> Hi Ed, > > I too much enjoyed your posting. > > The difference between us rather reminds me of the long (and good-natured) > correspondence between David Ricardo and Thomas Malthus. Ricardo looked for > basic principles whereas Malthus looked for solutions to contemporary > problems. As Ricardo wrote to Malthus: > > "You have always in your mind the immediate and temporary effects of > particular changes, whereas as I put these . . . aside and fix my whole > attention on the permanent state of things that will result . . ." > > You have been a professional economist all your life, and no doubt you gave > eminently sensible advice to your masters when faced with particular > problems. On the other hand, I was trained as a scientist as a young man > and I cannot get out of the habit of looking for underlying principles, > murky though they often seem to be in this complex subject.
My problem, if it is a problem, is some doubt that there are basic principles that can be applied to human behaviour. Or, to put it another way, things that we call basic principles must derive from, and apply to a particular set of circumstances. Ricardo and Malthus lived in a world in which land and capital were scarce, privatly owned and the key to material progress. Population growth and movement from country to city were dominant features of their world. I've worked with people, Indians living in northern Canada, whose circumstances, perspectives, and hence principles, are very different. Out of their traditions, they cannot understand how anyone can "own" the land or how the land can be "scarce". That simply does not make sense to them (or at least it didn't until quite recently). Capital to them are the skills they have or the tools they can make. Historically, their populations grew only very slowly, if at all. "Movement" meant travelling from their winter lodging places to their summer hunting and fishing grounds. Their lives were not grounded in production, consumption and exchange (though they did these things) but in what they call "the calandar of the seasons". Seasonal change, quite extreme where they lived, determined what they could do and where they had to go to do it. All of that still informs their culture and the way they tend to size up problems, but their lives have changed a lot during the past few decades, so much so that they too have had to buy into the Ricardian/Malthusian world. But my point remains. Had we never "discovered" them, they would still be coping within their own circumstances and deriving their principles from those circumstances. > > I don't know how much of a Keynesian you are but Keynes wrote: > > "If only Malthus, instead of Ricardo, had been the parent stem from which > 19th century economics proceeded, what a much wiser and richer place the > world would be today!" > > After reading Hayek's "Road to Serfdom", Keynes changed his views later, so > perhaps I could encourage you to dig deeper and become more Ricardian in > your approach. Nevertheless, if spontaneous conversion is too much to hope > for at this stage I always read your weighty postings with respect. I would agree that a conversion would be pretty difficult. I simply don't have the time and perhaps not even the interest. I had some exposure to Hayek when I was a student, but my professors, perhaps wrongly, tended to dismiss him as being too far to right. > (Incidentally, it was only a few doors away from my house here in Bath that > Ricardo read economics for the first time [Adam Smith's "Wealth of > Naiotns"]. He was taking a short break from his stock exchange activities > in London and was already a millionaire. Instead of visiting the gaming > tables of Bath [he was much too intelligent for that], he decided to write > a book instead that would be more comprehensive than Smith's. I often > wonder whether he went round the poor working quarters of Bath where, > according to Carlyle, they couldn't even afford to light a fire in their > hearths, and had to hang blankets from the ceilings to keep their body-heat > inside their rooms. Also, as a country landowner, Ricardo was dominated by > questions of tariffs against corn imports [and, to his great credit, came > out strongly against his own class on this matter]. I sometimes speculate > that if Ricardo had travelled from here to Bristol and then up the River > Severn to Ironbridge and the industrial centres of England, that his > "Principles . . ." would have been an even greater book.) It would probably help many of us to understand the world better if we occasionally ventured into the poorer quarters. Personally, I don't think its poverty as such that is the problem, but poverty combined with hopelessness and a lack of control. A few years ago I spent a month in the slums of Sao Paulo among people who, statistically, are among the most wretched on earth. But really, most aren't wretched at all. They've found many different ways of coping both as individuals and collectives. Why? Because the circumstances they were in were better than those they left behind when they moved from the country into the city and they continue to feel that they can still change their circumstances - within limits, of course, but that they think they can do so is an important factor. Ed
