has been performed. They have been taught that it is the motive that counts, not the consequences of the act. They have been taught that morals - and even the lan guage used to describe them -are relative to a given society. If this were so, only that which the gen erality of men understood to be theft would be theft; only that which was recognized as slavery would be slavery. If the majority voted for a measure, or for those who proposed a measure, this would be indicative of its con formity to morality. After all, one may argue from such premises, whatever the majority accepts as right is ipso facto right.

36 THE FREEMAN May Robbery Is Antisocial; One Man's Gain is Another's Loss Morality aside, and speaking strictly in terms of what may be economical for an individual, rob bery could be quite economical. By stealing, an individual can great ly augment the supply of goods and services available to him with only a very little expenditure of energy and materials. A bank rob ber may spend half an hour using a twenty-dollar gun and enrich himself, say, to the extent of $20, 000. Of course, such usage is an abuse and perversion of the con ventional term "economy." Eco nomics, as it comes to us from the classicists, is a social study, not an antisocial one. It has to do with what may be economical Dot only for an individual but f or all other men as well. The bank robber increases his supply of goods and services at the ex pense of those of other men. Moreover, he may actually re duce the general supply by the threat he poses to trade and the loss of incentive men have to pro duce when they are uncertain that they will be able to keep there wards-of their labor . For these reasons, theft has not been con sideredeconomical. Of course, in most societies such penalties have usually been attached to the prac tice .as '. to make it uneconomical.

The point is important, however, for understanding what hap pens when meliorist economics is applied within a society. Individ uals do not cease; so far as their understanding goes and as a rule, to behave economically in their own affairs. Indeed, a new pros pect for "economic" behavior is opened up, for certain kinds of theft are legalized. Men may bene fit at the expense of others with impunity in certain definite areas. That such behavior is uneconomic socially, plus being immoral, will not hinder a great many men in their conduct,for what they are doing may well be' socially ap proved. An example from the contem porary scene of behavior that is "economic" for the individual at the expense of others may clarify the point. Suppose one is a cotton farmer. The price of cotton is held higher than it would otherwise be by a subsidy. The subsidy is paid by tax" monies, at least tem porarily. There is a "surplus" that is, more than can be sold at this artificially high price - of cot ton. The farmer will likely make his decision as to whether to grow cotton or not in terms of its prof itability when the subsidy is add ed to the-market price. It would be economic for him to do so, al though socially the effect would be to add only to the "surplus" and the general tax burdell. His profit 1966 MELIORIST ECONOMICS 37 would be got at the expense of others.

Vying for the Spoils The system which results from the application of meliorist eco nomics is one in which men are pitted against men and groups against groups for the spoils made available by redistribution. There has been a concerted effort in the United States to move this con test into the political arena and to get men to' accept peacefully the decisions made there. The art of politics becomes the art of guess ing rightly about which group to appease at what moment in order to keep the uneasy peace and main tain political power. The portion of spoils to be handed out to. any given group must be continually adjusted to take into account both the temper of the group involved and its leverage in maintaining a majority for the politician and party in power. The story of such maneuvering is largely' the story of politics in America in the twen tieth century. Meliorist economics is the body of pseudo-economic· theory which purports to justify such a system and provides the politician with the methods for establishing and maintaining it. The true nature of these activities is largely con cealed behind a cover of words which' not only obscures what is going on but reduces discussion of economic matters to high-flown gibberish. The gibberish is then ascribed to the intricate complexi ties of our times. The general flight from reality prepared the way for the wide acceptance of such obfuscations, and socialists added confusion to nineteenth cen turyeconomic thought by turning the traditional economic concepts to their ends.

