E.F. Schumacher and the Metaphysical Reconstruction of Economics According to Catholic Social Teaching

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Discussion

Peter Critchley:

"E.F. Schumacher is an important figure whose significance has yet to be fully appreciated. People read his book Small is Beautiful, and respond to his message concerning an economics as if people mattered. Then they go straight to his practical solutions and work on appropriate technology. These are, of course, important but not, for Schumacher, the most important. Most important is what he called ‘metaphysical reconstruction’. Schumacher holds that the modern world’s abandonment of the ancient and the Christian conception of economics as a branch of ethics has impoverished our social and moral lives and left us blind worshippers of the new gods of money, capital, commodities – the false religion of economic growth. He thus calls for an appropriately scaled society in which material activities are organised according to purpose, organisation in accordance with metaeconomic values in which people come before profits. It’s there in what is called ‘distributism’, a theory of social organisation and economic provision that derives from social Catholicism and which profoundly influenced the proposals Schumacher advanced in his book Small is Beautiful. Distributism is very closely linked with the environmental and ecological questions of today.


‘What I’m struggling to do is to help recapture something our ancestors had. If we can just regain the consciousness the West had before the Cartesian Revolution, which I call the Second Fall of Man, then we’ll be getting somewhere.’


The practical men and women of the world, impatient to get things done, go straight to Schumacher’s words on solutions and technologies. Very important these things are too. But Schumacher himself considered the “metaeconomic” foundation of his case for the appropriately scaled society to be prior to the specifics of his economics.


How is it to be done? What are the moral choices?, Schumacher asks in the final chapter. He addresses technical and institutional issues and monetary costs and then points out the lesson: ‘But it is bound by truth. Only in the service of truth is perfect freedom, and even those who today ask us 'to free our imagination from bondage to the existing system' fail to point the way to the recognition of truth.’


And the truth points to a society organised around the Four Cardinal Virtues:


‘In the Christian tradition, as in all genuine traditions of mankind, the truth has been stated in religious terms, a language which has become well-nigh incomprehensible to the majority of modern men. The language can be revised, and there are contemporary writers who have done so, while leaving the truth inviolate. Out of the whole Christian tradition, there is perhaps no body of teaching which is more relevant and appropriate to the modern predicament than the marvellously subtle and realistic doctrines of the Four Cardinal Virtues - prudentia, justitia, fortitudo, and temperantia.’


These virtues are the hinge upon which all else depends. Together, with prudence at the heart – the ‘mother’ of all other virtues – the cardinal virtues constitute a healthy and just alternative to the ‘small, mean, calculating attitude to life, which refuses to see and value anything that fails to promise an immediate utilitarian advantage.’


Schumacher’s final passage in Small is Beautiful puts it concisely:


‘Only on the basis of this magnanimous kind of prudence can we achieve justice, fortitude and temperantia, which means knowing when enough is enough. 'Prudence implies a transformation of the knowledge of truth into decisions corresponding to reality.' What, therefore, could be of greater importance today than the study and cultivation of prudence, which would almost inevitably lead to a real understanding of the three other cardinal virtues, all of which are indispensable for the survival of civilisation?


Justice relates to truth, fortitude to goodness, and temperantia to beauty; while prudence, in a sense, comprises all three. The type of realism which behaves as if the good, the true, and the beautiful were too vague and subjective to be adopted as the highest aims of social or individual life, or were the automatic spin-off of the successful pursuit of wealth and power, has been aptly called 'crackpot-realism'. Everywhere people ask: 'What can I actually do?' The answer is as simple as it is disconcerting: we can, each of us, work to put our own inner house in order. The guidance we need for this work cannot be found in science or technology, the value of which utterly depends on the ends they serve; but it can still be found in the traditional wisdom of mankind.’ (Schumacher 12 Epilogue)


The four primary moral virtues are called the cardinal virtues: prudence, justice, fortitude, and temperance. The ‘cardinal virtues’ are well named. These virtues are cardinal because all other virtues are categorized under and ‘hinge’ - Latin cardo - upon them. These virtues form the building blocks of Schumacher’s economics of human scale and appropriate technology. They constitute the fabric of the just and functional order.


