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Busy Carpenter Family by Johann Baptist ReiterExcerpt from Return to Order: From a Frenzied Economy to an Organic Christian Society

Given our organic approach to the present crisis, we will not only insist upon the secondary role of economics in a social order, but we will also maintain that the social and economic orders are inextricably intertwined. Any treatment of the present crisis must address both spheres.

Karl Polanyi notes how prior to modern times, “the motives and circumstances of productive activities were embedded in the general organization of society.”[1] Thus, we deliberately propose an organic society as a part of the solution to an economic problem because we believe that when economic activities take place inside the context of society, it allows the natural restraining influence of human institutions such as custom, morals, family, or community to calm markets and prevent frenetic intemperance. In fact, this organic social order is so important that we do not hesitate to call it the heart and soul of an economy.

Heart and Soul

This conclusion derives from the fact that, as social beings, it is proper that we associate to produce, exchange, and enjoy together those goods deemed helpful to the common good and the perfection of our nature. As such, it is fitting that something of the living and spontaneous aspects of our free and rational nature and our sentiments enter into these transactions. This is what makes economic actions so unpredictable—they depend on the very nuanced dispositions and free actions of men. Economics can never be an exact science like physics, which deals with matter that always moves according to rigidly determined laws of nature.

In economics, unforeseen factors that stem from the heart and soul of men always enter. Economic science can define norms by which it is possible to create wealth with the means at hand, but it cannot determine the end of the human actions that can change the outcome of the decisions to create wealth. An economist might, for example, determine if a factory can be built given the means in a certain place. Yet the same economist cannot determine if it should be built considering all the political, social, and moral factors that might enter into the case. Economists can analyze trends in production and consumption, but they cannot discern the motivation of consumer behavior. They cannot plumb the depths of the human soul; they can only observe the consequences of certain human commercial acts and take limited conclusions. Unlike the laws of the natural sciences, economic laws involve free and rational human beings and are consequently free of determinism.

In vain, modern economists try to minimize or eliminate these unquantifiable factors from their ledger books. It is precisely on these human elements that we will now focus and celebrate.

“A Vast World of Self-Sufficiency”

We must remember that economy in its ancient and even etymological origins was born around the warm hearth of the family home.[2] Aristotle was the first to make the distinction between house-holding on one hand and production for gain on the other.

In pre-modern times, an economy of both sorts was always an accessory absorbed into the social and cultural structures of the day. As sociologist Robert Nisbet affirms, in every successful economy, we find “associations and incentives nourished by the non-economic processes of kinship, religion, and various other forms of social relationships.”[3]

Such non-economic processes make up what French historian Fernand Braudel calls “the vast world of self-sufficiency” that long dominated the West and persists to our day.[4] They are sources of immense material and spiritual wealth that largely go uncompensated, remain unrecorded, or defy quantification. We believe these vast sectors constitute the heart and soul of all economy.

Defining These Areas

These sectors are found everywhere. The first one is the family, which is a dynamic source of uncompensated activity that freely provides its members with shelter, nourishment, education, affection, and healthcare. There is also the Church with Her liturgical, moral, and religious acts that communicate untold spiritual benefits to a community. Her moral code secures the nation. She gratuitously bestows culture, charity, and learning upon Her children and society as a whole.

We can refer to local, cultural, or religious associations that generate arts, civic spirit, and works of charity that enrich the community in ways that cannot be quantified. This can also be seen in any kind of organic neighborhood or ethnic community where inhabitants receive the great benefits of solidarity and a distinctive local identity. Common local transactions, barter, or acts of neighborliness are clearly valuable actions that strengthen economy. All of these institutions and activities have an indirect impact upon the formal economy and truly nourish and sustain it. This is especially true in agrarian society where the land, besides freely giving its fruits and creating abundant wealth, also creates a sense of self-sufficiency and a strong attachment to property.

