The Rudolf Steiner Archive

Question: The Key Points appear to be logically self-contained, but the criterion of whether something is realistic or not cannot be found in them.

Rudolf Steiner: It would be particularly good if the friends would speak out more clearly on this point. You must bear in mind that political economy as such is actually a very young form of thinking, hardly a few centuries old, and that in the realm of economic life, everything up to the great utopians has actually taken place more or less instinctively. Nevertheless, these instinctive impulses that people had were something that became reality.

To gain a more precise understanding, consider the following. Today, people often say: What we can think about the economy actually arises from economic class antagonisms, but also from the economic mode of operation, and so on. I don't even want to look at the most extreme view, as Marx and his followers advocate. Even economics teachers who lean more towards the middle-class view speak of the fact that everything actually arises from the economic fundamentals as if by automatic necessity. Nevertheless, when people discuss the individual concrete things, it is the case that the concrete institutions that have come into being to produce today's economic life are nothing other than the results of medieval thinking itself, certainly in connection with the various realities. But just consider what form was given to the Roman concept of property, which was a purely legal category, and what was created economically through this concept. It can be seen that these things were not treated scientifically, but that the legal categories, which were already conceived economically as legal, had a formative effect. Now the mercantilists and so on have come, who were not creative people, who were theoretical people. For example, it may be said that the advisers of Emperor Justinian, who created the Code of the Corpus Juris, were much more creative people than the later teachers of political economy. These people actually created not only a Justinian Code in our present sense, but in the further course of medieval development we see the opposing impulses developing precisely on the basis of what was laid down in this Justinian legislation.

And so we have come to the new era, to people whose thinking is no longer creative in an economic sense, but only contemplative. This contemplation really begins with Ricardo. Take, for example, the law of diminishing returns. This is a law that is just right, but absolutely not in line with reality. For practice will continually show that, if all the factors that Ricardo took into account are taken into account, what he called the law of diminishing returns will indeed follow, but the moment more intensive cultivation techniques are introduced, this law is thwarted. It does not hold true in reality.

Take something else, something more trivial. Take Lassalle's “iron wage law”. I must confess that I feel it is a certain scientific carelessness that one still finds stated that this law has been “overcome”, because things do not prove true. The fact of the matter is this: from Lassalle's way of thinking and from the view that labor can be paid for, nothing more correct can follow than this iron wage law. It is so logically strict that one can say: If one thinks as Lassalle had to think, it is absolutely correct that no one has an interest in giving the worker more wages than are just necessary to enable him to make a living. He will not give him more, of course. But if he gives him less, the worker will wither away, and the one who pays the wages must atone for this. It is basically impossible to get by without theoretically admitting the iron wage law. Even within the proletariat itself, people say: the iron wage law is wrong, because it is not right that in recent decades wages have been maintained at a certain minimum, which would also be their maximum. Yes, but why is Lassalle's iron wage law wrong? If the conditions under which he formulated it had continued – I mean the conditions from 1860 to 1870 – if the economy had continued to be run under the purely liberalistic view, the iron wage law would have become reality with absolute correctness. This did not happen. A reversal of the liberalist economy took place and today the iron wage law is constantly being amended by making state laws that effect a correction of reality that would have emerged from the law.

So you see, a law can be right and yet not in line with reality. I don't know of anyone who was a greater thinker than Lassalle. He was just very one-sided. He was a very consistent thinker.

When you are confronted with a law of nature, you can see it. When you are confronted with a social law, you can also see it, but it is only valid as a certain current, and you can correct it. Insofar as our economy is based purely on free competition – and there is still a lot that is based only on free competition – the iron wage law is valid. But because it would be valid under these conditions, there must be corrections with social legislation, with a certain working hours and so on. If you give entrepreneurs a completely free hand, the iron wage law applies. Therefore, there can be no purely deductive method in economics. The inductive method is of no help at all. It has followed Zyjo Brentano. We can only observe the economic facts – she says – and then gradually ascend to the law. – Yes, we don't come to any creative thinking at all. This is the so-called newer political economy, which calls itself scientific. It actually just wants to be inductive. But you won't get anywhere with it.

In economics, you absolutely need a characterizing method that seeks to gain the concepts by starting from different points, holding them together, and allowing them to culminate in concepts. This gives you a specific concept. Since you can never see the full range of facts, but only have a certain amount of experience, it will probably be one-sided in a sense. Now go through the phenomena again with the concept and try to verify it. You will see that this is actually a modification. In this way, by characterizing, you arrive at a concept that you modify by verifying, and you then arrive at an economic view. You must work towards views.

I would now like to work out such a conception in the lectures of the National Economy Course by showing you what always intervenes in the formation of prices. The method in economics is a highly uncomfortable method because in reality it amounts to the fact that one must compose the concepts out of an infinite number of factors. They must work towards economic imaginations! Only with these can you make progress. When you have them and they come into contact with something, they modify themselves, whereas it is not easy to modify a fixed concept.

You know what is known as Gresham's Law: good money is chased away by bad. If bad, under-value money, money minted at below its face value, is in circulation somewhere, it drives out money with good fineness, and that then migrates to other countries. This law is also an inductive law, it is purely an empirical law. But this law is such that one must also say: It is valid only as long as one is unable to secure the significance of money. The moment you are able, through entrepreneurial spirit, to secure the right of money, it would be modified. It would not die out completely. There is no economic law that is not valid up to a certain point; but they are all modified. That is why we need the characterizing method. In natural science, we have the inductive method, which at most comes up to deductions. But in general, deductions are much less important in natural science than one might think. Only induction is of real significance here.

Then you have pure deductions, which are found in jurisprudence, for example. If you want to proceed inductively, you introduce something into jurisprudence that destroys it. If you introduce the psychological method into jurisprudence, you dissolve jurisprudence. In that case, every human being must be declared innocent. Perhaps these methods can be introduced into reality, but then they will lead to the undermining of the legal concept that exists. So it may well be justified, but it is no longer jurisprudence.

In economics, you cannot get by with deduction and induction. You could only get by with deduction if it were possible to give general rules to which reality itself would yield the cases. I will mention only those who want to proceed purely deductively, albeit with a main induction at the beginning. Oppenheimer, for example, puts a main induction of history at the top with his settlement cooperatives and deduces an entire social order from it. Well, many years ago, Oppenheimer was already the settlement man and said: Now that I have got the capital, we will establish the modern cultural colony! – I replied: Doctor, we will talk about it when it has been destroyed. It had to fail because it is impossible, within the general economy, to establish a small area that would enjoy its advantages through something else, so that it would be a parasite within the whole economic body. Such enterprises are always parasites. Until they have eaten enough from the others, they remain - but then they perish.

Thus, in economics, you can only characterize by thinking your way into the phenomena. This also arises from the cause, because in economics, one must continually work into the future on the basis of the past. And as one works into the future, human individualities with their abilities come into play, so that basically, in economics, one can do nothing but stand on the quivive. If one intervenes in practice, then one must be prepared to continually modify one's concepts. One is not dealing with substance that can be plastically formed, but with living human beings. And that is what makes political economy a special kind of science, because it must be imbued with reality.

Theoretically, you will easily be able to see this. You will say: It is then extremely inconvenient to work in economics. But I do not even want to accept that. Under certain circumstances, as long as you still stand on the point of view that you want to write dissertations, for example, you can gain a great deal by following the relevant literature of recent times on some subject and by comparing the individual views. Particularly in economics, there are the most incredible definitions. So just try to compile the definitions of capital from the various economics textbooks or even larger treatises! Try to put them in a row, eight or ten of them! One comes to mind right now: “Capital is the sum of the produced means of production.” I have to say, I don't understand why the adjective is there. The opposite: unproduced means of production – you could also think of something under that, for example, nature, so the soil, and that is what the person in question will mean. But then, of course, he is unable to somehow justify how the soil can be capitalized after all. It is capitalized after all. So there is actually no way out, and that is based on the fact that one has such concepts, one must seek them out and must try to somehow enrich them. The concepts are all too narrow.

If you think that the realistic will be difficult for you in these considerations, I would like to say: the realistic could actually be easy! You say that the “key points” are logically self-contained. They are not, neither the “key points” nor the other things! I must emphasize that I did not want to be purely economic, but social and economic. This, of course, conditions the whole style and attitude of these writings, so that they cannot be judged purely economically. At the most, only individual essays in the three-folding writings can be judged in this way. But I certainly do not find them logically self-contained, because I was careful enough to give only guidelines and examples or, in fact, only illustrations. I wanted to create an awareness of what can be achieved by someone managing a means of production only for as long as they can be present; then it must be handed over to someone who can manage it themselves. I can well imagine that what is to be achieved in this way could be achieved in a different way. I just wanted to give guidelines. I wanted to show that a way out can be found if this threefold structure is properly implemented, if spiritual life as such is actually liberated, if the legal system is placed on a democratic basis, and if economic life is based on the factual and technical, which can be represented in the associations. And I am convinced that in the economic sphere, the right thing will happen.

I say that the people who are in the association will find the right thing. I want to count on people, and that is the realistic thing to do. A treatise on the “concept of work” would have to be written in such a way that you really find the concept of work in the economic sense. This concept must be freed of everything about work that does not create value, and not just economic value. So that must be eliminated first. Of course, this only leads to one characteristic. And it is this characterizing method that is important. Of course, this must be said methodologically.

Question: To what extent is inspiration necessary for economic knowledge?

Rudolf Steiner: What is meant is that this inspiration, if one takes the matter seriously, is actually not that extraordinarily difficult. It is not a matter of finding supersensible facts, but of making inspiration effective in the economic field, so that it cannot be particularly difficult.

The way in which labor is limited would require me to show that a person can perform work without it having economic value. That is a truism. A person can exert himself terribly with talking, and yet no real economic value comes of it. Then I would show how labor, even when it begins to have an economic significance, is modified in its value. Let us assume that someone is a woodchopper and performs a labor that actually creates value, and someone is a cotton agent, has nothing to do with woodchopping, but gets nervous just from his work, so that every summer he spends a fortnight chopping wood in the mountains. Here the matter becomes more complicated, because the agent will certainly be able to utilize the chopped wood, and he will receive something for it. But you must not evaluate what he receives in the same way as you evaluate the woodcutter's work. You must assume that if he does not chop wood for 14 days in summer, he can work far less as an agent in winter. In this case, you have to consider the support he receives from this work. The economic value of the wood chopped by the cotton agent is the same as the value of the wood chopped by the woodchopper; but the economic effect of his work, which falls back on his activity, is now essentially different.

If the value of the agent's chopping wood lies in the fact that it has an effect on his agency, then I have to investigate whether it is also true where someone stands on a treadwheel and climbs from one step to another, thereby making himself thinner. This is an effort for him, but there is no effect on the national economy. It is true, but I have to distinguish here whether the person in question is a rentier or an entrepreneur. The latter becomes more efficient as an economic value creator.

You have to gradually work out the matter in a characterizing way and then, if you go on and on and on, you get a direct value of the work and an indirect, reflective value of the work. In this way you arrive at a characteristic of the concept of labor. With this you can go back again to the ordinary woodchopper and compare what the woodchopping of the cotton agent means in the economic process with that of the professional woodchopper. In this way you can go from one level to another and you have to look everywhere to see how the concept works. That is what I call realistic. They have to show how the work is realized in the most diverse areas of life. Like Goethe with the concept of the primal plant: he of course drew a diagram, but meant a continually changing one. Economic concepts must be subjected to constant metamorphoses in life. That is what I mean.

Of course, you won't have much luck with such concepts. Teachers today do not accept this; they want a definition. But I have not found that the concept of work has been clearly defined in economics. One should characterize it, not constantly speak negatively about it. In economic debates, for example, I have found that work cannot be decisive for the price because it varies among individuals according to their personal strength. Negative instances can be found. But the positive is missing, that one advances to characterizing work in such a way that it actually loses its original substantial character and gets its value from other positions in which it is placed. When one begins to characterize in this way, then the substance is lost; in the end one gets something that plays entirely within the economic structure.

Labor is the economic element that originally arises from real human effort, but which flows into the economic process and thereby acquires the most diverse economic value in the most diverse directions. One should speak of the processes that lead to the evaluation of labor in the most diverse directions.

Inspiration is based on the fact that one comes up with how to progress from one to the other. It depends a little on the spirit that one finds just the right examples.

Question: Isn't a generic term necessary after all? Even with the characterizing method, isn't there a need to place emphasis on the causes by which the observed effects came about?

Rudolf Steiner: As far as the matter of effects is concerned, I agree that one must return to the causes. But just as in certain fields of nature it is the case that one finds the causes only by starting from the effects, so it is even more the case in the field of economics that knowledge of the causes is of no help if it is not gained from the effects. For example, the tremendous effects of a war economy are there. If one did not know them as effects, one would not evaluate the cause at all. It is therefore important to acquire a certain sense of the quality of the effects in order to be able to ascend to the causes. Certainly, in practice one will have to ascend to the causes. But that is what economics is based on for the practical. You learn to evaluate the effects, and by seeing the aberrations of the effects, you come to know the causes and then improve the causes. It is of little use to just get to know the causes. You have to get to the causes in such a way that you can say: I know them by starting from the effects. - An insight of such tremendous significance as the language center in the left hemisphere is, is only recognized from the effects: lost language - left hemisphere paralyzed. You first recognize the effect. Then you are led to examine the matter at all. So this recursive method is necessary.

Question: I cannot look at everything from an economic point of view that has to do with art and religion or even sport. Some of it can be viewed from an economic point of view, but not the whole?

Rudolf Steiner: I drive through an area and find extraordinarily artistic buildings in this area - I am, of course, describing an utopia. This is not just an artistic view. These artistic buildings are only possible on the basis of a very specific economic situation. If I drive through an area where there are a great many art buildings, I will immediately get an idea of how it is managed. If, on the other hand, I drive through an area where even so-called beautiful buildings are tasteless, I will get an idea of the economic situation of the area in question. And if I find only utilitarian buildings, I will get an idea of the economic situation of the area in question. Where I find artistic buildings, I can conclude that higher wages are paid there than where I find no artistic buildings. I cannot imagine that anything could be considered uneconomical. Everything, even the most exalted things, must be considered economically. If an angel were to descend to earth today, he would either have to appear in a dream, in which case he would change nothing; but as soon as he appears to people while they are awake, he would intervene in economic life. He cannot do otherwise.

Objection: I admit that it can be viewed from an economic point of view – but only if you want to! But it can also be viewed from other points of view.

Rudolf Steiner: You are entering a circle. All that can be said is that it is necessary to base the consideration on the economic point of view for the time being. This has only a heuristic value, a value of research and investigation. But if you want to find an exhaustive, realistic political economy, you will not be able to avoid characterizing the economic effects from all sides. You have to characterize what influence it has on the economic life of an area, whether it has a hundred excellent painters or only ten. Otherwise it is hard to imagine that economic life can be encompassed. Otherwise I would not have insisted so strongly on this emphasis. Precisely by emphasizing it, you always end up with definitions that basically do not apply in some area, or that have to be stretched to breaking point. It is actually impossible to define the income that a person should have by pointing out, for example, that he is entitled to “what he produces himself”. There is even this definition: someone is entitled to what he produces himself. It seems quite nice to make such a definition. In a certain field it is correct. But the sewer cleaner could not do much with it. The point is that in economics one should not single out one phenomenon from the sum total of phenomena, but should go through the whole sum. One must be aware: I start thinking economically because I can help those who cannot do so. But one must also be aware that economic thinking must claim to be quite total, to be a very comprehensive kind of thinking. It is much easier to think in legal terms. Most economists think in very legal terms.

Question: Opinions on what is “normal” in economics are so divergent that it is impossible to know what is normal?

Rudolf Steiner: I have no desire to compete with these notions of “normal” and “abnormal”. There is a saying: there is only one health and countless illnesses. - I do not recognize that. Every person is healthy in their own way. People come and say: There is a heart patient who has this and that little defect, which should be cured. - I have often said: Leave the little defect to the person. — A doctor brought me a patient who had injured his nasal bone so badly that he now has a narrowed nasal passage and gets so little air. The doctor said, “That needs an operation, it's a terribly simple operation.” I said, “Don't do the operation!” He has a lung that is so constructed that he is not allowed to get more air; it is fortunate for him that he has a narrowed nasal passage. So he can live another ten years. If he had a normal nose, he would certainly be dead in three years. So I don't attach much importance to 'normal' and 'abnormal'. I only understand the most trivial things by them. I very often say: a normal citizen. Then people will understand what I mean.

The question is asked about the value of statistics.

Rudolf Steiner: It is true that statistics can be of great help. But the statistical method is applied externally today. Someone compiles a statistic about the increase in house values in a certain area and then about those in another area, and puts them side by side. But that is not good. It only becomes reliable when the processes themselves are examined. Then we shall know how to evaluate such a figure. For there may come a time when a series of figures is special simply because an extraordinary event has occurred in the series. ...

Question: Does inspiration also occur when collecting numbers?

Rudolf Steiner: Inspiration also occurs in that when you have a series, a second series, a third, then you find out - now again through the spirit - which facts, if you look at them qualitatively, are modified in the first series by corresponding facts, say in the third series. As a result, certain numerical values may cancel each other out. In the historical method, I call this the symptomatological consideration. One must have the possibility to evaluate the facts and, if necessary, to weigh the contradictory facts correctly against each other.

Economics in particular is sometimes practiced in an extremely unobjective way. One has the feeling that statistics are handled in such a way that, for example, the balance sheets of the finance ministers of the various countries are drawn up from a party-political point of view. Where one wants to prove a certain party line, the numerical data is actually used, which can just as easily prove another. There is no use other than to be impartial in one's soul. Something elementary and original comes into consideration. In all the science that deals with the human being - yes, even if you want to list a science that leads you to learn how to treat animals, to tame them - your concepts must prove to be modifiable. And this is even more true in economics. That is where inspiration comes in. You have to have that. Don't hold it against me if I say it dryly.

I am convinced that many more of today's students would have this inspiration – for it is not something that floats terribly in nebulous mystical heights – if it were not actually expelled from them at school, even at grammar school and secondary school. We have the task today, when we are at university, to remember what was driven out of us at grammar school in order to enter into a living practice of science. Today it is practiced terribly dead. It happened to me in a foreign country that I spoke with a number of economics lecturers. They said: When we want to visit our colleagues in Germany, they say: Yes, come, but not to my lecture, visit me at home! - Today one really needs an unbiased insight into these things. ... This economics has particularly declined recently. It is really all connected with the fact that people have lost this creativity of the spiritual. Today, people really have to be pushed in the face if they are to believe a fact.

Now you can read articles in the newspapers about the spiritual blockade in Germany. Of course, it has been there for a long time. If we want to deliver the magazine 'Das Goetheanum' to Germany today, we have to deliver it at a cost price of eighteen marks per copy! Think of the technical and medical journals! They are impossible to obtain. Think of the consequences for culture! This is also an economic issue. Germany is under an intellectual blockade. ... The withdrawal of these journals is directly what should lead to the dumbing down in Germany. ... In Germany it has an economic character, in Russia it has already taken on a state character, you can no longer read anything that is not sold by the Soviet government itself. People become a pure copy of the Soviet system. At best, you can smuggle a book here or there.

Question: Is it not useful when observing the economic effects not to start primarily from the statistics, but from the observation of the facts that are available?

Rudolf Steiner: This approach is needed even when consulting statistics. Statistics only enable us to prove things in figures. It is clear that if you come to Vienna now, you only need to walk the streets and gain experience. You only need to look at the apartments your acquaintances lived in ten years ago and those they live in now. And so on, piece by piece. You can make such observations of the most terrible kind. You can see for yourself that an entire middle class has been wiped out, which basically only lives – yes, because it has not yet died. It does not live economically, because if you see what it lives on, it is terrible. You will start from there, but the number can still be extremely important to you as proof.

You have to have a certain “nose” for it; because if you can prove things in figures, the numbers will in turn take you a little further. For example, the devaluation of the crown in Austria: it is indeed laughable how little the crown means today, but not any old value can be reduced without something being taken away from others. If you now look at the victims of the currency, they can be found among those whose pensions and similar income have been devalued. Here you can follow the calculation, and the strange thing is that the calculation could no longer be right for Austria today, let alone for Russia. Austria should have the right to devalue the crown even further, since everything has already been exhausted, and yet it does not explain the state bank default. Of course, this can only be achieved by the blockade that has been brought about in some way. The moment you lift this blockade, people will have to take very different measures. ...

Question: Can the state, as long as there is wealth, seize this wealth by increasing the money supply?

Rudolf Steiner: The state can certainly survive by increasing the money supply, but when the point is reached that the rent has been used up, if it is not artificially maintained, it could actually no longer survive economically, even if it continues to produce banknotes, because the further production of banknotes would lead to a doubling of the rent, which would lead to an increase into infinity. The state must increasingly shut itself off.

Question: Does the state not live off the economic capital itself, which is invested in the enterprises?

Rudolf Steiner: Yes, but off what is a pension in it.

Question: Yes, I mean, it sucks out the capital. The capital decreases?

Rudolf Steiner: To the extent that capital takes on the character of a pension. Because when the state absorbs it, it takes on that character. The state can certainly live, but it can no longer do economic work. That is no longer economics. It can only live off what has already been earned; it only draws on the old. It lives dead off the pension. In Austria, the point should have been reached long ago where the pension is dead. In Germany, it is still a long way off. It certainly could not go on in Austria if certain laws of compulsion did not exist, for example with regard to rent. They actually pay nothing – I think about twenty-five cents for a three-room apartment. The only way things can be maintained is by having certain things for free. In Germany, it is also the case that you may only pay a tenth for your apartment. It is only because of such things that things can be maintained in a certain social class that can afford to pay up to that point. In Austria, a certain social class has deteriorated to such an extent that it can no longer even pay the twenty-five cents. People who had an income, let's say, of three thousand crowns could live on it under certain circumstances; today that is a little over an English shilling. No, you can't live on that!

Today, economic phenomena are so terrible that people might start to take notice and realize that we should actually study the economic laws in such a way that it would help in a practical way. This attempt failed in 1919; but at that time the amount of foreign currency was not as high as it is today.

We could address the question: What does economic thinking mean? - Then: How do you arrive at a concept of work in an economic sense? - And then it would be good if someone were to continue to discuss the terms that I have already used in their own sense, quite freely. It would also be good if someone tried to work out the concept of entrepreneurial capital: what pure entrepreneurial capital is. If you want to characterize entrepreneurial capital in terms of its concept, you have to contrast it precisely with mere bond capital.

Walter Birkigt: Work in the economic sense would be human activity in terms of its economic efficiency. In the field of physics, we know exactly that physical work is determined by its mechanical effect. Is every economically useful service already work? No – value can only come into being through the consumer in the final analysis. If work is done that acquires real value in an economic context, then it can be spoken of as economic work.

