Vilfredo Pareto: the Person and his thought
The Marquis Vilfredo Frederico Damaso Pareto was born in Paris on July 15, 1848. His father, the Marquis Raphael Pareto, came of an old Genovese family that had been ennobled in the eighteenth century. While still a young man, Raphael Pareto had fled Italy and moved to France in the eighteen thirties. Holding republican opinions and adhering to the libertarian cause of Mazzini, he had been persecuted by the House of Savoy, which had annexed Genova in 1815. While in exile, he married a Frenchwoman, Marie Metenier, and all his children, two daughters and the boy Vilfredo, were born in France. In Paris, Raphael Pareto worked as a civil engineer; shortly before the birth of his son he began the necessary formalities to become a naturalized French citizen. He decided, however, to return to Italy in 1855, and so his son, although bilingual, was educated in that country.
Pareto received a solid classical education in the very demanding Italian secondary school system and then proceeded to the Turin Polytechnical School to become a civil engineer like his father, who was by then a high-ranking member of the Piedmontese civil service. The five-year course in civil engineer- ing, the first two years of which were devoted to mathematics, deeply in- fluenced Pareto’s future intellectual outlook. In 1870 he graduated with a thesis on “The Fundamental Principles of Equilibrium in Solid Bodies.” His later interest in equilibrium analysis in economics and sociology is prefigured in this thesis.
Pareto as Businessman and Spurned Politician
After leaving school, Pareto decided to take up a business career. He served for a time as the director of the Rome Railway Company and then be- came managing director of an iron-products company based in Florence. In these early years of his career, Pareto frequented aristocratic salons and moved in the circles of the high bourgeoisie, but, following in his father’s footsteps, he expressed fervently democratic, republican, and even pacifist sentiments. These sentiments were soon to change and the son later violently rejected the ideals that had imbued his father.
In 1876, the free-trading rightist regime that had run Italy fell from power. There followed a long period in which the moderate left parties dominated Italy’s political scene; they moved away from free trade, pursued an economic policy of protectionism, and led Italy into military adventures abroad. Pareto soon became a violent opponent of the political regime, the so- called transformism, and attacked it in a series of newspaper blasts. His changed orientation can be accounted for by his principled stand in favor of free trade and against government intervention, as well as the distasteful neces- sity to make “deals” with influential deputies and government agents in his capacity as company director. In 1882 he ran as an opposition candidate for a Florence constituency but was beaten by the government-supported candidate. Increasingly bitter about the current state of affairs, he now saw in the new ruling elite of Italy a band of corrupt, contemptible, and self-serving careerists who used the levers of government to enrich themselves and to buy political success through economic favors in rigged elections.
Pareto’s father died in 1882, and when his mother died a few years later, Pareto decided to change his whole style of life. He gave up his directorship in 1889, married Alessandrina Bakunin, a young, impoverished Russian girl from Venice, and moved from Florence to semiretirement in a villa at Fiesole, where he diverted himself with translations from the classics, read avidly in six or seven languages, and turned to a serious study of economics. No longer encumbered by managerial obligations, Pareto continued his fierce crusade against the government’s foreign and domestic policies in the name of free trade and old-fashioned liberalism. Between 1889 and 1893 he wrote no less than 167 articles, mostly violent and vituperative antigovernment polemics, but some of them of a more scholarly cast.
Pareto now turned against the Mazzinian ideals of his father. His demo- cratic faith in the virtues of the people was shattered and he developed that cynical contempt for humanitarianism, republicanism, and progress that was to characterize his views until the end of his days. Like a lover spurned, he turned against the Italian political system that rejected his advice and wallowed, so he felt, in a mire of corruption.
During the years of his semiretirement, Pareto cultivated relations with a number of Italian economists and publicists of liberal persuasion who shared his free trade, Manchesterian principles. Somewhat earlier he had joined the Adam Smith Society in Florence, which was founded by Francesco Ferrara and included in its membership such other liberal economists as De Johannis and Martello. One of its members, Maffeo Pantaleoni, a leading liberal econ- omist, became his close friend and acquainted him with the mathematical equilibrium system in economics then elaborated by Leon Walras, the pro- fessor of political economy at Lausanne. From then on, Pareto contributed articles of economic theory, reflecting the Walras viewpoint, to a number of learned journals in Italy and France.
A Belated Academic Career
In June 1891, Pantaleoni introduced Pareto to Walras with the words, “He is an engineer like you; he is an economist not like you, but wishing to be- come like you, if you help him.” Walras became seriously ill soon after this encounter, and when he was forced to give up his teaching, Pantaleoni per- suaded him to propose that Pareto be chosen as his successor. In April 1893 Pareto moved to the University of Lausanne as an “extraordinary professor” of political economy. His appointment was made permanent a year later. He was then in his middle forties.
In Lausanne, Pareto at first continued to write his critical monthly chron- icle for the Giornale degli Economisti , in which he pursued his anti-interven- tionist and anti-protectionist critique of the hated Italian government and the wheelers and dealers who remained in the political saddle. But his theoretical work now assumed more importance. His two-volume Cours d’e’conomie poli- tique , based on his lectures at the university, appeared only three years after he had arrived there and established him as a major figure in modern eco- nomics, a true heir of Walras.
