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To complete the present discussion, however, it is enough to notice that intelligence and will must be found in every creature, and that thus we account for the "appetition" and the "perception" that characterize even the lowest monad. The scale of monads, however, would not be as complete as possible unless there were beings in whom appetition became volition, and perception, self-conscious intelligence. Such monads will stand in quite other relation to God than the blind impulse-governed substances. "Spirits," says Leibniz, "are capable of entering into community with God, and God is related to them not only as an inventor to his machine (as he is to other creatures) but as a prince to his subjects, or, better, as a father to his children. This society of spirits constitutes the city of God,—the most perfect state under the most perfect monarch. This city of God, this truly cosmopolitan monarchy, is a moral world within the natural. Among all the works of God it is the most sublime and divine. In it consists the true glory of God, for there would be no glory of God unless his greatness and goodness were known and admired by spirits; and in his relation to this society, God for the first time reveals his goodness, while he manifests everywhere his power and wisdom. And as previously we demonstrated a perfect harmony between the two realms of nature,—those of efficient and final causes,—so must we here declare harmony between the physical realm of nature and the moral realm of grace,—that is, between God as the architect of the mechanical world-structure, and God as the monarch of the world of spirits." God fulfils his creation, in other words, in a realm of spirits, and fulfils it because here there are beings who do not merely reflect him but who enter into relations of companionship with him, forming a community. This community of spirits with one another and with God is the moral world, and we are thus brought again to the ethics of Leibniz.

It has been frequently pointed out that Leibniz was the first to give ethics the form which it has since kept in German philosophy,—the division into Natur-recht and Natur-moral. These terms are difficult to give in English, but the latter corresponds to what is ordinarily called "moral philosophy," while the former is political philosophy so far as that has an ethical bearing. Or the latter may be said to treat of the moral ideal and of the moral motive and of duty in themselves, while the former deals with the social, the public, and in a certain sense the external, aspects of morality.

Puffendorf undoubtedly suggested this division to Leibniz by his classification of duties as external and internal,—the first comprehending natural and civil law, the second moral theology. But Puffendorf confined the former to purely external acts, excluding motives and intentions, and the latter to divine revelation. Both are "positive," and in some sort arbitrary,—one resting merely on the fact that certain institutions obtain, the other on the fact that God has made certain declarations. To Leibniz, on the other hand, the will of God is in no sense the source of moral truths. The will of God does not create truth, but carries into effect the eternal truths of the divine understanding. Moral truths are like those of mathematics. And again, there is no such thing as purely external morality: it always contains an inner content, of which the external act is only the manifestation. Leibniz may thus be said to have made two discoveries, or rather re-discoveries: one, that there is a science of morals, independent of law, custom, and positive right; the other, that the basis of both "natural" and "positive" morals is not the mere will of God, but is reason with its content of eternal truths.

In morals the end is happiness, the means wisdom. Happiness is defined, not as an occurrence, but as a condition, or state of being. "It is the condition of permanent joy. This does not mean that the joy is actually felt every moment, but that one is in the condition to enjoy whenever he thinks of it, and that, in the interval, joyfulness arises from his activity and being." Pleasure, however, is not a state, but a feeling. It is the feeling of perfection, whether in ourselves or in anything else. It does not follow that we perceive intellectually either in what the perfection of the pleasant thing consists or in what way it develops perfection within us. It is enough that it be realized in feeling, so as to give us pleasure. Perfection is defined "as increase of being. As sickness is, as it were, a lowering and a falling off from health, so perfection is something which mounts above health. It manifests itself in power to act; for all substance consists in a certain power, and the greater the power the higher and freer the substance. But power increases in the degree that the many manifests itself from one and in one, while the one rules many from itself and transforms them into self. But unity in plurality is nothing else than harmony; and from this comes order or proportion, from which proceeds beauty, and beauty awakens love. Thus it becomes evident how happiness, pleasure, love, perfection, substance, power, freedom, harmony, proportion, and beauty are bound up in one another."

From this condensed sketch, taken from Leibniz himself, the main features of his ethical doctrine clearly appear. When we were studying freedom we saw that it was not so much a starting-point of the will as its goal and ideal. We saw also that true freedom is dependent upon knowledge, upon recognition of the eternal and universal. What we have here is a statement of that doctrine in terms of feeling and of will instead of knowledge. The end of man is stated to be happiness, but the notion of happiness is developed in such a way that it is seen to be equivalent to the Aristotelian notion of self-realization; "it is development of substance, and substance is activity." It is the union of one and the many; and the one, according to the invariable doctrine of Leibniz, is the spiritual element, and the many is the real content which gives meaning to this rational unity. Happiness thus means perfection, and perfection a completely universalized individual. The motive toward the moral life is elsewhere stated to be love; and love is defined as interest in perfection, and hence culminates in love of God, the only absolute perfection. It also has its source in God, as the origin of perfection; so that Leibniz says, Whoso loves God, loves all.

Natural right, as distinguished from morals, is based upon the notion of justice, this being the outward manifestation of wisdom, or knowledge,—appreciation of the relation of actions to happiness. The definitions given by Leibniz are as follows: Just and unjust are what are useful or harmful to the public,—that is, to the community of spirits. This community includes first God, then humanity, then the state. These are so subordinated that, in cases of collision of duty, God, the universe of relations, comes before the profit of humanity, and this before the state. At another time Leibniz defines justice as social virtue, and says that there are as many kinds of "right" as there are kinds of natural communities in which happiness is an end of action. A natural community is defined as one which rests upon desire and the power of satisfying it, and includes three varieties,—domestic, civil, and ecclesiastic. "Right" is defined as that which sustains and develops any natural community. It is, in other words, the will for happiness united with insight into what makes happiness.