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Rudolf Steiner e.Lib
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Basic Issues of the Social Question
Rudolf Steiner e.Lib Document
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Basic Issues of the Social Question
Basic Issues: Chapter Three: Capitalism and Social Ideas
On-line since: 13th July, 2002
Capitalism and Social Ideas
(Capital, Human Labour)
It is not possible to judge what kind of action is demanded by the
resounding events of the times without the will to be guided in this
judgement by an insight into the basic forces of the social organism.
The preceding presentation is an attempt to arrive at such an insight.
Measures based on a judgement which derives from a narrowly
circumscribed field of observation cannot have positive results today.
The facts which have grown out of the social movement reveal
disturbances in the foundations of the social organism and by
no means superficial ones. Therefore, it is necessary to arrive at
insights which penetrate to these foundations.
When capital and capitalism are spoken of today, they refer to what
proletarian humanity considers to be the causes of its oppression. It
is only possible to form a worthwhile judgement concerning the way in
which capital furthers or hinders the social organism's circulatory
processes by perceiving how individual human capabilities, rights
legislation and the forces of economic life produce and consume
capital. When human labour is spoken of it refers to the function
that, together with the natural base of the economy and capital,
creates the economic values through which the worker becomes conscious
of his social condition. A judgement as to how this human labour must
be introduced into the social organism in a manner which does not
disturb the worker's sense of human dignity will only result from
observing the relation which human labour has to the development of
individual capabilities on the one hand and to rights-awareness on the
other.
People are asking today and rightly so what is the first
step to be taken in order to satisfy the demands which are arising in
the social movement. Even the first step will not be taken in a
worthwhile manner if it is not known what relation this step should
have to the foundations of the healthy social organism. One who knows
this will be able to find the appropriate tasks wherever he happens to
be, or wherever he decides to go. Acquisition of the insight referred
to here has been prevented by what has passed over, during a long
period of time, from human will into social institutions. People have
become so accustomed to these institutions that they have based on the
institutions themselves their views about what should be preserved in
them and what should be changed in them. Their thoughts conform to the
things, instead of mastering them. It is necessary today to perceive
that it is only possible to arrive at factual judgements through a
return to the primal thoughts which are the basis for all social
institutions.
If adequate sources are not present from which the forces that reside
in these primal thoughts constantly flow into the social organism,
then the institutions take on forms which inhibit rather than further
life. The primal thoughts live on, more or less unconsciously, in the
human instinctive impulses however, while fully conscious thoughts
lead to error and create hindrances to life. These primal thoughts,
which manifest themselves chaotically in a life inhibiting world, are
what underlie, openly or disguised, the revolutionary convulsions of
the social organism. These convulsions will not occur once the social
organism is structured in such a way that the tendency is prevalent to
observe at what point institutions diverge from the forms indicated by
the primal thoughts, and to counteract such divergences before they
become dangerously powerful.
In our times, divergences from the conditions required by the primal
thoughts have become great in many aspects of human life. The living
impulse of these thoughts stands in human souls as a vocal criticism,
through events, of the form the social organism has assumed during the
last centuries. Good will is therefore necessary in order to turn
energetically to the primal thoughts and not to underestimate how
damaging it is, especially today, to banish them from life as
impractical generalities. Criticism of what modern times
have made of the social organism exists in the life and in the demands
of the proletarian population. The task of our times is to counteract
the one-sided criticism by finding, in the primal thoughts, the
direction to be taken in order that events be consciously guided. For
the time has passed in which humanity can be satisfied with what
instinctive guidance is able to bring about.
One of the basic questions that has developed in contemporary
criticism is how to put an end to the oppression which proletarian
humanity has experienced through private capitalism. The owner, or
manager, of capital is in a position to put the physical labour of
other men at the service of whatever he undertakes to produce. It is
necessary to differentiate between three sectors in the social
relationship which arises through the cooperation of capital and human
labour: the managerial activity, which must be based upon the
individual abilities of a person or a group of persons; the
relationship of the manager to the worker, which must be a legal one;
the production of an article, which acquires commodity value in
economic circulation. Managerial activity can only participate soundly
in the social organism when forces are active in this organism which
allow individual human abilities to manifest themselves in the best
possible manner. This can only occur if there is a sector of the
social organism which allows capable individuals free initiative to
exercise their abilities, and enables the evaluation of these
abilities to be made through the free understanding of others. It is
evident that the social activity of a person utilizing capital belongs
in the sector of the social organism in which spiritual life provides
the laws and administration. Should the political state participate in
this activity, then a lack of appreciation of the effectiveness of
individual abilities must necessarily become a co-determining factor.
The political state must be based upon, and occupy itself with, those
requirements which are common and equal to all. It must, in its
sector, ensure that each individual is able to assert his opinion. The
appreciation or non-appreciation of individual abilities is not one of
its functions. Therefore, what takes place within its framework may
not influence the exercise of individual human abilities. Nor should
the prospect of economic gain be the determining factor in the
exercise of individual abilities through the use of capital. Many
critics of capitalism lay particular stress on this economic gain
factor. They assume that individual abilities can only be actuated by
this incentive. As practical people, they refer to
imperfect human nature, which they pretend to know. It is
true that, within the social order which contemporary conditions have
occasioned, the prospect of economic gain has attained enormous
importance. But this fact is no less the cause of the conditions which
are now being experienced. These conditions call urgently for the
development of some other motivation for the actuation of individual
abilities. This motivation will have to be found in the social
understanding which issues from a healthy spiritual life. With the
strength of free spiritual life the schools, education, will equip the
individual with impulses which, by virtue of this inherent
understanding, will enable him to put his personal abilities into
practice.
This opinion is by no means fantastic. Certainly fantastic notions
have caused as much damage in the field of social will as in any
other. But the view expressed here, as can be seen from the foregoing,
is not based upon the delusion that the spirit will work
wonders if only those who think they have some talk as much as they
can about it; it is rather the result of observing the free
cooperation of human beings in spiritual fields of endeavour. This
cooperation, when it is able to develop in the truly free manner,
acquires, through its own essence, a social form.