In his early Lausanne period, Pareto still considered himself a man of the liberal left. He provided shelter for many socialist and leftist refugees who had to flee Italy after the 1898 May Riots at Milan, and he passionately took the side of Dreyfus when the Affair broke out in neighboring France. But after 1898, Pareto’s views changed sharply and decisively. He gave up hope of a liberal restructuring of Italian economic affairs and turned violently against any form of democratic thought; this almost pathological hatred for the ideas of the left would mar all his subsequent writings. In 1900, he wrote to Panta- leoni that there had once been a time when he wanted to correct the evils of the halt but now he derided their infirmity. He turned away from any re- forming endeavors, resolving to comment on the passing scene with the de- tachment that comes from distance, but also from loathing. Already in 1891 he had written to Walras, “I give up the combat in defense of [liberal] economic theories in Italy. My friends and I get nowhere and lose our time; this time is much more fruitfully devoted to scientific study.” Pareto became a cynical, rancorous, utterly disillusioned loner, at variance with all the dominant tendencies of the age, hating all of them without discrimination.
Pareto’s misanthropic predisposition and lack of faith in humanity were presumably increased when, after returning from a trip to Paris, he found that his wife had absconded with the cook, taking thirty cases of valuables with her. Being still an Italian citizen, though now living in Switzerland, Pareto could not secure a divorce under canon law. All that could be arranged was a separation of bed and board.
Having acquired a very considerable legacy in 1898 after the death of an uncle, Pareto was financially independent and could order his life in a way that his academic salary would not have allowed him. He built himself a house at Celigny near Lausanne, but in the canton of Geneva where taxes were lower than in Lausanne. Here he was joined by a new companion, Jane Regis, who took care of him and of the vast number of Angora cats he liked to have constantly around him. Leading a somewhat sybaritic existence in his retreat, tasting only the choicest wines and the finest viands, Pareto continued his scientific work. In 1902 he published his Les Systemes socialistes , a detailed analysis and criticism of socialist doctrine and state interventionism. He was still a free-trader, but he now had given up all hope of influencing political events and felt that he could limit himself to pointing out what he considered the logical fallacies and disastrous results of socialist policy. The book seethes with irony and boiling rage, even though its author advertised it as an exercise in scientific analysis.
Before writing the Systemes socialistes , Pareto had already been struck by the idea that most of human activity was not controlled by rational thought but by sentiments, feelings, superstitions, and other nonlogical determinants. This was why, so he now thought, his long campaign in favor of economic liberalism had failed; rational argument could never move the mass of men who were governed by nonrational beliefs. This new view was first presented in a long article for the Rivista Italiana di Sociologica in 1900 and informs much of his writings on socialism. It came to fruition in the Manual of Politi- cal Economy, which he published in 1906, and was fully elaborated in his monumental million-word Treatise on General Sociology (1916), translated into English as The Mind and Society , for which he is chiefly remembered among sociologists.
During this last period of his life, Pareto, suffering from a heart disease, lived as a recluse in his Villa Angora. He had retired from regular university teaching in 1907, though he continued to give lectures on sociology there on an irregular basis. Surrounded by his cats, boasting of a cave full of the most re- nowned wines of all Europe, and of an immense cupboard containing liqueurs from all five continents, Pareto concentrated on his scientific work–and on his hatreds. Suffering from insomnia, he browsed in his encyclopedic library till late at night, after having partaken of the pleasures of the table.
When Mussolini came to power in the last year of Pareto’s life, he pro- claimed himself a disciple of Pareto and showered him with honors. (Once while living as an exile in Switzerland, Mussolini had registered in two of Pareto’s courses at Lausanne, though it is doubtful that he ever attended them with any regularity.) Pareto was made a Senator of the Kingdom of Italy, des- ignated an Italian delegate to the Disarmament Conference at Geneva, and was invited to become a contributor to Mussolini’s personal periodical, Gerarchia. Pareto welcomed fascism, although with reservations, but he never served for reasons of ill health. In the first years of his rule, Mussolini seemed indeed to implement the program Pareto had advocated for so long. He destroyed liberalism and the workers’ movement, but at the same time pursued a liberal economic policy by replacing state management with private enterprise. He decreed, as Borkenau says, “a religious education in dogmas, which he did not himself believe in.”
Many fascist spokesmen later claimed that Pareto was one of the chief sources of their ideology. Mussolini characterized Pareto’s theory of the elite as “probably the most extraordinary sociological conception of modern times.” There is no doubt that the fascists could draw much sustenance from Pareto’s writings. Yet, when Mussolini muzzled the universities of Italy and restricted free speech, Pareto protested vehemently. Had Pareto lived it is unlikely that he would have endorsed the complete suppression of liberties during the later stages of Mussolini’s regime, or that he would have looked with favor on the state-interventionist course of the fully matured fascist regime.
