As seen above, Plato was the first great economic thinker of Greece.^[68] Plato, however, was primarily interested in neither economics nor politics, but in moral idealism. He is pre-eminent, even among the Socratics, for this. All his economic thought is a direct outgrowth of it, and is shot through with its influence. Yet, despite this fact, he exhibits considerable insight into some of the basal principles of economics,^[69] and his entire Republic is founded upon an essentially economic theory of society. He traces its origin to mutual need,^[70] and makes little of the innate social impulse, so prominent in Aristotle’s analysis.^[71] He is the predecessor of Aristotle, however, in opposing the social contract doctrine of the Sophists with its interpretation of law as mere convention, by a natural theory of social origins. To his thought, the very foundations of society are established in eternal justice. They are not the result of mere convention, nor altogether the work of inspired lawgivers, but a complex product of natural and artificial elements.^[72]

VALUE

Strictly speaking, Plato’s contribution to a theory of economic value and a definition of wealth is practically nil. In his discussion of just price, he merely hints at the fact of exchange value. He implies that, since goods exchange according to definite proportions, they should have a common quality capable of measurement, and that just price corresponds to this.^[73] He offers no suggestion as to the nature of this quality, except that, in stating that “the artisan knows what the value of his product is,” he seems to be thinking of labor, or cost of production, as the chief element in value.^[74]

In other passages, he insists on the doctrine taught previously by Democritus,^[75] and later by Xenophon and other philosophers, that so-called goods depend for their value upon the ability of the possessor to use them rightly.^[76] This idea is represented in modern thought especially by Ruskin.^[77] The theory is, of course, true of absolute value, and, in a sense, even of economic value, in that “all exchangeableness of a commodity depends upon the sum of capacity for its use.”^[78] It cannot be made a criterion of economic value, though the allied idea, implied by Plato and urged by Ruskin, that the innate quality of the thing, its capacity for good or harm, is a real element in economic value, is being recognized today. This is evident in the increasing hostility toward such so-called commodities as opium and intoxicating liquors. Since we have begun to define political economy in terms of human life rather than in terms of property, Ruskin’s definition of wealth is more acceptable: “the things which the nature of humanity has rendered in all ages, and must render in all ages to come ... the objects of legitimate desire.”^[79]

Plato has much to say of wealth, though he deals with it strictly from the standpoint of the moralist. We look in vain for a clear definition, or for a consistent distinction of economic wealth from other goods. His terms are p???t??, used of both material and spiritual wealth; ???ata, often interpreted literally of “useful things,” as the basis of the subjective doctrine of value discussed above; ?t?ata, “possessions,” and such words as ???s?? and ????????. His use of these terms, especially the first, is ambiguous. At times he means material goods only; again, like Ruskin, he includes every human good, intellectual and moral as well;^[80] again he means “excessive wealth.”^[81] As a result of his conception of value, he includes in material wealth all those objects that depend for their worth upon wise use and character in the possessor.^[82] Material wealth is regularly placed last by Plato, as inferior to all other goods of soul or body, a mere means, and not an end in itself,^[83] for virtue does not come from property, but property and all other goods from virtue.^[84] Material goods should be the last thing in one’s thought,^[85] and the fact that people universally put them first is the cause of many ills to state and individual alike.^[86] Wealth is not blind, if only it follows wisdom.^[87] The things usually called goods are not rightly so named, unless the possessor be just and worthy.^[88] To the base, on the other hand, they are the greatest evil.^[89] In all of this, Plato is the forerunner of Ruskin, with his characteristic assertions: “Only so much as one can use is wealth, beyond that is illth”; and “Wealth depends also on vital power in the possessor.”^[90]

Plato especially inveighs against excessive wealth and luxury.^[91] Men are urged not to lay up riches for their children, since great wealth is of no use to them or the state.^[92] The prime object of good legislation should not be, as is commonly supposed, to make the state as rich as possible,^[93] since excessive wealth and luxury decrease productive efficiency,^[94] are incompatible with the highest character or happiness, being based on both unjust acquisition (?t?s??) and unjust expenditure (??a??ata),^[95] produce degeneration in individual and nation,^[96] and are the direct cause of war^[97] and civic strife.^[98] Were it feasible, he would prefer to go back to the simpler life of earlier times, before luxury and the inordinate desire for riches had so dominated all society.^[99] Of course he realizes that such a return is impossible, but he has little hope of any other escape from the evils. He is thus led to express the belief that the fewer wants the better, a doctrine common also to Ruskin, Carlyle, and Thoreau.^[100]

However, Plato has no prejudice against moderate wealth. His sermons are directed against excessive commercialism, which puts money before the human interest,^[101] thereby causing injustice, degenerate luxury, vicious extremes of wealth and poverty, political graft, individual inefficiency, and wars both within and without the state. Though his philosophy leads to asceticism, and his attitude toward wealth seems, on the surface, to breathe this spirit, yet Plato is not an ascetic in his doctrine of wealth, as is often wrongly asserted. He describes the true attitude as that which partakes of both pleasures and pains, not shunning, but mastering them.^[102] He recognizes an assured competency to be practically a prerequisite for the development of the good life,^[103] while, on the other hand, he considers poverty to be an evil only second to excessive wealth.^[104]

To be sure, Plato’s demand for a limitation of private and national wealth, and his general negative attitude are, if interpreted rigidly, unfruitful and economically impossible.^[105] It is not business that should be curbed, but bad business.^[106] Individual or nation cannot become too prosperous, provided there is a proper distribution and a wise consumption of wealth, and Plato’s idea that great prosperity is incompatible with this goal can hardly be accepted by modern economists.

