Reflections and Comments 1865 1895 by Edwin Lawrence Godkin

E >> Edwin Lawrence Godkin >> Reflections and Comments 1865 1895

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If you were then to set about explaining to Seneca that the way the
god Pan worked confusion in our day in the commercial world was by
destroying "credit," you would find yourself brought suddenly face
to face with one of the most striking differences between ancient
and modern, or, even as we have said, mediaeval society. The most
prominent and necessary accompaniment or incident of property in the
ancient world was possession. What a man owned he held. His wealth
was in his farm, or his house, or his granary, or his ships. He
could hardly separate the idea of property from that of possession,
and the state of society strengthened the association. The frugal
man hoarded, and when he was terrified he buried his money, a
practice to which we owe the preservation of the greater portion of
the old coins now in our collections. The influence of this sense of
insecurity, of the constant fear of invasion or violence, lasted
long enough in all Continental countries, as Mr. Bagehot has
recently pointed out, to prevent the establishment of banks of issue
until very lately. The prospect of war was so constantly in men's
minds that no bank could make arrangements for the run which would
surely follow the outbreak of hostilities, and, in view of this
contingency, nobody would be willing to hold paper promises to pay
in lieu of gold and silver.

It is therefore in England and America, the two countries possessing
not only most commercial enterprise, but most security against
invasion, that the paper money has come into earliest and widest
use. To the paper of the banks have been added the checks and bills
of exchange of private individuals, until money proper plays a
greatly diminishing part in the operations of commerce. Goods are
exchanged and debts paid by a system of balancing claims against
claims, which really has almost ceased to rest on money at all. So
that a man may be a very rich man in our day, and have really
nothing to show for his wealth whatever. You go to his house, and
you find nothing but a lot of shabby furniture. The only thing there
which Seneca would have called wealth is perhaps his wife's jewels,
which would not bring a few thousand dollars. You think his money
must be in the bank, but you go there with him and find that all he
has there is a page on the ledger bearing his name, with a few
figures on it. The bank bills which you see lying about, and which
look a little like money, are not only not money in the sense Seneca
understood the term, but they do not represent over a third of what
the bank owes to various people. You go to some safe-deposit vaults,
thinking that it is perhaps there he keeps his valuables, but all
you find is a mass of papers signed by Thomas Smith or John Jones,
declaring that he is entitled to so many shares of some far-off
bank, or that some railroad will pay him a certain sum some thirty
years hence. In fact, looked at with Roman eyes, our millionaire
seems to be possessed of little or nothing, and likely to be puzzled
about his daily bread.

Now, this wonderful change in the character and incidents of
property may be said to be the work of the last century, and it may
be said to consist in the substitution of an agency wholly moral for
an agency wholly material in the work of exchange and distribution.
For the giving and receiving of gold and silver we have substituted
neither more nor less than faith in the honesty and industry and
capacity of our fellow-men. There is hardly one of us who does not
literally live by faith. We lay up fortunes, marry, eat, drink,
travel, and bequeath, almost without ever handling a cent; and the
best reason which ninety-nine out of every hundred of us can give
for feeling secure against want, or having the means of enjoyment or
of charity, is not the possession of anything of real value, but his
confidence that certain thousands of his fellow-creatures, whom he
has never seen and never expects to see, scattered, it may be, over
the civilized world, will keep their promises, and do their daily
work with fidelity and efficiency. This faith is every year being
made to carry a greater and greater load. The transactions which
rest on it increase every year in magnitude and complexity. It has
to extend itself every year over a larger portion of the earth's
surface, and to include a greater variety of race and creed and
custom. London and Paris and Berlin and Vienna now tremble when New
York is alarmed. We have, in short, to believe every year in a
greater and greater number of people, and to depend for our daily
bread on the successful working of vast combinations, in which human
character is, after all, the main element.

