Conversable Economist

Tyler Cowen has conducted one of his thought-provoking and entertaining interviews in \”Abhijit Banerjee on Theory, Practice, and India\” (Medium.com, December 30, 2019, both podcast and transcript available). Among his other accomplishments, Banerjee was of course most recently a co-winner of the Nobel prize in economics last fall. The interview is worth consuming in full. As it says in the overview:

Abhijit joined Tyler to discuss his unique approach to economics, including thoughts on premature deindustrialization, the intrinsic weakness of any charter city, where the best classical Indian music is being made today, why he prefers making Indian sweets to French sweets, the influence of English intellectual life in India, the history behind Bengali leftism, the best Indian regional cuisine, why experimental economics is underrated, the reforms he’d make to traditional graduate economics training, how his mother’s passion inspires his research, how many consumer loyalty programs he’s joined, and more. 

A century ago, John F. Carter wrote an essay about “These Wild Young People’ by One of Them,” in the Atlantic Monthly (September 1920,  pp. 301-304, an excerpt is here, although as far as I know the entire essay isn\’t freely available online). It offers a useful reminder that complaints from young adults about the terrible world they are inheriting, so much worse than any previous generation ever inherited, are nothing new. Enjoy the 100 year-old version of the classic young-to-old intergenerational rant:

For some months past the pages of our more conservative magazines have been crowded with pessimistic descriptions of the younger generation, as seen by their elders and, no doubt, their betters. Hardly a week goes by that I do not read some indignant treatise depicting our extravagance, the corruption of our manners, the futility of our existence, poured out in stiff, scared, shocked sentences before a sympathetic and horrified audience of fathers, mothers, and maiden aunts – but particularly maiden aunts. …

I would like to say a few things about my generation.

In the first place, I would like to observe that the older generation had certainly pretty well ruined this world before passing it on to us. They give us this Thing, knocked to pieces, leaky, red-hot, threatening to blow up; and then they are surprised that we don\’t
accept it with the same attitude of pretty, decorous enthusiasm with which they received it, \’way back in the eighteen-nineties, nicely painted, smoothly running, practically fool-proof. \’So simple that a child can run it!\’ But the child could n\’t steer it. He hit every
possible telegraph-pole, some of them twice, and ended with a head-on collision for which we shall have to pay the fines and damages. Now, with loving pride, they turn over their wreck to us; and, since we are not properly overwhelmed with loving gratitude, shake their heads and sigh, \’Dear! dear! We were so much better-mannered than these wild young people. But then we had the advantages of a good, strict,
old-fashioned bringing-up!\’ How intensely human these oldsters are, after all, and how fallible I How they always blame us for not following precisely in their eminently correct footsteps! 

Then again there is the matter of outlook.. When these sentimental old world-wreckers were young, the world was such a different place … Life for them was bright and pleasant. Like all normal youngsters, they had their little tin-pot ideals, their sweet little visions, their naive enthusiasms, their nice little sets of beliefs. Christianity had
emerged from the blow dealt by Darwin, emerged rather in the shape of social
dogma. Man was a noble and perfectible creature. Women were angels (whom they smugly sweated in their industries and prostituted in their slums). Right was downing might. The nobility and the divine mission of the race were factors that led our fathers to work wholeheartedly for a millennium, which they caught a glimpse of just around the
turn of the century. Why, there were Hague Tribunals! International peace was at last assured, and according to current reports, never officially denied, the American delegates held\’ out for the use of poison gas in warfare~ just as the men of that generation were later to ruin Wilson\’s great ideal of a league of nations, on the ground that such a
scheme was an invasion of American rights. But still, everything, masked by
ingrained hypocrisy and prudishness, seemed simple, beautiful, inevitable.

Now my generation is disillusionized, and, I think, to a certain extent, brutalized, by the cataclysm which their complacent folly engendered. The acceleration of life for us has been so great that into the last few years have been crowded the experiences and the
ideas of a normal lifetime. We have in our unregenerate youth learned the practicality and the cynicism that is safe only in unregenerate old age. We have been forced to become realists overnight, instead of idealists, as was our birthright. We have seen man at his lowest, woman at her lightest, in the terrible moral chaos of Europe. We
have been forced to question, and in many cases to discard, the religion of our fathers. We have seen hideous peculation, greed, anger, hatred, malice, and all uncharitableness, unmasked and rampant and unashamed. We have been forced to live in an atmosphere of
\’to-morrow we die,\’ and so, naturally, we drank and were merry. We have seen the rottenness and shortcomings of all governments, even .the best and most stable. We have seen entire social systems overthrown, and our own called in question. In short, we have seen the inherent beastliness of the human race revealed in an infernal apocalypse.

