The Concentration of Wealth

William Graham Sumner

United States, 1902

The concentration of wealth I understand to include the aggregation of wealth into large masses and its concentration under the control of a few. In this sense the concentration of wealth is indispensable to the successful execution of the tasks which devolve upon society in our time. Every task of society requires the employment of capital, and involves an economic problem in the form of the most expedient application of material means to ends. . .

There seems to be a great readiness in the public mind to take alarm at these phenomena of growth — there might rather seem to be reason for public congratulation. We want to be provided with things abundantly and cheaply; that means that we want increased economic power. All these enterprises are efforts to satisfy that want, and they promise to do it. The public seems to turn especially to the politician to preserve it from the captain of industry; but when has anybody ever seen a politician who was a match for a captain of industry? One of the latest phenomena is a competition of the legislatures of several states for the profit of granting acts of incorporation; this competition consists, of course, in granting greater and greater powers and exacting less and less responsibility.

It is not my duty in this place to make a judicial statement of the good and ill of the facts I mention — I leave to others to suggest the limitations and safeguards which are required. It is enough to say here that of course all power is liable to abuse; if anybody is dreaming about a millennial state of society in which all energy will be free, yet fully controlled by paradisaic virtue, argument with him is vain. If we want results we must get control of adequate power, and we must learn to use it with safeguards. If we want to make tunnels, and to make them rapidly, we have to concentrate supplies of dynamite; danger results; we minimize it, but we never get rid of it. In late years our streets have been filled with power-driven cars and vehicles; the risk and danger of going on the streets has been very greatly increased; the danger is licensed by law, and it is inseparable from the satisfaction of our desire to move about rapidly.  . .

.

I often see statements published, in which the objectors lay stress upon the great inequalities of fortune, and, having set forth the contrast between rich and poor, they rest their case. What law of nature, religion, ethics, or the state is violated by inequalities of fortune? The inequalities prove nothing. Others argue that great fortunes are won by privileges created by law and not by legitimate enterprise and ability. This statement is true, but it is entirely irrelevant; we have to discuss the concentration of wealth within the facts of the institutions, laws, usages, and customs which our ancestors have bequeathed to us and which we allow to stand. If it is proposed to change any of these parts of the societal order, that is a proper subject of discussion, but it is aside from the concentration of wealth. So long as tariffs, patents, etc., are part of the system in which we live, how can it be expected that people will not take advantage of them; what else are they for? As for franchises, a franchise is only an x until it has been developed. It never develops itself; it requires capital and skill to develop it. When the enterprise is in the full bloom of prosperity the objectors complain of it, as if the franchise, which never was anything but an empty place where something might be created, had been the completed enterprise. . . the modern methods offer very great opportunities, and the rewards of those men who can “size up” a situation and develop its controlling elements with sagacity and good judgment, are very great. It is well that they are so, because these rewards stimulate to the utmost all the ambitious and able men, and they make it certain that great and useful inventions will not long remain unexploited as they did formerly. . . No man can acquire a million without helping a million men to increase their little fortunes all the way down through all the social grades. . .

What matters it then that some millionaires are idle, or silly, or vulgar; that their ideas are sometimes futile and their plans grotesque, when they turn aside from money-making? How do they differ in this from any other class? The millionaires are a product of natural selection, acting on the whole body of men to pick out those who can meet the requirement of certain work to be done. In this respect they are just like the great statesmen, or scientific men, or military men. It is because they are thus selected that wealth — both their own and that intrusted to them — aggregates under their hands. Let one of them make a mistake and see how quickly the concentration gives way to dispersion. They may fairly be regarded as the naturally selected agents of society for certain work. They get high wages and live in luxury, but the bargain is a good one for society. There is the intensest competition for their place and occupation. This assures us that all who are competent for this function will be employed in it, so that the cost of it will be reduced to the lowest terms; and furthermore that the competitors will study the proper conduct to be observed in their occupation. This will bring discipline and the correction of arrogance and masterfulness.

Print version: concentrationwealthed.docx

Webpage for source: http://oll.libertyfund.org/?option=com_staticxt&staticfile=show.php%3Ftitle=1656&chapter=143464&layout=html&Itemid=27

This version edited by Mara Lazda