Rudolf Steiner: I would just like to make a small suggestion by asking Mr. Birkigt how he would react if, let us say, these arguments were discussed and the question arose: If I in some way combine the work within the economic organism or process with the physical recording of the work, what would happen if one now looks more closely at the concept of physical work? – Certainly, everything you have said is correct, but when the physicist draws up a formula for his work, he will introduce the concept of mass. This is because physical work, an energy, is a function of mass and velocity. You will easily find an analogy for the latter in the economic process. But the strange thing about the physical formula for physical work is precisely that the concept of mass is introduced, which can be determined physically by weight. So in the physical concept of work we have “weight”, which we can only replace by “mass” and “speed”. Now the question would arise as to whether it is necessary, if we stick to your analogy, to introduce something like the concept of mass or the concept of weight into the economic approach. If we were to do that, we would have to seek out precisely that in the economic process which would correspond to mass. So I think this question could be raised in the discussion.

Objection: The problem of the essence of work involves recognition on the part of the buyer. The entrepreneur presupposes this idea of recognition. The fact that the purchase of any goods comes about is recognition.

Rudolf Steiner: Since your concept of recognition is not entirely in the economic field, but more in the philosophical field, it is necessary - so that you can somehow justify that this concept has an economic value - that you give it an economic significance. Because in the recognition as such - when the housewife, for example, first sees that she can use something well - there is hardly more than a judgment. The economic aspect only begins when she can now buy it. It could very well be that the thing is excellent, but for economic reasons, because it is too expensive, it cannot be bought. So mere recognition may be a philosophical category. But it would only become an economic category if it were able to place itself in economic life. And that is why the concept of economic action would clarify.

Question: What is the relationship between the verification of an economic act and recognition?

Rudolf Steiner: “Recognition” as such can hardly be an economic category. This may be because recognition must be subjective. Of course, something subjective already plays a role in economic categories. But then one must show the way in which it becomes objective. Suppose, for example, that two housewives have completely different recognitions of a thing, and for the sake of argument this can lead to a yes to an economic success and a no to an economic failure. The economic aspect would be found where the reasons lead to success in one case and to failure in the other, because recognition can only be a philosophical concept. Of course, recognition can slip down into the [private] economic sphere, but then it must also slip over into the national economy.

Remark from a participant: By economic action, I understand an anticipation of the physical expression of a verification, presenting itself as an initiative.

Rudolf Steiner: We are perhaps dealing here with something quite different from what might have emerged from the discussion. We want to move here in economic thinking. This formula does not prove to me that you have entered into economic thinking with this matter. The formula is, of course, worthy of all recognition, but it is actually more the formula of an economic philosophy that strives, even in a somewhat scholastic way, to find the concept of economic action in order to metaphysically justify economic action before the entire world order. If that is what you are aiming at, then you may take this path; then it will be very interesting to talk about it. But if you ask yourself whether it is not important today, for example, that a number of people, who are now the people of today, bring something out of thinking into the economic sphere that could help economic life, then it is not easy to see what could actually be gained by such a formulation.

Of course, it could be gained that people learn to think better, but we are faced with the necessity to make the national economy as such really fruitful. In science and medicine, after all, it does not depend very much on whether one has a methodology. There this is actually more of a technique in the treatment of methods, research instruments and so on, but the methodology itself has no extraordinary value. In economics, it certainly has an extremely high value, because what we think about things has to be put into practice in economics. Otherwise it is just what Brentano pursues in his way: purely empirical. It does not become practical. Today we need an economic way of thinking that can be put into practice. And that is why it would be extremely interesting to go through the definition word for word. But it is more in the realm of economic-philosophical thinking than of economic thinking.

Mr. Birkigt's discussions were aimed at extracting the concepts of work in such a way that someone who wanted to clarify in an association how one or the other work is to be evaluated can benefit from it. That was your tendency, and that should be our tendency today, if we were stuck inside an association, be it as any kind of worker, so that we would somehow have a basis for evaluating things in their economic process.

Note: economic work is any human activity that directly or indirectly produces value.

Rudolf Steiner: I think that if we want to develop a practical economic way of thinking, we will have to take something else into account. Let us take a scientific analogy to clarify this: the overall process in the human organism is not at all understandable if we only look at ascending processes, processes that run in one direction. You only get a real understanding of the total process when you also look at the catabolic processes. For example, we have catabolic processes in the bones and nervous system; we have catabolic processes in the blood as well as distinct anabolic processes. We can even say that we have anabolic processes in the human organism, starting with lymph formation, through lymph formation to the generation of venous blood. Then we have the processes associated with breathing. These are processes that represent a kind of unstable equilibrium between anabolic and catabolic processes. And the processes that take place in the nerves and bones are distinctly catabolic. Devolutions as opposed to evolutions! We only gain a real understanding when we organize our concepts in such a way that we understand the liver process, for example, as a combination of anabolic and catabolic processes. Someone may come along and may have a mere theoretical interest, who then also subsumes the catabolic processes under the anabolic processes. He says: Physically, the human being develops to a certain degree through anabolic processes. Then he begins to build up spiritually, that is, differently. Now, then we come from one sphere into the other and retain only the abstract web of concepts and thereby learn to understand nothing. We learn to understand the effectiveness of the spirit in the human organism only when we know that the spirit begins to work when there are no anabolic processes; when we know that there is no anabolism in the brain, but catabolism, and that it is only in the catabolism that the spirit asserts itself. Then I have a kind of comprehension through which I enter into reality. If I hold on to a conceptual direction in the abstract, step by step, purely dialectically and logically, then I do not arrive at any practical understanding.

Thus it is necessary in economics to take into account not only the formation of value, but also its devaluation; that one also speaks, to a certain extent, of real destruction. I have done that. Consumption is where it begins, but there is still a mental process in which devaluation also takes place.

They said that when I tear down a house, it also has value. Because at this point, the demolition of the house means that something productive is being created for someone. Certainly, you can see it that way if you stick to the abstract development of concepts. But in practice, it has a meaning where I compose the economic process out of the creation and devaluation of value. And then it must be clear, of course, that work is important not only for the production of values, but also for the destruction of values. Without going into this, I cannot get an adequate concept of work. If work were not also there for destruction, it would not be possible to do any economic activity at all. You have to bring this into your concept.

I believe that it will be of great importance, even in the near future, to recognize what is to happen economically in the direction of value creation and value destruction. Because if values arise that are not destroyed in the appropriate way, even though they are there to be destroyed, this also disturbs the economic process. The process is disturbed by overproduction. The process is disturbed simply by the fact that, figuratively speaking, there is too much in the stomach of the economic system.

Question: Must we not understand the concept of work in such a way that work is an activity that comes into consideration for a closed economic organism?

Rudolf Steiner: What comes into consideration here is that things are taken up as realities. Undoubtedly, the process of creating too much shielding can be a destructive one; but in terms of work performance, it is a constructive process under all circumstances, as long as we remain at work. On the other hand, the destructive process of destroying screens is not opposed to this. Under certain circumstances, destruction is not achieved by what you would define as work. But in any case, one cannot call the process of creating too many screens a destructive process if one wants to think about the matter in terms of work.

We must be aware that in the economic view we are to characterize, that is, we should try to get a concept by defining it from different sides in order to gain a truly descriptive judgment. We have no use for an abstract definition. A concept of work has been established: work is human activity in terms of its economic efficiency, in short, economic activity of man. But how does such a definition of work in the economic sense differ from the definition of work in the physical sense? In such an economic definition, we have nothing real in it. When the physicist defines physical work by means of a formula, by means of a function, and in it has the mass and the speed, then you have something real in it; because the mass can be weighed. If the physicist wants to define the speed, he draws up a definition. The definition serves only as a means of communication. The physicist is fully aware that he is only pointing to what is to be considered. For only he has a concept of speed who knows it from observation. What he defines is the measure of speed. And so the physicist will never believe that he is giving any real explanation when he gives this explanation. But he is of the opinion - whether rightly or wrongly, I will not investigate - that he is giving a real explanation when he explains labor as a function of mass and speed. In doing so, he is getting at a real explanation.

When I do this in economic life, it is because I am approaching the story at the right point. So, for example, if I give my explanation of value at a certain point in such a way that value is produced, value arises, value is a function of labor and a natural object, a natural being, or of mind and nature, then you have labor in the change that is taking place there. This is, of course, a qualitative change, whereas the moving body undergoes a change of location. What the physicist has as a measure is the real substance of nature. However, I am basing a definition that does indeed meet the requirements of such a real definition in physics. I am not doing anything special for economics when I try to define labor in itself. Above all, I must realize that labor as such only becomes an economic category when I bring it into function with the natural product. When you make such definitions, you get into a way of looking at things that is actually quite striking later on. For example, you know that during the reign of classical physics, the physicist always defined labor as a function of mass and speed. In contrast to modern conceptions of ions and electron processes, this working definition completely loses its meaning, because the concept of mass is dropped. We are only dealing with acceleration. In this way, the physical process emancipates itself from what is ponderably present as mass in it, just as capital emancipates itself from the nature it works on in my book and enters into a function of its own.

So you enter a realm that actually justifies itself from all sides. That is the peculiarity of realistic thinking: you think more than you have in definitions. I would like to point out that nowhere, when I speak of economics, do I try to grasp a concept where it cannot be grasped. I cannot grasp “mass” in physics either, but only its function. “Mass is the quantity of matter”, that is also only a word definition! Nor do I want to see the terms nature, labor and capital defined one after the other as economically significant, but rather to be grasped where the realities are: not nature, but nature that has been worked; not labor, but organized labor; not capital, but capital directed by the human spirit, set in motion, set in motion in the economy. I believe that touching things where they are is necessary in economics today!

Question not noted.

Rudolf Steiner: I would just like to point out that the distinction between mental and manual work is not really justified. If one wanted to try to define the thing mental work and the thing manual work, one could not really find anything other than a slow transition from one pole to the other, but no real contrast. Physiologically, there is no real contradiction either. That things have been viewed incorrectly can be seen from the fact that people have always been mistaken about the recuperative effect of gymnastics. Today we know that gymnastics does not represent the recuperation that was attributed to it in the past. The student does not work more through so-called mental work than through gymnastics, which lasts the same amount of time. Of course, it is always a matter of thinking about things in a fruitful economic way.

Question about the relationship between economic and biological thinking.

Rudolf Steiner: The economic entities are, in their reality, as they once were, already very much analogous to the biological entities. You can verify this very well if you try to determine the economic value of a job, for example, a printer's job. Let us assume that a poet fancies himself to be an extraordinarily great poet and manages to get his poetry printed, whether through patronage or financial support or something similar. And now the paper workers, the typesetters, a whole range of people are working on the realization of this volume of poetry, who, according to the Marxist concept, are doing decidedly productive work. But let's assume that not a single copy is sold, but that they are all pulped. Then you would have the same real effect as if they had not been made at all. Basically, you have expended labor completely uselessly in this case. Now, however, you would first have to examine whether this is seven-eighths stupid, as the Marxists say, or whether it does not have a meaning after all. And then you will notice that the biological point of view offers a certain analogy. You can say: In biology I can observe the whole being from beginning to end and have it before me, whereas in economics I only have to do with tendencies and the like. But now I ask you whether you have more than tendencies in the whole of nature, when you consider that not all herring eggs become herrings, but that countless herring eggs, compared to those that become herrings, are simply destroyed? However, the question arises as to whether these destroyed eggs mean nothing at all for the whole process of nature, or whether they only take a different direction in the whole biological process. That is the case. There could be no herrings and many other sea creatures if so many herring eggs did not simply perish. Now, you are still not on the basis of a real observation when you say: Well, eggs are perishing there - and so on. You are still obliged to say: I have an evolution in front of me. The egg has come into being and perishes through something. The whole herring also came into being and perishes through something. The processes only take on different directions, and the herring merely continues the tendency of the egg. Nowhere can you somehow say that the herring has a greater right to cease to exist than the egg. And now you have an analogy with perishing labor, with perishing economic entities.

You can come up with countless analogies between economic and biological thinking. This is only not noticed because we have neither a proper biological nor a proper economic thinking. If biology were to begin to develop a real thinking, it would become very similar to economic thinking. You need the same abilities to do real biology as you need to do real economics.

Question: What is the justification for printed poetry that is then trampled on again, compared to herring eggs?

Rudolf Steiner: The matter may be as follows. If the people who are employed were not kept busy, these people would naturally have to find something to do elsewhere. And if they had to find something to do elsewhere, then under certain circumstances not enough would be derived from human activity. Human activity, like herring eggs, must also be diverted under certain circumstances, and this diversion also has an economic effect. It is easy to say that sleeping is rest, and living is activity. From a certain point of view, however, sleep is much more necessary for life than waking. It is the same with this activity. Of course, you can say: I want to use it in a more useful way; but it is questionable whether it is more useful when it comes to umbrellas that are produced too much. First of all, these are stopgaps, albeit in an inappropriate economic process, to eliminate work that would have a disruptive effect. The matter would turn out differently if one were to think in a healthy economic way. If one were to think in a healthy economic way, one would have to expend a colossal amount of cleverness - but here we go beyond the usual economic consideration - in order to utilize the surplus working hours that arise for those people who cannot work for themselves. So, it is actually the case that if one were to think in a healthy economic way, something would immediately arise that you would probably welcome with joy. But people cannot imagine that it would be necessary to teach those who are unable to work for themselves, who are unable to occupy their time, what it means to save time. For it would hardly be necessary for a person who works eight or nine hours today to work more than three or four hours longer. If people thought in terms of economics in a sensible way, they would need to work much less than they do now. And then the time saved would simply correspond to the time it takes for the herring eggs to hatch. Now people waste so much on work that has to be done again anyway.

Note: When one speaks of biological thinking, one has a certain limited object of perception about which one thinks. When thinking economically, one has to designate through thinking what one is thinking about economically.

Rudolf Steiner: You only have a limited object of perception in biology to a certain extent. You do not have this with world structures that are observed under a microscope, for example, or where you observe individual phenomena as emerging from a larger context. You can say that you have a manageable object in a drop of blood. But the moment you look at it under the microscope, you see more – five to six hundred red blood cells in one cubic millimeter, and they are all active. This is certainly visible to the eye through the microscope, but it looks damn similar to what you see when you look at a limited economic process somewhere. Imagine you are standing in front of a stall at the fair and see how the stall-keeper is standing there, how his wares are lying; there are the customers, he hands over the goods, they put down the money, ... if you now imagine, you manage to be such a giant - how you can think of all this as something very dense and cohesive, then there is no real difference. I can understand the economics of a limited area just as relatively. If I look at the booth owner with everything that goes with it, it is only relatively different from, say, when the British sell opium in China and I look at everything that goes with it. I can't find why you don't have an object.

Question: I just don't know where political economy begins and ends.

Rudolf Steiner: We also don't know where biology begins. It is another thing to ride the comparison to death. I just mean: What makes it possible to understand the nature of living things, the same in the conception makes it possible to understand economics. Only one thing is necessary. What you say may apply: when you look at a natural object, the object comes to you, whereas in economics the subject must come to the object to some extent. In economics, you have to have what I called spiritus yesterday. So biologists can really have very little spiritus and only work with the methods. But to think economically, you will need some spiritus.

Question: It seems to me that the economic process has come about without thinking in economic terms; that thinking must first become economic. Whether the economy is healthy or unhealthy is irrelevant. In this respect, I will be able to speak of an object in economics in the same way as in natural science.

Rudolf Steiner: Mr. G. is right: the difference is that in economics it is necessary to start from a certain subjective grasp of what is happening in the world. But in economics this subjectivity is in turn easier than in biology. In biology, you are always on the outside, of course, as a human being – since you are not a cockchafer when you study it – and you have to stand on the outside, whereas you are only on the outside to a much lesser degree when you look at something economically. You can still muster enough humanity to understand the worker well, to understand the entrepreneur as well. That is the general human element, and it replaces what is external observation in biology. In this respect, Mr. G. is right. But on the other hand, I believe that Goethe, for example, gave such a good definition of the dark side of the concept of trade because he did indeed go very far in his biological approach. Thus, Goethe sometimes expresses remarkably apt economic views. This has something to do with his morphological-biological approach. In biology, nature plays the role of someone who pushes you when you don't have the spirit yourself. In economics, you have to apply the spirit yourself.

Objection: There are theorists who say that there is no such thing as a national economy because there is no economy. Spann expresses this.

Rudolf Steiner: He is much admired and is considered a special luminary in Vienna by very clever people. I have not studied him enough to have too much of an opinion about him, but what very clever people say about him has not particularly convinced me. But it would only be a clever dialectic to say that there is no economy. There are also people who say that there is no life, only mechanism.

We should now look at specific aspects. Someone should try to show more specifically where economic processes of exploitation and devaluation are necessary.

Note: The concept of recognition is again put forward for discussion and again characterized by Rudolf Steiner as unsuitable for economics.

Rudolf Steiner: The concept of recognition leads into economic philosophy, not actually into economics as such. Furthermore, our aim must be to find such views in economics that can be carried through, if possible, by always changing themselves, through the whole of economic life. With the concept of recognition, you will hardly be able to cover all economic elements without greatly expanding this concept. You can always do that with concepts. Let me give an example: How would the concept that was formed yesterday be shaped if we were dealing with the fact that a completely unknown Rembrandt was found somewhere in a floor drain, if it were a matter of estimating the economic value of this Rembrandt, of which one can speak with certainty. I do not mean how it would be done at all, but how it would be with the concept of recognition.

Note: The representative of the concept of recognition blames the “political” for bringing about recognition of anti-social processes - for example, undeserved economic gains.

Rudolf Steiner: If we have the opportunity to implement the threefold social order properly in reality, then the concept of the “political” as you have developed it no longer applies. For the political is essentially given in the legal, so that the political would then be completely absent from the economic, and one could not bring about a “recognition” through some kind of political behavior.

But the question remains: what then is the “political”? The political is actually an extremely secondary, highly derived concept. From a purely economic point of view, there is no reason to be political. In the example you gave, with the entrepreneur who expects 200,000 marks and then, if he gives 80,000 to the workers, takes in 500,000 due to brisk business, there is no need to drift into the political. Let's assume the following: With the extra money that has been generated, the entrepreneur can openly stand before the entire workforce and say: I expected to generate two hundred thousand marks. But three hundred thousand marks more have been generated. We have founded the business under these conditions, that two hundred thousand are worked out. These three hundred thousand have been worked out more. I find it more correct for these and those reasons for the totality of the economic organism in which we stand, to found a school, for example, with these three hundred thousand marks, than to distribute it to you. Do you agree? - There you have a form in which the economic process remains the same, but you do not need to take any political factor into account.

In world history, the political is a secondary product. This is based solely on the fact that the primitive, perhaps highly unsympathetic but completely honest power relations have gradually taken the form of war among people. It cannot be said that war is the continuation of politics only by other means, but politics is modern war transferred into the spiritual. For this war is based on deceiving the opponent, on creating situations that deceive him. Every stratagem in war, everything that is not a direct open attack, is based on deceiving the opponent. And the general will ascribe to himself all the greater credit the better he succeeds in deceiving the enemy. This, transferred to the spiritual, is politics. You will find exactly the same categories in politics.

When talking about politics, one would like to say: We should strive to overcome politics in everything, even in politics. For we only have real politics when everything that takes place in the political sphere takes place in legal forms. But then we have the constitutional state.

Question regarding the tailor example.

Rudolf Steiner: The only reason for this deception is that the quota that is formed by a single suit is an extraordinarily small one and it would therefore take a very long time before this small quota is visible in the tailor's balance sheet in such a way that he would actually perceive it as a loss. The point is that the division of labor makes products de facto cheaper. If you work for a community under the influence of the division of labor, your own products also cost you less than if you worked for yourself. That is precisely what makes the division of labor so cheapening. If you break it at a certain point, you make the item in question more expensive, which you have prepared yourself. Of course, a single quota for a single suit that a tailor makes for himself would not make much of a difference. On the other hand, it would be noticeable if all tailors did it.

With a more extensive division of labor, no one will prepare anything for themselves anymore, except in agriculture. If a tailor actually makes his own suit and he wants to draw up a completely correct balance sheet for himself, then he would simply have to include his own suit in this balance sheet at a higher price than the market price. So he has to set his expenses higher than the market price. It does not matter so much whether he actually buys the suit or not.

It is, of course, a self-evident prerequisite that it is not other tailors from whom one buys the clothes, but that they are traders. The price of a suit from a trader is cheaper – otherwise the division into production and trade would make no sense – than the price could be if the tailors in question worked without traders. So the tailor has to set the price a little higher when he works without a dealer, because the dealer simply brings it to market cheaper than the tailors themselves could sell it. At most, you can still make the objection – which might be justified under certain circumstances – that you say: the significantly cheaper price of the goods sold without the dealer would be that the tailor, if he had to get the goods from the dealer, would then have to factor in his travel costs. You would find that by including the trade, these ways actually come cheaper. By simply comparing the producer and dealer prices, you can never find out whether the suit is more expensive or cheaper.

Question: The price of one suit should put pressure on the other suits. Why would the other suits become more expensive?

Rudolf Steiner: It exerts a downward pressure on prices in that it removes one suit from the sum of all suits that traders deal in, and that it deprives traders of the opportunity to make a profit on this suit, so that they have to demand a higher profit on the other suits. What the traders demand as a higher profit causes prices to rise among the traders, but among tailors it exerts a downward pressure on prices.

Question: The question now is whether this price pressure makes up less than the trade route brings him in price increases.

Rudolf Steiner: You will not find that anywhere. Try to solve the problem. This is a task that can be posed directly: to what extent does trade reduce the price compared to the seller's own sale? This posed directly as a dissertation task would be important. You would see: if fifty tailors make their way and have to calculate these ways, it actually costs more than if the traders make the ways.

Objection: You say of the suit that the tailor keeps for himself: When it goes through the shop, it becomes cheaper. Now, in the case of the suit that he keeps for himself, the entire expense of the shop, of arranging the transaction, is saved.

Rudolf Steiner: That would make a difference if trade did not reduce prices. But since trade reduces prices, it does not matter that the suit stays at home.

Note: Let us say the cost price is one hundred marks. When trade is added, the suit costs one hundred and twenty marks. The dealer reduces the price to one hundred and ten. If the tailor does not bring his own suit into circulation, he saves the ten marks.

Rudolf Steiner: But in this case, you have to look at the overall balance sheet that arises from traders and tailors as something very real economically. You would have to examine how this individual item appears in the overall balance sheet. You can't find it by just comparing the individual balance sheet items. You have to see it in the overall picture. Then you would see: because economic division of labor means a fructification of labor, if I go back to an earlier state in a perfectly economically divided labor, I harm myself with the others. One is so interwoven with them that by going back to an earlier stage one also harms oneself. The deception arises from the fact that it is difficult to grasp the terribly small quota. But I only need to set up the progression: if you think that all tailors make their own suits and that they would now form an association, then what would have to be entered differently in the balance sheet as a joint item would mean something.

Note: in the ready-to-wear industry, this is already more apparent.

Rudolf Steiner: That is absolutely certain. Of course, we then have to examine the underlying causes. It will be a terribly small item if it is only a matter of the division of labor between the producer and the dealer. On the other hand, the item becomes very, very considerable if there is a further division of labor, if the tailor otherwise no longer makes whole suits at all, but only parts of them. Then, if he wants to make a suit for himself, it will cost him much more than if he buys it somewhere. I said that it is a radical example that is only significant in terms of principle. But what later emerges with a further division of labor also applies at the very beginning of the division of labor.

