«ISSUE Vol. VIII No. 1 March 2013 ERENET PROFILE CONTENT SPRING MESSAGE PUBLISHER Dr. Péter Szirmai – Editor PAPERS Dr. Antal Szabó – ...»
Most people consider avarice, as the core of the problems. Some think that there is a worldwide conspiration (of certain groups, e.g. multinationals, banks etc.), others go further and start to think that humankind is fundamentally of destructive nature11 and there is no hope. We see immense nostalgia to “natural tribes” or the supposed harmony of animist religions with nature and society. The common denominator of these opinions is that something has severely gone wrong. But there is absolutely no common thinking whether we should close the banks, abolish money or do not rather regret the envisioned extinct of man (e.g. by James Lovelock). The debate has become ideological, a good example is that everyday people consider overpopulation12 as one of the
three most urgent causes of unsustainable development, while numbers tend show exactly the opposite:
environmental, social and economic sustainability. There is a consensus on the properness of TBL, among business practitioners.
Due to correctness and what is more important, optimism, we have to see that at least on one field we seem to have managed the problems: The Montreal Protocol banning cooling and propelling agents containing CFCs is among the very few success stories of global environmental protection.
As a funny nature conservationist t-shirt formulates: „I am with the bats!” The Moscow Demographic Summit had almost 1000 participants. Other interesting contributions to the topic are the two twin-articles of Tamás Krúdy. In the first article he describes anti-population opinions of supposedly good-intended and unsuspecting scientists (Malthus, Rousseau, Condercet, then Ehrlich and Holdren in the 20th century), but also the very intended and morally rather questionnable movement, which reached its peak int he 1980s, and had been born from the fear of overpopulation (Margaret Sanger, International Planned Parenthood Federation). The article also
describes the forced depopulation pursuits of Chine, Peru and India. Amartya Sen gave an effective answer to these:
„The strategy emphasizing the priority of birth control sends the following message to the poor of the world: ‘We wish you were not here!’” The second article analyses the NSSM 200 document, in its poular name the Kissinger-report, which became public 25 years after it was made. This is the conscious position taking and strategic document of the USA, whereby it is clearly stated: “The political consequences of current population factors … are damaging to the ERENET Profile Vol. VIII, No. 1. www.erenet.org
internal stability and international relations of countries in whose advancement the U.S. is interested, thus creating political or even national security problems for the U.S.” The USA wishes to interfere into the population policy of developing countries through aid policies, especially through international organizations of neutral nature like the UN or the World Bank.
Be it the level of macroeconomics (more GDP), micreconomics (more profit) or consumers (more discretional real income).
ERENET Profile Vol. VIII, No. 1. www.erenet.org buy anything, if it is at reasonable price, while have been educated the more they consume the better14.
Ultimately the three main economic actors are bound together in the vicious circle not by GDP, money, profit, not scientific rationale, international intent or other external force, but their very own, shared vision, that is the consumption ideology: ‘everybody is better off, the more and the cheaper products available on the market.’ Substituting GDP to alternative indicators, eco-efficiency or developing eco-friendly products bring about very slight actual change, as we could experience in the last decades. The mental chip, the ideology should be be modernized, the software (in this sense the human person) functions in order. And modernization does not mean quicker here, at any rate.
ECONOMISM, AS A QUASI-RELIGION
The original meaning of economics (in Latine and ancient Greek: oeconomia) was the careful management of the household. In the last 230 years it has become a social science, later an ideology and a general paradigm, and by today a quasi religion, with its ‘holy trinity’: efficiency-competition-growth.
When we hear these expressions, we do not think twice whether their improvement is good for us or not, or what is the price we pay for a more competitive economy (eg. escalated hurry), for a more efficient operation (eg.
more machines, bigger scales, less jobs), or for a higher profit (SMEs and local industry go bankrupt). Although
not consciously, we tend to consider the three elements as moral goods of the highest priority, in religious terms:
idols In the attached table (6) the essential points of a Illustration 5: The ’holy trinity’ of economism religion and a science are summarized. Naturally this is to a large extent generalization, since the basic differences between a natural and a social science, or the main motives in Islam or the Protestan Church. 15 The comparison is still useful from the point of view of our subject area, because we are on a safer side in comparing specifically Economics and Christianity. The two systems show deep analogies, except for the last row. Positive science is declared to be descriptive and explanatory, it doesn’t render commands or norms to follow. This is its main difference to a religion, where faith is exercised through action.16 Where a scientist makes himself a philosopher, politician or campaigner, and most of all makes his theory – which is valid within certain limits of the model – a universal principle, problems start to occur. In this case scientific theory becomes an ideology – this is the danger of – isms.
In the case of economics the situation is not favourable, as it is not based on a declared axiom, which would be accepted by the majority of people. In the economic education, normally Adam Smith’s Wealth of the Nations is cited, as the formulation of the axiom. The axiom would be that humans instrinsically follow their selfinterest, utmost motivated by their own material utilities. Literature refers to this as homo oeconomicus.
And let us add that more consumption is really good for our soul to a certain extent, if it does not make other values neglected. Material consumption is also a must to keep up our body.
Islam is for example a strictly monoteic religion in the narrow sense, while Christianity understands the one God mystically as the unity of three persons, the Holy Trinity. Christianity adheres to Jesus Christ being the true son of God, as the central and most important doctrine.