Nevertheless, there is much of abiding truth in his doctrine of wealth. Aside from the profound moral value of his main contention, we may state summarily several points in which he remarkably anticipated the thought of the more modern humanitarian economists: (1) in the fact that excessive private wealth is practically impossible without corresponding extremes of poverty, and that such a condition is a most fruitful cause of dissension in any state; (2) in the fact that extremes of wealth or poverty cause industrial inefficiency; (3) in the prevalent belief that no man can gain great wealth by just acquisition, since, even though he may have done no conscious injustice, his excessive accumulation has been due to unjust social conditions; (4) in the growing belief that expenditures of great private fortunes are not likely to be helpful either to individual or to community, but are too liable to be marked by foolish luxury and waste that saps the vitality of the nation; to Plato, such are mere drone consumers of the store (t?? ?t???? ??a??t??, ... ??f??);^[107] in this, he was a forerunner of Ruskin, who opposed the old popular fallacy that the expenditures of the wealthy, of whatever nature, benefit the poor;^[108] (5) in the dominant note in economic thought today, so emphasized by Plato and Ruskin, that the prime goal of the science is human life at its best—as Ruskin states it, “the producing as many as possible full-breathed, bright-eyed, and happy-hearted human creatures”;^[109] (6) in the fact that the national demand for unlimited wealth is now recognized, as Plato taught, always to have been the most fruitful cause of international differences; (7) in the fact, which is receiving ever-greater recognition by modern economists and statesmen, that the innate quality of the object for good or harm must be considered in a true definition of economic wealth.^[110]

PRODUCTION

Plato seems to have had little positive interest in the problems of production. He was too much engrossed with suggesting means for limiting excessive acquisition. He was, however, quite apt in his use of illustrations from industrial life.^[111] He was also apparently the first to give a real classification of trades,^[112] as follows: furnishers of raw materials (p??t??e??? e?d??), makers of tools (???a?a), makers of vessels for conserving products (???e?a), makers of vehicles (???a), manufacturers of clothing and means of defense (p????ata), workers in fine arts (pa??????), producers of food (???a)—a fairly inclusive catalogue for that age; if commerce and the learned professions were included. But some of the classes overlap, since they follow no necessary principle of division. He divided productive arts into co-operative (s??a?t????), which provide tools for manufacture, and principal (??t?a?), which produce the objects themselves.^[113] They were further divided into productive arts (p???t??a?), which bring something new into existence, and acquisitive (?t?t??a?), which merely gain what already exists. In the latter class, he placed all commerce, science, and hunting.^[114] Plato would thus appear to exclude commerce and the learned professions from the true sphere of production. This, however, is only apparent, in so far as legitimate exchange is concerned. He clearly understood that the merchant and retailer save the time of the other workers,^[115] and that they perform a real service to the community, in that they make necessary exchange convenient and possible.^[116] He thus recognized them as producers of a time and place value, and he cannot be accused of the physiocratic error, which denied productivity to all workers except those who produce directly from natural resources.^[117] His distinction of productive and acquisitive arts can, furthermore, hardly be interpreted as intending to limit production to the material merely, though learning is relegated to the acquisitive class. Such an interpretation would be out of harmony with the whole trend of his thought.^[118] His further classification of productive agencies as creative (??e?a t?? p??e?? t?) or preventive (t?? ? p?s?e??)^[119] substantiates this, for many of the preventive agencies are intellectual and scientific.

The general attitude of Plato toward economic production may be inferred from his insistence upon the thorough application of the division of labor for the perfection of industry.^[120] He evidently recognized it as the necessary basis of all higher life. We have seen above, also that one of his chief objections to excessive wealth or poverty was the fact that they caused inefficiency in production.

Agriculture.—Of the three factors that enter into production—land, labor, and capital—the most important in the mind of the Greek thinkers was land. The relative prominence of agriculture was partly the cause of this, but in the case of the philosophers, their ethical passion, their idea of the necessity of leisure for personal development, and their conservative attitude toward industry and commerce were the chief motives that impelled them to urge their contemporaries back to the simple life of the farm.^[121] The aristocratic feeling, still strong in European countries, that landed property is the most respectable, probably also had some influence, though land was not so distinctively in the hands of the upper classes in Attica.

Though the praise of agriculture was a characteristic feature of Greek literature in all periods, it was not at first a conscious economic theory.^[122] Later, toward the end of the fifth century, it became a definite ethico-economic doctrine of the philosophers, as a criticism of their times, and as an appeal to what was deemed to be the more healthful life of the earlier days.

Plato does not devote so much attention to this theme as do Xenophon and Aristotle. His standpoint, however, is practically the same, though his tendency toward the physiocratic error is not so marked. In his second state, he orders that agriculture shall be the only means of money-making,^[123] and he even strikes the modern note of conservation, in his directions for the care of land, waters, springs, and forests.^[124] On this point, he and the other Greek thinkers accord well with the economy of the past decade with its urgent preachment, “Back to the land,” though the modern watchword has, of course, a more economic emphasis.

Capital.—Though the function of capital, aside from natural resources, was a familiar fact in the Athenian life of the fifth and fourth centuries B.C.,^[125] there is scarcely any consideration of it by the theorists before Aristotle. Plato has no definition of capital, nor indeed scarcely any recognition of the fact of its existence.^[126] His emphasis on the virtue of economy, however, and his criticism of those who spend the “stored wealth,” imply the idea that wealth should be used not merely for enjoyment, but also for productive purposes.^[127] His strictures upon interest show that he has but slight appreciation of the productive function of money-capital.^[128]

Labor and industry.—On the other hand, Plato has considerable insight into the rÔle of labor in production. To be sure, he shares with the other philosophers a certain prejudice against manual labor as degrading to freemen.^[129] The mechanical arts call forth reproach.^[130] Free citizens should not be burdened with such ignoble occupations,^[131] and any person who disobeys this rule shall lose his civic rights until he gives up his trade.^[132] Agriculture alone shall be open to them, and only so much of this as will not cause them to neglect their higher welfare.^[133] However, this prejudice has been read into some passages in Plato by a forced interpretation. The assertion of Socrates,^[134] that craftsmen have not temperance (s?f??s???), since they do other people’s business, is made merely to draw Critias into the argument. The statement that all arts having for their function provision for the body are slavish,^[135] does not necessarily imply prejudice against physical labor. Such arts are slavish, to Plato, because they have no definite principle of service as gymnastics has. He is merely illustrating the point that it is an inferior type of statesmanship that works without a definite principle for the highest political welfare. The idea, expressed in the Politics,^[136] that the masses (p?????) cannot acquire political science is a criticism against unprepared statesmanship rather than against labor. Indeed, Plato asserts the same of the wealthy.^[137]

Moreover, the following facts should be observed: that the prejudice of Plato against the manual arts is chiefly limited to the Laws; that even there his prejudice is primarily against retail trade rather than against industry;^[138] that in so far as a real hostility exists, its true source is not in any opposition to labor or industry per se, but rather in the political belief that only as citizens have leisure for politics can prepared statesmen take the place of superficial politicians,^[139] and in the moral feeling that constant devotion merely to the physical necessities of life causes men to neglect the primary purpose of their existence.^[140]

