Dear Unknown Friends:

Here is the first part of What Was Going On, a lecture that Eli Siegel gave in April 1975. It is a lecture important for our own time, for these very days of ours.

Nearly five years earlier Mr. Siegel had begun his series of Goodbye Profit System talks. In them he showed that a way of economics which had gone on for centuries, and which had always been contemptuous and unjust, now no longer worked. This failing thing was economics based on the profit motive: that is, based on the ill will of seeing one’s fellow humans as beings through whom to aggrandize oneself—through whom to acquire as much money as possible. Mr. Siegel said in 1970:

What is being shown today is that without good will, the toughest, most inconsiderate of activities—economics—cannot do so well….There is a feeling all over the world on the part of persons who work that they are not getting their just share of the gross national product, and they feel that their not getting it is caused by ill will….The world is saying: We don’t want ill will to hurt and poison our lives anymore. I wish I could call it something else—good will and ill will are such pale words; but that is what it’s about….In May 1970, the conduct of industry on the basis of ill will has been shown to be inefficient.

He explained that while persons might make profit-motivated economics grind on for decades more, it would never flourish again. Today, Americans are increasingly demanding that life in our nation be based on respect for all people. In fact, the only way our economy can now succeed is to have that basis of respect and good will.

Then, Now, & Years to Come

In those Goodbye Profit System talks Mr. Siegel gave evidence from history, literature, past and current economists, daily events. And in this journal I have commented on what he explained, in terms of life today. The wealth of our nation is in the hands of fewer and fewer people. For millions, including of the erstwhile middle class, there are joblessness and worry about how to feed one’s family and have a place to live. Millions of children are going to bed hungry. In the years to come, the idea that our economy was based, not on justice to people, but on making profit through them, will be seen as shocking, utterly immoral—and inefficient indeed.

In the 1975 talk What Was Going On, Mr. Siegel discusses an article in the bicentennial issue of Fortune magazine: “Reshaping the American Dream,” by Thomas Griffith. Mr. Siegel looks at the feeling in America of then (nearly 46 years ago). The situation now is different, of course; yet what he explains is a means of our understanding ourselves and our country now. Since Griffith writes about “American institutions,” Mr. Siegel comments, in this early section, on what an institution is. He gives a definition of the word. And he mentions various institutions, which continue today and are also in the midst of change. Mr. Siegel describes those institutions in a way that is lively yet deep, that has lightness yet exactitude. We feel the humanity, the lives, concerned in them.

The Family, Recurrent & Different

I ’ll comment a bit on one of the institutions he mentions, as a means of illustrating something Mr. Siegel explained: that “ethics is a force” in history and life. The big fight within every person and in history itself, is the fight between ethics—the desire to take care of oneself by respecting what’s not oneself—and contempt, “the addition to self through the lessening of something else.” Contempt can seem, and be, ever so powerful—yet how powerful ethics is, has not been seen. And ethics has been insisting and showing itself in many forms. That is so as to the institution I’ll comment on: the family. The big change in that institution which is the American family happens to represent a more ethical way of seeing had by the American people themselves.

It’s quite clear the family of 2021 looks different from that of 1921. The “blended” family, “diverse” family, “inclusive” family; the family in which (for example) one’s cousin or stepsister or parent has a skin tone very different from one’s own; in which Thanksgiving dinner looks like the United Nations—this is no longer surprising in America. And that fact is a victory for ethics. “All beauty,” Aesthetic Realism explains—including that beauty which is ethics—“All beauty is a making one of opposites, and the making one of opposites is what we are going after in ourselves.” The makeup of millions of families today is a sign that people feel what’s different from oneself is like oneself too; that humanity in its manyness is also a unity.

Since any family, no matter how diverse, is composed of people, contempt can take place in it. A person, for instance, can have a profit system way of mind toward a sibling: “You’re my sister—I own you; and I don’t have to think deeply about who you are and what you feel.” And no matter how diverse or un-diverse a family’s ethnicity, the people in it can have that age-old ugly feeling, “MY family is superior to all those other families.” All people need to learn from Aesthetic Realism about the ethical fight in humanity and themselves.

Yet what has happened in the makeup of the family is a big and significant thing. It’s a sign of what people (in no matter what domestic arrangement) want to feel: Humanity is my family; all of America is my family. The economic form of that is: We should own the world together, the nation together.

