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A Perilous Progress
Economists and Public Purpose in Twentieth-Century America
By Michael A. Bernstein PRINCETON UNIVERSITY PRESS
Copyright © 2001 Princeton University Press
All rights reserved.
ISBN: 978-1-4008-6508-6
CHAPTER 1
Shaping an Authoritative Community
[E]conomists have altogether too little influence; they are too silent on public questions, and when they do speak their opinion commands less respect than it deserves. —Irving Fisher (1902)
The emergence of an American economics profession was not uncomplicated, nor was it, in its particular features, uncontroversial. The founding of the American Economic Association (AEA) itself stimulated an array of debates concerning the society's objectives, practices, and public image. With a cadre of original leaders like Richard T. Ely, a social activist and intellectual who had taken up his first academic appointment at Johns Hopkins, the AEA was, as its most eminent historian has argued, originally an "offspring of mixed parentage—European scholarship and Yankee social reform." The "Young Turks" who, like Ely, saw in a new economics an opportunity for social scientific research to be more relevant and more apposite to the resolution of vexing political questions enjoyed a brief but heady period of influence. Eager to see the AEA "play an active part in disseminating 'sound' economic ideas and [in] shaping public policy," they were also determined "to enlist the support of a wide variety of non-academic persons" in the realization of their goals.
Yet by 1905, in the wake of what had been a two-decade struggle over the roles of "advocacy and objectivity" in modern social science, the AEA (not unlike several other social science societies) set course toward the realization of a more "scientistic" and seemingly dispassionate set of professional ideals. Nurtured in "the belief that the objective methods of the natural sciences should be used in the study of human affairs; and that such methods [we]re the only fruitful ones in the pursuit of knowledge," a new breed of American economist rejected the notions of Ely and his protagonists. These "militants" would ultimately use professionalization as a tool to gain access to the academy, the media, and the councils of government; moreover, "[w]ith professionalization, objectivity grew more important as a scientific ideal and also as a practical necessity."
By the first decade of the twentieth century, therefore, American economists were ready to initiate a project of professional fulfillment that stood at the end of centuries of intellectual evolution in their discipline. At the same time, having already weathered strenuous disputes over the nature of their founding professional society, they were particularly sensitive to questions of objectivity and scientific rigor in their work. Indeed, both in the example of the physical sciences and in an ideology of American exceptionalism, these "neoclassical" theorists detected worthy and inspiring guides to the advancement of economics itself. Precision in method would secure the field respectability, influence, and self-enforced boundaries; a conviction that modern America was devoid of the atavistic conflicts and retrograde traditions of the Old World would allow for the widespread acceptance of the need for an ostensibly value-free social science, one that would place in the hands of experts the means with which to secure the common good—a common good about which all reasonable (and well-educated) men and women could agree.
In shaping an authoritative community, American economists could, by the early 1900s, look with satisfaction on the intellectual and institutional processes that had, in both the long and the short run, set the terms of their task. What they could not anticipate, of course, were the particular historical circumstances within which they would have to work toward its completion. Making a virtue of the necessities those situations would impose came, to be sure, as second nature to many. Yet the ironies and ramifications of that history would remain and have remained hidden to most.
Under its charter of incorporation, the AEA committed itself to "the encouragement of economic research, especially the historical study of the actual conditions of industrial life," as well as to "the encouragement of perfect freedom of economic discussion." In particular, "the Association as such [took] no partisan attitude, nor commit[ed] its members to any position on practical economic questions." While the formal organization was thus made distinct from the individual activities and convictions of its members, nevertheless the stresses and strains attendant upon the struggles over its initial establishment were, in its earliest years, never far from the surface. These anxieties in turn framed the process by which major decisions were ultimately made concerning AEA membership criteria, annual meetings, publications, and operational procedures; what is more, they made the Association's leadership particularly eager to seize upon whatever opportunities and circumstances within the public arena might enhance the prestige and sway of their field. The implications and ramifications of those choices, while in many cases obscure for some time, had a profound impact on the twentieth-century evolution of the profession and its discipline.
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Of immediate concern to the fledgling community of experts that was the AEA itself was the building of a substantial, not to mention impressive, membership. During the first decade of its existence, their new professional association committed itself to the attraction of both scholars and businesspeople to its ranks. The instinct for a catholicity in recruitment was no doubt an outgrowth of an effort to overcome the divisive arguments that had taken place leading up to the chartering of the AEA at Saratoga. Yet it was also born of an increasingly confident vision of an objective and scientific organization. By the first decade of the new century, that image had assumed a coherence that allowed AEA president (and distinguished professor at the University of Pennsylvania) Simon N. Patten to put earlier controversies in perspective. Patten told none other than Richard Ely, in the fall of 1909, that even if the Association "was a protest not only against the narrow English economists but also against ... current political and social ideas[,]" nonetheless it "ha[d] narrowed its functions since the Political Science Association and the Sociologists ha[d] split off from it."
