The Corporation and the Twentieth Century

much concentrated, but because it is not sufficiently concentrated. Socialists consequently re- joice in the formation of trusts and combinations, holding that they are a development in the right direction.”

63. Rodgers (1998, pp. 100–101).

64. Litterer (1961).

65. Chandler (1977, pp. 172–81); Litterer (1963). This was understood at the time. In his brief

in the 1911 Eastern Rate Case before the ICC (on which see below), Louis D. Brandeis put it this way: “The management assumes the burdens of management, and relieves labor of respon- sibilities not its own. It substitutes functional or staff organization for the military system” (Brandeis 1912, p. 15).

66. As Karl Popper (1963) would declare in the middle of the twentieth century, the search for methods of revealing hidden truth reflects a premodern conception of science. Modern science is a process of conjectures and refutations. It is about skepticism, experimentation, and invention—the opposite of unanimity.

67. Gilbreth and Gilbreth (1920).

68. Croly (1914, p. 397).

69. McCraw (1984).

70. Brandeis (1912). As we will see, the ICC had gained rate-setting powers by this time.

Although he would have sacrificed efficiency for smallness, Brandeis believed in this case that scientific management was most successful in intermediate-size shops not the big firms (Haber 1964, p. 82).

71. Adelstein (2012); Kraines (1960).

72. There are biographies and assessments of Veblen aplenty. I recommend Seckler (1975). For the notion that Veblen influenced Dewey instead of the other way around, see Menand (2001, p. 305). In much the same way as Schumpeter, Veblen owes some, if by no means most, of his perceived originality to the ignorance by English-speaking scholars of the German-language literature in which Veblen was immersed. In particular, “Sombart and Veblen especially give evi- dence of having read and admired one another’s work” (Loader and Tilman 1995, p. 339).

73. Veblen (1898).

74. This is in fact an intellectual error. What the philosopher Daniel Dennett (1987) calls the intentional stance—the assumption of human agency and intention—is crucial to explanation in the social sciences and fully compatible with an evolutionary epistemology. It is ironic that Veblen chose to attack specifically the marginalist economist Carl Menger, whose theory did not actually rely on hedonism (or indeed on psychology at all) and who championed evolution- ary causal explanations in the spirit of the Scottish Enlightenment (Langlois 1989).

75. Veblen (1899).

Notes to Chapter 3 567

76. See Mills’s introduction to the 1953 Mentor edition of The Theory of the Leisure Class, p.vii.

77. Veblen (1901). Characteristically, Veblen didn’t actually turn up at the meeting to present the paper in person. The paper formed the basis of what became The Theory of the Business En- terprise (1904).

78. Veblen (1901, p. 210).

79. Veblen (1921). As Philip Mirowski (1987, p. 1022) puts it, Veblen “tended toward an in- creasingly pessimistic Manichaeism with sufficient reason as the darkness and efficient cause, now conflated with Peirce’s pragmatic maxim, as the light.” Mirowski thinks the problem is that Veblen got his Pragmatism from James and Dewey not really Peirce, but there is reason to think that Veblen was indeed channeling Peirce (Menand 2001, p. 366). For his part, John Dewey returned the favor. The economics of his Individualism Old and New, published the year after Veblen died, is unadulterated Veblen. “It is claimed, of course, that the individualism of eco- nomic self-seeking, even if it has not produced the adjustment of ability and reward and the harmony of interests earlier predicted, has given us the advantage of material prosperity. It is not needful to raise here the question of how far that material prosperity extends. For it is not true that its moving cause is pecuniary individualism. That has been the cause of some great fortunes, but not of national wealth; it counts in the process of distribution, but not in ultimate creation. Scientific insight taking effect in machine technology has been the great productive force. For the most part, economic individualism interpreted as energy and enterprise devoted to private profit, has been an adjunct, often a parasitical one, to the movement of technical and scientific forces” (Dewey 1930, pp. 86–87).

80. Here the stream of scientific management flowed back to Veblen, who became influ- enced by an uprising recently fomented within the American Society of Mechanical Engineers by some of the leaders of the scientific-management movement. As Edwin Layton (1962) ex- plained, however, Veblen got this all completely wrong: the uprising was not the work of the line engineers Veblen exalted but of consulting engineers—a far more pecuniary breed—who were protesting the reduced status they were suffering as more and more engineers were hired on as line employees of corporations.

81. Klein and Leffler (1981).

82. Young (1989, pp. 73–74).