All Schemes Rest on Monopoly A casual examination of melio rist economics might lead to the conclusion that there are a great diversity of economic conceptions involved. Indeed, names have been given to a number of schools of economics: e. g., socialist, histori cal, revisionist, Marxist, institu tionalist, Keynesian, and so forth. But most, or all, of these schools have a common denominator; they have a common conception from which they start or with which they end. Of course, they share the conception that the "system" - 1. e., capitalism - has internal contradictions which lead to dire consequences. But back of this is a key conception which purport edly accounts for' these. contradic tions. The key conception is mo nopoly. In ·the later part of the nineteenth and in the early twen tiethcentury, reformers sawmo.;. nopoly under every bed, as it were.

38 THE FREEMAN Ma·y There were transportation mo nopolies, industrial monopolies, land monopolies, money monopo lies, and trade monopolies. The for mula tion of these conceptions ranged from Karl Marx's view that the private ownership of the means of production led inevitably to a class monopoly of production to John Maynard Keynes' subtle no tion that profit taking and saving led to shortages of investment money which, in turn, produced depression. However remote these ideas may appear to be from it, they are rooted in a conception of monopoly, and amelioration is to be achieved by breaking up the monopoly. An Exclusive Privilege Monopoly is· a very slippery word; therefore, it must be handled with care. It is derived from the· Greek, and means, ety mologically, the exclusive right of sale. However, it had a much narrower connotation than this in earlier conventional English usage. An article in the Encyclo paedia Britannica says, "The term monopoly, in its early usage, was applied to grants from the Crown, to a favourite or as a reward for good service, of the exclusive right to manufacture or sell particular classes of goods." One American College Dictionary indicates that this has now become its secondary meaning. In this sense, a mo nopoly is "an exclusive privilege to carryon a traffic or service, granted by a sovereign, state, etc."

An unabridged dictionary calls this an artificial monopoly, which it defines as "an exclusive right granted by a government for the exploitation of anything." Odium was first attached to this kind of monopoly. But even this development has a history. Initial ly, in the sixteenth and seven teenth centuries, odium was as signed mainly to the arbitrary grant of monopolies by the mon arch. There was an attempt to re move this by taking the power of granting monopolies away from the Crown and vesting it in Par liament. Americans and English men generally accepted the pro priety of legislatures granting mo nopolies in the seventeenth and for much of the eighteenth century. However, by the time of the War for Independence there was con siderable resistance to all such mo nopolies. The resistance continued to mount in America, and by the middle of the nineteenth century, monopolies were· among the most generally despised of all human inventions.

A Perverted Terminology It was at this j uncture that so cialists began to becloud the issue with their confusions. They ex1966 MELIORIST ECONOMICS 39 propriated the odium attached to government-granted monopolies and applied it to monopoly in gen eral, in the etymological sense of the word. It is easy to see how the term could be ambiguously used to bring all sorts of things under condemnation. By the original definition of monopoly - the exclu sive right of sale - all private property is a monopoly of its owner. In this sense, every man who owns anything, whether it be a factory, a house, a barn, land, an automobile, or a pocket knife, is a monopolist. Every free man is a monopolist, for he has the exclusive right to sell his service. Indeed, it is this right, and this monopolistic condition, which sep arates free men from slaves. Socialists have been bent, of course, upon breaking up monopo lies, or, more clearly, abolishing private property. But they were notoriously unsuccessful in selling this idea to the generality of men in their early attempts. Most men were not particularly taken with the notion of giving up their pri vate property; and when they had the opportunity to vote upon the matter, they turned down such schemes unceremoniously. Social ists generally found it advanta geous to narrow down their as saults upon property to certain kinds, to use "monopoly" in a more specialized sense, and thus to divide the populace on the question of property. At any rate, gradual ists have not usually attacked prop erty directly; they have, instead, attacked what they have called mo nopoly.

The Power to Fix Prices A new definition of monopoly was promulgated in the latter part of the nineteenth century. It has since become a part of our lan guage and serves as a lens through which most people see the matter. The Encyclopa,edia Britannic'a says, "In its modern usage the term monopoly is applied to the advan tage accruing to any undertaking or associated group of undertak ings which has the power, however acquired, of fixing the price of its goods or services in the knowledge that those who need them cannot get them in adequate measure else where." One dictionary gives the following as the first meaning of monopoly: "exclusive control of a commodi ty or service in a partic ular market, or a control that makes possible the manipulation of prices." By these definitions, the exist ence of a monopoly appears to hinge on two things: that there be but one effective seller of a com modity or service in a given mar ket, and that this will enable him to fix or mani pula te the price.

