Beyond the Economic Revolution (ROBERT L. HEILBRONER)

Beyond the Economic Revolution (ROBERT L. HEILBRONER)

The Economic Revolution was the most important revolution, from the point of view of shaping modern society, that ever took place— fundamentally more disturbing by far than the French, American, or even the Russian Revolutions. To appreciate its magnitude, to understand the wrenching which it gave society, we must immerse ourselves in that earlier and long-forgotten world from which our own society finally sprang. Only then will it be clear why the economists had so long to wait.

First stop: France. The year, 1305.

It is a fair we visit. The traveling merchants have arrived that morning with their armed guard, have set up their gaily striped tents, and are trading among themselves and with the local population. A variety of exotic goods is for sale: silks and taffetas, spices and perfumes, hides and furs. Some have been transported from the Levant, some from Scandinavia, some from only a few hundred miles away. Along with the common people, local lords and ladies frequent the stalls, eager to relieve the tedium of their boring, draughty, manorial lives; along with the strange goods from Araby they are eagerly acquiring new words from that in- credibly distant land: divan, syrup, tariff, artichoke, spinach, jar.

But inside the tents we meet with a strange sight. Books of business, open on the table, are sometimes no more than note- books of transactions; a sample extract from one merchant reads: “Owed ten gulden by a man since Whitsuntide. I forgot his name.” Calculations are made largely in Roman numerals and sums are often wrong; long division is reckoned as something of a mystery and the use of zero is not clearly understood. And for all the gaudiness of the display and the excitement of the people, the fair is a small thing. The total amount of goods which comes into France in a year over the Saint Gothard pass (on the first suspension bridge in history) would not fill a modern freight train; the total amount of merchandise carried in the great Venetian fleet would not fill one modern steel freighter.

Next stop: Germany. The year, 1550 odd.

Andreas Ryff, a merchant, bearded and fur-coated, is coming back to his home in Baden; he writes in a letter to his wife that he has visited thirty markets and is troubled with saddle-burn. He is even more troubled by the nuisances of the times; as he travels he is stopped approximately once every six miles to pay a customs toll; between Basle and Cologne he pays thirty-one levies.

And that is not all. Each community he visits has its own money, its own rules and regulations, its own law and order. In the area around Baden alone there are 112 different measures of length, 92 different square measures, 65 different dry measures, 163 different measures for cereals and 123 for liquids, 63 special measures for liquor, and 80 different pound weights.

We move on: we are in Boston in the year 1639.

A trial is in progress; one Robert Keayne, “an ancient professor of the gospel, a man of eminent parts, wealthy and having but one child, and having come over for conscience’ sake and for the advancement of the gospel,” is charged with a heinous crime: he has made over sixpence profit on the shilling, an outrageous gain. The court is debating whether to excommunicate him for his sin, but in view of his spotless past it finally relents and dismisses him with a fine of two hundred pounds. But poor Mr. Keayne is so upset that before the elders of the Church he does “with tears acknowledge his covetous and corrupt heart.” The minister of Boston cannot resist this golden opportunity to profit from the living example of a wayward sinner, and he uses the example of Keayne’s avarice to thunder forth in his Sunday sermon on some false principles of trade. Among them are these:

I. That a man might sell as dear as he can, and buy as cheap as he can.

II. If a man lose by casualty of sea, etc., in some of his commodities, he may raise the price of the rest.

III. That he may sell as he bought, though he paid too dear …

All false, false, false, cries the minister; to seek riches for riches’ sake is to fall into the sin of avarice.

We turn back to England and France.

In England a great trading organization, The Merchant Adventurers Company, has drawn up its articles of incorporation; among them are these rules for the participating merchants: no indecent language, no quarrels among the brethren, no card playing, no keeping of hunting dogs. No one is to carry unsightly bundles in the streets. This is indeed an odd business firm; it sounds more nearly like a fraternal lodge.

In France there has been entirely too much initiative displayed of late by the weaving industry, and a règlement has been promulgated by Colbert in 1666 to get away from this dangerous and disruptive tendency. Henceforth the fabrics of Dijon and Selangey are to contain 1,408 threads including selvages, neither more nor less. At Auxerre, Avallon, and two other manufacturing towns, the threads are to number 1,376; at Châtillon, 1,216. Any cloth found to be objectionable is to be pilloried. If it is found three times to be objectionable, the merchant is to be pilloried instead.

There is something common to all these scattered fragments of bygone worlds. It is this: first, the idea of the propriety (not to say the necessity) of a system organized on the basis of personal gain has not yet taken root. Second, a separate, self-contained economic world has not yet lifted itself from its social context. The world of practical affairs is inextricably mixed up with the world of political, social, and religious life. Until the two worlds separate, there will be nothing that resembles the tempo and the feeling of modern life. And for the two to separate, a long and bitter struggle must take place.

It may strike us as odd that the idea of gain is a relatively modern one; we are schooled to believe that man is essentially an acquisitive creature and that left to himself he will behave as any selfrespecting businessman would. The profit motive, we are constantly being told, is as old as man himself.

