Sunday, April 28, 2013

Economics as a Religion and the Idea of Progress

The idea of economics as a religion is not so farfetched after all. The scientific revolution came right at the same time as social relations were undergoing a profound shift in Western Europe. The Church's influence had been waning since a large part of the flock had broken off during the Reformation, partially in relation to the corruption of the Catholic Church (for example, the selling of indulgences to raise money for the pope's lavish lifestyle), and partially because the monopoly the Church held over scripture had been broken by the printing press and translations of the Bible into vernacular languages.

Combine that with the remarkable discoveries of science and mathematics, and the rise of a burgeoning merchant class whose wealth and influence was beginning to rival those of the feudal aristocracy and clergy, and you've got yourself a  bona-fide social crisis. The universal Catholic Church (a redundancy), which had presided over the social life and rituals of a relatively stagnant Western Europe since the fall of the Roman Empire, was coming under a lot of pressure to accommodate the  new ideas, and was pushing back as large hierarchical systems inevitably do.

Things came to a head in the days leading up to the French Revolution. Ideas began to circulate in the coffee houses of Paris that were actively and openly hostile to the concepts of monarchy and religion, ideas which would have been thoroughly squelched in years prior. A number of philosophers (the philosophes) wrote treatises that considered human social relations in light of logic and rationality (as did earlier English philosophers such as Hobbes) rather than custom and tradition. The encyclopaedist Denis Diderot famously wrote that "mankind will never be free until the last king is strangled with the entrails of the last priest." The colonies of the New World existed beyond the range of kings in self-governing mode, and England's thirteen colonies decided to become completely independent and go their own way, with no king or state religion. It was explosive stuff.

The powder keg went off during the French Revolution - the King and much of the aristocracy was killed, and the old social order was upended. Products were flowing in from every corner of the world, and Europeans came in contact with cultures that had never even heard of Catholicism, yet seemed to function more or less serviceably. The first factories came online, and the rural and household economies was just starting to come under pressure from mass industrialism. New Protestant Christian sects based upon disparate readings of the Bible by various itinerant preachers began popping up like daisies and spreading new religious ideas. The latter half of the eighteenth century seemed to upend a social order that had existed for as long as anyone could remember. The question was, what would replace it?

So if you were a philosopher living around this time, what form  the "new" social order would take was a foremost concern. One of the lesser-known people to seriously take this question up was Claude Henri de Rouvroy, comte de Saint-Simon.

Saint Simon was an aristocrat who had seen both revolutions - he had fought in the American revolution, and had manage to survive (although he was imprisoned for a time) the French revolution. He decided to dedicate his life to philosophy after experiencing a "vision" of Charlemagne in prison. Despite his passion for philosophy, Saint-Simon's ideas never coalesced into a coherent doctrine, and his thinking was often muddied, confused and repetitive. He seemed to arbitrarily bring up ideas and then abandon them, reacting to events of his time rather than attempting to bring his ideas in any sort of consistent or practical conclusion (today he would probably be diagnosed as bipolar). Nevertheless, his ideas did have a profound influence on the next generation of European philosophers, developing a following around him, and even, briefly, a religion.

For religion was central to Saint-Simon's ideas. Before Nietzsche proclaimed the death of god, Saint-Simon felt that religion had become outmoded, and that the Church's control over peoples' behavior was fading into irrelevance thanks to social changes, economic realities and scientific discoveries, yet he believed that religious ideas were absolutely essential for the harmonious functioning  of society. He believed that the masses of the people needed a religion to believe in or else society would descend into chaos (such as the chaos of the French revolution).

His proposal was for science to essentially replace religion, that is, to assume the temporal and moral power of the Catholic Church. Often, this is phrased as a call for a "church of science" to supplant the vacuum left by the Catholic Church, and people's faith in scienctific principles to replace faith in God*. He called for scientists to become the new priests, and educate the people in the wonders of science. He put forth Isaac Newton as a sort of "pope" of the new religion, and gravity as a substitute for God. This may seem a bit bizarre to us today, but Newton's uncovering of a mysterious, omnipresent, invisible "force" that kept heavenly bodies in their place and caused apples to fall to the ground, and it's illustration and prediction by the use of maths, seemed as remarkable to people of the late eighteenth century as the idea of an invisible, unseen, all-powerful God was to medieval people. It was then thought that gravity would be the unifying force to unite all the sciences until subsequent discoveries refined that view.  Long before Star Wars, Saint-Simon proposed a belief in "the force" with Newton as Obi-Wan Kenobi.
Saint-Simon argued in the Introduction to the Scientific Studies of the Nineteenth Century that religion should be used as a political tool and that, rather than educating the masses in his physicism, they should be encouraged to continue to believe in God. This, he felt, was the only way to ensure social stability. Like many other writers and thinkers of this period Saint-Simon was fearful of a repeat of the horrors of the Revolution. Thus the educated elite (who would run the rational society of the future) would keep their adoption of physicism a secret, pretending in public to believe in the old religion.

