THE ENGINEERS AND THE PRICE SYSTEM E-Book

Thorstein Veblen

• Herausgeber: e-artnow
• Kategorie: Fachliteratur
• Sprache: Englisch
• Veröffentlichungsjahr: 2016

Seitenzahl: 175

Beschreibung

This carefully crafted ebook: "THE ENGINEERS AND THE PRICE SYSTEM" is formatted for your eReader with a functional and detailed table of contents. THE ENGINEERS AND THE PRICE SYSTEM is a compilation of a series of papers, each of which mainly analyzes and criticizes the price system, planned obsolescence, and artificial scarcity. His position is that engineers, not workers, should overthrow capitalism. Veblen wrote this book during his occupation in The New School's development and in it, he proposed a soviet of engineers. Thorstein Veblen (1857-1929) was an American economist and sociologist. He is well known as a witty critic of capitalism. Veblen is famous for the idea of "conspicuous consumption." Conspicuous consumption, along with "conspicuous leisure," is performed to demonstrate wealth or mark social status. Veblen explains the concept in his best-known book, The Theory of the Leisure Class. Within the history of economic thought, Veblen is considered the leader of the institutional economics movement. Veblen's distinction between "institutions" and "technology" is still called the Veblenian dichotomy by contemporary economists.

Leseprobe

Thorstein Veblen

THE ENGINEERS AND THE PRICE SYSTEM

From the Author of The Theory of the Leisure Class, The Theory of Business Enterprise, Imperial Germany and the Industrial Revolution, The Higher Learning in America and many more

e-artnow, 2015 Contact: [email protected]

ISBN 978-80-268-5013-7

Table of Contents

I. On the Nature and Uses of Sabotage

II. The Industrial System and the Captains of Industry

III. The Captains of Finance and the Engineers

IV. On the Danger of a Revolutionary Overturn

V. On the Circumstances Which Make for a Change

VI. A Memorandum on a Practicable Soviet of Technicians

I. On the Nature and Uses of Sabotage

Table of Contents

"Sabotage" is a derivative of "sabot," which is French for a wooden shoe. It means going slow, with a dragging, clumsy movement, such as that manner of footgear may be expected to bring on. So it has come to describe any manoeuvre of slowingdown, inefficiency, bungling, obstruction. In American usage the word is very often taken to mean forcible obstruction, destructive tactics, industrial frightfulness, incendiarism and high explosives, although that is plainly not its first meaning nor its common meaning. Nor is that its ordinary meaning as the word is used among those who have advocated a recourse to sabotage as a means of enforcing an argument about wages or the conditions of work. The ordinary meaning of the word is better defined by an expression which has latterly come into use among the I. W. W., "conscientious withdrawal of efficiency" - although that phrase does not cover all that is rightly to be included under this technical term.

The sinister meaning which is often attached to the word in American usage, as denoting vio-lence and disorder, appears to be due to the fact that the American usage has been shaped chiefly by persons and newspapers who have aimed to discredit the use of sabotage by organized workmen, and who have therefore laid stress on its less amiable manifestations. This is unfortunate. It lessens the usefulness of the word by making it a means of denunciation rather than of understanding. No doubt, violent obstruction has had its share in the strategy of sabotage as carried on by disaffected workmen, as well as in the similar tactics of rival business concerns. It comes into the case as one method of sabotage, though by no means the most usual or the most effective; but it is so spectacular and shocking a method that it has drawn undue attention to itself.

Yet such deliberate violence is, no doubt, a relatively minor fact in the case, as compared with that deliberate malingering, confusion, and misdirection of work that makes up the bulk of what the expert practitioners would recognize as legitimate sabotage.

