THE INVENTION OF SOCIOLOGY, MORE BENEFICIAL THAN THAT OF ECONOMICS

 

Working classes and the poor in England and the rest of Europe had a better fate after the appearance of the positivist doctrine of Auguste Comte (1798-1857) and after the "invention" of sociology. Comte's field surveys and positivist philosophy inspired two altruistic British businessmen, Charles Booth and Seebohm Rowntree, in the late 19th century , who laid the foundations of British sociology.

The two paid out of  their own pocket for sociological surveys to be conducted on the phenomenon of poverty in London and York. The Booth-sponsored survey found that by the end of the 19th century, 30.7 percent of London's population was still living in poverty (according to a World Bank study, the proportion of poor people in Western Europe in the early 19th century was about 84 percent). Rowntree 's survey gave a similar proportion for Yorkshire and set a sociological poverty line. 

Together, their investigations and lobbying led to the introduction by the British government of a system of social insurance and pensions, starting in 1909. In 1909, the report of the Royal Commission on the Laws of the Poor (Majority Report) was based on the findings of the sociological surveys sponsored by Charles Booth. Rowntree - the owner of a chocolate factory - introduced an 8-hour working day, a 5-day working week into his company and decided to increase the salaries of his employees. For his measures in industrial relations, welfare and management, Rowntree was proclaimed as "the British management movement's greatest pioneer" (Lyndall Urwick).

Neither Booth nor Rowntree flirted with socialism, both reformers having been staunch supporters of liberalism.

 It is a well-known fact that Rowntree and Booth were deeply influenced in their actions by the positivist philosophy of Auguste Comte. In other words, the father of sociology had a beneficial influence on his European contemporaries, clearly superior to the detrimental influence exerted by the founders of classical economics - Adam Smith and David Ricardo - on most economists and much of nineteenth-century liberal politicians.

 It can therefore be said with some certainty that the new science of sociology arose from the need to counteract the negative effects on British intellectual and political elites of the mistaken or retrograde ideas inherited from the classics of economics.

THE EMBARASSING IDEAS OF THE CLASSICS OF ECONOMIC SCIENCE

 I said in my previous post about Smith / Ricardo that even to this day we collectively have the misfortune to suffer the consequences of an economic ideology developed by people from peripheral and poor regions of Europe. I was referring, of course, to Adam Smith and his native Scotland, who joined the British Union in 1707.

Smith profoundly influenced Thomas Malthus, who in his well-known essay on the principle of population expressed his revolt over the indifference of the English rulers of the time, who dared to ignore the "recommendations" launched in Adam Smith's "Wealth of Nations," especially those concerning the aids for the poor. (It should be noted here that the only nations with a state welfare system for the entire population in the eighteenth century were only England and the Netherlands. In the case of England, aid laws for the poor were even several hundred years old.)

But here is what Malthus proposes in his essay, re-edited by him in 1817:

"I have been thinking for a long time about the English laws regarding the poor. (...)

... I propose to publish a law refusing parish assistance (in England, state aid was distributed to the poor by law through the network of Anglican parishes) to CHILDREN born from a marriage contracted more than one year after the publication of such laws, and all illegitimate children born two years after the enactment of the same law. "

In 1834, following campaigns mounted against continuing aids for the poor, Parliament decided to stop them ... 

William Senior, who drafted the text of the decree in question, was also the first professor of economics - the new discipline - at Cambridge. From the outset, therefore, classical British economists proved hostile to wage-earners and to the poor. From a social point of view - keeping in mind the fact that economics is a social science - this legislation represented a huge setback.

Here is how Adam Smith saw the solution to the fluctuations in the price of wheat, which quite often generated hunger among employees during that period:  "Smith made us see clearly that the natural tendency in a year of famine is to deprive workers of jobs of any kind or to force a large number of workers to work for a low wage, due to the impossibility for employers to hire the same number of people at the same price as before. An increase in wages  will only lead to an increase in the number of unemployed and would do away, warns this author (i.e. Smith) with the beneficial effects of a period of moderate famine, which tends to make people more industrious, attentive and economical "  (Thomas Malthus," Essai sur le Principe de la Population ", p. 63)

However, another Scottish economist of the time, Sir James Steuart ( 1712 - 1780 ) - who fully deserves the status of co-founder of economics - was knowingly marginalized by Adam Smith. In contrast, James Steuart was a staunch supporter of state intervention in the economy. Thus, Steuart believed neither in laissez-faire in economic policy nor in the existence of the "invisible hand" that would allow markets to self-regulate. During the debate over the increase in wheat prices in his day, Steuart recommended state intervention to stabilize prices and to ensure the quantities of wheat needed for consumption by the population.   "He proposed an intervention scheme reminiscent of the common agricultural policy (CAP) which was adopted by the European Community ". (Gilles Dostaler, "James Steuart, the fight lost against Adam Smith", Alternatives économique, 5/2010, no. 291 p. 76).

Unfortunately, Adam Smith's ideas still decisively influence the political action of some US Republicans. Members of the Washington DC Heritage Foundation for example - very influential during the Reagan and Bush administrations - wore ties printed with the portrait of Adam Smith at ceremonies, until recently. No other comments necessary...