It is the older generation who forced us to see all this … We are faced with staggering problems and are forced to solve them, while the previous incumbents are permitted a graceful and untroubled death. … A keen interest in political and social problems, and a determination to face the facts of life, ugly or beautiful, characterizes us, as it certainly did not characterize our fathers. We won\’t shut our eyes to the truths we have learned. We have faced so many unpleasant things already, – and faced them pretty well,-that it is natural that we should keep it up.

Now I think that this is the aspect of our generation that annoys the uncritical and deceives the unsuspecting oldsters who are now met in judgment upon us: our devastating and brutal frankness. And this is the quality in which we really differ from our predecessors. We are frank with each other, frank, or pretty nearly so, with our elders, frank in the way we feel toward life and this badly damaged world. It may be a disquieting and misleading ha.bit, but is it a bad one? We find some few things in
the ·world that we like, and a whole lot that we don\’t, and we are not afraid to
say so or to give our reasons. In earlier generations this was not the case. The young men yearned to be glittering generalities, the young women to act like shy, sweet, innocent fawns–toward one another. And now, when grown up, they have come to ·believe that they actually were figures of pristine excellence, knightly chivalry, adorable modesty,
and impeccable propriety. But I really doubt if they were so. …

The oldsters stand dramatically with fingers and toes and noses pressed against the bursting dykes. Let them! They won\’t do any good. They can shackle us down, and still expect us to repair their blunders, if they wish. But we shall not trouble ourselves very much about them any more. Why should we? What have they done? They have made us
work as they never had .to work in all their padded lives – but we\’ll have our cakes and ale for a\’ that. 

For now we know our way about. We \’re not babes in the wood, hunting for great, big, red strawberries, and confidently expecting the Robin Red-Breasts to cover us up with pretty leaves if we don\’t find them. We\’re men and women, long before our time,
in the flower of our full-blooded youth. We\’ have brought back into civil life some of the recklessness and ability that we were taught by war. We are also quite fatalistic in our outlook on the tepid perils of tame living. All may yet crash to the ground for aught that
we can do about it. Terrible mistakes will be made, but we shall at least make them intelligently and insist, if we are to receive the strictures of the future, on doing pretty much as we choose now. 

Insert a few references to some modern -isms–say, environmentalism, capitalism, militarism. racism, and sexism–and this essay from 1920 could be republished today. This doesn\’t make it wrong, of  course. The essay is a fair representation of one set of incomplete truths that each generation tells itself. At least some of the young, at least in a certain mood, are shocked, shocked, when they reach adulthood and discover that previous generations have let them down and the world still has problems. At least some of the middle-aged and old, at least in a certain mood, don\’t actually disagree with this insight that problems continue to exist, but they have a hard time viewing this discovery of the young as a profound or thoughtful insight. And so the generations go.

George Bernard Shaw (1856-1950) had this phrase carved into the mantelpiece of his living room: \”They say. What do they say? Let them say.\”

Rebecca Solnit is a writer who crosses the boundaries of history, politics, feminism, and social criticism. I especially enjoyed River of Shadows: Eadweard Muybridge and the Technological Wild West, which tells the story of the photographer who managed to capture high-speed motion in California in 1872 but also a meditation about the roots of Hollywood and Silicon Valley and the modern industrial economy.  A few years ago she wrote a short essay: \”How to Be a Writer: 10 Tips from Rebecca Solnit–Joy, Suffering, Reading, and Lots and Lots of Writing\” (Literary Hub website, September 13, 2016). It\’s a quick, fun read, but here are a few of her thoughts about writing that especially caught my eye:

Yes, we live in outrageous times. But we also live in a time when there is cachet in being the most outraged, kudos to being the most highly angered and offended, and eminence in being the most exceptionally shocked and appalled. When the rewards for dialing up the emotional level are high, other discourse can be drowned out. This blog, in its own small way, tries to model the virtues of civil discourse.

The story of Viner\’s draftsman was fairly well-known to economists in the generation before me, and passed on by word-of-mouth to some of my generation, but my sense is that is barely known at all to more recent cohorts. For the sake of keeping the story alive, it goes like this:

Back in 1931, Jacob Viner published an article on \”Cost Curves and Supply Curves\” (Zeitschrift für Nationalökonomie/Journal of Economics, pp. 23-46, available via JSTOR). In the article, Viner presented a version of a diagram that now appears in just about every introductory economics textbook: a figure that combines short-run average cost curves and a long-run average cost curve. For the uninitiated, the conceptual difference here is that in a short-run average cost curve, there are fixed costs usually described as the existing level of plant and equipment which can\’t be changed in the short run, so a firm can only change its short-term inputs like the number of workers hired. Thus, there is a different short-run average cost curve for each different level of preexisting plant and equipment. In a long-run average cost curve, however, all factors of production can be adjusted.

