Moreover, contrary to Barker’s assertion, demand, as an element of price, is prominent throughout this discussion of Aristotle. He objects, however, to allowing the effect of demand to overcome unduly the cost of production, thus causing inequality and injustice. According to his idea, each receives the equivalent in value of what he gives, in the sense that it is a resultant of the proportionate influence of both cost and need.[730]We may, nevertheless, observe an excellent example of inconsistency in the fact that, despite his insistence upon just exchange, he appears to treat monopoly as a legitimate principle of finance for both men and states,[731]though his intention in the passage may have been to discuss actual conditions, rather than to idealize.
Naturally, the philosopher shows no concern for a tax on imports as a means of building up the industry and commerce of his state, since he is especially desirous of limiting both. However, he is not blind to the advantages of export and import trade for a nation,[732]but would regulate them with an ethical, rather than an economic purpose.[733]His doctrine of exchange as a form of production has been discussed above,[734]and will be touched upon further in the following pages. His general criticism of what he terms “false finance” or “chrematistik” (χρηματιστική) remains for more extended treatment.
We have seen that he recognizes the necessity of a limited form of exchange, free from the purpose of gain, and considers suchtrading to be natural and in accord with that interdependence which nature demands.[735]He calls it the very bond of the social organization,[736]and even considers international commerce to be necessary for the prosperity of a state.[737]We have also seen that he goes so far as to advise the rich in a democracy to give the poor a start in business,[738]but that exchange, in its prevalent form, is to him a method of cheatery, in which one gains what the other loses.[739]
On the basis of this prejudice, he builds his argument for domestic economy (οἰκονομική) as opposed to false finance.[740]We will therefore consider his entire theory of this relation at this point, for the term “chrematistik,” though more inclusive than exchange (μεταβλητική), has trade in either goods or money (καπηλική) as its predominating element, and the two terms are often used by him as synonyms. He employs the word χρηματιστική in several significations—usually of unnatural finance, or the art of money-making by exchange of goods or money; sometimes as synonymous with κτητική, the general term for the entire business of acquisition, including both natural and unnatural finance;[741]again, of the natural finance, which is a part of domestic economy. His confusion results partly from his futile attempt to separate landed property from general industry and commerce.
His main contention is that there is a vital distinction between domestic economy, whether of householder (οἰκονόμος) or statesman, and the art of acquisition or finance, as usually pursued.The primary function of the art of finance is to provide, while that of domestic economy is to use what is provided.[742]There are, however, many methods of acquisition (κτητική; χρηματιστική), some of which truly belong to the sphere of domestic economy.[743]The provision of all that is furnished by nature herself, as necessary to human existence, then, if not already at hand (ὑπάρχειν), belongs properly to domestic economy.[744]It both uses and provides genuine wealth, such as is limited in amount (οὐκ ἄπειρος) yet sufficient for independence (αὐτάρκεια) and the good life.[745]But the use of such wealth is its chief business.[746]The other kind of acquisition, which is unlimited, or chrematistik, is contrary to nature, and is not in the province of domestic economy.[747]This unnatural finance, since it deals chiefly in the exchange of money and other commodities, may be termed retail trade (καπηλική).[748]Though itself false, it is a logical outgrowth (κατὰ λόγον) of the true form of exchange that is limited to actual needs[749]as a result of the invention of money.[750]But the real reason for its pursuit is to satisfy an evil and unlimited desire for material things.[751]It produces money merely through the exchange of money (δι1α χρημάτων μεταβολῆς),[##] and its beginning and end is unlimited currency.[752]
