A Humane Economy

Rating:
Summary: The Humane Economy: Economics as if the Individual Matters..
Review: Exiled from Hitler's totalitarian regime to neighboring Switzerland, Röpke emerged as the man credited for the Federal Republic of Germany's postwar boom and was influential on the policies of Germany's Economic Minister Ludwig Erhard. Wilhelm Röpke stands apart from most economists in that he thinks on a more humane level rejecting crude utilitarian calculations in favor of sound empirical reasoning. The crux of Röpke's economic thought is that the individual has meaning. The individual is more than a mere hyperatomized cog in the machine. He recognizes that the market is not some abstract ideology (contrary to Novak's concept adulation of 'democratic capitalism.') Moreover, the market does not exist in a vacuum, but within a transcedent moral order. The market economy represents "the economic order proper to a definite social structure and to a definite spiritual and moral setting." He criticizes "the cult of the colossal" and giganticism where individuals "become mere passively activated mass particles or social molecules." Centralism, which Röpke detests, leads to socialism, a colossal state, an impersonal bureaucracy, and a dehumanized society. Röpke's Humane Economy, on the other hand, posits that a decentralized order is the path to freedom, vibrant communities, properity, and overall human happiness.

Röpke notes that the sound economic order of free enterprise "must find its place in a higher order of things which is not ruled by supply and demand, free prices and competition. It must be firmly contained within an all-embracing order of society in which the imperfections and harshness of economic freedom are corrected by law and in which man is not denied conditions of life appropriate to his nature." Röpke poigantly surmised that: "The market economy, and with social and political freedom, can thrive only as part and under the protection of a bourgeois system. This implies the existence of a society in which certain fundamentals are respected and color the whole network of social relationships: individual effort and responsibility, absolute norms and values, independence based on ownership, prudence and daring, calculating and saving, responsibility for planning one's own life, proper coherence with the community, family feeling, a sense of tradition and the succession of generations combined with an open-minded view of the present and the future, proper tension between individual and community, firm moral discipline, respect for the value of money, the courage to grapple on one's own with life and its uncertainties, a sense of the natural order of things, and a firm scale of values." Röpke astutely observes that civil society is awash in problems from cultural fragmentation, urbanization, and gargantuan institutionalism. He recognizes the benefits and limits of the market economy, which he eloquently defends.

This classic economic treatise recently was rereleased from the Intercollegiate Studies Institute. I also recommend Wilhelm Ropke: Swiss Localist, Global Economist by John Zmirak from ISI's Library of Modern Thinkers Series, which is an insightful biography and introduction to the economic, political and social thought of this brilliant man.

Rating:
Summary: Wilhelm Röpke, un economista ante la crisis de la cultura
Review: Guillermo Röpke, que nace casi con el siglo XX, es uno de los representantes más acreditados del verdadero pensamiento económico, reconciliado con la reflexión ética y política. Lejos de él la tajante separación entre la economía y la política instituida por los representantes del neoliberalismo economicista. Röpke, amigo de Alexander Rüstow, cuya obra también conocía en profundidad, constituye en ejemplo superior de la manera de pensar en órdenes concretos ("Ordnungsdenken"). Ello explica, justamente, la importancia del libro cuya traducción al inglés registra el título "A Humane Economy", y cuya traducción al español, mucho más fiel al título alemán, se rotuló "Más allá de la oferta y la demanda". En efecto, ese título resume perfectamente la intención del autor, pues Röpke consideraba que la economía de mercado no lo es todo. En su opinión, esta necesita ser sostenida por un recio entramado de creencias y valores. En este sentido, resulta insólito descubrir la preocupación social de Röpke en una profesión, la de economista, demasiado preocupada por las grandes categorías científicas.

Rating:
Summary: A Truly Extraordinary Book
Review: If you want a bracing look at how society should run, pick up this book. Ropke, a German who resisted Hitler during WWII and was an architect of Germany's post-war economic resurgance, writes beautifully about the value of the market economy, and about the need to undergird this economy with strong social and political institutions.

A chief value of the book is that it was first written back in 1960, and is therefore outside of the current, rather small, debate. Although some of his topics seem a little dated (communism chief among them), the underlying battle is timeless and this book is well-worth the read.

Rating:
Summary: The market is not everything
Review: One of the great errors prevalent in economics is the assumption that an economy is a kind of endogenous entity which can be understood entirely on its own terms, without reference to social, political, and psychological factors. This error is especially prevalent among those ideologues who believe that, while politics affects economics, economics never affects politics. But this is clearly not how things stand in social reality. Politics and economics exist within a complex web of causal interdependence. No attempt to impose through politics a specific brand of economics can ever hope to be successful, since waves of causation from the economic realm will ricochet back into the political realm, thus altering the original economic program.

The political right, especially in its libertarian and pro-market incarnations, has never properly understood this insight into social reality. In their polemic economic tracts, they implicitly assume that "society" or the "government" could choose at any time to adopt any economic principle it liked, regardless of the likely social or political consequences of that principle. Libertarians tend to support any economy policy which they believe will bring about greater freedom and efficiency, ignoring all the while the disastrous consequences the policy might have in the political and social realms. The great merit of Wilhelm Roepke's "Humane Economy" is that he sedulously avoids this error. Roepke is one of the few pro-market who understands that the free market does not exist in vacuo and that the market cannot be defended as a good-in-itself. In the "Humane Economy," Roepke points out that free enterprise depends on sociological, moral, and cultural factors for its maintenance and survival. The "sphere of the market, of competition, of the system where supply and demand move prices and thereby govern production, may be regarded and defended only as part of a wider general order encompassing ethics, law, the natural conditions of life and happiness, the state, politics, and power," writes Roepke. "Individuals who compete on the market and there pursue their own advantage stand all the more in need of the social and moral bonds of community, without which competition degenerates most grievously." Roepke's defense of the market rests firmly on time-tested conservative principles. He dissects the corrosive effects of mass society and social rationalism and warns against those two "slowly spreading cancers of our Western economy," "the irresistible advance of the welfare state and the erosion of the value of money, which is called creeping inflation." There are few books which detail the crisis of modern civilization in the West better than this one; and none which offer a more convincing vision of a genuinely "humane" economy.