Question: Why can't this be applied to agriculture?

Rudolf Steiner: I did not say that. I said: It is becoming less and less the case that people produce for themselves, with the exception of agriculture, where it is obvious that the farmer provides for himself. In agriculture, where so many corrections are made to the general economic process anyway, it really does not matter that much whether the farmer takes his cabbage from his own land or buys it. If, however, in the sense of the threefold order, there were a real economic relationship between agriculture and non-agriculture, then it would also be relevant for agriculture. The fact of the matter is, however, that basically all kinds of underground transfers take place and as a result the relationship between industry and agriculture in terms of prices is completely undermined. This will be discussed in the next few days. But if we were to examine the overall balance of an economic area by balancing agriculture and industry against each other, it would emerge that, under current conditions, substantial amounts flow from agriculture into industry, simply through underground channels. But if, under the associative system, there were just as many or at least approximately as many workers in one sector as prices would allow, then we would have a very different distribution of urban and rural areas. We underestimate what it would mean if the associative being were to be realized. That is why it is not very easy to answer the question: why is the “Coming Day” not an association? Simply because it is not powerful enough to have a certain influence on the economic process. For that, the association must first reach a certain size. What does the “Kommende Tag” want to do today between employers and workers that is much different from what usually happens? That would only be possible in one case - I once said this at a company meeting - namely if all the workers of the “Kommende Tag” decided to leave the trade unions. Then you would have the beginning of a movement that, as such, would gradually get the ball rolling from the other side, the workers. But as long as the workers simply take part in the strikes in exactly the same way as the other workers, it is quite impossible to talk to the workers in the ideal way.

Above all, the associative nature of the human being would cause a whole series of factories to migrate from the city to the countryside, and similar things would arise as a necessary consequence of the associative nature of the human being. It is not for nothing that we have villages and village economies. In the primitive economy, the village economy is the only economic form. Then it moves on to the markets. These terms are much more correct in economic terms than one might think. As long as the market is there and villages around it, the market, even if it is based on the principle of supply and demand, means something that is much less economically harmful – if there are no scoundrels, which is a personal matter – than when the city economy is added. This radically changes the entire relationship between producers and consumers. Then we no longer have villages that regulate their market by themselves, but we have opened the floodgates to all the possibilities that arise when the relationship between consumers and producers is no longer clear, when it becomes mixed. And that is the case when people live together in cities.

The relationship between producers and consumers cannot be overseen other than by forming associations. But then the conditions that arose under the hive change. For the associative being is something that not only organizes, but also economizes. It would arise under the associative being that from each individual link - on which the interaction of the three links of the social organism is based - the health of the other arises at the same time.

Over longer periods of time, but still not too long ago, it would become apparent that in cities, administrative officials and centralized schools, and so on, would essentially be together, that is, essentially spiritual life and legal life, while economic life and legal life would be decentralized together. So the coexistence would also be spatially divided, but not in such a way that one would now have three completely different links, but so that the cities would essentially represent a confusion of spiritual life with a more centralized, a larger horizontal administration. And smaller administrations in the circle of economic enterprises would be more decentralized. This would require that the traffic conditions would be much more effective than before. These are not so far advanced only because one does not need traffic for production when the producers are scattered around the cities.

It is not at all easy, my dear audience, to talk about threefolding because there is so much intuition involved. If you describe to someone today what is happening, they will say: Prove it to me! No one can prove to me, even theoretically, that he will be hungry tomorrow. Nevertheless, from experience we know that he will be hungry tomorrow. And so, with correct economic thinking, correct economic foresight also arises. You must see that as something real, what is meant here by actual economic thinking, that one begins to develop such thinking that is really productive itself. Otherwise, I could ask you: what economic value does economics have? - A merely contemplative one has a very different economic value - it is essentially a consumer - than a real one; it is essentially a producer.

Question: Tailors lower the price of their product when they supply themselves by dividing the work. Does this also apply to a button or another sub-product?

Rudolf Steiner: As a boy, I lived in a village where there was a shoemaker – Binder was his name. He rejected any exchange between himself and his customers that he did not take care of himself. He brought every single pair of boots he made to me, my father, my mother, himself. What does the whole pair of boots consist of? In this case, it consists of the tubes — the tubes were so long —, of what is at the top, of the instep, of the sole and of the cobbler's work, which he had to do for us. All of this belongs to the pair of boots. It makes no difference whether you speak of the tube or the sole or the cobbler's process. The division of labor first occurred when the part that made up the process was removed. This is most radical in the case of the tailor, because it is not so easy to see what is involved. When I put on the boots, I knew that I was walking on the path the cobbler had made!

Question: If I make the button myself, will I also be expressing the price?

Rudolf Steiner: In that case you will also, under certain circumstances, lose the most; because you cannot use it at all!

Interjection: I would like to assume that I need it.

Rudolf Steiner: Then the question arises as to why you need the product. If you change it in such a way – it can be a small or a large change – that it acquires a reality value, then perhaps you will lose nothing.

Remark: I need it for consumption, that is, for destruction.

Rudolf Steiner: In agriculture, other adjustments occur. If the division of labor were carried out, it would also apply there. But you will hardly have the opportunity to utilize what has been produced under the division of labor if you retain it, in such a way that it produces a reduction in costs.

A loaf of bread is still very close to agriculture. Nevertheless, we have had a rather disastrous experience with this loaf of bread. We induced a member of our society, with quite good intentions – it was before the war – to produce hygienic and otherwise good bread. And this bread was then only given to our members; others did not take it. The bread became so expensive that it simply could not be sold.

Note: That was high-quality bread.

Rudolf Steiner: If the price difference had only been justified by the quality, then it could have been justified. But the price difference was much greater, only partly due to the fact that the general production was subject to the principle of a more extensive division of labor than that of our member. And he produced in such a way that he did not distribute his production among as many people as the others; so he produced much more expensively.

Question: What about fashion pieces?

Rudolf Steiner: But here we are now in the aesthetic field, no longer in the economic field. I did not want to touch on the question of whether it might not be extraordinarily good if the division of labor were avoided in certain fields. I am even opposed to the division of labor being carried out in all areas, but not for economic reasons, but for reasons of taste. I find it even horrible when the division of labor is carried out down to the last detail, for example, in human clothing. But here we have to say: we must of course assert the free spiritual life, which would naturally cost us something at first. It would make some things more expensive, but there would be a balance, even though some products that are not included in the division of labor become more expensive. Please do not misunderstand me as wanting to be a fanatic. ...

Question: What if there are significantly more traders than are economically justified?

Rudolf Steiner: What I have said is based on the premise that there are just as many traders as are economically justified. We are not dealing with a straightforward progression, but with a maximum-minimum direction. At a certain point in the number of traders, we have the most favorable influence of the merchant class. Below and above that, it is unfavorable.

Question: Is the number determinable?

Rudolf Steiner: If there is any rational economic activity at all, then the number of traders can be determined, as can the number of producers. Today, you have the principle of rational economic activity nowhere. People do not consider how an enormous amount of unnecessary work is done. Just think of the printing press. If you were to spare all this unnecessary work, then you would get an approximation to the natural numbers everywhere. Sparing unnecessary work already provides a reduction of the natural numbers of the people employed in a sector. Today, the fact is that the merchant class actually consumes more than the producers themselves. At least for Germany.

There must be a certain number of traders for each article. But you will also have to bear in mind that sometimes even the merchant class is masked. It is replaced by something else, by the most diverse things. Just think how much of the merchant class, for example, can be replaced by setting up large bazaars. This creates a completely different economic category.

Question: Can we still speak of value when a thing has fulfilled its purpose? What about when the thing first enters the economic process? Does the demolition of a house mean devaluation through human labor? Does this devaluation have any meaning or not? Can we only speak of devaluation through human labor when new values are not created?

Rudolf Steiner: Please express your views on this! Topics will arise, for example, coal and lignite. Someone might come up with the idea that coal, as a substance, is simply a more valuable object than lignite. But then he would have to defend his “thesis.” The other thesis would be the somewhat daring one that mechanical work generally does not have the effect of increasing costs. The esteemed audience will have this or that objection. Then the question of valuation and devaluation is not exhausted by citing exceptional phenomena, such as submarines, but it would be a matter of having to bring about economically necessary devaluations through work in the continuous process of the national economy.

Various interposed questions.

Rudolf Steiner: The question is whether or not one can speak of appreciation and depreciation through work, even in a purely economic sense. If machines are devalued, then in economic terms this would be consumption. The question is not whether the goal of a work is depreciation, but whether depreciations are necessary in the economic process, and these can only be achieved through work.

X: The devaluation of values through work occurs for the purpose of subsequently placing higher values in the place (intermediate values).

Rudolf Steiner: This example can be given. However, it is not absolutely flawless. A much simpler example is an everyday one: if you wind thread onto a spool through work, you have created a product. It comes about through the work that is done, namely the twisting. If I continue the work, I have to unwind again. Work is actually necessary here. In the case of intermediate operations, it is necessary that the work created in the process is dissolved again.

Question: Would the same apply to the transfer of products?

Rudolf Steiner: It would at least take place if you move one orbit to another position. You have to devalue the first value in order to give the second the correct value. If you have an orbit here and you want to put it here, then you have carried out such a devaluation by rearranging it. And such things can be found everywhere. These would be devaluations that become necessary and that require work to be carried out. You just don't usually notice them. But they are everywhere. You just have to take the coal shoveler who shovels the coal for the locomotive. The stoker has to shovel it out again. If you just want to grasp the concepts, you can say: it's a continuous process. But that wouldn't be enough. You would have to calculate, since the continuous process cannot be directly achieved here, what the continuous process would cost if I had prepared the coal everywhere, in contrast to what it costs if I always carry out a sub-process and then have to destroy it again.

Question: Would the packaging industry also be an example?

Rudolf Steiner: Yes, certainly. A very striking example where you really cannot use the concept of utilization and also not that of mere consumption through wear and tear, as in the sharpening of razors. A valuable product is destroyed, and that is a necessary economic task. Consumption consists only in blunting. But to devalue it completely, work is necessary.

Question: Collecting, selling, melting down and reusing scrap iron – can the melting down also be called a revaluation?

Rudolf Steiner: This is the same as recycling waste. You would not call that a devaluation.

Note: But one process is complete!

Rudolf Steiner: Yes, and then I discover that I can re-use what is present as a natural product. The criterion must be that human labor is necessary to bring about a devaluation process.

Melting down iron is not really a process of degradation. Of course, things can be ambiguous. They can be understood in different ways. They could also be understood as a product of devaluation.

Question: Devaluation through war – shells turned into powder?

Rudolf Steiner: For those who are not the victors, this is a devaluation.

Question: Can what happens to war equipment even be addressed as value creation in the economic sense?

Rudolf Steiner: This can only become economic in its consequences. The war industry is not value-creating as long as it is only for stock. In that sense, it is actually a form of labor, but one cannot say that it is a necessary form of destructive labor.

Note: What is consumed beyond normal needs, implements of war and so on, results in a shortfall, for example, after the war is over.

Rudolf Steiner: It must be borne in mind that the abnormal consumption that occurs here has a certain similarity to the consumption of rentiers in an economic community. This consumption is a given. If one wants to justify it - today one fights against it - then of course there is a certain justification for all things. The consumption of the rentiers can be justified if the land production yields a greater yield than can normally be consumed by the rest of the population. In order to establish economic equilibrium, the consumption of the rentiers is good under certain circumstances. And from this point of view, there is an economic justification for the armed forces. This justification lies in the fact that people say: the things are there and they can be produced. There would be no economic equilibrium, so many would remain unemployed if the military were not there to consume without actually producing. For it does not actually produce anything.

Question: Shouldn't the military be viewed in a similar way to the winnowing of wheat or something similar?

Rudolf Steiner: This view is to be found in the school of Rodbertus. Defense is counted among the productive factors. The question is whether we are thinking of an economy under certain conditions or without these conditions or with other conditions. If we were to imagine that defense by a military force were not necessary, it would be dropped. But the fire engine cannot be dispensed with because it corresponds to a necessary consumption, like breakfast. Those who consider the military to be absolutely necessary must regard it as a necessary consumption. But this is where the possibility of a discussion about the consumption question begins. We know people who consider the strangest things to be absolutely indispensable. The concepts of use play a role in the evaluation. And they are unstable.

Question: Mechanical work, for example, water power through turbines, saves human labor. Is the assessment made as if the mechanical work were done by human labor?

Rudolf Steiner: Imagine a scale with unequal arms. If I have a large load on one lever arm, I then have to shift the weight on the other. In this way, I can keep a very large weight in balance with a very small weight here purely through the position. This is how it is with the economic distribution of such things as you have called 'mechanical work'. The work that has to be done only decreases in the same proportion as here with the scales. But you will always find a certain amount of work that has actually been done, even with mechanical work. You cannot simply get something from nature without further ado. If you just want to put a stone on something to make it do work, you have to at least fetch it. You always have to put in a little human labor. But these things do not belong in the national economy at all, where the ratio of labor expended to the output is functionally determined by the circumstances.

Question: But mechanical work in itself does not make the products more expensive?

Rudolf Steiner: If you look at the work in its entirety, then you have to calculate a quota everywhere.

Question: How does devaluing work fit into the economic process?

Rudolf Steiner: If you have a continuous economic process in which you have to devalue – let us assume you have such a large shaving shop that you have to employ a special worker to sharpen the razors – then of course you have to account for this worker's work in a different way than you account for the work of the people who are sharpening the razors. Of course, on the surface it also looks like work, but in the economic process it is different, namely negative.

Question: What happens in the case of devaluation work? It is a gift because it has no equivalent value.

Rudolf Steiner: Only the signs of the value change. It is the same everywhere. If you have a value creation that you describe as positive (+) in the ongoing economic process, then you have to describe the devaluation as negative (-), while if nothing happens you have to insert zero. Note: When a new machine replaces a process, the product becomes cheaper simply because labor is saved. Whether it is value-forming or devaluing work, it makes no difference.

Rudolf Steiner: Yes, the thing is that you can always bring out the same result. But it still remains a division into value formation and devaluation. It is self-evident that if you draw a sum from it, a positive sum results if a machine is to be used at all. ... The only question is whether it is necessary to expend labor on dissolutions, that is, on devaluations of values that have already come about in the economic process.

Question not noted.

Rudolf Steiner: It will be necessary, so that no unclear concepts remain, to discuss the cup of tea, the drinking of which is said to be economic work.

Objection: I cannot accept that as work. The criterion of labor is missing.

Further remark: When one takes in food, one first creates the values within oneself that are capable of producing further work, just as when one creates machines that are intended to produce values.

Rudolf Steiner: But it is not possible to include what happens in a person in the national economy. That would lead to the Marxist theory.

The Lord must have thought of something else. You do realize that drinking a cup of tea could provide economic value, that is, economic work.

Note: If a spiritual worker is supported with economic values, the immediate success will be that he can eat and become spiritually active or refreshed. The consequence will initially remain within his personality; but it does not stop there. The consequences radiate out into the economic process. These would be the consequences emanating from the subject.

Rudolf Steiner: But these cannot be readily incorporated into the economic process unless something is added. Because you cannot regard drinking a cup of tea as productive. The cup of tea would only be economically relevant if you wanted to produce something, you would drink a cup of tea in addition to your usual food and thus be able to work more than you would have worked without the cup of tea. The question would then be whether this could be seen as an economic service.

Note: The fact that I consume tea means that tea can be picked in the colonies. I actually devalue by creating the possibility for new economic values to be generated.

Rudolf Steiner: If you want to determine economic values in a positive sense, you come to a different level when you discuss the question of the extent to which consumption is necessary to continue the economic process. That is a question that actually has nothing to do with the economy as such.

Note: I would like to put the devaluation that occurs when the cup of tea is drunk so that one can work again on the same level as the example of the doctor and shoemaker. The tea picker applies labor. I drink the tea. The tea picker serves to enable me to work again.

Rudolf Steiner: If we put the question this way, then tea picking turns the natural product tea into an economic value. That is the creation of an economic value. But will an economic value arise or disappear in the same sense when the tea is drunk?

X: It will disappear, will be devalued.

Y: I would like to say that it is revalued.

Rudolf Steiner: This translation cannot actually be carried out; because then you would have to describe every consumption, every use, merely as a conversion.

Remark: conversion into energy.

Rudolf Steiner: Then we go from the economic realm into the realm of natural science. There you are engaging a natural process that no longer belongs to the economic realm.

Take the process of drinking tea! You drink the tea up. Now you have this value, which has been produced, made to disappear from the economic process. There is no question about that. Now, for my sake, you will even be strengthened by the tea – I will make this assumption – and do an economic job. This in itself is not yet value, but it is value when you apply it to a natural product. And only now does the economic formation of value begin again at the moment when you approach the natural product. The question of whether you have become stronger or not does not arise in the formation of value, but the formation of value only begins after you have become stronger. So, what happens in you when you drink tea, even if you become an athlete by drinking tea, is not what you contribute to the economic process.

This natural process must be excluded in the same way as the value of land. Of course, you can include it, and then it is analogous to including earthworms in the economic process without human labor being used for it. When the earthworms go through the field, they make the field fertile. You cannot include this in the economic process. Just try to follow this in the further results. You will also see: if you were to be strengthened by consumption, it would be seen as value-forming. Then you would enter into an economic order in which work alone would be value-forming. It is only in connection with nature or the human spirit.

It is not possible to arrive at a political economy if one includes processes that lie in human beings or in nature in the political economy.

Question: How do you want to look at the gift?

Rudolf Steiner: I may speak of a devaluation in the gift, because as long as I only have human abilities in mind for which I can use the gift, I am not yet speaking of economics. First, when I give a scholarship, I let this value disappear into the economic process until it comes up again.

Note: One can almost see how the gift continues to work.

Rudolf Steiner: What continues to have an effect depends very much on such factors, which absolutely elude any accounting approach. Otherwise, for example, you would have to use diligence in economic terms. But diligence would be a fictitious value in economic terms, not only a fictitious value, but even an impossible value.

In the moral sense, if I had, say, a workshop, I would reprimand my workers if they were lazy; in the economic sense, I would only reprimand them if they did not produce anything for me. In the economic sense, I am only concerned with what they produce. Morally, I am concerned with whether they are hardworking or lazy.

Question: Can we only speak of work in an economy based on the division of labor?

Rudolf Steiner: We can only speak of economic work when reciprocity begins for one another in the work.

Question: Can we speak of work in the primitive economy?

Rudolf Steiner: We can only speak of work in primitive societies if we consider that the father does a certain job, that he consumes and his wife, sons and daughters also consume, the daughters do different work and so on, in other words, work for each other.

Question: So how do we even arrive at a concept of work?

Rudolf Steiner: It is very easy to form a concept of work in the economic sense. It exists when we have a natural product that has been transformed by human activity for the purpose of being consumed.

Question: Does it matter whether it is consumed or not?

Rudolf Steiner: It must at least be made consumable, because then it has value.

Question: Do you always have to look at the natural product or the object when a value is created through spiritual organization of work, or do you have to see if there is an object on which the organized work has been applied?

Rudolf Steiner: You cannot look at an object, because in the context in which you are dealing with it, a lasting object is not there. The mind can only be used for the organization and structuring of the work. Then, under certain circumstances, you are not dealing with an object.

Question: Then it does not fall within the concept of work?

Rudolf Steiner: That is a secondary concept. Work is the human activity that is expended to make a natural product consumable. That is work in the economic sense. You must now understand this as a final concept. Now the spirit can take over and organize this work. But in the process, what you now want to grasp as a coherent economic process can simply move away from the natural product. It can consist in mere structuring, in mere division of labor.

Question: But what if devaluation is added through labor?

Rudolf Steiner: Devaluation is only negative for the value. In terms of making it fit for consumption, you are not going back. You are only going back in terms of assigning value.

Remark: In terms of making consumption possible, there is indeed a decline from a higher process to a lower one.

Rudolf Steiner: First you wind the spool. This requires work. You have created value here. And now you unwind the spool. You destroy the value. But if you look at the matter, you will find that a consumable product has been created up to the point of destruction, and afterwards the end goal of the work is once again a consumable product. The work consists of making a natural thing consumable. They have just switched on a sub-consumption. They need so and so many such processes to have them consumed by other processes. In this consumption, where the devaluation must take place, a necessary work is done.

Note: Useless labor must be designated as labor because its product has been brought to the point where it can be consumed.

Rudolf Steiner: If you want to have the concept of economic work, then you have to define it that way, but the concept of economic work is not yet a value. Only work is defined. The point in economics is not to apply economic work, but to produce values.

X: The teacher also does work.

Rudolf Steiner: That is the question. It is not so easy to answer.

X: I am talking about free spiritual activity.

Rudolf Steiner: This belongs to the realm of devaluation, but not devaluation through work.

A: But in the future he is the producer. For this purpose he does 'work.

Rudolf Steiner: This gives us the opportunity to pursue the concept of work ever further. Of course, teaching must be described as an economic value to the highest degree, but the question is whether, if we begin to imagine the concept of work in the economic process, we can still hold on to anything if we call teaching work. Of course, work is already being done as the teacher speaks, walks around, wears himself out. A kind of work is being done. But that is not what flows into the economic process. What flows into it is his organizing activity, which is not even related to what he does as work. That is why work as teaching is so different. A fidget can do a lot of work by fidgeting. Another can do a lot of work by cutting. But the one who teaches with a certain calm pace will also do a job. But that is not what goes into the economic process, but rather his free spiritual activity.

Note: In the performance of work, too, there are those who work hard and achieve little, and those who work little and achieve much.

Rudolf Steiner: Here we already have work that liberates itself relatively. On the one hand, we have work that is actually bound to the object. This work becomes increasingly free of the object. In the case of free spirituality, it is completely detached from the object. And what the person in question “works” is irrelevant. For the economic process, the work of the teacher is not what comes into consideration in the economic process. His capacity, his education, everything else is taken into account economically, except for the work he does.

Question: Why is free spiritual activity devaluing?

Rudolf Steiner: It is devaluing in the sense that it cancels out the values that are formed on the one hand. The Romans had a very fine, instinctive sense of economics - it was just right for a different national character - in that they did not just talk about bread, but about bread and games. And from their point of view, they included both bread and games in what should be included in the social organism. They said to themselves: Just as, when I produce a loaf of bread, it in turn must disappear – it must really disappear – so the labor that is there for the production of bread must actually disappear again in the social process through the labor that is used to perform the play. It is a mutual consumption, as everywhere where there is an organism, there is a mutual building and breaking down. So it is here too. So you can actually see how the mental activity that is carried out on the other side does not continue the process, but takes it backwards. That is why I have always drawn it as a cycle. Nature, labor, capital. Nature, labor, capital returns to itself and the whole process is suspended when it has come back to nature.

Question: Can private economic activity also be included in the concept of the national economy?

Rudolf Steiner: You have to! Within the private economy, certainly.

Objection: I think I cannot include private work in the concept of the national economy.

Rudolf Steiner: That comes from the fact that there is a lack of clarity in the word. The lack of clarity lies in the fact that one already calls a national economy a summary of private economies. One should have a superordinate concept.

