Economics as if people mattered

In one of the comboxes below, Scott Lahti sent me to this excerpt of a Godspy interview with Joseph Pearce, the Catholic writer who recently wrote a book about the continuing relevance of "Small Is Beautiful" author E.F. Schumacher's ideas:

It sounds very similar to what Pope John Paul II wrote in his encyclical Centisimus Annus, when he said his criticisms of capitalism "are directed not so much against an economic system as against an ethical and cultural system" that "reduces man to the sphere of economics and the satisfaction of material needs." People on both the left and the right have a hard time understanding that it's not just about economic systems.

Yes, and one result of that is that for a long time people have assumed that economics have a blind, deterministic power, whether that's a result of the Hegelian philosophy of the Marxists, a sort of economic determinism, or the result of the economic libertarians, who claim the hidden hand of the market is not only all-powerful but beneficial, so both of those beliefs have really dominated economic thinking one way or the other...

They're both materialist philosophies...

Yes, they don't take into account that economics is a servant not a master. Now, in terms of Marxism, things have not evolved as Marx predicted they would, so that kind of economic determinism has lost all credibility, except for a crackpot few. But with economic libertarianism, the issue there is we need to examine their assumptions: First, the free market doesn't really exist, for a number of reasons. People are always interfering with the market, advertising distorts the market, the size of economic activity distorts the market, government policy distorts the market, government subsidy distorts the market, free trade, protectionism distorts the market; the free market as a theory is actually a fallacy in the sense that there are market forces but they're never free, they're always being manipulated by somebody, whether its government or big business, so the issue is how do we interfere with the market, what actually do we want the market to be doing, how should it be manipulated for the common good. I know that libertarians, when they hear the phrase 'the common good', they think you're a communist. But of course, the whole Catholic concept of subsidarity is that both economic and politics should be done on a human scale; it's not only about small businesses but also about small government, that we want the de-volution of power away from big central government back to regional government; we want laws that do not encroach upon the rights of the family, so this is very, very different than a state-run society.

The focus is on the human person...

Yes, for the dignity of the human person. It's about recognizing that the human person has dignity and that economics and politics should serve that dignity and the person should not be subjected to forces which are contrary to human dignity.

[snip]

About the Greens, beyond their Marxism, they've also become even more obsessed by sexual politics, by radical personal liberation, don't you think?

Exactly. In many respects it's very hedonistic, and of course hedonism works against both environmental health, and individual health. You can't have a system based on selfishness in moral issues and expect, at the same time, to have an economic system based on self-restraint. It's a contradiction. On the one hand, they want complete self-centered liberation from all ethical constraint, and on the other hand, they expect people to behave economically and socially with self-restraint, and that doesn't compute.

It's ironic that in terms of traditional Marxism, whatever you think about it, it certainly wasn't about personal or sexual liberation...

Quite frankly I think in the nineteenth and early twentieth century many people who were Marxists were responding to genuine economic injustices; however wrong their solutions were, they may have been well-intentioned. But a large part of the underlying philosophy of the Marxist or Green left today is based upon hatred of the whole of western civilization, driven by the desire to be iconoclastic against anything they consider to be traditional. Of course the result is that it leads to the breakdown of self-control, and people become hedonistic, which doesn't just mean having many sexual partners, but means having a disposal mentality in everything else, so that people like this live a very unhealthy lifestyle from the point of view of the environment, and from the point of view of their own sexual health, the sexual health of others, and social cohesion in general.

Check out the E.F. Schumacher Society.

What would Schumacher say to the presidential candidates if he could sit down with them today for an advisory session? Thoughts?