9
during the cold war period following World War II. As often happens, the moderate reformers
are the first casualties in a conflict – they are being shot at from both sides. Engels’
Anti-
Dühring is one such vehement attack on a set of theories that aimed at making capitalism a just
and equitable society. Eugen Dühring, who was most sympathetic to the aims of Marx and
Engels, but not to their methods, was perceived as their most dangerous enemy. Alternative
‘Third Way’ theories continued to live on in the pragmatic economic policies of social democ-
racy, but the economic theory of social democracy most unfortunately became neo-classical eco-
nomics. This made it virtually impossible to export practically functioning social democracy to
the Third World -the theories which were at the roots of the political ‘Third Way’ had been
unlearned by the economics profession.
3. Anthropocentric Economics: Man and his Needs as the core of Economics
Karl Bücher’s book
Die Entstehung der Volkswirtschaft addresses the geographical dimension of
economic stages. Die Entstehung is a collection of essays around this same subject, and was first
published in 1893. In his memoirs Bücher makes it clear that his preference was not for large
texts, but rather for small essays. His publisher started typesetting his books long before the au-
thor had finished writing, and Bücher tells us that he worked best when the typesetter was just
catching up on his writing. ‘Not even half of the works I have published in my lifetime’, he says
in his memoirs, ‘would have existed if my publisher had demanded that all the text be finished
[190] before he started typesetting.’
25
Historians of literature similarly point to the fact that his
publisher, who needed to get the books out, paced Henrik Ibsen’s production to an important de-
gree.
Chapter 3 of
Die Entstehung, which is the core chapter presenting the stage theory, goes back
to a lecture by Bücher at the University of Basel in 1885 (p. V). The book appeared in one vol-
ume in 10 printings, being reprinted in 1897, 1900, 1904, 1906, 1908, 1909, 1911, 1913, and
1917. A second volume of essays was added with the 11th printing in 1918, both volumes carry-
ing the same title. This second volume, coinciding with the end of WW I, seems to have re-
newed the interest in the first volume, because both the 12th and 13th edition of the first volume
were published in the first six months of 1919.
26
There is a US edition in English –
Industrial
Evolution – published in New York in 1901, and a Canadian edition published in Toronto in
1904 (Entitled Industrial Society).
Bücher’s Die Entstehung der Volkswirtschaft (The Genesis (or Formation) of the National
Economy) is, in its core aspects, a classical book written in the German tradition. On fundamen-
tal points this book is in strong conflict with the world view represented by today’s standard An-
glo-Saxon economics, the brand of economics which completely dominates in ‘the global vil-
lage’ of today. While public opinion today is increasingly worried about maintaining the bio-
logical diversity of the planet – opposing cloning – few seem to care about the lack of diversity
in approaches to economics. In their core assumptions about what their profession is all about,
virtually all of today’s living economists are cloned in a mode of thinking which is fundamen-
25
Lebenserinnerungen, Tübingen, Laupp, 1919, p. 199. (Title reads Enter Band, 1847-1890, but this is apparently
the only volume to have been published).
26
The latter information can be found in the advertising pages, following page 462, in Bücher’s Memoirs, Lebenser-
innerungen, Tübingen, Laupp, 1919.
10
tally different from that of Karl Bücher and the production-based tradition. We shall here briefly
contrast Bücher’s conception of economics with that of today’s barter-based economics.
First of all, the very title of the book – The Genesis of the National Economy – is an affront
to English economics at the time
[191] (and even today, as in Margaret Thatcher’s phrase ‘There
is no such thing as society.’) In German economics, the Volkswirtschaft – the National Econ-
omy – is a fundamental unit of analysis, while, as Friedrich List pointed out, English economics
is cosmopolitical economics. The factors which cause the nation state to be of any importance
tend to be assumed away in English economic theory as well as later in neo-classical and in to-
day’s standard theories. The core assumptions of Anglo-Saxon economics create – in Lionel
Robbins’ felicitous term – an automatic Harmonielehre between all players, be it states or indi-
viduals. One basic mechanism creating a social harmony in neo-classical theory, is the fact that
neo-classical economics made all economic activities qualitatively alike as carriers of economic
development. This is what Buchanan calls the equality assumption, without which mainstream
economics would lose its analytical power. Like all stage theories, Bücher’s theory functions at
a different, and lower, level of abstraction. Bücher is praxisnah – near to reality. He scorns what
he sees as ‘die verschimmelte Schulweisheiten’ – the mouldy school truths – of theoretical eco-
nomics.
27
Secondly – as is so often pointed out by German economists up until W II – English econom-
ics was fundamentally a theory of barter, and not of production?
28
Very early in his Wealth of
Nations Adam Smith defines ‘his propensity to barter’ as the main difference between Man and
other animals.
29
Bücher goes very clearly against Smith on this: ‘Primitive Man, rather than hav-
ing an innate propensity to barter, has – to the contrary – a propensity against bartering. (Eine
Abneigung). In the old language, Bücher says, the verbs for barter (tauschen) and cheat
(täuschen) are the same. There is plenty of evidence to support the idea that trading was an oc-
cupation of very low prestige in many ancient cultures. On discovering that his wife owned a
ship trading grain, one Byzantine emperor had the whole ship and its cargo burned in order to
distance himself as much as pos-
[192]sible from such ‘vulgar’ activities.
30
We can assume that
since no standard method for measuring value existed, early bartering carried with it a high risk
of being cheated. Anthropological research into processes of barter points at stable value rela-
tionships existing over long periods of time; e.g. ‘a sheep for a sack of potatoes’. Bücher men-
tions, however, von Thünen as a German economist who in his Isolierte Staat starts from the as-
sumption of a barter economy.
31
This could account for the fact that von Thünen – out of a huge
number of German economists who wrote on economics and geography – is the only German
economist which is quoted in Paul Krugman’s papers on economics and geography.
To Adam Smith, then, ‘in the beginning there were barter and markets’, to Karl Bücher ‘in
the beginning there were production and social relations’. To Bücher – as well as later to Karl
Polanyi
32
who was inspired by him – during the early stages of civilisation the processes of pro-
duction and consumption are so intertwined that the concept of barter makes no sense. As al-
27
Lebenserinnerungen, p. 197.
28
Bücher says to this: ‘Die englische Nationalökonomie ist darum im wesentlichen Verkehrstheorie.’, Die
Entstehung, p. 89.
29
On p. 17 in the 1976 Chicago edition.
30
This story is told in Nicol, Donald M., Venezia e Bisanzio, Milan, Rusconi, 1990.
31
Die Entstehung, p. 90.
32
Polanyi, Karl, The Great Transformation, New York, Rinehart & Co., 1944.