Pareto saw only the beginning of Mussolini’s rule. Early in 1923, when he felt that his end was near, he finally managed to marry Jane Regis by becom- ing a citizen of the city-state of Fiume, where divorce was legal. He died on August 19, 1923, at the age of seventy-five, after a short illness. He is buried in the cemetery of Celigny, where his tomb carries the simple inscription,”Vil- fredo Pareto (1848-1923).” He had been born in 1848, the year of the great liberal revolution, and he died within a year after Mussolini’s March on Rome.
Toward the end of his life Pareto wrote:
Driven by the desire to bring an indispensable complement to the studies of political economy and inspired by the example of the natural sciences, I determined to begin my Treatise, the sole purpose of which–I say sole and I insist upon the point–is to seek experimental reality, by the application to the social sciences of the methods which have proved themselves in physics, in chemistry, in astronomy, in biology, and in other such sciences.
In this statement Pareto summarized his aim in writing his major sociological work, The Treatise on General Sociology.
Pareto’s ambition was to construct a system of sociology analogous in its essential features to the generalized physico-chemical system which J. Willard Gibbs formulated in his Thermodynamics. A physico-chemical system is an isolated aggregate of individual components such as water and alcohol. The factors characterizing the system are interdependent so that a change in one part of the system leads to adjustive changes in its other parts. Pareto had a similar conception of the social system, in which the “molecules” were indi viduals with interests, drives, and sentiments “analogous to the mixtures of chemical compounds found in nature.” Pareto’s general sociology sets forth the concept of social system as a framework for analyzing mutually dependent variations among a number of variables determining human conduct.
The treatise does not attempt to cover all the variables that are part of the social system. Only nonrational aspects of action are considered in any detail. Pareto’s interest in sociology arose out of his previous concern with economics and out of his realization that the variables with which economics operated were insufficient to account for much, if not most, of human behavior. The field of economics, he reasoned, especially in its modern form, had limited itself to a single aspect of human action: rational or logical action in pursuit of the acquisition of scarce resources. Pareto turned to sociology when he became con- vinced that human affairs were largely guided by nonlogical, nonrational actions, which were excluded from consideration by the economists. For this reason he attempts in his Treatise to understand the nonrational aspects of human behavior, omitting almost completely the rational aspects which he considered to be treated adequately in his economic writings.
Pareto searched for a rational accounting of the prevalence of human ir- rationality. He did not intend to discard economic theory, in the manner of Veblen, but rather to supplement its abstractions with sociological and social- psychological concepts that would help toward an understanding of those aspects of human conduct that had proved recalcitrant to economic analysis. It is this analytical distinction between rational and nonrational elements of action and not a classification of concrete behavior that Pareto aimed at: “It is not actions as we find them in the concrete that we are called upon to classify, but the elements constituting them.”
Logical and Nonlogical Action
Pareto defines logical actions as those “that use means appropriate to ends and which logically link means with ends.” This logical conjunction of means with ends must hold not only for the subject performing them, “but [also] from the standpoint of other persons who have a more extensive knowledge.” Logical actions are those actions that are both subjectively and objectively logi- cal. Nonlogical action is simply taken to mean all action not falling within Pareto’s explicit definition of the logical; it is a residual category.
Pareto follows what he sees as an inductive procedure in developing his conceptual framework for the analysis of the nonlogical element in human action. After considering a wide array of cases in both past and contemporary history, and taking as his evidence many types of ideologies–beliefs and doc- trines that have allegedly moved men to action–Pareto concluded that these nonscientific belief systems and theories were only rarely determinants of action but instead were most frequently the expression of deep-seated sentiments. Pareto argued that although men most often fail to engage in logical action, they have a strong tendency to “logicalize” their behavior, that is, to make it appear as the logical result of a set of ideas. In fact, what accounts for most action is not the set of beliefs that is used to rationalize or “logicalize” it, but rather a pre-existing state of mind, a basic human sentiment. For example, a man has a horror of murder. Therefore, he will not commit murder. He tells himself, however, that “the Gods punish murderers” and imagines that this is why he refrains from murder. If we designate human sentiments, the basic Sources of nonlogical action, as A, the theories relating to action as B, and action itself as C, we realize that, although A, B, and C are mutually inter- related, A independently influences B and C far more than B influences C. To think otherwise, Pareto argues, is to fall into the rationalistic fallacy that has been the bane of most previous social theory.
Whereas B and C, nonlogical theories and overt acts respectively, are directly observable, human sentiments or states of mind can only be inferred. Pareto was not prepared to analyze these basic sentiments, but left this task to psychologists. “Nonlogical actions originate chiefly in definite psychic states, sentiments, subconscious feelings, and the like. It is the province of psychology to investigate such psychic states. Here we start with them as data of fact, without going beyond that.”