(For purposes of discussion, the 40 THE FREEMAN May vagueness of such phrases as "commodity or service," "partic ular market," and "manipulation of prices" in this context may be ignored.) If such a condition were to exist, it probably could be rec ognized. If it be considered repre hensible, if it pe a matter for le gal action, the most fruitful ap proach for dealing with it would be to seek out its sources. Two Types of Monopoly: Governmental or Private There are, in reality, only two sources of such monopolies: gov ernment grant or establishment, and private ownership. Other sources are sometimes named, but upon careful examination it can be shown that they do not meet the above requirements or do not exist. Some writers refer to an efficiency monopoly. This is a case where there is only one supplier of a good or service, so that it meets one half of the requirements for a monopoly. But it is a condi tion of its continued existence that it does not manipulate prices to any significant degree. If it raises prices appreciably, other suppliers can enter the market successfully.

The other type of monopoly fre quently referred to is a natural monopoly. The phrase itself is am biguous. One dictionary defines a natural monopoly as "a monopoly arising from the possession of a part of the earth's surface, having a natural resource or resources." But this is indistinct from a def initionof private property in land. More commonly, a natural monop oly is understood to be one in which by the nature of things there can be only one supplier of a good or service in a particular market. It is often alleged that the provision of telephone service in a particular locale is a natural mo nopoly. In the first place, however, "service" is ambiguous in this us age. Is the service the providing of a telephone or of communica tion? If it is communication, tele phone service has no monopoly. One may communicate by mail, by telegraph, by radio, or go in per son. But even if the uniqueness of the telephone as a means of com munication be taken to signify that it constitutes a separate ser vice, its actual monopoly status is not natural. It rests upon two foundations: government fran chise and private property. These are the twin sources of all monop oly.

It is not clear, however, that private property meets all the re quirements to be classed as mo nopoly by the contemporary usage of the word. Etymologically, pri vate property is a monopoly, for it is the essence of private prop erty that the owner has the exclu sive right to sell it. But in modern 1966 MELIORIST ECONOMICS 41 usage private property is not a monopoly. No man, or group of men, owns all of a commodity or service which can be sold in a particular area. No man or group of men does or can own all the means of communication, of transportation, of serving in a community unless all men are his slaves, and that could only exist by the exercise of government power. By the very nature of things, no man can own all of a particular commodity and manip ulate prices at the same time. Price is something that can only be determined after the sale of articles. Once an article has been sold, the original seller no longer has a monopoly. It is true that a man might have a monopoly of the sale of a commodity in that no one else would be permitted to sell it, but that would be a matter of law and government prescrip tion.

It follows, then, that the modern usage of monopoly only appears to differ from earlier usage. The reprehensible characteristics of monopoly - that is, the exclusive control of a commodity or service which enables one to fix or manip ulate prices - apply only to some thing that has been granted, es tablished, or prescribed by gov ernment. Anyone who doubts this should examine carefully into the sources of the ability of any seller of goods or services to fix their price. He should trace out the lines that lead from the seller to the government and find what it is that enables the seller to fix his price. The government action may be very subtle, as in the case of a protective tariff, or it may be very plain, as in the case of mini mum wages or rate regulation. But it is always there. An Assault upon Property Nonetheless, meliorist econo mists have quite often referred to what can happen when men use pri vate property to produce goods and from which to provide services as monopoly. Usually, only that seller who has garnered a substan tial portion of the market is re ferred to as a monopolist, or as being "monopolistic." To break up such "monopolies," the meliorist proposes that they be divested of some portion of their property, that the rights of property be cir cumscribed, and/or that the gov ernment regulate the use of the property. Thus, the attack upon monopoly becomes an assault upon property, though not all property immediately comes under the gun.

