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Sir Roger Scruton on Wilhelm Röpke’s ‘Humane Economy’

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This week, we received news of the unfortunate loss of Sir Roger Scruton, who passed away from cancer at age 75. As Rev. Ben Johnson wrote, Scruton was a “noted philosopher, expert on aesthetics, and intellectual architect of modern conservatism,” recently described by Prime Minister Boris Johnson as “the greatest modern conservative thinker.”

Scruton is perhaps best known for his contributions on art, community, conservatism, and conservation, but he also had plenty to say about economic life and the marketplace. As with all things, Scruton infused such thinking with his own distinctive conservatism, which began with “the sentiment that good things are easily destroyed, but not easily created,” and that “the work of destruction is quick, easy and exhilarating; the work of creation slow, laborious and dull.”

Scruton has described himself as a “reluctant capitalist,” recognizing the importance of economic freedom while remaining wary of the tendency among conservatives to conceive of quick-and-easy market solutions for any number of social problems. “I’m all in favor of market solutions where they apply,” Scruton explained in one interview, “but not every social problem has a market solution, and there is a need for the maintenance of traditions in education and in culture and in the law, which are not traditions of free enterprise.” It’s a critique he would apply to Margaret Thatcher, who, according to Scruton, “leaned too readily on market economics, and ignored the deeper roots of conservatism in the theory and practice of civil society.”

Yet while Scruton could easily be labeled a “market skeptic,” he differed from typical anti-market conservatives in where he turned for his alternate solutions. Whereas the latest breed of such politicians and thinkers seems to find the antidote to market disruption in the coercive and protective powers of government—whether through “pro-worker” tariffs and tax subsidies or otherwise—Scruton exhibited far more humility and hesitation about such a path, staying focused on how we ought to cultivate and conserve the layers between the individual and the state. And rightly so.

Skeptical of hubris on all sides, Scruton seemed to find somewhat of a satisfying answer in the works of Wilhelm Röpke, whose book, A Humane Economy: The Social Framework of the Free Market, promotes a unique blend of free-market thinking and good old fashioned communitarianism. As Sam Gregg recently wrote, recommending the book to today’s anti-market conservatives: “What makes Röpke’s case for the market economy distinct…is just how much it reflects a conservative’s case for economic freedom rather than a more recognizably classical liberal or a libertarian argument.”

This was certainly the appeal for Scruton, who admired Röpke for his peculiar position between the Austrian-school market enthusiasts and the “left-liberal thinkers” who happily yield all economic power to “unanswerable bureaucrats.” Although Scruton had his disagreements with Röpke, he largely accepted the book’s basic premise. “If the market needs to be constrained for the common good, then the constraint must come from below, not from above,” Scruton wrote, summarizing Röpke’s core argument. “It must be a social constraint, rather than a political constraint.”

In “The Journey Home,” an extended essay on the book, Scruton offers a thorough exploration of Röpke’s thought, reflecting on many of the key challenges we continue to wrestle with today.

Thus, in remembrance of Scruton’s profound wisdom and countless contributions to the conservative imagination, I’ve provided some extended excerpts of the essay below:

On the free market as necessary but not sufficient:

Röpke was aware that markets are not enough. They do not guarantee the goal of economic activity, which is the oikos, the place of settlement and security where people are at home with each other and at peace with their neighbours. The market mechanism may not be sufficient for social order, but it is necessary, for all the reasons spelled out by the Austrians.

Only in a market economy can prices serve as a guide to the scarcity of goods, or wages a guide to the supply of labour. Only in a market economy can individuals plan their own budgets and make rational choices for the deployment of their assets, their labour and their bargaining skills. The argument developed by Mises in his critique of socialism was, Röpke thought, demonstrative. The centrally planned economy destroyed the information on which rational economic decisions depend. This information is available in the form of prices and contracts in a free economy; but it is irretrievably dispersed by the attempt to dictate all economic factors from on high…Röpke’s interest was in the oikos, which he believed to be threatened from above by the state—something that he had seen at first hand with his experiences of the Nazis—and also threatened from below, by the anarchy of unbridled self-interest.