A few weeks later, Thomas N. Carver, professor of economics at Harvard and then secretary of the AEA, went further than Patten in describing the "character" of the Association to an official of the American Historical Association. Noting that in its earliest days, the Association was split between two groups, one of which "desired to make [it] a propagandist party leading a reaction against ... laissez faire doctrines," and another of which "opposed any form of propagandism," he made clear that it was the latter faction that prevailed. "It was the desire of this party," he wrote, "that the Association ... be kept a purely scientific body, with perfect freedom of discussion, and [with] room for every possible difference of individual opinion."
How precisely to define the nature and contours of a "purely scientific body" was a not uncomplicated task, especially when it was counterposed to the obvious need to expand the new Association's membership. AEA leaders like Carver thus often found themselves forced to mediate between the conflicting claims and interests of academic economists and members of the business and wider professional community. When, for example, an attorney from Portsmouth, Ohio, complained that the AEA needed more "young, active and aggressive business men to balance the Colleg [sic] and University professors ... to give it a composite tone, largely influenced by the business element," diplomacy rather than scholarly self-assurance was the ticket. Eager to avoid alienating a nonacademic member of the Association, Carver sought to mollify him, arguing in reply that "it [wa]s the general opinion of economists that [they] have much to learn from lawyers and business men"; indeed, it was the desire of the AEA secretariat "to increase [its] membership from among that class." He thus asked his correspondent to feel free to submit nominations of new members drawn from outside the academy.
In 1910, when Carver wrote Evans, the membership of the AEA stood at 1,360. Four years later, in a report to his superiors, the new secretary, Allyn Young (of Cornell University), could note with satisfaction that this figure had almost doubled. Even so, there was the obvious challenge that expanding the membership further would require extending the reach and appeal of the AEA beyond the professoriate per se. To the extent that the field of economics, in academic institutions nationwide, remained of modest dimensions, it seemed clear that growth would necessarily be premised upon an expanding domain of interested participants. On the one side, a rising number of academic economics programs, and of faculty and students within them, would provide an obvious stimulus. On the other, maintaining a presence in the nonacademic community would also be necessary. Efforts along these lines would, of course, require energy and application; they would, as well, create rather than simply resolve problems.
By the winter of 1914, Secretary Young had resolved to undertake a major initiative to increase the size of the AEA rank and file. Compiling a mailing list on the basis of suggestions garnered from his colleagues in the Association leadership, and from others primarily within the academic arena (such as department chairs and tenured faculty members), he began a direct solicitation campaign that ultimately reached out to some fifty-three hundred addressees. In this project he had taken to heart the suggestion of one distinguished colleague who had urged him to target specifically "junior [academic] staff" because it might then be "possible to develop a sense of professional loyalty, such as is to be found in other professions, particularly the engineering and scientific [ones]." Moreover, Young solicited rosters of graduate students, making them a recruitment target as well.
Despite his remarkably energetic foray, however, Young had to admit to a former AEA president and current editor of the recently established American Economic Review, just before the Thanksgiving holiday in 1914, that the returns to his mailing blitz were "disappointingly small." His frustration, in this regard, was actually the result of two tendencies that, when taken together, conspired to keep the net growth of Association membership at relatively low levels. For graduate students and junior faculty, Association dues were not trivial, and it appears that many of this younger generation found the "price of admission" literally too high. Professor H. J. Davenport of the University of Missouri had warned Young of this mundane yet telling fact some six months earlier. Graduate matriculants at Missouri, he noted, were "so poor financially" that it would be best if the membership drive "not waste ammunition on them." Even some older members found AEA dues a burden. "I know of no one not already a member," a history teacher at Mechanic Arts High School in Boston told Young, "who is interested [in AEA membership] to the extent of $5 a year. I doubt if I am."
