wo fundamentally
important requirements in the working of all economic units._

The former is the best guarantee of the continuous functioning of the
unit. The latter links together the different units, making them working
parts of the whole economic system.

Here are four indispensable requirements--the maintenance of human
values, the preservation of group integrity and permanence, productive
efficiency and self-generated activity--for the building and successful
continuance of economically sound unit groups. If society is to secure
maximum returns, if the economic mechanism is to yield its largest quota
of goods and services to mankind, the units out of which society is
built must meet these requirements which constitute four of the
essential pre-requisites to the success of any economic experiment.

3. _Centralized Authority_

Granted the desirability of efficiency in economic organization, the
question at once arises as to how this efficiency is to be guaranteed.
Up to this point the means adopted to secure such an end have consisted
in concentrating economic authority in the hands of a small owning and
managing class, and in leaving with the members of this class the
determination of policy and of methods of procedure.

The concentration of administrative authority at one point has proved
impracticable, first because of the great amount of red tape involved in
the handling of the endless detail, and second because of the resulting
destruction of initiative and enterprise. Such a centralization of
social function would be just as cumbersome as a like centralization of
all bodily functions in the higher brain centres. If men were compelled
to reason about and to direct each step, each movement of eyes or hands,
each breath, each heart-beat, the attention would never pass beyond the
boundaries of such pressing and never-ending routine. Many bodily
organs, like the stomach, function involuntarily. Walking becomes
habitual. It is only when the stomach and the legs fail to work properly
that they become the objects of attention. The same thing should be true
of a well-directed economic system. Each local unit should function
locally and autonomously, and the problems of local function should
never come to the attention of a more central authority until there is
some failure to work on the part of the local unit.

Those who despair of the future of society, and who feel that effective
co-operation between s