David Begg: A few weeks ago I happened upon an RTÉ radio programme in which the author John Banville was talking about the genre of the Scandinavian crime novel. He noted that mostly these novels begin with a horrific crime scene with blood all over the place. Questioned by the interviewer about the attraction of extreme violence to readers he suggested that we have an inbuilt disposition to violence. He argued that this is what motivates young men to join ISIS, for example.
By coincidence there was an article by George Monbiot in the Guardian the following day arguing the direct opposite, i.e. that people are basically good. This is an argument that has divided philosophers – like Thomas Hobbes and Jean-Jacques Rousseau – down through the centuries.
Whichever side of the argument you prefer it is at least obvious that human beings are more complex and nuanced in their motivations than is allowed for in much of the theorising that underpins orthodox economic policy.
Paul Krugman has characterized the principles and practices of modern economics as “faith-based”. By this he means economists place untestable economic logic – justified by a theology of faith in presuppositions and assumptions – over and above years and decades of historical and sociological evidence. Krugman, in fact, links the economists’ failure to foresee the financial crisis of 2008 to exactly that kind of reasoning. “As a group,” he writes, they “mistook beauty, clad in impressive-looking mathematics, for truth.”
He continues: “The central cause of the profession’s failure was the desire for an all-encompassing, intellectually elegant approach that also gave economists a chance to show off their mathematical prowess …… this romanticized and sanitized vision of the economy led most economists to ignore all the things that can go wrong. They turned a blind eye to the limitations of human rationality that often leads to bubbles and busts; …… to the imperfections of markets ….that can cause the economy’s operating system to undergo sudden, unpredictable crashes”. ¹
What are the origins of these presuppositions and assumptions which are so compelling as to triumph over empirical evidence?
In fact they can be traced back to the political economists of the late eighteen and early nineteenth centuries, specifically to the concept of ‘social naturalism’. Social naturalism is an approach to understanding the social world that assumes that human society and the natural world both work according to the same laws of nature.
This is a concept mainly associated with Joseph Townsend’s allegorical fable of goats and dogs on a deserted island that, despite predatory competition for survival, lived in harmonious equilibrium. This became the inspiration for Thomas Robert Malthus and David Ricardo who justified using goats and dogs as allegorical proxies for human beings on the presumption that there was no difference in the biological instincts that drove humans and animals alike.
This, in turn, justified social policies designed to trigger biological drives, rather than human morality or social responsibility. Malthus in particular advanced the view that, regardless of moral capacities, people are first and foremost biological beings motivated by the instinctive drives to eat and have sex. Reflecting the brutal struggle for survival endemic to nature and society alike, however the two drives are at war with one another. Malthus used Townsend’s allegorical tale of goats and dogs to explain the situation of the English poor at the end of the eighteenth century. The harmony of the goats and dogs was only possible because nature was left without interference to allow the fittest to survive.
In a new book Fred Block and Margaret Somers (2014) ² explain how, daft as it sounds, this Malthusian fantasy became the basis for modern market fundamentalism. Social Naturalism delegitimised a public philosophy and those social policies that appeal to the common good, to social morality, to collective conscience or social compassion.
Should you have occasion to travel the old road between Swords and Balbriggan you may notice at Balrothery the ruins of a very austere looking old building. It is the Balrothery workhouse which I learned as a child was the place where famine victims lived in terrible conditions in the mid-nineteenth century. This is not the complete story.
The Malthusian influence was central to the enactment of the new poor law in 1834. Prior to that date public policy accepted it as one of the realities of life that some cohort of the population would lack the means to live a decent life through no fault of their own and needed to be provided for. This was the basis of parish level public assistance under the old poor law.
This changed fundamentally after 1834 such that coercive means were used in the belief that, left to their own devices, the poor would see public relief as a justification not to work and an encouragement to procreate in the knowledge that children would be provided for. The workhouse ensured that only the most desperate would go to a place where the sexes would be separated, food and clothing was minimal, and a humiliating and harsh regime dominated.
Block and Somers point to evidence which suggests that 1834 was a critical juncture and that the Malthusian influence can be identified in certain ideas underpinning welfare policies, particularly in liberal market economies, even today.
Because all aspects of human existence are subordinated to that of Homo Economicus, the kind of knowledge produced by sociologists, anthropologists, historians, and other social scientists is effectively marginalised. With economic laws established as the foundation of social existence, practitioners of economic science are elevated to be the reigning Czars of public philosophy and public influence. Yet, as we have seen, this economic science rests on ancient and dubious foundations.
Perhaps it explains why we have such difficulty nowadays grappling with apparently straightforward social issues such as public housing.
David Begg is Director of TASC
1. Krugman, Paul (2009) ‘How Did Economics Get It So Wrong?’ New York Times. Sept 2nd. P.36
2. Block, Fred and Somers, Margaret R. (2014) The Power of Market Fundamentalism; Karl Polanyi’s Critique. Harvard MA. Harvard University Press