The word first came into use among the organized French workmen, the members of certain syndicats, to describe their tactics of passive resistance, and it has continued to be associated with the strategy of these French workmen, who are known as syndicalists, and with their likeminded runningmates in other countries. But the tactics of these syndicalists, and their use of sabotage, do not differ, except in detail, from the tactics of other workmen elsewhere, or from the similar tactics of friction, obstruction, and delay habitually employed, from time to time, by both employées and employers to enforce an argument about wages and prices. Therefore, in the course of a quartercentury past, the word has quite unavoidably taken on a general meaning in common speech, and has been extended to cover all such peaceable or surreptitious manoeuvres of delay, obstruction, friction, and defeat, whether employed by the workmen to enforce their claims, or by the employers to defeat their employées, or by competitive business concerns to get the better of their business rivals or to secure their own advantage.

Such manoeuvres of restriction, delay, and hindrance have a large share in the ordinary conduct of business; but it is only lately that this ordinary line of business strategy has come to be recognized as being substantially of the same nature as the ordinary tactics of the syndicalists. So that it has not been usual until the last few years to speak of manoeuvres of this kind as sabotage when they are employed by employers and their business concerns. But all this strategy of delay, restriction, hindrance, and defeat is manifestly of the same character, and should conveniently be called by the same name, whether it is carried on by business men or by workmen; so that it is no longer unusual now to find workmen speaking of "capitalistic sabotage" as freely as the employers and the newspapers speak of syndicalist sabotage. As the word is now used, and as it is properly used, it describes a certain system of industrial strategy or management, whether it is employed by one or another. What it describes is a resort to peaceable or surreptitious restriction, delay, withdrawal, or obstruction.

Sabotage commonly works within the law, although it may often be within the letter rather than the spirit of the law. It is used to secure some special advantage or preference, usually of a businesslike sort. It commonly has to do with something in the nature of a vested right, which one or another of the parties in the case aims to secure or defend, or to defeat or diminish; some preferential right or special advantage in respect of income or privilege, something in the way of a vested interest. Workmen have resorted to such measures to secure improved conditions of work, or increased wages, or shorter hours, or to maintain their habitual standards, to all of which they have claimed to have some sort of a vested right. Any strike is of the nature of sabotage, of course. Indeed, a strike is a typical species of sabotage. That strikes have not been spoken of as sabotage is due to the accidental fact that strikes were in use before this word came into use. So also, of course, a lockout is another typical species of sabotage. That the lockout is employed by the employers against the employées does not change the fact that it is a means of defending a vested right by delay, withdrawal, defeat, and obstruction of the work to be done. Lockouts have not usually been spoken of as sabotage, for the same reason that holds true in the case of strikes. All the while it has been recognized that strikes and lockouts are of identically the same character.

All this does not imply that there is anything discreditable or immoral about this habitual use of strikes and lockouts. They are part of the ordinary conduct of industry under the existing system, and necessarily so. So long as the system remains unchanged these measures are a necessary and legitimate part of it. By virtue of his ownership the owneremployer has a vested right to do as he will with his own property, to deal or not to deal with any person that offers, to withhold or withdraw any part or all of his industrial equipment and natural resources from active use for the time being, to run on half time or to shut down his plant and to lock out all those persons for whom he has no present use on his own premises. There is no question that the lockout is altogether a legitimate manoeuvre. It may even be meritorious, and it is frequently considered to be meritorious when its use helps to maintain sound conditions in business - that is to say profitable conditions - as frequently happens. Such is the view of the substantial citizens. So also is the strike legitimate, so long as it keeps within the law; and it may at times even be meritorious, at least in the eyes of the strikers. It is to be admitted quite broadly that both of these typical species of sabotage are altogether fair and honest in principle, although it does not therefore follow that every strike or every lockout is necessarily fair and honest in its workingout. That is in some degree a question of special circumstances.

Sabotage, accordingly, is not to be condemned out of hand, simply as such. There are many measures of policy and management both in private business and in public administration which are unmistakably of the nature of sabotage and which are not only considered to be excusable, but are deliberately sanctioned by statute and common law and by the public conscience. Many such measures are quite of the essence of the case under the established system of law and order, price and business, and are faithfully believed to be indispensable to the common good. It should not be difficult to show that the common welfare in any community which is organized on the price system cannot be maintained without a salutary use of sabotage - that it to say, such habitual recourse to delay and obstruction of industry and such restriction of output as will maintain prices at a reasonably profitable level and so guard against business depression.

