Great Throughts Treasury

"Our society is an immense stamping ground for the careless production of underdeveloped and malformed human beings... [not] concerned with moral issues, with serious problems, or with human dignity."

"The civilization malaise, in a word, reflects the inability of a civilization directed to material improvement - higher incomes, better diets, miracles of medicine, triumphs of applied physics and chemistry - to satisfy the human spirit."

"The distribution of wealth, therefore, depends on the laws and customs of society."

"The cure for capitalism's failing would require that a government would have to rise above the interests of one class alone."

"Mathematics has given economics rigor, but alas, also mortis."

"If one could divine the nature of the economic forces in the world, one could foretell the future."

"Adam Smith was not the proponent of any one class. He was a slave to his system. His whole economic philosophy stemmed from his unquestioning faith in the ability of the market to guide the system to its point of highest return. The market?that wonderful social machine?would take care of society?s needs if it was left alone. Don?t try to do good, says Smith. Let good emerge as the by-product of selfishness."

"But like Marx, Veblen badly underestimated the capacity of a democratic system to correct its own excesses."

"But the process of social change was not merely a matter of new inventions pressing on old institutions: it was a matter of new classes displacing old ones."

"But despite the clarion words of the Manifesto, the demonic note was not a call for a revolution of communism; it was a cry born only of frustration and despair."

"But while Ricardo, the economist, walked like a god (although he was a modest and retiring person), Malthus was relegated to a lower status."

"Capitalism is the only society in human history in which neither tradition nor conscious direction supervises the total effort of the community; it is the only society in which the future, the needs for tomorrow, are entirely left to an automatic system."

"Communists talked to the masses and urged violence, if necessary, to encompass their ends; the Socialists appealed to their own kind?to the intelligentsia, the petit bourgeois, the freethinking middle-class citizen, or the intellectually emancipated aristocrat?for adherents to their schemes."

"For one who has read the works of Marx it is frightening to look back at the grim determination with which so many nations steadfastly hewed to the very course which he insisted would lead to their undoing."

"He who enlists a man's mind wields a power even greater than the sword or the scepter."

"History, as it comes into our daily lives, is charged with surprise and shock."

"If an economy in the doldrums could drift indefinitely, the price of government inaction might be graver by far than the consequences of bold unorthodoxy."

"David Ricardo saw that the escalator worked with different effects on different classes, that some rode triumphantly to the top, while others were carried up a few steps and then kicked back down to the bottom."

"Economic freedom is a highly desirable state - but in bust and boom we must be prepared to face the its consequences."

"Few socialists outside the Communist Party are willing to acknowledge that real socialism means trading our "Millian liberties" for the purported good of economic planning and "a morally conscious collectivity."

"For it is certain that the future will bring realities for which our traditional optimism fails to prepare us and against which our economic momentum fails to arm us."

"Even today-in blithe disregard to his actual philosophy ? Smith is generally regarded as a conservative economist, whereas in fact, he is more avowedly hostile to the motives of businessman then most New Deal economists."

"In the end the question is: Who is to be master, man or his machines? As long as the control over technology rests primarily on economic calculation, the victor is not likely to be man."

"In the late 1980s, absolute economic disaster arrived in the Soviet Union and its Eastern former satellites, and those countries are still trying to construct some form of economic structure that will no longer display the deadly inertia and indifference that have come to be the hallmarks of socialism. It is too early to predict whether these efforts will succeed. The main obstacle to real perestroika is the impossibility of creating a working market system without a firm basis of private ownership, and it is clear that the creation of such a basis encounters the opposition of the former state bureaucracy and the hostility of ordinary people who have long been trained to be suspicious of the pursuit of wealth. In the face of such uncertainties, all predictions are foolhardy save one: no quick or easy transition from socialism to some form of nonsocialism is possible. Transformations of such magnitude are historic convulsions, not mere changes in policy. Their completion must be measured in decades or generations, not years."

"In the periods of crisis, the bigger firms absorb the smaller ones,and when the industrial monsters eventually go down, the wreckage is far greater than when the little enterprises buckle."

"It is from the scope and wisdom of the economists of the past that we must reap the knowledge with which to face the future."

"It is not surprising that this increasingly Byzantine system began to create serious dysfunctions beneath the overall statistics of growth. During the 1960s the Soviet Union became the first industrial country in history to suffer a prolonged peacetime fall in average life expectancy, a symptom of its disastrous misallocation of resources. Military research facilities could get whatever they needed, but hospitals were low on the priority list. By the 1970s the figures clearly indicated a slowing of overall production. By the 1980s the Soviet Union officially acknowledged a near end to growth that was, in reality, an unofficial decline. In 1987 the first official law embodying perestroika?restructuring?was put into effect. President Mikhail Gorbachev announced his intention to revamp the economy from top to bottom by introducing the market, reestablishing private ownership, and opening the system to free economic interchange with the West. Seventy years of socialist rise had come to an end."

"It is often thought that the idea of socialism derives from the work of Karl Marx. In fact, Marx wrote only a few pages about socialism, as either a moral or a practical blueprint for society. The true architect of a socialist order was Lenin, who first faced the practical difficulties of organizing an economic system without the driving incentives of profit seeking or the self-generating constraints of competition. Lenin began from the long-standing delusion that economic organization would become less complex once the profit drive and the market mechanism had been dispensed with??as self-evident,? he wrote, as ?the extraordinarily simple operations of watching, recording, and issuing receipts, within the reach of anybody who can read and write and knows the first four rules of arithmetic.?"

"Karl Marx did not call for an opposition to the forces of history. On the contrary he accepted all of them, the drive of technology, the revolutionizing effects of democratic striving, even the vagaries of capitalism, as being indeed the carriers of a brighter future."

