of Western civilisation; and their roots lie deep in the native wisdom of mankind. They are obvious corollaries under the rule of Live and let live, -- an Accidental version of the Golden Rule. Yet in practical effect those vested rights which rest blamelessly on these reasonable canons of tolerance and good faith have today become the focus of vexation and misery in the life of the civilised peoples.
Circumstances have changed to such effect that provisions which were once framed to uphold a system of neighborly good-will have now begun to run counter to one another and are working mischief to the common good.
Any impartial survey of the past one-hundred-fifty years will show that the constituent principles of this modern point of view governing the mutual rights and obligations of men within the civilised nations have held their ground, on the whole, without material net gain or net loss. It is the ground of Natural
Rights, of self-help and free bargaining. Civil rights and the perquisites and obligations of ownership have remained substantially intact over this interval of a hundred and fifty years, but with some slight advance in the way of Live and let live at certain points, and some slight retrenchment at other points. So far as regards the formal stipulations, in law and custom, the balance of class interests within these countries has, on the whole, not been seriously disturbed. In this system of Natural Rights, as it has worked out in practice, the rights of ownership are paramount; largely because the other personal rights in the case have come to be a matter of course and so have ceased to hold men's attention.
So, in the matter of the franchise, e.g., the legal provisions more nearly meet the popular ideals of the modern point of view today than ever before. An the other hand the guiding principles in the case at certain other points have undergone a certain refinement of interpretation with a view to greater ease and security for trade and investment; and there has, in effect, been some slight abridgement of the freedom of combination and concerted action at any point where an unguarded exercise of such freedom would hamper trade or curtail the profits of business, -- for the modern era has turned out to be an era of business enterprise, dominated by the paramount claims of trade and investment. In point of formal requirements, these restrictions imposed on concerted action "in restraint of trade" fall in equal measure on the vested interests engaged in business and on the working population engaged in industry. So that the measures taken to safeguard the natural rights of ownership apply with equal force to those who own and those who do not. "The majestic equality of the law forbids the rich as well as the poor to sleep under bridges or to beg on the street corners." But it has turned out on trial that the vested interests of business are not seriously hampered by these restrictions; inasmuch as any formal restriction on any concerted action between the owners of such vested interests can always be got around by a formal coalition of ownership in the shape of a corporation. The extensive resort to corporate combination of ownership, which is so marked a feature of the nineteenth century, was not foreseen and was not taken into account in the eighteenth century, when the constituent principles of the modern point of view found their way into the common law. The system of Natural Rights is a system of personal rights, among which the rights of ownership are paramount; and among the rights of ownership is the right of free disposal and security of ownership and of credit obligations.
The same line of evasion is not available in the same degree for concerted action between persons who own nothing. Still, in neither case, neither as regards the owners of the country's wealth nor as regards the common man, can these restrictions on personal freedom of action be said to be a serious burden. And any slight mutilation or abridgement of the rule of self-help in their economic relations has been offset by an increasingly broad and liberal construction of the principles of self-direction and equality among men in their civil capacity and their personal relations. Indeed, the increasingly exacting temper of the common man in these countries during this period has made such an outcome unavoidable. By and large, in its formal vindication of personal liberty and equality before the law, the modern point of view has with singular consistency remained intact in the shape in which its principles were stabilised in the eighteenth century, in spite of changing circumstances. In point of formal compliance with their demands, the enlightened ideals of the eighteenth century are, no doubt, more commonly realised in practice today than at any earlier period. So that the modern civilised countries are now, in point of legal form and perhaps also in practical effect, more nearly a body of ungraded and masterless men than any earlier generation has known how to be.
In this modern era, as well as elsewhere and in other times, the circumstances that make for change and reconstruction have been chiefly the material circumstances of everyday life, -- circumstances affecting the ordinary state of industry and ordinary intercourse. These material circumstances have changed notably during the modern era. There has been a progressive change in the state of the industrial arts, which has materially altered the scope and method of industry and the conditions under which men live in all the civilised countries. Accordingly, as a point of comparison, it will be to the purpose to call to mind what were the material circumstances, and more particularly the state of the industrial arts, which underlay and gave character to the modern point of view at the period when its constituent principles were found good and worked out as a stable and articulate system, in the shape in which they have continued to be held since then.
The material conditions of industry, trade and daily life during the period of transition and approach to this modern ground created that frame of mind which we call the modern point of view and dictated that reconstruction of institutional arrangements which has been worked out under its guidance.
Therefore the economic situation which so underlay and conditioned this modern point of view at the period when it was given its stable form becomes the necessary point of departure for any argument bearing on the changes that have been going forward since then, or on any prospective reconstruction that may be due to follow from these changed conditions in the calculable future. An this head, the students of history are in a singularly fortunate position. The whole case is set forth in the works of
Adam Smith, with a comprehension and lucidity which no longer calls for praise. Beyond all other men Adam Smith is the approved and faithful spokesman of this modern point of view in all that concerns the economic situation which it assumes as its material ground; and his description of the state of civilised society, trade and industry, as he saw it in his time and as he wished it to stand over into the future, is to be taken without abatement as a competent exposition of those material conditions which were then conceived to underlie civilised society and to dictate the only sound reconstruction of civil and economic institutions according to the modern plan.
But like other men. Adam Smith was a creature of his own time, and what he has to say applies to the state of things as he saw them. What he describes and inquires into is that state of things which was to him the "historical present"; which always signifies the recent past, -- that is to say, the past as it had come under his observation and as it had shaped his outlook.
As it is conventionally dated, the Industrial Revolution took effect within Adam Smith's active lifetime, and some of its more significant beginnings passed immediately under his eyes; indeed, it is related that he took an active personal interest in at least one of the epoch-making mechanical inventions from which the era of the machine industry takes its date. Yet the
Industrial Revolution does not lie within Adam Smith's "historical present," nor does his system of economic doctrines make provision for any of its peculiar issues. What he has to say on the mechanics of industry is conceived in terms derived from an older order of things than that machine industry which was beginning to get under way in his own life-time; and all his illustrative instances and arguments on trade and industry are also such as would apply to the state of things that was passing, but they are not drawn with any view to that new order which was then coming on in the world of business enterprise.
The economic situation contemplated by Adam Smith as the natural (and ultimate) state of industry and trade in any enlightened society, conducted on sane and sound lines according to the natural order of human relations, was of a simple structure and may be drawn in few lines, -- neglecting such minor extensions and exceptions as would properly be taken account of in any exhaustive description. Industry is conceived to be of the nature of handicraft; not of the nature of mechanical engineering, such