This false form of acquisition is often confused with necessary exchange, because both deal with money.[753]Their aims, however, are quite diverse. The latter treats the accumulation of money (αὔξησις) as a means, while the former treats it as the supreme end of life.[754]In fine, then, Aristotle teaches that necessary chrematistik has to do with the supply and use of life’s necessities, is natural (κατὰ φύσιν or οἰκειοτάτη) and limited,[755]its prime function being the proper disposal of products.[756]It is an honorable pursuit,[757]dependent chiefly upon fruits and animals,[758]and involves a practical knowledge of stock (κτηνή), farming, bee-culture, trees, fish, and fowl.[759]The false finance, on the other hand, is unnatural, dishonorable, and enriches at the expense of another.[760]Its chief business is commerce (ἐμπορία), including sea-trade (ναυκληρία), inland trade (φορτηγία), and shop-trade, (παράστασις).[761]It also comprises usury (τοκισμός) and hired labor, both skilled and unskilled (μισθαρνία ἡ μὲν τῶν βαναύσων τέχνων ἡ δὲ ἀτεχνῶν).[762]
Aristotle also distinguishes a third type of finance (χρηματιστική) which shares in the nature of both those above described. It deals with natural resources and their products, but with thingswhich, though useful, are not fruits (ἀκάρπιμα), such as wood-cutting (ὑλοτομία) and mining in all its branches (μεταλλευτική).[763]The meaning may be best apprehended if, with Ashley,[764]we observe that οἰκονομική is characterized, not only by direct acquisition of nature’s products, but also by a personal use of the same, while the unnatural finance has neither of these qualities. The medium kind, then, is like the former, in that it involves direct acquisition of natural resources, but like the latter, in that it does not acquire for directly personal use, but for exchange. It consists, therefore, not so much in the arts themselves, as in the exchange that is based on them.
In the discussion of the so-called false finance, Aristotle thus reveals a markedly hostile attitude to any extensive development of exchange. The middleman is considered to be a parasite and necessarily degenerate by the very fact of his business.[765]As seen above, his criticism was doubtless directed chiefly against the mean and dishonest spirit in the actual retail trade and money-loaning of his day.[766]Yet here also, just as in theEthicspassage above discussed, his prejudice blinds him to the fact that exchangers may be real producers, and that, after all, even the alleged false finance is not unlimited, but that it is distinctly bounded by economic demand.[767]Still worse, he includes hired labor of every kind under unlimited acquisition, merely because it has some of the other qualities of that type of economy, though it certainly does not tend to unlimited enrichment even as much as agriculture.[768]However, he should be given credit of being a forerunner of the modernhumanitarian economy, which insists that the final goal of all economics should be proper consumption, and that acquisition must be relegated to its true place as a means, the supreme end being human welfare.[769]
Aristotle exhibits an interest in the problem of population in relation to subsistence in his criticism of Plato for limiting the amount of property and making it indivisible, while failing to provide against a too high birth-rate.[770]He states the principle that, if property is to be limited, there must be a corresponding limitation on the increase of population,[771]and that the let-alone policy must be followed by increased poverty.[772]He therefore criticizes the Spartan law, for encouraging the largest possible families.[773]It is evident, however, that, as in the case of Plato, his interest in the problem is prompted chiefly by a moral and political motive. It arises merely from his desire to limit individual acquisition, in a small state, artificially constructed, and is to him in no sense a question of world food-supply.[774]
In theEthicspassage discussed above,[775]Aristotle approaches a scientific theory of distribution. He observes that just distribution will be a mean between two extremes of unfairness.[776]Unlike some moderns, however, he realizes that this will not mean equal shares for all. There must be the same ratio between the persons, or services, and the things.[777]In the “mutual exchange ofservices,” the law must be proportional requital.[778]In other words, each should receive an equivalent to what he contributes.[779]Distribution must thus proceed according to a certain standard of worth or desert (κατ᾽ ἀξίαν τινά).[780]If the individuals are unequal, their shares cannot be equal, and it is a prolific source of dispute, whenever equals receive unequal shares, or unequals receive equal.[781]On the other hand, Aristotle recognizes that it is a difficult matter to determine this standard, by which just distribution is to proceed.[782]At this point, again, he shows clearly that his paramount interest in the problem is not economic. He names four possible standards—freedom, wealth, noble birth, and general excellence—all of which are distinctly political in their reference.[783]