Rating:
Summary: The Price of Everything and the Value of Nothing
Review: Russell Kirk tended to take the view of Edmund Burke that the age of Sophists, Economists, and Calculators was upon us and that the unbought graces of life were gone. Kirk found the priests of the dismal science to be a blinkered breed who worshipped the god Efficiency, but from that judgment he excluded Wilhelm Ropke, whose work was aimed at returning economics to the human scale.

Ropke opposed the rise of the National Socialists in his native Germany. When Hitler came to power, Ropke was forced to leave, having lectured against the centralizing economics of that regime. But after the Second World War he returned to play a large role in Germany's postwar recovery, which was based on market solutions. From experience he had no confidence in systems of centralized authority -- socialism, communism, or collectivized decision-making of any kind. Against these he believed in local institutions, such as the small town of his birth, family, church, local community, neighborhood, and what Burke called the little platoons in which we travel.

Further, he had no faith in an abstract capitalism that excluded moral considerations. The essence of A Humane Economy is that the most important facets of life transcend the economic sphere. Ropke builds his argument by looking at the moral foundations and ethical conditions necessary for a market economy to function, and by locating the market economy within necessary limits and spheres of activity. He also examines the destructive effects of mass society: crowded cities, bureaucratic hospitals, ubiquitous industry, egalitarian democracy, the absurd pace and busy-ness of modern life, and the myth of the sovereign people over the individual person. The remaining chapters look at the welfare state, chronic inflation, and the importance of ownership and private property.

The line that Ropke draws is between centrism and decentrism. With centrism comes the gradual erosion of the human element. Just as Ortega y Gassett showed how modernity had excluded man from art, so Ropke is arguing that economics has gradually excluded man from economics. While art had become preoccupied with abstract ideas, economics was being treated as a science, surrounded by theory, charts, and graphs. What economists should have been doing, argues Ropke, is adapting economic policy to man, not trying to adapt man to economics.

Readers should have no trouble recognizing this dehumanization at work in today's world. Contra Ropke, the centralizing impulse is on the rise in both government and the workplace. Books about economics have earned their reputation for dullness, but Ropke transcends the genre. His book is readable and re-readable, with a wider view than the blinkered breed usually gives us. Perhaps in time A Humane Economy will receive a proper hearing.

Rating:
Summary: The Humane Economy: Economics as if the Individual Matters..
Review: ~A Humane Economy~ is economics with conservative sobriety, which rightly recognizes the benefits and limitations of a market economy while eschewing the materialism of libertarianism and Marxism. Exiled from Hitler's totalitarian regime to neighboring Switzerland, Roepke emerged as the man credited for the Federal Republic of Germany's postwar boom and was influential on the policies of Germany's Economic Minister Ludwig Erhard. Wilhelm Roepke stands apart from most economists in that he thinks on a more humane level rejecting crude utilitarian calculations in favor of sound empirical reasoning. The crux of Roepke's economic thought is that the individual has meaning. The individual is more than a mere hyperatomized cog in the machine. He recognizes that the market is not some abstract ideology (contrary to Novak's concept adulation of 'democratic capitalism.') Moreover, the market does not exist in a vacuum, but within a transcedent moral order. The market economy represents "the economic order proper to a definite social structure and to a definite spiritual and moral setting." He criticizes "the cult of the colossal" and giganticism where individuals "become mere passively activated mass particles or social molecules." Centralism, which Roepke detests, leads to socialism, a colossal state, an impersonal bureaucracy, and a dehumanized society. Ropke's Humane Economy, on the other hand, posits that a decentralized order is the path to freedom, vibrant communities, properity, and overall human happiness.

Roepke notes that the sound economic order of free enterprise "must find its place in a higher order of things which is not ruled by supply and demand, free prices and competition. It must be firmly contained within an all-embracing order of society in which the imperfections and harshness of economic freedom are corrected by law and in which man is not denied conditions of life appropriate to his nature." Roepke poigantly surmised that: "The market economy, and with social and political freedom, can thrive only as part and under the protection of a bourgeois system. This implies the existence of a society in which certain fundamentals are respected and color the whole network of social relationships: individual effort and responsibility, absolute norms and values, independence based on ownership, prudence and daring, calculating and saving, responsibility for planning one's own life, proper coherence with the community, family feeling, a sense of tradition and the succession of generations combined with an open-minded view of the present and the future, proper tension between individual and community, firm moral discipline, respect for the value of money, the courage to grapple on one's own with life and its uncertainties, a sense of the natural order of things, and a firm scale of values." Roepke astutely observes that civil society is awash in problems from cultural fragmentation, urbanization, and gargantuan institutionalism. He recognizes the benefits and limits of the market economy, which he eloquently defends.

This classic economic treatise recently was rereleased from the Intercollegiate Studies Institute. I also recommend _Wilhelm Ropke: Swiss Localist, Global Economist_ by John Zmirak from ISI's Library of Modern Thinkers Series, which is an insightful biography and introduction to the economic, political and social thought of this brilliant man.