Three Economic Problems of the Age

Dominion, Volume 32, Issue 154, 25 March 1939, Page 1 (Supplement)

Three Economic Problems of the Age

WHAT are the unsolved practical economic problems of the age? I believe they are three in number,” says Dr. James A. Bowie, Principal of the School of Economics at Dundee. “First, is the trade cycle. Ever since records have been made, and certainly for over two hundred years, the existence of periodic, ebbs and flows of trade has been noted. It is a thoroughly bad condition. It has kept the industrial world on tenterhooks; the depression means loss, bankruptcy, unemployment, and fear. Much research work is still needed here both as to causes and cures. An army of 56,000 full-time investigators would be the best investment the world has ever made if it succeeded (and who can doubt that it would) in freeing man from this menace.

“Second, and closely allied to the first, is unemployment. Can any of us measure the vast amount of misery, starvation, disease, crime, bad health, and moral degradation that unemployment has caused? Are we all ostriches that‘we endure it? Is there any thinking man, much less any Christian, whose life does not become a meaner thing in its contemplation?

“Third, there is the problem of distribution. If science has solved the problems of production, nothing has been done to render efficient and indispensable channels of distribution. The enormous costs heaped on a product between the factory and the customer are a serious obstacle against raising the general standard of life.

“The issue here is not between Capitalism and Socialism; the whole controversy is today unimportant, a mere academic abstraction. The real question is not whether the State should intervene in economic activity, but in whose interest and as whose servant it should do so, and with what competency. I add that because I believe the State often fails in its intervention, not because its purpose was wrong or its regulation unneeded, but because its personnel are seldom or never trained administrators.

“The only war between Capitalism, Communism and Fascism is one of the greatest obstacles to practical treatment of our actual day-to-day problems. In the din of battle all sorts of sensible suggestions are drowned. Most wars have been fought not on practical issues, but over pure metaphysics. Man should everywhere be distrusted as soon as’he begins to generalize, and specially is this true in political, social or economic affairs. Most men talk sense only when they talk shop.

“In the great changes that are coming over the world, the open mind, the fact-finding approach, are needed as never before. “Thus we do not improve our country by building bridges over estuaries, or by conserving our industries, like jute, or by utilizing the labour of our unemployed workers. Why do we not do these things when we know them to be both necessary and capable of producing' income? The answer is that the Government possesses no system of bookkeeping to prove that such expenditures are a source, of future wealth.

“There is no royal road or short cut to economic salvation. But, as a general proposition and a basic one, I venture to assert that all social problems are a reflection of the quality of the people who create them. “Social and economic evils will be remedied only when large numbers of the people understand them in terms of causes. So, as a. first necessity, these causes must be ascertained by patient research, and the results of that research communicated to ever-widening circles through a system of education which regards life, and conduct, and human beliefs and ways of living as of first importance.

“The problems of war and unemployment, of boom and slump, are problems of human ideology. Though we may seem, in the face of immense possibilities, to be paralysed by some strange insanity, all that is really wrong with us is that our past history has’left us with a set of ideas that no longer fit the facts.”