"Small Is
Beautiful - A Study of Economics As If People Mattered" was written by
E.F. Schumacher, first published in 1973. The book used in this review was
reprinted by Harley & Marks Publishers Inc, 1999 in the United States with
the length of xiii + 286 pages, consisting of four parts with 19 chapters,
Epilogue, Notes and Acknowledgements, Biographies of Contributors, Resources
and Index.
E.F. Schumacher was an economist, journalist and an
entrepreneur. He was born in Germany in 1911, and studied economics. He came to
England in 1930 as a Rhodes Scholar to study economics at New College, Oxford;
later taught economics at Colombia University, New York and went back to
Germany to do business. During the regime of Hitler and the Second World War he
stayed in England, and then worked as an economic adviser to the British
Control Commission charged with rebuilding the German economy from 1946 to 1950
and became an economic adviser to the National Coal Board to aid Britain in its
economic recovery, a position that he held for the next twenty years. His death
by heart attack occurred in Switzerland
in 1977, at the time that his idea was close to a breakthrough. He also published
other books, such as “Good Work” and “A Guide for the Perplexed”.[1]
He had an opportunity to stay in Burma, traditionally a
Theravada Buddhist country, as an economic consultant and he then developed
economic theories of what he called 'intermediate technology' and 'Buddhist
economics' to help developing countries or less-developed countries in
their economic development. These are the experiences that became contributing
factors to the writing of this book, Small Is Beautiful.
It is a book written at a time when the world was pursuing
the use of modern large-scale technology to exploit radically natural resources
for the development of economics and for the satisfaction of material needs.
The author, as a predictor of the future, and a person who was mindful of the
sustainable economic development of mankind, called for a life-style of
harmony, simplicity and non-violence to nature. More than thirty years have
gone since this book was first published in 1973; and it is now considered to
be one of the best-selling books in the world. The ideas in his book are still
new and significant to all. The issues that he brought to the fore in his book
are still being constantly examined closely by experts, scientists, and
economists; it continues to raise a current problematic for investigation by the
world. Its readers, in varying degrees, are positively influenced by its
messages.
“Small Is Beautiful” is a work in which Schumacher has
criticized the economic system of the West, when he talks of modern technology.
The technology has been invented to lighten the burden of work, to save time
and it adapts labour-saving machinery. The tendency is to reduce working time
further, asymptotically to zero. Meanwhile, he says, no-one wants to increase
the leaving-school age and nobody wants to reduce the retirement age, so as to
keep people off the labour market. This, he says, is modern technology showing
an inhuman face. The requirement we need is to develop a compatible technology
suitable with the real needs of human nature and, at the same time, compatible
with the resources available to us. He has called for the development of
low-cost technology that is compatible with less-developed countries, where
local labour, local capital and local resources are utilized. He has observed
that the use of foreign aid for poor countries might make them more dependent
on rich countries. Modern technology cannot help much in developing countries,
but it continues to widen the gap between the rich and the poor. It diminishes
the capacity of people to develop further their manual skills and their
creativity; instead, causing complete dependency upon, and enslavement to mechanization.
Therefore, he has advised using intermediate technology of an intermediate size,
which can greatly assist poor countries, where most people are living in rural
areas, are less educated, and where there is widespread unemployment and
under-employment.
It is said that the problem of production have been solved by
all the experts, government economic advisers throughout the world and by academic
and less-than-academic economists, who have been reliant upon the many kinds of
fossil fuels that have been discovered. However, this approach can not be
justified on a truly gigantic scale. As he says in his book, there exists only
the illusion of unlimited resources. The destruction of the ecological system
and the natural resources that rich countries are trying to exploit so
radically represents violence against to nature; as he says: "Any
activity which fails to recognize a self-limiting principle is of the
devil";[2] with watchwords such as,
"more, further, quicker, richer",[3] "foul
is useful and fair is not",[4]
and "you cannot stand still, they say; standing still means going down;
you must go forward".[5] He
says that they are the watchwords of the present-day society, and in economics
it represents an anti-thesis of wisdom, catch-phrase that has been drawn
from a statement by an esteemed western economist, Keynes.[6] He
named those who were the forerunners and indicated that it would become worse
and end in disaster because of greed and envy. With these watchwords, he designated
them uneconomic. In this process the contradiction between economic development
and its limited resources is the root cause that has led people to adopt the
use of nuclear power. This, in turn, will be
extremely harmful to nature to the health of the soil, creatures and the lives
of human beings.