Question: Is work only the activity that is to be directed at a very specific object in order to make it consumable?

Rudolf Steiner: That is the case. In economics, one does not have the task of simply, I would like to say, forming abstract philosophical definitions. Under certain circumstances, this is something that one can well impose on oneself as a philosophical pastime or as a form of training. But in economics, the aim is not to create correct terms, but terms that can be applied. People like the economist Lorenz von Stein have created wonderfully astute terms; but a whole host of terms are only of interest to economic philosophers, so to speak. They have no economic application.

X raises the problem of exchange rates and their fluctuations for discussion. He suspects that certain personalities are behind this.

Rudolf Steiner: This does exist and is one of the partial causes. It is very difficult to say that something is the main cause, because this has changed a lot at different times. But the most diverse causes converge in the foreign exchange conditions. The main cause of the more recent foreign exchange losses is the discrepancy that has arisen between the gold and paper currencies in one's own country.

It is essentially the case that the gold currencies no longer play a decisive role in countries with weak currencies. On the other hand, in countries with a sound currency, the cover is still there, which naturally means that those countries that have gold currencies are in a significantly different credit situation than the others. First of all, the foreign exchange question is a credit question. Then, of course, when something like the credit damage of an economic area occurs, one can also use such a cause to go further. You can drive down credit again on the stock market. In addition, there are the rather senseless ventures in one's own country. There is no question that at present there is no reason for the fall of the German mark to the extent that it actually occurred, but that speculation in one's own country, which sells abroad and thereby adds to the situation, plays a significant role. All this then causes the foreign exchange to start rolling downhill. Then it is the same as in Austria. It is difficult to say what else contributed in Russia. In Austria and Germany the thing started from the decrease of the gold stock, from the decrease of the credit conditions, from speculation in one's own country. In Germany there is speculation on exports, in Austria there is speculation right now in such a way that the foreign stock is held back, making it even more expensive, so that in Austria the crown is being pushed down by francs, dollars and so on that are in the country. This could not have happened if the currencies of high value had not already risen. Then it could even continue in its own country, and as a result this matter could reach immeasurable proportions. But it was the beginning of the evil that German gold was collected to such an extraordinarily strong extent during the war and transferred to the state, which ensured that the gold came out of the country. There is no gold among the people at all. That is the essential thing. Today, the Reichsbank's gold holdings can only be compared with the population's total gold holdings before the war.

Of course, other factors have been added, but they cannot be grasped at all. It only takes a certain currency to be retained in a country for the exchange rate to be affected. Depending on the value of the foreign currency, an acceleration or deceleration can be initiated; after that, the currency of the country with little foreign currency sinks and falls. From this point of view, it is easy for certain individuals to damage the other state. It is difficult to determine how much of the country's debt stems from its own actions. It will be a considerable sum that has been gambled away by the speculation of certain people.

Question: Some say that the blame for the foreign exchange crisis lies in the change in the balance of payments of the poorer countries in relation to the other countries. In the case of Germany, this deterioration was mainly due to expenditure abroad, without any equivalent value coming in. This creates a balance in favor of the Entente. That is the decisive factor.

Rudolf Steiner: This could never have led to such a devaluation of the currency as occurred in Germany and Austria. The opinion that the discrepancy between gold currency and paper money is only on the surface is not correct because the fact simply exists that before the war paper currency was covered by gold currency. That is a real economic fact. And now this comes into consideration, that as long as there is essentially gold coverage for the paper currency, essentially no inflation takes place. That is how it is connected. When the gold is gone, inflation sets in. And then you can, with that senseless inflation, which was only possible because people did not feel the need to still count on the gold standard, make money as cheap as possible, of course. So because we have the gold standard because of England's power, one of the causes that first comes into play and then undermines credit is essentially the soaring price of gold when it is not there. And then, when the matter comes to credit money, the balance of payments begins to play its role. The matter must first get off the ground.

The cause of the devaluation of the currency lies before the war. You will remember that during the war it was always said that Germany would perish because of her lack of money. That could not happen during the war. But when the war was over and when the borders opened up a little economically, what was developed during the war came into consideration. That was what started the avalanche. Then all possible causes worked together. The balance of payments should only be invoked after the balance sheet figures have been made into named figures. As long as they are mere balance sheet figures, the balance of payments cannot be invoked. It must first mean something, not just a difference.

X: Gold just migrates abroad and has a devaluing effect as long as the gold standard exists.

Rudolf Steiner: Given our current economic circumstances – with the gold standard being the underlying factor – there is no doubt that countries that do not have any gold are essentially dependent on countries that have a gold reserve for the valuation of their products, and the value of money then depends on this. The matter can be understood quite well from the tremendous upheavals in the world; but the effects are so tremendous that one would still like to find “very secret causes”. But precisely this devaluation of the currency is not as hidden as one would always like to say; rather, it is based on the fact that, curiously enough, people today are such that they cannot evaluate events at all.

I often said after the war was over: Those who look at things in the right way will find that we have lived through as many centuries since 1914 in terms of changes that have occurred as we have lived through years in time. And actually, it seems like an anachronism that certain things have remained the same. You get the feeling that after five or six hundred years, the language would have changed; it's like an anachronism that people still speak essentially the same way as they did in 1914. But this has not made a very strong impression on people.

When you look back in history, you usually overlook larger periods of time. Just try to study the fluctuations in grain prices in 15th/16th century England, for example, and you will see that even with changes that did not occur so tumultuously, there are fluctuations in grain prices of up to twenty times the usual price. From this you can see how things that have happened in life since 1914 must actually be valued. People do not believe this because they have no sense of the qualitative side of life. People only noticed when what later happened became apparent – because money is an dishonest companion – when money was exposed. People only have an instinct for appreciating their wallet. It is only when things show up there – after all, people only think in terms of money – that they notice it in the exchange rate plunge. But if we now look at life qualitatively – please take Russia, take a whole complex of Russian life, permeated with the attitude from “Father Czar” to Lenin – what do you have to interpose in terms of metamorphosing forms? Basically, even the Russian devaluation of currency is only a kind of barometer for what has otherwise happened in life. So it is not so inexplicable. It is just the effect of a terrible and will become even more terrible. But the matter is simply understandable from the course of the other events.

Question: Do we already have a world economy today?

Rudolf Steiner: You can't formulate the thought that way. You have to take the state before the world war first. This was to a high degree a yielding of events to a world economic process. You only need to take international check transactions to have a yardstick for the high degree to which the world economy had already been achieved. People's thinking did not keep pace with the emergence of the world economy. They still stuck to the formulations of the national economy. It would not have been possible to keep up with the facts if people had kept up with the thinking, that all the torment of humanity through all possible customs barriers would have emerged even before the war. This was already in line with the Versailles world upheaval. People did not want to catch up with the thinking. They wanted to correct the facts. They opened a customs barrier somewhere at the border when something was wrong. But the situation is such that we had already achieved a high degree of world economy, despite all the tariff barriers. When there is already a high degree of world economy, the price you pay when you take the tram from Dornach to Basel depends on the conditions in America. Everything has gradually been incorporated to a high degree into world economy prices. So that was already there. In terms of its real value, much of it had simply been priced into the world economy to a high degree. Now, suddenly, the barriers caused by the war, which necessitated economic intercourse that was not in line with what had already emerged.

And since people still have not begun to think in more modern terms, an attempt was made at Versailles to correct things in the old style. The dismemberment of Austria was a mistake at any price, for example, the loss of the Austrian steamship industry, the price of coal, nothing. This only led to chaos, this desperate attempt to use old ideas to control the facts, while the world economy was already in place to a high degree. With limited thinking, one could say that national economies would arise again. But that is not the case. The fact that foreign exchange rates fluctuate so much proves that there is a world economy: because all kinds of goods from all over the world are in Austria, and so you can influence the world economy with them. These are things that prove that it is no longer possible to simply ignore the world economy.

Question: If America gives Russia loans to help Russia rise — by building railroads and so on — the result will be that the money will be put into Russia and that the Americans will simply have the title to the property without any way of getting it back.

Rudolf Steiner: If America were to decide to make this monetary contribution, in whatever form, it would be a gift. The great loan that has taken place must give rise to a gift. But America will not make up its mind to help Europe until Europe offers guarantees that it will not get involved in further military or economic entanglements. The only reason why America is not helping - for America would benefit from doing so because its own economy would become healthier - is that Europe presents a picture that says: what I put into it is lost. People in America are afraid of every loan. It will not come about unless Europe gradually comes to the point where, I might say, more personal credit would be given again. You can see from this how easy it would be, in principle, to help Europe, if only it were thought that the prospects had opened up at that moment, even if only seemingly, because Rarhenau was not an able man and Wirth was not either. But if, especially in the Entente and the defeated countries, new people came into the leading positions who had nothing to do with the pre-war situation, and if all people disappeared from public life who still represented the names of the past, then Europe would be helped at that moment: Europe would have personal credit. Things are so that the real credit no longer exists, that the personal credit must raise the real credit again. Then it could come to a slow ascent. If once Krone and Mark would rise a little, then there would be a completely different mood again, then there would be all kinds of causes that would only then emerge to further rise. But the moral level has sunk so far.

Objection: A survey of the causes of the suffering caused by the lack of foreign currency yielded the most contradictory answers.

Rudolf Steiner: The solution to this question lies not in the fact that everyone was wrong, but that everyone was right; namely, everyone hit on certain partial causes from their own circle of experience. This is borne out by the necessity of associative life. In economic life, there is no possibility for anyone to make a comprehensive judgment. So most people were right. But the one who seems to me to have been most right, in pointing to the deepest cause, albeit in matters akin to morality, was Edison, who was able to think entirely in economic terms and who said: The main thing lies in the principles according to which you select the people you take into the business. The shrewd businessman asks people to be hired questions that have nothing to do with the management. They will find their way into the management if they are only otherwise capable: That's why, as a businessman, I ask them questions that prove to me whether they still know what they learned at school, for example, or have forgotten it. If the person I ask tells me absolute nonsense, then the answer to my question is that I consider him to be not open-minded enough. Edison asked a whole series of such questions when he wanted to hire someone. If you approach the matter so practically, it makes a difference whether I hire someone who cannot tell the difference between wheat and rye and have him at the office desk, or someone who can distinguish between the two. And this is what people do not believe today. People believe that you can be a very capable accountant without knowing what a sunflower is. That is cum grano salis speaking. But what Edison gave as a suggestion seemed to me to be an extraordinarily apt one. It is economical, it shows how far the mind is taking hold of labor.

Question: What do current economic necessities demand of those who believe they have to found a new economy?

Rudolf Steiner: To a large extent, I try to give you partial answers to this question every day. For what is most important is to really grasp this transition of the national economies into the world economy, which has been taking place for about fifty years, and to stop working with the old economic categories. Instead, we need to understand how certain things have to be created today that were not there before and that can only be created out of thinking.

Take earlier economies, and you have them simply existing side by side. The even earlier state of affairs was where the economies were completely divergent. This economic state of affairs existed in the time when some areas were still simply to be conquered. It does not depend on the distances. You can imagine uncultivated France and the migrating Franks who found the empty areas. This gives rise to completely different economic conditions than if one came into a relatively closed area with more culture. The Visigoths had a different fate from the Franks because they moved into an area that could not be economically improved. And the greatest example is precisely for these disparate national economies, which then interact, the relationship between England and India, and its colonies in general. Here, dissimilar national economies have been incorporated into a common territory, either by conquest or by peaceful conquest. That is the first condition. The second is when the territories border on each other and are independent national economies. And the third is when a closed territory is created in such a way that nothing can coexist in the economic sense – for we are not talking about completely deserted lands. Now we must be aware that we are in the midst of a tremendous upheaval, and that the most important thing is the global challenge of the world economy, to which we must adapt. This understanding of all things in the national economy is what matters.

You have a very interesting example of how little people know about this in the book by Spengler, “The Decline of the West”, which also has an economic chapter. Spengler really speaks in excellent aperçus, but has no idea what things are really like. His concepts do not correspond to reality anywhere. In the economic field, it is particularly bad now, in the second volume, because Spengler has a relatively good insight into how certain ancient economic areas operated. He thus understands the peasant natural economy extraordinarily well on the one hand, and on the other hand, he also understands modern economic life quite well. He differentiates there – and this is Spengler's coquetry! — the Faustian from the Homeric. Now, the tremendously significant thing is that even a man as brilliant as Spengler cannot possibly realize that what has once been overcome apparently still enters into what comes later, so that all that he describes as ancient economics is, after all, right among us as a field.

Where we are dealing with what I have called purchase money, what Spengler attributes only to antiquity intrudes everywhere, except that the form has changed somewhat. He believes that whereas in his opinion money was once material money, today it is only functional money, while our money today must be based on the fact that the relationship between material money and functional money is being seen through: He throws around terms that have been so coquettishly tailored that they do not adequately describe reality. That is why there is something brilliant about Spengler's concepts. The dazzling effect and, on the other hand, the confusion caused by the way he mixes up the terms – it is indeed a danger for those who are not immune to this confusion. Our task is to think about the conditions as they are required.

We have this threefold coexistence: the very ordinary conquest and the coexistence of economies and the original natural economy, which is hidden by the fact that we use money for everything. There is this dispute between nominalists and materialists. The former are of the opinion that money is only a sign, that is, that the material it is made of has no value at all, but only the number on it; while the materialists are of the opinion that it is the material value that essentially constitutes the money. People argue about such things, whereas the fact of the matter is that in the one area, where we are still more concerned with agriculture and related matters, the materialists are right with regard to the function of money in the economy, whereas in industry and in the free life of the mind the nominalists are right; for there money plays the role that the nominalists ascribe to it. And then we have the interplay of the two. We have to grasp such things! People fight for things that are far too simple, while we have a complicated life.

Objection: But now we would have to rename our economics course to a “course in world economic theory”!

Rudolf Steiner: Well, the names remain. You see, there was even a time when morality was considered an economic matter. In the first and second Christian centuries, morality was considered an economic matter.

Question: I cannot understand the reciprocal movement of natural product – labor – capital and so on. The means of production has already undergone a transformation.

Rudolf Steiner: But the reversal does not refer to the fact that the means of production is produced, but that it produces. The transformation only takes on significance at the moment when the means of production ceases to be a commodity. It remains a commodity until the moment when it can be transferred to production. Where it begins to produce, the flow of national economic activity changes for the means of production. From that moment on, it is removed from the context in which it was, where it was a commodity. In the “key points” I have stated that it begins to be very much like nature because it can no longer have a price. It is just as much a part of the economic process as mere nature. So it moves back to nature again.

Question: Is this reflected in the balance sheet?

Rudolf Steiner: You mean this disappearance of value? It only appears in the balance sheet in abnormal cases. It only appears when someone, let's say, sets up a business, so to speak, brings about a sum of means of production, then goes under, and another takes it over, who is more skillful and succeeds. Then, when you put these two balances together, the one of going under and the one of continuing, you will find that a partial phenomenon of devaluation has been brought about. Through going under, the second - simply through the process of going under - has bought the sum of the means of production more cheaply than he could ever have had them otherwise. As a result, he has received a part as a gift. So that this could then be expressed in the balance sheet. If you were now to follow the consequences of such a process in the further course of the new balance sheet, you would have in it a much cheaper work, that is, one that has partly passed over without cost. In this way it could already be proved arithmetically.

Note: These are of course exceptions. Today, the abnormal is normal.

Rudolf Steiner: But this must gradually lead to monstrosity, because the means of production are directly transferred into pensions, while the land rent only arises when I invest the capital in it.

Question not noted.

Rudolf Steiner: You must not forget: if you put capital into a business, it means something essentially different economically than if you do not have the capital in the business. A completely different agent is at work when you have it in it than when you do not have it in it, although not having it in it is basically also only an illusion. Things lead to such illusions. You may ask: where, then, is the capital, say, the loan capital, that is not invested in enterprises? It is only present as production and land rent. And if someone wanted to have some money for themselves, they would have to withdraw it completely from the economic process for a while, thereby creating tension, and give it away again at a different value. They would come off badly because the money is progressively devalued – otherwise it is inconceivable that the process would occur radically, and that shifts the circumstances.

If we took a healthy approach to the economy, the right conditions would arise. Today, it is often comical to see how the wage issue, for example, is handled: people demand higher wages, which in turn lead to more expensive production conditions. Then the wages are not enough again. People demand higher wages again, and so it goes, and no one knows where it will end. These things make people see sand in their own eyes. Whereas in an associative economy, if we keep to the term 'wages', which is not correct, wages arise that can arise. Wrong wages do not arise.

Question: Why do wages have to 'arise'?

Rudolf Steiner: Try to examine the following: a worker receives an average of, say, two francs a day. Now you can say: that is a very low wage. - How can this wage become a very high wage without it being more than two francs?

Comment: By making the products cheaper.

Rudolf Steiner: Then you will get the final values first. Then you will see that everything I have said comes out. You do not have to keep putting the cart before the horse. You have to ask the question like this: We will leave him two francs. But under what circumstances will two francs be a wage twice as high as today, or three times as high? You have to start from the dynamic conditions. You always start from the static. Then you want the stationary things to cause movement. It is indeed: if I put five cents in my pocket, nothing in itself, but only something in relation to the whole economy.

Question regarding the depreciation of money: Will it gradually lose its value? Also as purchasing power?

Rudolf Steiner: As purchasing power, it has the same value until the end. This question is more a technical one of commerce, a question of how. The gradual erosion of money is not easy to imagine. It would require an extraordinarily bureaucratic apparatus.

I emphasize that I do not want to proceed programmatically, but only to say what is. For my insight is that we cannot create a paradise on earth by economic means. That would not work; instead, we can only create the best possible state of affairs. Now, one has to ask oneself why we have sunk below the best possible state. It is because the individual factors of the national economy cannot assert their true value at one point or another. It is possible today for a person who works in a spiritual way to be paid in a way that is not at all necessary for the national economy as a whole. He is either paid too high or too low. Both occur. But if he is paid too little, he immediately gives rise to an unhealthy change in prices as a result of his low pay. The same applies if he is paid too much. Corrections must be made to this, and it is only a matter of – without taking Foerster's things into consideration – which factors in economic life make this rearrangement, this circulation possible. So a circulation in which the tolerable mutual prices emerge, not only for goods, but also for the intellectual organization, and also for the necessary free intellectual life.

It follows directly from this that money must become old. The only question is how this can be done technically. And you would not be able to gradually wear out the money in any other way than by attaching coupons to the notes that have to be torn off at certain times, and by an official authority. This would result in a very complicated bureaucratic apparatus. But it is really never a matter of bringing about the erosion through such external signs, but rather that the real course of things brings about this value by itself. This happens when you simply give money, all kinds of money, more or less the character of a bill of exchange, that is, I mean the character of a bill of exchange in that there is an expiry date. Of course, this cannot be calculated in abstracto, but only approximately at the outset, assuming a specific moment. Then one must correct until the matter comes to a possible deadline.

Then it would be a matter of finding out what was needed for the global economy, which, after all, was already there for what was basically a very extensive local economy. This is the practice of the jubilee year in the Old Testament. It is something very similar to the aging of money: the remission of all debts. With a radical reduction of all debts, all economically harmful assets or capital also disappear. After all, you probably remember how long it was until a jubilee year – every seventy years. Now this jubilee year, compared to what would be necessary today in terms of the global economy, was determined a priori by simply defining the age of the patriarchs. I can't remember right now whether it is in the Bible, but in any case, the custom was originally to determine the human age because it was correctly calculated: if you take the course of an entire human life, it contains everything that is there in the form of gift capital in youth, then in loan capital and in trading capital, i.e. circulating capital. It was assumed that a person has the right to consume in his youth what he will later earn as a mature person, and then earn a little less when he approaches the end. In those days, this was seen as a kind of borrowing.

Now, you see, that was a priori; it would not look the same in the world economy. The time periods would be considerably longer. But it is also clear that when this gradual depreciation of money occurs, it occurs in mutual transactions themselves, because the initial year would be on the banknote. In real economic circulation, the money will then have a lower purchasing power, but a lower utilization power for all organization: the further it advances, the lower its utilization power. So that it can gradually change into gift money due to the decrease in its utilization power, and that it then changes back into young money, which can simply be reissued on the transition path. This must be brought about only through the associations. Thus labor has its highest value for products that are as close as possible to natural products, even though the worker does not get more than anyone else according to the price formula; but labor then has the highest value there in the national economic process. Only part of it goes to the one who works; the other part goes into the economic process without remainder. They have deprived the individual of the opportunity to enrich himself.

Question: How can money be used differently if it has the same purchasing power as young and old money?

Rudolf Steiner: If you start a business with young money, you are now in a position to invest in that business for a long period of time by putting young money into it; whereas with old money you could not invest in the business for a long period in the same way.

Question not noted.

Rudolf Steiner: You mean: once I have bought my means of production, then instead of money I have the means of production, and the money that I now give away is then in the hands of someone else. The money that has gone into production must of course remain there. But under certain circumstances this money can be transformed – it would not be transformed if the person concerned can consume it – but what is in it in production is a question of commerce. This will not be very bureaucratic, because the associations can ensure that within the enterprises, which are based on the same principles, nothing but money of a certain age is used. So the money is absorbed into the means of production. The other measure, that the means of production lose their value when they have become means of production, comes to help with this. These two things combine into one. Today you have it the same way, only disguised. The money that is lent for production does not go back, gets stuck in production. It is only held by the fact that the means of production can be sold again. Thus it is continually rejuvenated. But if the means of production cannot be sold, the money remains in its old age. You have to think in real terms, then the question will never arise: how do you make the money keep its age in there? Rather, you will say: that must happen - so the measure must simply be taken! This is an outwardly technical question. Of course, you could say this: there would be a certain possibility that such things would be circumvented by speculation; but speculation would certainly have much less ground in such a community than in one that gives money an indefinitely long value. In reality, money does wear out after all. Otherwise, that Pomeranian countryman could be right who says to himself: How big are the Prussian national debts? I want to invest a small capital in interest and compound interest, and that would be able to cover the Prussian national debt after so and so many years. This could never come about because all those who would be obliged to pay for this sum, which after all needed the appropriate cover, would perish. In some way or other, the guarantors would disappear, and the Prussian state would not get a penny of it for centuries.

So you see that pure money does indeed wear out. It is only a matter of taking these things into reason, which take place in reality and cause damage by not being in reason. That is why I can say: I only look at the real, not at an agitative being-shoulding. Because the things are there! It is a matter of asking: How can we rehabilitate the world economy?

Question: What is the relationship between state and money?

Rudolf Steiner: Through what I described yesterday, a Reichsbank, a state bank, would be impossible. The result would be a banking institution between those who have received gift funds and those who, through work, namely soil work, create new goods in their beginning. This rejuvenation would pass from the state to the economy. And that is what constitutes the further necessity. By passing over to the economy, this measure to make money young again would be linked to other economic measures, not to state measures. And as a result, quite different value relationships would emerge than now under the fiscal element. We would have something that already exists. After all, things are only hidden by the fact that they do not take place in the right place. We would have transferred a fiscal measure into an economic one. The tax authorities would have less opportunity to proceed economically than an economic association.