Here\’s a figure from Viner\’s paper. There are series of U-shaped short-run cost curves. They are tangent to the long-run average cost curve, labeled with AC and a darker line in the figure. The idea is to show that the difference between the choices firms face in the short-run, when they are locked into a certain level of plant and equipment, and the choices available to firms in the long run as plant and equipment adjust. The downward slope of what is labelled as the AC curve in the figure shows economies of scale–that is, as the quantity produced by the firm expands (horizontal axis), and firms invest in large amounts of plant and equipment, the average cost of production (on the vertical axis) will decline.

But there\’s a problem with the figure, which Viner discusses in a footnote. To understand the problem, 21st-century economists need to know that there was once a time before computerized graphics. In those long-ago days, researchers who wanted a graph turned to a skilled draftsman, who tried to combine instructions of the author with personal judgement and a French curve to produce the desired result.

Viner\’s draftsman was a mathematician named Y.K. Wong. Viner gave Wong the instructions to draw the figure show that the U-shaped short-run average curves should be tangent to the downward sloping long-run average cost curve (in the figure, AC). Moreover, Viner said that he wanted the point of tangency to happen at the bottom of each individual short-run AC curve.

These instructions were impossible for Wang to follow. For any U-shaped curve, the point at the bottom of the curve is tangent to a horizontal line. It\’s not geometrically possible for the point at the bottom of a U-shaped curve to be tangent to a downward-sloping line. However, Viner insisted that Wong draw the lines so that the very bottom of the U-shaped short-run average costs curves touched the long run AC curve.  This caused a problem, which Viner described in a footnote to his 1931 article (p. 36):

It may be noticed that at certain points the short-run ac curves are drawn so as to sink below the long-run AC curve. If the AC curve is interpreted as having significance only at the N points, this is of no consequence. But if the AC curve is interpreted as a continuous curve, this is an error. My instructions to the draftsman were to draw the AC curve so as never to be above any portion of any ac curve. He is a mathematician, however, not an economist, and he saw some mathematical objection to this procedure which I could not succeed in understanding. I could not persuade him to disregard his scruples as a craftsman and to follow my instructions, absurd though they might be.

Paul Samuelson adds a grace note to this story in his essay, \”Schumpeter as an Economic Theorist\” (reprinted in Paul Samuelson on the History of Economic Analysis: Selected Essays, edited by Steven G. Medema, Anthony M. C. Waterman, 2015):

As a younger man back in the 1930s and 1940s, Sidney Hook thought of himself as a \”communist without dogmas.\” He sought to differentiate his views from the cruelty of Soviet Communism and the crudeness of its propaganda. As he writes in his 1985 biography, Out of Step, he was viewed by at the time as a \”reasonable, intelligent, and critical-minded Communist.\” He argued later in life that his fundamental values never changed, but along the way, he stopped seeing socialism as a political vehicle for those values. In a memorable phrase, he wrote of his earlier years (p. 175):

I cannot absolve myself from the guilt of failure to exercise critical responsibility toward my own radical ideals. I was guilty of judging capitalism by its operations and socialism by its hopes and aspirations; capitalism by its works and socialism by its literature. To this day, this error and its disastrous consequences are observable in the judgment and behavior or some impassioned individuals, mostly young.

In thinking about what he and others meant by \”socialism,\” Hook wrote (pp. 599-601):

I cannot claim any special competence in economics, although I have read–not really studied–the great classical economists since Adam Smith. I believe I can say with justification that I was one of the few American \”Socialist intellectuals\” who read Marx\’s Capital closely but was drawn to socialism on moral grounds rather than economic ones. This I believe was true of all the leading Socialists of our time. Capital offered us evidence, so we believed, that the normal operation of a commodity-producing society rested on the exploitation of the worker. We did not realize what should have been evidence even before the Soviet economy confirmed it; that workers could be exploited in a collectivist society as well as in a free market economy–in the absence of free trade unions even more so–and that the distribution of social wealth could never be adequately accounted for in purely economic terms. As a group, although we were intensely interested in the economic questions of the day, we were indifferent to, and largely ignorant of, current-day economic theory. …