Only the unfree kind of spiritual life has, until now, prevented this
social form from emerging. Spiritual strength has been cultivated
within the ruling classes in a way that has unsocially restricted its
achievements to these classes. What was accomplished within these
classes could only be transmitted artificially to proletarian
humanity. And this part of humanity could draw no soul-sustaining
strength from spiritual life because it did not really participate in
these spiritual values. Institutes of popular adult
education, leading the people to an appreciation of
art, and similar actions, are not really valid means to the
propagation of spiritual values in the people as long as these
spiritual values retain the character they have taken on in recent
times. The people's innermost human essence is not to be
found in such values. They can therefore only look on from an outside
observation point. What holds true in respect of spiritual life proper
is also the case with the ramifications of spiritual activity which
flow into economic life along with capital. In a healthy social
organism the proletarian worker should not merely stand at his
machine, concerned with nothing but its operation, while the
capitalist alone knows the fate of the produced commodities in
economic circulation. Through fully active participation the worker
should be able to develop a clear idea of his own involvement in
society through his work on the production of commodities. Regular
discussions, which must be considered to be as much a part of the
operation as the work itself, should be arranged by management with a
view to developing ideas which circumscribe employer and employed
alike. A healthy activity of this kind will result in an understanding
by the worker that correct management of capital benefits the social
organism and therewith the worker himself. By means of such openness,
based on free mutual understanding, the entrepreneur will be induced
to conduct his business in an irreproachable manner.
Only someone who cannot sense the social effect of a common
undertaking's united inner experience will hold what has been said
here to be meaningless. Someone who can sense this effect will see how
economic productivity is stimulated when the capital-based management
of economic life has its roots in the free spiritual sector. The
interest in capital for the purpose of making and increasing profits
can only be replaced by an objective interest in the production of
commodities and in achievement if this prerequisite is met.
The socialistically-minded strive for the administration of the means
of production by society. What is justified in their efforts can only
be attained when this administration becomes the responsibility of the
spiritual sector. The economic coercion which the capitalist exercises
when he develops his activities from the forces of economic life will
thereby become impossible. And the paralyzing of individual human
abilities, as is the case when these abilities are administered by the
political state, cannot occur.
The proceeds from the use of capital and individual human abilities
must derive, as is the case with all spiritual effort, from the free
initiative of the doer on one side, and the free appreciation of those
others who require his efforts on the other. The determination of the
amount of these proceeds must be in agreement with the doer's own free
insight into what is suitable, taking into consideration his
preparation, expenditures, and so forth. His claims in this respect
will be satisfied only when his efforts are met with appreciation.
Through the kind of social arrangements described here, the ground can
be prepared for a truly free contractual relation between manager and
worker. This does not mean an exchange of commodities, i.e. money, for
labour-power, but an agreement as to the share each of the persons who
jointly produced the product is to receive.
What is achieved for the social organism with capital as its basis
depends, by its very nature, on how individual human abilities
intervene in this organism. The corresponding impulse for the
development of these abilities can only be obtained through a free
spiritual life. In a social organism in which the development of these
abilities is harnessed to a political state or to the economy, the
real productivity of everything requiring the expenditure of capital
depends upon free individual forces overcoming these paralyzing
conditions. But development under such conditions is unsound. Free
deployment of individual abilities in the use of capital has not been
the cause of conditions in which labour-power has become a commodity;
the fettering of these abilities by the political state or economic
interests is responsible for these conditions. Unprejudiced
comprehension of this fact is a prerequisite for everything which
should come about in the field of social organization. Modern times
have produced the superstition that the means for making the social
organism healthy can emerge from the political state or the economic
sector. If humanity continues in the direction indicated by this
superstition, social institutions will be created which will not lead
humanity to what it strives for, but to an unlimited increase in the
oppression which it seeks to avert.
People began thinking about capitalism at a time when it was the cause
of a deterioration in the social organism. One experiences this
deterioration and sees that it must be fought against. It is necessary
to see more. One must become aware that the illness has its origin in
the draining of the effective forces in capital by the economic
process. Only by avoiding the illusion caused by the manner of
thinking which sees the management of capital by a liberated spiritual
sector as the result of impractical idealism, is it
possible to work in the direction which the evolutionary forces of
contemporary humanity are beginning to demand.
Certainly people are poorly prepared at the present time to directly
relate the social ideas, which are to guide capitalism along a healthy
course, with spiritual life. Only economic life is taken into
consideration. It is easily seen how, in modern times, commodity
production has led to large-scale enterprise, and this in turn to the
contemporary form of capitalism. Cooperatives, which work to satisfy
the needs of the producers, are supposed to take the place of this
economic form. Since modern means of production are obviously to be
retained however, the concentration of all enterprises in one great
cooperative is called for. In such a system, it is thought, each
person would produce on behalf of the community, which could not be
exploitive because it would be exploiting itself. And because one
must, or wants to, relate to what already exists, one looks to the
modern state, which is to be transformed into an all-embracing
cooperative.
It is not realized that what is expected of such a cooperative is less
likely to occur the larger it becomes. If the integration of
individual human abilities into the cooperative organism is not
structured as described here, then the common management of labour
cannot lead to the social organism's recovery.
The present meager inclination towards an unbiased judgement as far as
the intervention of spiritual life in the social organism is
concerned, is the result of people having become accustomed to imagine
the spiritual as being as far removed as possible from everything
which is material and practical. They will not be few who will find
something grotesque in the view expressed here, that the actuation of
capital in economic life should partially manifest the effects of the
spiritual sector. One can well imagine that the members of the
hitherto ruling classes are in agreement with socialist thinkers on
this point.
In order to recognize the importance for the recovery of the social
organism of what they consider grotesque, one must direct one's
attention to certain contemporary currents of thought which, in their
way, derive from honest impulses of the soul, but hinder the
development of real social thinking wherever they find entry.