The amazing feature of this is that such action usually produces the substantive evil it is supposed to prevent. The evil of monopoly is the possibility it affords for fixing and mani pula ting prices so 42 THE FREEMAN May as to "charge what the traffic will bear." The regulation of "monop olies" eventuates in the fixing and manipulating of prices by govern ment. For example, in the latter part of the nineteenth century, railroads were pictured as giant monopolies gorging themselves on a defenseless public. In order to regulate them effectively, politi cians were finally convinced that they must establish rates. The government then began to fix and manipulate prices, that is, to im pose the conditions of monopoly upon both sellers and buyers. As to whether these rates were as high as the traffic would bear, the indications are that they have fre quently been more than much of railroad traffic would bear, for they have lost much of it. In recent years, railroad managers have fought an uphill battle to get at least some of their rates lowered.

Governments cannot intervene to prevent monopoly; when they intervene, they create monopoly, or the effects of it. It is the fail ure to understand, accept, or ad mit this that constitutes, in con siderable part, the .flight from reality of meliorist economists. The Face of Socialism Viewed as a school of socialism, and that is what it is, meliorism can be defined in yet another way. It is the view that the instruments of government which have been in herited in the political system can be turned to the purpose of wrest ing economic power from the hands of those who possess it (the monopolists) and placing it in the hands of the "people." Meliorism is the face that gradualist or evo lutionary socialism has worn in America, though it has usually been called liberalism in the twen tieth century. Its opposite in the socialist camp is Marxian (or revolutionary, or communist) socialism. Marx ap pears to have believed at the time of the promulgation of the Commu nist Manifesto (1848) that the regular instruments of govern ment, in the right hands, could be used to bring about socialism gradually. But after the abortive Revolutions of 1848 he turned to ward the view that the system must be destroyed first, that gov ernment was an instrument of capitalists, that they would never tolerate its use to undermine their system of exploitation (as he de scribed it).

On the other hand, meliorists have held that violent revolution is unnecessary, that the desired course of change will occur peace fully, gradually, and in an evolu tionary manner. Most have held that this process of change can be consciously directed; but they have generally insisted, too, that for it 1966 MELIORIST ECONOMICS 43 to work it must be in keeping with evolutionary trends. Meliorist economics has been concerned with how to use the instruments of government to bring the economy into line with the course of evolu tion and/or produce the desired changes. Some Leading Characters There is a huge body of litera ture that could be classified as meliorist economics. Undoubtedly, it would take a fair sized building to house the volumes that could be assembled to make a library of it. Even a list of the names of the more influential of such writers upon American thought is rather formidable in length. It would include Francis Amasa Walker, Simon N. Patten, Henry George, John R. Commons, E. R. A. Selig man, Richard T. Ely, Thorstein Veblen, John Maurice Clark, Paul H. Douglas, John Maynard Keynes, Stuart Chase, Adolph A.

Berle, Gardiner C. Means, Wesley C. Mitchell, Rexford G. Tugwell, Sumner H. Slichter, John K. Gal braith, Paul A. Samuelson, and Seymour E. Harris .. among others. These and other such writers have not always called what they were writing about monopoly. Some have, and some have not. They have called by a great variety of names the ill that is supposed to beset America : they have called it overproduction, underconsump tion, absentee ownership, techno logical unemployment, finance cap italism, oligopoly, maldistribution, economic royalism, underinvest ment, imperfect competition, in dustrial wastemaking, unearned increment, social surplus, indus trial depression, recession, the end of the frontier, a mature economy, corporate domination, and eco nomic disequilibrium. But when the tangle of rhetoric has been unwoven, when the tree of melio rism has been surveyed as a whole, when the branches have been traced back to the trunk, when the trunk has been followed to the root, it becomes clear that melio rist economics is rooted in the conception of monopoly.