Because our support of socialism as an economy rested on moral grounds, the very meaning of socialism changed once we abandoned serious advocacy of collective ownership of all social means of production, distribution, and exchange. Since World War II, the famous Clause IV of the Constitution of the English Labour Part, which advocated complete socialization of the economy, has never been taken seriously–not by the Labour Party itself nor by the Socialist Parties of Germany, France, and Italy nor by most of the members of the Socialist International, including its American affiliates. The primary reason for this is that they were more wedded to political democracy than to any totally planned economy. In time, the term socialism seemed to have changed its meaning to signify the responsibility of the stage to intervene in the economy to provide a safety net for those willing and able to work but who find themselves unable to find employment or make ends meet when they do. All major political parties in Western countries seem committed to preserve the free-enterprise system at the same time as they call for some form of government intervention into the economy and support for the welfare state. …

I no longer believe that the central problem of our time is the choice between capitalism and socialism but the defense and enrichment of a free and open society against totalitarianism. … Most human beings in modern societies prefer a social order in which their choices are voluntary rather than coerced. But sustained economic hardships and deprivation  can in time erode the allegiance to freedom among large masses of people. That is why we cannot organize a society on the purely economic principles of a free enterprise society.

Hook also writes about a basic problem for socialist thinking, including his own–an insufficient level of attention paid to problems of incentives (p. 600):

Socialists, and I include myself among them, never took the problem of incentives seriously enough in the socialized sector of the economy, in which there was to be guaranteed tenure and in which government subsidies were to underwrite the failure of productivity to match the rising costs of the welfare state. The irony of the situation is that we used to worry about who would do \”the dirty work\” under socialism, a problem that never existed in a capitalist economy because the market seemed automatically to provide diligent candidates for the available posts. … What has happened in almost all socialist sectors of the economy is a decline in productivity, an erosion in the skills of craftsmanship and in the work ethic. …

Our error consisted, I believe, largely in the uncritical extrapolation we made from our own mode of living and earning a living. We were teachers, students, writers, artists, and professionals. Our vocation was freely chosen, and we assumed that inasmuch as there would be no problem of incentive for us, since we found self-fulfillment in our work, this would apply to everyone else. But until some way can be found to organize a society in which everyone\’s way of earning a living is at  the same time a satisfactory way of living his or her life, there will always be a problem of incentive. 

The passages quoted here resonate with me for a number of reasons. Here, I want to focus on the implications for what people mean today when they talk about \”socialism.\”

For example, when discussing \”socialism,\” it does seem to me that many people have turned away from the dictionary definition, which specifies state ownership or control of the means of production, and instead their idea of socialism focuses on government support for those who lack jobs or whose jobs don\’t pay enough to make ends meet.

It\’s common to hear of \”socialists\” (including some prominent Democratic politicians) who say that their preferred set of policies would be something closer to those common in western Europe, and perhaps especially in Scandinavian economies. Of course, using the standard dictionary definition of socialism as involving government ownership or control of the means of production, countries like Sweden, Denmark, and Norway are clearly capitalist. And many Americans who feel supportive toward the governments benefits provided by these countries tend to quail when confronted by specifics of these economies, like a national value-added tax at rates of 20% or more, low corporate income tax rates, embrace of international trade, and (in Sweden) vouchers for school choice.

I smiled ruefully at Hook\’s admonition that \”we cannot organize a society on the purely economic principles of a free enterprise society.\” This sentiment is often voiced by those who express sympathy with socialism. But it\’s a \”straw man\” argument–that is describe an argument that literally no one is actually making, and then knock that argument down and declare victory. I\’m unaware of any prominent economist, ever, of any political leaning, who has argued that free enterprise is sufficient for organizing a society. Anyone who makes such a claim is revealing (as Hook readily admits) that they have not actually studied economics.

Instead, economists have for decades argued that markets have been proven to have a lot of useful incentive properties when it comes to how a society addresses the necessary issue of production, distribution, and exchange of goods. Economists also recognize that pure free enterprise can lead to a range of problems: poverty and inequality, environmental issues, the appropriate social investment in education, health, technology, and more. Countries that call themselves \”socialist\” clearly have these problems, too. Thus, economics sees the problem of practical politics as how to arrange and constrain markets to support their strengths and to address their weaknesses.

From my own view, the idea that there is some group of people who believe in unfettered Darwinian survival-of-the-fittest free-for-all markets, while the alternative is to move to \”socialism,\” is playing games with terminology. After all, the US has had nothing resembling truly unfettered markets for decades, and has certainly not been organized \”on the purely economic principles of a free enterprise society.\” Indeed, it has been a favorite argument of some market-oriented thinkers to claim that the US economy has already been \”socialist\” for decades (for example, Milton Friedman often made this argument in the 1980s).

