ALTERNATIVES SEEN AS BASIC ECONOMIC FACTS 203
ing cost and diminishing return stop the wheels at last, and drop
the man. He then faces a new alternative. He gives another
expression to his demand for present goods, without which he
must lose his chance. He pays interest.
Look at the matter any way you will. We must have present
goods that can be capitalized, and we must capitalize. But
that we may have goods to capitalize somebody must speed up
and work over-time, and the rest of us must now and then pay
interest or lose our chance.
The sixth and last of the basic economic facts here to be named
is the alternative: Value-making must proceed rationally and
realistically or it will proceed non-rationally and fantastically.
The economist does not have to assume that objective value, or
price, expresses anybody’s calculation of utility. He may dis-
cover that it does not. Until we are able to make intellectual
estimates of desirability we are free to measure it by “hunches,”
wishful thinking, and credulity, in short, emotionally, and we do.
It would be difficult to prove that the “classical” economists
consciously assumed that values are measures of utility arrived
at by calculation, but their pages abound in evidences that often
they made the assumption unconsciously. Cournot and Bentham
prepared the way for overt declaration that values essentially
are such measures, Jevons, Menger, and Von Wieser made it.
In a paper on “Concepts of Utility, Value and Cost,” * I under-
took to give it definite and explicit expression. It can no longer
be defended, except as an affirmation of what might be expected
to occur in a world predominantly and highly intelligent. Our
later psychology forbids us to affirm this of the world in which
We now carry on. It is one of the striking evidences of prescience
in Professor Clark’s account of value that it leaves the way open
for a broader view. And one of his distinguished former students,
Dr. B. M. Anderson, sometime professor of Economics at Colum-
bia and at Harvard and now Economist of the Chase National
Bank, has sketched the broader view in his study of Social Value.
So, once more, we drift back to “the sociological character of
political economy.”
* Publications of the American Economic Association, 1891, Vol. VI,
and see ibid., “The Idea and Definition of Value,” Vol. VIII.