These currents of thought flow more or less unconsciously
away from what gives inner experience the right impulse. They
strive after a philosophy and an inner life of the soul and intellect
which accords with the search for scientific knowledge, but which is
like an island in the sea of human existence. They are not able to
build a bridge from that life to the everyday life of reality. One can
see how many people nowadays find it fashionable to
reflect, in their ivory towers, in scholastic abstractions on all
kinds of ethical-religious problems; one can see how people reflect on
how man can acquire virtues, how he should behave lovingly toward his
fellow-men, and how he can become inspired with an inner meaning
of life. But one also sees the impossibility of realizing a
carry-over from what people call good and loving and benevolent and
right and moral to what surrounds humanity in everyday external
reality in the form of capital, of labour compensation, of
consumption, of production, of commodity circulation, of credit, of
banks and stock markets. One can see how two universal currents also
flow alongside each other in human thought-habits. One current is that
which remains at divine-spiritual heights so to speak, and has no
desire to build bridges between what constitutes a spiritual impulse
and the realities of the ordinary dealings of life. The other lives,
devoid of thought, in everyday life. Life, however, is a unity. It can
only prosper if the strength from ethical-religious life works down
into the commonplace, profane life, into that life which, to many, may
seem less fashionable. For if one fails to erect a bridge between
these two aspects of life, one falls into mere fantasy, far removed
from true everyday reality as far as religious and moral life and
social thinking are concerned. These true everyday realities then have
their revenge. From out of a certain spiritual impulse man
strives towards all kinds of ideals, towards what he calls
good; but he devotes himself without spirit to
those other instincts based on the ordinary daily necessities of life
which must be satisfied through economic activities. He knows of no
practicable way from the concept of spirituality to what goes on in
everyday life. Therefore this life takes on a form having nothing to
do with ethical impulses, which remain at fashionable, spiritual
heights. But then the revenge of the commonplace is such that the
ethical-religious life constitutes an inner lie, for it remains at a
distance from the commonplace, out of direct contact with practical
life, without this fact even being perceived.
How many people there are nowadays who, through ethical-religious
high-mindedness, demonstrate the best will to live correctly together
with their fellow-men, wishing their fellows only the very best. They
fail, however, to adopt the necessary sensibilities, for they cannot
acquire the concrete social concepts which affect the practical
conduct of life.
It is people such as these, fantasts who think they are practical, who
in this historical moment when the social questions have become so
urgent, hinder all real progress. One can hear them speak as follows:
It is necessary for humanity to rise up from materialism, from
the external material life which has driven us into the catastrophe of
the world-war, and turn to a spiritual conception of life. In
order to show the path to spirituality, they never tire of citing the
personalities of the past who were venerated for their spiritual way
of thinking. If, however, one tries to indicate what the spirit must
necessarily accomplish today in practical life, how daily bread must
be produced, it is immediately contended that first of all people must
be brought to once again acknowledge the spirit. But the heart of the
matter today is that the guidelines for the recovery of the social
organism are to be found in the strength of spiritual life. For this
it is not sufficient that people occupy themselves with the spirit as
a sideline. For this it is necessary that everyday life become
spiritually oriented. The tendency to treat spiritual life
as a sideline has led the hitherto ruling classes to acquire a taste
for social conditions which have resulted in the current state of
affairs.
In contemporary society, management of capital for the production of
commodities is closely allied to the possession of the means of
production which is also capital. Nevertheless, these two
relationships of man to capital are quite different as far as their
effects within the social organism are concerned. Management through
individual abilities, when they are properly exercised, supplies the
social organism with goods in which everyone who belongs to this
organism has an interest. Whatever a person's situation in life, it is
in his interest that nothing be lost of what flows from the sources of
human nature in the form of individual abilities, by means of which
the goods are produced that purposefully serve human life. The
development of these abilities can only ensue when their possessors
are able to activate them with their own free initiative. The welfare
of mankind is, at least to a certain extent, deprived of whatever is
not able to flow from these sources in freedom. Capital is the means
by which such abilities are made effective for wide areas of the
social organism. Everyone within a social organism must have a real
interest in the sum total of capital being managed in such a way that
particularly gifted individuals or groups have this capital at the
disposal of their own free initiative. Every person, whether his work
is spiritually creative or that of a labourer, if he wishes to
objectively serve his own interests, must say: would like a
sufficiently large number of competent persons or groups of persons
not only to have capital freely at their disposal, but also that it
become accessible to them through their own initiative. For only they
can judge how their individual abilities, through the mediation of
capital, will purposefully produce goods for the social organism.
It is not necessary to describe within the framework of this book how,
in the course of human evolution, private ownership developed out of
other forms of ownership in connection with the activation of
individual human abilities. In recent times, ownership has developed
within the social organism under the influence of the division of
labour. We are concerned here with contemporary conditions and their
necessary further development.
However private ownership may have arisen, through the exercise of
power, conquest and so forth, it is a result of social creation bound
to individual human abilities. Nevertheless, the current opinion of
the socialistically-minded is that the oppressive nature of private
ownership can only be done away with through its transformation into
common ownership. The question is put so: How can the private
ownership of the means of production be prevented, in order that the
resulting oppression of the unpropertied cease? Whoever puts the
question in this way overlooks the fact that the social organism is
constantly becoming and growing. It is not possible to ask how
something that grows should be organized in order that this
organization, which is thought to be correct, be preserved into the
future. One can think in this way about something which remains
unchanged from its beginnings. But it is not valid for the social
organism. As a living entity it is constantly changing whatever arises
within it. To attempt to give it a supposedly best form, in which it
is expected to remain, is to undermine its vitality.
One of the conditions of the social organism's life is that those who
can serve the community through their individual abilities should not
be deprived of using their free initiative. Where such service
requires that the means of production be freely at their disposal, the
hindering of this free initiative would only be harmful to the general
social interest. The usual argument, that the entrepreneur needs the
prospect of profit as an incentive, and that this profit is closely
related to ownership of the means of production, is rejected here. The
kind of thinking from which the opinions expressed in this book
derive, that there is a further evolution of social conditions, must
see in the liberation of spiritual life from the political and
economic sectors the possibility that this form of incentive can cease
to exist.
Liberated spiritual life will, necessarily, develop social
understanding; and from this understanding will result quite different
forms of incentive than that which resides in the hope of economic
advantage. However, it is not a question of which impulses arouse
sympathy for private ownership of the means of production, but whether
the free disposition of these means or that disposition which is
regulated by the community is what corresponds to the vital needs of
the social organism. Moreover, it must always be kept in mind that the
conditions which are thought to be observed in primitive human
societies are not applicable to the contemporary social organism; only
those conditions which correspond to today's stage of development are
applicable.
At this present stage, a fertile activation of individual abilities
cannot be introduced into the economic process without free
disposition over capital. If production is to be fruitful, this
disposition must be possible, not because it is advantageous to an
individual or a group of individuals, but because, when utilized with
the proper social understanding, it can best serve the community.
