Materialism has had its day. To understand the ideas that drive human activity, including economics, we need a new field that combines the arts and sciences, argues Deirdre N. McCloskey.
The Marxists, of course, once passionately held the idea that ideas are rubbish. As it was put in 1848 by a pair of historical materialists: "Man's ideas, views and conceptions, in one word, man's consciousness, changes with every change in the conditions of his material existence, in his social relations and in his social life. What else does the history of ideas prove, than that intellectual production changes its character in proportion as material production is changed?"
It has been a long time, though, since even the Marxists depended on such a materialist postulate. Stuart Hall in cultural studies denies the materialism of a Louis Althusser. It's an old story. While in prison in Italy during the 1930s, Antonio Gramsci wrote that "the claim (presented as an essential postulate of historical materialism) that every fluctuation of politics and ideology can be presented and expounded as an immediate expression of the structure, must be contested in theory as primitive infantilism". Marxism, he contended, "is itself a superstructure...the terrain on which determinate social groups (for example, the proletariat; for another, the bourgeoisie) become conscious of their own social being". The bourgeoisie survived, he said, because its intellectuals had done their job and made capitalism seem natural. Gramsci's very career, and especially the career of his writings after his death, illustrates the importance of mere non-material ideas.
And certainly Lenin, who established in 1902 the Bolshevik line against an "economism" such as that of Karl Kautsky, believed that ideas were necessary to inflame the working class to action. He asked, What is to be done? and answered: do not wait for the material conditions of the workers to cause the workers to attain spontaneously the idea of revolution. Least of all in Tsarist Russia. On the contrary, he wrote with fervent italics: "Class political consciousness can be brought to the workers only from without, that is only from outside the economic struggle...The social democrats (by which he meant at the time the revolutionary socialists like himself) must go among all classes of the population; they must dispatch units of their army (of ideas, observe) in all directions."
Yet from 1890 to 1980 or so, all the best people in the social sciences and many of the best on the arts side were materialists, even when anti-Marxist. From Left to Right, the ideas of positivism and behaviourism and economism ran the social-scientific show. Among Samuelsonian economists, it still does. In A Farewell to Alms: A Brief Economic History of the World
(2007), the decidedly non-Marxist economic historian Gregory Clark settles in one sentence the matter about the non-materialist sources of bourgeois behaviour in Britain c.1700: "there is...no need to invoke such a deus ex machina" as a change in the idea of kingship or of church governance or of the bourgeoisie. No religion or political theory, please: we're demographic historical materialists. Thus Engels had claimed that "interests, requirements, and demands of the various classes were concealed behind a religious screen". Natch.
Such evidence-poor side remarks signal the historiographic rhetoric prevalent in the period 1890-1980, and which persists in some places, that a human's consciousness changes with every change in the conditions of her material existence, and only with such changes. So Émile Durkheim in his Elementary Forms of Religious Life
(1912) argued that ritual, not doctrine, was the heart of religion because ritual performed the latent function of unifying a society. After all, what else does the history of ideas prove? It proves that ideas don't matter, and that unifying a society must be the point of religion - not all that nonsense about, say, a god who died. Look at the history of Stoicism or Protestantism, or the welfare state, or the history of liberalism or mathematics or feminism. All of them, obviously, were motivated largely, probably exclusively, by material causes. Interests. Money. Profit. The birth rate. Surely.
The 20th century's faith in cost and benefit is touching, and an economist can hardly rule it out of court. Yet the materialist assigns before the scientific trial begins a zero weight to words and rhetoric and identity and creativity. He demands instead numbers and interest and matter and Prudence Only. The opponents of ideas as causal are what modern Marxists call with a sneer "vulgar" Marxists - people wanting passionately to be seen as materialists, tough-minded behaviourists, positivists, quantitative, "evidence based", every single time, regardless of the common sense or the historical evidence.
Yet surely the American Constitution, as the historian Bernard Bailyn argued recently, was a creative event in the realm of ideas - and its economic origins are easily exaggerated. And surely, as the historian Jonathan Israel asserts, "the Atlantic democratic revolutions of the later eighteenth century stemmed chiefly from a general shift in perceptions, ideas, and attitudes", a "revolution of the mind". The abolition of slavery, an idea once advocated merely by a handful of radical churchmen and the Baron de Montesquieu, played in the 1820s and 1830s a role in British politics, and later of course a much bigger role in American politics.
The American politics had little to do with the North's material interests and a lot to do with cheap printing interacting with evangelical Christianity. As Abraham Lincoln said on being introduced to Harriet Beecher Stowe, the author of Uncle Tom's Cabin (1852): "So you're the little woman who wrote the book that made this great war." Books can indeed make wars - Erskine Childers' spy novel, The Riddle of the Sands: A Record of Secret Service (1903), was no minor influence on the Anglo-German naval rivalry. Socialist ideas and, at length, socialist reality spread after the disappointed revolutions of 1848 in congresses and party meetings and manifestos. Various nationalisms had spread across Europe in reaction to Napoleon's material conquests, but then were matured in poetry and songs of risings and in the screeds of exiles resident in London. Talk, talk, talk. Ideas matter.