—Ellen Reiss, Aesthetic Realism
Chairman of Education

What Was Going On

By Eli Siegel

I think history will tell in some decades that a certain way of owning and making money was shown to be out of date in the 1970s. This bicentennial issue of Fortune is something I think everyone should have, because it’s a presentation of American history, really, in terms of what is going on now.

At the same time, on the cover we have the immemorial antique malarkey: we have in a title “Special Bicentennial Issue: The American System.” What is here called “the American system” has been the system in every European country, and also, as soon as South America became populated and somewhat wealthy, it became the system there. “The American system” is in Argentina and Brazil and Colombia, and has been in Belgium, England, France—that is, an ownership of the means of industry for private profit. Human nature has gone for the making of money and for ownership, and you might as well say that the clouds are American. I’ve read the Constitution; I’ve read the Declaration of Independence. And there is nothing in the Constitution about how industry should be owned, and nothing about it in the Declaration.

That malarkey has been around a long time—there’s the phrase “the American way.” You might as well say there’s an American way of the heart beating. If you study the heart, you will find that it beats in Finland pretty much the same way it does in Oregon. But the phrase is a way of sneaking in the “rightness” of something without any person’s looking at it.

So on the cover of this issue of Fortune we have “The American System.” First of all, the Iroquois, Onondagas, Seminoles didn’t have that system, and they were American. And the Narragansetts didn’t have anything like stocks and bonds. So I object to the term. But it’s one of the cleverest ideas: somehow to relate the profit system to America. There is no connection whatsoever, except the fact that it was in America, as it was also in Belgium. You might as well say it’s “the Belgian system.” Also, if one reads the Buddenbrooks of Thomas Mann, one sees, with how ownership went down from a grandfather to a father to a grandson, that it was very “American,” that German Buddenbrooks family.

The big thing is this: Who should own the world?

Ethics & Laws

Also on the cover, various phrases are quoted. Martin Luther King is quoted: “Morality cannot be legislated, but behavior can be regulated.” That is true. Morality doesn’t need to be legislated because its possibility is already there; that is, there is a difference between saying something and keeping your word, and saying something and not keeping your word. It’s been felt that if you say something and keep your word, you have more ethics or morality than if you say something and don’t keep your word.

Some actions, it seems, are better than others. If a person is beside another by a river and says “Look at that interesting bird flying over the water,” that’s more of a moral action than kicking the other into the water. Morality is an inherent possibility of what human beings can do. Morality cannot be legislated—but morality has been in legislation. For example, it has been in laws against child labor. And there’s the FDIC, Federal Deposit Insurance Corporation: the purpose is to have more morality in banks. The FDIC arose through that non-American-system person Franklin D. Roosevelt.

It is hoped that as the Congress meets there will be more morality. For instance, people have felt it was immoral to give persons who own oil a right to pay less in taxes because of “capital depletion”—which, of course, an ordinary person can never go through because he or she has not much capital to deplete. The giving of certain tax rights to certain people was seen as immoral. In every law there is an ethical aspect. In fact, the chief argument against the Fugitive Slave Law was that it was immoral: people shouldn’t be asked to hand over a Black person who had been a slave and who finally got into a free state!

In America Now

There is the matter of what is going on now. As I’ve said, I feel rather sure that America is becoming more American; that is, it is giving a chance, it will give a chance, to more people to have a life that is one of knowledge and not so much of worry. That’s one of the things in America.

As I see it, the chief article in this issue to talk about is “Reshaping the American Dream,” by Thomas Griffith.

It’s important to look at a word used often in it: institutions. Griffith has the phrase “American institutions.” These institutions are chiefly those that other countries have. An institution can be defined as something present in a country or in the world in a recurrent way—as, let us say, a notable institution is the family. The family is an institution because the family exists in the laws of the state and somewhat in federal laws; it’s a recurrent thing and, right from the beginning, if two persons had children they all became a group of people that was recognized by others. The family is an institution, a persistent thing in the life of a country. It is sociological, but it is also historical, and has been used poetically and sometimes used in novels.

The largest institution is government. A child who is born today is going to find out soon that there are people who seem to claim a certain authority. For example, the child will notice that somebody is dressed a little differently—because even in New York today you can distinguish a policeman from a librarian. There’s no librarian uniform, and there’s no abstract artist uniform yet. So one sees that there’s somebody in charge. And the thing that’s in charge can be called the government. Occasionally it’s for a whole country, the federal government. But there can be persons in charge of a village.