Though he insists on a fair distribution of wealth to the citizens, he can hardly be said to exhibit as much interest in the welfare of the common people as does Plato. He had not a very ideal conception of human nature in general. He would have thought it not only impracticable, but undesirable to give his doctrine of leisure any extensive application. As seen above, he includes all hired labor under false finance, and relegates all industry, including agriculture, to the slaves and strangers. The life of mechanic and commercial alike is to him ignoble.[784]He advises that measures be taken to hold the workers in submission and obedience.[785]His unfair criticism of Plato’sRepublic, however, on the ground that it fails to emphasize sufficiently the welfare of the parts of the state, and that it does not distinguish clearly enough the status of the commons, reveals a spirit that does not entirely disregard the masses.[786]His demand that no citizen shall lack subsistence,[787]hisprovision of thesussitiafor all,[788]his insistence that, in the market, mere economic self-interest shall not rule,[789]and his emphasis on the importance of a strong middle class in the state,[790]all show that, in the interest of the perpetuity of the state at least, he had some regard for the economic well-being of all classes. It would be wrong to infer from his suggestions for the aid of the masses in a democracy, that he would offer similar advice for the ideal state. Moreover, his chief emphasis in the passage is upon the idea of Mill, that mere hand-to-mouth help of the poor is wasteful, and that what is needed is to aid them to become economically independent.[791]Nevertheless his suggestion does show that he saw clearly the relation that exists in a democracy between the economic condition of the masses and the stability of the state.[792]He says that the genuine friend of the people (ἀληθινῶς δημοτικός) will see that the masses are not very poor, for the best assurance of the abiding welfare of the state is the solid prosperity of the great majority of the population. He therefore advises the rich to contribute money for furnishing plots of land or capital for small business enterprises to the needy poor.[793]However, while the advice seems, on the surface, to favor the commons, it is really a prudent suggestion to the upper classes, appealing to their selfish interest to avoid by this method the danger of a discontented proletariat.[794]Nevertheless, the general economic attitude of Aristotle would warrant including him, with the other Greek thinkers, in the statement of Roscher:“Die hellenische Volkswirtschaftslehre hat niemals den grossen Fehler begangen, über dem Reichtume die Menschen zu vergessen, und über der Vermehrung der Menschenzahl, der Wohlstand der einzelnen gering zu achten.”[795]
Aristotle makes clear his attitude toward the institution of private property and other related questions, both in his criticism of other thinkers, and in his own positive suggestions for the ideal state. Through his objections to the systems of Phaleas and Plato, he has acquired the reputation of being the great defender of private property in Greece. We shall see the extent to which this interpretation of him is correct. Our consideration of his theory may be summarized under certain topics which are fundamental to the problem of distribution.
He admits that the doctrine of economic equality may have some wisdom in it.[796]The attempt to equalize possessions may tend slightly to prevent civic discord.[797]Yet it is liable to arouse sedition on the part of the exploited classes,[798]and such relief measures will satisfy the masses only for a time, for they are notoriously insatiate.[799]In his opinion, therefore, the saner remedy is equalization of desires rather than of property,[800]which must be realized by proper education and a right constitution, whereby the upper classes shall not oppress, and the masses shall be held in check. We have here still a valid argument against the more radical type of socialism. It is suggestive of the modern doctrine of private property as a public trust,[801]and presents clearly the antithesis between the attitude of Greek thinkers and that of the modern social democracy.[802]
Aristotle argues further that equalization of property would be powerless to prevent anything more than the merely petty crimes, for the grossest ones are the result of inordinate desire, rather than of inability to provide life’s necessities.[803]Moreover, there are many other natural inequalities of life what would remain to arouse discontent.[804]This is a sensible observation that has often beenoverlooked by modern radical socialists, though its author might have objected further that such personal diversities would also render an abiding equality of property impossible. His previous argument, however, that immorality and crimes are the result of inordinate desire, rather than of economic need, might be answered today by the results of investigations upon the relation of wages to morality.
