E.F. Schumacher: The Perils of Productivity

E.F. SchumacherLast year I participated in a conference in Antwerp organized to celebrate the 100th anniversary of the birth of economist and environmentalist E. F. Schumacher (1911-1977), and I have written several pieces on his continuing relevance. An essay in last Saturday’s  New York Times by Tim Jackson, entitled “Let’s Be Less Productive,” provides further evidence that Schumacher’s insights should still resonate today. (So too does Hewlett-Packard’s recent announcement that it plans to cut 27,000 workers.)

In the 1970s Schumacher called productivity “the basic aim of modern industrialism.” He understood why economists stressed it so much. In capitalist societies it enabled goods to be produced for less, thus contributing to a drop in consumer prices, enabling us to buy more. (Communist governments emphasized it for more complex reasons.)

But increasing productivity, he believed, had also exacerbated unemployment, the alienation of labor, ecological damage, and the over-crowding of cities.  His point was not that productivity was bad but that its value had to be considered within a larger context.

In essays such as “Buddhist Economics” (in his 1973 collection Small Is Beautiful) he called for a wisdom-centered economics that would emphasize well-being rather than consumption, and meaningful and rewarding employment rather than productivity. Too many economists, he thought, stressed profits and increasing consumption without taking into consideration more ultimate human ends.  Contrary to most of them, he insisted that if certain types of big technology put people out of work, perhaps it might be better to use a more appropriate technology in order to keep on more employees even if it meant less productivity per person.

He quoted Gandhi who said that “there should be no place for machines that concentrate power in a few hands and turn the masses into mere machine minders, if indeed they do not make them unemployed.” He also mentioned Gandhi’s belief that the “poor of the world cannot be helped by mass production, only by production by the masses.” In another essay in Small Is Beautiful, he illustrated his thinking on the relationship of productivity to employment by the following words:

At one-sixth of present-day productivity. . . . there would be six times as much time for any piece of work we chose to undertake—enough to make a really good job of it, to enjoy oneself, to produce real quality, even to make things beautiful. . . . No one would then want to raise the school-leaving age or to lower the retirement age, so as to keep people off the labour market. Everybody would be welcome to lend a hand. Everybody would be admitted to what is now the rarest privilege, the opportunity of working usefully, creatively, with his own hands and brains, in his own time, at his own pace—and with excellent tools.

Even though he was not suggesting that any society reduce its overall productivity by one-sixth, such thinking was unconventional because increasing productivity, often lowering consumer prices, was considered sacrosanct.

One reason he thought it should not be so regarded was because of the ecological dangers of ever-increasing consumption, spurred on by increasing productivity. In Small Is Beautiful he declared that “ecology, indeed, ought to be a compulsory subject for all economists.”

Thus, some quotes (which follow) from Tim Jackson’s Op Ed sound very Schumacherian—perhaps not surprising in that he refers favorably to London’s New Economics Foundation, a think tank strongly influenced by Schumacher’s ideas.

“Productivity . . . is often viewed as the engine of progress in modern capitalist economies. Output is everything. . . . Ever-increasing productivity means that if our economies don’t continue to expand, we risk putting people out of work. . . . Increasing productivity threatens full employment.” Like Schumacher, Jackson suggests an alternative: “Loosen our grip on the relentless pursuit of productivity.” And he believes that “there are sectors of the economy where chasing productivity growth doesn’t make sense at all. What sense does it make to ask our teachers to teach ever bigger classes? Our doctors to treat more and more patients per hour?” He also identifies other types of labor, such as craftsmanship and artistic work, where it would be foolish to regard “low productivity . . . as a disease.”

Jackson shares Schumacher’s belief that other goals should take precedence over productivity and that whenever possible labor should be emotionally rewarding, contribute to the common good, and help the environment. In the Op Ed he states:

“A whole set of activities that could provide meaningful work and contribute valuable services to the community are denigrated because they involve employing people to work with devotion, patience and attention. But people often achieve a greater sense of well-being and fulfillment, both as producers and consumers of such activities, than they ever do in the time-poor, materialistic supermarket economy in which most of our lives are spent.”

walter moss

Walter Moss

He also writes of the “need to reign in growth [and its overemphasis on productivity] for the damage it’s inflicting on the planet: climate change, deforestation, the loss of biodiversity.”

Finally, like Schumacher, he realizes that the “transition to a low-productivity economy won’t happen by wishful thinking,” that difficult concrete steps are necessary.  But what’s the alternative to less emphasis on increasing productivity, consumption, and all the environmental havoc that has been wreaked?  As Schumacher wrote: “We must . . . begin to see the possibility of evolving a new life-style, with new methods of production and new patterns of consumption: a life-style designed for permanence.”

Walter Moss

Walter G. Moss is a professor emeritus of history at Eastern Michigan University. For a list of his recent books and online publications, click here. He has written about Russian culture in essays, reviews, and in his A History of Russia  Vol. 1 (2003) and  Vol. 2 (2005), and in Russia in the Age of Alexander II, Tolstoy and Dostoevsky(2002).

Posted: Tuesday, 28 May 2012

Published by the LA Progressive on May 29, 2012
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About Walter G. Moss

Walter G. Moss is a professor emeritus of history at Eastern Michigan University. His most recent book is An Age of Progress?: Clashing Twentieth-Century Global Forces (2008). For a list of all his recent books and online publications, including many on Russian history and culture, go here: http://people.emich.edu/wmoss/pub.htm