Modern scholars have usually been extreme in their interpretation of Plato on this point.^[141] Such unwarranted generalizations as the following are common: “Il ne dÉcouvre dans les professions qui tendent au lucre qu’Égoisme, bassesse d’esprit, dÉgradation des sentiments.” “Platon et Aristote voient dans le commerce et dans l’industrie deux plaies de la sociÉtÉ; ils voudraient les extirper À’fond, si cela Était possible.”^[142] One of the worst misinterpretations has been perpetrated by Roscher, in inferring from the Republic (372 ff.) that Plato “das Leben der Gewerbetreibenden als ein Leben thierischen Behaglichkeit schildert, sie wohl mit Schweinen vergleicht.”^[143] Such absurdities are unfortunately not rare, though they might be avoided by a careful reading, even in a translation.^[144]

It should not be overlooked either that Plato’s utterances on labor are by no means all negative. Skilled labor is recognized in several of the minor dialogues as fulfilling an actual need in civilization. Laborers are represented as having their part in knowledge and virtue,^[145] and are admitted to be the necessary foundation of all human well-being.^[146] A positive interest is also manifested by Plato in labor and the proper development of the arts in both the Republic and the Laws. He constantly harps on the necessity of each doing his fitting work, and doing it well, and in his opinion happiness consists in this rather than in idleness.^[147] Indeed, that each one perform well the task for which nature has fitted him is the definition of justice itself.^[148] The indolent rich man is a parasite and a drone, a disease of the state. This is Plato’s favorite figure in both the Republic and the Laws, a figure that is suggestive of Hesiod, the pioneer champion of labor.^[149] He is even ready to admit that it is, after all, not the kind of labor but the character of the workman that ennobles or degrades any work.^[150] In fine, his attitude toward the mechanical arts is similar to that of Ruskin, who also thinks that manual labor is degrading.^[151] But as with Plato, the chief secret of his prejudice lies in the fact that laborers usually do their work mechanically, without thought. He believes that “workmen ought often to be thinking, and thinkers ought often to be working.” He is willing to classify all work as liberal on this basis, the only distinction being the amount of skill required.^[152] However, in agreement with Plato’s idea, he would set the roughest and least intellectual to the roughest work, and this he thinks to be “the best of charities” to them.^[153] With Plato, he is also convinced that, under actual conditions of labor, the degradation is very difficult to avoid, and therefore he would emphasize chiefly agricultural labor, where education of head and hand are more fully realized.^[154]

It is, however, in Plato’s constant insistence upon the principle of the division of labor, as a prerequisite for any success in the mechanical arts or elsewhere, that he reveals insight into, and interest in, productive labor. This is the basal idea in the Republic. It is also one of the chief regulations in the Laws, where its direct application to the artisan is a clear evidence that he appreciates the economic significance of the principle.^[155] To him, it is the foundation of all human development. Society finds its source in mutual need (? ?et??a ??e?a). Man is not self-sufficient (a?t?????). Reciprocity is necessary even in the most primitive state.^[156] Out of this necessary dependence arises the division of labor, a beneficent law, “since the product is larger, better, and more easily produced, whenever one man gives up all other business, and does one thing fitting to his nature, and at the opportune time.”^[157]

The basis of this law Plato finds in the fact of the diversity of natures, which fits men for different tasks.^[158] In this he differs from Adam Smith, who believes that the differences of natural talents in men are much less than is generally supposed. Smith makes the propensity to barter the source of specialization, which, in turn, is based on the interdependence of men. He thus considers the diversities in human nature to be the effect rather than the cause of the division of labor.^[159] Plato, however, is probably nearer the truth, since the very reason for mutual interdependence is diversity of nature.^[160]

The advantages of specialization, according to Plato,^[161] are four, as stated above. It enables one to accomplish more work with greater ease, more skilfully, and at the proper season. The second and fourth of these are not mentioned by Adam Smith, but he notes the resulting increase in opulence for all the people, and the development of inventive genius. He also observes that the division of labor causes the growth of capital, and that this in turn increases specialization.^[162] Of course Plato could not appreciate the important fact of the influence of the division of labor on the development of inventive genius, since he lived before the age of machinery.

Plato is also a forerunner of Adam Smith in his recognition of the fact that the division of labor depends for its advance upon a great increase in the size and complexity of the state.^[163] It means a multiplication of trades, a development of industry,^[164] the entrance of the retail trader (??p????),^[165] and the invention of money as a means of exchange.^[166] The necessity of the division of labor between states is also recognized. It is impossible to establish a city where it will not be in need of imports (?pe?sa??????). International trade therefore arises, and with it are born the merchant (?p????) and the sailor class, together with all those who are engaged in the labor of the carrying trade.^[167] Thus Plato, the idealist, and reputed enemy of trade and industry, develops them directly out of the basal principle of his Republic. He appreciates the necessity of a full-fledged industry and commerce to the existence even of a primitive state, and his hostility to them is actually directed only against what he terms their unnatural use.^[168] Moreover, in his opinion, one function of the division of labor should be to limit them to the performance of their proper tasks, and keep them from degenerating into mere money-making devices. It should also result in limiting such vocations to the less capable classes since the rulers should be artisans of freedom.^[169]

It would take us too far afield to discuss the diverse ways in which Plato uses his principle. We may observe in passing, however, that he applies it to war, in his interesting criticism of the citizen-soldier;^[170] to the finer arts, even when they are quite similar to each other;^[171] to politics, as noted above; to justice and the moral life in general;^[172] and to the intellectual life, in his unsparing criticism of the superficial versatility and dilettantism of the contemporary Athenian democracy, which trusts the government to any incompetent, professes to be able to imitate everything, and makes the many-sided Sophist (p???ap????) the man of the hour.^[173] Though he begins with the development of the principle as an economic fact, his primary interest in it is as a moral and intellectual maxim. The fact that the cobbler sticks to his last is only a symbol (e?d????) of justice.^[174] Nevertheless Plato does appreciate to a remarkable degree the economic bearings of the law, and his discussion of it is notably scientific and complete.^[175] He sometimes pushes its application to an extreme, though such instances are perhaps meant in a playful Socratic vein.^[176] At least, like Ruskin, he understands that extreme specialization must produce narrow and one-sided men, and that progress revolts against its too rigid application.^[177] He is aware too that the division of labor breaks down in the case of the poor unemployed of the state, since they have no special work.^[178]

