Modern Economic Problems - Economics Vol. II | Page 3

the old solution ceased to be
satisfactory.
In large part our political history is but the reflection of the economic
motives and economic changes in the national life. Thus the American
Revolution arose out of resistance to England's trade regulations,
commercial restrictions, and attempted taxation of the colonies. The
War of 1812 was brought on by interference with American commerce
on the high seas. The Mexican War was the result of the colonization of
Texan territory by American settlers and the desire of powerful
interests to extend the area of land open to slavery. The Civil War arose
more immediately out of a difference of opinion as to the rights of

states to be supreme in certain fields of legislation, but back of this
political issue was the economic problem of slave labor. Illustrations of
this kind, which may be indefinitely multiplied, do not prove that the
material, economic changes are the cause of all other changes, political,
scientific, and ethical; for in many cases the economic changes
themselves appear to be the results of changes of the other kinds. There
is a constant action and reaction between economic forces and other
forces and interests in human society, and the needs of economic
adjustment are constantly changing in nature.
§ 3. #Present-day problems: main subjects#. The particular economic
problems in America at this time are determined by the whole complex
economic and social situation. Two main factors in this may be
distinguished: the objective and the subjective, or the material
environment and the population composing the nation. The one is what
we have, the other is what we are, as a people. These factors are closely
related; for what we are as a people (our tastes, interests, capacities,
achievements) depends largely on what we have, and what we have
(our wealth and incomes) depends largely on what we are. We may
consider the following phases; the first two of the objective factor, and
the last two of the subjective factor.
(a) The basic material resources, consisting of the materials of the
earth's surface and the natural climatic conditions which together
provide the physical conditions necessary for human existence, and
which furnish the stuff out of which men can create new forms of
wealth.
(b) The industrial equipment, consisting of all those artificial
adaptations and improvements of the original resources by which men
fit nature better to do their will. These two (a and b) become more and
more difficult to distinguish in settled and civilized communities, and
become blended into one mass of valuable objects, the wealth of the
nation.
(c) The social system under which men live together, make use of
wealth and of their own services, and exchange economic goods.

(d) The people, considered with reference to their number, race,
intelligence, education, and moral, political, and economic capacity.
The particular economic problems which are presented to each
generation of our people are the resultant of all these factors taken
together. A change in any one of them alters to some extent the nature
of the problem. The problems change, for example, (a) with the
discovery or the exhaustion (or the increase or decrease) of any kind of
basic material resources; (b) with the multiplication or the
improvement of tools and machinery or the invention of better
industrial equipment; (c) with changes in the ideals, education, and
capacities of any portion of the people whether or not due to changes in
the race composition of the population; (d) with the increase or
decrease of the total number of people, and the consequent shift in the
relation of population to resources. Many examples of such changes
may be found in American history, and some knowledge of them is
necessary for an appreciation of the genesis and true relation of our
present-day problems.
§ 4. #Attempts to summarize the nation's wealth.# If we seek to
compare the material resources of the nation at one period in our
history with those at another period, we find that it is impossible to find
a single satisfactory expression for them. Let us examine the figures for
the (so-called) "wealth of the people of the United States",[1] as it has
been calculated by the census officials.
Average total per capita Population. "wealth." wealth.
1850 23,200,000 $7,136,000,000[a] $308 1860 31,400,000
16,160,000,000[a] 514 1870 38,600,000 24,055,000,000[a b] 624 1880
50,200,000 43,642,000,000 870 1890 62,900,000 65,037,000,000 1,036
1900 76,000,000 88,517,000,000 1,165 1904 82,500,000
107,104,000,000 1,318 1912 95,400,000 187,739,000,000 1,965
[Footnote a: Taxable only; all other figures include exempt.]
[Footnote b: Estimated on a gold basis.]

A detailed comparison of the classes of concrete things making up the
totals is possible only in the last three sets of figures (1900 to 1912),
and they are here given (omitting 000,000).
1900. 1904. 1912. 1. Real property (excepting some items below)
52,538 62,331 110,700