Indeed, it is precisely considerations of this nature that are now engaging the best attention of officials and business men in their endeavors to tide over a threatening depression in American business and a consequent season of hardship for all those persons whose main dependence is free income from investments.

Without some salutary restraint in the way of sabotage on the productive use of the available industrial plant and workmen, it is altogether unlikely that prices could be maintained at a reasonably profitable figure for any appreciable time. A businesslike control of the rate and volume of output is indispensable for keeping up a profitable market, and a profitable market is the first and unremitting condition of prosperity in any community whose industry is owned and managed by business men. And the ways and means of this necessary control of the output of industry are always and necessarily something in the nature of sabotage - something in the way of retardation, restriction, withdrawal, unemployment of plant and workmen - whereby production is kept short of productive capacity.

The mechanical industry of the new order is inordinately productive. So the rate and volume of output have to be regulated with a view to what the traffic will bear - that is to say, what will yield the largest net return in terms of price to the business men who manage the country's industrial system. Otherwise there will be "overproduction," business depression, and consequent hard times all around. Overproduction means production in excess of what the market will carry off at a sufficiently profitable price. So it appears that the continued prosperity of the country from day to day hangs on a "conscientious withdrawal of efficiency" by the business men who control the country's industrial output. They control it all for their own use, of course, and their own use means always a profitable price.

In any community that is organized on the price system, with investment and business enterprise, habitual unemployment of the available industrial plant and workmen, in whole or in part, appears to be the indispensable condition without which tolerable conditions of life cannot be maintained. That is to say, in no such community can the industrial system be allowed to work at full capacity for any appreciable interval of time, on pain of business stagnation and consequent privation for all classes and conditions of men. The requirements of profitable business will not tolerate it. So the rate and volume of output must be adjusted to the needs of the market, not to the working capacity of the available resources, equipment and man power, nor to the community's need of consumable goods. Therefore there must always be a certain variable margin of unemployment of plant and manpower. Rate and volume of output can, of course, not be adjusted by exceeding the productive capacity of the industrial system. So it has to be regulated by keep-ing short of maximum production by more or less as the condition of the market may require. It is always a question of more or less unemployment of plant and man power, and a shrewd moderation in the unemployment of these available resources, a "conscientious withdrawal of efficiency," therefore, is the beginning of wisdom in all sound workday business enterprise that has to do with industry.

All this is matter of course, and notorious. But it is not a topic on which one prefers to dwell. Writers and speakers who dilate on the meritorious exploits of the nation's business men will not commonly allude to this voluminous running administration of sabotage, this conscientious withdrawal of efficiency, that goes into their ordinary day's work. One prefers to dwell on those exceptional, sporadic, and spectacular episodes in business where business men have now and again successfully gone out of the safe and sane highway of conservative business enterprise that is hedged about with a conscientious withdrawal of efficiency, and have endeavored to regulate the output by increasing the productive capacity of the industrial system at one point or another.

But after all, such habitual recourse to peaceable or surreptitious measures of restraint, delay, and obstruction in the ordinary businesslike management of industry is too widely known and too well approved to call for much exposition or illustration. Yet, as one capital illustration of the scope and force of such businesslike withdrawal of efficiency, it may be in place to recall that all the civilized nations are just now undergoing an experiment in businesslike sabotage on an unexampled scale and carried out with unexampled effrontery. All these nations that have come through the war, whether as belligerents or as neutrals, have come into a state of more or less pronounced distress, due to a scarcity of the common necessaries of life; and this distress falls, of course, chiefly on the common sort, who have at the same time borne the chief burden of the war which has brought them to this state of distress.

