Stephen Leacock on the Unsolved Riddle of Social Justice, Chapters III and IV

The two chapters I am going to cover today are:

III. The Failures and Fallacies of Natural Liberty; and

IV: Work and Wages.

Stephen Leacock begins his lecture on the failures and fallacies of natural liberty with the following sentence, as true in our day as in his: “The rewards and punishments of the economic world are singularly unequal.” He then contrasts them for the manual labourer, the stock market speculator, the unemployed person, the landlord, the lucky, the loafer. He then goes on:

Yet all are free. This is the distinguising mark of them as children of our era. They may work or stop. There is no compulsion from without. No man is a slave. Each has his “natural liberty,” and each in his degree, great or small, receives his allotted reward.

But is the allotment correct and the reward proportioned by his efforts? Is it fair or unfair, and does it stand for the true measure of social justice?

This is the profound problem for the twentieth century.

He then addresses, and goes on to trash, a central economic doctrine of his day, which he states as follows: Under perfectly free competition the value or selling price of everything equals, or is perpetually tending to equal, the cost of its production. In other words, “there is a ‘natural price’ of everything, and that all ‘natural prices’ are proportionate to cost and to one another; that all wages, apart from temporary fluctuations, are derived from, and limited by, the natural prices paid for the things made; that all payments for the use of capital (interest) are similarly derived and similarly limited; and that consequently the whole economic arrangements, by giving to each person exactly and precisely the fruit of his own labor, conforms exactly to social justice.”

He has earlier drawn attention to the effect on simple apparent truths of the “perfect labyrinth of complexity” that governs actual economic life. He now goes after the heart of the logic, pointing out that “the trouble with the main proposition … is that each side of the equation is used as the measure of the other. … It is a  mere argument in a circle.” In other words,—and unfortunately he does not use these words despite the title of the book,—the cost and the price of something are both an Unsolved Riddle, because each is a function of the other. Something else is going on to set their levels, and that something grows out of the “perfect labyrinth of complexity”. The idea that “every many in this just world gets what is coming to him, … gets what he is worth, and is worth what he gets” offers no explanation beyond the tautology that he gets what he gets.

He concludes the chapter with this promise:

If one knocks out the keystone of the arch in the form of a proposition that natural value conforms to the cost of production, then the whole edifice collapses and must be set up again, upon another plan and on another foundation, stone by stone.

Is it possible that the distribution of rewards in our complex world is effectively random, or would be if it were left to its own devices? Is that what a world governed by Unsolved Riddles means? If so, is that tolerable? If not, what are we going to do about it? What are we doing, and is it working? Stephen Leacock puts a great deal of stock in what works. Socialism is misguided because it doesn’t work. Laissez-faire-ism is misguided because it  doesn’t work. What does work? Or must we just muddle along, doing our best in a world we don’t really understand because, in the face of its complexity, we cannot?

In Chapter IV,—Work and Wages, he follows his thread further: “Prices, wages, salaries, interest, rent and profits do not, if left to themselves, follow the simple law of natural justice. To think so is an idle dream.”

The real truth is that prices and wages are all the various payments from hand to hand in industrial society, are the outcome of a complex of competing forces that are not based upon justice but upon “economic strength.”

The subsequent twenty pages of combined analysis and rhetoric amplify that statement and make, for me at least, tedious reading. I am running out of space today, and will leave you to look it up for yourself if you are curious. I want to get on to where he is going:

By what means and in what stages can social progress be further accelerated? This I propose to treat in the succeeding chapters, dealing first with the proposals of the socialists and the revolutionaries, and finally with the prospect for a sane, orderly and continuous social reform.

Sane, orderly, and continuous. That sounds wonderful! But suppose that we, due to the nature of the world we are given and the one we have created, in all their complexities and Unsolved Riddles, are stuck with social reform that is disorderly, discontinuous, and even sometimes apparently insane, as for example when we take great leaps of imagination and faith to do things that have never been done before? How do we act in that case? Where is Social Justice in that case? How do we think properly in that case?

This is the profound problem for the twenty-first century.

Leacock’s next two chapters deal with Socialism, the spectre that haunted his dreams, the hope that illuminated those of many in his day. We will look next week at how he dealt with it, to see whether we can learn anything we could apply to the hard-edged ideologies of our day, such as the “corporatism” and “technologism” and “fossil-fuel-ism” so prevalent in the dreams of today, and I don’t mean only those of self-interested corporatists, technologists, and fossil-fuel-ists. The ideologies whose primary approach is to oppose these, are they effective for Social Justice? What ideology would be, in a positive way?

In his last chapter he turns to “What is Possible and What Is Not”. We’ll get there two weeks from today. After that we get to work on our own.

 

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