The human being relates to what he produces, alone or together with
others, as he relates to the dexterity of his own limbs. The
undermining of free disposition over the means of production is
equivalent to crippling the free application of dexterity in his
limbs.
Private ownership is, however, nothing other than the medium for this
free disposition. As far as the social organism is concerned, the only
significance of ownership is that the owner has the right of
disposition over the property through his own free initiative. One
sees that in society two things are bound together which have quite
different significance for the social organism: The free disposition
over the capital base of social production, and the legal relationship
through which he who exercises this disposition, by means of his right
of disposition, precludes others from the free utilization of this
capital base.
It is not the original free disposition which leads to social damage,
but only the prolongation of the right of disposition when the
appropriate conditions which connect individual human abilities to
this disposition have ceased to exist. Whoever sees the social
organism as something evolving, growing, will not misunderstand what
is indicated here. He will seek possibilities whereby that which
serves life on the one hand can be administered so that its effects
will not be harmful on the other. What lives cannot be fruitfully
established without disadvantages occurring during the process of
becoming. And should one work on an evolving entity, as man must on
the social organism, then the task may not be to hinder a necessary
facility in order to avoid damage, for then one would undermine the
possibilities for life of the social organism. It is a matter of
intervening at the right moment, when what has been appropriate is
about to become harmful.
The possibility of free disposition over the capital base through
individual abilities must exist; it must be possible to change the
related property rights as soon as they become a means for the
unjustified acquisition of power. We do have a facility in our times
which partially fulfils this requirement in respect of so-called
intellectual property. At a certain time after its creator's death it
becomes community property. This corresponds to a truly social way of
thinking. Closely as the creation of a purely intellectual property is
bound to an individual's talents, it is at the same time a product of
human society and must, at the right moment, be handed over to this
society. It is in no way different with respect to other property.
That which the individual produces in the service of the community is
only possible in cooperation with this community. The right of
disposition over a property cannot be administered separate from the
community's interests. A means of eliminating the ownership of the
capital base is not to be sought, but rather a means of administering
this property so that it best serves the community.
This means can be found in the threefold social organism. The people,
united in the social organism, act as a totality through the
rights-state. The exercise of individual abilities pertains to the
spiritual organization.
Everything in the social organism, when viewed realistically and
without subjective opinions, theories, desires and so forth, indicates
the necessity for the triformation of the social organism. This is
particularly true as regards the relation of individual human
abilities to the capital base of economic life and the ownership of
this capital base. The rights-state will not have to prevent the
formation and administration of privately-owned capital as long as
individual abilities remain bound to the capital base in a way that
constitutes a service to the whole of the social organism.
Furthermore, it will remain a rights-state in regard to private
property, never making private property its own, but ensuring that
rights of disposition are transferred at the right moment to a person
or a group of persons capable of restoring the appropriate individual
relationship to the property. The social organism will thereby be
served from two completely different angles. The democratic rights
state, which is concerned with what affects all people in an equal
manner, will guard against property rights becoming property wrongs.
Because this state does not itself administer property, but ensures
its transfer to individual human abilities, these abilities will
develop their productive powers for the totality of the social
organism. Through such organization, property rights, or the
disposition over them, may retain a personal element as long as seems
opportune. One can imagine that the representatives in the
rights-state will, at different times, enact completely different laws
concerning the transference of property from one person, or group of
persons, to others. At the present time, when a great mistrust of all
private property is widespread, a radical transference of private
property to community property is contemplated. Should this way be
followed, it will be seen to impair the vital potentialities of the
social organism. Taught by experience, another way will then be taken.
It would, however, doubtless be better if arrangements were undertaken
now which would, in the sense indicated here, bestow health on the
social organism. As long as a person alone, or in connection with a
group, continues the productive activity which procured for him a
capital base, his right of disposition over the capital accumulation
which results from operating profits on original capital will have to
remain in effect when it is used for an expansion of production. From
the moment such a person ceases to manage production, this capital
accumulation should pass to another person, or group of persons, to be
utilized for the same or some other type of production which serves
the social organism. Capital gains which are not used for expansion
should be similarly treated. The only thing personally owned by the
individual who operates an enterprise should be what he draws in
accordance with the terms agreed to when he takes over responsibility
for production, and which he feels are appropriate to his individual
abilities; and which, furthermore, seem justified by the confidence of
others in granting him the use of capital. Should the capital be
increased through the activities of this individual, then he would be
entitled to a portion of the increase, which would correspond to an
interest-like percentage. When the first administrator no
longer can or will manage an enterprise, the capital with which it was
established will either be transferred to a new administrator, along
with all obligations or, depending on the wishes of the original
owners, be returned to them.
Such arrangements concern the transference of rights. The legal
provisions by which these transfers are to take place are the province
of the rights-state. It will also have to see to their execution and
administration. One can safely assume that the detailed determinations
which regulate such rights transfers will vary according to what
rights-awareness considers correct. A realistic way of thinking will
never desire more than to point out the direction that such regulation
can take. If this direction is taken with understanding, the
appropriate action for specific individual cases can always be found.
The correct solution will always have to be in accordance with the
spirit of the thing as well as whatever special conditions practical
considerations may impose. The more realistic a way of thinking is,
the less it will seek to establish laws and rules from predetermined
requirements. On the other hand, the spirit of such a way of thinking
will necessarily lead to certain requirements. One such result will be
that the rights-state will never take over the disposition of capital
through its administration of transfer rights. It has only to provide
for the transfer to a person or group of persons whose individual
abilities seem to warrant it. In general, it follows that it should at
first be possible for someone who proposes to effect such a capital
transference under the circumstances described to freely choose his
successor. He will be able to choose a person, or group of persons, or
transfer the disposition rights to an establishment of the spiritual
organization. A person who has purposefully served the social organism
through the management of capital will determine the future use of
this capital with social understanding derived from his individual
abilities. Furthermore, it will be more advantageous for the social
organism to depend upon this determination than to dispense with it
and have settlements made by people not directly concerned with the
matter.
Settlements of this kind will pertain to capital accumulations
exceeding a certain amount which are acquired by a person or group
through the use of means of production (to which real estate also
belongs), and which are not included in what Is originally agreed upon
as compensation for the activities of individual abilities.
