The Small Business as a School of Manhood

FOR generations the small business, that is, the business house as it was before the advent of the great Corporation and the Trust, was a school of character second in importance only to the Church. It is now rapidly being superseded, and the question is, What is to be the effect upon the business world ?

Many years ago I was confidential clerk in a typical city business house of the old style. Its heads were two young merchants, both from New England. As I was their confidential clerk, I had the opportunity of knowing them both intimately, and of observing the effect of their business upon their characters. The one was a gentleman by instinct and family connection, — courteous, kindly, and unselfish. The other was self-made, aggressive, cold-blooded, ambitious, selfish, and intelligent enough to know the value of honesty as a policy, but without convictions. The daily routine of the business divided itself between these two men by a kind of natural law. Everything that required courtesy and the cultivation of the good will of customers fell to the one ; while the planning of the business, and all those important decisions which had to do with men whose good will was not particularly important to the firm, were passed upon by the other. The business itself, with its daily necessities and routine, constituted a school of character, giving play to the talents of both, and holding their limitations in restraint. It would be interesting to look over the office letter-books of those days and read in the correspondence the characteristic features of those two men, one of whom has since become very prominent. There would be found recorded, as accurately as in the record of a boy at school, their native traits and the story of their growth. Each knew, as all the men of their day knew, that the success of every business house depended upon the personal traits of the partners and their individual relations to the world of business, quite as much as upon the wisdom of their plans.

This is understood in all forms of individual business, from the village store to the city establishment, where in each instance the storekeeper is made keenly aware of the value of the good will of his customers. As a consequence he i3 kept under an impulse to be courteous and honest and considerate and truthful, until these traits become largely characteristic. Whatever men may think about the business of the world, it is inconceivable that the great business houses of the older type, which, passing from father to son, sometimes survived for centuries, could have continued under any other conditions. The great guilds of the Middle Ages were simply associations of men of this pattern. They organized for self-defense as individual merchants or tradesmen, not in any sense as partners in a corporation. And membership in these guilds quickly came to be dependent upon certain established types of character. Because of this the guilds held together, and became the permanent power which resulted in making the cities the instruments which enabled the early kings to shake off the power of the barons, and to break up the foundations of the feudal system in Europe. The Chinese guilds, the oldest existing organizations of business men, are also of this class.

The record of those early days still remains in our literature. Shakespeare’s tale, the Merchant of Venice, turns upon the integrity, indisputable and dominant, of the merchants of that time; and the effect of the Chinese guilds upon the Chinese mercantile life is everywhere apparent. The other day the president of the Anglo-Chinese Bank at Shanghai, resigning, to return to England, after twentyfive years of service, in a public address testified that not a dollar had ever been lost by the bank through a Chinese merchant, and that the great fear he had for the changes now going on in the relations between the Orient and the Occident was lest the influx into China of foreign merchants, with a different standard of personal honesty, would do more to complicate and disturb the relations of China with the outside world than any other cause. For the Chinese have not been familiar with the lower standards of business integrity which prevail elsewhere.

Over against the guilds have arisen the modern Corporation and the modern Trust. They have so completely changed the essential conditions of business life as these bear upon the individual business man, that it is well to attempt to estimate the effect. Many men in New York remember when A. T. Stewart opened his great establishment in the Chambers Street building. It soon became known in the street that when any failure occurred in the dry-goods district, the principal man in the broken firm would be quickly invited by Mr. Stewart to enter his employ. And it was not long before in the Stewart establishment could be seen many well-known business men, whose houses had been unfortunate, now servants of Mr. Stewart, as buyers, or heads of departments. A change in the bearing of these men was noticeable even to young people. They no longer had either the responsibilities or the dignity of their former position. Their income, it is true, was assured, and perhaps was in some cases as large as it had been before. They were not burdened with cares for the business as a whole, and could go home at night with the same feeling of a day’s work done that other clerks enjoyed. But they were no longer business men, in the old sense. They were servants, in that their powers were obedient to the decisions of another; and they were removed from the stimulus, intellectual and moral, which the necessities of meeting the conditions of independent business require. It is true they slept well at night, and grew fat and sleek; but one was reminded of the fable of the wolf and the house dog, — one looked for the sign of the collar, and mourned for the loss of something fine in manhood. Such a man came into the employ of the firm for which I worked, and his struggle to maintain his selfrespect, and his little-repressed exultation in being a member of a social club to which his ambitious employer could not obtain election, were to his fellow clerks both intelligible and pathetic.