The misunderstanding and the misuse of resources are causing
many problems and hazards for humanity. Pollution is one of these effects.
There are many activities which are considered uneconomic but which are
nevertheless useful, such as cleanliness, maintaining the fertility of soil,
and the beauty of landscape; keeping the environment always clean, and avoiding
the use of poisonous substances, with due regard to the conservation of primary
resources such as animals and plants. We have no right to tyrannize, to ruin
and to exterminate them. The author says we can do this better if we can find
the strength to overcome the violence of greed, envy, selfishness, hatred and
lust within ourselves.
He has also criticized the education system that teaches and
encourages people to raise consumption as much as possible. Increasing consumption
means that we are further encouraging the expansion of the economy. However, he
says that material wealth and prosperity cannot bring ultimate and permanent peace.
Any material factors are entirely secondary to this consideration. The primary
causes of and eventual solutions to poverty are
immaterial: they lie in education, organization, and discipline. Herein lies
the central problem of development.[7]
Those who pursue it enable us to see the hollowness and fundamental
unsatisfactoriness of a life devoted primarily to the material ends, to the
neglect of the spiritual. Such a life necessarily sets man against man and
nation against nation, because man's needs are infinite, and infinitude can be
achieved only in the spiritual realm, never in the material. These are the real
causes of war and conflict. It is chimerical to build peace and permanence on
economic foundations which, in turn, rest on the cultivation of greed and envy.
The author believes that so far as education is concerned, there are mistakes
in the teaching and the provision of scholarships that furnish our minds with
piecemeal ideas and understanding that are entirely unsuitable, such as the
ideas that we might pick up from the natural sciences. Such poisonous errors
bring about unlimited sorrow in the third and fourth generations. A purely scientific
education cannot help us much because it only deals with concepts of know-how,
whereas what we need is to understand why things are as they are, and what we
are to do with our lives. Education can help us only if it is integral and produces
whole men.
“Buddhist economics must be very
different from the economics of modern materialism, since the Buddhists see the
essence of civilization not in a multiplication of wants but in the
purification of human character”,[8] emphasises
the author. A character is then formed primarily by the interest of his work,
by his skillful hands and by his creative brain. Although the content of
Buddhist economics was not largely considered in this book, we can easily
realize the ideas of Buddhism through this work. This is a difference that is difficult
for modern economists to understand, because they are used to measuring the
standard of living by the amount of annual consumption, assuming that a man who
consumes more is better off than a man who consumes less. Actually, the
teaching of Buddha about economics is only the Right Livelihood which is
mentioned in the book.[9]
However, we can also identify the Theory of Dependent Origination (Paticca-samuppāda),[10]
Impermanence (Anicca), and No-Self (Anattā),[11]
and Ahimsa (non-violence) in it, especially The Middle Way of economics (Majjhimāpatipadā)[12]
and an Attitude of Content with Few Desires.[13]
One of the greatest achievements of E.F. Schumacher in his
book “Small is Beautiful” is that he has applied Buddhist knowledge and his own
experience in modern economics to put a new face to modern society. He has applied
the Buddhist teachings to modern economics in a new orientation of human
activities in order to avoid harming nature, exploiting resources, and
degrading the environment. Such ideas have been calling for people to abandon
infinite greed and envy and to live in useful harmony with nature and to become
a means of encouraging people to reduce their greed and envy. Therefore, they
might be considered as a declaration of Buddhist economics.
Throughout the book he has constructed an entirely new
way of thinking that is useful to all of us, to all experts, to economists, to
scientists to reflect upon and review their actions. For example, he has stated
that economics does not play an ultimate role in leading to happiness, peace
and permanence of life; it is itself an end; and merely the means to an end
determined by something other than economics. What are required are education,
organization and discipline, as well, to balance the two major trends of life:
materialism and spirituality.