SLAVERY

Plato is not blind to the ethical aspects of the problem of slavery. In his first healthy state (???e???), slavery and war are conspicuously absent, and it is the natural inference that the author believed these to be necessary evils of the more complex state.^[179] He appreciates the dangers of absolute power, even in private life, and believes that few men can stand the strain.^[180] He conceives human nature as a unity that defies absolute division into separate classes.^[181] Though he does not renounce slavery in the Republic, he would limit, it to the barbarians and to those who seem unfit for the higher life.^[182] It plays a remarkably small part in his first state, and it would seem that his idealism is here struggling against what he feels to be an economic necessity. In the Laws, he frankly accepts the necessity, and puts even agriculture, as well as the other industries, into the hands of slaves.^[183] However, they are not to be treated as animals, but as rational men, in whom a proper usage may develop a certain degree of morality and ambition for good work.^[184] To be sure, his purpose is economic rather than ethical—to make the slaves satisfied with their lot, and thus better producers.^[185] He makes no mention of freedom as a reward for good behavior, though he elsewhere provides for the existence of freedmen in the state, and stipulates that they shall not become richer than their former masters.^[186]

MONEY

As Plato was the first of extant Greek thinkers to grasp the principle of the division of labor, so he was the first to give any hint as to the origin of money. He states that it came into use by reason of the growth of necessary exchange, which in turn resulted from increased division of labor.^[187]

The function of money he defines somewhat indefinitely by the term “token of exchange,”^[188] an expression suggestive of Ruskin’s definition “a ticket or token of right to goods.”^[189] It seems to imply that money is not itself a commodity to be trafficked in. In the Laws, he specifies more clearly the functions of this symbol. It acts as a medium of exchange and as a measure of value.^[190] The latter office is performed by reason of the fact that money is a common denominator of value, changing products from incommensurable (?s?et???) and uneven (???a???) to commensurable and even.^[191]

Since Plato did not consider money to be a commodity to be bought and sold, and since he did not appreciate its productive function as representative capital, his theory of interest was superficial. His attitude toward it was somewhat similar to that of many people today toward speculation in futures in the stock market, as a practice contrary to public interest and policy. The application of the term t???? to interest by Plato^[192] and Aristotle, as though interest were the direct child of money, is probably only a punning etymology, and not intended seriously. It can therefore hardly be used, as it often is, to prove the superficiality of the theory of the Socratics. Plato, however, would have no money-making by usury,^[193] nor indeed any loaning or credit at all, except as an act of friendship.^[194] Such contracts should be made at the loaner’s own risk,^[195] and held legal only as a punishment for breaking other contracts.^[196] He calls the usurer a bee that inserts his sting, money, into his victims, thereby beggaring them and enriching himself.^[197]

Such strictures against interest were common in mediaeval Europe, reappeared in Ruskin,^[198] and are implied in the present opposition, in some quarters, to so-called “unearned income.”^[199] The motive in mediaeval times, however, was distinctively religious, and was also partly due to the absence of a developed capitalism. With Ruskin and modern theorists, on the other hand, the objection is, at bottom, socialistic. The motive of the Socratics was essentially moral and political.

Plato’s other error concerning money, as above observed, was that it need possess no intrinsic value for domestic use. He looked upon gold and silver as causes of degeneration in state and individual,^[200] and would therefore have put a ban on them for use within the state.^[201] To his mind, a mere state fiat was sufficient to give currency and value.^[202] This doctrine has also often recurred in the history of economic thought, as in Ruskin and the Greenback party of a generation ago.^[203] The error, however, was not so grave in Plato’s case, for he, at least, recognized the need of the precious metals for international purposes.^[204] Moreover, in his proposed state of such limited extent, the problem would have been far simpler, and he would have distinguished between actual conditions and possibilities in Greece and his admittedly more or less utopian ideal.

EXCHANGE

Exchange in Greek economy held a very minor place, compared with its dominant importance in modern theory. It was discussed chiefly in a negative manner, as the object of the moral and aristocratic prejudice of Greek thinkers. We find, however, some appreciation of its true place in the economic life of a state. Plato divides trade, ???a?? or ????ast???, into a?t?p?????, which sells its own products, a?t??????, and eta??t???, which exchanges the products of others. He further divides the latter into ?ap?????, the exchange within the state, which he calls one-half of all the exchange, and ?p?????, foreign commerce.^[205] He finds its origin in the division of labor, and in the mutual interdependence of men and states.^[206] He understands the necessity of the reciprocal attitude in international, as well as in private, exchange, and thus has a clearer insight than the mercantilists and some modern statesmen. A state must raise a surplus of its own products, so as to supply the other state from which it expects to have its own needs satisfied.^[207]

Since a tariff on imports played little part in Greek life, except in so far as it was imposed for sumptuary or war purposes,^[208] the perplexing modern problem of the protective tariff scarcely came within the horizon of Greek thinkers. Plato would prohibit the import of certain luxuries, as a moral safeguard. He divides merchandise into primary and secondary products, and would not permit the import of the latter.^[209] Elsewhere, however, he legislates against imposts upon either imports or exports, though unconscious of the significance of his suggestion.^[210]

He appreciated something of the function of exchange in society. It performed a very important service, as a mediator between producer and consumer.^[211] Like money, it served to equalize values, and thus acted as an aid to the satisfaction of needs.^[212] When limited to this primary function, it was of advantage to both parties to the exchange,^[213] and merchants and retailers had then a real part in the production of values.^[214]

The sweeping assertion is too often made that the Greek people were hostile to trade, and therefore that their theorists were especially opposed to it. We have already seen how false this idea is for the Greeks themselves,^[215] but it also needs a great deal of qualification in the case of their writers. Their hostility is directed especially against the more petty business of retail trade (?ap?????) rather than against the extensive operations of the merchant (?p????). But their opposition even to this is not entirely undiscriminating. We have seen that Plato clearly understands the necessity of exchange to the life of the state.^[216] He admits that even retail trade is not necessarily evil.^[217] The chief reason why it appears so is because it gives free opportunity for the vulgar greed of unlimited gain, which is innate in man.^[218] If the noblest citizens, who are governed by rational interests, should become retailers and innkeepers, the business would soon be held in honor.^[219]