The first function of government is to protect you—though most people think the first function of government is to stop you. But the government says its purpose is to protect you and to stop other people from hurting you. So there is something like a police force. The army, which is an institution, is federal; but there’s such a thing as a militia, a guard, which is of the state; then, there is the police force of the city. In Shakespeare’s Much Ado about Nothing we have a constable, one of the funniest people ever, Dogberry. But he is part of an institution: the police. —So, an institution that is a phase of the big one, the government, is the police.

The family is an institution that is usually the result of another institution, though it need not be—the result of an institution that has been with people from the very beginning: marriage. Marriage has been questioned and has been evaded, has been yearned for, and not had, but it exists. Something like marriage is in nearly every country of the world. Something like marriage is present with what have been called primitive people. Marriage is essentially an activity, and is a relation between two people which a state takes account of. A family can result, and that is a more static institution compared to marriage.

There Are Education & Property

One of the things a government provides, particularly state government in America, is education. For a long while education was private. If a person was to be educated, he’d find a tutor. But education nearly everywhere in the world is an institution of government. It still can be private, and if something is private yet goes along constantly, it can be called an institution. That depends on its permanence.

There are two things a government protects. One is your life, your well-being; the other is your property. So property, as such, is an institution. It does have something to do with America, certainly, but it has something to do, as I said, with every other country, because in every country there is some idea of property. Napoleon, while fighting his wars, worked at the Civil Code, or Napoleonic Code, and there is a great deal in it about inheritance and who owns property and how property is to be transferred.

Every state has had to take account of who owns what. Every property in New York is recorded in the Office of the City Register. It’s been that way for a long time. As soon as land was taken, somebody had to say This belongs to you.

These are institutions. They have to do with the way everything is owned, and that is what is changing now.

There has to be money, because a government that can’t coin money is hardly a government. So the symbol of wealth that is money is governmental. Banks are so necessary that they are sometimes called institutions because, for one thing, they’re concerned with that which the government mints, money. “Banking institution” is a phrase that’s been heard. But whenever the word institution is used, it’s important to see how it’s used. I remember when people would say about Babe Ruth, “He’s not just a baseball player—he’s a baseball institution.” There’s something permanent about it.

The Beginning of Government

As soon as five people meet, even if they don’t speak a word, they have to come to some arrangement, and the awareness of people by each other is the beginning of government. We can find that in Rousseau’s Social Contract.

The next institution, which is in process, is the church. The church can be seen as an institution, and we find the church and the state sometimes sharing powers in marriage.

Then there’s the matter of health. For a long time, the state or government was not interested in health. It was because of the yellow fever epidemic that there was a Board of Health in New York. But the need to keep things clean was always around, and every village had to tell the villagers not to throw things from windows. You can’t say health is an institution, but health has become related to an institution. There is now a tremendous interest in health.

Democracy is not usually called an institution. But one phase of democracy, the elective system, or elections, is seen as an institution. And that is in question now.

Then there is welfare, and that’s a new institution. The feeling is that if a person is sick and can’t work, or can’t work for any reason, can’t find a job and she or he has children, this becomes something the state should look into, and not just private social workers.

Then there is the job, which is a very big one, of taking care of the people who have offended society. These people are usually called criminals. And sometimes the criminals are very highly placed. In other words, the great lesson of Watergate is: no matter how high you are in government, the clink is waiting for you. Well, the penal system, which is a big subject in its own right, is an institution.

The government needs to have money, so there is taxation. And taxation can be called an institution.

Then, the government has foreign relations and must protect itself from enemies. At first we had chiefly one thing: the army. But there were developments, and it was found (for instance) that a navy was needed.

Mainly, however, I’ve been presenting those things most people would agree on—that these are institutions. And to every institution, somebody can say “Down with.”

The most terrible thing in the use of the word institution in America was that the South considered slavery an institution. They described it as such: it was called their “peculiar institution” (with peculiar meaning particular, one’s own). Travelers to America would remark on it with horror—there was this “institution” of slavery!!

The Most Important Statement

The most important statement about institutions is in Abraham Lincoln’s First Inaugural, March 4, 1861. And it’s one of the most radical statements that anybody has ever made:

This country, with its institutions, belongs to the people who inhabit it.

That is Lincoln. It’s toward the end of the First Inaugural.