Last month the (En)Rich List was unveiled here at PGI. Coming out on top was E F Schumacher, one of the most influential men of the 2oth century. But who was Ernest Fritz Schumacher, and what makes him so important?
Fritz Schumacher was born in Germany 1911, in time to spend his childhood in the humiliated and economically constrained years after the First World War. He saw how his country’s circumstances were pushing politics in an extreme direction, and he moved to Britain to study at Oxford. When the Second World War began he was rounded up with many other Germans, and incarcerated in a makeshift prison camp. He had many friends, some of them quite influential, and they worked to secure his release. He saw out the remainder of the war working as a farm labourer, but throughout the whole period he was working on his economic ideas. His writing was getting noticed. On one occasion he took a day off from the farm to go to London to discuss one of his papers with John Maynard Keynes, the foremost economist of the age.
After the war Schumacher returned to Germany to work on the reconstruction, but was drawn back to England and eventually to a job as chief economist at the National Coal Board. This was a huge and very important nationalised industry, and he was to work here for the next two decades, working on energy policy, trade, employment, and much more besides.
It’s a little ironic that one of the most influential thinkers in sustainability worked in coal for most of his career, but this was before climate change was well understood. Schumacher became concerned about sustainability because he realised that coal and oil were non-renewable resources. The economy depended on them, but could not run forever on these energy sources. “Mankind has existed for many thousands of years and has always lived off income” he told a conference in Germany in 1954. “Only in the last hundred years has man forcibly broken into nature’s larder and is now emptying it out at a breathtaking speed which increases year to year.”
He began to develop an alternative economic theory, one that put people first and respected the environment. In 1955, seventeen years before the Club of Rome, Schumacher was recognizing the limits to growth:
“A civilization built on renewable resources… is superior to one built on non-renewable resources, such as oil, coal, metal, etc. This is because the former can last, while the latter cannot last. The former co-operates with nature, while the latter robs nature. The former bears the sign of life, while the latter bears the sign of death. It is already certain beyond the possibility of doubt that the ’0il-coal-metal-economies’ cannot be anything else but a short abnormality in the history of mankind – because they are based on non-renewable resources and because, being purely materialistic, they recognise no limits.”
Being a practical man as well as a theorist, Schumacher began working on some real-world responses. He championed organic agriculture and agro-forestry. He founded a charity to investigate intermediate technology – the term he coined for simple and empowering technologies that improved people’s lives, but that were still cheap and accessible. That charity is still at work, now called Practical Action. The philosophy of intermediate technology was also picked up worldwide – the Centre for Appropriate Technology , still active in the arid zone of Australia, is just one example of this kind of thinking.
It wasn’t until his sixties that Schumacher got around to writing the book that made him famous. He called it The Homecomers. The publisher agreed on all but the title, and discarded it in favour of Small is Beautiful, with the subtitle A Study of Economics as if People Mattered. It was published in 1973 and it became a global bestseller, connecting with a whole generation of students, with those pioneering voluntary simplicity, and the first shoots of the environmental movement.
Schumacher died just four years later, but the message was out and his influence is everywhere. The renewable energy revolution is underway, a little late perhaps, but just as Schumacher called for. He laid the foundations for the New Economics movement, and like Schumacher’s own catchphrase, the New Economics Foundation still have ‘Economics as if people and the planet mattered’ as their motto. The UK government has a localism agenda inspired by Schumacher’s ideas. Occupy protestors hold up ‘Small is Beautiful’ placards. The Schumacher Society are behind the wave of alternative currency experiments around the world. The Transition Towns movement has Schumacher’s fingerprints all over it. Appropriate technology is still a powerful idea in development. Organic farming, permaculture, New Urbanism, the Green Party, and countless other groups, organisations and movements owe a debt to Schumacher somewhere down the line. And that includes the postgrowth movement too.
It’s that legacy, the ideas that he inspired, that makes E F Schumacher so important. Many economists or thinkers put a name to something or explain something better. Others inspire an idealism that ends in oppression or chaos. Few economists have made such a positive, transformative, life-affirming contribution, and for that, E F Schumacher comes top of the (En)Rich List .
Jeremy blogs over at Make Wealth History.