it should never be lost sight of, that the natural laws governing the public economy of a people, like those of the human mind, are distinguished in one very essential point from those of the material world. They have to do with free rational beings, who, because they are thus free and rational, are responsible to God and their conscience, and constitute in their aggregate a species capable of progress.

SECTION XIV.

ORIGIN OF A NATION'S ECONOMY.

The public economy of a people has its origin simultaneously with the people. It is neither the invention of man nor the revelation of God. It is the natural product of the faculties and propensities which make man man.' Just as it may be shown, that the family which lives isolated from all others, contains, in itself, the germs of all political organization,2 so may it be demonstrated, that every independent household management contains the germs of all politico-economical activity. The public economy of a nation grows with the nation. With the nation, it blooms and ripens. Its season of blossoming and of maturity is the period of its greatest strength, and, at the same time, of the most perfect develop

"law," except where it is possible to predict each individual occurrence under it, there would be no such thing even as the "laws" of the probability of life. The word "element," also, means something very different in Political Economy from what it does in chemistry: a combination which might be broken up, but which that science leaves it to other sciences to do. The "element" of Political Economy is Man. Compare Pickford, Einleitung in die politische Ek., 1860, 17.

1

1 It is in this sense that Aristotle (Polit., I, p. 1, 9 Schn.) says: yavɛpòv, ὅτι τῶν φύσει ἡ πόλις ἐστὶ, καὶ ὅτι ἄνθρωπος φύσει πολιτικὸν ζῶον. According to L. Stein, Lehrbuch der Volkswirthschaft, 1858, 33, the political economy of a people begins at the point where the overplus of individuals begins.

Compare K. L. von Haller, Restauration der Staatswissenchaft, I, p.

446 ff.

ment of all its more important organs.3 In respect to it, the economic endeavors of any epoch may be said to be represented by two great parties, the one progressive, the other, conservative. The former would hasten the period of the nation's richest and most varied development, the latter postpone its departure as long as possible; and hence it comes, that a people's economic decline is sometimes taken for progress, by the former class, and their progress for decline, by the latter. As a rule, the union and equilibrium of these parties are wont to be the greatest at the period of maturity, because, then, intelligence and the spirit of sacrifice for the common good are most general.*

Finally, the public economy of a nation declines with the people. (Infra, § 263 ff.)

SECTION XV.

DISEASES OF THE SOCIAL ORGANISM.

If the public economy of a people be an organism, we must expect to find that the perturbations, which affect it, present some analogies to the diseases of the body physical. We may, therefore, hope to learn much that may be of use in

3 As Sallust characterizes the political apogee of the Romans: Optimis moribus et maxima concordia egit populus Romanus inter secundum atque postremum bellum Carthaginiense." See Augustin (Civ. Dei II, 18). Puchta (Institutionen, I, f. 83), with a great deal of good sense, distinguishes in every people their individual character from that which they share in common with all mankind. The latter exists among savage nations, only as a germ buried under the overpowering weight of that which is special to them. The period of the perfect equilibrium of both elements is coincident with that of a people's real culture. In the further course of development, the latter, more general element becomes gradually over-powerful, destroys the individual, and thus dissolves nationality.

Thus formulated, the principles of the two great parties, evidently, no more contradict one another than their ordinary watchwords, "freedom" and "order," are in contrast with one another. Hence all the great statesmen of the best periods of history have adopted the middle course recommended by Aristotle.

practice, from the tried methods of medicine.

In the diseases

of the body economic, it is necessary to distinguish accurately, between the nature of the disease and its external symptoms, although it may be necessary to combat the latter directly, and not merely with a view to alleviation. Following the example of the physician, we should particularly direct our attention to the curative method which nature itself would

pursue, were art not to intervene. "The curative power of nature is no peculiar power; it is the result of a series of happy adjustments, by means of which the morbid perturbation itself sets in motion the springs which may either destroy the evil or paralyze its action. It is, in fact, nothing but the original power which formed the body and preserves its life in contact with the external causes of perturbation and the internal disorder provoked by these causes." (Ruete.)