The Land Monopoly This can be examined from sev eral angles. It can be shown by examining the thought of melio rist economics. The classic case of a thinker proceeding from the con cept of monopoly to a, meliorist position is that of Henry George, and he was also one of the first to have any considerable impact. George's thought proceeded along the following lines. In the first place, he believed that indus trial progress was resulting in in creasing poverty. The cause of this, he held, was that individuals were deriving profits which should 44 THE FREEMAN May accrue to society. These profits came as a result of the private ownership of land. Land, he rea soned, does not naturally belong to any of us; it was something that was here primevally, and here for all men to use. But some have acquired exclusive possession of it, by whatever means, and em ploy it to their advantage at the expense of the well-being of all.

They take away from society the return from the employment of land, and they keep lands out of use for speculative purposes, thus depriving men of the right to put the lands to economic use. (One of his underlying premises is that lands are not being economically exploited. ) He proposed that the problem could be solved by government in tervention, that the government be financed by a single tax, that the tax should take all that accrues to a man from the land itself, as opposed to that which is a prod uct of the labor of the landholder. Not only that, but the tax should fall on unused lands as well. He thought that this would result in the opening up of these lands to economic use and the amelioration of the material conditions of men generally. In short, George's diag nosis of the cause of the ill was land monopoly, his prescription was government intervention by way of the single tax, his prognosis was a general improvement in the well-being of the populace.

If we ignore the difficulty of calculating what part of a man's return can be attributed to his labor and what to his land, a diffi culty somewhat akin to the one faced by Jonathan Swift's scien tist who was attempting to ex tract sunbeams from cucumbers, and assume that the differential could be calculated, it still does not follow that economic results would be obtained. With the im position of the single tax, all ad vantage to holding title to land would disappear. Not only that, but it would be disadvantageous to hold title to unused land. It stands to reason that if the owner of unused lands could have employed them to his profit before the im position of the tax he would have done so. The tax would detract from, not add to, his incentives to use the lands productively. The chances are good that the lands would soon be offered at public auction to satisfy the tax claims against them. But that there would be buyers is most unlikely. The risks of holding title to land, even that which at the moment would be productive, would be consider able, and the advantage none. In consequence, all land might be ex pected to come eventually into the hands of the government. That governments can or will employ 1966 MELIORIST ECONOMICS 45 lands economically is something of which past experience offers no assurance. The method of melio rist economics ·is epitomized in the thought of Henry George: the lo cation of the flaw in the system, the proposal of government inter vention, the promise of ameliora tion, the assault upon property, the eventuation, if put into practice, of a giant overweening monopoly.

Veblen's Influence through the Institutionalist School Henry George showed the way. Many reformers read and were in fluenced by him. In general, though, they abandoned the spe cifics of his analysis and prescrip tion while keeping the abstract of the method. Thorstein Veblen was much more influential in specifics. In the main, his was an adaptation of the Marxian analysis into an evolutionary framework; he no longer perceived any necessity for violent revolution. He was the early leading exponent of the insti tutionalist school, which has been the most virulent branch of me liorism in America. To Veblen, economic activity takes place with in, can be understood in terms of, is a reflection of, and is driven by institutional arrangements. Insti tutions are a product of a. long, and largely unconscious, evolu tionary growth. They are under going continual change, and the task of men is to adj ust their prac tice to the course of historical de velopment. Veblen was the preco cious product of that view of re ality as consisting of change, so ciety, and psyche, a contemporary of Lester Frank Ward and John Dewey, and an applier of their shared notions to economics.