And just as people's belief in scientific principles would replace those of religion, those same scientific principles would provide illuminate the new social organization that would rise from the ashes of medieval feudalism. Saint-Simon believed science would uncover the "laws" of society as assuredly as physics had uncovered the "laws" of the physical universe. Once those laws were uncovered, it was thought, society could be run as rationally as a clockwork machine, with none of the messiness and chaos of the feudal system or the Terror. But from where would these scientific principles emerge?

The same year as the American colonies had proclaimed their independence and James Watt had perfected his steam engine, a Scottish philosopher named Adam Smith published an enormous volume describing the new field of "political economy": An Inquiry into the Nature and Causes of the Wealth of Nations. Smith described the changing nature of the rapidly expanding trade-based mercantilist economy, and the new modes of production such as the division of labor. He asserted that people working in their own self-interest managed to somehow make overall society function and average people better off over time (with many qualifications to that concept that have been subsequently ignored).

Later "worldy philosophers" and "social scientists" expanded on Smiths ideas, and even applied mathematical principles to these concepts, much as Newton had done with the physical world, uncovering things like the "laws" of supply and demand. It soon appeared that all of these "rules" of social organization would be uncovered and understood. This is exactly what Saint-Simon was looking for. He fell in with the French industrialists and businessmen who were inventing the new economy in France, in particular Jean-Baptiste Say. It increasingly began to look like business and productivity would provide the long sought for organizing principles to replace the dying feudal order and the Catholic Church. Saint-Simon 's writings lumped scientific discovery and business enterprise together as "industrialism," and called for industrialism to provide the overriding organizing principles of society, with "industrialists" replacing the aristocracy the new ruling class based on merit and social value alone:
Saint-Simon became increasingly influenced by Jean-Baptiste Say, one of the Idéologues. Say’s writing highlighted the increasing importance of industry, reflecting the shift away from the centrality of agriculture that was taking place in Western Europe. Say used the term “industry” in a much more general way than we tend to today, referring to many types of productive work, including scientific endeavour, scholarly work and business. He emphasised the value of labour, pointing out, like the great political economist Adam Smith, that it was labour that generated wealth. Thus he maintained that it was not government but economics that was the dominant force in modern society. Say believed that social stability would be re-established through industrialisation. Since more and more people would play a productive part in economics there would be greater co-operation and improved social consensus. Thus political economy would be the true science of society.

Saint-Simon’s To all Englishmen and Frenchmen who are passionate about the public good (1815) shows clearly the influence of Say, echoing many of his ideas. In it, Saint-Simon suggested creating a Baconian Society which would play a key role in unifying Europe. This society would be grounded in the scientific method, using observation as its main tool in deciding how society should move forwards. It would provide a historical understanding of the march of progress over the last 400 years. Emphasising the importance of industry, Saint-Simon picked up on Say’s definition of industriel as including business, science and intellectual endeavour, defining society as the “mass and union of men devoted to useful works.”

In his usual astute manner Saint-Simon decided to capitalise on his new found enthusiasm for business and industry by producing a new journal called l’Industrie (Industry), which would be backed by industrialists, bankers and the like. l’Industrie began publication in 1816.

In May 1817, Saint-Simon set out in l’Industrie a declaration of principles which emphasised the need for freedom from government interference for producers and consumers in the new industrial society. The primary role of government, he argued, should be to facilitate the freedom to produce. This meant limiting the influence of the nobility, church and other non-productive members of society. Political writers would assume political leadership under this new system of organisation as they were the people best placed to improve the common lot. A clear connection was made between literary and scientific industry and that of commerce and manufacturing. In Letters from Henri Saint-Simon to an American in the same volume of l’Industrie, Saint-Simon made explicit his new found certainty that political economy would provide the foundation for a positive science of politics. Based on the notion of industry laid out in the declaration of principles, the “science of production” would generate the knowledge necessary to reorganise society rationally, securing a better social system for the future.
In other words, business is the ordering principle of society, and businessmen its natural rulers. Government only exists to facilitate this "natural" working order which has been illuminated by the "laws" of economics, which are as fundamental as the laws of gravity. Interfering with these laws could only cause regression to the more primitive forms of social order.