The consequence is that, when for any reason a shade of doubt comes
over men's minds that the combination is not working, that the
machine is at some point going to give way, that somebody is not
playing his part fairly, the solid ground seems to shake under their
feet, and we have some of the phenomena resulting from an
earthquake, and among others blind terror. But to anyone who
understands what this new social force, Credit, is, and the part it
plays in human affairs, the wonder is, not that it gives way so
seldom, but that it stands so firm; that these hundreds of millions
of laborers, artisans, shopkeepers, merchants, bankers, and
manufacturers hold so firmly from day to day the countless
engagements into which they enter, and that each recurring year the
result of the prodigious effort which is now put forth in the
civilized world in the work of production should be distributed with
so much accuracy and honesty, and, on the whole, with so much wise
adjustment to the value of each man's contributions to civilization.

There is one fact, however, which throws around credit, as around so
many others of the influences by which our lives are shaped, a
frightful mystery. Its very strength helps to work ruin. The more we
believe in our fellow-toilers, and the more they do to warrant our
belief, the more we encourage them to work, the more we excite their
hopefulness; and out of this hopefulness come "panics" and
"crashes." Prosperity breeds credit, and credit stimulates
enterprise, and enterprise embarks in labors which, about every ten
years in England, and every twenty years in this country, it is
found that the world is not ready to pay for. Panics have occurred
in England in 1797, 1807, 1817, 1826, 1837, 1847, 1857, and there
was very near being a very severe one in 1866. In this country we
have had them in 1815, 1836, 1857, and 1877, and by panics we do
not mean such local whirlwinds as have desolated Wall Street, but
wide-spread commercial crises, affecting all branches of business.
This periodicity is ascribed, and with much plausibility, to the
fact that inasmuch as panics are the result of certain mental
conditions, they recur as soon as the experience of the previous one
has lost its influence, or, in other words, as often as a new
generation comes into the management of affairs, which is about
every ten years in the commercial world both in England and here.
The fact that this country seems to be only half as liable to them
as England, is perhaps due to the fact that the extent of our
resources, and the greater ratio of increase of population make it
much harder to overdo in the work of production here than in
England, and to this must be added the greater strength of nerves
produced by greater hopefulness. In spite of the enormous abundance
of British capital and the rashness of the owners in making
investments, there hangs over the London money market a timidity and
doubtfulness about the future which is unknown on this side of the
water, and which very slight accidents develop into distrust and
terror.

Outside those who are actually engaged in a financial panic--such as
brokers, bankers, merchants and manufacturers, who have loans to pay
or receive, or acceptances falling due, and who are therefore too
busy and too sorely beset to moralize on it or look at it
objectively, as the philosophers say--there is a large body
of persons who are not immediately affected by it, such as
professional men, owners of secure investments, persons in receipt
of well-assured salaries, ministers, newspaper writers, speculative
economists, financiers, and farmers, to whom it is a source of
secret enjoyment. They are obliged, out of sympathy with their
neighbors, to look blue, and probably few of them are entirely
exempt from the general anxiety about the future, but, nevertheless,
they are on the whole rather gratified than otherwise by the thing's
having happened. In the first place, all those persons who give
their attention to the currency question are divided into two great
schools--the paper men and the hard-money men; and every panic
affords each of them what it considers a legitimate ground of
triumph. The paper men say that the crisis is due to failure to
issue more paper at the proper moment, and the hard-money men
ascribe it to the irredeemability of what is already issued; and
each side chuckles over the convulsion as a startling confirmation
of its views, and goes about calling attention to it almost
gleefully. There is a similar division on the banking question.
Indeed the feud between the friends of free banking and restricted
banking is fiercer than that between the two currency schools, and
has raged longer, and every monetary crisis feeds the flame. It is
maintained, on the one hand, that if banks were let alone by the
state their issues would be proportioned to the exact wants of
business; and, on the other, that if the state would only restrict
them more rigidly business would be kept within proper limits, and
all would go well. Each disputant draws from a panic about the same
amount of support for his views, because in the great variety of
circumstances which surround it there are always some which favor
any theory of its origin. In one thing, however, both sets of
observers are apt to agree thoroughly, and that is in believing the
"thing will not blow over," and that "we are going to feel it for a
long time." They have long foreseen it, and have only been surprised
that it did not come sooner; and they lower their voices to a hoarse
whisper while telling you this.