If \”socialism\” is going to be defined by a belief in democracy, it\’s important to remember that truly democratic countries operate through a mixture of popular voting along with various checks and balances, not by electing a dictator. Moreover, \”democracy\” contains its own black temptation, which is that some of those who claim to support democracy are also very quick to claim that democracy has been hijacked or fooled or corrupted when it doesn\’t lead to the result they prefer. But democracy is a process, not a result. If you only believe in democracy when it delivers your desired result, then you are a believer in the result, not the process, and you will tend to find excuses to jettison the inevitably imperfect real-world \”democracy\” when it produces outcomes that you deem incorrect or inconvenient. (As Hook noted, if you think that capitalism is the only form of oppression, or that countries which call themselves \”democratic\” don\’t oppress workers, you aren\’t paying attention.)

At the end of all these disputations, it seems to me that those who emphasize their support for big single-word terms like \”socialism,\” \”capitalism,\” or \”democracy\”L are pushed back to saying that they want \”the right kind\” of the system they favor. Some emphasize markets or capitalism, but \”the right kind\” of markets or capitalism. Some emphasize socialism, but of \”the right kind.\” Some emphasize democracy, but again \”of the right kind.\” In all of these settings, the qualifications about what \”the right kind\” means seems more important for making moral or practical judgment than the label that precedes it.

Being specific means digging into particulars, like the dramatic differences in how health insurance financing actually works in different countries, rather than just using labels like \”market\” or \”single-payer\” or \”socialized medicine.\” It means being transparent about incentives and tradeoffs, rather than assuming them away. It means not making big judgments about one abstract system by focusing heavily on the shortcomings of its real-world operations, while judging alternative choices based on theories and promises.

Back  in 1946, the writer and academic C.S. Lewis, author of the seven-book Chronicles of Narnia series starting with The Lion, The Witch, and the Wardrobe and the \”space trilogy\” series that starts with Out of the Silent Planet had an unlikely set-to with the scientist J.B.S. Haldane, who made foundational contributions to evolutionary biology and biostatistics, among other areas.

The difference between us is that the Professor sees the `World\’ purely in terms of those threats and those allurements which depend on money. I do not. The most `worldly\’ society I have ever lived in is that of schoolboys: most worldly in the cruelty and arrogance of the strong, the toadyism and mutual treachery of the weak, and the unqualified snobbery of both. Nothing was so base that most members of the school proletariat would not do it, or suffer it, to win the favour of he school aristocracy: hardly any injustice too bad for the aristocracy to practice. But the class system did not in the least depend on the amount of anyone\’s pocket money. Who needs to care about money if most of the things he wants can be offered by cringing servility and the remainder can be taken by force? This lesson has remained with me all my life. That is one of the reasons I cannot share Professor Haldane\’s exaltation at the banishment of Mammon from a sixth of our planet\’s surface\’. [Haldane was trumpeting his support for the Soviet Union.]  I have already lived in a world from which Mammon was banished: it was the most wicked and miserable I have yet known. If Mammon were the only devil, it would be another matter. But where Mammon vacates the throne, how if Moloch takes his place? As Aristotle said: `Men do not become tyrants in order to keep warm.\’ All men, of course, desire pleasure and safety. But all men also desire power and all men desire the mere sense of being `in the know\’ or `in the inner ring\’, of now being `outsiders\’: a passion insufficiently studied and the chief theme of my story. When the state of society is such that money is the passport to these prizes, then of course money will be the prime temptation. But when the passport changes, the desires will remain. And there are many other possible passports: position in an official hierarchy, for instance. Even now, the ambitious and worldly man would not inevitably choose the post with the higher salary. The pleasure of being `high up and far within\’ may be worth the sacrifice of some income. …

[W]as I attacking scientific planning? …[i]f you must reduce the romance to a proposition, the proposition would be … `Under modern conditions any effective invitation to Hell will certainly appear in the guise of scientific planning\’ …Every tyrant must begin by claiming to have what his victims respect and to give what they want. The majority in most modern countries respect science and want to be planned. And, therefore, almost by definition, if any man or group wishes to enslave us it will of course describe itself as `scientific planned democracy.\’ It may be true that any real salvation mus equally, though by hypothesis truthfully, describe it self as `scientific planned democracy.\’ All the more reason to look very carefully at anything which bears that label.

As regular readers know, I\’m generally a believer that international trade can be and often is a win-win situation, with benefits to the economies of all of the countries involved. But supporters of free trade have certainly had own lapses into overstated purple prose. One of my favorite purple prose statements along these lines was made by John Bowring in 1841: \”Jesus Christ is Free Trade, and Free Trade is Jesus Christ.\”

What was the context for this remarkable claim? David Todd gives a useful overview of Bohring\’s career in \”John Bowring and the Global Dissemination of Free Trade,\” published in the Historical Journal (2008: 51:2, pp. 373-397, available via JSTOR). Here\’s an overview from the introduction of Todd\’s piece (footnotes omitted):

[H]ow free ideas spread in practice around the globe in the mid-nineteenth century has received relatively little attention.

