This is a book review of E. F. Schumacher's 1973 title, "Small is Beautiful: Economics as if People Mattered."
With the reputation that preceded the book, I thought that Schumacher was some kind of hippy. And after reading it, I still think that he is. But he was also an "insider," serving on the British Coal Board for many years.
I've been attending Slow Money's National Gatherings since 2010. It seems like every time I see Woody Tasch speak [its founder], he quotes Schumacher. I recently went to the opening of Slow Money Vermont, and heard yet another Schumacher reference. So I finally went to one of my local used-book stores and picked up a copy. Fittingly, I finished the book on the plane to the Louisville National Gathering about a week ago.
I can say that the book is as good as Woody would have you believe. I'll just start diving in with excerpts:
I think it was the Chinese, before World War II, who calculated that it took the work of thirty peasants to keep one mane or woman at university. If that person at the university took a five-year course, by the time he had finished he would have consumed 150 peasant-work-years.
Which he follows with two quotes:
I sit on a man’s back, choking him, and making him carry me, and yet assure myself and others that I am very sorry for him and wish to ease his lot by any means possible, except getting off his back. - Leo Tolstoy
Much will be expected of the man to whom much has been given. More will be asked of him because he was entrusted with more. - St. Luke
This degree of perspective, broad yet deep, often isn't achieved. The peasant-year analogy is no different today. Although the relationships are less obvious. The US has the biggest economy in the world not because of our own "production," but because of how we take advantage of people and natural resources in developing countries. Each year of my life as an American might be eating up something on the magnitude of thirty years of the lives of those in Brazil, China, or Africa.
As the violence is forgotten, so is the privilege. If a comparison was warranted, the ways we eat up fossil fuel might be argued to be even more irresponsible; at least people are renewable.
Schumacher sees beyond all of this to the underlying systems. Here's one of his inclusions that hints at this:
War is a judgement that overtakes societies when they have been living upon ideas that conflict too violently with the laws governing the universe…Never think that wars are irrational catastrophes: they happen when wrong ways of thinking and living bring about intolerable situations. - Dorothy L. Sayers
If I hold a rather negative opinion about the usefulness of “automation” in matters of economic forecasting and the like, I do not underestimate the value of electronic computers and similar apparatus for other tasks, like solving mathematical problems or programming production runs. These latter tasks belong to the exact sciences or their applications. Their subject matter is non-human, or perhaps I should say, sub-human. Their very exactitude is a sign of the absence of human freedom, the absence of choice, responsibility and dignity. As soon as human freedom enters, we are in an entirely different world where there is great danger in any proliferation of mechanical devices.The tendencies which attempt to obliterate the distinction should be resisted with the utmost determination. Great damage to human dignity has resulted from the misguided attempt of the social sciences to adopt and imitate the methods of the natural sciences. Economics, and even more so, applied economics, is not an exact science; it is in fact, or ought to be, something much greater: a brach of wisdom.
My favorite word in this passage is "sub-human." Earlier in the book Schumacher starts sketching out the thresholds between "divergent" [real] and "convergent" [abstract] thinking. Here's an excerpt from Darwin's autobiography:
Up to the age of thirty, or beyond it, poetry of many kinds…gave me great pleasure, and even as a schoolboy I took intense delight in Shakespeare, especially in the historical plays. I have also said that formerly pictures gave me considerable, and music very great, delight. But now for many years I cannot endure to read a line of poetry: I have tried lately to read Shakespeare, and found it so intolerably dull that it nauseated me. I have also lost almost any taste for pictures or music … My mind seems to have become a kind of machine for grinding general laws out of large collections of fact, but why this alone should have caused the atrophy of that part of the brain alone, on which the higher tastes depend, I cannot conceive… The loss of these tastes is a loss of happiness, and may possibly be injurious to the intellect, and more probably to the moral character, by enfeebling the emotional part of our nature.
In other words, Darwin's thought patterns eventually turned him into a machine, unable to access the hallmark emotional center of the human experience.
And today, we too have become machines. Our treatment of economics as a science has converted us all into cogs in the machine, as the cliche goes. Well, it's not that simple; we could get into spirituality. And Schumacher does:
The Buddhist point of view takes the function of work to be at least threefold: to give a man a chance to utilize and develop his faculties; to enable him to overcome his ego-centerness by joining with other people in a common task; and to bring forth the goods and services needed fro a becoming existence…To organize work in such a manner that it becomes meaningless, boring, stultifying, or nerve-racking for the worker would be little short of criminal; it would indicate a greater concern with goods than with people, an evil lack of compassion and a soul-destroying degree of attachment to the most primitive side of this worldly existence. Equally, to strive for leisure as an alternative to work would be considered a complete misunderstanding of one of the basic truths of human existence, namely that work and leisure are complementary parts of the same living process and cannot be separated without destroying the joy of work and the bliss of leisure.
Mid-way through the book Schumacher presents us with some nice axioms:
The amount of real leisure a society enjoys tends to be in inverse proportion to the amount of labour-saving machinery it employs.
The prestige carried by people in modern industrial society varies in inverse proportion to their closeness to actual production.
Throughout the entire book our author confronts the dissonance between our abstract modern cultural constructions and our deeper human attributes. Between the operationalized financial economy and the dynamic natural world. He settles on an integrative perspective, exploiting the polarizing dualism of the mainstream worldview:
Anything we do under the heading of ‘production’ is subject to the economic calculus, and anything we do under the heading of ‘consumption’ is not. But real life is very refractory to such classifications, because man-as-producer and man-as-consumer is in fact the same man, who is always producing and consuming at the same time.
As a systems thinker, he's at home with mythology. "We have become confused as to what our convictions really are.” In other words, failures of civilization are failures of mythology.
In some ways I found the book rather discouraging. If it was published today, many might say it's representative of the cutting edge of alternative economics. And yet it was written over forty years ago. Has our situation improved? Well, the natural world is certainly more strongly in decline. But the bastions of creative culture seem to be growing stronger.
An excellent book about economics, development, and systems thinking. Grounded in cosmology.
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