But there is no class of observers which extracts so much solid
comfort from a panic as that large body of social philosophers who
are hostile to luxury, and believe that the world is going to the
dogs through self-indulgence. It may even be said that two-thirds of
the community, or indeed all except the very few, hold this opinion
with a greater or less degree of strength. The farmers hold it
strongly with regard to the city people, the artisans with regard to
merchants, bankers, brokers, and manufacturers, and among the latter
nearly every man is inclined to it with regard to persons of more
means than himself. Moreover, it would probably astonish us if we
knew how large was the number of those who fancy that their more
well-to-do neighbors, if they do not belong to the category of
millionaires, are living beyond their means. Every man whose own
means are small, or even moderate, finds himself rather hard put to
it to make both ends meet, and is constantly harassed by desires
which he is unable to gratify. When he sees others gratifying them,
his self-love drives him often unconsciously into ascribing it to
recklessness and improvidence. Very close people, too, who have a
constitutional repugnance to spending money freely for any purpose,
and especially for purposes of personal enjoyment, can hardly
persuade themselves that other persons who do so, spend it honestly.
And then behind these come the large army of lovers of simplicity
and frugality on moral and religious grounds, who believe that
material luxury contains a snare for the soul, and that true
happiness and real virtue are not to be found in gilded saloons.
They write to the newspapers denouncing the reluctance of young
people to marry on small incomes, and urging girls to begin life as
their mothers began it, and despise the silly chatter of those who
think luxurious surroundings more important than the union of
hearts.

The occurrence of a panic fills the breasts of all these with
various degrees of rejoicing. They always take a very dark view of
it, and laugh contemptuously at those who consider it a "Wall-Street
flurry," or ascribe it to any vice in the currency or in the banking
system. Extravagant living they believe to be at the bottom of it,
and, like the hard-money men, they are only surprised that it has
not come sooner, and they believe most firmly that it is going to
effect a sort of social revolution, and bring the world more nearly
to their own ideal of what it ought to be. The amount of
"rottenness" which they expect it to reveal is always enormous, and
they look forward to the exposure and the general coming-down of
their guilty neighbors to "the hard pan" with the keenest relish.
They have long, for instance, been unable to imagine where the
multitude of people who live in brown-stone houses get the money to
keep them. There was something wrong about it, they felt satisfied,
though they could not tell what, and when the panic comes they half
fancy that the murder will out, and that there will be a great
migration of fraudulent bankrupts from Fifth Avenue and its
neighborhood into tenement-houses on the East and North Rivers. How
Mrs. Smith, too, dressed as she did, and where Smith got the money
to take her to Sharon every summer, and how Jones managed to
entertain as he was doing, have often been puzzling problems, which
"the crash" in the money market is at last going to solve. It is
also highly gratifying to those who consider yachting a senseless
amusement to reflect that the panic will probably diminish the
number of yachts, and they even flatter themselves that it may stop
yachting in future, and reduce the general style of living among
rich young men. "We shall now," they say, "have fewer fast horses,
and less champagne, and less gaudy furniture, and more honest, hard
work, and plain, wholesome food." They accordingly rejoice in the
panic as a means adopted by Providence to bring a gluttonous and
ungodly generation to its senses, and lead it back to that state of
things which is known, as "republican simplicity."

The curious thing about this expectation is that it has survived
innumerable disappointments without apparently losing any of its
vigor. It was strong after 1837, and strong after 1857, and stronger
than ever after 1861. The war was surely, people said, to bring back
the golden age, when all the men were prudent, sober, and
industrious, and all the women simple, modest, and homekeeping. The
war did nothing of the kind. In fact, it left us more extravagant
and lavish and self-indulgent than ever; yet the ancient and tough
belief in the purifying influence of a stringent money market still
lasts, and is at this moment cropping out in the moral department of
a thousand newspapers.