For a good many years, mainly in the first quarter of the twen tieth century, Veblen. turned all the acid contained in the English language, both received and in vented, to the task of satirizing the economic system. The system was a fit subject for satire, if Veblen' sanalysis was correct. It was shot through with anachro nisms. The major anachronism was the profit of capitalists. These got the profits of production and distribution but no longer contrib uted to it. The business of pro duction and distribution had been engrossed by corporations, almost exclusively. These, in turn, were managed by specialists who were technologists. The day had arrived when the capitalists could have been dis pensed with and the businesses run for the many rather than for the few, but capitalists continued to receive their ill-gotten gains as a result of the· outmoded institu tions which prevailed. To put it bluntly, the institutions of private property enabled capitalists to 46 THE FREEMAN May hang on to their "pecuniary gains"

which resulted from government protection of what amounted to a monopolistic position. Actually, the corporation was not private property at all; it was a public creation, which, if men were con sistent, would be used for the benefit of the public. This would happen, Veblen thought, when the technologists took over entirely and the stockholders were cut away. Veblen did not claim to know how this would come about; all that he could say for sure was that the course of economic evolu tion had just about reached the point where it would most cer tainly occur. Disciples and followers of Veb len were not slow to find means to advance the public takeover. Meliorist economics then branches out into the particular analyses of the assorted ills that are supposed to arise from an economy based upon private profit - of the· ex ploitation of workers, of sweat shops, of depression, of declining farm prices, of inevitable increases in farm tenancy, of wastefulness of natural resources, and so on and the numerous proposals for amelioration: the establishment of minimum wages, maximurn hours, stock market regulation, corporate tax, organized labor, and so forth.

In short, means are advanced for taking away from owners of property the control of it and a large portion of the profits from it. Cycles and Counter-Cycles One other such analysis may be given as an example. Wesley C. Mitchell was mainly influenced by Veblen. He turned his attention to business cycles, and wrote ex tensively about them from 1913 into the 1930's. He held that busi ness cycles, at least rnodern ones, were a phenomenon of an economy based upon profit. He analyzed the business cycle and described its various phases, starting at the depth of depression. What spurred the economy, he thought, was growth in population, depletion of products, and increasing demand, plus new investment. Investment led to profits, and the possibility of profits led to optimism and in creasing investment. Prosperity could not be maintained indefi nitely, however, because other things did not keep pace with in vestment and because technologi cal innovation produced disequi libri urn. Wages did not rise as fast as production; technology pro duced unemployment both directly and indirectly because some pro ducers would be stuck with old equipment. Profits would fall off; overproduction might result; dis tributors would have large inven tories; demand would decline; in vestment would decrease; depres1966 MELIORIST ECONOMICS 47 sion would come again. In the main, he proposed .that govern ment should intervene in such ways as manipulating the money supply so as to maintain pros perity.

While this analysis does not ap pear to hinge upon monopoly, a more careful statement of the the ory which would support it would indicate that profits are a corol lary of private property and that the basic flaw in the system is the uncoordinated management of the economy that results from the disr.~rsion of property. He pro posed (or predicted) increasing governmental planning to main tain an equilibrium. In short, he advocated the circumscription and regulation of private property so as to maintain prosperity. The Pattern of Legislation Aimed to Curb Monopoly Legislation over the years spawned by meliorist economics may demonstrate even more clearly that it was aimed at breaking up monopolies. The Interstate Com merce Act was designed to prevent the supposedly harm~ul effects of railroad monopoly of transporta tion. The various antitrust acts were attempts to circumscribe monopolistic activities. The Fed eral Reserve System was supposed to break up the Wall Street money monopoly. Minimum wages were supposed to circumvent the harm ful effects of the monopoly of em ployment activities which em ployers are supposed to have. Fed eral provision of electrical power was supposed to provide a yard stick for determining what proper competitive prices of electricity should be. Government supported loans at low interest rates are supposed to remove the harmful effects of private banking. So it has gone, from activity to activity and from industry to industry.

This supposed assault upon monopoly, though it was justified under many guises, has been, in fact, an assault upon private prop erty. It has taken away, or se verely circumscribed, the rights that belong to private ownership of property. It has brought more and more activities under the sur veillance and direction of govern ment. It has introduced the harm ful effects of monopoly into all areas of life. Government agencies now fix and manipulate prices of all sorts of things, from wages to rail rates. Theft has been legal ized, for the rights of property have been taken without compen sation, and monopoly pervades American society. ~ The next article in this series win discuss "The Bent to Destruction."