on the one hand, and those whom he disapproves, on the other. If he is wise in his approvals and disapprovals this will probably work well. He lends his encouragement and strength to those who pass it on,-who use the strength which they receive from his friendship in doing good rather than evil. Thus the giver does more good than he would if he gave his encouragement and strength to evil men and good men alike. He should show at least that degree of preference for some men as against others. Preferring some people to others. But granting that one may be justified in showing a preference for good as compared with bad men, is one justified in showing a preference either for himself or for those who are near to him in any of the senses which we have been discussing; that is, for his family or his neighbors as compared with others outside those circles? There is something to be said in the affirmative, provided the preferences are not too extreme. Volumes have been written on this and similar problems, and doubtless many more will be written. The affirmative argument may be stated briefly in the form of a series of propositions: 1. Who ought to look after and safeguard each interest? Every interest ought to be safeguarded and provided for by the person who can do so most effectively. National or social welfare consists in the most complete satisfaction of all the interests of all the people. The more fully and completely every interest is safeguarded and provided for, the greater the prosperity and welfare of the whole group. Therefore, when each and every interest is looked after by that particular person who can look after it most thoroughly and successfully, the social welfare will be greater than it would be if some interests were looked after by persons who were not best fitted to do so. 2. Generally speaking, but with a few exceptions, each and every interest can best be safeguarded and looked after by that person who knows and understands it most intimately. Jones probably knows his own interests better than he knows those of Smith. If so, he can usually look after his own interests more effectively than he can attend to those of Smith. Likewise, and for the same reasons, Smith can look after his own interests better than he can those of Jones. Under these circumstances the interests of both Jones and Smith will be looked after better if each looks after his own than if each looked after the other's. However, there may be exceptions to this rule. Jones may know his own interests better than Smith, but may be in some unfortunate condition which renders him unable to look after them. In such a case, even though Jones does know his own interests better than Smith, Smith may nevertheless be able to look after them better than Jones can. In such a case it would promote the prosperity of that community of two if Smith would spend a part of his time looking after Jones's interests. However, as soon as Jones recovers from his incapacity it will be better for both if they return to their normal habits and each looks after his own interests. 3. Who knows each interest most completely? Generally speaking, but with a few exceptions, the individual of mature years and sound mind knows his own interests more intimately than other people know them and also more intimately than he knows the interests of other people. Young children, of course, do not know their interests as well as these are known by their elders, nor do persons of unsound mind know their interests as well as these are known by individuals of sound mind. Occasionally a mature person of sound mind may be mistaken in his judgment as to his own interests, and some exceptionally wise friends may know them better than the person himself does. In all these cases there are excellent reasons why wiser persons should take a great deal of interest in the affairs of those less wise than they, but it is well not to be too hasty in assuming that you are wise enough to look after the interests of a mature person of sound mind better than he can do it himself. 4. Generally speaking, but with a few exceptions, the individual knows the interests of his near of kin better than he knows those of his distant of kin, of his fellow citizens better than those of citizens of other countries, of members of his own race better than of members of other races. He is in much more intimate contact with the members of his immediate family than with others, and, even aside from all questions of affection, he can gauge their desires and understand their needs better than he can the desires and needs of those with whom he is not so intimately associated. That is a sufficient reason why, in the economy of nature, he should care more for them than for others. If he were driven by his affections to try to care for those whom he did not understand, while neglecting those whom he did understand, he would bungle much more than he does. Therefore nature is wise in so ordering things that affection and understanding normally go together. 5. Generally speaking, but with a few exceptions, the individual knows the interests of his near neighbors more intimately than he knows those of his distant neighbors. Here again it is a wise provision that friendship and understanding go together. 6. Whom can we reach with the least waste of energy? Generally speaking, but with a few exceptions, the individual can reach his near neighbors with less effort and waste of energy than he can reach his distant neighbors. It is wise, again, that neighborly feeling develops where there is the most power to help. If each man neglected his near neighbors and attempted to look after his distant neighbors, while their near neighbors in turn neglected them and tried to look after their distant neighbors, there would be much working at cross purposes, and much energy would be wasted because each tried to do that which he was not well situated for doing, while neglecting the work which he was well situated for doing. In conclusion, it is pretty clear that, as a general rule, a community in which each individual works effectively, looking after those interests which he can look after most successfully and with least waste of effort, is better than one in which each individual works ineffectively, trying to look after interests which he can look after less successfully and with greater waste of effort. Since each individual knows his own interests and the interests of those nearest him better than he knows the interests of those farther away, we must justify at least a moderate amount of self-preference, or self-centered appreciation of the interests of others. But it is difficult to tell just how far this rule should be carried. When communication and transportation were very difficult, the obstacles in the way of helping people who were a long way off would have made it very wasteful to try to do very much for them. Only one's near neighbors could be helped effectively, and other people outside that circle had to be left to their near neighbors, if they could not look after themselves. Now that the obstacle of distance is not so great it would seem to be economical to widen one's geographical neighborhood somewhat. Harnessing self-interest to public uses. Law and government can do little or nothing toward eliminating self-interest, even if it were desirable to do so, which it is not; but it is possible to harness it to the good of the nation. Assuming that a man will try hard to promote his own interests and the interests of those nearest to him, it is only necessary to confine his efforts to the field of usefulness or productivity. If he is never allowed to rob, steal, or do any injurious act in trying to promote his own interest, but is told that he will be permitted to do anything useful and receive pay for it or to produce some desirable product and sell it, he will then have a very strong reason for doing useful things or producing desirable objects. If a desirable object is produced, not because the producer has a benevolent interest in the consumer but because he has a selfish interest in the price which he can get for it, it will do the consumer just as much good as though it were produced for benevolent reasons. When everyone is driven by self-interest to produce as much as he can or to render as good service as he can, there will be a great deal produced and much good service rendered. Therefore, even if one did not approve of any degree of self-interest whatever, one might consistently admit that the law was making the very best of a bad situation by thus harnessing that powerful motive to useful service and productive work. Seeing that the law could not possibly transform self-interested persons into benevolent persons, the next best thing would certainly be to hedge them about so as to make it impossible for them to pursue their own self-interest in any except useful and productive lines. No visible harmony of human interests. This does not assume that there is any such thing as a natural harmony of human interests. If anything is clear it is that human interests are frequently in conflict. Unless there is an umpire or a tribunal to decide these questions of conflict, an overdeveloped self-interest will frequently drive men into actual conflict or lead one to do something in his own interest which would be injurious to others. It is one of the functions of law and government to adjudicate these conflicts and also to forbid, with suitable penalties, any injurious act. When the laws are intelligently framed and rigidly executed this leaves the individual no choice. However self-interested he may be, and however indifferent he may be to the interests of others, he must seek his self-interest by useful rather than by injurious acts. When he is thus efficiently controlled the more intense his self-interest becomes, and the more intense his interest in his family or near friends, the more intensely he will strive to do useful things, not because he wants to be useful but because he wants the reward of usefulness. To harness this powerful motive of self-interest to the kinds of work which benefit the nation-which increase wealth and prosperity—is like harnessing a great natural force like steam or electricity. In the one case the harness consists of laws and regulations; in the other it consists of mechanical devices. It has been shown above that all desires are satiable and that they are self-centered. It is necessary to understand both these facts before we can go very far in our study of economics. But what of desire itself? What does it mean to the economist and what is its economic function? Desire a symptom of dependence. A desire for a physical object is a symptom of the dependence of the organism upon |