Question: What would be the nature of a different monetary basis?

Rudolf Steiner: It would be created by the fact that everything that is paper money, a money surrogate, would become very similar. The great differences of today are only caused by arbitrary measures. So the state banknotes and all other types of money surrogates would become much more similar to each other. One would have a unified currency, and it would be fairly unimportant what it was made of, because it takes on a purely nominal character at the end of the process; and by being reduced to its basic elements, it takes on a metallic character, which is what it should have to begin with. Currency would be something that is in a constant state of flux, but it would be fully adapted to the peculiarities of the economic process.

Question: Didn't you once praise the useful means of production as a monetary basis?

Rudolf Steiner: Let us ask ourselves: What determines the value of a particular currency over such a period of time during which this change takes place? It is determined by the available usable means of production. Suppose there is very little usable means of production available; then the thing will have to be converted very quickly. Money will accumulate everywhere, purchasing power will decrease everywhere due to the limited means of production, and so on. But if there are many usable means of production, the circulation will be different, and thus this money will have an increased value. In this way, we get the currency out through the usable means of production.

Question: Would something stable have to be taken as the substance, like gold?

Rudolf Steiner: As far as I can see, the real substance of money would be basically unimportant, so that you could put the year, which would then become the value, on paper as well. I cannot see that it would then be necessary to introduce such a currency as gold. It would only be possible to the extent that specialized economies were formed. But to the extent that a world economy actually exists - it is realized to the extent that the economy emancipates itself - it is possible to make money out of any material. What does money become as a result of what I am saying? Money becomes nothing more than the bookkeeping that runs through the entire economic area. If you wanted to introduce a giant accounting system that is not necessary, you could book all of this back and forth of money quite well in a corresponding place. Then the items would always be in the corresponding places. What actually happens is nothing more than tearing the item out of the relevant place and giving the person the appearance, so that the accounting system migrates. In a fluctuating sense, money is accounting. I cannot see that it should have any other than a decorative value, whether you make it out of this or that.

Objection: Gold would provide a certain standard.

Rudolf Steiner: That cannot be the case, and if it is the case, it is evident in this bookkeeping itself. The essential thing is that all monetary transactions are transferred to bookkeeping. Instead of transferring an item from the assets side to the liabilities side, you transfer the money.

Objection: It should not be gold because the devaluation could be avoided by withholding the gold at the end.

Rudolf Steiner: If there is a buyer for the gold. That would have to be the case, that is, the purchase would have to be advantageous. Then you would have to do the unnecessary calculation on top of everything else. Yes, that wouldn't help you at all. If, for example, you made a piece of jewelry out of it, you would be able to cheat with it.

These things must be considered for the purpose of economics itself. If you consider these things together, you will be able to evaluate what is currently only done on the basis of partial observation and inadequate speculation in the treatment of economics. There are always inadequate methods and insufficient observations.

Question: Which capital arose first in economic terms, commercial capital or industrial capital?

Rudolf Steiner: First, of course, commercial capital, historically, and in fact, trade itself is the very first work of exchange that has to be done. If you go back to primitive village conditions today, you have relatively little industrial capital. The village craftsmen do not earn proportionately more than the farmer. On the other hand, the people who trade earn something. This enables them to borrow. And then it goes further. Because capital does not arise if it is not usable. In fact, industrial capital arises only in third place. This is so much connected with habits that rational reasons cannot be found.

Question: Should Switzerland go to the national economy or the world economy? - Is there not a tendency in many countries to go back to the national economy?

Rudolf Steiner: You said that Switzerland had moved too early into the world economy because it had been shown that it had not done well? You cannot say that because Switzerland was unable to test the world economy in a natural way. What you now call the “goodwill” of neighboring countries has been brought about in an unnatural way by the war. If it had been able to continue to develop as it had until 1914, it would not have suffered to that extent, but would have continued to develop. Of course, the same damage would have occurred, which gradually became apparent at the time and which meant that one would have had to sail peacefully into the associative. As things stand now, it must be said, very little depends on Switzerland. For now we are dealing in the world with the tendency towards a world economy, but with its continuous disruption by the political intentions of the national economies, which have coincided with national aspirations. What is disrupting the world economy today is political intentions. Politics has begun to want to reduce everything back to the national economy. We cannot use Switzerland as an illustration here, because it is politically too powerless. Every now and then Switzerland is allowed to have a say when it is known that it will say what is wanted – Switzerland also says what is wanted.

So Switzerland cannot be held up as an example, but America, which is decidedly leading to an economic design and to an inhibition of the world economic design - it could also be that it would be very difficult to overcome this tendency of America towards an economic design. On the other hand, in a country organized like England today, which basically has only a pseudo-national economy and in reality a world economy, the tendency towards a world economy could develop. Because here you have England, over there India, South Africa, Australia, and so on. What is economically connected is basically spread all over the world. Thus England does not have the economy of the whole world at the same time, but it has the economic needs that are necessary throughout the world, which it must synthesize into something that must qualitatively take on the spirit of the world economy. That is what must necessarily lead to the world economy in the course of economic development. And in time, North American politics will have to submit to it as well; for the economy will simply make its very powerful demands on the hard heads of the people, and they will have to submit to the world economy. England could not make any progress if it continued to work in the merely economic sense. So you have to look for the real antagonism between England and America. Switzerland is not at all decisive.

Question: I cannot imagine how the stone in the crown of England could be explained in terms of its value only by human labor, not by its rarity.

Rudolf Steiner: The point is that economic values arise only when human labor or the human spirit is expended. This is the only way that economic values arise in the context of the division of labor. If you are now required to declare the value of this stone in the Crown of England, you must say to yourself: If it is possible to extract values from the ongoing economic process that the individual appropriates, then the value that has been generated can indeed be retained by the person in question. So if anyone wants to keep a million under our current circumstances, they can. He can accumulate the million. Then, for all I care, he can put this million in his stocking. He can now replace this putting-in-the-stocking with the other action of artificially attaching to some product, which is rare, the same value as to his money – and letting it pass into circulation. Then, by attaching this value to the thing purely conventionally and merely by his fiat, by his spiritual organization, he has attached this value to this object that he particularly likes. It is what has happened, merely under the influence; one cannot perhaps call it spiritual deeds, but spiritual measures are taken. The concept of rarity dissolves economically into the economic concept of spirit.

Objections are raised against the threefold order: It is said to be impossible to carry out the separation of the three limbs. The task of the threefold order could be not so much to build up as to separate negatively where harmful influences of the three areas on each other exist, and to leave the work at that. Especially with regard to the limitations of the three areas, one could not imagine anything. Economic life would be limited to what is called technology.

Rudolf Steiner: The thinking of the people who make this objection is not sufficiently developed. This is the main problem: our present-day educational institutions do not develop thinking enough. People can only form concepts that they store neatly next to each other. But the same thing happens in the human threefolded organism. If you take the optic nerve, it belongs to the nervous-sensory system; but it could not exist, of course, if it were not nourished, especially during sleep, by the nutritional system, by the metabolic system, if, that is, nutritional processes did not take place in it and if the inhaled air did not continually pass through the spinal canal into the optic nerve and a circulatory process did not also take place there. So that in the human organism something belongs mainly to the sensory nervous system or to the nutritional or rhythmic system.

The same applies to the social organism. It is necessary that the other two systems play a part in the economic organism. But in spite of all this, it remains true that essentially the sensory-nervous system is located in the head, and that head nutrition and head breathing are effected by another instance. It is precisely by creating these three instances that this interaction will exist in the right sense. I have always objected to the use of the word 'trinity'. The question is: how should the three elements, which are present in any case, relate to each other in a natural way so that they can work on each other accordingly? The spiritual organism will essentially be based on freedom. But of course the economic life will also have to have an effect on the spiritual organism, otherwise the professors would have nothing to eat. But this will have just the right effect if it comes from a different source, so that it becomes necessary to develop an economic organism in one direction and a spiritual organism in another direction, and then the state-judicial “organism”. Objections are raised only by those who imagine this threefold division as a division. It is well known that this has happened quite a bit. I found one commentator saying that he had given lectures on the three parliaments in the social organism. Anyone who imagines it this way imagines an impossibility, because there can only be a parliament in the state, not in the free spiritual life. There can only be the individual individuality, which creates a network of self-evident authority. In the economic sphere, there can only be associations. In parliament, all the functions will converge, and the right measures will be taken between the individual links of the social organism.

Question: In the tenth lecture, the pursuit of profit was compared to mass in the physical sense. Can the analogy be extended to allow work to be a function between commerce and the pursuit of profit?

Rudolf Steiner: According to the physical energy formula, \(e = \frac{m \cdot v^2}{2}\). In a similar way, economic energy would be formulated: the possible profits, which would be multiplied by a function of the speed of circulation: \(e = g \cdot f\) (circulation). The pursuit of profit must be multiplied by the speed of circulation, and then you get the figure for the work. This applies to the individual product. If you have a certain profit on it and you multiply it by the speed of turnover, you will have the amount of work. This amount of work is zero if you need to multiply the profit by zero, that is, if you sell immediately: \(0 = g \cdot 0\).

Question: Does the value of the stone in the Crown of England correspond to the tension between it and the need for luxury?

Rudolf Steiner: You explain the matter just like this, only through a different course of events: For the tension that arises through consumption is always the tension between the processing of natural products and the value that labor acquires through the spiritual organization. With something like the stone in the Crown of England, one cannot really speak of its value in a one-sided way. I beg you: what is it actually worth? It is only of value in a very specific economic order, and one that is permeated by a certain spirituality, through opinion, that is, through the spirit. It cannot be said that it has “this value” in itself, but only that it is worth something through the opinion attached to it. If, by buying it for what the seller asks for it, one were to put the seller in a position to have worked as much as he can get through what he receives, then something like an avalanche would have created an entire organization of labor. Just as in physics you need not take into account anything other than the mutual relationships when you allow a small snowball to form an avalanche – then you do not need to change the formula – so in the same way you do not need to change the formula in the economic consideration by the mere fact that such special circumstances arise under which, purely externally viewed, facts are created like this, that a rare product is equivalent to a huge amount of work. This is only possible in the context of the national economy.

Dr. Steiner. Gentlemen, someone has handed in a written question concerning the thyroid gland.

Question: The thyroid gland can become enlarged and when it does a goitre is formed. Since goitres may exert pressure on the windpipe and thus cause a problem, operations have been performed on this gland, whose function is unknown. Soon after surgery, however, a strange phenomenon was observed. Persons whose whole thyroid gland had been removed exhibited both physical and mental changes. Growth stopped, limbs became enlarged and perspiration ceased. There also was evidence of some mental retardation. When the cause for this was realized, one sought to remedy the defects by feeding the unfortunate persons thyroid glands taken from freshly slaughtered calves or wethers. The result was astonishing. All negative effects subsided. But these results were short-lived, and within a few weeks the trend was reversed again. The patient's stomach also rebelled. Then sections of thyroid glands were introduced into the throat. Again, the results were amazing, but signs of deterioration reappeared.

Injections made with preparations from thyroid glands were not much more successful. An English firm has achieved surprising results with certain tablets even in cases of cretinism. A short interruption in their use, however, reverses the process of recovery. What is to be expected with the continued use of these tablets?

Dr. Steiner: Gentlemen, if you take into consideration what we have already discussed here, you will be able to understand this matter fairly well. You see, until about seventy years ago, until about the middle of the nineteenth century, no particular significance was attached to the thyroid gland, which is located here in the front of the neck. It was thought to be like the appendix or some other organ that had had a function in man's ancestors but was no longer needed. In short, no special importance was attributed to this gland. Then it was noted that its degeneration, with the formation of a goitre, had a specific effect even on mental faculties. Its purpose and pathological enlargements were studied in cretins, that is, retarded and mentally deficient people. One can observe that in certain geographic regions persons are both retarded and afflicted with goitres. It is known throughout Europe that in Halberstadt the retarded population has goitres so large that in some cases they extend over the shoulders.

Now, it was thought at first that if pathological enlargement of the thyroid had such a pronounced influence on the mental faculties, surgical removal was indicated. This is how they think today. A great preference is shown for surgery because significant progress was made in surgical methods in the nineteenth century; this has become the most important aspect of medicine, that most deserving of recognition. So the first thought is to remove those organs that apparently have no significance. This is the procedure followed in the case of the appendix. It is surgically removed if it shows any pathological symptoms.

This manner of thinking ignores something I have repeatedly emphasized here. You will recall that when you observe man in his totality, you often note that something is present in certain processes of the child that has effects much later on, even in advanced age. Ordinary medical opinions are concerned only with what is demanded at the moment. Therefore, steps are taken that seem most beneficial at the given moment, but no attention is paid to the future course of events. It is difficult to make an overall judgment about these matters because, if a patient is not operated on when he exhibits symptoms of appendicitis, for example, he may immediately succumb. Then, of course, the doctor is held responsible. The point is to investigate other than surgical means to solve these problems. You are familiar, perhaps, with the fad these days of letting youngsters go about as much as possible with bare feet and legs, even up to the knees. Well, this habit contributes to the degeneration of the appendix! Of course, once the appendix has become inflamed, it must be removed, but when you see matters in a larger context, you know how to prevent such problems from arising in the first place.

Now, it is correct that the thyroid gland has great significance and important implications for the whole human organism. As I have said, people have been aware of this since the last half of the nineteenth century. They know that a malfunctioning thyroid does not allow the use of the body for mental activities in a normal way. Everything referred to in the question actually occurred. If a portion of the gland was allowed to remain, the patient did, indeed, make some improvement. He was relieved of the enlargement and his mentality was not adversely affected. But when the whole thyroid was removed and nothing of the gland remained, the patient became more retarded than before. Naturally, it was learned from this that even a diseased thyroid gland has significance for the expression of man's faculties of soul and spirit.

The secretion of the thyroid has been administered to patients in a number of ways. Incidentally, the fluid contained in a gland is called a secretion. Injections of thyroid substance could result in an increase of thyroid fluid in the body, but this method led to no lasting improvement. The organization of the body did not seem to respond favourably to what was being administered. So far, the best results have been obtained by administering thyroid fluid in the form of these tablets, which are absorbed by the digestive system. Introducing the substance of the thyroid into the stomach and hence into the blood stream permeates the body with the secretion of this gland. This remedy proves that the body needs such a secretion. It shows, too, that when the thyroid is functioning properly, its secretion passes into the blood in minute amounts and penetrates the entire body. If the thyroid secretion is introduced into the stomach rather than directly into the body, it also finds its way into the blood stream. But you understand, of course, that administering thyroid by way of the stomach is effective only as long as it comes to circulate in the blood. If the tablets are discontinued, the amount of thyroid in the blood will decrease. So persons who receive thyroid substance in this manner must take it continually. Then it does remain effective.

It can be said that this does, indeed, offer concrete proof for materialism because we see that we only need to administer certain substances to man in order to increase his mental faculties. The same is true when the substance is manufactured within the body, as is the case with thyroid secretion. By thoroughly checking into all the experiments made in this area, however, we discover something else.

Thyroid glands are quite large, as you may know, and are located in the front of the neck. Within them are many small glands, to the right and left, that are no bigger than the head of a pin. They secrete a substance that is produced also in other parts of the body. Similar, but not identical, substances are secreted by small glands in various parts of the body. Though it differs from the substance produced in the small glands of the thyroid, such a substance, for instance, is secreted in the adrenal glands. Tiny glands like these are found in other parts of the body as well. In other words, the body contains traces of substances secreted in various parts of its organization. These substances are called hormones. Such a hormone that permeates the body in minute amounts is also contained in the tiny glands within the thyroid.

You may picture it this way. If you take a fish out of its watery environment, it will die because it cannot exist in air. Likewise, these hormonal glands, which resemble minute living organisms, can survive only within the thyroid, the real purpose of which is to provide a place where they can function. When the thyroid is surgically removed, the body is deprived of the hormones it produces. If these minute glands are removed with the thyroid, the prognosis is negative, but if enough of the thyroid containing them remains, then things don't look so bad. Enough must be left to permit some of these small glands to continue to function. When the entire thyroid gland is cut out, the hormone producing glands are also removed and that is harmful. Less radical surgery that doesn't remove them all is successful. Preferably, then, just parts of the thyroid should be removed; the hormonal glands should be allowed to remain. But, if the secretion from the missing amount of thyroid substance containing these glands is replaced with tablets, so that the blood receives what it needs from them and also from passing through the remaining glands, the patient's general state of health may be expected to improve. The matter is really rather complicated, and much depends on how the thyroid secretion is produced.

When an experiment is performed on a wether in which only part of the thyroid is removed, leaving behind the part containing the hormonal glands, then it is found that the secretion does not have the medicinal value it would have had the entire gland been removed. When the entire gland is taken, however, the hormone produced by the hormonal glands combines with the thyroid secretion, permeating the blood of the thyroid, and an effective extract can be obtained. But, if only parts of the wether's thyroid is removed, leaving the hormonal glands behind, the thyroid extract will be less effective; then, such tablets will not work as well. So you see that not everything depends on the thyroid gland as such. Its purpose is only to nourish the minute hormonal glands, which, as you can imagine, were not discovered for a long time. Being so small, how could they have been noticed?

From all this you can understand that man's well-being simply requires certain substances. You need only recall that his mental faculties are altered also when he drinks wine, for instance. Cheerfulness is engendered by drinking wine but, later, things are likely to change. The next day his mood is usually quite the opposite of cheerfulness! So it is with this substance that is contained in the hormonal glands and that are required in minute amounts throughout man's body. He makes use of this substance, and animals need it, too. Much can be accomplished by working with such substances in the organism.

Well, in recent times, this has led to a more attentive examination of these delicate substances. What is the basis of the efficacy of such substances as those secreted by the hormonal glands? Gentlemen, you can understand this only when you realize that the body is constantly subject to processes of deterioration. It is a peculiarity of the organism that harmful substances are forever being formed in it. The substances secreted by the hormonal glands neutralize the destructive effect of these poisons that form in the body. It is a most interesting phenomenon that the processes of life consist in man's constantly poisoning himself, and then continuously counteracting the effects of the poisons by means of these little glands placed within his system. Take the case of the adrenal glands. If those little hormonal glands work properly, man appears the way you all look. But when they malfunction, his complexion turns brown, a yellowish brown. Such an affliction is called Addison's disease, because a Dr. Addison was the first to observe it. We once had such a patient who was a member of our society and who was looking for a cure here. This brown discoloration and darkening of the skin is caused by certain harmful substances in the body that are not neutralized by those substances normally produced in the adrenal glands. Likewise, mental retardation is caused by a lack of the substances normally produced in the hormonal glands of the thyroid.

When administered in tablets, hormones that act as antidotes are transmitted to the body, and their effects have led doctors to pay closer attention to this entire sphere of problems. It is interesting that this question also arises in connection with Steinach's Theory. Since this theory is somewhat related to our topic, it will be worthwhile to consider them together. Steinach's theory is just about ten years old now. About ten years ago, a professor in Vienna sent a report of his experiments to the Academy of Sciences. Now known as Steinach's theory, the report is based on the fact that the body is continually permeated with hormones, the products of minutely small glands. It is interesting that the body seems to be constantly out to poison itself by its organs, but tiny glands located everywhere in the system produce antidotes. Starting at the neck, we have the hormonal glands of the thyroid, which enable us to speak rather than to stammer, and to connect thoughts with our speech. The hormones produced in the adrenal glands prevent us from turning dark and they ensure our attractive light complexion. Also, hormonal glands of the reproductive organs emit small amounts of delicate fluid. These glands, of the gonads, are found in animals and humans, both male and female. They are only slightly developed in the child, but when he or she reaches puberty in the fourteenth or fifteenth year, they become fully developed. In the case of the male, the gonads or testes are located in the scrotum. They contain small hormonal glands whose secretion penetrates the whole blood circulation in minute dispersion.

Steinach's experiments have demonstrated that this particular hormone has the characteristic of suppressing the aging process. Scientists have been concerned with aging for a long time, and long before Steinach's theory became known, a physician-scientist in Paris named Metschnikoff published some interesting things about the phenomena of old age. His point of departure was that the body continually poisons itself. He emphasized the fact that poisons are constantly accumulating in the intestines and that man ages from the effect of the microscopically small animal- or plant-like creatures that produce them.

Now, Steinach concluded that the aging process, this quite natural and normal process of deterioration, can be counteracted. He conducted his experiments mainly with rats; the most important tests were with rats. In cases like these, it must be said that experiments with animals are not completely applicable to humans. Not everything that occurs in animals, especially in rats, can be applied unreservedly to man. After all, the organism of the animal is different from that of man, and I must say, even if one has a low opinion of the size of the human being when compared, for example, with the vastness of the universe, yet a difference does exist between the physical organism of a human and a rat.

Most of the scientific results were obtained, as I have said, through experimentation on rats, which are particularly suitable for such tests. You see, the normal life span of the rat is about two and a half years, and before it dies it exhibits quite pronounced signs of aging. Rats are quite agile and aggressive creatures, and when they age, they turn dull and listless. They lose their fur in some spots and become bald; in other spots, their fur turns bristly and ragged. Also, they lose their appetite. Their age is shown particularly in that, when males are locked together in a cage, they don't fight but keep to themselves, and when an aging male rat is placed with a female, it shows no interest in her.

Of course, one has to be careful with such experiments because rats are susceptible to all kinds of disease. They easily become tubercular and frequently become infested with tape worms or other intestinal parasites. Also, rats are subject to infectious diseases. Therefore, if a rat exhibits the symptoms I have described, it must be determined whether they are caused by such diseases or are truly signs of old age. So to conduct such experiments with rats one must start with quite a number and constantly examine them for intestinal parasites. Those with coarse fur or loss of hair due to illness must be eliminated. Eventually, you will be left with a few rats that are truly old.

Steinach experimented primarily with male rats. The aging males that were listless and had bald spots, that had lost hair and were no longer interested in the females, were treated in the following manner. When not breeding, the gonad of the male rat is found above the scrotum. This gland constantly discharges fluid into tiny canals. It can be pictured like this (drawing). Minute canals lead from the gonad into the spermatic cord, from which the semen is discharged. The hormone of the gonad passes through this canal and is mixed with the seminal fluid, which becomes permeated with the hormone. When the animal is young, this gland produces the hormone that passes through these canals, or vasa deferentia. From them, it enters the spermatic cord, so that the semen ejaculated by the male that impregnates the female contains this hormone. It is also diffused throughout the body. The principal part of the hormone flows into the spermatic cord, while the rest is distributed in minute amounts throughout the rat's organism by the blood.

Let us now take the case of a rat that is getting old and feeble. The feebleness and slackness of the body is indicated in that it can no longer control its excretory functions, having lost control over them. You may have heard that this happens to people who are executed. This is what happens when the body becomes slack. When the organism ages, too much of this hormone flows into the spermatic cord, and too little is retained in the body. The body then contains the toxic substances of advanced age because the gonadal hormone is lacking and therefore not effective as an antidote. This explains why the rat's organism ages in the first place. It ages because various toxic substances produced in the body come to permeate it.

When a child reaches puberty much of the hormonal substance passes into the body. This is not the main point, however. Because the organism is young and vigorous, it can retain the hormone it receives and allow the surplus to be discharged.