It is clear that Schumacher has brought about a revolution of
thought in economics. He has made a successful reform in transmission of small
as always being beautiful in the thinking of humankind. The theory of small is
beautiful has been brought out throughout the book as small technology, with
small size being used, with small resources, as an adequate response to man's
need; small need with small greed. It is a theory of how to utilize the minimum
means but with the maximum result. It has been asserted by Leopold Kohr
that: "If the Nobel Prize selection committee had wished to give the
prize in economics to an innovator, they would not have alternated between the
repairmen of the left and the repairmen of the right side of the ship of state
caught in the increasing pull of Niagara River a mile above the Falls; they
would have selected Dr. E. F. Schumacher".[14]
Although the author has developed many concepts of Buddhist
teachings as applied in modern economics, he has not explained all of them clearly.
As he said, “The Right Livelihood” is one of the requirements of the Noble
Eightfold Path in Buddhist economics; however, he has not undertaken any
discussion as to how it may be applied in modern society. Moreover, it would have
been better if he had also said something about the Middle Path, as applied in
modern economics.
Dr. E.F. Schumacher has developed a doctrine of the division
of social labour, in which the author states that everyone might have a job and
thus contribute his/her own part towards full employment, assisting both his
family and the society, while avoiding unnecessary leisure. For example, his
observation that women working in offices, companies or factories are a mark of
eco-social degradation is not completely reasonable. The quotation is as
follows: "Women, on the whole, do not need an 'outside' job, and the
large-scale employment of women in offices or factories would be considered a sign
of serious economic failure."[15]
However, he also comments: “[…] to let mothers of young children work in
factories while the children run wild would be as uneconomic in the eyes of a
Buddhist economist as the employment of a skilled worker as a soldier in the
eyes of a modern economist."[16]
In this review, we may say that although the book was written
more than thirty years ago, its ideas are still nowadays significant and useful
for us. These ideas have provided an orientation for experts, scientists,
economists and government in the development of every country's economy and in
the balance of ecology. However, achieving his purpose continues to present
difficulties because the needs, the thinking and the activities of people are
all very different. The problem remains. Moreover, the author has not offered
any further advice on the difficulties that scientists and economists have to
face within developing modern economics. Nevertheless, the book carries a clear
message: a call to action in our common task of responsible conservation and
development of the environment in which we live. The task is urgent and it
should be carried out here and now; not at some future point and not always by
others, because we have only one planet on which to live, and no second chances.
If we do not accept to live in these circumstances and fully embrace our responsibilities,
then we can only look forward to a constantly deteriorating situation and
ultimate disaster, as has been affirmed by the author. [17]
[2] E.F. Schumacher, Small Is Beautiful, (The United States:
Hartley & Marks, 1999), p. 127.
[3] Ibid.
[4] Ibid, p. 19.
[5] Ibid, p. 127.
[6] John Maynard Keynes, a
British economist whose ideas had a major impact in modern economics.
[7] E.F. Schumacher, op. cit., p. 139.
[8] Ibid, p. 40.
[9] The Right Livelihood or right life is one of
the Eightfold Path (Ariya-aṭṭhangika-Magga)
considered as correct livelihood or
Buddhist economics appears in many Buddhist Suttas for example, the Mahācattārīsaka Sutta, No.117 of the Mijjhima-Nikāya.
[10] Paṭicca-samuppāda preached by the Buddha in Bodhi Sutta, Udana I.1, Khuddaka Nikaya:
“When this is, that is.
From the arising of this comes
the arising of that”.
Everything
or Dhamma has an interactive relationship according to this concept; if we harm
the nature it means we harm ourselves.
[11] No-self
is a very common concept in Buddhism; that there is no individual independent
existence. Here, the author states that
to give a man a chance to join with another people in common works to overcome
his ego-cent-redness.
[12] In
Pāli Nikayas, it refers to a path
that avoids the extremes of asceticism and self-satisfaction. Here, in Buddhist
economics, it is not antagonistic to material enrichment but develops in the balance
of need and ecology or the simplicity and non-violence.
[13] It
can be translated as ‘Content with Few Desires’. In the last teachings of the
Buddha before entering Mahānibbāna
belong to Chinese Pitaka, the Buddha
talks to his disciples that the content with few desires can lead to ultimate
peace.
[15] E.F. Schumacher, op. cit., p. 41.
[16] Ibid.
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