The extraordinary career of John Bowring (1792-1872), author, editor, and Board of Trade official, may illustrate several key aspects of that process of global dissemination. Bowring was an indefatigable and cosmopolitan propagator of free trade. In the aftermath of the 1830 Revolution in France, he toured dozens of cities there in the hope of making free trade \’vibrate\’ and spread like a \’fire\’ in public opinion. He later participated in the foundation of the Anti-Corn Law League in Manchester and propounded free trade policies in Bern, Rome, Berlin, Brussels, Cairo, Batavia (Jakarta), Bangkok, and Shanghai. In 1856, as British plenipotentiary in the Far East, he ordered the bombardment of Canton to enforce the rights of foreign merchants to enter the city. The decision triggered the Arrow War (1856-60), eventually resulting in Ch\’ing China\’s full opening to Western trade.

Bowring\’s endeavours demonstrate that the global dissemination of free trade was an eminently practical process that required deliberate agency and material support from institutions. His extraordinary mobility, his capacity to harangue foreign merchants and journalists, and the generous salaries paid to him by the British government were important factors–possibly more important than the intellectual impact of international trade theory–in the spread of liberal ideas about trade. He collected information or proselytized in more than thirty countries on three continents, and authored or edited more than forty works, consisting primarily of translations, reports on foreign trade policies, travel accounts, and pamphlets concerned with the international circulation of commodities, ideas, and individuals. As befits such a global career, his papers are scattered among more than fifteen archive depositories in Europe and North America. …

The global reach of Bowring\’s labours also suggests a greater continuity than is usually recognized between the rise of liberal ideas about trade in Europe and their forceful implementation in the extra-European world. Dissemination entailed reformulation in accordance with political and cultural contexts. In Western Europe, Bowring used a politically liberal rhetoric to woo public opinion. In less liberal countries such as Germany and Egypt, he sought to persuade absolute rulers and civil servants of the benefits of freer international communications. And in East Asia, he embraced \’gunboat diplomacy\’ to obtain the lifting of restrictions on foreign trade. \’Qui veut la fin veut les moyens\’, Bowring quipped to his adversaries, in Europe as well as in Asia. He resorted to different means in different circumstances. Yet his goal was everywhere the removal of international trade barriers. …

Despite the flexibility of his methods, Bowring pursued the same goal from Bordeaux to Canton: the lifting of restrictions on the free movement of commodities, ideas, and travellers. This goal became increasingly intertwined, in Bowring\’s mind, with the spread of British \’influence\’ – a word he used to describe his exertions in France and Egypt as well as China. Support for free trade lobbies on the European Continent and the opening of East Asian markets by gunboats may be construed as two facets of the same policy. The dissemination of free trade should be considered not only as a practical, but also as a global and continuous process, changing in intensity according to local military, political, and cultural conditions.

But although Bowring was a fervent advocate for free trade, readers during this Christmas season will be relieved to hear that he was not actually blasphemous on the subject.  R.K. Webb describes Bowring\’s then-unconventional Unitarian beliefs in \”John Bowring and Unitarianism,\” published in Utilitas (1992, 4:1, pp. 43-79). Webb writes:

For more than fifty years, John Bowring was active in Unitarian affairs. Indeed, the totality of Bowring\’s efforts give him some claim to have been the most prominent of Unitarian laymen. No one was more assiduous in attending Unitarian meetings, in taking the chair, in opening bazaars, in giving speeches on Unitarian occasions, whenever he was in Britain. … 

Truth and liberty were watchwords, even code words, for nineteenth­- century Unitarians. Truth, which embraced the emerging discoveries of science as well as critical findings about the Bible and sacred history, also meant religious truth, which those Unitarians who thought deeply about it saw as progressive revelation, as it might emerge from experience and the findings of science and scholarship. …

The liberty to which Unitarians were devoted was in the first instance the religious liberty for which they and their Dissenting forerunners came increasingly to contend in the eighteenth century. Going beyond the mere toleration written into law, they argued for a true marketplace of ideas, in religion as in everything else, an ideal to which the Established Church was a continuing reproach, the worse for the number of its adherents who were in substantial doctrinal agreement with the liberals but demeaned themselves by subscribing to what the rational Dissenters saw as outmoded and constricting formu­laries. The passion for liberty nurtured by the ambition of religious equality carried over into every form of social and political agitation­: antislavery, free trade, freedom of contract, parliamentary reform.