The doctrine of communistic equality, as preached by some theorists in fifth- and fourth-century Greece, and as satirized by Aristophanes,[805]had no appeal for Aristotle. It was, to him, merely a thinly veiled individualism. He saw through the selfish partisanship of both oligarchs and democrats, and recognized that all men are poor judges in matters that concern themselves.[806]The excessive individualism of the radical democrat of his day, which permitted the majority to confiscate the property of the minority in the name of a false equality, was as hateful to him as it was to Plato.[807]As seen above, he insisted that economic or political equality should not be demanded, except on the basis of equality of service.[808]Exploitation by the radical democracy was, in his eyes, as bad as the rule of a tyrant,[809]and the ruthless individualism of the classes was no better.[810]Like Plato, he would oppose to both of these the common interest, and would unite both masses and classes in the aim to realize the highest moral life for the individual through the state.[811]He refuted the Sophist’s theory of social contract and of justice as a mere convention.[812]As Stewart has observed he realized that “more powerful causes than the mere perceptionof material advantage brought men into social union and keep them in it.”[813]Each citizen, he held, is not his own master, but all belong to the state. Each is a member (μόριον) of the social body, and the concern of each is naturally relative to the good of the whole.[814]
Aristotle’s further criticisms, of minor significance, on the suggestions of Phaleas and Plato for equality of possessions are as follows: They have taken no precautions to regulate population accordingly.[815]They set no proper limit between luxury and penury for individual possessions.[816]Plato’s system is not thoroughgoing, since it allows inequalities in personal property, a criticism also valid against his own proposals.[817]Phaleas failed to include personal property in his system of equality.[818]Such strictures seem to proceed from his pedantic desire to criticize inconsistency. However, he may have apprehended more clearly than did Plato the danger of the press of poverty that must eventually result from a system like that of theLaws.[819]
Our author is also strong in his denial of either the wisdom or feasibility of the communism in theRepublic.[820]He argues that Plato’s proposed family communism is based upon the false principle that a state must be composed of like elements,[821]and shows that it must fail to accomplish its end of harmony, for Plato’s “all” must mean all collectively.[822]But this must result, if realized, in a decrease of devotion,[823]and thus in a lack of the very harmony sought,[824]since one of the chief sources of attachment in the world is exclusive ownership.[825]He would deem such a measure,therefore, more fitting for the third class, since a weakening of their ties of affection might result in greater submission to the rulers,[826]another striking evidence of the gulf that separates the ideal of Greek political thought from the spirit of modern democracy.
Moreover, he considers Plato’s assumption that a state, to be a unity, must be devoid of all private interests, to be gratuitous,[827]and argues that the common possession of anything is more likely to cause strife than harmony.[828]In his opinion, the present system of private property, if accompanied by a right moral tone and proper laws, combines the advantages of both common and individual ownership.[829]The tenure of property should therefore be private, but there should be a certain friendly community in its actual use.[830]Thus will be avoided the double evil of strife and neglect, which must result from dissatisfaction and lack of personal interest under communism.[831]He offers as a substitute for the Platonic doctrine, then, his own ideal of reciprocal equality (τὸ ἴσον τὸ ἀντιπεπονθός) as the real cement of society.[832]In any event, he asserts, the present evils do not result from private property, but from the depravity of human nature (μοχθηρίαν),[833]and the aim should be to improve this by moral and intellectual culture, rather than to attempt amelioration by the establishment of an entirely new system.[834]The latter method would result, even if successful, not only in escape from some of the present evils, but also in the loss of the present advantages of private tenure.[835]
The foregoing arguments all show remarkable practical insight, and have been common in the modern criticism of socialism. The objection that individual effort and industry would be paralyzed if bereft of the stimulus of personal interest and ownership, while a general fact of human nature, need not be valid against a system where each has opportunity to develop up to his capacity. Thereis certainly little to impel the great mass of people to industry under an individualistic system, except the proverbial wolf at the door. But Aristotle is not thinking of the masses. The objection that the evils result from human nature, not from the economic system, may well be pondered by modern socialists and doctrinaire reformers, yet this very fact is an additional reason why the system should be reformed so as to curb such wrong tendencies. The emphasis upon education as a cure for the existing ills is wise, and it might well be more fully recognized by modern socialists, though both Aristotle and later critics of proposed social reforms are wrong in implying that the two methods are mutually exclusive. The warning that, by giving up the régime of private properly, we should not only be rid of its evils, but also lose its advantages, should be pondered by agitators against the existing economic system. Modern socialists might also learn much from Aristotle and the other Greek thinkers in regard to the true social ideal, as not primarily materialistic and selfish, but moral and social. On the whole, it may be observed that Aristotle’s criticism of Plato’s alleged communism in theRepublicwould be far more applicable against modern socialism.