"Keynes disdained inside information ? in fact, he once declared that Wall Street traders could make huge fortunes if only they would disregard their "inside" information ? and his own oracles were nothing but his minute scrutiny of balance sheets, his encyclopedic knowledge of finance, his intuition into personalities, and a certain flair for trading."

"Marx did not call for an opposition to the forces of history. On the contrary he accepted all of them, the drive of technology, the revolutionizing effects of democratic striving, even the vagaries of capitalism, as being indeed the carriers of a brighter future."

"Nobody wanted this commercialization of life."

"One accumulates or one gets accumulated."

"Ricardo saw that the escalator worked with different effects on different classes, that some rode triumphantly to the top, while others were carried up a few steps and then kicked back down to the bottom."

"In the schism of realms, it is enough to establish the primacy of capital, not its dictatorship."

"It was the unemployment that was the hardest to bear. The jobless millions were like an embolism in the nation's vital circulation; and while their indisputable existence argued more forcibly than any text that something was wrong with the system, the economists wrung their hands and racked their brains and called upon the spirit of Adam Smith, but could offer neither diagnosis or remedy."

"It is one of the dangerous self-deceptions of our society to pretend that mechanisms of control do not really exist, and to maintain, without qualification, that we are an economically "free" people."

"It may strike us as odd that the idea of gain is a relatively modern one; we are schooled to believe that man is essentially an acquisitive creature and that left to himself he will behave as any self-respecting businessman would. The profit motive, we are constantly being told, is as old as man himself. Nothing could be further from the truth."

"Socialism?defined as a centrally planned economy in which the government controls all means of production?was the tragic failure of the twentieth century. Born of a commitment to remedy the economic and moral defects of capitalism, it has far surpassed capitalism in both economic malfunction and moral cruelty. Yet the idea and the ideal of socialism linger on. Whether socialism in some form will eventually return as a major organizing force in human affairs is unknown, but no one can accurately appraise its prospects who has not taken into account the dramatic story of its rise and fall."

"The book [Keynes? The General Theory of Employment, Interest, and Money] was revolutionary: no other word will quite do. It stood economics on its head for the book had a startling and dismaying conclusion. There was no automatic safety mechanism after all! Rather than a see-saw which would always right itself, the economy resembled an elevator: it could be going up or down, but it could also be standing perfectly still. And it was just as capable of standing still on the ground floor as at the top of the shaft. A depression, in other words, might not cure itself at all; the economy could lie prostrate indefinitely, like a ship becalmed."

"The change began with John Stuart Mill and the Utopians. When Mill pointed out that economics had no ultimate solution to the problem of distribution, that society might do with the fruits of its toil as it saw fit, he introduced into the mechanical calculus of the market a conflicting calculus of moral judgment."

"The great economists can be called the worldly philosophers, for they sought to embrace in a scheme of philosophy the most worldly of all of man's activities?his drive for wealth."

"The rise of the welfare state, on the one hand, and of the military bureaucracy, on the other, are instances of the manner in which technology is enforcing a socialization of life."

"The secret to economic growth lay in the fact that that each generation attacked Nature not only with its own energies and resources, but with the heritage of equipment accumulated by its forebears."

"The basic function of the military - to achieve victory over the enemy - has been rendered obsolete by the fact that victory and defeat are almost certain to be achieved simultaneously."

"Socialism... must depend for its economic direction on some form of planning, and for its culture on some form of commitment to the idea of a morally conscious collectivity... If tradition cannot, and the market system should not, underpin the socialist order, we are left with some form of command as the necessary means for securing its continuance and adaptation. Indeed, that is what planning means... The factories and stores and farms and shops of a socialist socioeconomic formation must be coordinated... and this coordination must entail obedience to a central plan... The rights of individuals to their Millian liberties [are] directly opposed to the basic social commitment to a deliberately embraced collective moral goal... Under socialism, every dissenting voice raises a threat similar to that raised under a democracy by those who preach anti-democracy."

"The book was called Imperialism; it was a devastating volume. For here was the most important and searing criticism which had ever been levied against the profit system. The worst that Marx had claimed was that the system would destroy itself; what Hobson suggested was that it might destroy the world."

"The system that evolved under Stalin and his successors took the form of a pyramid of command. At its apex was Gosplan, the highest state planning agency, which established such general directives for the economy as the target rate of growth and the allocation of effort between military and civilian outputs, between heavy and light industry, and among various regions. Gosplan transmitted the general directives to successive ministries of industrial and regional planning, whose technical advisers broke down the overall national plan into directives assigned to particular factories, industrial power centers, collective farms, and so on. These thousands of individual subplans were finally scrutinized by the factory managers and engineers who would eventually have to implement them. Thereafter, the blueprint for production reascended the pyramid, together with the suggestions, emendations, and pleas of those who had seen it. Ultimately, a completed plan would be reached by negotiation, voted on by the Supreme Soviet, and passed into law. Thus, the final plan resembled an immense order book, specifying the nuts and bolts, steel girders, grain outputs, tractors, cotton, cardboard, and coal that, in their entirety, constituted the national output. In theory such an order book should enable planners to reconstitute a working economy each year?provided, of course, that the nuts fitted the bolts; the girders were of the right dimensions; the grain output was properly stored; the tractors were operable; and the cotton, cardboard, and coal were of the kinds needed for their manifold uses. But there was a vast and widening gap between theory and practice."

"The total amount of electric power generated by India would not suffice to light up New York City."

"The Wealth of Nations may not be an original book, but it is unquestionably a masterpiece."