The Worldly Philosophers

Putting a human face on the bleak science of Economics

In his book "The Worldly Philosophers," economist Robert L. Heilbroner tells the story of New Lanark. It was a model community near Glasgow, Scotland with a guestbook signed by the world leaders from 1815 to 1824 Heilbroner writes. The abandoned village still draws visitors today.

Robert Owen, a self-made textile kings during the industrial revolution founded New Lanark after purchasing the mills from his future father-in-law. To run the mill, Owen used the same poor underclass as filled the factories of other mills.

Heilbroner’s book is a collection of short biographies of great figures in the world of economics. They include the figures that form footnotes in other works, such as Robert Owen, as well as the major thinkers of this intellectual discipline including the man most tightly linked to the "dismal science", Adam Smith.

Born in the town of Kirkcaldy in County Fife, Scotland, Smith was the epitome of the absent-minded professor. Heilbroner’s account examines the eccentricities of the man and his world that eventually led to the publication of Smith’s major treatise Wealth of Nations. It proposed "a theory of society in which everyone moved together up the escalator of progress."

The others in Heilbroner’s book paint a bleaker picture of the theory of society. They include Thomas Robert Malthus and his treatise An Essay on the Principle of Population as It Affects the Future Improvement of Society. The essay argued that humanity’s drive to reproduce itself would eventually lead to its ultimate destruction.

Adding another dismal twist to the theory of society is David Ricardo, "an astonishing successful stockbroker." Heilbroner says that Ricardo portrayed Smith’s "escalator worked with different effects on different classes, that some rode triumphantly to the top, while others were carried up a few steps and then kicked back down to the bottom. Worse yet, those who kept the escalator moving were not those who rose with its motion, and those who got the full benefit of the ride did nothing to earn their reward." Pretty insightful stuff for a stockbroker who was well up the escalator himself.

Is it no wonder that such a dismal science ultimately produced a philosopher of the other extreme, Karl Marx? The son of a prosperous Jewish family in early 1800’s Germany that "adopted Christianity so that patriarch Heinrich Marx, an advocate might be less restricted in his practice." Marx’s monumental work "Das Kapital is the Doomsday Book of capitalism, and in all of Marx there is almost nothing that looks beyond the Day of Judgement to see what lineaments paradise may present."

Heilbroner concludes the biography of Marx with this telling statement. "The answer to Marx lies not so much in pointing out the injustices of communism as in demonstrating that capitalism can continue to evolve and to adapt its institutions to the never-satisfied demands of social justice."

Ricardo world of an escalator with a handful of fat cats battling for the choice steps at the top of while the rest of the society struggles to stay on at the bottom is a precursor to the world of Thorstein Veblen. "His inquiry began not with the economic play, but with the players; not with the plot, but with the whole set of customs and mores which resulted in that particular kind of play called "the business system."

Veblen was 42 when he published The Theory of the Leisure Class. "No wonder it created attention," writes Heibroner, "for never was a book of sober analysis written with such pungency. One picked it up at random to chuckle over a its wicked insights, its barbed phrases, and its corrosive view of society in which elements of ridiculousness, cruelty, and barbarousness nestled in close juxtaposition with things taken for granted and worn smooth with custom and careless handling. The effect was electric, grotesque, shocking, and amusing, and the choice of words was nothing less than exquisite."

The one other major figure of economics Heilbroner describes is John Maynard Keynes, the great English economist who most shaped post-depression economic thought. Born in 1883, the year Karl Marx died, Keynes (rhymes with "rains") led a charmed life. He succeeded with ease at Eton, then King’s College at Cambridge, and finally Bloomsbury—the meeting place and state of mind of British intelligentsia.

Keynes’ most recognized work, was an economic treatise on why economic systems have boom and bust cycles and why there is no automatic mechanism for moving from one extreme to another. It was a revolutionary idea at a time when it was generally believed that recession gave way to expanded economic booms and vice versa based on economic forces.

"Rather than a seesaw which would always right itself, the economy resembled an elevator: it could be going up or down, but it could also be standing perfectly still. And it was just as capable of standing still on the ground floor as at the top of the shaft. A depression, in other words, might not cure itself at all; the economy could lie prostrate indefinitely, like a ship becalmed."

Heilbroner’s work is not merely a dissertation of the accomplishments of these major and minor figures in the history of economic. Rather, it is a series of sketches of insightful thinkers, complete with anecdotes about their lives and their times. The work not only details the thinking of great men; it also provides an understanding of the forces that affect our daily lives.

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