Such earnings, acquisitions and savings which result from the
individual's own work will remain in his personal possession until his
death, or in his descendants' possession until a later date. Until
this date interest (the amount of which is to be determined from
rights-awareness and set by the rights state) will be paid by whoever
receives such savings for the procurement of means of production. In a
social order based upon the principles described herein, it will be
possible to completely separate the proceeds which result from the use
of means of production from assets acquired by means of personal
(physical and mental) work. This separation accords with
rights-awareness as well as the interests of the social community.
What someone saves and makes available for production serves the
general interest, for it makes the management of production through
individual human abilities possible in the first place. Capital
increase through the use of means of production after the
deduction of legitimate interest owes its development to the
overall social organism. It should therefore also flow back into it in
the way described. The rights-state has only to insure that the
transference of the capital in question takes place in the manner
indicated; it will not be incumbent upon it to decide which material
or spiritual production is to have disposition over transferred
capital or over savings. That would lead to a tyranny of the state
over spiritual and material production which is best
administered through individual human abilities. In case someone does
not wish to personally select the receiver of capital accumulated by
him, he will be able to delegate this function to an unit of the
spiritual organization.
After the death of the earner, or at a certain time thereafter, assets
acquired through savings, along with the corresponding interest, also
go to a spiritually or materially productive person or group
but only to such a person or group and not to an unproductive person
in whose hands it would constitute a private pension to be
chosen by the earner and specified in his will. Here again, if a
person or group cannot be chosen directly, the transfer of disposition
rights to an establishment of the spiritual organism will come into
consideration. Only if someone does not himself effect a disposition
will the rights-state step in and, through the spiritual organization,
make the disposition for him.
In a social order arranged in this way the initiative of the
individual as well as the interests of the social community are taken
into account. Indeed, such interests are fully satisfied by individual
initiatives being placed at their service. Under such an arrangement,
someone who entrusts his labour to the guidance of another will know
that the results of their joint efforts will serve the community, and
therewith the worker himself, in the best possible way. The social
order meant here will create a healthy, sensible relationship between
capital, as embodied in means of production, together with human
labour-power on the one hand, and the prices of the articles produced
by them on the other. Perhaps imperfections are contained in what is
presented here. Then let them be found. It is not the function of a
way of thinking which corresponds to reality to formulate perfect
programs for all time, but to point out the direction for
practical work. The intention of the specific examples mentioned here
is to better illustrate the indicated direction. A productive goal can
still be attained as long as improvements coincide with the direction
given.
Justified personal or family interests will be brought into
concordance with the requirements of the human community through such
arrangements. It is of course possible to point out that there will be
a strong temptation to pass on property to one or more descendants
during the original owner's lifetime. Also, that although descendants
could be made to look like producers, they would nevertheless be
inefficient compared to others who should replace them. This
temptation could be reduced to a minimum in an organization governed
by the arrangements described above. The rights-state has only to
require that under all circumstances property transferred from one
family member to another must, upon the lapse of a certain period of
time after the death of the former, devolve upon an establishment of
the spiritual organization. Or evasion of the rule can be prevented in
some other way through the law. The rights-state will only insure that
the transfer takes place; a facility of the spiritual organization
should determine who is to receive the inheritance. Through the
fulfilment of these principles an awareness will develop of the
necessity for offspring being made qualified for the social organism
through education and training, and of the socially harmful results of
transferring capital to unproductive persons. Someone who is really
imbued with social understanding will have no interest in his relation
to a capital base passing to a person or group whose individual
abilities do not justify it.
No one with a sense for the truly practicable will consider what is
presented here as utopian. The only arrangements proposed are those
which can develop in accordance with contemporary conditions in all
walks of life. It is only necessary to decide once and for all that
the rights-state must gradually relinquish its control over spiritual
life and the economy, and not to offer resistance when what should
happen really happens: that private educational institutions arise and
the economy becomes self-sustaining. The state-owned schools and
economic enterprises do not have to be eliminated overnight; but the
gradual dismantling of the state educational and economic apparatus
could well develop from small beginnings. Above all, it is necessary
for those who are thoroughly convinced of the correctness of these or
similar social ideas to provide for their dissemination. If these
ideas find understanding, confidence will arise in the possibility of
a healthy transformation of present conditions into others which are
not harmful. This is the only confidence that can bring about a really
healthy evolution, for whoever would acquire this confidence must
perceive how new institutions could be practically merged with
existing ones. The essential element of the ideas developed here is
that they do not advocate the advent of a better future through even
greater destruction of society than has already occurred, but that the
realization of such ideas is to come about by building upon what
already exists. Through this building, the dismantling of the
unhealthy elements is induced. Explanations which do not instill
confidence of this sort cannot attain what absolutely must be
attained: a course in which the value of what has hitherto been
produced, and the abilities which have been acquired, are not simply
thrown overboard, but are preserved. Even those who think in a very
radical way can acquire confidence in a new social structure which
carries over existing values, if the ideas which accompany it are
capable of introducing truly healthy developments. Even they must
realize that, regardless of which social class attains power, it will
not be able to eliminate the existing evils if its impulses are not
supported by ideas which make the social organism healthy and viable.
To despair because one does not believe that a sufficiently large
number of people, even in the present troubled circumstances, can find
understanding for such ideas even if sufficient energy is dedicated to
their dissemination, is to despair of human nature's susceptivity to
purposeful and health-giving impulses. This question, whether one
should despair or not, should not be asked rather only this
other: How can ideas which instill confidence be explained in the most
effective possible way?
An effective dissemination of the ideas presented here will meet
opposition from the thought-habits of contemporary times on two
grounds. Either it will be argued that to tear asunder uniform society
is not possible because the three sectors which have been described
are, in reality, interrelated at all social levels; or that the
necessary autonomous character of each of the three sectors can also
be attained in the uniform state, and that what is presented here is
no more than a phantasy. The first objection unrealistically supposes
that unity can only be achieved in a community by means of directives.
Reality, however, demands the opposite. Unity must arise as the result
of activities streaming together from various directions. The
developments of recent years have run counter to this reality.
Furthermore, what lives in human beings has resisted the
order brought into their lives from without which has led
to the present state of social affairs.