Pareto concentrated his attention on conduct that reflects these psychic states, and, more particularly, the theories and belief systems that serve to justify and rationalize nonlogical action. One of his central concerns is with an exhaustive critique of nonscientific theories associated with action. He sub- mits metaphysical, religious, and moral systems to a destructive analysis and shows to his own satisfaction that all of them, despite their pretensions to the contrary, have nothing at all in common with scientific theories. Notions such as “liberty,” “equality,” “progress,” or “the General Will” are as vacuous as the myths and magical incantations with which savages rationalize their actions. None is verifiable, all are fictions that serve mainly to clothe and make re- spectable the actions of men. Even though Pareto does not deny that such myths may upon occasion influence conduct, he mainly highlights those in- stances in which they serve merely as masks. He sees unmasking as one of the main tasks of the social analyst. “We have to see to what extent reality is disfigured in the theories and descriptions of it that one finds in the literature of thought. We have an image in a curved mirror; our problem is to discover the form of the object so altered by refraction.” As will become clear later, such unmasking served Pareto’s ideological purposes and not only his scientific aims.
Residues and Derivations
Pareto’s attempt to unmask nonscientific theories and belief systems led him to make a distinction between changing elements accounting for these theories, which he termed derivations, and residual, relatively permanent ele- ments, which he termed residues. The notion of residues has often been mis- understood as merely a fancy term for instinct and as corresponding to the basic sentiments discussed earlier. Pareto himself brought forth this misunder- standing by occasionally referring to residues as instincts. It seems nevertheless that he conceived of residues as manifestations of sentiments or as correspond- ing to them, rather than as their equivalents.
Residues are intermediary between the sentiments we cannot know directly and the belief systems and acts that can be known and analyzed. Furthermore, residues are related to man’s instincts but they do not cover all of them, since we can only discover those instincts that give rise to rationalization in theories while others must remain hidden.
The element a [i.e., the residues] corresponds . . . to certain instincts of man . . . and it is probably because of its correspondence to instincts that it is virtually constant in social phenomena. The element b [i.e., the deriva- tions] represents the work of the mind in accounting for a . That is why b is much more variable, as reflecting the imagination. But if the element a cor- responds to certain instincts, it is far from reflecting them all. . . . We analyzed specimens of thinking on the look-out for constant elements. We may therefore have found only the instincts that underlay those reasonings. There was no chance of our meeting along that road instincts which were not so logicalized. Unaccounted for still would be simple appetites, tastes, in- clinations, and in social relationships that very important class called “interests.”
A man’s appetite or taste for, say, pork chops, does not fall into the category of residues in Pareto’s scheme. If, however, a man constructs a theory according to which Chinese cooking is superior to American cooking, then Pareto would be moved to investigate the residues underlying the elaboration of such theoreti- cal justification.
Pareto arrives at his distinctions between residues and derivations by the following procedure: He investigates doctrines that are associated with action, for example, Christian religious doctrine or liberal political theory. From these theories he separates those elements that correspond to the standards of logico- experimental science. Next, he separates the remaining nonscientific elements into constants (residues) and variables (derivations). Derivations only arise when there is reasoning, argument, and ideological justification. When these are present, Paretian analysis looks for the underlying relatively constant ele- ments (residues).
For example, we find in all ages a great variety of verbalizations and doc- trines connected with the sexual sphere. These may take the form of porno- graphic literature or of the denunciation of sexual license. There are strict and permissive theories about proper sexual conduct. Ascetic doctrines condemn what hedonistic doctrines extol. But throughout all these manifold deriva- tions runs a common sexual residue, which remains remarkably stable at all times. Styles, modes, fashions, and ethical theories about the sexual sphere vary immensely, but a uniform sexual nucleus always crops up in a variety of new doctrinal disguises.
A long quotation from the Treatise will convey the characteristic flavor of Pareto’s analytical procedure, and show at the same time how his political passions override in many instances his scientific intent.
The weakness of the humanitarian religion does not lie in the logico- experimental deficiencies of its derivations. From that standpoint they are no better and no worse than the derivations of other religions. But some of these contain residues beneficial to individuals and society, whereas the humanitarian religion is sadly lacking in such residues. But how can a re- ligion that has the good of humanity solely at heart . . . be so destitute in residues correlated with social welfare? . . . The principles from which the humanitarian doctrine is logically derived in no way correspond with the facts. They merely express in objective form a subjective sentiment of as- ceticism. The intent of sincere humanitarians is to do good to society, just as the intent of the child who kills a bird by too much fondling is to do good to the bird. We are not . . . forgetting that humanitarianism has had some socially desirable effects. . . . But . . . humanitarianism is worthless from the logico-experimental point of view. . . . And so for the democratic religion in general. The many varieties of Socialism, Syndicalism, Radicalism, Tolstoyism, pacifism, humanitarianism, Solidarism, and so on, form a sum that may be said to belong to the democratic religion, much as there was a sum of numberless sects in the early days of the Christian religion. We are now witnessing the rise and dominance of the democratic religion just as the men of the first centuries of our era witnessed the rise of the Christian religion and the beginnings of its dominion. The two phenomena present many significant analogies. To get at their substance we have to brush derivations aside and reach down to residues. The social value of both those two religions lies not in the least in their respective theologies, but in the sentiments that they express. As regards determining the social value of Marxism, to know whether Marx’s theory of “surplus value” is false or true is about as important as knowing whether and how baptism eradicates sin in trying to determine the social value of Christianity–and that is of no importance at all.”