In talks given at the Davis Extension Conference, Schumacher emphasised that the first task before us is “to sort out our values and our views of reality, to clear our minds.” Unfortunately, the great temptation of ‘practical’ men and women in an age of action and industry has been to go straight to the concrete work of construction, and ignore the prime importance of metaphysical reconstruction, with the result that our technics continue to misfire. The problems we face are not mere technological problems; they are fundamentally moral problems that go to the heart of the way our social powers are organised and used. Time and again, actions sprint past questions of morality, purpose and meanings to the practical issues. Schumacher knew this was happening. He even wrote Guide for the Perplexed to make his point absolutely clear. To the end he insisted on the primacy of “metaphysical reconstruction.” This is the first task and the most important task since, without such reconstruction of our values, ‘the various technological fixes will only add to the confusion. But nowadays, to talk openly about such issues is hardly permitted in polite society.’


Such times we live in are beyond good manners, it’s time to ‘talk openly’ – get your values, visions and virtues in order, recover purpose and have an answer to the questions ‘why’ and ‘what’s the point.’ And then we will find the practical questions of life will be so much more easy to solve.


Schumacher’s views are consistent with Catholic social teachings, which should come as no surprise, because that is precisely where Schumacher got them from. Schumacher was a convert to Catholicism precisely because such views fitted his own thinking on social and moral questions. He belongs to a Thomist tradition that includes such figures as Jacques Maritain and Etienne Gilson. Catholic social thought stresses the principle of subsidiarity, which holds that power should reside at its lowest level of competence, scaling higher when necessary. Social and political institutions ought to be manageable in size, scaled to human proportions and dimensions, comprehensible, and run in accordance with purpose so as to enhance rather than inhibit the dignity of the people involved in them. This tradition emphasises the importance of the intermediary associations which between government and market, public and private realms, and which mediate the relations between the individual and the state, constituting a form of social and moral self-government in the associational space of civil society.


There are many who sing the praises of Schumacher’s Small is Beautiful who do not realise the background he drew upon for his ideas. Catholic distributists such as G. K. Chesterton, Hillaire Belloc and Eric Gill were arguing for the decentralisation of industry and economic democracy in similar terms to Small Is Beautiful many years before that book was published. On the continent, Christian Democratic parties have supported the idea of workers’ councils as part of management in corporations, the co-determination system in Germany, for instance. The very same proposal is also to be found in Schumacher’s book. And much more besides.


Catholic thinkers such as Jacques Maritain criticised the individualism of bourgeois capitalism but rejected a totalitarian, top-down state socialism as an alternative. He sought a middle way between social atomism and political centralisation as two sides of the same problem, and this middle way is integral to Catholic social thought."

(https://pcritchley2.wixsite.com/beingandplace/post/2015/05/08/the-economics-of-purpose-ef-schumacher-and-rh-tawney)


R.H. Tawney and the Acquisitive Society

Peter Critchley:

"This view can also be found in the work of Christian Socialist and economic historian R.H. Tawney, for whom industry is to be organized to express most perfectly the principle of purpose. As he writes in The Acquisitive Society:


‘A function may be defined as an activity which embodies and expresses the idea of social purpose. The essence of it is that the agent does not perform it merely for personal gain or to gratify himself, but recognizes that he is responsible for its discharge to some higher authority. The purpose of industry is obvious. It is to supply man with things which are necessary, useful, or beautiful, and thus to bring life to body or spirit. In so far as it is governed by this end, it is among the most important of human activities.’


‘When men have gone so far in imbecility as to talk as though their idols have come to life, it is time that some one broke them. Labour consists of persons, capital of things. The only use of things is to be applied to the service of persons. The business of persons is to see that they are there to use, and that no more than need be is paid for using them.’ (Tawney 1982 ch 7).


‘So the organization of society on the basis of functions, instead of on that of rights, implies three things. It means, first, that proprietary rights shall be maintained when they are accompanied by the performance of service and abolished when they are not. It means, second, that the producers shall stand in a direct relation to the community for whom production is carried on, so that their responsibility to it may be obvious and unmistakable, not lost, as at present, through their immediate subordination to shareholders whose interest is not service but gain. It means, in the third place, that the obligation for the maintenance of the service shall rest upon the professional, organizations of those who perform it, and that, subject to the, supervision and criticism of the consumer, those organizations shall exercise so much voice in the government of industry as may be needed to secure that the obligation is discharged.

It is obvious, indeed, that no change of system or machinery can avert those causes of social malaise which consist in the egotism, greed, or quarrelsomeness of human nature. What it can do is to create an environment in which those are not the qualities which are encouraged. It cannot secure that men live up to their principles. What it can do is to establish their social order upon principles to which, if they please, they can live up and not live down. It cannot control their actions. It can offer them an end on which to fix their minds. And, as their minds are, so in the long run and with exceptions, their practical activity will be.’ (Tawney 1982 ch 11).