The belief belongs to what may be called the cataclysmal theory of
progress, which improves the world by sudden starts, and clings so
fondly to liquor-laws, and has profound faith in specific remedies
for moral and political diseases. What commercial panics and great
national misfortunes do not do, particular bits of legislation are
sure to do. You put something in the Constitution, or forbid
something, or lose a battle, or have a "shrinkage of values," or
have a cholera season, and forthwith the community turns over a new
leaf, and becomes moral, economical, and sober-minded. We doubt
whether this theory will ever die out, however much philosophers may
preach against it, or however often facts may refute it, because it
gratifies, or promises to gratify, one of the deepest longings of
the human heart--the desire which each man feels to have a great
deal of history crowded into his own little day. None of us can bear
to quit the scene without witnessing the solution of the problems by
which his own life has been vexed or over which he has long labored.
Indeed a great many men would find it impossible to work with any
zeal to bring about results which would probably not be witnessed
until they had been centuries in the tomb.

We accordingly find that the most eager reformers are apt to be
those who look for the triumph of virtue by the close of the current
year. Of all dreams of eager reformers, however, there is probably
none more substantial than that which looks for a restoration of
that vague thing called "simplicity of manners." Simplicity and
economy are, of course, relative terms. The luxurious gentleman in
the fourteenth century lived in a way which the well-to-do artisan
in our own time would not tolerate; and when we undertake to carry
people back to ancient ways of living we find that there is hardly a
point short of barbarism at which we can consistently stop. A
country in which money is easily made and abounds, will be one in
which money will always be freely spent, and in which personal
comfort and even display will occupy men's and women's thoughts a
great deal. We can no more prevent this than we can prevent the
growth of wealth itself; and our duty is, instead of wasting our
breath in denouncing extravagance, or hailing panics as purging
fires, to do what in us lies to give rich people more taste, more
conscience, more sense of responsibility for curable ills, and a
keener relish of the higher forms of pleasure. Extravagance--or, in
other words, the waste of money on sensual enjoyment, the production
of hideous furniture or jewelry, or of barbarous display--has to be
checked not by the preaching of poor people, but by the rich man's
own superiority to these things, and his own repugnance for them.
This repugnance can only be inspired by education, whether that of
school and college, or that of a refined and cultivated social
atmosphere. Much would be done in this direction if public opinion
exacted of the owners of large fortunes that they should give their
sons the best education the country affords; or, in other words,
send them to college, instead of setting them up in the dry-goods
business or the grocery business. A man who has made a large fortune
in honest trade or industry has not contributed his share to moral
and intellectual interests by merely making donations. It is his
duty, also, if he leaves children behind him, to see to it, as far
as he can, that they are men who will be an addition to the general
culture and taste of the nation, and who will stimulate its nobler
ambition, raise its intellectual standard, quicken its love of
excellence in all fields, and deepen its faith in the value of
things not seen.

THE ODIUM PHILOLOGICUM

Our readers and those of _The Galaxy_ are familiar with the
controversy between Dr. Fitzedward Hall and Mr. Grant White
(November, 1873). When one comes to inquire what it was all about,
and why Mr. White was led to consider Dr. Hall a "yahoo of
literature," and "a man born without a sense of decency," one finds
himself engaged in an investigation of great difficulty, but of
considerable interest. The controversy between these two gentlemen
by no means brings up the problem for the first time. That verbal
criticism, such as Mr. White has been producing for some time back,
is sure to end, sooner or later, in one or more savage quarrels, is
one of the most familiar facts of the literary life of our day.
Indeed, so far as our observation has gone, the rule has no
exceptions. Whenever we see a gentleman, no matter how great his
accomplishments or sweet his temper, announcing that he is about to
write articles or deliver lectures on "Words and their Uses," or on
the "English of Every-day Life," or on "Familiar Faults of
Conversation," or "Newspaper English," or any cognate theme, we feel
all but certain that we shall soon see him engaged in an encounter
with another laborer in the same field, in which all dignity will be
laid aside, and in which, figuratively speaking, clothes, hair, and
features will suffer terribly, and out of which, unless he is very
lucky, he will issue with the gravest imputations resting on his
character in every relation of life.