The second prejudice results from an inability to perceive the radical
difference in function inherent In the three sectors of society. It is
not seen how the human being has a special relation to each of the
three sectors which can only develop if an individual basis exists,
separate from the other two but cooperating with them, on which this
relation can take on form. According to the physiocratic theory of the
past, either governments take measures concerning economic life which
are in contradiction to its self-development in which case such
measures are harmful; or the laws coincide with the direction economic
life takes when it is left alone in which case they are
superfluous. Academically, this view is antiquated; as thought-habit
however, it still devastatingly haunts men's brains. It is thought
that if one sector of life follows its own laws, then everything
necessary for life must arise from this sector. If, for example,
economic life were regulated in a way that people found satisfactory,
then the appropriate rights and spiritual sectors would also result
from this orderly economic foundation. But this is not possible, and
only thinking which is foreign to reality can believe that it is
possible. There is nothing in the economic sector to provide the
motivation necessary to regulate what derives from the
rights-awareness of a person-to-person relationship. If this
relationship is regulated according to economic motivation, then the
human being, together with his labour and with the disposition over
the means to labour, is harnessed to economic life. He becomes a cog,
a mechanism of the economic system. Economic life tends to move in one
direction only, and this must be compensated for from another side.
Legal measures are not necessarily good when they follow the direction
determined by economic life, nor are they necessarily harmful when
they run counter to it; rather, when the direction of economic life is
continually influenced by the law, in its application to human beings
as such, then an existence worthy of humanity will be introduced into
economic life. Furthermore, only when individual abilities are
completely separated from economic life, when they grow on their own
foundation and unceasingly supply economic life with the strength
which it cannot produce within itself, will it be able to develop in a
manner which is beneficial to humanity.
It is noteworthy that in everyday life one easily sees the advantage
of the division of labour. One does not expect a tailor to keep his
own cow in order to have milk. As far as the comprehensive formation
of human life is concerned however, one believes that only a uniform
structure can be useful.
It is inevitable that social ideas which correspond to reality will
give rise to objections from all sides for real life breeds
contradictions. He who thinks realistically will seek to institute
facilities the contradictions of which are compensated for by other
facilities. He may not believe that a facility which to his mind is
ideally good will, when put into practice, be without
contradictions. Contemporary socialism is thoroughly justified when it
demands that the modern facilities which produce for the profit of
individuals be replaced by others which produce for the consumption of
all. However, the person who fully recognizes this demand cannot come
to modern socialism's conclusion: that the means of production must
pass from private ownership to common ownership. Rather, he will come
to a quite different conclusion: that what is privately produced
through individual competence must be made available to the community
in the correct way. The impulse of modern industry has been to create
income through the mass production of goods. The task of the future
will be to find, through associations, the kind of production which
most accords with the needs of consumption, and the most appropriate
channels from the producers to the consumers. Legal arrangements will
ensure that a productive enterprise remains connected to a person or
group only as long as the connection is justified by their individual
abilities. Instead of common ownership of the means of production, a
circulation of these means continually putting them at the
disposal of the persons whose individual abilities can best employ
them for the benefit of the community will be introduced into
the social organism. In this way the connection between individuality
and means of production, hitherto effected through private ownership,
is established on a temporary basis. The manager and sub-managers of
an enterprise will have the means of production to thank for the fact
that their abilities can provide them with the income they require.
They will not fail to make production as efficient as possible, for an
increase in production, although not bringing them the full profit,
does provide them with a portion of the proceeds. As described above,
the profit goes to the community only after an interest has been
deducted and credited to the producer due to the increase in
production. It is also in the spirit of what is presented here that
when production falls off the producer's income is to diminish in the
same measure as it increases with an expansion of production.
Additional income will always result from the manager's mental
achievement, and not from the forces inherent in community
cooperation.
Through the realization of such social ideas as are presented here,
the institutions which exist today will acquire a completely new
significance. The ownership of property ceases to be what it has been
until now. Nor is an obsolete form reinstated, as would be the case
with common ownership, but an advance to something completely new is
made. The objects of ownership are introduced into the flux of social
life. They cannot be administered by a private individual for his
private interests to the detriment of the community; but neither will
the community be able to administer them bureaucratically to the
detriment of the individual; rather will the suitable individual have
access to them in order therewith to serve the community.
A sense for the common interest can develop through the realization of
impulses that put production on a sound basis and safeguard the social
organism from the dangers of crises. Also, a management which only
occupies itself with economic processes will be able to carry out the
necessary adjustments. For example, should a company which is
fulfilling a need not be in a position to pay its creditors the
interest due them on their savings, other companies, in free agreement
with all concerned, could make up whatever is lacking. A
self-contained economic process which receives both its legal basis
and a continuous supply of individual human abilities from outside
itself will be able to restrict its activities to the economic sector.
It will therefore occasion a distribution of goods which will ensure
that each receives what he is entitled to in accordance with the
community's welfare. If one person appears to have more income than
another, this will only be because this more benefits the
community due to his individual abilities.
In a social organism which functions in accordance with the manner of
thinking presented here, the contributions necessary for the upkeep of
rights institutions will be arranged through agreement between the
leaders of the rights sector and the economic sector. Everything
necessary for the maintenance of the spiritual organization, including
remuneration, will come to it through the free appreciation of the
individuals who participate in the social organism. A sound basis for
the spiritual organization will result from free competition among the
individuals capable of spiritual work.