Now, when the rat grows old, too much of the hormone is discharged. So Steinach tied off the tiny canal with a small thread, thus closing the passage from the gonad to the spermatic cord. Since the hormone now could not leave the gonad, it entered the body through the blood. You understand how that worked, don't you? When you shut off a pipe, the fluid backs up. He closed it off here (indicating drawing), made a ligature, as it is called, and thus caused all of the hormone to penetrate the body. The rat became lively again and even grew new hair. When it was put with females, it showed sexual desire and attacked them, though it could no longer impregnate them because the operation had rendered it sterile. This was really what happened.

You see, it is actually quite simple. The aging body lets too much hormone escape, but because of ligation it is retained and the aging process is reversed, even if only temporarily. It is quite interesting to observe how these male rats become agile and youthful again after the ligature is made in the spot I have indicated. These ligatures can be made in a variety of ways. The way I have just drawn it is a method that is rather complicated because an operation must be performed to reach this spot. First, an incision must be made on the outside, then the thread must be inserted around the canal to tie it off. Experiments have been performed in other ways, too. For example, the testicles, particularly in the case of humans, were destroyed with X-rays, thereby holding back the gonadal hormone. In short, all of these tests are based on somehow retaining the hormone in the organism. You see here the similarity with the thyroid gland. In it, too, it is a question of getting the hormone into the blood. It is the same with the gonadal hormone, except here it is done by closing this canal when a person has become incontinent in old age.

Steinach has successfully continued these experiments over the past ten years and today it can indeed be asserted that what was proven to occur in rats applies also to a certain extent in humans. Such experiments have been made on humans and similar results obtained by using ligatures or by introducing the hormones of a young person directly into the gonads. This has been done with injections or by injecting directly into the testicles the seminal fluid of a young animal. In other words, all kinds of ways have been tried to reintroduce this hormone into the body. Results have indeed been attained, and although they have been generally somewhat exaggerated, they cannot be denied. Experiments were, in fact, performed not only on rats but also on old people who had become feeble; they then regained some youthfulness. Of course, the effect doesn't last too long. The human body can live only a certain number of years and it is not at all certain yet whether the life span can be lengthened by these means. A man can be somewhat rejuvenated but, at present, one cannot lengthen his life. It is feasible, however, that the life span, too, will eventually be lengthened this way.

You understand, though, that all these matters also have their negative aspects. It is true, is it not, that some people are poor sleepers? If one treats young people who do not sleep well with sleeping pills of opium or morphine, they will certainly sleep better, no doubt about it. One can't argue against it, but the fact is that if sleeping pills and related chemical medication is administered repeatedly to young people, it will, after a while, weaken the body. It will have an increasing need for the medication and will come to be unable to live without it, thus becoming addicted to it. Then, in later life, one will have to deal with a person who is not in full possession of his health. So it is much better to try to cure insomnia by psychological means, combatting it in a more inward way. If the patient is encouraged to think and concentrate on one word, he will gradually gain the strength from within to fall asleep. This method is much better because, this way, man does not weaken himself. The effects of sleeping pills are uncontested; it is indisputable that a person sleeps better with them, but it should really be considered from another aspect. One should try to induce sleep from an inward, mental direction. Of course, this method is more difficult and is related somewhat to education. If children are raised correctly, they can easily be induced to get the right amount of sleep every night. Then later in life people needn't be given sleeping pills if they have been treated properly in school.

These rejuvenation methods can really be compared to taking sleeping pills. Yes, gentlemen, the following is of particular interest. I have told you that Metschnikoff had already dealt with the symptoms of old age; as yet, Steinach's experiments were unknown. You may be surprised to learn that a thoroughly materialistic doctor recommended that his patients read things like Goethe's Faust! Really, they were told to read books like Faust; this was supposed to rejuvenate them.

There is much truth in this recommendation. If in old age one has an interest that completely occupies one's soul and spirit, something that fills one with enthusiasm, this will make one youthful. The meaning of “enthusiasm” is close to that of “inspiration.” Something spiritual enters the mind. Otherwise, the term used would not be “enthusiasm” but “embodiment,” which connotes a material process. When addressing the public, even materialists do not say, “Let us be full of embodiment!” Though they deny the spirit they nevertheless say, “Let us be full of enthusiasm!” Being filled with enthusiasm is indeed a source of rejuvenation. Of course, one cannot prove this in rats! It is a source of rejuvenation in humans, however, and if observations in life were made in this direction, one would discover that, depending upon a man's health and stamina, whatever rejuvenation could be brought about would be attained much more easily if he could be allowed sufficient time to engage in some mental activity. Mental or spiritual activity has the peculiar effect of holding together and keeping strong the glandular walls. If a man is interested only in superficial matters all his life, his glands and vascular walls tend to become slack more quickly than if he has an interest in spiritual and mental activities. If he has been educated correctly as a child, and then given enough time to permeate himself rightly with spirit, he will not need such ligatures because he will maintain his strength on his own and his body will retain what it requires.

It is a different matter with the thyroid gland. Here, medical means must quite often be resorted to because it is extremely complicated to improve it with, well, spiritual means. Yet, here, too, results will be attained and have, in fact, already been achieved. If a patient repeats certain sayings day after day in a song-like speech, carefully prescribed in a definite way, the size of the thyroid gland will decrease.

So it must be said that hormone therapy is just as effective as medications are for insomnia. It would be better, however, if humans would at last begin to think about accomplishing things in other than just materialistic ways and would finally consider giving civilization the opportunity that would afford everyone a chance for a certain degree of spiritual activity. Then these manipulations wouldn't be valued quite so highly, because it would be recognized that one becomes feeble in old age in the first place because of the negative aspects of our civilization. All these operations on humans that give them a few months of rejuvenation in old age basically serve only to equalize what has already been damaged. From the medical standpoint it is a brilliant, remarkable accomplishment, but when it is viewed in a larger cultural context, one sees its darker side as well.

Of course, we must consider something else, too. I said earlier that administering sleeping pills to younger persons actually weakens them. If rejuvenation treatments are resorted to in elderly persons who are shrivelled up and can barely grope about, it is naturally a source of great happiness for them to be able to act a bit lively once more. One doesn't have to be quite so concerned that such a rejuvenation treatment could be harmful to them because it is performed at an age when it becomes difficult to check for any damaging after effects.

Our materialistic world conception is attaining remarkable results today, but when they are seen in a larger cultural context, they take on a different appearance. This is why I always stress that people should be concerned with protecting children in school, and also in later years, to prevent them from getting premature symptoms of old age. This problem is not confined to a certain segment of society. Nowadays people hardly thirty run around with terribly bald heads, particularly those who belong to the so-called affluent professions. Premature baldness is caused by the unnatural forms of higher education. It would be much wiser to educate people in such a way that the body would be in a position to maintain everything for as long as it retains its life forces.

This is what I can tell you about these matters. It is always interesting to view such things from both sides, which, indeed, they have. Anything else concerning this I shall talk about another time.

Dr. Steiner: Well, gentlemen, perhaps one of you has a question you would like to ask me today.

Question: I would like to know why people with blond hair are becoming increasingly scarce. Formerly, there were many fair-haired people in the region where I was born, but now there are far fewer. Why is this so?

Dr. Steiner: Your question fits quite well into our discussions, and I can consider it after I describe the human eye for you, as I promised to do earlier. We have already studied the ear; now we shall look at the eye. You may have noticed that blond hair is closely linked with blue eyes; as a rule, blonds have blue eyes. Your question relates to this matter, which you will understand fully when we examine the eye.

Eyes have great significance, indeed, for the human being. It might be assumed that people born blind do not benefit at all from the eyes; nevertheless, they are still part of them, and they have the function not only of seeing but also of influencing the entire nervous system, inasmuch as this originates in the brain. The eyes are still there in one who is born blind even though they cannot see. It is placed in the socket but something is wrong internally, especially with the optic nerve. In addition, the muscles that control eye movements exist also in a blind person, and actually continuously influence the nervous system. Thus, the eye is, indeed, one of the most important organs of our body.

The eye, which is really like a miniature world, is placed in a cavity formed by the skull bones. You might tell yourself that it is something like a tiny world. The optic nerve fills out the retina and terminates in the brain, which I shall outline here (sketching). So, if this is the eye seen in profile and sitting in the eye-socket, then here on the right is a canal through which the optic nerve passes. The eyeball lies buried in fatty tissue and is surrounded by bony walls. Attached to it are six ocular muscles that extend back into the bony walls of the socket. These bones are directly behind the upper jawbone.

In the anterior part of the eye is a completely transparent, clear tissue through which light passes. That the tissue looks black is an illusion; in reality, you see through the eye to its rear wall; you are looking through the transparent skin all the way to the back of the eye. The round blackness you see is the pupil, which looks black because the back of the eyeball is that colour. It is like looking through the window of a dark room; if you think the window itself is black, you are mistaken. The interior of the eye is completely transparent. This tissue is tough and opaque here and transparent in front. Within it and toward the rear is another layer of tissue possessing a network of fine, delicate blood vessels, which thicken here. Around the pupil is the iris, which in some people is blue and in others gray, green, brown or black.

Between the iris and the transparent tissue is a transparent fluid. Where you see the round blackness is the transparent skin, the cornea; behind that is the anterior chamber. It consists of living fluid and is shaped somewhat like a little glass lens. The actual lens of the eye is located here, where these delicate blood vessels come together and where the iris is formed. This structure, called the crystalline lens, also contains a living fluid. Its outer cover is transparent, permitting you to see the blackness behind it. Unlike a glass lens, it is mobile; it moves especially when you need to focus on something nearby. In that event, it is shaped like this (sketching), thick in the middle. When you need to look into the distance, it is bent like this, thin in the middle.

Next to the iris are delicate little muscles, which we tense to make the lens thicker when looking at something close up, or relax to make the lens thinner. A person's living habits also affect the lenses. If you often use your eyes for close work, like reading or writing, gradually the lenses become permanently thick in the middle, and you become near-sighted. If you are a hunter, however, frequently looking into the distance, then the lenses become thin in the middle and you will become far-sighted. Another thing to consider is that in youth the tiny muscles located in and around the iris are still strong and elastic, and we can accommodate to our field of vision. In old age they become slack. This explains why many people become far-sighted with age, but this problem can be corrected. If a person's lenses are too thick in the middle, glasses are prescribed with lenses that are concave. These will compensate for the thickness of the eye's lenses. Some people even have a twofold problem, needing one set of glasses for clear distance vision and another set for close up. If the lenses of the eyes are too thin, the glasses will have convex lenses. Their thickness is added to the lens of the eye and compensates for the defect. You could say that we are able to see because we can correct the defect of the lens. The lens in our eye is like that of our glasses: near- and far-sighted. But the lens in our glasses stays the same, while that in the eye is living and can adjust and accommodate itself.

Behind the lens is also something like a living fluid. It, too, is completely transparent, permitting light to pass through everywhere. This gelatinous and crystalline substance completely fills the interior of the eyeball. So here in front is something like transparent “hard water,” the aqueous humour; next comes the transparent lens, and then comes the vitreous humour, which is also transparent. The optic nerve enters the eye here, and reaches approximately to here.

This optic nerve is extremely complicated. I have drawn it as if the main nerve fibre simply divides here, but there's more to it than this. There are actually four layers of nerves surrounding the vitreous humour. This is the outer layer of the nerve (sketching), which acts like a strong mirror. When light enters the eye and hits the layers of the retina, it is reflected everywhere. It does not go into this (probably referring to the nerve canal) but stays in the eye. The outer layer acts like the wall of a mirror and reflects the light. A second layer of nerves intensifies this reflecting capacity. As we have said, the nerve that lines our eyeball consists of four layers. The outermost layer and the second outer layer reflect back all the light into the interior sphere. Thus, within the vitreous humour we have actually only reflected light. A third layer of nerves consists of the same substance that makes up the gray matter of our brain. The outer parts of our brain are gray matter, not white. Another “skin” constitutes the fourth layer. You see, the vitreous humour is placed within a complicated “sack.” This enables all the light that penetrates into the interior of the eyeball to be reflected within the vitreous humour and to live therein.

What we have in our eye is something that looks like a complicated physical apparatus. What is it for? Well, imagine that a man is standing somewhere. When you look at him, an inverted picture is produced in your eye because of the lens and vitreous humour. So, if a man stands there (sketching), you have a small image of him in the eye, but owing to this apparatus, it is an image that stands on its head. The eye is just like a camera in this respect; it is much like a photographic apparatus in which the object photographed appears in an image upside down. That also happens in the eye; since it is a mirroring device, when light enters, it is reflected. Thus, in the eye we have the image of a little man. Even with all our modern sophisticated machinery, something like the human eye can certainly not be manufactured. We must admit that it is altogether extraordinary and marvellous.

Now, picture to yourselves the starry heaven; form an image of the light-filled sphere around the earth, and then reduce this picture until it is quite small. What you then have is the interior of the human eye. The human eye is actually a world in miniature, and the reflections in the eye resemble myriad surrounding stars. You see, these outer walls do not reflect evenly. There are many tiny bodies, which, like miniature stars, radiate light toward the centre. If we were as small as the image of the human being in the eye and could examine it from inside, its interior would seem infinitely large. Our impression would be the same as when on earth we look up to the glittering stars at night. It is indeed so. It is interesting that the eye is like a miniature world and that the tiny human image produced in the eye by reflections would have the same feeling, if it were conscious, we have at night under a starry sky. It is really quite interesting!

Well, I said, “... if that image possessed consciousness.” But if we did not possess our eyes, we would not be able to view the starry night. We see the night sky and its brilliant stars only because we have eyes; if we close them, we do not see the stars. Nor could we see the starry firmament if the eye did not already contain within it a miniature world. We say to ourselves that this miniature universe really signifies a big world. This is something that must be clearly understood.

Imagine that a man shows you a small photograph of himself or another person. You will realize that even though it is small it was taken of a regular-sized man. You are not encountering the actual person in this picture and, likewise in the eye; in reality you have only this tiny miniature starry sky within you. You then say to yourself, “What I have here before me is the `photograph' of the immense starry sky.” You do this all the time. You have within you the little starry sky of the eye, and then you tell yourself, “This is the photograph of the great starry sky.” You actually always picture the real starry sky from the miniature firmament in your eye; you conceive of the universe by means of this picture within. What you really experience is the infinitesimal firmament in the eye.

Now you might say, “Yes, but this would be true only if we possessed just one eye like the cyclops, whereas we have two eyes.” Well, why do we have two? Try this: Look at something with only one eye. It will appear to be painted on a backdrop. We do not have two images of an object, which we see in proportion and in the right dimensions only because we possess two eyes. Seeing with both eyes is like grabbing your right hand with your left. We are conscious of ourselves because from childhood we have been used to saying “I” to ourselves. The little word, “I,” would not be in the language if our right side were not aware of our left. We would not be conscious of ourselves. We become so accustomed to the most important things that we take them as a matter of course. A hidebound philistine would say, “The question of why one says “I” to oneself does not interest me. It goes without saying that one says “I” to oneself!” Well, he is a narrow-minded and prosaic person. He does not realize that most subtle matters are based on the most complicated processes. He does not know that he became used to touching himself as a child, that is, touching his left hand with his right, and thus grew accustomed to saying “I” to himself.

This fact can be traced in human culture. If we go back to ancient times, to the days of the Old Testament, for instance, we find priests who—excuse me for voicing such a heretical opinion—often knew much more than the priests nowadays and who said, “We want to teach man self-awareness.” So they taught people to fold their hands. This is the origin of folding your hands. Man touched himself in order to find the strong ego within him and to develop his will. Things like this are not said today because they are not understood. Priests today simply tell members of the congregation to fold their hands in prayer; they do not give the meaning of this gesture because they themselves do not know it anymore.

When we see with our two eyes, we feel that what is there in the light is in fact spatial. If we had only one eye, everything would appear as if painted on the firmament. Our two eyes enable us to see things in three dimensions and to experience ourselves as standing within the centre of the world. In a good or bad sense, every man considers himself to be the centre of the world. Therefore, it is of great importance that we have two eyes.

Now, since it is so important for man to use his eyes for seeing, we overlook something else about them. We are not so ignorant in the case of the ear. I believe I have mentioned already that when we hear we also speak; that is, we ourselves produce what we hear. We can understand a spoken language only because of the Eustachian tube, which runs from the mouth into the ear. You surely know that children born deaf cannot speak either, and that people who are not taught to speak a language cannot understand it either. Special means must be used to gain an understanding of what has been heard.

It does indeed appear that seeing is the only purpose of the eye, but a child learns not only to see with its eyes but also to speak with them, even if we don't pay much attention to it. The language of the eyes is not as suitable for everyday use as is the language directed to the ears, but with it you can discover whether a person is telling a lie or the truth. If you are the least bit sensitive, you can discover in the way he looks at you whether or not he is telling you the truth. The eyes do speak, and the child learns to speak with them just as it does with its mouth.

In the language of the ear the larynx, with its function of uttering sounds is separated from it, and thus there are here two separate aspects. In the case of the language of the eye, there are muscles right within the organ and also around it. It is the muscles that make the eye into a kind of visible organ of speech. Whether we look somebody straight in the eye, or have a shifty look, depends on the muscles that surround the eyeball. In the case of the ear, it is as if it were contained within the larynx, as in fishes. In man the ear is separated from the larynx, but in fishes they are joined to form one organ. The act of speaking is separated from hearing, but with the eye it is as if the larynx with its muscles surrounded the ear. The eye is situated within its speech organ as if the ear were placed within the larynx. In humans it is like this (sketching). Here we have the larynx, the voice box, which goes down through the windpipe into the lungs and up into the palate. It enables us to speak. From the mouth we have a connection with the ear.

Now imagine that the larynx is not like it is in humans but that it spreads out much wider. Then we would have the broad larynx that Lucifer possesses in my wooden statue. The larynx is so large that the head fits in between, and it reaches up on both sides to surround the ear. With this organ we would both speak and hear. With the eye we do just that; we speak through the muscles that surround the eyeball, and through the eye we simultaneously see. So in some respects the eye is conceived like the ear, but in other respects it is, of course, quite different. This, then, is the purpose of the muscles I have drawn here.

We can say that we speak of what we know, and we consider those who say things of which they know nothing to be more or less fools. We say of such people that they are talking to themselves, shooting off their mouths. As a rule, however, sensible and rational people express what they know. We do not speak consciously with the eye, however, for we would have to be shrewd fellows, indeed, if we could consciously speak the language of the eyes. This process is unconscious and accompanies our other behaviour. The people in Southern Italy, for example, still speak of an “evil eye.” They still know that a person who has a certain look about him is false. They talk of an evil eye because they sense that the eye expresses the whole nature of a man without his being aware of it. This superstition in Southern Italy goes so far that some hang little charms or religious medals around their necks as protection from it.

So you see how marvellously the eye is formed. A person who studies the eye in this way simply cannot say that there is nothing of the soul in it. It is simply stupid and philistine to say that the eye has no element of the soul. People say that light penetrates through the pupil into the eye, passes through the lens into the vitreous humour, produces an image here on the retina, and then is transmitted into the brain. Modern science stops right there, or it might state further that the light in the brain is used to produce thoughts. This description gives rise to all sorts of nonsensical statements that lead to nothing.

In reality, the light does not reach the brain. I have explained how it is reflected in the eyeball as in a mirror. The light remains in the eye, and it is important to know that it stays there. The interior of the eyeball is like the illuminated starry expanse. The light remains within the eye and does not penetrate directly into the brain. If the light did enter the brain, we would not be able to see anything at all. We can see because it does not do so. Just imagine, gentlemen, that you are standing here in this room all by yourselves; there are no chairs, nothing but the walls. The room is completely illuminated within, but you see nothing. You know only that it is illuminated, but you can see no objects of any kind. If the brain were only filled with light, we would see nothing because it is not solely on account of light that we see. Everywhere the light is kept in the eye and illumines its interior. What does this mean? Well, imagine that we have a little box. I stand with my back to it; I have not seen it before. I must reach behind myself to be able to know that it is there. Likewise, when the eye is illuminated from within, I must first feel the light to know that it is there. I must first feel the light, and this is done with the soul. In other words, the apparatus of the eye produces something we can feel. The soul passes through the muscles and feels or senses the little man I have mentioned within the eye.

Every organ within the human being shows us that here we must say that the soul observes, feels or senses what is within. If we examine everything carefully, we discover the soul and the spirit everywhere, especially in the eye. After a while, we can get the feeling that we are sitting in front of a peephole here (referring to his eye). When I look at you, you appear within, but I form the conception that the image within is the person outside. This is how the eye works. Just imagine that it is a little peephole through which the soul forms the idea that what it observes is the vast world. We simply must recognize the soul's existence when we actually examine the matter.

Now, I said that here is the choroid (referring to his sketch of the eyeball). It contains tiny blood vessels and lies under the optic nerve and its network. The optic nerve does not reach all the way to the front of the eyeball but the choroid, with its muscles, does. It extends to the lens and actually holds it in place. Here, as I have mentioned, is the iris surrounding the black pupil, which is nothing but an aperture. The iris is quite complicated. I will draw it a little larger, as seen from the side. So here is the iris, attached to the ciliary muscle. The choroid and lens sit within, held in place by the iris. Seen from the front, the iris has a front wall and a back wall. On the back wall are little coloured granules, which are microscopically small sacks. In everyone they are filled with a blue substance, and this is what one sees in blue-eyed people. In their case, the front layer is transparent, so you see the back layer of the iris, which is filled with this blue substance. In a blue-eyed person you are really seeing the back wall of the iris; the front part is transparent. Brown-eyed people have the same blue substance in the back layer of their iris, but they possess also brown granules in front of it. These cover up the blue ones so that all you see are the brown. A black-eyed person has black granules. You see not the blue but the little black sacks. It is the iris that causes a person's eyes to be blue, brown or black. The iris is always blue in back, and in blue-eyed persons it possesses no coloured substance at all in front; in brown-eyed and black-eyed people, it contains coloured granules in front that obscure the blue granules in back. Why is that? Well, you see, these tiny little sacks are constantly being filled with blood and then emptied. The blood penetrates the tiny granules in minute amounts. In a blue-eyed person, they are constantly being filled with and emptied of a little blood. The same thing happens with brown- and black-eyed persons. The blood enters, deposits blue or black coloured substance, then leaves again and takes the coloured substance with it. This is a continual process.

Now, some people have a strong force in their blood that drives the substances from food all the way into the eyes. This gives them brown or black granules. Those with black granules are people whose organisms can drive the blood most strongly into the eyes; the substances from nourishment easily reach into the eyes. This is less the case with brown-eyed people. Their eyes are not so well-nourished, and a blue-eyed person's organism does not drive the nourishing substances far enough into the eyes to fill the front part of the iris with them. It remains transparent and all we can see is the back part. Thus, a person is blue-eyed because of the way all the substances circulate through his organism. If you observe such a blue-eyed person, you can say that he has less driving force in his circulation than one who is black-eyed.