Plato, however, would limit exchange to its primary function as defined above.^[220] Like Ruskin, he believes that, whenever it is pursued merely for private gain, it becomes a source of degeneration to individual and state. It is then akin to the fraudulent or counterfeit pursuits (??d?????).^[221] The retailers in well-ordered states are generally the weakest men, who are unable to undertake other work.^[222] The rulers in the Republic must keep themselves entirely free from the trammels of trade, lest they become wolves instead of shepherds,^[223] though Plato is grappling here with a very real problem that still faces us—how to prevent graft among public servants.^[224] In the Laws, retail trade is entirely prohibited to citizens,^[225] and permitted only to metics and strangers,^[226] and, indeed, only to those whose corruption will be of least injury to the state.^[227] These aliens are not to be permitted to gain overmuch wealth,^[228] and they must depart from the state, after twenty years’ residence, with all their belongings.^[229] Retail trade, even in their hands, must be strictly limited to the demands of the state,^[230] and confined to the market-place for the sake of publicity.^[231] All exchange must be honest, dealing with unadulterated products (???d????).^[232] There shall be no dickering over sales, but only one price shall be set upon goods each day. If this is not accepted, the goods must be removed from sale until the following day.^[233] If possible, the executors of the laws should try to fix a just schedule of prices, to allow of moderate gain, and should see that this is observed by the retailers.^[234] As a climax to all these precautions, Plato would have the rulers take pains to devise means whereby the retailers shall not degenerate into unbridled shamelessness and meanness of soul.^[235] Under such limitations, he has faint hopes that retail trade may be freed of its stigma, so as to do least harm to those who pursue it, and to benefit the whole state.^[236]

It need not be observed that this attitude of Plato toward trade and commerce is alien to the spirit of economic progress, and that no advanced civilization could be developed on such a basis. His profuse legislation, too, as above outlined, strikes a modern as naÏve and visionary.^[237] No man, however, is more aware of this than Plato himself. He should be judged, not in a spirit of rigid literalism, but with a sympathetic criticism which tries to understand the psychological reasons for his attitude. His suggestions are not offered as a proposed scheme for actual legislation,^[238] but rather in the spirit of the moralist, who, observing that almost inevitable evils accompany retail trade and commercialism, with human nature as it is, and that commerce, the servant of man, has become his master, sees almost the only hope of escape in its limitation to what is barely necessary. The age-long problem of a greedy commercialism, which is blind to the appeal of all other goods when profits are at stake, Plato certainly saw clearly, and outlined with the hand of a master. The problem faces us still, in a form even more acute, but the protests of Plato, Ruskin, and Carlyle are bearing positive fruit today, in a political economy that takes as its supreme goal human life at its best.

But aside from these generalities, a sympathetic study of Plato’s thought on exchange reveals an insight into certain specific points, of interest to modern economics, which are commonly overlooked. His protest against the former axiom of economics, that the prime purpose of trade is profit, and that the mere fact that goods change hands, necessarily increases the wealth of a country, is substantially correct.^[239] Commerce for commerce’ sake is a clear case of mistaking the means for the end, and is contrary to sound economics as well as ethics. The objections of Plato and Ruskin^[240] against the principle too generally accepted by business and economy of the past, at least tacitly, that “it is the buyer’s function to cheapen and the seller’s to cheat,” are being recognized today as worthy of consideration.

The anxiety of Plato over the effect of trades or professions upon character is well worthy of modern imitation, and this is, to a considerable extent, an economic as well as a moral question. Zimmern^[241] has well observed: “Our neglect to study the effect of certain modern professions upon character, when we are always insisting, and rightly, upon the importance of a character-forming education, is one of the strangest lapses, due to the sway of nineteenth-century economics.”

As we have seen, one of the chief purposes of Plato in his limitation of commerce was to eliminate graft from the government. Though his remedy was not acceptable, yet his remarkable appreciation of a very grave problem that still faces us should be recognized. Furthermore, no better solution for it has ever been offered than the separation of politics from big business. This was the underlying principle of his suggestion, and it is in accord with the trend of modern statesmanship.

Another impelling motive of Plato in his stringent legislation was to render impossible the development of extremes of wealth or poverty in the state. Again, we should credit him with having clearly appreciated the problem, though we may criticize his attempted solution. The great commercial prosperity of today has made the situation vastly more acute, and still economics has no satisfactory solution to offer. After all, in the light of modern tendencies toward the regulation of industry and commerce, some of Plato’s ideas do not seem so “grandfatherly,” but rather prophetic, and in accord with sound economy. His legislation against the sale of adulterated products,^[242] and in favor of publicity in business,^[243] and state supervision of prices^[244] has a startlingly modern ring.

POPULATION

The problem of population and food supply, which disturbed Malthus and some of the other English economists, was also a cause of concern to Greek thinkers. This might well be expected, since it is a recognized fact that the source of the grain supply was always a matter of grave concern to Athens and many other Greek cities.^[245] Plato states the problem clearly and hints at a solution, when he says that the natural increase of population in his state shall not exceed the economic basis for it.^[246] In the Laws, he suggests specific means for preserving the proper number by restraining over-productive people, and by encouraging the opposite.^[247] If such general provisions should not prove sufficient, he would then resort to colonization.^[248] On the other hand, should population be greatly depleted by war or disease, he would even open the doors of citizenship to the undesirable classes.^[249] His interest in the problem of population, however, is primarily moral and social rather than economic. Moreover, in antithesis to Malthus, he limits his consideration to a very small, artificially constructed state. With the narrow political vision of a Greek, he thinks that the production of a multitude of “happy-hearted” men in a state is impossible.^[250]

DISTRIBUTION

As stated in the Introduction, the economic interest of Greek thinkers was particularly alive in the fields of distribution and consumption. It is here that they are especially interesting and suggestive.^[251] However, they dealt very little with the important principles of distribution as laid down by modern economists. Theories of the several elements that enter into distribution—wages, profits, and rent—are for the most part conspicuously absent.^[252]

The problem of distribution is also hardly considered from the modern standpoint. We look in vain for a treatment of the modern dominant question of the relation between capital and labor. Moreover, the Greek theories of distribution are, on the whole, not the outgrowth of the sentiment of human sympathy for the poor and the common laborer, which is so prevalent today. The purpose seems to be to guard against dishonesty rather than oppression from either contracting party.^[253] This lack in Greek theory is not strange, in an age when slaves took the place of machinery, so that capital and labor were largely united in them, while the majority of free laborers worked directly for the public, or on the land.^[254] The goal of the theorists, therefore, is the conservation of the state rather than the relief of any class of the citizenship.