The message that Pareto hammers home on many a page of the Treatise is this: Never take ideas at their face value; do not look at people’s mouths but try to probe deeper to the real springs of their actions.
A politician is inspired to champion the theory of “solidarity” by an ambition to obtain money, power, distinctions. . . . If the politician were to say, “Believe in solidarity because if you do it means money for me,” they would get many laughs and few votes. He therefore has to take his stand on principles that are acceptable to his prospective constituents. . . . Oftentimes the person who would persuade others begins by persuading himself; and even if he is moved in the beginning by thoughts of personal advantage, he comes eventually to believe that his real interest is the welfare of others.
Although men have used an infinite number and variety of derivations in order to justify or logicalize their actions, Pareto argues that six classes of residues have remained almost constant throughout the long span of Western history. For this reason he surmises that the major classes of residues correspond closely to certain basic human “instincts” or propensities. The six classes of residues are as follows:
I. Instinct for Combinations. II. Group Persistences (Persistence of Aggregates). III. Need of Expressing Sentiments by External Acts (Activity, Self-Ex- pression) . IV. Residues Connected with Sociality. V. Integrity of the Individual and His Appurtenances. VI. The Sex Residue.
Pareto intends to show that the same residue can give rise to a great variety of belief systems or derivations, and that men deceive themselves when they believe that they take a given course of action on the basis of a particular theory in which they happen to believe. For example, “A Chinese, a Moslem, a Calvinist, a Catholic, a Kantian, a Hegelian, a Materialist, all refrain from stealing; but each gives a different explanation for his conduct.” In view of such variable explanations of a constant characteristic, Pareto concluded that the real cause of the behavior has to be found in the constancy of a residue under- lying these different derivations. He reasoned that all these adherents of different schools of thought have in common the need to maintain the integrity of their personality and to preserve their self-regard. Therefore, Class V residues explain their conduct.
Everywhere, and at all times, men believe in the objective reality of gods or spirits, of “progress,” “freedom,” or “justice.” The names and embodiments of these entities change, as do the religious, philosophical, and moral theories that explain these beliefs. But it will always be found that, however expressed, the common belief in such entities is rooted in a stable common element, in this case residue II, the “conservative” tendency to group persistence, to social integration.
Pareto argued repeatedly that it is useless, even a waste of time, to discuss the truth of a doctrine with an adherent to it. Christianity has not been de- stroyed by arguments disputing the historical reality of Jesus, and Catholic patriotism in France was not hurt by assertions that Joan of Arc was a hys- teric. Only a scientific strategy that allows us to trace the multiplicity of belief systems and doctrines to their common source in basic residues can advance science and lead to a measure of enlightenment.
Whether Pareto’s explanations amount to more than pseudo-explanations is an open question. I would agree with Raymond Aron who believes that they have much in common with the reasoning of Moliere’s quack physician who explains the effects of opium by its dormitive powers. As Aron says with characteristic wit, “One does not dare to say [Pareto’s] results are false, but perhaps they are not very instructive.” Yet before attempting to pass a judg- ment, one has to realize that Pareto’s theory of residues served him not only as a way of explaining theories and belief systems, but also as a means of explaining social movements, social change, and the dynamics of history. Be- fore we turn to this matter, two other Paretian notions, the distinction between types of nonlogical theories, and the distinction between subjective intentions and objective consequences of action need to be examined.
Two Types of Nonlogical Theories
Commentators often have mistakenly assumed that in Pareto’s scheme all nonlogical theories are viewed equally as only reflections or manifestations of underlying propensities. This, however, is not the case. He was careful to dis- tinguish between 1) pseudo-scientific theories and 2) “theories transcending experience.”
In the first, Pareto argued, we deal with theories that pretend to scientific status but demonstrably fail to meet the test of scientific evidence. Such theories, he believed, are ultimately anchored in biological needs, drives, and propensities and are directly explainable in terms of the residues underlying them. They are, in fact, rationalizations. When it comes to “theories transcending experi- ence,” religious theories, for example, Pareto argued differently. These do not pretend to have scientific status; it is pointless, therefore, to show that they depart from scientific standards. Such theories represent, instead, cultural values and the cultural dimension in human action. They are value-attitudes. When Pareto says that residues are “manifested” in pseudo-scientific theories, he seems to mean that these indicate the presence of such residues, and testify to their power of deception. But when he talks about the manifestation of residues, in theories transcending experience, he seems to mean that they are “manifested” or expressed in symbolic ritual behavior.