Consider the Scandinavians. Much of the nourishment must be utilized in fighting off the surrounding cold. A Nordic man does not have enough energy left to drive the nourishment all the way into the eyes; his energy is needed to ward off the cold. Hence, he is blue-eyed. A man who is born in a warm, tropical climate has in his blood the driving force to push the nourishing substances into his eyes. In the temperate zones it is an individual matter whether a man possesses more or less inner energy.

This also affects the colour of hair. A person with strong forces drives food substances all the way into his hair, making it brown or black. A person with less driving force does not push these substances all the way into the hair, and thus it remains light. So we see that blue eyes and blond hair are related. The one who drives the food substances forcefully through his body gets dark hair and eyes; the one who does it less vigorously gets light hair and eyes. This can be understood from what I have told you.

When you take into consideration the most important aspects, you can find meaning for everything. The earth on which we live was young when it brought forth those giant megatheria and ichthyosauria that I have described for you. The earth was once young. Now it is past its prime; it is growing older and some day will perish from old age, though not in the way described by the materialists. We are already faced with some of the signs of the earth's old age. Therefore, the entire human race has been weakened in regard to the driving force that moves the food substances through the body. So what part of the population is going to be the first to disappear from the earth? Dark people can last longer, for they possess greater driving force; blonds have less and become extinct sooner. The earth is indeed already into its old age. The gentleman who asked the question pointed out that there are fewer blonds around than in his youth. Because the earth has less vitality, only the black and brown peoples attain sufficient driving force; blonds and blue-eyed people are already marked for extinction because they can no longer drive nourishment with the necessary force through their bodies.

We can say that fair people were actually always weaker physically and that they were only mentally stronger. In former times many people were blond, but they were strong in spirit and knew much of what many today can no longer know. This is why I called your attention to how much people knew in olden days. Look at ancient India, five thousand years before the birth of Christ. The original inhabitants were black; they were quite dark. Then people with blond hair migrated from the north to the south. The Brahmans descended from those who were especially revered, the fair Brahmans. In time, however, blondness will disappear because the human race is becoming weaker. In the end, only brown- and black-haired people will be able to survive if nothing is done to keep them from being bound to matter. The stronger the body's forces, the weaker the soul's. When fair people become extinct, the human race will face the danger of becoming dense if a spiritual science like anthroposophy is not accepted. Anthroposophy does not have to take the body into consideration but can bring forth intelligence from spiritual investigation itself.

You see, when we really study science and history, we must conclude that if people become increasingly strong, they will also become increasingly stupid. If the blonds and blue-eyed people die out, the human race will become increasingly dense if men do not arrive at a form of intelligence that is independent of blondness. Blond hair actually bestows intelligence. In the case of fair people, less nourishment is driven into the eyes and hair; it remains instead in the brain and endows it with intelligence. Brown- and dark-haired people drive the substances into their eyes and hair that the fair people retain in their brains. They then become materialistic and observe only what can immediately be seen. Spiritual science must compensate for this; we must have a spiritual science to the same degree that humanity loses its intelligence along with its fair people. We have not built the Goetheanum as a joke, for no reason at all; we have built it because we anticipated what would happen to the human race if there were not spiritual compensation for what will disappear from the natural world. The matter is so serious that we can say that mankind on this earth must once again attain something fruitful, though in a different form from what was produced in ancient times. It is indeed true that the more the fair individuals die out the more will the instinctive wisdom of humans vanish. Human beings are becoming denser, and they can regain a new wisdom only if they do not have to depend on their bodies, but possess, instead, a true spiritual science. It is really so, and if people today want to laugh about it, let them. But then they have always laughed about things that have brought about some great change.

In the age when those giant beasts existed that I have described—the ichthyosauria, plesiosauria and megatheria—cows certainly did not yet exist, cows from whom milk is taken for human consumption. Of course, neither did human beings exist then who would have required such milk. But just yesterday I read a statement by somebody who is really afraid of progress. He thinks people who express ideas today that should be formulated only after many centuries have passed ought to be persecuted, because the time is not ripe for their utterances. Gentlemen, it seems to me that if this had been the case in the period when cows were supposed to come into existence, no creature would have had the courage to become a cow! It is like saying, “What is taught today as anthroposophy should emerge only after many centuries.” Well, then it wouldn't appear at all, just as no cows would have come into being. In effect, it is like saying, “I would rather remain an old primeval hog than transform myself into a cow!”

The situation on earth is such that we must have the courage to change and to ascend from those periods when mankind knew things instinctively, to one in which everything is known consciously. This is why I present everything to you here in such a way that you can comprehend fully what is really going on and know in what direction the wind is blowing. When you read a book nowadays, or when you hear about what goes on in the great wide world, you cannot actually get to the bottom of what makes everything tick. But people don't know that. You can understand a phenomenon like the gradual extinction of blonds if you comprehend how nourishing substances penetrate into both the eyes and hair, the colouring of which is closely related.

If you go to Milan, you will find that the head of the lion there is depicted in such a way that its mane, that is, the largest accumulation of hair the lion possesses, looks like rays of light. This rendering is based on an ancient wisdom in which it was known that both the eyes and hair are related to light and its rays.

Hair is indeed like plants, which are placed in the ground and whose growth is subject to light. If light is unable to draw the nourishing substances all the way into the hair, it remains blond. If a person is more closely tied to matter, the food substances penetrate the hair completely and counteract the light; then he gets black hair. Sages of old were still aware of this, just as were men even a few centuries ago. Thus, they did not depict the lion's mane as being curly but instead they gave it a radiating, straight form, as if the sun had placed its beams right into the lion's head. It is most interesting to observe such things.

As you recall, gentlemen, last time we talked about the eye, and we were particularly impressed with its marvellous configuration. Even in regard to its external form, the eye reproduces a whole world. When we become acquainted with the interior of the eye, the way we did the last time, we discover that there is indeed a miniature world within. That I have explained to you, and thus we have become familiar with two senses of man, sight and hearing.

Now, in connection with other questions you have recently posed, we shall see that a particularly fascinating and interesting human sense is that of smell. This sense appears to be of minor importance in man but, as you know, it is of great significance in the dog. You could say that all the intelligence of the dog is, in fact, transferred to the sense of smell. You need only consider how much the animal can accomplish by smell. A dog recognizes people by smell long after it has been with them. Anyone who observes dogs knows that they recognize and identify somebody with whom they have been acquainted, not by the sense of sight, but by that of smell. If you have heard recently how dogs can become excellent detectives and search for lawbreakers or for people in general, you will say to yourselves that here the sense of smell accomplishes rare things that naturally appear simple but are in actuality not so simple at all. You need only consider these matters to realize that they are not so simple.

“Well,” you may say casually, “the dog merely follows the scent.” Yes, gentlemen, that is true, the dog does indeed follow the scent. But think about it. Police dogs are used to follow, say, first the track of thief X and then the track of thief Y, one right after the other. The two scents are completely different from each other; if they were alike the dog could naturally never be able to follow them. Imagine now that you had to point out the difference between these tracks that the dogs distinguish by smell; you would discover no significant difference. The dog, however, does detect differences. The point is not that the dog follows the tracks back and forth in general but that it is capable of distinguishing between the various traces of scent. That, indeed, indicates intelligence.

There is yet another extremely important consideration. Civilized men use their sense of smell for foods and other external things, but it doesn't inform them of much else. In contrast, primitive tribes in Africa can smell out their enemies at far range, just as a dog can detect a scent. They are warned of their foes by smell. Thus, the intelligence that is found in such great measure in the dog is also found to a certain degree among primitive people. The member of a primitive tribe in Africa can tell long before he has seen his adversary that he is approaching; he distinguishes him from other people with his nose. Imagine how delicate one's sense of discernment in the nose must be if by that one can know that an enemy is nearby. Also, Africans know how to utter a certain warning sound that Europeans cannot make at all. It is a clicking sound, somewhat like the cracking of a whip.

It can be said that the more civilized a man becomes, the more diminished is the importance of his sense of smell. We can use this sense to ascertain whether we are dealing with a less developed species like the canine family—and they are a lower species—or one more developed. If we were to follow up on this, we would probably make some priceless discoveries about hogs, which, of course, have an exceptionally strong sense of smell.

There is something else in regard to this that will interest you. The elephant is reputed to be one of the most intelligent animals, and it certainly is; the elephant is a highly intelligent animal. Well, what feature is particularly well-developed in the elephant? Look at the area above the teeth in the dog and the pig, the area that in man forms itself into the nose. When you picture an especially strong and pronounced development of this part, you arrive at the elephant's trunk. The elephant possesses what is nose in us to a particularly pronounced degree, and therefore it is the most intelligent animal. The extreme intelligence of the elephant does not depend on the size of the brain but on its extension straight into the nose.

All these facts challenge us to ask how matters stand in respect to the human nose, an organ that civilized man today does not really know too much about. Of course, he is familiar with its anatomy and structure, but basically, he does not know much more than the fact that it sits in the middle of his face. Yet, the nose, with its continuation into the brain, is actually a most interesting organ. If you will recall my descriptions of the ear and the eye, you will say to yourselves that they are complicated. The nose, however, is not so complicated, but it is quite ingenious.

Seen from the front, the nose has a wall in the middle, the septum. This can be felt when you hold your nose. The septum divides the nose into a left and a right side, and to the left and the right are the actual parts of this organ. From the front it looks like this (sketching). The cribriform plate is located in the skull bone up where the nose sits between the eyes. It is like a little sieve. In other words, it is a bone with many holes. It is intricate but in my drawing I shall simplify it. On the exterior, the nose has skin like the skin on the rest of the body; inside, it is completely lined and filled out with a mucous membrane. This is everywhere in the nose, a fact that you can readily confirm. This membrane secretes mucus; if you did not have it, you would not have to blow your nose. So, inside the nose is a membrane that secretes mucus, but the matter is more complicated. You will have noticed that children who cry secrete a lot of nasal mucus. A canal in the upper part of the nose leads to the tear glands, which are located on both sides in the interior. There the secretion, the tears, enters the nose and mixes with the nasal mucus. Thus, the nose has a kind of “fluidic connection” with the eyes. The secretion of the eyes flows into the mucous membrane and combines with the secretion of the nose. This connection shows us again that no organ in the body is isolated. The eyes are not only for seeing; they can also cry, and what they then discharge mixes with what is primarily secreted in the membrane of the nose.

The olfactory nerve, the actual nerve used for smelling, passes through the cribriform plate, which is located at the roof of the nose. This nerve has two fibres that pass from the brain through the sieve-like bone and spread out within the nose. The mucous membrane, which we can touch with our finger, is interlaced by the olfactory nerve, which reaches into the brain. We can easily discern that because the nose is constructed quite simply.

Now we come to something that can reveal much to one who thinks sensibly. You see, a thorough examination will show that no one has eyes of equally strong vision, and when we examine the two hands we readily discover that they are not of equal strength. The organs of the human being are never completely equal in strength on both the left and right side. So it is also with the nose. Generally, we simply do not smell as well with the left nostril as with the right, but it is the same here as it is with the hand; some individuals are better at smelling with the left nostril than with the right, just as some people are left-handed. As you know, some people in the world are screwed together the wrong way. I am not referring to those people whose heads are screwed on wrong [(A play on words. In German, a “Querkopf' is a person who is odd. Rudolf Steiner then uses the term “Querherz” to indicate the anatomical oddity of the heart.)] but to those whose hearts are screwed on the wrong way. In the average person, the heart is located slightly off-centre to the left, as are the rest of the internal organs. Now, in a person whose heart is screwed on the wrong way, as it were, whose heart is off-centre a bit to the right, the stomach is also pushed over slightly to the right. Such a person is all “screwed up,” but this phenomenon is indeed less noticeable than when one is screwed up in the head. The fact becomes apparent when a person has fallen ill or has been dissected. Autopsies first led to the discovery that there are such odd people whose hearts and stomachs are shifted to the right. Of course, since not everyone who is queer in the head is dissected after death, one often doesn't even know that there are many more such “odd people” than is normally assumed whose hearts are off-centre to the right.

A truly effective pedagogy must take this into consideration. When dealing with a child who does not have its heart in the right place, speaking strictly anatomically, this must be taken into account; otherwise, it can have awkward consequences for the youngster. Because man is not just a physical apparatus, he does not necessarily have to be educated in such a way that abnormalities like this have to become an obstacle. Taking such aspects into consideration is what truly makes pedagogy an art.

A Professor Benedikt has examined the brains of many criminals. In Austria this was frowned upon because the people there are Catholics and they see to it that such things are not done. Benedikt was a professor in Vienna. He got in touch with officials in Hungary, where at one time there were more Calvinists, and he was given permission to transport the heads of executed criminals to Vienna. Several things then happened to him. There was a really ruthless killer who had I don't know how many murders on his conscience and who also had religious faith. He was a devout Catholic. When a rumour broke out that the brains of criminals were being sent to Professor Benedikt in Vienna, this criminal who was a cold-blooded murderer protested. He did not want his head sent to the professor because he didn't know where he would look for it to piece it together with the rest of his body when the dead arise on Judgment Day. Even though he was a hardened criminal, he did believe in Judgment Day.

So what did Professor Benedikt find in the brains of criminals? In the back of our heads we have a “little brain,” the cerebellum, which I shall speak about later on. It is covered by a lobe of the “large brain,” the cerebrum. It looks like a small tree (drawing). On top it is covered by the cerebrum and the occipital lobe. Now, Professor Benedikt discovered that in people who have never committed murder or a theft—and there are such people—the occipital lobe extends down to here (drawing), whereas in those who had been murderers or other criminals the lobe did not extend so far; it did not cover the cerebellum below.

A malformation like that is naturally congenital; a person is born with it. And, gentlemen, there are a great many people born with an occipital lobe that is too small to properly cover the cerebellum! It can be made up for by education, however. Nobody has to become a killer because he has a shorter occipital lobe; he becomes a criminal only if he is not properly educated. From this you can see that if the body is not correctly developed one can compensate for it with the forces of the soul. Therefore, it is nonsense to say that a person cannot help becoming a criminal—which is what the otherwise brilliant professor stated—because as an embryo he was incorrectly positioned in the mother's womb and thus did not properly develop the occipital lobe. He might be quite well-educated by accepted standards, but he is not properly educated in regard to such an abnormality. Of course, he cannot help the inadequacies of education, but society can help it; society must see to it that the matter is handled correctly in education. I mention this so you may realize the great significance of the whole organization of man.

Let us return again to the subject of the dog. We must admit that in the dog the nose is especially well-developed. Now, gentlemen, what do we actually smell? What does a dog really smell? If you take a bit of substance like this piece of chalk, you will not smell it. You will be able to smell it only if the substance is set on fire, and the ingredients evaporate to be received into the nose as vapor. You cannot even smell liquid substances unless they first evaporate. We smell only what has first evaporated. Also, there must be air around us with which the vapours from substances can mix. Only when substances have become vaporous can we smell them; we cannot smell anything else. Of course, we do smell an apple or a lily, but it is nonsense to say that we smell the solid lily. We smell the fragrance arising from the lily. When the vapor-like scent of the lily wafts in our direction, then the nerve in the nose is able to experience it.

What a primitive tribesman smells of his enemy are his evaporations. You can conclude from this that a man's presence makes itself felt much farther than his hands can reach. If we were primitive people and one of us were down in Arlesheim, he would know if an adversary of his were up here among us. This would mean that his foe would have to make his being felt all the way down to Arlesheim! (Arlesheim is about 154 miles from Dornach.) Indeed, all of you extend to Arlesheim by virtue of what you evaporate. On account of a man's perspirations, something of himself extends a good distance around himself, and through that he is present to a greater degree than through what one can see externally.

Now, the dog does something interesting that man cannot do. All of you are quite familiar with it. If somewhere you meet a dog you know well and that is equally well-acquainted with you, the animal will wag its tail because it is glad to see you. Yes, gentlemen, why does it wag its tail? Because it experiences joy? A man cannot wag his tail when he is happy, because he does not have one anymore. In this regard man has become stunted, insofar as he has no way to immediately lend expression to his joy. The dog, however, smells the person and wags its tail. On account of the scent, the dog's whole body reaches a state of excitement that is expressed by the tail muscles receiving the experience of gladness. In this respect man has reached the stage where he lacks such an organ with which he could express his joy in this way.

We see that while man is more cultivated than dogs, he lacks the ability to drive the sensation of smell down his spinal cord. The dog can do this; the scent enters its nose and is transmitted down the spinal cord, and then the dog wags its tail. What enters its nose as scent travels down the spinal cord. The end of the spine is the tail, and so it wags it. Man cannot do that and I shall tell you why he cannot. Man also possesses a spinal cord, but he cannot transmit a scent through it. Now, I shall draw the whole head of the human being in profile (diagram). The spinal cord continues down on the left. In the case of the dog it becomes the tail, which the animal can wag. Man, however, turns the force of his spinal cord in the other direction. Indeed, he has the capacity to change many things around, something that the animals cannot do. Thus, animals walk on all fours, or if they do not, as in the case of some monkeys, it is all the worse for them. They are actually organized to walk on all fours. But the human being raises himself up. At first man too walks on all fours, but then he stands erect. The force through which he accomplishes this and that passes through the spinal cord is the same force that pushes the whole brain forward. It is actually quite interesting to see a dog wag its tail. If a human being compared himself to the dog, he can exclaim, “Isn't that something; it can wag its tail, and I cannot!”

The whole force that is contained in this wagging tail, however, has been dammed back by man, and it has pushed the brain forward. In the dog it grows backward, not forward. The force that the dog possesses in its tail we turn around and lead into the brain. You can picture to yourselves how this really works by realizing that at the end of the spine, where we have the so-called tail bone, is the coccyx, which consists of several atrophied vertebrae. In the dog they are well-formed and developed; in us they are a fused and completely stunted protrusion that we can no longer wag. It ends here and is covered by skin. Now, we are able to turn this whole “wagging ability” around, and if in fact the top of the skull were not up here (b), upon smelling a pleasant odour we could wag with our brain, as it were. If our skull bones did not hold it together, we would actually wag with our brain toward the front when we are glad to see somebody.

You see, this is what marks the human organization; it reverses that function found in the animals. This tail wagging ability is still developed but it is reversed. In reality, we too wag something, and some people have a sensitivity for perceiving it. Isn't it true that court officials fawn and cringe in the royal presence? Of course, theirs is not a wagging like that of a dog, but some people still get the feeling that they are really wagging their tails. This is because their wagging is on the soul level and indeed looks like tail wagging. If one has acquired clairvoyance—something that is easily misunderstood but that merely consists of being able to see some things better than others—then, gentlemen, one does not just have the feeling that a courtier is wagging his tail in front of a personage of high rank; one actually sees it. He does not wag something in the back, but he does indeed wag something in the front. Of course, the solid substances within the brain are held together by the skull bones, but what is developed there in the form of delicate substantiality, as warmth, wags when a courtier is standing before royalty. It fluctuates. Now it is warm, now a little cooler, warmer, cooler. Someone with a delicate sensitivity for this fluctuating warmth, who is standing in the presence of courtiers surrounding the Lords, sees something that looks like a fool's cap wagging back and forth in front. It is correct to say that the etheric body, the more delicate organization of man, is wagging in front. It is absolutely true that the etheric body wags.

In the dog or the elephant all this is utilized to form the spinal cord. What remains stunted in both these animals is reversed and pushed forward in man. How is that? In the brain two things meet: The “wagging organ,” which has been pushed forward and is present only in man, and the olfactory nerve, which is also present in man. In the case of the dog, the olfactory nerve enlarges considerably because nothing counteracts it; what would restrain it is wagging in the back. The human being turns this around. The whole “wagging force” comes forward to the nose, and thus the olfactory nerve is made as small as possible; as it penetrates into the brain it is compressed from all sides by what comes to meet it there. You see, man has within the head an organ that, on the one hand, forces back his faculty of smell but, on the other, makes him into a human being. This organ results from the forces that are pushed up and forward.

In the case of the dog and the elephant, much of the olfactory nerve is located in the forward part of the brain; a large olfactory nerve is present there. In man, this nerve is somewhat stunted. The nerves that were pushed upward from below spread out instead. As a result, in this spot where in the dog sensations of smell spread out much further, in the human being the noblest part of the brain is located. There, located in the forward part of the brain, is the sense for compassion, the sense for understanding other human beings, and that is something noble. What the dog expends in its tail wagging, man transforms into something noble. There, in the forward part of the brain, just at the spot where the lowly nose would otherwise transmit its olfactory nerve, man possesses an extraordinarily noble organ.

I have mentioned that we do not smell equally well with the left and the right nostrils. Now, try to recall someone who is in the habit of making pronounced gestures. What does he do when he is pondering something? I am sure you have seen it. He reaches up with his finger or his hand and touches his nose; his index finger comes to rest directly over the septum, the inner wall dividing the nasal passages. For right here, behind the nose and within the brain, the capacity for discrimination has its physical expression.

The septum of the dog enables it not only to follow a lead exactingly but also to distinguish carefully with the left and the right nostrils how the scents appear to either one or the other. The dog always has in its right nostril the scent of what it is pursuing at the moment, while in the left it has the scents of everything it has already pursued. The dog therefore becomes increasingly skilful in pursuit, just as we men become more and more intelligent when we learn more and commit facts to our memory. The dog has a particularly good memory for scents, and that is why he becomes such a keen tracker.

A trace of that still exists in human life. Man's sense of smell has become dulled, but Mozart, for example, was sometimes inspired with his best melodies when he smelled a flower in a garden. When he pondered the reason for this, he realized that it happened because he had already smelled this flower somewhere else and that he had especially liked it. Mozart would never have gone so far as to say, “Well, I was once in this beautiful garden in such and such a place, and there was this flower with a wonderful fragrance that pleased me immensely; now, here is the fragrance again, and it makes me almost want to, well—wag my tail.” Mozart would not have said that, but a beautiful melody entered his mind when he smelled this flower the second time. You can tell from this how closely linked are the senses of smell and memory.

This is caused not by what we human beings absorb as scents but rather by what we push forward in the brain and against it. Our power of discrimination is developed there. If a person can think especially logically, if he has the proper thought relationships, then we can say that he has pushed his brain forward against his olfactory nerve, that he has actually adjusted the brain to what otherwise would have also been the olfactory nerve. We can say, too, that the more intelligent a man is, the more he has overcome the dog nature in himself. If a person were born with a dog-like capability to smell especially well, and he was educated to learn to distinguish things other than smells, he would become an unusually clever person because he would be able to discriminate among these other things by virtue of what he had pushed up against the olfactory nerve.

Cleverness, the power of discrimination, is basically the result of man's overcoming his sense of smell. The elephant and the dog have their intelligence in their noses; in other words, it is quite outside themselves. Man has this cleverness inside himself, and that is what distinguishes him. Hence it is not enough just to check and see whether the human being possesses the same organs as the animals. Certainly, both dog and man have a nose, but what matters is how each nose is organized. You can see from this that something is at work in man that is not active in the dog, and if you perceive this you gradually work yourself up from the physical level to the soul level. In the dog the nose and the bushy end of the spine, which is only covered by skin permeated with bony matter, have no inclination to grow toward each other. This tendency originates only from the soul, which the dog does not have in the way a man does. So, then, I have described the nose and everything that belongs to it in such a way that you see its continuation into the brain and find that man's intelligence is connected with this organ.