Focus on Property

Before becoming a modern commodity, private property possessed a strong intangible value. Real property, especially land, was a point of anchorage or sanctuary from which a family might develop. Wherever a strong sense of private property exists, a strong family pervades. An intimate link between owner and owned becomes evident when, for example, a house or property becomes identified with a family over years or generations. In such cases, land and property become embedded in social relationships. They are not mere commodities but become part of the social and political organization itself, conferring the intangible qualities of honor, authority, and status upon the owner.

Social Capital

So important are these intangible relationships that there is a growing field of sociological studies that focuses on the value they give to economy. Sociologists claim that intense networks of reciprocal human relationships produce what they call social capital.

David Halpern defines social capital as a social network governed by shared norms and values and maintained by sanctions.[5] It is a social fabric that serves as a kind of capital since it creates conditions for trust. Although unquantifiable, it enriches and lubricates social, civic, and economic life, giving it undeniable value. It is also a source of immense security embracing that which is familiar while investigating that which is threatening.

When this trust is gone—and we join Halpern in affirming that it is disappearing—the foundation for commerce and economy is threatened, and the general well-being of society is lost.

Source of Human Warmth and Stability

All of these sectors provide the essential human element that is so important to economy and makes it so nuanced and unpredictable. They provide those essential braking mechanisms inside economy that prevent the rule of frenetic intemperance.

Such spheres are where the drama and poetry of life reside. Like economy, literature was born next to the warm hearth of the family household and has no place in the accountant’s ledger. If today this informal economic sphere holds such great attraction for us, it is because we long for that human warmth found in these social institutions and not in our super-rationalized mechanized world and its economy.

These considerations are not nostalgic musings about the past. Rather, all these dynamic elements—church, community, family, personalized property—form an invaluable human infrastructure that actually provides the moral capital, psychological health, and stability upon which even our modern economies must be built. Although scarcely registered in modern economic life and threatened on all sides, their contribution to the economy is incalculable, and their demise will prove catastrophic.

Importance of This Sector

Our focus on this vast “invisible” economy in no way denies the need or importance of a formal economy in the life of a nation. We only affirm that these two economies are intertwined; the prosperity of one depends upon the other. Our principal concern should be centered on this vast primary “world of self-sufficiency”.

This is because when these institutions and sectors fail, the nation languishes. This could be seen in the tragic failure of the Soviet experiment, which is patent testimony of a soulless planned economy that deliberately strangled this “invisible” sector and paid the consequences of misery.

If we now wish to return to an economy without frenetic intemperance, a great part of the solution lies in the regeneration of this vast sector that does not appear on the ledger books. It is to this task that we now turn.

In vain do we seek to regenerate an economy if we do not regenerate the family, the community, and so many other institutions that are its heart and soul. Indeed, to what purpose do we prosper if all this withers?

Books on this topic may be found in The Imaginative Conservative Bookstore.

Notes:

  1. Polanyi, The Great Transformation, 73.
  2. Economy. “MF yconomie, fr. ML oeconomia, fr. Gk oikonomia, fr. oikonomos household manager, fr. oikos house + nemein to manage 1. archaic: the management of household or private affairs and esp. expenses.” Webster’s New Collegiate Dictionary, 1981 edition, s.v. “economy.” It should be noted that in Aristotle’s time, the household often referred to an estate and did not exclude some economic surplus production.
  3. Nisbet, Quest for Community, 212-13.
  4. Fernand Braudel, Afterthoughts on Material Civilization and Capitalism, trans. Patricia M. Ranum (Baltimore: Johns Hopkins University Press, 1977), 19.
  5. See David Halpern, Social Capital (Cambridge: Polity Press, 2005), 10.
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2 replies to this post
  1. Though he did this a bit differently than what this article describes, Chilean economist, Manfred Max-Neef, stated a similar principle. He believes that economics should be a piece in a larger pie rather than the pie that swallows up the rest of life. Below are links to parts 1 & 2 of a Democracy Now with Max-Neef. Thought that with the above approach, his views might be interesting:

    Part 1 of Interview
    Part 2 of Interview

    Though there are things I disagree with in this article, I was pleasantly surprised. Thank you or the post

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