As to thesussitia, Aristotle proposes a system similar to that of Plato’sLaws.[836]He harshly criticizes the Spartan method, which required every citizen, rich and poor alike, to contribute to the common meals on pain of loss of citizenship.[837]He praises, on the other hand, the Cretan system, which permitted the entire citizenship, including women and children, to be nourished at the common table, at public expense.[838]
We have seen that Plato, in theLaws, while apparently granting private property in land, really denies this, since he makes the product of the land practically public property.[839]Aristotle, despite his strictures against communism, advocates a system of land tenure quite similar. His limitation of the freedom of donation or testament, purchase or sale; his demands that the lot shallnever leave the family, that it shall always be handed down by legitimate succession, and that no citizen shall ever be allowed to hold more than one allotment, are all Platonic, and make him unquestionably an advocate of family, rather than of private ownership of land.[840]His collectivism is more direct than that of theLaws, since he makes part of the land entirely public, to defray the expense of worship and the common meals.[841]The assignment of lots to the citizens is on the same terms as in theLaws, with the exception that the owners are masters of the product of their lots.[842]Despite his criticism of Plato’s division of homesteads, he has the same plan.[843]As in theLaws, only citizens are landowners, and this includes only the governing and military classes,[844]while all husbandmen are to be public or private slaves.[845]Unlike Plato, however, Aristotle does not attempt to avoid undue inequalities in personal property.[846]He sets no maximum above which limit goods must be confiscated, nor does he, as Plato, establish a rigorous system of laws to hamper trade and to make money-making operations practically impossible. He recognizes that such regulations are not feasible, and his legislation is therefore more considerate of human nature, despite the fact that his hostility to the ideal of commercialism is even more pronounced than is that of Plato.[847]
It is evident from the preceding outline of Aristotle’s negative and positive doctrine on the matter of private property that his system is in substantial agreement with that of Plato’s second state.[848]Besides the points of similarity noted above, he agrees with his predecessor in emphasizing strongly the power of the state over the life of the citizens. Both insist that the citizen belongs, notto himself, but to the state, and can realize his best life only through the state.[849]Thus Aristotle is far from being a defender of private property in the absolute sense. On the other hand, his emphasis upon the social obligation of individual possession is, if not socialistic, at least very modern. He is certainly a much better socialist than the alleged communist of theRepublic, whom he criticizes so severely. Like the Plato of theLaws, he is a semi-collectivist. As Barker has observed,[850]Aristotle thought in terms of land, while modern socialism thinks in terms of capital and labor. Both standpoints involve social ownership and the limitation of the individual, and in this respect the Greek thinker was socialistic in tendency. But despite their social spirit and their trend toward nationalism, which is so strong in all progressive countries today, neither he nor Plato was a socialist, in the modern sense, in spirit or in aim.[851]Any attempts at direct comparison with modern socialism, therefore, are likely to be fanciful and confusing. Whatever analogy there is between them is of a very general nature and should not be pressed.[852]