Provocation #74 Economics and whole systems
For Aristotle eco-nomos, economy, meant estate management. He chose nomos over logos to emphasize the man-made law (nomos) as contrasted with the natural law, logos (the inherent logic of things). The estate was the only unit of production in Athenian society. The estates were basically cattle farms, with of course cattle (from which comes capital, cap, head, head of cattle, and stock. But his economics also dealt with the land, the food the wife, children and slaves, and the local politics of the democratic assemblies. In short, everything that pertained to the estate as the creation and supporter of life.
By the time of Adam Smith a sense of wholeness persisted in the idea of the wealth, not of a class, bit of the nation. He even makes it plural, “nations”, for the whole of humanity. He was sensitive to the plight of the poor and the need for education to overcome the narrowness of division of labor. In the Wealth of Nations he wrote that “Civil government … is in reality instituted for the defense of the rich against the poor.” and He wrote, “The government of an exclusive company of merchants is, perhaps, the worst of all governments for any country whatever.”
[just as] economy in general [is] the art of providing for all the wants of a family, [so the science of political economy] seeks to secure a certain fund of subsistence for all the inhabitants, to obviate every circumstance which may render it precarious; to provide every thing necessary for supplying the wants of the society, and to employ the inhabitants … in such manner as naturally to create reciprocal relations and dependencies between them, so as to supply one another with reciprocal wants.
Nothing like it hardly in today’s economics, even the most progressive does not have a sense for dependencies in riciprical relations.
But from Smith on the tendency has been to narrow the scope of concern. Of course the big deal was the rapid rise of the factory system, industrialization, and the need to understand it. But John Stuart Mill summing developments over 70 years since Smith, wrote,
Political economy ‘does not treat of the whole of man’s nature as modified by the social state, nor of the whole conduct of man in society. It is concerned with him solely as a being who desires o possess wealth, and who is capable of judging of the comparative scarcity of means for obtaining that end. It predicts only such of the phenomena of the social state as take place in consequence of the pursuit of wealth. It makes entire abstraction of every other human passion or motive.’
This narrowing has led to an economics irrelevant to understanding the main narratives of modern society, the society that now closes in on us with climate damage, too much population (desired by commerce that wants cheap labor and more consumers – and more soldiers). We need to break out. Take any AEA paper and look for reference to the impact of the discussed topic on real people. At the most there may be some discussion of a distribution of some variable, but not concrete lives, the impact of the discussed theme on the quality of food, air, art or mood.
Economics would be more interesting and more fun if it looked to understand the whole of society as a production process integrating humans with nature in the production and reproduction (Marx) of lived lives for all of society.