While Saint-Simon's ideas went much beyond this (he is considered to be the forerunner of both socialism and technocracy, and his apprentice, Auguste Comte is often credited with the invention of sociology), it is the above principles which became the guiding assumptions of modern economic theory. In the subsequent years, "economics" assumed more and more social importance, considering that the first person in history to be identified as an "economist", Thomas Malthus, lived only two hundred years ago (Adam Smith was primarily a moral philosopher). Now economics is a major course of study, and there are hundreds of thousands of them, directing our governments, managing our industries, running our banks, financing our businesses, all using the alleged "science" of money flows and interest rates and the "laws" of economics to manage society. Saint-Simon's ideas of a technocracy administering society according to basic economic laws undergirds the economic world view described earlier. Thus economics as the replacement for religion is not so farfetched at all. In fact, it follows from history.

A couple side notes. Once of the more influential philosophers preceding Saint-Simon was the Marquis de Condorcet. Condorcet was a brilliant mathematician, and once of the early interpreters of Newton's calculus. He was an advisor to Turgot, the minister of King Louis XVI, who had tried to liberalize the French economy from it's static administration (for example, he wished for grain to be traded on open exchange rather than distributed by the state as a way to prevent shortages and famine)**. Condorcet's ideas revolved around the idea of the government using the new scientific discoveries to improve the well-being of citizens and facilitate trade, an idea so obvious to us today that we hardly give it a second thought. He felt that government should maintain bureaus of scientists to advise kings in the best way to govern. In this, he was a successor to Francis Bacon's ideas and a forerunner to the technocracy movement. He even invented a weighted method of elections, the Condorcet method, to overcome the limitations of strict majority (yes, we knew there were problems and solutions for this two hundred years ago already).

Condorcet, unlike Saint-Simon, did not survive the French Revolution. While on the run and in prison, though, he wrote an influential pamphlet called Sketch for an Historical Picture of the Progress of the Human Mind. This was one of the first true codifications of the Enlightenment Idea of Progress - that scientific discovery would led to better and better lives for all, and the human society was on a long slow read to perfection, and scientific discovery would eventually allow a perfect society to from and the lot of human being would continue to improve forever, once all the kinks were worked out. He described all of human history as a series of ten epochs, with society progressing through each epoch at different rates. Post-revolutionary France was in the ninth epoch, with the tenth being the final state where science would bring about the ideal social state:
While it is clearly related to much that had already been written about the rights of man, and discarding the superstition and authority of the past, this was a very different type of work. Through an historical study of the development of human thought, Condorcet hoped to point the way towards future improvement of the human condition. His history consists of nine “grand epochs” of the past, and a tenth epoch in which he advances “some conjectures upon the future destiny of mankind.” However, while his description certainly has time dependence running it, with a corresponding advance in human understanding and material well being, Condorcet is clear that progress is uneven. This is not a naïve view of a continual improvement in the human conditions – not everyone benefits from advances that are made; knowledge and wealth are not always shared; and the states described in each epoch actually frequently run alongside each other. He is explicit in pointing out that there are even people who still live in states corresponding to the first and second epochs. However, part of the point of recognising the progress that has already been made is to point to a trajectory towards a better future state.

Condorcet's ideas of progress were central to the new economic ideas floating around at the time, so central, in fact, that they are taken for granted.  Like other tenets of faith, it is simply assumed to such an extent that people don't even think about it much less question it.

And a final note- Jean-Baptiste Say, mentioned above, is the founder of Say's Law, another tenet of modern economic faith. Say argued that since the production of goods generated income, that income would seek to buy more goods. So the income a businessman makes and pays to his employees would have to go somewhere, and that somewhere would be in the purchase of more goods, causing more goods to be produced (and hence more wages seeking more goods, etc.). Thus, production of goods necessarily created demand for more goods. Say asserted that human wants were essentially insatiable.***

Say's Law has been hotly debated ever since by economists. It came under scrutiny during the Great Depression, since Say's Law dismisses the idea that there would ever be a glut of goods, or that peoples' desires would ever be satisfied.  It also dismissed the idea that workers would be paid too little to purchase all the goods they produced (a necessary tenet of some economic theories such as Marxism). During the Depression, it looked like overproduction and efficiency set the economy off its wheels. There were plentiful supplies of everything, but no demand. Say's Law was summed up critically by John Maynard Keynes as "supply creates its own demand."