Plato discusses the importance of a proper distribution of wealth in the Republic, but the point that looms large to him is the fact that excessive wealth or poverty is likely to endanger the stability of the state.^[255] As seen above, also, some of his regulations in the Laws seem to strike a modern note. He would have a state commission fix prices,^[256] would permit the state to limit the freedom of inheritance,^[257] and perhaps even intervene in securing a just wage.^[258] Yet in all of this, the dominant motive is to avoid civic discord.

Before proceeding to the larger subject in distribution, Plato’s theory of private property, we will discuss briefly his attitude toward the laboring classes.^[259] It is commonly asserted that the Greek philosophers had little or no regard for the masses. As usually expressed, however, the statement is very unfair, and especially to Plato. Such extreme assertions as the following are frequent: “They [the masses] are of no account altogether.”^[260] Plato in the Republic “voue À l’ignominie, au mÉpris, À la misÈre, À la servitude Éternelle la classe des ouvriers.”^[261] “FÜr die des Erwerb obliegenden Personen bedarf es keiner Erziehung.”^[262] “Plato, in treating of the ideal state, deems it not worth while to concern himself with the trading and artisan classes.”^[263] “Und im Übrigen will er sie [the masses], wie es scheint, durchaus sich selbst Überlassen.”^[264]

To be sure, as above admitted, the interest of Greek thinkers was not marked by the modern sentiment of sympathy for the laborer. Their writings are characterized by a certain aristocratic feeling, and they do not emphasize the worth or importance of the masses. Yet they are far from being indifferent or hostile to them.

Aristotle himself was the first to make this false criticism of Plato.^[265] But the author of the Republic foresaw that he might be misinterpreted, and excused himself for his indefiniteness in the details of the ideal state.^[266] Moreover, Aristotle’s criticism is not borne out by a study of the Republic. Plato implies with sufficient clearness that his communistic regulations are limited to the two upper classes.^[267] It is not true either, as Aristotle asserts,^[268] that there is a rigid caste system in the Republic. The very opposite principle is laid down.^[269] The myth of the three metals presents an aristocracy based strictly on intellectual and moral excellence. No arbitrary obstacle hinders either the degradation or the rise of any individual from his class. It depends entirely upon the possession of the gold of character and mentality, for which all may strive. Moreover, the life of the so-called first caste is literally dedicated to the best service of the rest. If this be aristocracy, we cannot have too much of it.^[270]

Neither is Aristotle’s criticism warranted, that Plato makes the happiness of the whole state something different from the sum of its parts.^[271] He merely states the principle, universally true, that no class has a right to expect to be happy at the expense of the whole state, and that, in the long run, the prosperity of each is bound up in the prosperity of all. Indeed, he puts the very objections of Aristotle and Grote into the mouth of Adeimantus, and answers them satisfactorily, in his illustration of the painted statue.^[272] There could hardly be a better example of Plato’s lofty ideal, that each part is to contribute its share toward the utility, beauty, and happiness of the whole, and that through this cooperation each realizes the highest quantum of happiness for himself. This doctrine of mutual interdependence is the basal principle of Christianity, taught by Jesus and Paul in a strikingly similar figure of the body and its members,^[273] though naturally Plato’s idea of brotherhood is narrower in scope.

The common assertion that Plato has no regard for the artisan class, then, is unwarranted.^[274] The entire Republic is built upon the opposite principle, to prevent exploitation of the lower by the upper classes; and his comparison of good and evil rulers to shepherd dogs and wolves^[275] is a precursor of the famous passages of Milton and Ruskin on the same theme. All classes of citizens in the state are brothers.^[276] The rulers are saviors (s?t??a?), allies, shepherds (p??e?e?), nurses (t??f?a?), paymasters, and friends.^[277] This happy unity (?????a), or harmony (??f???a), of all classes is to Plato the highest goal toward which the true statesman should strive,^[278] and the point of next highest importance to the communism of the guards is the proper regulation of wealth and poverty for the artisans.^[279] The mere fact that he does not believe the artisans to be capable of political independence by no means indicates that he is indifferent to their social or economic welfare. It is to conserve this that he would put the government into the hands of the most capable,^[280] and, in any event, the artisans are not to be held in subjection so much by external force as by their own free self-restraint.^[281] This, in itself, is sufficient evidence that Plato intended to include the third class in his lower scheme of education, a fact borne out also by other passages.^[282]

It must be admitted that a somewhat different spirit pervades the Laws, where he seems to have despaired of the lofty ideal of the Republic. He relegates the working classes to non-citizenship. But here, also, he is still anxious that they shall have the sort of education that befits their station,^[283] and that justice be done them.^[284] He also provides against the existence of beggary in the state.^[285] Whatever may be said of his aristocratic spirit, therefore, he cannot be justly accused of the gross indifference of the early nineteenth-century economy and of modern capitalism toward either masses or public, in their concern for material wealth.^[286]

The Greek theory of distribution was employed chiefly in the criticism of the institution of private property, and in the suggestion of more or less communistic systems to succeed it. This tendency, however, was not like the modern either in motive or in general type. Modern socialism aims to be scientific, and professes to build a scientific system on a basis of economic laws. Greek socialism had no such aim. It did not lay claim to any relation to economic law, but frankly presented itself for what it was, a politico-moral sentiment. Other points of distinction will be observed as we proceed, but this primary one must not be overlooked, if either the spirit or the meaning of the Greek social theory is to be understood.

Two considerations made the communistic sentiment a normal one to the Greek democrat. (a) The institution of private property had not become so thoroughly imbedded in the very foundations of society as it has today. The custom of family tenure was not entirely forgotten, and in some backlying districts may well have been still in vogue.^[287] In some states, also, a part of the land was probably still held in common by the citizenship. The frequent establishment of cleruchies in conquered territories, in which the land was regularly assigned by lot, and the ever-recurring revolutions, which usually resulted in confiscation of the land in favor of the victorious party, must have assisted materially in unsettling the confidence of the Greeks in private property as a basal institution of society. The actual existence of a polity like that of Sparta, where private ownership does not seem to have been so absolute,^[288] doubtless also exerted its influence on the imagination of Greek thinkers. (b) As is generally recognized, the Greek, far more than the modern, took for granted the subordination of the individual citizen to the state. We have also seen that he tended to magnify the power of legislation as sufficient to encompass any reform, even in the face of economic laws. To him, therefore, the demand that the state be made the dispenser of private property did not seem unnatural.^[289] We should be on our guard, however, against exaggerating the extent of this sentiment among the Greek writers, or against reading into them the modern socialistic doctrines.

