By John Francis Sase, Ph.D.
Gerard J. Senick, chief editor
Julie G. Sase, copyeditor
William A. Gross, researcher
“Anything that we can destroy,
but are unable to make is,
in a sense, sacred,
and all our ‘explanations’ of it
do not explain anything.”
—E (Ernst) F (Friedrich) Schumacher (1911 – 1977),
German-British statistician and economist
In this month’s column, we break from our ongoing series “Sufficient Affluence/Sustainable Economy” to introduce our readers to the field of Humanistic Economics. The nuances of Economics may befuddle even the brightest of minds. However, by creating a hybrid of the Social Science of Economics with the various fields of Humanities, we may refer to the emerging product as Humanistic Economics—an approach to the puzzle of life, grounded in common sense and in the humane and empathetic treatment of our fellow beings. When economists bring their talents to the legal community, we bring more than a bag of numbers, equations, and charts to the table. We hope that we travel with, and share, some deeper understanding of human behavior. Mostly, we find the Humanistic Economics in the narrative while the mathematics appears in the spreadsheets.
Understanding Humanistic Economics has become critical for all facets of the Law, which consider outcomes for human beings. Though many humanistic elements exist in areas of legal practice, these elements appear most pronounced in matters of Employment Law, Personal Injury, and Wrongful Death. Economic Determination, put forth as numbers and calculations, demands reflection on the nature and behavior of the human beings involved in a case.
In order to help us to summarize and to build the integral thought process that is Humanistic Economics, we turn to the presentations made in unity by economist Mark A. Lutz and psychologist Kenneth Lux some forty years ago. Given the current state of the world, it feels appropriate to revisit this older, well-established approach for understanding and solving economic problems. We may apply this approach on an individual basis, such as to a plaintiff or to a defendant in a court case, or on a global basis, to understand and perhaps to resolve larger issues.
To move toward these goals, Lutz and Lux provide a well-grounded evolution of Humanistic Economics from the 18th through the 20th Centuries in their books “The Challenge of Humanistic Economics” (Benjamin-Cummings Publishing Co., 1979) and “Humanistic Economics: The New Challenge” (Rowman & Littlefield, 1988). We will use their synthesis, mixed with a plethora of other sources, as our foundation and framework.
Modern Evolution of the Concept
Lutz and Lux present us with a grand summary of the evolution of the humanitarian legacy that is embedded within the traditions of both Economics and the Law. We will use this map to find our way in 2021 and beyond, relying upon the tracings of these two authors to comprehend the development and emergent purpose of this legacy. In addition, we will rely upon the combined thoughts of eight notable polymaths and their key publications that address the matters at hand. These critical thinkers include Adam Smith (1759 and 1776), Count Sismonde de Sismondi (1819), Thomas Carlyle (1841), and John Ruskin (latter 19th Century). At this point, the path splits off and follows the thoughts of Humanistic Economics through John Atkinson Hobson (early 20th Century), Mahatma Gandhi (1920s), and Richard Henry Tawney (1920 and 1931). In order to establish the foundation for moving forward in our present age, the core concepts filter down through the writings of E.F. Schumacher (1973), who contributed our opening quote.
We will provide our readers with an overview of Humanistic Economics as developed through the writings of the authors cited above and will leave our audience with the relevant original citations, making it easier for those who choose to explore these thoughts to find available reprints of the original texts.
Adam Smith
Many of us, exposed even to small amounts of Economics, have heard of Adam Smith (1723 - 1790), the Scottish economist, moral philosopher, and pioneer of Political Economy, and his highly noted book “The Wealth of Nations,” (aka “An Inquiry into the Nature and Causes of the Wealth of Nations,” W. Strahan and T. Cadell, London, 1776). However, Smith previously wrote The Theory of Moral Sentiments (Alexander Kincaid and J. Bell, Edinburgh, 1759), a book in which he sets the humanistic foundation for “The Wealth of Nations.” This title, which states that our moral ideas and actions constitute the best of our nature as social beings, posits that this forms a better guide to moral action than reason. Smith provides us with the philosophical underpinnings to understand the practical ideas presented in his more famous book of 1776. “The Wealth of Nations,” which describes the elements that build national wealth, remains the fundamental work in Classical Economics. By focusing upon the economics at the beginning of the Industrial Revolution, Smith address topics such as free markets, the division of labor, and productivity. He concludes that the division of labor, accompanied by improvements in the tools used in manufacturing, has led to an increase in the production of goods traded among countries in a free-market setting. Smith emerged as a key figure during the Scottish Enlightenment. Now he has become known as “The Father of Economics” or “The Father of Capitalism” and has attained the status of the modern “Father of Humanistic Economics” for many who have studied his works in this light.
Count Sismonde de Sismondi
Smith continued to influence other thinkers throughout his life as well as after his death. Through a representative humanitarian protest against the dominant orthodoxy of his time, the French/Swiss historian and political economist Sismonde de Sismondi (1773 - 1842) follows the lines of thought presented earlier by Smith. In his liberal critique of laissez-faire economics, “Nouveaux Principes d’Economie Politique” (“New Principles of Political Economy”) (1819), Sismondi insists that economic science addresses the increase of wealth too much and the use of wealth for producing happiness too little. Sismondi arose as one of the pioneering advocates of Unemployment Insurance, Sickness Benefits, a Progressive Tax, Regulation of Working Hours, and a Pension Scheme. Furthermore, he coined the term proletariat in order to refer to the new laboring class created under Capitalism.
Thomas Carlyle
Many of us know of Thomas Carlyle (1795-1881) as a Scottish historian, satirical writer, essayist, translator, philosopher, mathematician, and teacher. He began his career by translating the humanistic economic work of Sismondi into English. Forever after, Carlyle remained highly critical of political economy, which he contemptuously labeled “the dismal science,” while taking the pro-slavery side in an ongoing debate with English philosopher, political economist, and Member of Parliament John Stuart Mill in Frazier’s Magazine for Town and Country.
In his book “On Heroes, Hero-Worship, and the Heroic in History” (Chapman and Hall, London, 1840), Carlyle argues that the actions of what he calls the “Great Man” play a key role in history while claiming that “the history of the world is but the biography of great men.” During the 19th Century, the “Great Man” emerged as the entrepreneur, bringing capital together in order to reach a societal goal. The large iron foundries, steel mills, railroads, and other industrial combines come to fruition through the efforts of the “Great Men.” Carlyle provided the man of straw for reformers to attack.
John Ruskin
As a contemporary of Carlyle, his student Ruskin (1819 -1900), an English philosopher, writer, and art critic, lived during the latter Victorian Era and wrote on the varied subjects of architecture, botany, education, geology, literature, myth, ornithology, and political economy. Ruskin directly and systematically addressed this latter subject and its inner logic. However, his thoughts on political economy also appear in a number of his non-economic books, including ones on art and architecture.
In summary, Ruskin believed that individuals have the responsibility to consume wisely and to stimulate a beneficent demand for goods and services. He remained influential throughout the latter half of the 19th Century until the time of the First World War. Though his ideas and works suffered through a period of relative decline, Ruskin’s reputation has improved steadily since the 1960s through the publication of numerous academic studies of his works. Currently, academics recognize Ruskin’s ideas and concerns as anticipating an interest in environmentalism, the Arts and Crafts Movement, and the sustainability of humanistic ventures.
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