The pride of the merchant, or the manufacturer, in the business to which he was giving his life, and which bore his name, and which he hoped to make permanent in the community and to transmit to his children, has given place to another temper of mind in the passing of those smaller men into the great corporations. Names still linger from the early days: the Maydole hammer, the Buck chisel, the Disston saw, the Scott gun, the Morley hosiery, the Clay woolen, the Torrey strop, the Hassell brush, tell of a day when the skillful workman began to produce a better article than his neighbor, and soon discovering that his customers recognized its merits, found the way open to a career in which his heart found its sweetest pride, and his business life its most satisfactory reward. All that has vanished with the passing of the old conditions.

Under the new conditions a very few men are carrying the heavy strain, or may be considered as responding to the old challenge to be their very best, and to prove themselves masters in a splendid contest. It must be admitted that the prizes of the business world were never so magnificent for the capable few as they are to-day. The title “ merchant prince ” has taken on a new significance. But this applies only to the very few. Where there are in every great corporation or trust two or three or, perhaps, a few more, men at the head who carry the responsibility and find their powers taxed to the utmost by their daily duties, there are thousands of all grades of capacity, who now have no other feeling than that of the clerk, or the servant. Their intellectual activity is limited to doing the task that is set for them. They need to be keen, simply to understand directions and to meet the requirements of their department. Their moral responsibility is limited to obeying orders and earning their daily wage. The tax made upon them is only to do their day’s work as it arrives, and at night leave their desk clear. They are part of a vast machine to whose perfection they are contributing ; and in so doing are limiting their own powers, and bringing on the day when they can the more readily be dispensed with and forgotten. The best they can hope for is a pension. As life goes that is much, but it is not the best.

The other day I asked the auditor of a great Trust, “ What is the method upon which your new business is being organized, — to make a machine so perfect that no knave can take advantage of it, or to develop individual character to such an extent that the machinery shall be relatively secondary ? ” He looked at me for a moment, and then with a curious smile, said, “The latter is what I should be glad to do, but my directors have different ideas. We are trying to make a machine which will be as absolutely perfect as possible.” “Then,” I said, “ you will be beaten, for a man is always cleverer than a machine.” “ Yes,” he said, “I fear so.” He has himself since resigned, and gone back into private business.

The great corporation is unquestionably the necessity of the hour. It will continue to take on constantly new forms of development. It is already playing and will continue to play a tremendous part in the progress of civilization. But its limitations are none the less real. The evils that are inevitably connected with it must be clearly realized if they are to be offset. Among them all none is more serious than this radical one of the effect upon the character of many employees, who, under former conditions, would have been either managing their own business or ambitious for the opportunity of doing so. The life, in a multitude of homes where a salary takes the place of business earnings, is doubtless calmer and steadier, and also in many cases ampler, in that the income is larger. A certain stability is hoped for in a society where anxiety over business conditions is exchanged for the contentment of an assured stipend. And the steadying and quieting of the temper, no longer made irritable by the daily anxiety, is unquestionably a notable social contribution. Indeed, it is quite conceivable that whole communities, like our new suburban settlements, made up of pretty homes, with their flowers and their lawns, which are occupied so largely by the well-to-do employees of the great corporations, maybe regarded as one of the most beautiful and most characteristic features of modern life. But when one looks within and asks what is to take the place of the old discipline, with its insistent demand for those traits of character which have made the merchant and the manufacturer the sturdy, thoughtful, selfrespecting men they always have been, we are at a loss for an answer.

When thoughtful writers like Mr. Benjamin Kidd speak of “ the freest possible play of forces within the community, and the widest possible opportunities for the development of every individual’s faculties and personality ” as the condition of progress, and of “the personal rivalry and competition of life ” as being not only now, but having been from the beginning “ the fundamental impulse behind all progress,” there is surely cause for concern as we find ourselves tempted to exploit agencies which effectually remove or destroy those conditions.

It is certain that a great change is going on, and one of that subtle and unperceived kind the effect of which is sure to be widely felt before it is understood, not to say corrected. How much it means of difficulty, or even of disaster, in the business world of the future, it may be difficult to determine, but it will certainly have a profound effect in shaping the prospects even of the Trust. It creates conditions under which it will be growingly difficult to produce men with the character and the intellectual stamina which are necessary in the management of the great corporations. Men who have grown up simply as clerks will never be truly competent to fill these positions. They will become more and more men of detail. And the system of inbreeding, that is, of limiting the filling of their more important posts to men who have risen through all the ranks of lower service, — which now is proclaimed by some of our great railways, — is a policy as truly suicidal as it is unintelligent. Great administrative positions require men who have been accustomed to that independence of action and that breadth of view which only the responsibility of directing their own affairs can produce. It is a temper of mind and of spirit as far as possible from that of the lifelong clerk or employee. And no problem in the business world is more vital, or has fartherreaching relations, than the question how such men are in the future to be produced.

Henry A. Stimson.