A consideration of the predecessors of Plato in social speculation may be conveniently introduced at this point, before we proceed to the discussion of the Republic. Some have thought to find traces of communism in Homer. The evidence of any real communism, however, is very slight, and the frankly individualistic spirit of the poems is against it. Moreover, this is a problem that concerns the economic conditions rather than the theory.^[290] Little is definitely known of Pythagoras and his school, but it is improbable that he either taught or practiced a real communism.^[291]

As for Hippodamas of Miletus, it is difficult to gain a clear idea of his ideal state from Aristotle’s meager description,^[292] but it seems not to have been markedly socialistic. He divides his body of ten thousand citizens into artisans, farmers, and soldiers.^[293] He makes a corresponding triple division of the land—sacred, to provide for the expense of worship; public, for the support of the soldiers; private, to be owned and worked by the husbandmen.^[294] Thus only the farmers are to own land, and the question as to who shall work the land for the military class is left in obscurity.^[295] It seems likely that Hippodamas intended that the farmers should work all the land, and own one-third of it for their own support. His system contains some communistic elements, as the fact that two-thirds of the land is public, but it is certainly not socialistic in spirit and purpose. The prime interest of Hippodamas was very probably not in a system to supplant private property, but rather in a plan of assured support for the priestly and military classes.^[296]

Phaleas of Chalcedon, according to Aristotle’s description, approaches much nearer to the modern socialistic idea.^[297] Aristotle makes him a type of those thinkers who lay chief stress on the right system of property as the necessary basis of civic peace.^[298] His central tenet is equality of possessions and of education for all the citizens,^[299] but he seems to have specified only landed property.^[300] This demand, though only landed property is included, seems to strike a truly modern socialistic note. But nowhere better than here may we see the gulf that separates ancient and modern socialism. The avowed interest of Phaleas is not in the masses. The artisans are all to be public slaves.^[301] His interest is rather in the classes, and not even in these primarily, but rather in the state itself. His entire system has for its fundamental motive the avoiding of civic discord in the state.^[302]

The ideal state of Plato’s Republic has often been presented by socialists and other modern writers as the great prototype of all socialistic doctrine. We must consider to what extent such a view is justified. In his famous myth of the three metals, Plato divides his citizens into three classes—rulers, auxiliaries, and farmers and artisans.^[303] His avowed purpose here, as indeed throughout his Republic, is to secure the highest degree of happiness for all the citizens.^[304] In order to gain this end, he provides for a most thoroughgoing system of communism, including all property, both for production and for consumption, except such as is necessary for the immediate need.^[305] He extends it even to the common possession of wives and children,^[306] that all private interests may be reduced to a minimum.^[307] He provides further for a common work^[308] and education^[309] for men and women.

Such, in brief, is the system proposed in the Republic.^[310] Superficially considered, it would seem to be the parent of modern socialism and communism. There is, however, actually but slight similarity between them. The so-called communism of Plato extends only to the first two classes, which can include but a small minority of the citizenship.^[311] Thus the masses, with whom modern socialism is especially concerned, are not directly touched by his system. Again, the primary motive of Plato’s communism is not the modern motive at all. His thought is not to secure a just share for all in the products of industry. Though he recognizes the importance of providing against the evils of extremes of wealth and poverty,^[312] the motive is not the material interest of any class. It is an intense desire for unity and for escape from civic strife in the state,^[313] for provision against graft, corruption, and tyranny in the rulers,^[314] and for insuring as efficient work as possible.^[315] Like Ruskin, Plato is no democrat. Equality is not in his thought.^[316] Unlike many a modern socialist, he realizes that absolute arithmetical equality is impossible, and that if gained it would be the greatest injustice. He knows that the true equality must be proportional, demanding not that each receive exactly the same, but that each receive his due.^[317] His third class, comprising a large majority of the citizens, is practically without political activity, a fact in marked contrast to the modern social-democratic spirit. His emphasis is not economic and material, as is that of modern socialism, but political and moral.^[318]

In fine, the Republic contains some socialistic elements. Plato’s restriction of the freedom of the individual so as to subserve the interest of the whole,^[319] his tendency to magnify the power of law in the face of economic principles and of human nature,^[320] his interest in the welfare of the common people, his declaration against inequality of fortune, his denial of the right of private property for the upper classes, and his proposed community of wives and children, a measure too radical for the better type of modern socialism,^[321] all seem socialistic in trend.

The tendency to magnify the power of law, and the submission of individual to state interest, however, were characteristics of Greek civilization, and not distinctly Platonic or socialistic. His interest in the welfare of the masses, as we have seen, was not primarily economic, but had for its ulterior motive the preservation of the peace of the state. His denial of private property and family interests to the guards, and his opposition to extreme wealth or poverty were, as seen above, devoid of socialistic motive. Moreover, in his hostility to retail trade, he was not moved by the modern socialistic demand for immediate contact between producer and consumer. The conditions that called forth such a demand were not then in existence,^[322] as is also true of the modern agitation for a proper distribution of the profits of industry. Above all, Plato made no pretense to any economic basis for his communism, but presented it as a moral and political ideal. The Republic cannot therefore be classified as truly socialistic either in motive or in general plan.^[323]

In any event, there is nothing in common between the high moral idealism of Plato’s so-called communism and the crass materialistic communism that is the subject of Aristophanes’ satire in the Ecclesiazusae. Dietzel^[324] has well pointed out that the latter is extremely individualistic, atheistic, and immoral, demanding all from the state with no return; that the Republic, on the other hand, demands the loftiest morality and renunciation, and is a direct protest against such tendencies in Athens as are attacked by the comic poet. As he shows, the two are as far apart as are the watchwords, “All for self,” and “All for all.”