On the “true oikos” as a “a place of charity and gift”:

What was Röpke getting at, and how should we respond to the problems that he wished to address—the problems of social fragmentation and the loss of community feeling, in a world where the market is left to itself? There are those—Milton Friedman, for example, or Murray Rothbard—who have powerfully argued that a genuinely free market will ensure the good government of human communities, through the self-restraining impulse that comes naturally to us. But their arguments, however sophisticated, are addressed to Americans, who live among abundant resources, free from external threat, surrounded by opportunities and in communities where the volunteer spirit survives. And they do not confront the central question, which is how communities renew themselves, and how fundamental flaws in the human constitution, such as resentment, envy and sexual predation, are to be overcome by something so abstract and neutral as consumer sovereignty and free economic choice.

Röpke’s own idea, if I understand him rightly, was that society is nurtured and perpetuated at the local level, through motives that are quite distinct from the pursuit of rational self interest. There is the motive of charitable giving, the motives of love and friendship, and the motive of piety. All these grow naturally, and cause us to provide for each other and to shape our environment into a common home. The true oikos is not a cell shut off from the world, in which a solitary individualist enjoys his sovereignty as a consumer. The true oikos is a place of charity and gift, of love, affection and prayer. Its doors are open to the neighbours, with whom its occupants join in acts of worship, in festivals and ceremonies, in weddings and funerals. Its occupants are not consumers, except obliquely, and by way of replenishing their supplies. They are members of society, and membership is a mutual relation, which cannot be captured in terms of the ‘enlightened self interest’ that is the subject matter of economic theory. For extreme individualists of the Rothbard kind life in society is simply one species of the ‘coordination problem,’ as the game theorists describe it—one area in which my rational self-interest needs to be harmonized with yours. And the market is the only reliable way that we humans know, or could know, of coordinating our goal-directed activities, not only with friends and neighbours, but with all the myriad strangers on whom we depend for the contents of our shopping bags. Membership, if it comes about, is simply another form of quasi-contractual agreement, whereby we freely bind ourselves to mutual rights and duties.

On whether markets can inspire social cohesion:

In referring to a social market, economists leave a large hostage to fortune. For they express the view—endorsed by their socialist opponents—that the ‘social question’ demands an economic solution. And to some extent Röpke should be criticised on this score; he believed that a form of economic order could be developed which would deliver, as a benign by-product, the kind of social cohesion which he had found in the Swiss villages, and which he believed to express the communal heart of European society.

This was already to accept one of the most damaging of Marx’s ideas, which is that social institutions are the by-product, rather than the foundation, of the economic order. For if Marx’s view is right, then the cure to social ills must be framed in economic terms. Specifically, if the free market delivers a fragmented society then the solution is to replace the free market with another economic system. And how is that to be done, if not by state action, directing the economy towards defined social goals?

All this is contained in that troubling expression ‘a humane economy,’ seeming to imply that it is through economic organization that a society becomes humane, and not—for example—through love, friendship and the moral law. Röpke intended no such implication; but his style everywhere conveys the tension in his thinking between decentrism, as a social movement, and economic policy.

On the need for “communities of attachment” and a “shared moral order”:

Röpke is advocating, I believe, a community of attachment, in which people take an altruistic interest in each other’s situation; in which distress summons help and success congratulation; in which primary bonds of love, desire and friendship find an easy and socially endorsed pathway to fruition; and in which the pursuit of self-interest is circumscribed at every point by a concern for the common good. In so far as Röpke gives any indication of what a ‘humane’ society is, those are the kinds of consideration that he seems to be referring to.

So understood social membership cannot be achieved without settlement, meaning a relation among neighbours, who are united less by shared ambitions or shared ways of earning a living, than by shared territory, and all the obligations that go with that. A small and localised community is able to guide people, through its own vigilance, towards honest dealing, both to prevent the exploitation of the weak by the strong and to direct the profits of the wealthy towards the relief of the poor. This happens not because the community is organized economically in some way other than the spontaneous way of the market. It happens because people know each other, share each other’s fortunes, and recognize the penalties of defection. They are subject to common moral pressures, often preached at them in church, mosque or synagogue, and wish to see virtue rewarded and vice punished and cast out. Their self-perpetuating equilibrium occurs, when it occurs, because conflicts are resolved by the customs and laws which arise spontaneously among neighbours. If they also enjoy a market economy then this is a benefit which operates all the more effectively against such a background of shared moral order.