Only in a social organism of the kind described here will the rights
administration be able to acquire the understanding necessary for a
just distribution of goods. An economic organism which does not lay
claim to human labour according to the needs of the various branches
of production, but which has to operate in accordance with what the
law allows, will determine the worth of commodities according to the
work-performance of the men who produce them. Commodity values, which
are unrelated to human welfare and dignity, will not determine human
work-performance. Rights in such an organism will result from purely
human relations. Children will have the right to education; the
working head of a family will have a higher income than a single
person. The more will come to him through arrangements
established by agreement of all three social organizations. The right
to education could be arranged in that the economic organization's
administration, in accordance with the general economic situation,
calculates the amount of educational income possible, while the
rights-state, in consultation with the spiritual organization,
determines the rights of the individual in this respect. Once again,
this indication is meant as an example of the direction in which
arrangements can be made. It is possible that quite different
arrangements would be appropriate in specific cases. However, they can
only be found through the purposeful cooperation of the three
autonomous members of the social organism. Contrary to what often
passes for practical today but is not, this presentation wishes to
find the truly practical, namely, a formation of the social organism
which enables men to strive for what is socially desirable. Just as
children have the right to an education, the elderly, the infirm and
widows have the right to a decent maintenance. The necessary capital
must be provided for in the same way that it is for the education of
those who are not yet productive. The essential point of all this is
that the income of the non-earners Is not determined by the economic
sector; on the contrary, the economic sector becomes dependent upon
the results of rights-awareness. Those who work In an economic
organism will receive that much less from the results of their work as
more flows to the non-earners. However, this less will be
borne equally by all participants in the social organism if the social
impulse described here is realized. The education and support of those
who are incapable of working is something which concerns all humanity,
and, through a rights-state detached from the economy, it will be so,
for every individual who is of age will have a voice in the
rights-organization.
In a social organism which corresponds to the manner of thinking
characterized here, a person's surplus performance, made possible by
his individual abilities, will be passed on to the community just as
the legitimate support for the deficit performance of the less capable
will be drawn from this same community. Surplus value will
not be created for the enjoyment of individuals, but for the increased
supply of intellectual or material wealth to the social organism; and
for the cultivation of what is produced within this organism but which
is not of immediate use to it.
Whoever is of the opinion that keeping the three sectors of the social
organism apart would only have an ideal value, and that this condition
would come about of itself in a uniformly structured state
organism or in an economic cooperative which Includes the state and is
based on the common ownership of means of production, should direct
his attention to the special kind of social facilities which must
result from a realization of the triformation. The legitimacy of money
as a means of payment, for example, would no longer be the
responsibility of the government, but would depend upon measures taken
by the administrative bodies of the economic organization. Money, in
an healthy social organism, can be nothing other than a draft on
commodities produced by others, which the holder may claim from the
overall social organism because he has himself produced and delivered
commodities to this sector. An economic sector becomes a uniform
economy through the circulation of money. Each produces for all on the
roundabout path of economic life. The economic sector is only
concerned with commodity values. Activities which originate in the
spiritual or state organizations also take on a commodity character
for this sector. A teacher's activity with respect to his pupils is,
for the economic process, of a commodity nature. A teacher is no more
paid for his individual abilities than the worker is paid for his
labour-power. It is only possible to pay for what they both produce as
commodities for the economic process. How free initiative and the law
should contribute to the production of commodities lies just as much
outside the economic process as the effects of the forces of nature on
the grain yield in a bountiful or in a lean year. As far as the
economic process is concerned the spiritual organization, in respect
to its economic requirements, and also the state, are simply commodity
producers. What they produce within their own sectors are not
commodities however; they only become such once they enter into the
economic process. Their activities are not commercial within their own
sectors; the economic organism's management carries on its commercial
activities using the achievements of the other sectors.
The purely economic value of a commodity (or service), in so far as it
is expressed in the money which represents its equivalent value, will
be dependent upon the efficiency with which economic management
functions. The development of economic productivity will depend upon
the measures taken by this management, with its spiritual and legal
foundation provided by the other two members of the social organism.
The monetary value of a commodity will then express the fact that the
facilities of the economic organism are producing these commodities in
an amount which corresponds to the need for them. Should the
suggestions contained in this book be realized, then the economic
impulse to accumulate wealth through sheer quantity of production will
no longer be decisive; rather will the associations adapt the
production of goods to actual need. In this way a need-oriented
relation between monetary values and the production facilities in the
economic organism will develop.* In the healthy social organism money
will really only be a measure of value, since commodity production,
the only means through which the possessor of money will have been
able to attain it, will back every coin and bank note. Due to the
nature of these relations, arrangements will have to be made whereby
money loses its value for its possessor once it has lost this
significance. Such arrangements have already been alluded to. Property
in the form of money passes on to the community after a certain length
of time. In order to prevent money which is not working in productive
enterprises being retained through evasion of the economic
organization's measures, a new printing could take place from time to
time. One result of such measures is that the interest derived from
capital would diminish in the course of time. Money will wear out,
just as commodities wear out. Nevertheless, such a measure will be a
just and appropriate one for the state to enact. There cannot be any
interest on interest. Whoever has accumulated savings has
surely also rendered services which entitle him to claim reciprocal
services in the form of commodities, just as present day efforts give
claim to reciprocal efforts; but these claims are subject to limits,
for claims originating in the past can only be satisfied by
performance in the present. They may not be allowed to turn into means
of economic power. Through the realization of these conditions, the
currency question is given a healthy foundation. Regardless of what
form money takes due to other considerations, currency as such depends
on the rational administration of the overall social organism. No
political state will ever solve the currency question in a
satisfactory manner by making laws.
Contemporary states will only solve it by renouncing their efforts at
reaching a solution and leaving the necessary measures to an
autonomous economic organism.
* Only a social administration based on the free cooperation of the
social organism's three sectors will attain a healthy price
relationship for produced goods. Each working person must receive for
a product an amount sufficient to completely satisfy his and his
dependents' needs until he has again produced an object requiring the
same amount of labour. Such a price relation cannot be officially
established, but must result from cooperation between the associations
active in the social organism. And it will come if the cooperation
rests on a healthy relationship between the three members of the
social organization, just as a durable bridge must result if it is
built according to correct mathematical and mechanical laws. One could
make the obvious objection that society does not necessarily follow
its laws as a bridge does. Such an objection will not be made however,
by those who recognize that in this book social life is presented as
based on living and not on mathematical laws.
Much has been said about the modern division of labour, about its
time-saving effects, its contribution to perfecting the production
process and the exchange of commodities, etc., but little attention
has been paid to how it influences the individual's relation to his
work performance. Whoever works in a social organism which is based on
the division of labour never really earns his income by himself; he
earns it through the work of all the participants in the social
organism. A tailor who makes his own coat does not do so in the same
sense as a person living in a primitive society who must provide for
all his necessities himself.