Pareto was well aware that scientific method could not in itself determine the ends of human action. “A society determined exclusively by ‘reason’ does not and cannot exist . . . because the data of the problem that presumably is to be solved by logico-experimental reasoning are entirely unknown.” Hence, the ends, as distinct from the means, of human action find expression in “theories transcending experience.” To be sure, these can ultimately be traced to the operation of residues, and, in the last analysis, to basic human sentiments; yet Pareto seems to have recognized that the human quest for “meaning” as it manifests itself in “theories transcending experience” must be a basic datum for any analysis of social systems. He did have a power- ful tendency to “reduce” such quests to underlying factors, yet he was also eager to point to the indispensability of symbolic elements for maintaining a social system and for directing the goals of human action. Although his tendency to “debunk” informs a good deal of his work, he was by no means oblivious to the central importance of the normative sphere. This may be the reason he has been quoted to say that he hoped his Treatise would not be read too widely, since this would help undermine necessary moral values.
Subjective Intentions and Objective Consequences
Most of Pareto’s concrete analysis in the bulk of the Treatise is concerned with the springs of action of individual actors. Coming from economics, a discipline that had paid almost exclusive attention to rational action, he was moved to supplement the economists’ system of abstraction with a sociological system emphasizing the nonlogical drives to action. Yet, while focusing most of the time on the actor’s motivations, Pareto was also sensitive to the need for analyzing the objective consequences of conduct. Subjective intentions and ob- jective consequences, he stressed, do not always coincide.
Pareto was especially attentive to those instances in which men engage in what they conceive to be logical actions but which the outside observer sees as having no logical end, or, perhaps more importantly, which he finds culmi- nating in consequences other than those that were pursued by the actors. People believe that by means of certain rites and practices they may quell a storm or bring rain. Objectively we know that natural phenomena cannot be produced in this way; yet it may well be that by engaging in such practices the believers experience a euphoric sense of power that makes them better able to withstand the existential trials and tribulations in which they are involved and strengthens the bonds of the social system in which they participate. In this case, a belief system that is patently false still has a high degree of personal or social utility. More generally, “The experimental truth of a theory and its social utility are different things. A theory that is experimentally true may now be advantageous, now detrimental to society; and the same applies to a theory that is experi- mentally false.” “A theory may be in accord with experience and yet be harm- ful to society, or in disaccord with experience and yet beneficial to society.” The assessment of social utility must proceed apart from the investigation of the logical status of theories and of the subjective intentions of individual actors.
The Lions and the Foxes
In the last part of his Treatise , Pareto attempts to show how the distribu- tion of residues in a population is related not only to its belief systems and intellectual life, but also, and most importantly, to the state of the polity and of the economy. Here Pareto deals only with the first two residues, those of “combinations” and of “persistence.” Residues of the first type impel men to system making, that is, to elaborate pseudo-logical combinations of ideas. Class I residues lead men to manipulate various elements found in experience. They are at the root of magical practices to control, as the case may be, the weather, the course of a disease, or the love of a maiden. At more complex levels, Class I residues lead people to engage in large-scale financial manipulation–to merge, combine, and recombine enterprises. At still more complex levels, they explain the urge of politicians and statesmen to join and fuse political forces, to make political deals, and to build political empires. Men primarily moved by Class I residues are like Machiavelli’s “foxes,” capable of experiment, innova- tion, and departure from common use, but lacking fidelity to principles and to those conservative virtues that insure stability.
The conservative forces of “social inertia” are represented by men in whom the second class of residues (persistence of aggregates) predominate. Such men have powerful feelings of loyalty to family, tribe, city, and nation; they display class solidarity, patriotism, and religious zeal; and they are not afraid of using force when necessary. These are Machiavelli’s “lions.”
In the world of his day, more particularly in Italy and France, Pareto be- lieved that the foxes were in the ascendancy. The political and economic scene was dominated by political wheelers and dealers, by unscrupulous lawyers and intellectual sophists, by speculators and manipulators of men. Pareto’s concern was that if this condition were to remain unchecked, social equilibrium would be fundamentally upset and the social order would totter. Yet he felt that the chances were high that, as had so often happened in the past, men of conser- vatism and persistence would finally rise, sweep the reign of foxes aside, and make sure that stability could again come into its own. Faith, patriotism, and national honor would once again claim the allegiance of all.
After a certain period of time, the foxes will again infiltrate into the seats of government, for their mental skills and expertise cannot be dispensed with for long. They will slowly undermine the certainties that the lions uphold, and their corrosive intelligence will undermine the uncomplicated faith of the militant lions. As a result, the wheel will come full circle and a new age of deceit and manipulation will dawn.
All belief in progress or evolution was for Pareto so much nonsense. Human society was bound to repeat forever the same cycle from rule by lions to rule by foxes and back again. It is characterized by a continually shifting but ultimately unchanging equilibrium. There is nothing new in history; it is only the record of human folly. Utopia is, literally, nowhere.
The Theory of Elites and the Circulation of Elites
It is a basic axiom for Pareto that people are unequal physically, as well as intellectually and morally. In society as a whole, and in any of its particular strata and groupings, some people are more gifted than others. Those who are most capable in any particular grouping are the elite.