Importantly, in arguing for the functional society in which human activities are organised in accordance with purpose, Tawney emphasises that ‘The first condition of the right organization of industry is, then, the intellectual conversion which, in their distrust of principles, Englishmen are disposed to place last or to omit altogether.’ (Tawney 1982 176).


Tawney’s ‘first condition’ is Schumacher’s ‘first task’ – a mental, moral and metaphysical reconstruction, the creation of a standpoint or viewpoint through which to organise practical activities and common affairs. That’s the bit people are more likely to ignore, because it is the most difficult bit, the most intractable. It is easier to go to the physical tools and start acting. But the problem of common living is not an engineering problem, it is a social and moral one. Ignore that fact, and we just get more of the same, an endless technological fixing that generates problems as it solves them.


‘If the conditions which produce that unnatural tension are to be removed, it can only be effected by the growth of a habit of mind which will approach questions of economic organization from the standpoint of the purpose which it exists to serve, and which will apply to it something of the spirit expressed by Bacon when he said that the work of men ought to be carried on “for the glory of God and the relief of men's estate."’ (Tawney 1982


Anyone who is inclined to dismiss such a view as utopian and idealist needs to consider the alternative:


‘The alternative is war; and continuous war must, sooner or later, mean something like the destruction of civilization. The havoc which the assertion of the right to unlimited economic expansion has made of the world of States needs no emphasis. Those who have lived from 1914 to 1921 will not ask why mankind has not progressed more swiftly; they will be inclined to wonder that it has progressed at all.’


We are still wondering.


Ultimately, it is the principles upon which society is founded, the values which persons hold, the purposes by which people live, and the visions they pursue that matter the most. The principle which Tawney advanced, and which Schumacher was to reaffirm decades later, is that industry, property and economic activity should be arranged and scaled in terms of functions related to a social purpose. ‘Such a political philosophy implies that society is not an economic mechanism, but a community of wills which are often discordant, but which are capable of being inspired by devotion to common ends.’


Conservatives may not like talk of class struggle. Tawney didn’t like it either, and he opposed Marxism. But, asserting a Christian social ethics, he drew attention to the origins of such struggle in a divided and atomistic society bereft of true social purpose. ‘That attempt to conduct human affairs in the light of no end other than the temporary appetites of individuals has as its natural consequences oppression, the unreasoning and morbid pursuit of pecuniary gain of which the proper name is the sin of avarice, and civil war.’


It is of some significance that when Tawney seeks to describe his functional society, he finds inspiration in the words of Dante Alighieri concerning the power of love and the respect for boundaries, ‘through which our wills become a single will’, the peace of the blessed life.

...

Tawney’s conclusion is worth quoting and pondering at length:


‘Such a combination of unity and diversity is possible only to a society which subordinates its activities to the principle of purpose. For what that principle offers is not merely a standard for determining the relations of different classes and groups of producers, but a scale of moral values. Above all, it assigns to economic activity itself its proper place as the servant, not the master, of society. The burden of our civilization is not merely, as many suppose, that the product of industry is ill-distributed, or its conduct tyrannical, or its operation interrupted by embittered disagreements. It is that industry itself has come to hold a position of exclusive predominance among human interests, which no single interest, and least of all the provision of the material means of existence, is fit to occupy. Like a hypochondriac who is so absorbed in the processes of his own digestion that he goes to his grave before he has begun to live, industrialized communities neglect the very objects for which it is worth while to acquire riches in their feverish preoccupation with the means by which riches can be acquired.


That obsession by economic issues is as local and transitory as it is repulsive and disturbing. To future generations it will appear as pitiable as the obsession of the seventeenth century by religious quarrels appears today; indeed, it is less rational, since the object with which it is concerned is less important. And it is a poison which inflames every wound and turns every trivial scratch into a malignant ulcer. Society will not solve the particular problems of industry which afflict it until that poison is expelled, and it has learned to see industry itself in the right perspective. If it is to do that, it must rearrange its scale of values. It must regard economic interests as one element in life, not as the whole of life. It must persuade its members to renounce the opportunity of gains which accrue without any corresponding service, because the struggle for them keeps the whole community in a fever. It must so organize its industry that the instrumental character of economic activity is emphasized by its subordination to the social purpose for which it is carried on.’ (Tawney 1982 ch 11)."

(https://pcritchley2.wixsite.com/beingandplace/post/2015/05/08/the-economics-of-purpose-ef-schumacher-and-rh-tawney)