There is another sense that is quite similar to the sense of smell but in other respects totally different: the sense of taste. It is so closely related that the people in the region where I was born never say “smell”; the word is not used there at all. They say instead, “It tastes good,” or “It tastes bad,” when they smell something. Where I was born they do not talk of smelling but only of tasting. (Someone in the audience calls out, “Here, too, in Switzerland!”) Yes, also here in Switzerland you don't talk of smelling; smelling and tasting appear so closely related to people that they don't distinguish between the two.

If we now investigate the sense of taste, we will find that here there is something strange. Again, it is somewhat like it was with the sense of smell. So, if you take the cavity of the mouth, here in the back is the so-called soft palate, in the front is the hard palate, and there are the teeth with the gums. If you examine all this you will find something strange. Just as a nerve runs down into the nose, so here, too, nerves run from the brain down into the mouth. But these nerves do not penetrate into the gums, nor do they extend into the hard palate in front. They reach only into the soft palate in the back, and they go only into the back part of the tongue, not its front part. So if you see how the nerves are distributed that lead to the sense of taste, you will find only a few in front, practically none. The tip of the tongue is not really an organ of taste but rather one of touch. Only the back part of the tongue and the soft palate can taste. The mouth is soft in the back and hard in the front; only the soft parts are capable of tasting. The gums also have no sensation of taste.

The peculiar thing is that these nerves that convey the sense of taste in man are also connected primarily with everything that makes up the intestinal organization. It is indeed true that first and foremost a food must taste good, although its chemical composition is also important. In his taste man has a regulator for the intake of his food. We should study much more carefully what a small child likes or does not like rather than examine the chemical ingredients of its food. If the child always rejects a food, we shall find that something is amiss with its lower abdominal organs, and then one must intervene there.

I have already sketched the “tail wagging ability” that is reversed in man and that in the dog extends all the way into the back. If we now move forward from the tail, we reach the abdomen, the intestines, and to these the taste nerves correspond. It is like this: When a dog abandons itself to smelling, it wags its tail, which signifies that it drives everything through its entire body. The effects of what it smells pass all the way through to the end, to the very tip end of the tail. The tip of the nose is the farthest in front, and the tail is the farthest behind. What is connected with smelling in the dog passes through the entire length of its body, but what it tastes does not; it remains in the abdominal area and does not go as far. We can see from this that the farther something related with the nerves is located within the organism, the less far-reaching is its effect in the body. This will teach us to understand even better than we know already that the whole form of man depends on his nerves. Man is formed after his nerves. In the case of the dog, its tail is formed after the nose. What are its intestines formed after? They are formed after the nerves of the muzzle. The nerves are situated on one end, and they bring about the form on the other end. This is something that you must take as a basis for further consideration. You will gain much from realizing that the dog owes its whole tail wagging ability to its nose, and that when it feels good in the abdominal area, this is due to the nerves of the mouth. We shall learn more about this later.

It is extraordinarily interesting how the nerves are related to form. This is why I said the other day that even a blind person benefits from his eyes; even though the eyes are useless for sight, their nerves still help shape the body. The way a person appears is caused by the nerves of his head and in part by the nerves of his eyes, as well as by many other nerves. Therefore, if we want to understand why the human being differs in form from the dog, we have to think of the nose! The nose plays an important part in the shape of a dog, but in the human being it is overcome and somewhat subdued in its functions. In the dog, the nose occupies a higher rung on the ladder; it is the head-master, so to speak. In man, the function of the nose is forced back. The eye and the ear are certainly more important for his formation than is the nose.

Gentlemen, this time let us finish answering a question raised the other day.

By virtue of his skin, man is an entire sense organ. The skin of the human being is something extraordinarily complicated and truly marvellous. When we trace it from the outside inward, we find first a transparent and horny layer called the epidermis. It is transparent only in us white Europeans; in Africans, Indonesians and Malayans, it is saturated with coloured granules and thus tinged with colour. It is called “horny” because it consists of the same substance, arranged a little differently, from which the horns of animals and our nails and hair are fashioned. Our nails actually grow out of the uppermost layer of the skin. Under this layer lies the dermis, which consists of an upper and a lower layer. So we are in fact covered and enclothed with a three-layered skin: the outer epidermis, the middle layer of the dermis and the lower part of the dermis.

The lowest layer of the dermis nourishes the whole skin; it stores the nourishing substances for the skin. The middle layer is filled with all kinds of things, but in particular it is filled with muscle fibres. Everywhere in this layer are myriad tiny onion-like things, one next to the other; we have thousands upon thousands in our skin. We can call them “onions” because the distinguishing feature of an onion is its many peels, and these little corpuscles have such “onion peels”; the onion skin is on the surface, and the other, thinner part is on the inside. They were discovered by the Italian Pacini and are therefore called “Pacinian corpuscles.”

Around these microscopic corpuscles are from twenty to sixty such peels, so you can imagine how small they are.

Man is constituted in such a way that he has these microscopic little bulbs over the whole surface of his body. The largest number is found—in snakes as well as in men—on the tip of the tongue. Yes, it is almost comical, but most are found on the tip of the tongue! There are many on the tips of the fingers, on the palms of the hands and on other parts of the body, but most are on the tip of the tongue. For example, there are seven times more such little nerve bulbs on the tip of the tongue than there are on the finger tips.

A nerve fibre originates from each of these corpuscles and finds its way into the brain via the spinal marrow. All these nerve fibres radiate from the brain, and everywhere in the body they form such nerve bulbs on its surface. So these nerve fibres in the brain go everywhere and eventually form the onions within the skin or dermis. It is interesting to realize that just as real onions grow in the ground and form onion blossoms above, so do these onions grow in the human body. There (pointing to his sketch) are the onions and the stem within. In those nerves of the tongue the stem is rather short, but in other nerves it is sometimes quite long. The nerve fibres going from the feet into the brain through the spinal marrow are extremely long. Everything that we have as onions in our skin actually has blossoms within our skull. You may imagine, then, that in regard to his skin man is a kind of soil; it is strangely formed, but it still is a kind of soil. On the surface is the epidermis, in which various crystal substances are deposited. Below are the solid masses of the body, and above is the layer of “humus.” Going from outside inward, beneath the hard, horny layer of the epidermis lies the dermis, which is the soil. From it grow all these onions that have blossoms in the brain. Their stems pass up into the brain and have blossoms there.

Well, gentlemen, in us older fellows things are such that only during sleep can we properly trace this network, but in a child it is still much in evidence. The child has a lively nerve bulb activity in the nerves as long as its intellect is unawakened; that is, throughout its first year, and just as the sun shines over the blossoms of the onions, so shines the light into the child that as yet does not translate with the intellect what it receives with its eyesight. This is indeed like the sun shedding its rays inside the head and opening up all the onion blossoms. In the nerves of the skin we carry a whole plant kingdom around within us. Later, however, when we enter grammar school this lively growing comes to an end, and then we use the forces from the nerves for thinking. We draw these forces out and use them for thinking. This is extremely interesting. Ordinarily, it is assumed that the nerves do the thinking, but the nerves do not think. We can employ the nerves for thinking only by stealing their light, so to speak. The human soul steals the light from the nerves, and it uses what it has taken away for thinking. It is really so. When we truly ponder the matter, we finally recognize at every point the independently active soul.

We have such inwardly growing onions in common with all animals. Even the lowest forms, which have slimy, primitive shapes, possess sensory nerves that end in a kind of onion on the surface. The higher we ascend toward man, the more are certain of these nerve onions transformed in a specific manner. The nerves of the taste buds, for example, are such transformed skin nerves.

Now, we possess these sensory bulbs at the tip of the tongue and that is why it is so sensitive. We taste on the back of the tongue and on the soft palate where such little onions are dispersed. Actually, they sit there in a little groove and within these grooves an onion penetrates into the nerves and pushes into the dermis as a nerve corpuscle. First, a tiny groove forms behind the tongue, and then an onion pushes itself into this groove. The root of the onion penetrates all the way to the surface of the tongue. On the base of the tongue are a tremendous number of tiny grooves, and in each little groove a “bulb” grows up from below. This accounts for our experience of taste.

We can be aware of everything with the sense of touch, or these onions located on our body's surface. Now, you know that what one feels one does not remember so well. I know with my feeling that a chair is hard because I feel its hardness with a certain number of nerve bulbs that constantly change, but my memory is not strained by this sensation. With the sense of taste it makes a little, though unconscious effort. Gourmets, however, always know beforehand what is good, not afterward when they have already tasted it, and that is why they order it.

So the nerve corpuscles pass through the spinal marrow directly into the brain and form blossoms there. Everything that we want to taste, however, must first be dissolved by the saliva in the mouth; we can taste nothing that hasn't first been transformed into fluid. But what is it that tastes? We would not be able to taste anything if we did not have fluid within us. Our solid human constitution, everything that is solid in the body, does not taste. Our inner fluid mixes with what is dissolved of the food. Thus, we can say that our own fluid mixes with the fluid from without. The solid part of the human organization does not taste anything. Our constitution is ninety percent water, and here, around the papillae of the tongue, it is in an especially fluid state. Just as water shoots out of a geyser, so do we have such a spurting forth of fluid on the tip of the tongue.

Saliva that has been spit out of the mouth is no longer part of me, but as long as that fluid is within the little gland of the tongue, it belongs to me as a human being, just as my muscles belong to me. I consist not only of solid muscles but also of water, and it is this fluid that actually does the tasting because it mixes with what comes as fluid from without. What does one do when one licks sugar? One drives saliva from within toward the taste buds. The dissolved sugar penetrates the fluid, and the “fluid man,” as it were, permeates himself with the sugar. The sugar is secreted delicately in the taste buds of the tongue and spreads out in one's own fluidity, giving him a feeling of well-being.

As human beings we can only taste, but why is this so? If we had fins and were fishes—which would be an interesting existence—every time we ate, the taste would penetrate right through our fins. But then we would have to swim in water, where we would find everything even the delicate substances well-dissolved. The fish tastes all the traces of substances that are in the water and follows the direction of its taste, which is constantly penetrating into the fins. If something pleasant flows in its direction, the fish will taste it, and its fins will immediately move toward it. We men cannot do what the fish can because we have no fins; in us they are completely lacking. But since we cannot use the sensation of taste to move around, we intensify it within. Fishes have a highly developed sense of taste, but they have no inward sense of it. We human beings have the taste within, we experience it; fishes exist in the totality of the water and experience taste together with the surrounding water. People have wondered why a fish swims far out into the ocean when it wants to lay its eggs. They swim far out, not only into the Atlantic Ocean, but also into other parts of the earth's oceans, and then the young slowly return to European waters. Why is this? Well, European fishes that swim around in our rivers are fresh-water fishes, but the eggs cannot mature in fresh water. Fishes sense by taste that a trace of salt flows toward the outlet of a river; they then swim out into the sea. If the sun shines differently on the other side of the earth, they taste that and by this sense swim halfway around the globe. Then the young taste their way back again to where the parent fishes have dwelt. So we see that fishes follow their taste in every way.

It is extremely interesting that the water that flows in the rivers and is contained in the seas is full of taste, and the fact that fishes swim around in them is really due to the water's taste. It is actually the taste of the water that makes them swim around; the taste of the water gives them their directions. Naturally, if the sun shines on a certain portion of water, everything that is in the water at that spot is thoroughly dissolved by the heat of the sun. It is changed into another taste, and that is why you see a lot of fishes swimming around there; it is the taste.

It is really a strange matter, gentlemen, because we would actually be swimming, too, if we went only by our taste. When I taste sugar the fluid man within me wants to swim toward it. The urge to swim is indeed there; we want to swim constantly according to our taste, but the solid body prevents us from doing so. From that element that continually would like to swim but cannot—we really have something like a fish within us that constantly wants to swim but is held back—we retain what our inner soul being makes out concerning taste. With taste we live completely within the etheric body, but the etheric body is held fast by the water in us, and that water in turn is held by our physical body. It is the most natural thing to say that man has an etheric body that is really not disposed to walking on the earth. It is suited only for swimming; it is in fact fish-like, but because man makes it stand erect it becomes something different. Man has within him this etheric body that is actually only in his fluid organization, and it is indeed so that he would constantly like to swim, swim in the elements of water that are contained even in the air. We would like to be always swimming there, but we transform this urge into the inner experience of taste.

You see, such aspects really lead one to comprehend the human being. You cannot find this in any modern scientific book because people examine not the living human being but only the corpse, which no longer wants to swim. Nor does it participate any longer in life. We participate in life because actually we are the sum of everything existing in the world. We are fishes, and the water vapor that is similar to us is something in which we would like to be constantly swimming about. The fact that we cannot do so results in our pouring it into us and tasting it. The fishes are really cold creatures. They could taste things marvellously well that are dissolved in the water, but they do not do so because they immediately move their fins. If the fins would disappear from the fishes, they would become higher animals and would begin to have sensations of taste.

The nerve bulbs that I told you about last time are differently transformed “onions.” They penetrate into the mucous membrane of the nose, but they do not sit within a groove from which fluid seeps out; they reach all the way to the surface. That is why these nerve bulbs can perceive only what comes close to them. This means that we have to let the fragrance of the rose come up to the nerve bulb of our nose before we can smell it. Thus, one part of the human body has the function of fashioning in a special way these nerve bulbs, which are spread out over the whole skin, in order to sense smells permeating the air.

Not only does the outer air waft toward man, but also the breath streams out from within him. The breath constantly passes through the nose, and within this breath lives the air being of man. We are water, and as I told you earlier, we are also air. We do not have the air within us just for the fun of it. Like the water within me, my breath is not solid. Just as when I reach out my hand and feel that I have stretched out something solid, so I stretch what I contain in my air organism into my nose. There I grasp the fragrance of the rose or carnation. Indeed, I am not only a solid being but continually a being of water and air as well. We are the air as long as it is within us and is alive. When we stretch our “air hands” through the nose and grasp the fragrance of a rose or carnation—bad odors, too, of course—we do not touch it with our hand but rather grasp it with the nerve bulbs, which attract the breath from within so that it can take hold of the fragrance.

This is something that is manifest also in the dog. I have told you that as soon as the nose smells, the tail wags. Just as with fishes the fins start to move about, so, too, with dogs the tail starts to move. But what does this tail that can only wag really want to do? This is most interesting. The tail can only wag, but what does it really want to do? You see, gentlemen, the dog would really like to do something quite different. If it were not a dog but a bird it would fly under the influence of smell. Just as fishes swim, a dog would fly if it were a bird. Well, of course, a dog has no wings, and so he uses the substituted organ and just wags his tail. It isn't enough for flying, but it involves the same expenditure of energy. In human beings it is the same. Because we always have delicate sensations of smell that we do not even notice, we would constantly like to fly.

Think now of the swallows that live here in summer. What arises as scents from the flowers is pleasing to them, and because it is pleasing to their organ of smell they remain here. But when autumn comes or is just approaching, the swallows, if they could communicate among themselves, would say, “Oh, it's beginning to smell bad!” The swallow has an extraordinarily delicate sense of smell. You remember that I told you that people are perceptible to savage tribes all the way to Arlesheim. Well, for swallows the odour arising in the south is perceptible when fall is approaching; it actually spreads out all the way to the north. While in the south it smells good, up north it begins to smell of decay. The swallows are attracted to the good odour and fly south.

Whole libraries have been written about the flight of birds, but the truth is that even during the great migrations in spring and autumn the birds follow the extremely delicate dispersion of odours in the whole atmosphere of the earth. The organ of smell in the swallows guides them to the south and then back again to the north. When spring arrives here in our lands, it starts to smell bad for the swallows down south. When the delicate fragrances of spring flow southward to them, they fly back north. It is really true that the whole earth is one living being and that the other beings belong to it.

In our body, things are so organized that the blood flows to the head and then away from it. On the earth, things are so arranged that the migratory birds fly to the equator and then back to their point of departure. We, too, are influenced by the air because the air we breathe drives the blood to the head. Insofar as we are beings of air, we are completely permeated with smell. For example, a person who walks across a field that has just been fertilized with manure is really going there together with his airy being. The solid man and the fluid man do not notice the manure, but the man of air does, and then there arises in him, understandably enough, the urge to fly away. When the manure's stinking odour rises from the field, he would actually like to fly off into the air. He cannot do so because he lacks the wings and thus reacts inwardly to what he cannot fly away from; it becomes an internal process of the soul. As a result, man inwardly becomes permeated with the manure odour, with the evaporations that have become gaseous and vapor-like. He becomes suffused with the bad odour and says that he loathes it. His loathing is a reaction of the soul.

In the fluid man there exists the more delicate airy form that, in a way, he takes from the fluid organization of himself. It is through this that he can taste. Likewise, something lives in this airy form that we constantly renew in us through inhaling and exhaling. Each moment it is expelled and reborn; it is born eighteen times a minute and dies eighteen times a minute. It takes years for the solid form to die, but the airy form dies during exhalation eighteen times a minute and is born during inhalation. It is a continuous process of dying and being born. What is extracted within is the astral body. As I told you the other day, it is the astral body that reverses the forces of tail-wagging that should really be down below. Because these forces are pushed up and against the sense of smell, we are able to think. The brain grows to meet the nose under the influence of the astral body, and no one can really understand the brain who does not look at the whole matter in the way I have just done. This understanding results from a correct observation of our senses.

On account of our sense of smell we would always like to be flying. The bird can fly but we cannot; at best we have these solid shoulder blades. Why can the bird fly? Gentlemen, the bird has something peculiar that enables it to fly; it has hollow bones. Air is inside them and the air that the bird absorbs through its organ of smell comes into contact with the air that it has in its bones. Indeed, the bird is primarily a being of air. Its most important aspect consists of air; the rest is merely grown on to it. The many feathers a bird may have are actually all dried up. The most significant thing, even in the ostrich, is that a bit of air is still contained in each downy feather and all this air is connected with the air outside. The ostrich walks because it is too heavy to fly but, of course, the other birds do.

We human beings have only our shoulder blades attached to our back, which are clumsy and solidly shaped. Although we would constantly like to fly with them, we cannot. Instead, we push the whole spinal marrow into the brain and begin to think. Birds do not think. We have only to observe them properly to realize that everything goes into their flight. It looks clever, but it is really the result of what is in the air. Birds do not think, but we do because we cannot fly. Our thoughts are actually the transformed forces of flying. It is interesting that in human beings the sense of taste changes into forces of feeling. When I say, “I feel well,” I would really like to swim. Since I cannot, this impulse changes into an inner feeling of well-being. When I say, “The odour of the manure repulses me,” I would really like to fly away. But I cannot, and so I have the thought, “This is disgusting; this odour is repulsive!” All our thoughts are transformed smells. Man is such an accomplished thinker because he experiences in the brain, with that part I described earlier, everything that the dog experiences in the nose.

As human beings, we owe a lot to our nose. You see, people who have no sense of smell, whose mucous membrane is stunted, also lack a certain sense of creativity. They can think only through what they have inherited from their parents. It is always good that we inherit at least something; otherwise, if all our senses were not rudimentarily developed, we could not live at all. A person born blind also has inherited the interior of what the eye possesses. He has this primarily because he is not only a compact man but also a man of fluid and air.

We have now seen how strange all this is. We perceive solid substances with our sense of touch through the nerve bulbs that penetrate the skin everywhere; we become aware of watery substances with our sense of taste; what is of air, the vaporous, is recognized by us through the nerve bulbs that penetrate into the mucous membrane of the nose. We also sense something else around us, though in a more general way; that is, heat and cold. So, as human beings we are partly solid, water, air, and warmth, since we are usually warmer than the surrounding world.

You see, science does not really know that the aspect of tasting concerns the man of water and that the element of smell pertains to the man of air. Because the nerves of taste come into the taste buds, it is the scientific opinion that these nerves actually taste. But this is nonsense. In the mouth, it is the fluid of the watery organization of man that tastes, and in the nose, it is the element of air that smells. Furthermore, the part of us that is warmth perceives heat and cold. The internal warmth in us directly perceives the external warmth, and this is the difference between the sense of warmth and all the other senses. Warmth is produced by all the organs, and as human beings we harbour a world of warmth within us. This element of warmth perceives the other world of warmth around us. When we touch something that is hot or cold, we naturally perceive it just on the spot where we have touched it. But when it is cold in winter or hot in summer, we perceive this coldness or heat in our surroundings; we become a complete sense organ.

We can see how science errs in this regard. According to scientific books, the human being is some kind of compactly shaped form. All the bones are drawn on the paper; the muscles and nerves are all there. But this is utter nonsense because it represents no more than one tenth of the human being. The rest is up to ninety percent water, and then we must account for the air and the warmth within. In fact, three more persons—of water, air and warmth—should be sketched into the figures drawn up by materialistic science. Man cannot be comprehended in any other way. Only because we are warmer than our surroundings and are also a portion of a world of warmth do we experience ourselves as being independent in the world. If we were as cold as a fish or a turtle, we would have no ego; we could not speak of ourselves as “I.” We could never think if we had not transformed the sense of smell within us, or, in other words, if we had no astral body. Likewise, we would have no ego if we did not possess a portion of warmth within us.

Now, someone might say that the higher animals have their own body temperature, too. Yes, gentlemen, but they are burdened by their warmth. The higher animals would like to become an “I” but cannot. Just as we cannot swim or fly, the higher animals would like to become an “I” but cannot do it. You can discern that in their forms; they would really like to become an “I,” and because they cannot they assume their various shapes.

So, as human beings we have four parts in us: the solid man, which is the physical, material part; the fluid man, which carries the more delicate body—the life body or etheric body—within itself; the air being, the man of air who constantly dies and is renewed in the physical realm but who contains the astral body, which remains throughout life; the portion of warmth, the ego man.

The sense of warmth is distributed delicately over the whole human being. Here science does something peculiar.

When we examine the human being from a purely materialistic standpoint, we discover these nerve bulbs that I have described to you. Now, people say to themselves, “If I touch this box, I feel it and its solidness because of the nerve bulbs. If the box were cold, I would also feel the cold through such a nerve bulb.” They constantly look for these nerve bulbs of warmth and these nerve bulbs of feeling, but they never find them. Someone will examine a piece of skin, and because some of these nerve bulbs for feeling look a little different he thinks that they belong to something else. But it is all nonsense. There are no nerve bulbs sensitive to warmth because the whole human being is perceptive to warmth. These nerve bulbs are used only for sensing solid, water and vaporous substances. Where the sense of warmth begins, we become extremely “light-sensed” beings, that is, no more than a bit of warmth that perceives exterior heat. When we are surrounded by an amount of heat that enables us properly to say “I” to ourselves, we feel well, but when we are surrounded by freezing cold that takes away from us the amount of warmth that we are, we are in danger of losing our ego. The fear in our ego makes the cold outside perceptible to us. When somebody is freezing he is actually always afraid for his ego, and with good reason, because he pushes the ego out of himself faster than he actually should.

These are the aspects that will gradually lead us from the observation of the physical to the observation of the nonphysical, the non-material. Only in this way can we begin to comprehend man. Having mentioned all this, we shall be able to continue with quite interesting observations next time.