Why the state can’t help us with disruption from globalization:

If we take those complaints [about globalization] seriously, as we should, we will recognize the strength in Röpke’s intellectual starting point: which is the small local community, in which economic activity takes place under the vigilant guardianship of the moral sense. But we also recognize, I think, that we cannot return to that community through anything that resembles the ‘social market,’ as adopted by the post-war consensus in Europe. For what the social market amounts to in practice is the intrusion into the economy of another big anonymous entity—the state—which is quite as capable of externalizing its costs as any other. Not only that, but the state can silence its critics as no corporation can.

Thus the social market, as practised in Europe, requires the state to step in and provide for those without work, and to provide for the mothers of children who have no resident father. These are inevitable results of transferring the responsibility for charity from the community to the state, which is itself an inevitable result of the attempt to make a humane economy, rather than a humane society. Here are some of the costs: the growth of an underclass of people who do not work but who find every means to avoid work in order to enjoy the benefits provided by the state; the growth of illegitimacy, as women find an easy way to provide for themselves and their babies, and men an easy way to abandon the women they have impregnated; the growth of anti-social behaviour, as fatherless children are released from the dysfunctional households that produce them; and so on and on. The facts have been effectively documented by Charles Murray and others. And the result is clear: that Charles Murray and those like him could never hope to be employed in the state educational system in Europe, and would be subject to official condemnation by any politician called upon to consider the matter. The state has externalised the costs of its ‘social market’ policies onto society, and the greater the costs the more the state expands with fictitious plans to reduce them. Never has a better machine for expanding the rentier class of bureaucrats been devised than this one, which constantly amplifies the problem that it is established to solve. Hence, as educational achievement declines in Europe, state expenditure on education increases—to the point where, in Britain, there are nearly two bureaucrats for every teacher, appointed to deal with the social problems that they themselves make a living by producing.

On the real solution for market disruption:

What, then, is the real solution to the market-induced disorders of modern society? How do we prevent the globalisation of everything, and the fragmentation of our loyalties and attachments? How do we recover the small platoon, which shapes the moral sense of its members? The answer to these deep questions, it seems to me, is not to be found in any new economic order, but in a restoration of the moral foundations of a market economy…

Can localisation become a policy? Does that suggestion not merely reproduce the problem, by giving a new and over-mastering project to the state? This, it seems to me, is the problem that we now face. We Europeans—victims of the ‘social market’—have no means to replace statist policies without involving the state. Rather than end on that gloomy note, however, I will make a positive observation. When the great rush to the global economy began, in the late 18th century, the state did not have the power or the will to help the victims. Instead they helped themselves. A thousand social initiatives began at the turn of the 19th century—friendly societies offering non-profit loans for house purchase, charitable hospitals and networks of doctors, Church schools and village schools funded by subscription, Mechanics Institutes (later to become universities), not to speak of the clubs and societies of enthusiasts devoted to communal leisure. The reality of this is known to us full well from 19th century novels. And here in America, in the heart of the global economy, these initiatives still exist. They exist because the state has not expropriated the charitable motive, because people can give freely what they freely earn, and because there are still local loyalties which are the foundation of social hope. These initiatives should be the model for the ‘humane economy,’ which will be humane not because of the economy, but in spite of it.

I disagree with several of Scruton’s interpretations and conclusions—he tends to blame the market too much, and overly diminishes the social contributions that can spring from economic life—but he offers a refreshing perspective to such matters that we can all benefit from.

Whether we be crunchy communitarians, ardent free-market advocates, or otherwise, Scruton offers healthy cautions about the allure of power and the idols of modernity, whatever our preferred altars may be.

He is certainly correct that “markets are not enough,” and he did more than most to point our attentions and imaginations to the rest of the story.

Image: Roger Scruton no Fronteiras do Pensamento Porto Alegre 2019, Fronteiras do Pensamento (CC BY-SA 2.0)

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Joseph Sunde is an associate editor and writer for the Acton Institute. His work has appeared in venues such as The Federalist, First Things, The Christian Post, The Stream, Intellectual Takeout, Foundation for Economic Education, Patheos, LifeSiteNews, The City, Charisma News, The Green Room, Juicy Ecumenism, Ethika Politika, Made to Flourish, and the Center for Faith and Work. Joseph resides in Minneapolis, Minnesota with his wife and four children.