History of Economic Analysis part 10

History of Economic Analysis part 10. At the time of his death in 1950, Joseph Schumpeter-one of the major figures in economics during the first half of the 20th century-was working on his monumental History of Economic Analysis. A complete history of humankinds theoretical efforts to understand economic phenomena from ancient Greece to the present, this book is an important contribution to the history of ideas as well as to economics.
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History of Economic Analysis part 10 History of economic analysis 52 Republic2) is no more analysis than a painter’s rendering of a Venus is scientificanatomy. It goes without saying that on this plane the contrast between what is and whatought to be loses its meaning. The artistic quality of the Politeia and of the wholeliterature—mostly lost—of which the Politeia seems to have been the peak achievementis well brought out by the German term for it, Staatsromane (literally: state novels). Indefault of a satisfactory English synonym we must use the word Utopia. The readerpresumably knows that more or less under the influence of the Platonic example, thistype of literature again found favor in the Renaissance and thencontinued to be produced, sporadically, to the end of the nineteenth century.3 But analysis comes in after all. There is a relation between the painter’s Venus and thefacts described by scientific anatomy. Just as Plato’s idea of ‘horseness’ obviously hassomething to do with the properties of observable horses, so his idea of the Perfect Stateis correlated with the material furnished by the observation of actual states. And there isno reason whatever to deny the analytic or scientific character—remember: we do notattach any complimentary meaning to either of these words—of such observations offacts or relations between facts as are enshrined, explicitly or by implication, in Plato’sconstruction. Reasoning of an analytic nature is still more prominent in a later work, theNomoi (Laws). But nowhere is it pursued as an end in itself. Consequently it does not govery far.Plato’s Perfect State was a City-State conceived for a small and, so far as possible,constant number of citizens. As stationary as its population was to be its wealth. Alleconomic and non-economic activity was strictly regulated—warriors, farmers, artisans,and so on being organized in permanent castes, men and women being treated exactlyalike. Government was entrusted to one of these castes, the caste of guardians or rulerswho were to live together without individual property or family ties. The changesintroduced in the Nomoi are considerable—chiefly they are compromises with reality—but they do not touch the fundamental principles involved. This is all we need for ourpurpose. Though Plato’s influence is obvious in many communist schemes of later ages,there is little point in labeling him a communist or socialist or a forerunner of latercommunists or socialists. Creations of such force and splendor defy classification andmust be understood in their uniqueness, if at all. The same objection precludes attemptsto claim him as a fascist. But if we do insist on forcing him into a strait jacket of our ownmaking, the fascist strait jacket seems to fit somewhat better than the communist one:Plato’s ‘constitution’ does not exclude private property except on the highest level of the2 The standard English translation by B.Jowett includes introductory essays on Plato’s life,writings, and philosophy, and an analysis of the work.3 The best interpretation of Greek Staatsromane that I know of—and one that is itself a work ofart—is Edgar Salin’s Platon und die griechische Utopie (1921). This literature naturally reflects thesocial movements of its time, a subject into which it is impossible to enter here. See Robert vonPöhlmann’s Geschichte der sozialen Frage und des Sozialismus in der antiken Welt (1912). Graeco-roman economics 53purest ideal; at the same time it enforces a strict regulation of individual life, includinglimitation of individual wealth and severe restrictions upon freedom of speech; it isessentially ‘corporative’; and it recognizes the necessity of a classe dirigente—featuresthat go far toward defining fascism. The analytic background, such as it is, comes into view as soon as we ask thequestion: why this rigid stationarity? It is difficult not to answer (however pedestriansuch an answer may sound to the true Platonist) that Plato made his ideal stationarybecause he disliked the chaotic changes of his time. His attitude to contemporaneousevents was certainly negative. He hated the Sicilian tyrannos (though we must nottranslate this word by tyrant). He almost certainly despised the Athenian democracy. Yethe realized that tyranny grew out of democracy and was, in any case, the practicalalternative to it. Democracy, in turn, he interpreted as the inevitable reaction to oligarchy,and this again he traced to inequality of wealth, the consequence, as he thought, ofcommercial enterprise (Politeia VIII). Change, economic change, was at the bottom ofthe development from oligarchy to democracy, from democracy to tyranny (of a popularleader), that was so little to his taste. Whatever we may think of Platonic stationarity asthe remedy, is there not a piece of ...