Let us assume that in every branch of human activity each individual is given an index which stands as a sign of his capacity, very much the same way grades are given . . . in examinations in school. The highest type of lawyer, for instance, will be given 10. The man who does not get a client will be given 1–reserving zero for the man who is an out-and-out idiot. To the man who has made his millions–honestly or dishonestly as the case may be–we will give 10. To the man who has earned his thousands we will give 6; to such as will just manage to keep out of the poor-house, 1, keeping zero for those who get in. To the woman “in politics” . . . who has managed to infatuate a man of power and play a part in the man’s career, we shall give some higher number such as 8 or 9; to the strumpet who merely satisfies the senses of such a man and exerts no influence on public affairs, we shall give zero. To the clever rascal who knows how to fool people and still keep clear of the penitentiary, we shall give 8, 9, or 10, according to the number of geese he has plucked. . . . To the sneak-thief who snatches a piece of silver from a restaurant table and runs away into the arms of a policeman, we shall give 1.
The term elite has no moral or honorific connotations in Pareto’s usage. It denotes simply “a class of the people who have the highest indices in their branch of activity.” Pareto argues that “It will help if we further divide that [elite] class into two classes: a governing elite, comprising individuals who directly or indirectly play some considerable part in government, and a non- governing elite, comprising the rest.” His main discussion focuses on the governing elite.
There is a basic ambiguity in Pareto’s treatment of the notion of the elite. In some passages, as in the one quoted above, it would appear that those oc- cupying elite positions are, by definition, the most qualified. But there are many other passages where Pareto asserts that people are assigned elite posi- tions by virtue of being so labeled. That is, men assigned elite positions may not have the requisite capabilities, while others not so labeled may have them.
The label “lawyer” is affixed to a man who is supposed to know some- thing about the law and often does, though sometimes again he is an ignora- mus. So the governing elite contains individuals who wear labels appropriate to political offices of a certain altitude–ministers, Senators, Deputies. . . and so on–making the apposite exceptions for those who have found their way into that exalted community without possessing qualities corresponding to the labels they wear. . . . Wealth, family, or social connections also help in many other cases to win the label of the elite in general, or of the govern- ing elite in particular, for persons who otherwise hold no claim upon it.
It would seem that Pareto believed that only in perfectly open societies, those with perfect social mobility, would elite position correlate fully with superior capacity. Only under such conditions would the governing elite, for example, consist of the people most capable of governing. The actual social fact is that obstacles such as inherited wealth, family connections, and the like prevent the free circulation of individuals through the ranks of society, so that those wear- ing an elite label and those possessing highest capacity tend to diverge to greater or lesser degrees.
Given the likelihood of divergencies between ascribed elite position and actual achievement and capacity, Pareto is a passionate advocate of maximum social mobility and of careers open to all. He saw the danger that elite posi- tions that were once occupied by men of real talent would in the course of time be preempted by men devoid of such talent.
In the beginning, military, religious, and commercial aristocracies and plutocracies . . . must have constituted parts of the governing elite and some- times made up the whole of it. The victorious warrior, the prosperous mer- chant, the opulent plutocrat, were men of such parts, each in his own field, as to be superior to the average individual. Under those circumstances the label corresponded to an actual capacity. But as time goes by, considerable, some- times very considerable, differences arise between the capacity and the label. . . . Aristocracies do not last. . . . History is a graveyard of aristocracies. . . . They decay not in numbers only. They decay also in quality, in the sense that they lose their vigor, that there is a decline in the proportions of the residues which enabled them to win their power and hold it. The governing class is restored not only in numbers, but . . . in quality, by families rising from the lower classes and bringing with them the vigor and the proportions of residues necessary for keeping themselves in power. . . . Potent cause of disturbance in the equilibrium is the accumulation of superior elements in the lower classes and, conversely, of inferior elements in the higher classes.
When governing or nongoverning elites attempt to close themselves to the influx of newer and more capable elements from the underlying population, when the circulation of elites is impeded, social equilibrium is upset and the social order will decay. Pareto argued that if the governing elite does not “find ways to assimilate the exceptional individuals who come to the front in the subject classes,” an imbalance is created in the body politic and the body social until this condition is rectified, either through a new opening of chan- nels of mobility or through violent overthrow of an old ineffectual governing elite by a new one that is capable of governing.
Not only are intelligence and aptitudes unequally distributed among the members of society, but the residues as well. Under ordinary circumstances, the “conservative” residues of Class II preponderate in the masses and thus make them submissive. The governing elite, however, if it is to be effective, must consist of individuals who have a strong mixture of both Class I and Class II elements.
A predominance of interests that are primarily industrial and commercial enriches the ruling class in individuals who are shrewd, astute, and well- provided with combination instincts; and divests it of individuals of the sturdy impulsive type. . . . One might guess that if cunning, chicanery, combinations were all there was to government, the dominion of the class in which Class I residues by far predominate would last over a very, very long period. . . . But governing is also a matter of force, and as Class I residues grow stronger and Class II residues weaker, the individuals in power become less and less capable of using force, so that an unstable equilibrium results and revolutions occur. . . . The masses, which are strong in Class II residues, carry them up- wards into the governing class either by gradual infiltration or in sudden spurts through revolutions.