He makes the coat in order to be able to make clothes for others; and
the coat's value for him depends on the others' work performance. The
coat is actually a means of production. Some would call this
hair-splitting. They cannot, however, continue to hold this opinion as
soon as they observe how commodity values form in the economic
process. They then see that it is not even possible to work for
oneself in an economic organism based on the division of labour. One
can only work for others, and let others work for oneself. One can no
more work for oneself than one can devour oneself. Arrangements may be
made which are in contradiction to the principle of the division of
labour however. This occurs when goods are produced merely in order to
turn over to an individual as property what he is able to produce only
because of his position in the social organism. The division of labour
exerts pressure on the social organism which has the effect of causing
the individual in it to live according to the conditions prevalent in
the overall organism; economically, it precludes egoism. Should egoism
be present nevertheless in the form of class privilege and the like,
an untenable situation arises which leads to severe disturbances in
the social organism. We are living under such conditions today. There
may well be many people who think little of a demand that the law and
other facilities conform to the egoism-free working of the division of
labour. They should then realize the consequences of this attitude:
that one can do nothing at all; the social movement will lead to
nothing. One can certainly do nothing with this movement without
respecting reality. The manner of thinking from which the writing of
this book is derived intends that the human being strive toward what
is necessary for the life of the social organism.
Someone who can only form concepts in accordance with customary
practices will be uneasy when he hears that labour-management
relations should be disengaged from the economic organism. He will
believe that such a disengagement would necessarily lead to currency
devaluation and a return to primitive economic conditions. (Rathenau
expresses such opinions, which seem justified from his point of view,
in his book Nach der Flut.)
[Note 6]
But this danger will be counteracted through the triformation of the
social organism. The self-sustaining economic organism, in cooperation
with the rights organism, will completely separate the monetary
element from rights-oriented labour relations. Legal facilities will
not have a direct influence on monetary affairs, for these are the
province of the economic administration. The legal relationship
between management and labour will not express itself in monetary
values which, after the abolition of wages (representing the exchange
relation between commodities and labour-power), will only measure
commodity (and service) values. From a consideration of the social
triformation's effect on the social organism, one must conclude that
it will lead to arrangements which are not present in the political
forms which have hitherto existed.
Through these arrangements, what is currently referred to as class
struggle can be eliminated. This struggle results from wages being an
integral part of the economic process. This book presents a social
form in which the concept of wages undergoes a transformation, as does
the old concept of property. Through this transformation a more viable
social cooperation is made possible.
It would be superficial to think that the realization of the ideas
presented here would result in time-wages being converted into
piece-wages. A one-sided view could lead to this opinion. However,
what is advocated here is not piece-wages, but the abolishment of the
wage system in favour of a contractual sharing system in respect of
the common achievements of management and labour in
conjunction, of course, with the overall structure of the social
organism. To hold that the workers' share of the proceeds should
consist of piece-wages is to fail to see that a contractual sharing
system in no sense a wage system expresses the value of
what has been produced in a way which changes the workers' social
position in relation to the other members of society. This position is
completely different from the one which a rose through one-sided,
economically conditioned class supremacy. The need for the elimination
of the class struggle is therewith satisfied.
In socialist circles one frequently hears that evolution will supply
the solution to the social question, that one cannot express opinions
and then expect them to be put into practice. This must be answered as
follows: Certainly evolution must supply the necessary social
adjustments; but in the social organism the impulses behind human
ideas are realities. When the times are more advanced and what today
can only be thought is realized, only then will what has been thought
be contained in evolution. However, it will then be too late to
accomplish what is already demanded by today's events. It is not
possible to consider evolution objectively as regards the social
organism. One must activate evolution. It is therefore disastrous for
sound social thinking that current opinion desires to
prove social necessities in the same way that natural
science proves things. Proof, as far as social
conceptions are concerned, can only be attained if one's views can
assimilate not only what exists now, but also what is present in human
impulses as potentiality striving to be realized.
One of the effects through which the triformation of the social
organism will prove itself to be based on the essential nature of
human society is the severance of judicial activities from state
institutions. It will be incumbent on the latter to establish the
rights between persons or groups of persons. Judicial decisions
however, will depend upon facilities formed by the spiritual
organization. This judicial decision making is, to a large extent,
dependent on the judge's ability to perceive and understand the
defendant's situation. Such perception and understanding will be
present if the confidence which men feel towards the facilities of the
spiritual organization is extended to include the courts. The
spiritual organization might nominate judges from the various cultural
professions. After a certain length of time they would return to their
own professions. Within certain limits, every person would then be
able to select the nominee, for a period of five or ten years, in whom
he has sufficient confidence to accept his verdict in a civil or
criminal case, should one arise. To make such a selection meaningful,
there would have to be enough judges available in the vicinity of each
person's place of residence. A plaintiff would always be obliged to
direct himself to a competent judge in the respondent's vicinity.
Just consider the importance such an arrangement would have had in the
Austro-Hungarian districts. The members of each nationality in
mixed-language districts could have chosen judges from their own
people. Whoever is familiar with the Austrian situation will recognize
what a compensatory effect such an arrangement could have had in the
life of those peoples. Aside from the nationality question, there are
other areas in which such arrangements can contribute to sound
development. Officials selected by the spiritual organization's
administration will assist the judges and courts with technical points
of law, but will themselves not hold decision-making authority.
Appeal-courts will also be formed by this administration. An essential
characteristic of such an arrangement is that a judge, because of his
life outside his judgeship which he can only hold for a limited
period can be familiar with the sensibilities and environment
of the defendant. The healthy social organism will everywhere attract
social understanding to its institutions, and judicial activities will
be no exception. The execution of sentences is the responsibility of
the rights-state.
It is not possible to enter into a description of the arrangements
which would become necessary in other areas of life as the result of
implementing these suggestions. Such a description would obviously
require an almost unlimited amount of space.
The individual examples used will have shown that the exposition of
these views does not constitute an attempt to revive the three estates
food producers, military, and scholastics as some have
mistakenly assumed upon hearing my lectures on the subject. The
opposite of such a structure is intended. Human beings will not be
segregated into classes or estates; the social organism itself will be
appropriately formed. Through this formation man will be able to be
truly man. The formation will enable him to participate in all three
social sectors. He will have a professional interest in the sector
which includes his occupation; and he will have vital connections with
the others, necessitated by the nature of their institutions. The
external social organism which forms the foundation for human life
will be tripartite; each individual will constitute a binding element
for its three sectors.
Last Modified: 02-Nov-2024
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