Now why is it that attempts to get one's fellow-men to talk
correctly, to frame their sentences in accordance with good usage,
and take their words from the best authors, have this tendency to
arouse some of the worst passions of our nature, and predispose even
eminent philologists--men of dainty language, and soft manners, and
lofty aims--to assail each other in the rough vernacular of the
fish-market and the forecastle? A careless observer will be apt to
say that it is an ordinary result of disputation; that when men
differ or argue on any subject they are apt to get angry and indulge
in "personalities." But this is not true. Lawyers, for instance,
live by controversy, and their controversies touch interests of the
gravest and most delicate character--such as fortune and reputation;
and yet the spectacle of two lawyers abusing each other in cold
blood, in print, is almost unknown. Currency and banking are, at
certain seasons, subjects of absorbing interest, and, for the last
seventy years, the discussions over them have been numerous and
voluminous almost beyond example, and yet we remember no case in
which a bullionist called a paper-money man bad names, or in which a
friend of free banking accused a restrictionist of defrauding the
poor or defacing tombstones. Politics, too, home and foreign, is a
fertile source of difference of opinion; and yet gross abuse, on
paper, of each other, by political disputants, discussing abstract
questions having no present relation to power or pay, are very rare
indeed.

It seems, at first blush, as if an examination of the well-known
_odium theologicum_, or the traditional bitterness which has been
apt to characterize controversies about points of doctrine, from the
Middle Ages down to a period within our own memory, would throw some
light on the matter. But a little consideration will show that
there are special causes for the rancor of theologians for which
word-criticism has no parallel. The _odium theologicum_ was the
natural and inevitable result of the general belief that the holding
of certain opinions was necessary to salvation, and that the
formation of opinions could be wholly regulated by the will. This
belief, pushed to its extreme limits and embodied in legislation,
led to the burning of heretics in nearly all Christian countries.
When B's failure to adopt A's conclusions was by A regarded as a
sign of depravity of nature which, would lead to B's damnation,
nothing was more natural than that when they came into collision in
pamphlets or sermons they should have attributed to each other the
worst motives. A man who was deliberately getting himself ready for
perdition was not a person to whom anybody owed courtesy or
consideration, or whose arguments, being probably supplied by Satan,
deserved respectful examination. We accordingly find that as the
list of "essential" opinions has become shortened, and as doubts as
to men's responsibility for their opinions have made their way from
the world into the church, theological controversy has lost its
acrimony and indeed has almost ceased. No theologian of high
standing or character now permits himself to show bad temper in a
doctrinal or hermeneutical discussion, and a large and increasing
proportion of theologians acknowledge that the road to heaven is so
hard for us all that the less quarrelling and jostling there is in
it, the better for everybody.

Nor does the _odium scientificum_, of which we have now happily but
occasional manifestations, furnish us with any suggestions.
Controversy between scientific men begins to be bitter and frequent,
as the field of investigation grows wider and the investigation
itself grows deeper. But then this is easily accounted for.
All scientific men of the first rank are engaged in original
research--that is, in attempts to discover laws and phenomena
previously unknown. The workers in all departments are very
numerous, and are scattered over various countries, and as one
discovery, however slight, is very apt to help in some degree in the
making of another, scientific men are constantly exposed to having
their claims to originality contested, either as regards priority in
point of time or as regards completeness. Consequently, they may be
said to stand in delicate relations to each other, and are more than
usually sensitive about the recognition of their achievements by
their brethren--a state of things which, while it cultivates a very
nice sense of honor, leads occasionally to encounters in which
free-will seems for the moment to get the better of law. The
differences of the scientific world, too, are complicated by the
theological bearing of a good deal of scientific discovery and
discussion, and many a scientific man finds himself either compelled
to defend himself against theologians, or to aid theologians in
bringing an erring brother to reason.

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