Beyond the difficulty of persuading newcomers to join, Young and his colleagues in the AEA secretariat had the additional challenge of convincing current members to stay on. This test was especially acute with respect to the nonacademic affiliates whose numbers were believed to be so essential to the Association's well-being. Davis Dewey, in fact, had warned Young that past April that membership "withdrawals [were] almost uniformly [occurring] among the nonprofessional class." To the extent that "teachers or experts rarely resign[ed]," it seemed obvious to Dewey that "[i]t would add greatly to [the Association's] strength if [its] membership could be more largely confined to those whose interest [wa]s permanent." Dewey, Young, and the AEA leadership as a whole had more than good reason to be concerned; 59 members had left the Association in 1910, although some 400 new recruits had joined. The net balance between arrivals and departures remained positive for two more years; but in 1913 a truly bad patch had been encountered. In a twelve-month period, close to 500 members had resigned while only 270 new participants had been added. At that rate, the Association would simply fade away in about a decade.
Yet in urging the confinement of AEA membership "to those whose interest [wa]s permanent," Dewey had engaged in a curious choice of words. The issue, for those members who took the time to inform the Association of their decision to withdraw, was not the transience of their engagement with economic matters, but rather the uncertainty that their particular interests could be accommodated to suit. When Horace Hoadley, the president and treasurer of the Waterbury (Connecticut) Tool Company, wrote to resign his membership, he explained that he was not "a thoroughly educated economist." He thus felt compelled to "devote [his] efforts to ... other organizations rather than in one that [wa]s primarily scientific." The chief of the Bureau of Foreign and Domestic Commerce at the Department of Commerce in Washington, D.C., was by contrast quite blunt. "[T]here seems to be so little of interest in your periodical and so little of real vital interest in your meetings," he wrote Young, that he wished to leave the Association. Further, he complained, the lack of any individuals in the AEA leadership drawn from the business community was most unfortunate. In reply, Young reiterated that the Association wanted members drawn "from all walks of life who [we]re interested in any way in practical economic problems." Yet the organization, he wrote, was reluctant "to try to extend [its] membership among business men except insofar as they thoroughly underst[oo]d [its] purposes and work."
In his rejoinder to a disgruntled colleague at the Department of Commerce, however, Young had been, if not disingenuous, then certainly oblique. Just months before he had told a business manager from Albany that, in his view, "the Association ha[d] gone too fare [sic] in catering to the interests of business men and to the outside public generally." To be sure, Young may have felt more freedom to unburden himself of his true feelings in this case given that he was communicating with a member who had argued for either stringent membership standards for the AEA or a separate scientific branch. Even so, Young (ostensibly representing the interests of the AEA leadership as a whole) believed that what he referred to as a general organization could not have the exacting standards of recruitment that the upstate New York administrator had described. Delicately treading the line between several conflicting points of view, Young's seeming prevarication epitomized the conundrums that faced an organization determined to build its ranks yet also equally convinced of the need to police them.
Their insecurities and misgivings notwithstanding, Young and Dewey and their colleagues pushed ahead with their membership efforts. By the end of 1915, they were determined to pursue the expansion of AEA membership so long as "that c[ould] be secured without any sacrifice of [thei]r position as an organization of persons interested in the scientific study of economic problems." Even some anxiety that they might "be liable at some time to charges of dominance by an 'inner ring' such as [George] Bancroft and others ha[d] raised against the Historical Association" did not deter these men from their task. If, at times, it was necessary to humor the occasional eccentric or adventurer, all for the sake of nurturing an open and democratic face for the new Association, nevertheless its self-identity was clear. "[I]nterested in the scientific study of economic problems," the roughly twenty-three hundred members of the AEA were, by 1916, mostly academic and professional economists, businesspeople, and government officials. Clearly, then, as Young put it to an Atlantic City physician who inquired about membership in the spring of that year, "The American Economic Association [wa]s the professional organization of the political economists of the country and occupie[d] in that field the same position that the American Chemical Society, the American Historical Association and the American Medical Association d[id] in theirs."
With a clearer and more self-conscious notion of what their Association was about, AEA leaders like Young believed their membership problems to be well on the way toward resolution. Growth in the rank and file that outstripped losses due to resignation became the norm by the time of the nation's entry into World War I. At war's end, the Association initiated one more recruitment effort, the success of which was deeply gratifying to its architects. Improvement in the membership profile, at that point, was linked with the increasing number of academic economists now interested in the work of the organization; it was also tied to the larger and larger number of economists working in "government agencies, and independent research institutions." After the early years of the 1920s, AEA officials evinced little concern with respect to the size of their organization. The Association, in their view, had clearly weathered at least some of its earliest growing pains.
(Continues...)
Excerpted from A Perilous Progress by Michael A. Bernstein. Copyright © 2001 Princeton University Press. Excerpted by permission of PRINCETON UNIVERSITY PRESS.
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