The ideal governing class contains a judicious mixture of lions and foxes, of men capable of decisive and forceful action and of others who are imaginative, innovative, and unscrupulous. When imperfections in the circulation of govern- ing elites prevent the attainment of such judicious mixtures among the govern- ing, regimes either degenerate into hidebound and ossified bureaucracies in- capable of renewal and adaptation, or into weak regimes of squabbling lawyers and rhetoricians incapable of decisive and forceful action. When this happens, the governed will succeed in overthrowing their rulers and new elites will institute a more effective regime.
What applies to political regimes applies to the economic realm as well. In this field, “speculators” are akin to the foxes and “rentiers” to the lions. Speculators and rentiers do not only have different interests but they reflect different temperaments and different residues. Neither is very good at using force, but they both otherwise fall roughly into the same dichotomous classes that explain political fluctuations.
In the speculator group Class I residues predominate, in the rentier group, Class II residues. . . . The two groups perform functions of differing utility in society. The [speculator] group is primarily responsible for change, for economic and social progress. The [rentier] group, instead, is a powerful element in stability, and in many cases counteracts the dangers attending the adventurous capers of the [speculators]. A society in which the [rentiers] al- most exclusively predominate remains stationary and, as it were, crystallized. A society in which [the speculators] predominate lacks stability, lives in a state of shaky equilibrium that may be upset by a slight accident from within or from without.
Like in the governing elite where things work best when both residues of Class I and Class II are represented, so in the economic order maximum effec- tiveness is attained when both rentiers and speculators are present, each pro- viding a balance by checking the excesses of the other. Pareto implies through- out that a judicious mixture in top elites of men with Class I and Class II residues makes for the most stable economic structure, as well as for the most enduring political structure.
Social Utility “Of” And “For” Collectives
In his efforts to highlight those aspects of a social system that are not amenable to economic investigation and hence require complementary analysis on a specifically sociological plane, Pareto was led to make the key distinction between the maximum utility of and the maximum utility for a community. The latter is the point where each individual has attained the maximum pos- sible private satisfaction. The former refers to the maximum utility of the group or society as a whole, not of individuals. Only the second type can be treated by the economist; he can consider only the wants of individuals who are dissimilar and whose satisfactions therefore cannot be added up to yield a measure of the maximum utility for the entire group or society. “In pure economics a community cannot be regarded as a person.” In contrast, in sociology, Pareto argues, “[A community] can be considered, if not as a per- son, at least as a unity.” The maximum utility to a society can be analyzed sociologically, and may not necessarily coincide with the maximum satisfaction of the wants of its individual members. What is more, there may well exist divergencies between utilities accruing to a total social system and maximum satisfactions of sub-groupings, such as social classes. For example, in regard to an increase in population, the utility of the community and the utility for the community may well diverge.
If we think of the utility of the community as regards prestige and mili- tary power, we will find it advisable to increase population to the fairly high limit beyond which the nation would be diminished and its stock decay. But if we think of the maximum utility for the community, we find a limit that is much lower. Then we have to see in what proportions the various social classes profit by the increase in prestige and military power, and in what different proportion they pay for their particular sacrifices.
According to Pareto, the distinction between utility of and utility for a community is often deliberately obfuscated for manipulative purposes by ruling groups who make it appear as if subject individuals or sub-groups would benefit from certain measures when this is in fact by no means the case.
The ruling classes oftentimes show a confusion of a problem of maximum utility of the community and a problem of maximum utility for the com- munity. They [try] to make the “subject” classes believe that there is an in- direct utility which, when properly taken into account, turns the sacrifice re- quired of them into a gain. . . . In reality, in cases such as these, nonlogical impulse can serve to induce the subject classes to forget the maximum of individual utility, and work for the maximum utility of the community, or merely of the ruling classes.
Or, to give another example, maximum wealth may be considered a prime goal for the society as a whole, but this may not coincide with the satisfaction of some of its members and may create great inequalities and major pockets of poverty in the society. Inversely, a state in which the greatest number of individuals attain the maximum of satisfaction may mark a point of societal decay and national decline.
By making his distinction between the utility for and the utility of a com- munity, Pareto moved from classical liberal economics, where it was assumed that total benefits for a community simply involved a sum total of the benefits derived by each individual member (“the greatest happiness of the greatest number”), to a sociological point of view in which society is treated as a total unit and sub-groups or individuals are considered from the viewpoint of their contribution to the overall system as well as in terms of their peculiar wants and desires. System needs and individual or sub-group needs are distinguished.
It must be stressed that what is considered to be of maximum utility to society as a whole in fact involves subjective judgments rather than objective assessments. Those who run the affairs of the society, the governing elite, will determine what benefits the society as a whole needs, and they will decide this in terms of their own interests, desires, values, and beliefs.
Pareto’s thought converged with that of Durkheim. Both rejected utilitarian and individualistic notions and stressed the need to consider the requirements of social systems, qua systems. They diverged, however, insofar as Durkheim believed that system needs could be determined objectively and scientifically, whereas Pareto contended that judgments of such needs derived from the de- sires and propensities, as well as the values and norms of those who were in command.