Jesus says: „Not every one that saith unto me, Lord, Lord, shall enter into the kingdom of heaven; but he that doeth the will of my Father which is in heaven.” (Mt 7,21) And the Father’s will is love, we have to love each-other as God loved the world. This is the topmost commandment, which tops up the Decalogue of the Old Testament.
ERENET Profile Vol. VIII, No. 1. www.erenet.org
First let’s have a look what Smith states in the Wealth of the Nations, where the publication year (1776) is also the start of the modern (utilitarian) economics. Smith deals a lot with work distribution, but the essence of the book – at least as long as we remember it after 235 years – is the two basic characteristics of men. According to Smith everybody strives to improve his/her material circumstances, from cradle to grave. On the other hand
we exchange and trade, from our very nature. The most cited paragprah of the book is:
It is not from the benevolence of the butcher, the brewer or the baker, that we expect our dinner, but from their regard to their own interest… We address ourselves, not to their humanity but to their self-love (p. 16.) Immediately the question occurs, how shall we derive the public good from everybody pursuing his
individual self-interest? Smith cuts the Gordian not with the invisible hand:
As every individual, therefore, endeavours as much as he can both to employ his capital in the support of domestic industry, and so to direct that industry that its produce may be of the greatest value; every individual necessarily labours to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other eases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it (p.456).
Alas very few economics and business students read the original work of Adam Smith. In our hasty life, where the quantity of information we have to process almost makes us sick, most of the people are content with the two citations above. Reading the original texts in their original context is simply not a requirement.
If somebody still undertake toil and moil and reads the original text of the Wealth of Nations, he could be astonished to see that the two citations (and their spirit) only one page of the book! What is more, they are very remote from each-other. The Wealth of the Nations17 is actually five books on 950 pages. The central topic of the first book is the division of labor, Illustration 7: The two famous citation in Adam Smith’s Wealth this is where Smith analyses how demand and of the Nations – not related supply would determine the natural price. The author wrote an introductory chapter, which is only four pages long, with the forst citation about the baker and the brewer. Smiths uses it as an argumentation for the division These references are made to corresponding pages of the best modern edition, the socalled Glasgow Edition: Adam Smith: An Inquiry into the Nature and Casuses of the Wealth of Nations. The Glasgow Edition of the Works and Correspondence of Adam Smith, vol. II, edited by R.H. Campbell and A. S. Skinner, Oxford University Press, 1976.
ERENET Profile Vol. VIII, No. 1. www.erenet.org of labor, but the selfish nature of man is not verified or supported, the reader is straightforwardly dehorted from thinking about its causes. In Smith’s opinion the division of labor developed from our nature declining to trade and exchange, but the term homo oeconomicus never appears in the book. In the fourth book the author disputes the ideas of both the mercantilists and the phisiocrats, and forms his opinion that open economies are the most superior. In this part he deals a lot with colonies. The second chapter has a 21 page long chapter of analysing imports and autarky, this is where the invisible hand is mentioned once on page 456. So the two citations, which fit so well in economic textbooks, have a gap between them of over 400 pages, without any cross-reference. We cannot find any economists or political philosopher, who described or explored the axiom of homo oeconomicus in a convincing manner, or empirically tested the validity of this image of man.
Among the philosophers it was the French Claude-Adrien Helvétius (1715-1771), who laid down the utilitarian basics in his opus published in 1758, titled De l'esprit. Its central message is that although man is motivated by self-interest and self-love from his birth, this natural egoism makes a proper fit with community ethics, the central principle of public good: the individual and public interest is the same, self-interest can serve the community. According to Helvétius the main question is only the right education, wich makes the link between the two. At the same level we can mention Jeremy Bentham (1748-1832), English jurist and philosopher, who is regarded as the founder of utilitarianism, which makes happiness (utility) and self-interest the central topic of life and the value system. Bentham judges legal and political institutions based on the fact, how much they elevate the greatest happiness of the greatest number of people. He emphasized that the utilitarian principle can work in practical life, there is a calculus measuring which of two deeds is more useful.
We can see that economics, as a theoretical science is based on a very labile foundation, because the ever increasing maximization of profit and individual utility cannot be supported, and with this the idealtype of the profit-maximizing corporation and the rational consumer as well. Most of all the legitimation basis of the system is staggered, whether we always serve the common good through serving ourselves, becomes strongly questionable. Still, the system has been functioning for a long period, supporting huge numbers of people at an unprecedented high level of material welfare, which also guranteed health, peace, schooling etc.
However, in tha last decades critical voices have become louder, more and more people believes that the system built on the expansion of economics also produces loosers. Since 2008 we can speak about the widely acknowledged fiasco of economism. Its symbolic signs are the wavering European economies, which have always been considered as the flagships of capitalism. Economism, as developed from the utilitarian economic theory has evolved to a quasi religion, which is almost monolithicly followed by the political and business elite of the world. In the next chapter we speak about religious economic schools, but it would be a naivity to suppose that Buddhist countries are governed on the moral basis of Buddhist economics, Arab countries with Islamic economics, Europe and America with Christian economics. Albeit secularization is very much different in these regions, moral principles fall everywhere far from the steering-wheel: the leading elite is a common believer of the world-religion of economism, the ‘holy trinity’ of efficiency, competitiveness and growth. Very few conceive this as a religious belief18, even fewer admit that their views are rather fanatic, based on opinions and myths, not on engineering calculus and rational assessment. For this reason we can understand economism as a quasireligion. To illustrate this, we can formulate the ten commandments, and the creed of the economism-religion19.