Plato’s idea that society is the exact counterpart of the individual in the large, however, is quite analogous to the modern comparison of society to an organism.^[325] Both are wrong in attempting to press the analogy too far, yet they contain a truth of profound importance, which is at the foundation of the marked change in the spirit of economics in recent years. It is the notion of solidarity, which demands that the individual shall no longer seek the content of his being in himself alone, but also in the conditions that shall produce the highest life for the commonwealth.

In the Laws, Plato reluctantly abandons some of the utopian suggestions of the Republic for a more practical legislation,^[326] though his ideal is really unchanged. Communism of property and of the family are both discarded even for the rulers, as feasible only for a supernatural order of beings.^[327] As a noble ideal, however, it still hovers before him.^[328] Private property is permitted to the citizens,^[329] but under protest, and if practicable, Plato would like to prohibit it, as the primary root of all social disturbance and corruption.^[330] He would advocate, therefore, a return to the old rÉgime of family tenure, somewhat on the model of the Spartan system.^[331] He would also hamper this by limitations so as to make it no real ownership at all. The land is to be practically state property, over which the citizens exercise merely the right of use.^[332] It is to be divided into lots of equal value, corresponding exactly to the number of citizens.^[333] Natural disadvantages shall be compensated for by an increase in the size of the lot, and part of each allotment shall be near, and part at a distance from the city, that all may be on an equal footing, and alike ready to defend against invasion.^[334] In order that no citizen may lose his lot, and no man may possess more than one, very stringent regulations are advised.^[335] No lot may be purchased or sold,^[336] confiscated,^[337] or divided by will to more than one heir,^[338] and no citizen, in any manner whatsoever, may become owner of more than one lot.^[339] The living of the other members of the family is arranged for by a provision for a general distribution of the product of the soil, in imitation of the Cretan law.^[340] The annual product of grain and cattle shall be divided into three equal parts, one for citizens, one for their servants, and one for the artisans, metics, and strangers. The first two parts shall not be subject to sale, but each head of a family shall receive from them enough to nourish his family and slaves.

It is evident from all these regulations that Plato’s citizens do not actually own their lots, but merely enjoy the usufruct of them from the state on certain conditions. He takes away with one hand what he gives with the other. Under such a system all his precautionary measures could not have prevented the growth of an even more oppressive poverty, unless the growth of population could be checked.

The regulations limiting the acquisition or possession of personal property are even more stringent, though here an absolute equality is not attempted. He seeks, however, to prevent the rise of inequality of fortunes, at the very threshold, by making undue acquisition difficult or even impossible for the citizens. All money-making occupations are practically closed to them^[341]—trade,^[342] the mechanical arts,^[343] and even agriculture, so far as their own personal work is concerned. The latter is given over to slaves,^[344] the arts and trade to aliens, with strict limitations to be enforced by the officers of the market.^[345] As seen above, two-thirds of the farm products are not to be subject to commercial dealings.^[346] The loan of money at interest is forbidden, and he who disobeys will risk the loss of both principal and interest.^[347] A bulky coinage of baser metal is provided for the daily use of private citizens, such as will not pass current in another country.^[348] No dowries are to be given or received,^[349] and there shall be no hoarding, but the entire produce of the lots must be annually distributed for consumption among the whole population of the state.^[350] To make assurance doubly sure, Plato prohibits his citizens from owning personal property above four times the value of the lot,^[351] or four minas.^[352] Any amount in excess of this must be handed over to the state on pain of severe fine for disobedience.^[353] This is to be accomplished by the regulation that all property except the lot must be publicly registered, and failure to fulfil this obligation entails the loss of all but the original lot, and public disgrace.^[354]

In all this drastic limitation of property rights, Plato’s chief motive is to render excessive wealth or poverty impossible,^[355] and to harmonize the citizenship by reducing all inequalities to a minimum.^[356] This he purposes to accomplish, not merely by the foregoing restrictions, but also by means of a common education,^[357] and by the institution of the sussitia.^[358] He makes the road to comparative equality easier than in his first state by relegating all the third class, the artisans, merchants, and farmers, outside the pale of citizenship.^[359] The actual difference, however, is not so great as it might appear. In the Republic there is equality in the upper class, while in the Laws there is comparative equality among the citizens who comprise only the upper class. In neither case is there a real equality in the whole state. Plato is well aware that only approximate equality can be attained, and that differences not only in property, but also in birth, virtue, strength, and beauty, are bound to exist.^[360] He would therefore have taxes and distributions unequal in the same ratio, so as to avoid dissatisfaction and dispute.^[361] The difficulties incident to such a scheme of legislation he would obviate by starting a new state in virgin soil.^[362]

Souchon^[363] recognizes the Plato of the Laws as a true socialist, and points to his attempt to prevent all inequality, and to his extreme state intervention as characteristic elements of socialism. Plato certainly does approach nearer to a real socialism in the Laws than in the Republic. In addition to the points noted by Souchon, there may be observed the application of the system of equality to the whole citizenship, though at the cost of shutting out all the workers; the strong sense of the social function of property;^[364] the practical denial of real private ownership of land; the demand for publicity in business, which is one of the chief suggestions for the regulation of corporations today;^[365] the active interest in the conservation of natural resources, which, while not socialistic, lies in the direction of greater social control;^[366] and the fact that distribution of the products of industry is made practically a function of the state.^[367] The demand for equality and unity is also somewhat analogous to the modern socialistic hostility to competition, which Ruskin calls the “law of death.”^[368] It may be added further that Plato’s description of the economic strife in his day is slightly suggestive of the criticism of capitalism by modern socialism.^[369] However, the basal motive of Plato is, again, not that of modern socialism. His aim is still primarily moral and political rather than material,^[370] and he exhibits less interest in the welfare of the laborers than he does in the Republic.^[371] Moreover, his demand for equality is prompted by exactly the same motive as was active in the Republic, not to ameliorate the condition of the laborer, whom he has relegated to slavery, but to avoid the hated civic discord (d??stas??) and to preserve the unity of the state.^[372] The equality too, is in no sense analogous to that sought by modern socialism, for, as seen above, it is merely equality within a class, comprising the aristocratic minority of the state, and does not touch the working masses at all.^[373] In fine then, though there are perhaps enough truly socialistic elements in the Laws to warrant the classification of Souchon, yet if Plato’s ideal were realized, it would be mainly a restoration of the old economic rÉgime in Greece, based on agriculture and the family tenure of property. Such an ideal, modern socialists would doubtless fail to recognize as having much in common with their own.^[374]