But it is not. The profit motive as we know it is only as old as “modern man.” Even today the notion of gain for gain’s sake is foreign to a large portion of the world’s population, and it has been conspicuous by its absence over most of recorded history. Sir William Petty, an astonishing seventeenth-century character (who was in his lifetime cabin boy, hawker, clothier, physician, professor of music, and founder of a school named Political Arithmetick), claimed that when wages were good, labor was “scarce to be had at all, so licentious are they who labor only to eat, or rather to drink.” And Sir William was not merely venting the bourgeois prejudices of his day. He was observing a fact that can still be remarked among the unindustrialized peoples of the world: a raw working force, unused to wagework, uncomfortable in factory life, unschooled to the idea of an everrising standard of living, will not work harder if wages rise; it will simply take more time off. The idea of gain, the idea that each working person not only may, but should, constantly strive to better his or her material lot, is an idea that was quite foreign to the great lower and middle strata of Egyptian, Greek, Roman, and medieval cultures, only scattered throughout Renaissance and Reformation times; and largely absent in the majority of Eastern civilizations. As a ubiquitous characteristic of society, it is as modern an invention as printing.

Not only is the idea of gain by no means as universal as we sometimes suppose, but the social sanction of gain is an even more modern and restricted development. In the Middle Ages the Church taught that no Christian ought to be a merchant, and behind that teaching lay the thought that merchants were a disturbing yeast in the leaven of society. In Shakespeare’s time the object of life for the ordinary citizen, for everybody, in fact, except the gentility, was not to advance his station in life, but to maintain it. Even to our Pilgrim forefathers, the idea that gain might be a tolerable—even a useful —goal in life would have appeared as nothing short of a doctrine of the devil.

Wealth, of course, there has always been, and covetousness is at least as old as the Biblical tales. But there is a vast deal of difference between the envy inspired by the wealth of a few mighty personages and a general struggle for wealth diffused throughout society. Merchant adventurers have existed as far back as the Phoenician sailors, and can be seen all through history, in the speculators of Rome, the trading Venetians, the Hanseatic League, and the great Portuguese and Spanish voyagers who sought a route to the Indies and to their personal fortunes. But the adventures of a few are a far different thing from an entire society moved by the venture spirit.

Take, for example, the extraordinary family of the Fuggers, the great German bankers of the sixteenth century. At their height, the Fuggers owned gold and silver mines, trade concessions, and even the right to coin their own money; their credit was far greater than the wealth of the kings and emperors whose wars (and household expenses) they financed. But when old Anton Fugger died, his eldest nephew, Hans Jacob, refused to take over the banking empire on the ground that the business of the city and his own affairs gave him too much to do; Hans Jacob’s brother, George, said he would rather live in peace; a third nephew, Christopher, was equally uninterested. None of the potential heirs to a kingdom of wealth apparently thought it was worth the bother.

Apart from kings (those that were solvent) and a scattering of families like the Fuggers, the early capitalists were not the pillars of society, but often its outcasts and déracinés. Here and there an enterprising lad like Saint Godric of Finchale would start as a beachcomber, gather enough wares from the wrecks of ships to become a merchant, and, after making his fortune, retire in sanctity as a hermit. But such men were few. As long as the paramount idea was that life on earth was only a trying preamble to Life Eternal, the business spirit neither was encouraged nor found spontaneous nourishment. Kings wanted treasure, and for that they fought wars; the nobility wanted land, and since no self-respecting nobleman would willingly sell his ancestral estates, that entailed conquest, too. But most people—serfs, village craftsmen, even the masters of the manufacturing guilds—wanted to be left alone to live as their fathers had lived and as their sons would live in turn.

The absence of the idea of gain as a normal guide for daily life—in fact the positive disrepute in which the idea was held by the Church—constituted one enormous difference between the strange world of the tenth to sixteenth centuries and the world that began, a century or two before Adam Smith, to resemble our own. But there was an even more fundamental difference. The idea of “making a living” had not yet come into being. Economic life and social life were one and the same thing. Work was not yet a means to an end—the end being money and the things it buys. Work was an end in itself, encompassing, of course, money and commodities, but engaged in as a part of a tradition, as a natural way of life. In a word, the great social invention of “the market” had not yet been made.




The Worldly Philosophers

Robert L. Heilbroner



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  • Wisdom is avoiding all thoughts that weaken you .

    lecturesbureau: "Wisdom is avoiding all thoughts
that weaken you ."
  • Man's main task in life is to give birth to himself , to become what he potentially is .

    lecturesbureau: "Man's main task in life
is to give birth to himself ,
to become what he potentially is ."
  • Open your eyes , look within . Are you satisfied with the life you're living ?

    lecturesbureau: "Open your eyes , look within .
Are you satisfied with the life you're living ?"
  • Gratitude is the sign of noble souls .

    lecturesbureau: "Gratitude is the sign of noble souls ."
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    lecturesbureau: "A book read by a thousand different people
is a thousand different books ."
  • What is beautiful is moral .

    lecturesbureau: "What is beautiful is moral ."
  • The beauty doesn't make happy the owner , but the one who can love and admire her .

    lecturesbureau: "The beauty doesn't make happy the owner ,
but the one who can love and admire her ."
  • If you see a friend without a smile , give him one of yours .

    lecturesbureau: "If you see a friend without a smile ,
give him one of yours ."
  • When the mind is pure , joy follows like a shadow that never leaves .

    lecturesbureau: "When the mind is pure ,
joy follows like a shadow that never leaves ."