Take for example the most important secular event since the domestication of plants and animals: the rise of income per head in the world from $3 per day in real Chicago prices in 1800 to $30 worldwide nowadays - and to more than $100 a head per day in bourgeois places such as Britain and Japan. Your great, great, great, great, great grandmother had one dress for Sunday, one for the week. A few pounds of potatoes each day, a little milk, an occasional scrap of meat, one wool shawl. A year or two of elementary education, if lucky and in a society with literacy. At birth, she had a 50-50 chance of dying before she was 30 years old. Perhaps she was a cheerful sort, and was "happy" with illiteracy, disease, superstition, periodic starvation and lack of prospects. But she subsisted at the level of the average poor woman in Dhaka or Dakar today, and had no expectation that her descendants would do any better.
Economists and economic historians have tried manfully (in more ways than one) to explain the Great Fact of $3 to $100 per day with a grimly Calvinist production function. "Accumulate, accumulate!" declared Marx in 1867. "That is Moses and the prophets." The bourgeois economists have agreed. A rise in output per head must depend, they all declare, on capital per head wrung from savings or from profitable overseas trade or from exploitation of poor people at home or abroad. It's a material matter of energetics, you see, under the first law of thermodynamics. In the sweat of your brow, or of some black person's. Get used to it.
And yet repeatedly since the 1950s, the Calvinist function has failed as science. Material capital, piling up brick on brick, or even BA on DPhil, explains little of our $100-a-day riches. The economist William Easterly has labelled the Calvinist materialism as "capital fundamentalism", the conviction that if Ghana has received billions in foreign aid since 1971 and mainland China not a cent, then of course Ghana should be a great economic success and China a failure. The maths say so. And yet the maths are wrong. What then?
Innovation - not investment or trade or exploitation - caused the Industrial Revolution. That is, the production function leapt up and up and up, from human ingenuity. Plate glass. Reinforced concrete. Modern universities. Ideas. Look around you.
And the ingenuity and innovation came from a Bourgeois Revaluation, a shift about 1700 in favour of our friends of the middle class, beginning on a big scale in Holland and increasingly imitated by the English. John Lilburne, one of the gentry-origin, merchant-radicals of London (he was born in the royal palace at Greenwich), a Leveller of the Civil War, saw it in 1653 as a law of God and England that "no man...may be put to answer for anything but wherein he materially violates the person, goods, or good name of another". Leave us alone, milord, unless we steal.
By 1669, the Dutch cloth merchant Pieter de la Court was declaring that "a power of using their natural rights and properties for their own safety ('the pursuit of happiness' soon became the usual phrase) ... will be to the commonalty ... an earthly paradise: for the liberty of a man's own mind, especially about matters wherein all his welfare consists, is to such a one as acceptable as an empire or kingdom". No aristocratic glories, please; we're bourgeois, and merely wish the liberty to pursue happiness.
In 1690, an English merchant to the Ottomans, Dudley North (himself from an aristocratic family), wrote in an even more modern and bourgeois way that "there can be no trade unprofitable to the public, for if any prove so, men leave it off; and wherever the traders thrive, the public, of which they are a part, thrives also". Therefore, laissez-faire (make what you want, free of regulation), as the early 18th-century French theorists of bourgeois life such as Pierre de Boisguilbert began to say, and later laissez-passer (trade what you want). Shakespeare sneered at traders and inventors and farmers. In 1753 Samuel Johnson and in 1776 Adam Smith and in 1815 even Jane Austen did not.
Cosmology has been thrown into confusion recently by the discovery of dark matter and dark energy. So here. Ideas are the dark matter and dark energy even of economic history, darknesses ignored for a century or so (1890-1980). To be able to see in the dark we will need a "humanomics", one that combines the arts and sciences instead of setting them at war for funding. Ethical (and unethical) talk runs the world. One-quarter of national income is earned from sweet talk in markets and management. Perhaps economics and its many good friends should acknowledge the fact.
To explain the new dignity and liberty of the middle class in north-western Europe, and to explain the success it brought to the modern world, the historians and social scientists and many of the teachers of English will need to moderate their fervent ideology of materialism - though of course without denying material forces. It is not a rule of scientific method that an economic subject, such as revolutionary economic growth, must have an exclusively economic explanation. It didn't in the period 1600-1800, with its great consequence to 2010.
The Victorian travel writer and sceptic, Alexander Kinglake, suggested that every church should bear on its front door a large sign, "Important If True". So again here. Economic history faces no more important question than why industrialisation and the reduction of mass poverty first started, and especially why it continued. The continuation made us gigantically richer and freer and more capable of human achievement than our ancestors. The latest continuation - located most spectacularly in China and India, of all surprising places - shows that the whole world can be so. But we won't understand it, and we may even set about killing it, if we insist on materialism, and economism, and accumulate, accumulate. Vive la humanomics.