Webb and Bowring seem to agree that Bowring was clearly a Unitarian first and a Benthamite free trade second–but that he didn\’t see any contradiction between the two.  Webb quotes a report from the Bolton Chronicle, June 19, 1841:

Referring to the parable … of the Good Samaritan, [Bowring] compared the Anti-corn law league . . . to that benevolent wayfarer. But not content with this alleged comparison, he proceeded, in the  warmth of his Unitarian zeal, to pronounce the following words,-\’Jesus Christ is Free Trade, and Free Trade is Jesus Christ.\’ The awful and impious declaration was loudly cheered by a batch of Unitarian heathens upon the stage, who manifestly delighted in the opportunity of applauding such audacious irreverence.

Webb adds: \”In reply, Bowring denied that he had spoken irreverently. Born of religious parents and religiously educated, he said, \’if in the question of free trade he felt deeply interested, it was because he   believed it to be intimately associated with religious truth and the exercise of religious  principles …\’\”  (quotation from a follow-up story in the Bolton Chronicle, June 26, 1841).

As David Todd notes in his essay: \”The spread of free trade within early nineteenth-century British society, for example, owed a great deal to the religious reinterpretation of market laws by \’evangelical\’ Christians.\” I find myself wondering if it\’s possible for a 21st century people to insert themselves into a mindset in which putting free trade and Christianity side-by-side makes a kind of humorous sense, rather than just sounding like an over-the-top non-sequitur.

The article does not seem especially well-known today, but it is the source of a couple of the most common quotations from Charles Dickens about \”political economy,\” as the study of economics was usually called at the time. Early in the piece, Dickens wrote: \”Political Economy was a great and useful science in its own way and its own place; but … I did not transplant my definition of it from the Common Prayer Book, and make it a great king above all gods.\” Later in the article, Dickens wrote: \”[P]olitical economy is a mere skeleton unless it has a little human covering and filling out, a little human bloom upon it, and a little human warmth in it.\”

But more broadly, the article is of interest because Dickens, telling the story in the first person, takes the position that in thinking about a strike taking place in the town of Preston, one need not take the side either of management or labor. Instead, Dickens writes, one may \”be a friend to both,\” and feel that the strike is \”to be deplored on all accounts.\” Of course, the problem with a middle-of-the-road position is that you can end up being hit by ideological traffic going in both directions. But the ability of Dickens to sympathize with people in a wide range of positions is surely part what gives his novels and his world-view such lasting power. The article goes into a fair amount of detail, and can be read on-line, so I will content myself here with a substantial excerpt.

Here\’s a portion of the 1854 essay by Dickens:

\”ON STRIKE\”

Travelling down to Preston a week from this date, I chanced to sit opposite to a very acute, very determined, very emphatic personage, with a stout railway rug so drawn over his chest that he looked as if he were sitting up in bed with his great coat, hat, and gloves on, severely contemplating your humble servant from behind a large blue and grey checked counterpane. In calling him emphatic, I do
not mean that he was warm; he was coldly and bitingly emphatic as a frosty wind is.

\”You are going through to Preston, sir?\” says he, as soon as we were clear of the
CharPrimrose Hill tunnel.

The receipt of this question was like the receipt of a jerk of the nose; he was so short and sharp.

\”Yes.\”

\”This Preston strike is a nice piece of business!\” said the gentleman. \”A pretty piece of business!\”

\”It is very much to be deplored,\” said I, \”on all accounts.\”

\”They want to be ground. That\’s what they want to bring \’em to their senses,\” said the gentleman; whom I had already began to call in my own mind Mr. Snapper, and whom I may as well call by that name here as by any other. *

I deferentially enquired, who wanted to be ground?

\”The hands,\” said Mr. Snapper. \” The hands on strike, and the hands who help \’em.\”

I remarked that if that was all they wanted, they must be a very unreasonable people, for surely they had had a little grinding, one way and another, already. Mr. Snapper eyed me with sternness, and after opening and shutting his leathern-gloved hands several times outside his counterpane, asked me
abruptly, \” Was I a delegate?\”

I set Mr. Snapper right on that point, and told him I was no delegate.

\”I am glad to hear it,\” said Mr. Snapper. \”But a friend to the Strike, I believe?\”

\”Not at all,\” said I.

\”A friend to the Lock-out?\” pursued Mr. Snapper.

\”Not in the least,\” said I,

Mr. Snapper\’s rising opinion of me fell again, and he gave me to understand that a man must either be a friend to the Masters or a friend to the Hands.

\”He may be a friend to both,\” said I.

Mr. Snapper didn\’t see that; there was no medium in the Political Economy of the subject. I retorted on Mr. Snapper, that Political Economy was a great and useful science in its own way and its own place; but that I did not transplant my definition of it from the Common Prayer Book, and make it a great king above all gods. Mr. Snapper tucked himself up as if to keep me off, folded his arms on the top of his counterpane, leaned back and looked out of the window.

