Yesterday I wrote about the relationship between the natural sciences and politics, which is a moral science. Those reflections set off a chain of reflections on our current economic state, which Warren Buffet, I am told, described as having “fallen off a cliff.”
Economists crunch numbers. They have reduced economics to following statistical trends, making it a mathematical “science,” an attempt to imitate physics by identifying the laws that govern the behavior of money.
On the face of it this approach is either absurd or the formalization of despair: absurd because they have abstracted the “human” out of “human behavior,” and/or despair because they treat humans as though we have no control over what we do.
An irony arises when you treat people that way, because when you do so, you create incentives for them to act that way, so they do.
But to avoid wandering too far from my point, I’ll make it now. The approach the modern economist takes to economics replaces economics with something altogether inferior and not up to the task. Another way to make this point is to say that the modern approach to economics changes the nature of economics.
You can most easily see this shift by looking at the word. Economy comes from two Greek words: oikos, meaning household and nomos, meaning law or custom. Economics, in short, was the study of what sustains the health of the household.
The modern approach disregards the well-being of the household in order to evaluate the movement of money. Micro-economics attends to the particular business and its decisions, but it would be hard to imagine a college econ text describing the roles of family members, for example, in cultivating the well-being of the household.
Our approach to economics is in a destructive symbiotic relationship with the household. It undercuts the household and is itself (that is to say, the “economy” is) undercut by the unhealthy household.
Notice the staggering shift in regard to ends: the healthy household is no longer the focus of this so-called science. It has been replaced by – what? The “Economy”? What is that?
I’m not sure the implications of the point I’m making can be easily grasped. What I’m arguing is that we have structured our entire society and political system on an error of the fifth magnitude. This error penetrates so deeply into our society that it undercuts the soul of every member of our society and the activities of every participant.
And lest you wonder, yes, there were people who saw it coming. Edmund Burke may have been chief among them, but there were others, most of them, perhaps surprisingly, in France, such as Alexis de Tocqueville, Chateaubriand, de Bonald, Frederic le Play, and Rene de la Tour Du Pin.
Let me simplify and relate back to yesterday’s blog about stem cells. In both cases, the nature of the subject has been ignored.
In the case of stem cells, the question of power over human beings was reduced to a question of natural science, the moral, philosophical, and theological sciences being discredited and excluded from the conversation.
In the case of economics, the question of the well-being of the household was replaced by a numerical abstraction mis-named “the economy.” Then economics came to be an almost strictly mathematical study, subject to no higher study.
Yet, when Adam Smith more or less created modern economics, he still called it a “moral science.” In fact, Adam Smith was, as I recall, a professor of moral philosophy. Yet, by framing economics as he did and using the categories he used, the Socialist reaction was almost inevitable. Of course, somebody had to theorize it and there were plenty of revolutionaries at the end of the 18th century who were ready to do so.
But once economics had been reduced to a science of the Enlightenment variety, only sloth would have kept a robust socialistic theory from developing. Because the fatal move had already been made: the household had been removed from consideration – or at least radically minimized for the sake of the factory or business.
The moral science of economics has been reduced to a quasi-natural science based on mathematics. No longer does the “science” honor the nature of that which it studies. To abandon these words and categories to the modernist is to lose the battle before it is engaged and to fail our children, just as our predecessors failed us. Consider, for example, how we have seen a historical shift from the independent yeoman farmer to the most highly dependent consumer. We have reached the point where if we don’t buy useless things our economy will seize up and then people won’t be able to get work selling useless things so they can buy more useless things.
And here’s how it relates to education: we literally undercut people’s ability to think wisely in these areas by the structure of our curriculum. We treat all subjects as though they are the same either in dignity or power. This is not so. First of all, some subjects are beyond the capacity of the high school student to engage in, yet we pretend to teach them by telling them what to think about these subjects – as early as kindergarten.
Economics is a classic example. Sure a high school student can learn your opinions about economics. But he can’t understand economics. It’s a moral science. It takes years and years of actualy living and practice to begin to understand the reality of economics. So by teaching it in high school, we perpetuate the error of the age. In one setting we teach kids the platitudes of the left, in another those of the right.
In neither case do they learn economics. If we would admit that we are simply teaching them our theories, the whole enterprise could be enriched. But in my view, and, I think, in Aristotle’s, Plato’s, St. Augustine’s, St. Basil’s, St. Thomas’s, John Calvin’s, Martin Luther’s, and even Adam Smith’s, we ought to be more humble about what we teach and when.
We should be teaching students the seven arts and the natural sciences so their minds can maintain order. Then, when they are older, economics will be much easier for them to understand and to incorporate into a sound edifice of knowledge rather than simply being poured into the swamp (at best) or cess pool that we call learning these days.
Besides, even modern economics, like every field, has its technical knowledge; it rarely would take more than two years to get that down. Then you need judgment and humanity.
As to our present situation and those trying to get us out, I would much rather have somebody who saw this coming in charge, rather than the people who were so deeply involved in bringing it about. I believe that we are in this situation because the structure and order of our thinking and the categories we use to do it are inadequate to the task of maintaining a healthy economy.
Here is my conclusion: until the household is once more made the central focus of economics, the presumed science of economics will continue to undercut that which is the foundation of every economy – the healthy household. But the less healthy the household is, the more people will call on the government, guided by blind economists, to bale them out of their troubles.
The great enemy of the modern order, therefore, is the household. The household is real actual people enmeshed in reality. What a nuisance to an order rooted in fantasy and unreality.