The common man has won the war and lost his livelihood. This need not be said by way of praise or blame. As it stands it is, broadly, an objective statement of fact, which may need some slight qualification, such as broad statements of fact will commonly need. All these nations that have come through the war, and more particularly the common run of their populations, are very much in need of all sorts of supplies for daily use, both for immediate consumption and for produc- tive use. So much so that the prevailing state of distress rises in many places to an altogether unwholesome pitch of privation, for want of the necessary food, clothing, shelter, and fuel. Yet in all these countries the staple industries are slowing down. There is an ever increasing withdrawal of efficiency. The industrial plant is increasingly running idle or half idle, running increasingly short of its productive capacity. Workmen are being laid off and an increasing number of those workmen who have been serving in the armies are going idle for want of work, at the same time that the troops which are no longer needed in the service are being demobilized as slowly as popular sentiment will tolerate, apparently for fear that the number of unemployed workmen in the country may presently increase to such proportions as to bring on a catastrophe. And all the while all these peoples are in great need of all sorts of goods and services which these idle plants and idle workmen are fit to produce. But for reasons of business expediency it is impossible to let these idle plants and idle workmen go to work - that is to say for reasons of insufficient profit to the business men interested, or in other words, for the reasons of insufficient income to the vested interests which control the staple industries and so regulate the output of product. The traffic will not bear so large a production of goods as the community needs for current consumption, because it is considered doubtful whether so large a supply could be sold at prices that would yield a reasonable profit on the investment - or rather on the capitalization; that is to say, it is considered doubtful whether an increased production, such as to employ more workmen and supply the goods needed by the community, would result in an increased net aggregate income for the vested interests which control these industries. A reasonable profit always means, in effect, the largest obtainable profit.

All this is simple and obvious, and it should scarcely need explicit statement.

It is for these business men to manage the country's industry, of course, and therefore to regulate the rate and volume of output; and also of course any regulation of the output by them will be made with a view to the needs of business; that is to say, with a view to the largest obtainable net profit, not with a view to the physical needs of these peoples who have come through the war and have made the world safe for the business of the vested interests. Should the business men in charge, by any chance aberration, stray from this straight and narrow path of business integrity, and allow the community's needs unduly to influence their management of the community's industry, they would presently find themselves discredited and would probably face insolvency. Their only salvation is a conscientious withdrawal of efficiency. All this lies in the nature of the case. It is the working of the price system, whose creatures and agents these business men are. Their case is rather pathetic, as indeed they admit quite volubly. They are not in a position to manage with a free hand, the reason being that they have in the past, under the routine requirements of the price system as it takes effect in corporation finance, taken on so large an overhead burden of fixed charges that any appreciable decrease in the net earnings of the business will bring any wellmanaged concern of this class face to face with bankruptcy.

At the present conjuncture, brought on by the war and its termination, the case stands somewhat in this typical shape. In the recent past earnings have been large; these large earnings (free income) have been capitalized; their capitalized value has been added to the corporate capital and covered with securities bearing a fixed incomecharge; this incomecharge, representing free income, has thereby become a liability on the earnings of the corporation; this liability cannot be met in case the concern's net aggregate earnings fall off in any degree; therefore prices must be kept up to such a figure as will bring the largest net aggregate return, and the only means of keeping up prices is a conscientious withdrawal of efficiency in these staple industries on which the community depends for a supply of the necessaries of life.

The business community has hopes of tiding things over by this means, but it is still a point in doubt whether the present unexampled large use of sabotage in the businesslike management of the staple industries will now suffice to bring the business community through this grave crisis without a disastrous shrinkage of its capitalization, and a consequent liquidation; but the point is not in doubt that the physical salvation of these peoples who have come through the war must in any case wait on the pecuniary salvation of these owners of corporate securities which represent free income. It is a sufficiently difficult passage.

It appears that production must be curtailed in the staple industries, on pain of unprofitable prices. The case is not so desperate in those industries which have immediately to do with the production of superfluities; but even these, which depend chiefly on the custom of those kept classes to whom the free income goes, are not feeling altogether secure. For the good of business it is necessary to curtail production of the means of life, on pain of unprofitable prices, at the same time that the increasing need of all sorts of the necessaries of life must be met in some passable fashion, on pain of such popular disturbances as will always come of popular distress when it passes the limit of tolerance.