\”Pray what would you have, sir,\” enquire Mr. Snapper, suddenly withdrawing his eyes from the prospect to me, \”in the relations between Capital and Labour, but Political Economy?\”

I always avoid the stereotyped terms in these discussions as much as I can, for I have observed, in my little way, that they often supply the place of sense and moderation. I therefore took my gentleman up with the words employers and employed, in preference to Capital and Labour.

\”I believe,\” said I, \”that into the relations between employers and employed, as into all the relations of this life, there must enter something of feeling and sentiment; something of mutual explanation, forbearance, and consideration; something which is not to be found in Mr. M\’CulIoch\’s dictionary, and is not exactly stateable in figures; otherwise those relations are wrong and rotten at the core and will never bear sound fruit.\”

Mr. Snapper laughed at me. As I thought I had just as good reason to laugh at Mr. Snapper, I did so, and we were both contented. …

Mr. Snapper had no doubt, after this, that I thought the hands had a right to combine?

\”Surely,\” said I. \” A perfect right to combine in any lawful manner. The fact of their being able to combine and accustomed to combine may, I can easily conceive, be a protection to them. The blame even of this business is not all on one side. I think the associated Lock-out was a grave error. And
when you Preston masters—\”

\”I am not a Preston master,\” interrupted Mr. Snapper.

\”When the respectable combined body of Preston masters,\” said I, \” in the beginning of this unhappy difference, laid down the principle that no man should be employed henceforth who belonged to any combination—such as their own—they attempted to carry with a high hand a partial and unfair impossibility, and were obliged to abandon it. This was an unwise proceeding, and the first defeat.\”

Mr. Snapper had known, all along, that I was no friend to the masters.

\”Pardon me,\” said I; \” I am unfeignedly a friend to the masters, and have many friends among them.\”

\”Yet you think these hands in the right?\” quoth Mr. Snapper.

\”By no means,\” said I; \” I fear they are at present engaged in an unreasonable struggle, wherein they began ill and cannot end well.\”

Mr. Snapper, evidently regarding me as neither fish, flesh, nor fowl, begged to know after a pause if he might enquire whether I was going to Preston on business?

Indeed I was going there, in my unbusinesslike manner, I confessed, to look at the strike.

\”To look at the strike!\” echoed Mr. Snapper fixing his hat on firmly with both hands. \”To look at it! Might I ask you now, with what object you are going to look at it?\”

\”Certainly,\” said I. \” I read, even in liberal pages, the hardest Political Economy—of an extraordinary description too sometimes, and certainly not to be found in the books—as the only touchstone of this strike. I see, this very day in a to-morrow\’s liberal paper, some astonishing novelties in the politico-economical way, showing how profits and wages have no connexion whatever; coupled with such references to these hands as might be made by a very irascible General to rebels and brigands in arms. Now, if it be the case that some of the highest virtues of the working people still shine through them brighter than ever in their conduct of this mistake of theirs, perhaps the fact may reasonably suggest to me—and to others besides me—that there is some little things wanting in the relations between them and their employers, which neither political economy nor Drum-head proclamation writing will altogether supply, and which we cannot too soon or too temperately unite in trying to
find out.\”

Mr. Snapper, after again opening and shutting his gloved hands several times, drew the counterpane higher over his chest, and went to bed in disgust. He got up at Rugby, took himself and counterpane into another carriage, and left me to pursue my journey alone. …

In any aspect in which it can be viewed, this strike and lock-out is a deplorable calamity. In its waste of time, in its waste of a great people\’s energy, in its waste of wages, in its waste of wealth that seeks to be employed, in its encroachment on the means of many thousands who are labouring from day to day, in the gulf of separation it hourly deepens between those whose interests must be understood to be identical or must be destroyed, it is a great national affliction. But, at this pass, anger is of no use, starving out is of no use—for what will that do, five years hence, but overshadow all the mills in England with the growth of a bitter remembrance? —political economy is a mere skeleton unless it has a little human covering and filling out, a little human bloom upon it, and a little human warmth in it. Gentlemen are found, in great manufacturing towns, ready enough to extol imbecile mediation with dangerous madmen abroad; can none of them be brought to think of authorised mediation and explanation at home? I do not suppose that such a knotted difficulty as this, is to be at all untangled by a morning-party in the Adelphi; but I would entreat both sides now so miserably opposed, to consider whether there are no men in England above suspicion, to whom they might refer the matters in dispute, with a perfect confidence above all things in the desire of those men to act justly, and in their sincere attachment to their countrymen of every rank and to their country.