Thomas More Institute

In our current malaise(s) it is worth musing on the work of the great German-born economist E.F. Schumacher (1911–1977). Schumacher brought the social teaching of the Catholic Church, in the form of the worked theories of subsidiarity and distributism, back to the forefront of economic debate. His legacy emphasises the Christian truth that ‘the substance of man cannot be measured by Gross National Product’.

Schumacher was dismayed by what he saw as the primitive materialism dominating modern times. He saw a world that had rejected the moral wisdom of the ages and was more concerned with goods than with people. Industrialism had resulted in short-term, erratic policy prescriptions, as well as an unstable and vulgar society. The profit motive had become central to human existence and towered over other concerns. Society had become ‘sick’ through taking acquisition of wealth for the supreme virtue.

It was in this context that Schumacher wrote his hugely influential Small is Beautiful, published in 1973. Perhaps the work’s greatest insight is to be found in its effort to synthesise economic theory and traditional wisdom. The thoughts of ‘sages’ such as Christ and the Buddha run through its pages; their sayings contrasted with our modern pursuit of wealth in a manner that cannot fail to affect the reader. Seek ye first the Kingdom of God…

A rooted rejection of a modern conception of economics and its place in political affairs flows through the work. Schumacher lamented the primacy of economics over moral, social, political, and aesthetic considerations. A focus on consumption, production, and accumulation of wealth degrades what is really meant to be a human being created in the imago Dei. Since we now live in a yet more materialistic culture than did Schumacher, the issues he raised affect us more deeply and insidiously.

Schumacher became a Catholic whilst writing Small is Beautiful, deeply influenced by Pope Paul VI’s refusal to bow to the concerns of the world in his Humanae Vitae. The solutions Schumacher provides in his work are profoundly influenced by social teachings of the Church. His discussions of labour, ownership, and the nature and purpose of the economy point up the arguments of the popes in encyclical letters such as Rerum Novarum and Quadragesimo Anno.

It was ultimately to the principle of subsidiarity that Schumacher would turn, a principle ever stressed through a century and more of Catholic social teaching. Leo XIII formulated the idea in Rerum Novarum, offering it as a Christian alternative to extreme capitalist and socialist forces sweeping late nineteenth-century Europe. Subsequent pontiffs have reiterated the teaching, including Benedict XVI in Caritas in Veritate. Pius XI in Quadragesimo Anno lucidly outlined the heart of the principle:

It is an injustice and at the same time a grave evil and disturbance of right order to assign to a greater and higher association what lesser and subordinate organisations can do. For every social activity ought of its own nature to furnish help to the members of the body social, and never destroy or absorb them.

Schumacher argued for what is small-scale against the cult of ‘big is best’. In economics, politics, and numerous other aspects of human affairs an abstract ‘giantist’ approach has won out. This may be seen, for example, in our reliance on supranational political organisations and dogmatic talk of economies of scale. This focus on the large often ignores real human concerns and yearnings, resulting in many folk feeling their powerlessness. Schumacher argued that we need to focus on smallness; on individuals, families and local organisations. This can make our affairs truly human once more.