Gradgrindian Economics?

Immediately upon finishing one rather technical book on economics and social science, I made a start on Charles Dickens’ Hard Times (in a rather fetching cloth-bound cover):

Hard Times

I thought, upon picking it up, that it would be as different from the last book as possible. Not an ounce of economics or social science in it. How wrong I was!

Running throughout the book (well, what I’ve read so far*) is a continuing attack on economic thinking, and the whole growing trend towards statistical and scientific methods that were driving the industrialising society that Dickens was critiquing in the book.

The book, published in 1854, is concerned with a fictional town called Coketown – an archetypal red-brick Northern industrial town full of belching chimneys, thrumming factories and endless identical terraced houses. Looking back, its easy to forget what a dramatic rupture industrialisation was with all pre-existing human societies. While, of course, industrialisation eventually led to humans living longer, healthier and materially abundant lives; there was a huge dislocation between the older way of life. The old social order was being swept away as people were drawn off of the land and into new industrial towns. Work, which would previously have taken place on the land or in small scale crafts, was transformed as everyone, including women and children, crowded into factories and spent their day in monotonous tasks, becoming mere appendage of a machine.

The other big social change was the emergence of a rising middle class of industrialists and businessmen, who began to usurp the landed nobility and gentry. It was the economic interests of this new class which the classical economistsThomas Malthus, Adam Smith, David Ricardo – are associated with. It is among this new class that the dominant character of the first part of the novel, Thomas Gradgrind, comes from. His first words (the first in the book), which go some way to explaining his character, are:

Now, what I want is, Facts. Teach these boys and girls nothing but Facts. Facts alone are wanted in life. Plant nothing else, and root out everything else.

Having made his money in the hardware trade, and now the headmaster of a school; he has no time for imagination, or creativity, or sentiment… Fancy as he calls it. His children (a couple whose first names are Adam Smith and Malthus in another dig at economics) are not allowed to read fiction or go to the circus, but are fed a steady diet of lessons, lectures and scientific experiments. The pupils at his school are mere vessels to be filled with Fact – mathematical equations and chemical reactions – all the better to prepare them for their place in the industrial machine they will no doubt become a part.

Things that can be measured and added and subtracted are the only things that matter to him. It is immediately apparent that it is this spirit: trying to reduce human existence to mere calculus, that Dickens is attacking**.

Despite being a little harsh and narrow, he’s not necessarily a bad man. He takes on Cecilia ‘Sissy’ Jupe, a circus girl whose clown father abandons her and agrees to educate her at his school. She’s a bit of a free spirit and doesn’t take to learning too well. I’ll quote extensively from the next section, as it contains many funny swipes at economics.

In this scene, she’s discussing how hard she finds school with Louisa Gradgrind, Thomas Gradgrind’s daughter:

‘I am almost ashamed’, said Sissy, with reluctance, ‘but today, for instance, Mr M’Choakumchild was explaining to us about Natural Prosperity.’

‘National, I think it must have been,’ observed Louisa.

‘Yes, it was. -But isn’t it the same?’ she timidly asked.

‘You had better say, National, as he said so,’ returned Louisa with her dry reserve.

‘National Prosperity. And he said, Now, this schoolroom is a Nation. And in this nation, there are fifty millions of money. Isn’t this a prosperous nation? Girl number twenty, isn’t this a prosperous nation, and an’t you in a thriving state?’

‘What did you say?’ asked Louisa.

‘Miss Louisa, I said I didn’t know. I thought I couldn’t know whether it was a prosperous nation or not, and whether I was in a thriving state or not, unless I knew who had got the money, and whether any of it was mine.

That’s a brilliant last line. Economic statistics (National Prosperity is something we would think of nowadays as GDP, a common measure of how rich a country is) leave out as much as they explain. They only point to aggregates or averages – and doesn’t necessarily describe individual experiences, which is what matters to most of us. Sissy also realises it also doesn’t say how that prosperity’s shared out. But no one thinks GDP is the be-all-and-end-all. The same economic science that can measure GDP can make descriptions of inequality, which can inform more subjective debates over fairness.