Yet Say's law is still treated as an article of faith, even if it is not explicit. It is an essential feature of "supply-side" economics; the idea that if you give businesses every incentive to produce more and more (low taxes, minimal wages, etc.), that this increased production will bring about prosperity for all. Say's Law argues that a "general glut" is impossible. It also assumes that there is no point of satiety, and there will never be too much stuff for people to buy. It assumes that there are no monopolies that can control markets. It assumes that there are no negative effects from production such as resource depletion and pollution. It is the main justifier for low taxes on the wealthy and businesses, even if it is not stated outright.

*Alain de Botton has called for a "Church of Atheism," and has called for the creation of a temple to this end.

** It was Turgot, who first officially described the modern Idea of Progress, according to Wikipedia. He also predicted a lot of Adam Smith in his descriptions of the European economy.

***It's also used to justify unlimited immigration since more immigrants = bigger economy = more jobs.  This is a good example to show how these "laws" actually are used to justify patent absurdities.


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  2. Wow - Saint Simon and Condorcet? You're not just an architect, you've done the reading of a graduate student in social thought.

    I think both Saint Simon and Condorcet were well-meaning, but like most of those who see salvation in determinism, techicism, and scientism, they way over-played their hand. And their descendants are still doing so. They eliminated spirituality, imagination, instinct, and man's essential nature as a being who lives caught between nature, nurture, society and his own inventions (both the arts and technology).

    Their ideas are incredibly attractive for those who are utopian, and repulsive to those who reject the idea that reason and logic can describe the world completely, and should be used to try to control the world.

    Their experiments lead to disaster. Both Marxism and Capitalism are equally destructive. One is out of the running, so I guess it is capitalism that will destroy everyone's ability to live a human life, and perhaps make human life itself impossible on a planet with diminished resources and carrying capacity.

  3. I generally don't go for ad hominum attacks, but Alain de Botton is a real... annoying pseudo-intellectual.

    Another way of looking at the technocrats and their hyper-rationalist predecessors, is that their thought inevitably leads to totalitarian centralism. They want to eliminate all barriers between the individual and the state or the Market. Thus, the individual will be left naked and therefore available to be formed by the technocratic designs.

    Romantics generally see the beauty of a variety of personality types, lifeways, cultures, and outlooks, whereas to the technocratic rationalist, it is possible to figure out the perfect system. The main obstacle then becomes how to squeeze everyone their their sausage grinder.

  4. Graduate reading without the sheepskin = I truly am an idiot.

    Anyway, I studied both of those as part of an (aborted) book I was working on about the Technocracy movement. While technocracy today usually means governing by accounting principles, the real technocracy movement of the 1930's anticipated a lot of the issues we are now facing including unemployment caused by rising productivity and automation. They also talked a lot about how production and the for-profit system were incompatible, since engineers want to crank out the maximum amount of goods at the highest quality, whereas businessmen want to maximize profits by limiting supply and making shoddy goods that break easily.

    The technocrats wanted scientists and technical experts in various fields to make real decisions instead of a political class with no particular skill in anything except for self-promotion and crowd manipulation. They advocated a rational response to problems instead of opinionated bickering. I thnk there is something to be said for this. See my earlier post 'a defense of rational politics.'

    They were also some of the first to discuss resource scarcity. One of the more prominent people in the movement was none other than M. King Hubbert. Hubbert, in his testimony before Congress, summed up the Technocrats' opinion of our economic system as "a collection of medieval folkways." That's the best description I've ever heard.

    The Zeitgeist Movement in many ways looks like a modern update of the Technocracy Movement. Like them, I think they are far too utopianist for my taste. I'm all for incremental improvment. "Big picture" changes to society generally have a poor track record.

    Regarding your definition of technocrats versus Romantics, I'm always reminded of the debates between Robert Moses and Jane Jacobs. There is a lot to be said about the role architecture played in all this. These two images of Paris, sum up the differences in world view:
    Le Corbusier's Plan Voisin:

    Modern Paris:


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