1 See Lotze, Allgemeine Pathologie, 1842. Ruete, Lehrbuch der allgemeinen Therapie, 1852. These analogies, obviously, should not be pushed too far. One of the most essential differences between the two consists in this, that in the diseases of the body politic, physicians and nurses are themselves part of the diseased organism.

CHAPTER II.

POSITION OF POLITICAL ECONOMY IN THE CIRCLE OF RELATED SCIENCES.

SECTION XVI.

POLITICAL OR NATIONAL ECONOMY.

By the science of national,1 or Political Economy, we understand the science which has to do with the laws of the development of the economy of a nation, or with its economic national life. (Philosophy of the history of Political Economy,

1See Ahren's very beautiful exposition, Organische Staatslehre, 1850, I, 77. National economy (Nationalökonomie = public economy); national economics (Nationalökonomik, — the science of public economy. The latter term was first proposed, in Germany, in 1849, by Uhde; the former was naturalized there in 1805: v. Soden, Nationalökonomie, 1805; Jacob, Grundsätze der N. k., 1806. In Italy, G. Ortes used it as early as 1774, in his Dell Economia nazionale, and in England it was employed, even in 1867, by Ferguson, History of Civil Society, III, p. 4. Holland. Volkshuyshoudkunde. As a rule, outside of Germany, the term political economy, économie politique, one which is somewhat calculated to mislead the student, is used. (Thus Montchr?tien sieur de Vatteville, Traité de l'Economie politique, 165; later J. J. Rousscau, Discours sur l'Economie politique, later yet the Traités d' E. p., Maillardère, Page and F. B. Say, 1801-1803). Political Economy (Sir J. Stewart, Inquiry into the principles of P. E., 1767); also Public Economy (Petty, several Essays, 1682, 35); Economia politica or pubblica (the latter by Verri and Beccaria). The title Economia civile (Genovesi, Lezioni, d' Ec. civ., 1769), has found few adherents. It has, however, been used recently by Cernuschi: Illusions des Sociétés coöperatrices (1866). The term, Economie sociale has been used all the more in France (Dunoyer, Nouveau Traité d' Ec. soc., 1830), since recommended by J. B. Say, and employed by Buat (Des vrais Principes de l' Origine et de la Filiation du Mot Economie politique, in the Journal des Economistes, 1852.)

according to von Mangoldt.) Like all the political sciences, or sciences of national life, it is concerned, on the one hand, with the consideration of the individual man, and on the other, it extends its investigations to the whole of human kind.2

3

National life, like all life, is a whole, the various phenomena of which are most intimately connected with one another. Hence it is, that to understand one side of it scientifically, it is necessary to know all its sides. But, especially, is it necessary to fix one's attention on the following seven: language, religion, art, science, law, the state and economy. Without language, all higher mental activity is unthinkable; without religion, all else would lose its firmest foundation and highest aim. Through art, alone, do all these sides attain to beauty; through science, alone, to clearness. Law arises, the moment conflicts of will become inevitable and an adjustment is desired. The state has to do with them, in so far as they have any external force or validity. Indeed, there is no human relation, not even the highest and the sweetest, but has its economic interests. It is, therefore, natural, that each of the sciences which relate to these various regions of human life should, in part, presuppose all others, and, in part, serve as a basis for them.4

2 Stein, Lehrbuck der V. W., prefaces his "Science of Public Economy" (pp. 329-358), by a "Science of Economy" (pp. 96-328), which, however, treats individual economies only as the elements of the national economy. A science of household or isolated individual economy could, of course, treat only of the economic relations of anchorites. Those who object that Political Economy is not a real whole will be satisfied with the definition of it given by F. I. Neumann: “The Science of the bearing of household or separate economies to one another, and to the state as a whole.” (Tüb.Zeitschr., 1872, 267.)

3 In so far as these various institutions are concerned, with objects beyond the human, or supernatural, only the manner in which they are accepted, or in which they are made use of, is an expression of national life.

4 Thus, F. Tucker thinks that religion, the state and commerce, are only the parts of one same general plan: no institution, therefore, can be called appropriate, within the limits of the province of any one of these, if it be clearly in opposition to the other two, because the harmony of God's work