Thursday, July 19, 2007

Chapter 3 : The Role of Economics

I would be a terrible business man. I know that, from growing up with a couple of pretty good ones. Not to say I did not prosper from their labors, but what I do know is that money can buy a lot of things--in my case, a cozy upbringing and a full college education (which I may well have wasted on an Arts degree). What it does not buy is happiness. I suppose we all build our little Tower of Babels, only to have them crumbled and leave us more lost than ever.

Schumacher writes:
"To equate things means to give them a price and thus to make them exchangeable. To the extent that economic thinking is based on the market, it takes the sacredness out of life, because there can be nothing sacred in something that has a price."

How this resonates with me, for I often feel that anything I do is often poisoned when money is involved. In the arts, and probably anything I choose to labor over for whatever "spiritual" reasons I choose, discussion of money plays like a flat note in an otherwise beautiful arrangement. It hints that my labors are simply for the end result of fiscal gain, rather than for my own pleasure or altruistic motives.

I suspect that gift cards, in an odd way, serve to soften the blow. There is something more altruistic about a gift card to Olive Garden than receiving a wad of hard-earned cash, quickly stuffed in your pocket as if it never existed. I suppose then, the hard-lined economists that Schumacher distastefully speaks of would consider me an anomaly, or in his own words, "uneconomic."

As Michelle and the book thus far has spoke of, the economic theory is flawed since it presupposes an infinite supply and demand. We know now that the supply is actually quite finite, or could well become so.

And yet, do I believe that recognizing this fact would cause us, as bargain-hunting consumers, to discontinue our industries for greater spiritual causes, such as conservation? I think we can, but it certainly wouldn't be for the objective cause of conservation, but rather to ward off the dangers that we might make for ourselves if our recklessness continues.

I had just read a poll that said that Americans would reduce their driving habits if gasoline prices rose to $3.50. I suspect that similar polls may have taken place when gas neared a meager 2 bucks. In my cynicism, I'd believe that gas would have to rise much higher before middle America considered the bus to be a wise economic choice--almost to the point where a vehicle that runs on olive oil would actually be nominal.

Until then, Live Earth and Al Gore has a steep hill to climb--as steep as their rising temperatures charts. I should conclude that economics, and science alike, are amoral. People are not. But often their moral notions are muddied by economics--money as a divine creation. There are certain presidential candidates that believe that money is a gift from god--and to throw a stone in the gears of our economic system is to disobey god, endanger democracy, and create war, poverty, and terrorism.

Much of my motivation is not economic, or rather, "uneconomic," but I do live in a system that doesn't recognize such a thing--and forces upon me, again and again, the tacky exchange of dollars and cents, that so poisons everything I would rather leave to humble charity and good will.

4 comments:

Chris said...

Steve, your post reminds me of how strange it is that the economic frame of mind has infiltrated practically every way of our viewing life. In relation to your thoughts, I think, we could add the following remark by Schumacher:

"But what does it mean when we say something is uneconomic? I am not asking what most people mean when they say this; because that is clear enough. They simply mean that it is like an illness: you are better off without it. The economist is supposed to be able to diagnose the illness and then, with luck and skill, remove it. Admittedly, economists often disagree among each other about the diagnosis and, even more frequently, about the cure; but that merely proves that the subject matter is uncommonly difficult and economists, like other humans, are fallible.

"No, I am asking what it means, what sort of meaning the method of economics actually produces. And the answer to this question cannot be in doubt: something is uneconomic when it fails to earn an adequate profit in terms of money. The method of economics does not, and cannot, produce any other meaning." (Ch. 3, pp. 27-28)

Thus, all other experiences of value are reduced to something secondary, only allowed to follow after the imposed value of the economic system that trumps all things, including politics often enough. I had a professor who was working on an MA in public policy on the side (just because he wanted to understand it better!) and I'll never forget him telling me that pretty much all public policy that was taught at the school came primarily from the economic mindset.

This reminds me of one more intriguing comment from Schumacher, this time on the GNP and how economists focus almost entirely on quantitative analysis and fail to make qualititative distinctions in their studies (one of the most insightful points in the chapter, in my opinion):

"For example, having established by his purely quantitative methods that the Gross National Product of a country has risen by, say, five per cent, the economist-turned-econometrician is unwilling, and generally unable, to face the question of whether this is to be taken as a good thing or bad thing. He would lose all his certainties if he even entertained such a question: growth of GNP must be a good thing, irrespective of what has grown and who, if anyone, has benefited. The idea that there could be pathological growth, unhealthy growth, disruptive or destructive growth is to him a perverse idea which must not be allowed to surface." (p. 33)

Beautifully stated. Yet, if we don't like this "economic" perspective overriding all others, why do we seem to so easily succumb to it? Why has this system in many respects only continued to grow? Why is there so little resistance?

Chris said...

Steve said,
"Until then, Live Earth and Al Gore has a steep hill to climb--as steep as their rising temperatures charts. I should conclude that economics, and science alike, are amoral. People are not. But often their moral notions are muddied by economics--money as a divine creation. There are certain presidential candidates that believe that money is a gift from god--and to throw a stone in the gears of our economic system is to disobey god, endanger democracy, and create war, poverty, and terrorism."

I'm not so sure about all of these statements. I do agree that we have a serious problem with people and politicians who essentially think Moses came down the mountain with our current economic system. Sometimes I wonder if the religious right is in the least bit aware of those admonitions from Jesus about the temptations of riches.

What I wonder about is your idea that science and economics can be called amoral. This seems to go in part against Schumacher's own assessment of economics in chapters two and three, wherein he speaks of the science of economics (at least in the modern West as we generally understand it) as relating "to certain very strong drives of human nature, such as envy and greed" (p. 31; see also pp. 12, 24-25). As often is the case, this issue may largely depend upon how we define these terms. However, since it appears as though Schumacher will elaborate upon this topic in chapter four )"Buddhist Economics"), perhaps we can just wait until after we've read that far before actually delving into this question more fully. I just wanted to throw it out there for the time being though.

steven said...

Well, greed and envy is only as it is--I don't think they are only capable of doing harm. Envy can be an incentive to do or be something better. Greed--well, I suppose its value depends upon what exactly one is greedy for. There are some who love violence and are callous towards life, and if directed properly, can become decorated soldiers. Same with religion, though I might argue that it is capable of far more harm than good.

So I might then disagree with Schumacher if he believes economics, by necessity, seeks to exploit the human condition for harm's sake. It's far too relative.

Chris said...

Steve, thanks for the reply, though it's a bit confusing. What you seem to think of as "greed" and "envy" sounds more like what might typically be defined simply as self-interest or desire. Obviously, this is always present (even in altruistic actions, I think). However, "greed" and "envy" aren't typically defined that way. They are rather described as excesses or aberrations of self-interest or desire. I hope that clarifies our terms somewhat, though let me know if you disagree.

Now, I have a feeling, based on the title of the next chapter (though I've yet to read it), that Schumacher doesn't think all economic systems have to promote our natural drives in unhealthy ways. However, I do think that it is one of his main contentions that modern economics in the West have typically promoted self-interest in an extreme and destructive fashion, naively believing that the "invisible hand" of the market will always harmonize these forces for the good of everyone.

Personally, I have to agree with his assessment, for I still find it hard to view economic systems as amoral or neutral. They are by their very nature promoting a certain way of life, particular practices, and various ideals, all of which effect much more than just the mere exchange of money, goods, and services. Thus, I think we have moved, at least to some degree, into the realm of moral and ethical questions.

Let me know what you think of this.