The conversation continues:

‘Then Mr M’Choakumchild said he would try me again. And he said, This schoolroom is an immense town, and in it there are a million of inhabitants, and only five-and-twenty are starved to death in the streets, in the course of a year. What is your remark on that proportion? And my remark was – for I couldn’t think of a better one – that I thought it must be just as hard upon those who were starved, whether the others were a million, or a million million.’

Again, Sissy makes a wonderful point. If only 0.0025%*** of the town starves to death a year – it is still a tragedy for that 0.0025%. 0.0025% is too much. But it’s better than 1%. And knowing the scale of the problem can only be beneficial in solving it. Maybe it will spur efforts to reduce the number to 0.001% next year.

My final quote is taken slightly later, where Dickens is describing one of the factories in Coketown:

So many hundred Hands in this Mill; so many hundred horse Steam Power. It is known, to the force of a single pound weight, what the engine will do; but, not all the calculators of the National Debt can tell me the capacity for good or evil, for love or hatred, for patriotism or discontent, for the decomposition of virtue into vice, or the reverse, at any single moment in the soul of one of these its quiet servants, with the composed faces and the regulated actions. There is no mystery in it; there is an unfathomable mystery in the meanest of them, for ever. -Supposing we were to reserve our arithmetic for material objects, and to govern these awful unknown quantities by other means!

I think this passage goes to the heart of a common criticism made against economics. It treats people, it is claimed, as desiccated calculating machines. Ultra-rational, forward-looking, utilitymaximizing homo-economicus-es. No room for love or selflessness or stupidity, virtue or vice.

But this is a straw man. Economics seeks to approximate man in his economic life, and if their models do a reasonable job which can match what we see around us, why not?

And that’s not to suggest that they don’t consider man more widely. Scientists do study how we depart from being fully rational. They do recognise that we have other motives than money and self-advancement, and that sometimes it’s better to appeal to these than pecuniary self-interest. They realise we care about fairness and are influenced by peer pressure and social expectations.

And let’s consider that last sentence, “Supposing we were to reserve our arithmetic for material objects, and to govern these awful unknown quantities by other means!” People have used such arithmetic to find how much of a population has a particular disease, or suffers from hunger or illiteracy, or the hours people work and so on. It is as a result of such efforts that perhaps more people than otherwise are healthier, better fed, better educated and have more congenial working conditions.

Economics is not some narrow, autistic subject that treats people as equations and automatons. It is about harnessing our knowledge of how people and societies function in order to allow people to live more fulfilling lives. I’ll leave the last word to an economist, John Maynard Keynes, who hoped that due to the advancement in economic knowledge and conditions:

For the first time since his creation man will be faced with his real, his permanent problem – how to use his freedom from pressing economic cares, how to occupy the leisure, which science and compound interest will have won for him, to live wisely and agreeably and well.
.

*The first hint about this occurs before the story even starts. The book is dedicated to the historian Thomas Carlyle, who famously denounced economics as “the dismal science” (-it should be noted in an essay named, Occasional Discourse on the Negro Question which defended the use of black slaves and was rather racist.

**This found its expression in Utilitarianism, which initially sought to explain all human behaviour by the fact that we seek pleasure and avoid pain. If we can quantify exactly how much pleasure and pain each circumstance provides, then we can calculate precisely how humans will react in just the same way we can calculate how a billiard ball will react if we can quantify the forces applied to it. This calculation of the pleasure and pain we experience was given the wonderful name of the hedonic calculus.

***25 out of 1,000,000. To calculate the percentage: 25/1,000,000 × 100% = 0.0025%

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One response to “Gradgrindian Economics?

  1. Pingback: Big Data Is Watching You – And Wants You To Be Happy | Steven Clarke's Blog

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