Republicanism and the Eudaimonic Economy

What follows is a draft of a talk I gave at the International Society for MacIntyrean Enquiry conference in 2008. It lays out some of the themes I will be exploring in this blog.

The Aristotelian tradition can be restated in a way that restores rationality and intelligibility to our own moral and social attitudes and commitments.

With these words Alasdair MacIntyre ends After Virtue and begins Whose Justice? Which Rationality? Taking these words to heart, I shall try to describe some concrete steps we can take in this country to apply Aristotle’s practical philosophy to the political and economic challenges that we face.

In order to understand the nature of those challenges and the applicability of the Aristotelean tradition to them, we must first understand the problem of surplus. Our current economic difficulties notwithstanding, the United States is the wealthiest society that has ever existed. The uses to which we put our aggregate wealth and the way we distribute it will determine whether our descendants will live at peace or war, in a healthy environment or a toxic wasteland, and as citizens of a free republic or as subjects of an oligarchy.

Recent polls indicate that a majority of Americans believe that our country is headed in the wrong direction. I shall argue that Aristotle, or more precisely, the Aristotelean philosophical tradition, has something to tell us about what is wrong with our present course and what we can do to correct it.

Here are the main points that I would like to make today.

1. We live in a wealthy post-industrial society. 
2. We have developed a consumer economy to distribute our aggregate wealth. 
3. Our current patterns of distribution are not sustainable. 
4. Aristotelean practical philosophy offers an alternative pattern of distribution: instead of a consumer economy, a “eudaimonic” economy, i.e., one in which education and research displace consumer spending as the most important category of economic activity. 
5. Universal access to postsecondary education (UAPSE) is a feasible first step toward a eudaimonic economy. 

So, beginning with point #1, what do I mean by this? By ‘wealthy’ I simply mean that we have more than enough resources to provide for the needs of everyone in our society. In other words, we have a surplus to distribute.

Our great wealth is due to the resources at our disposal, certain national and cultural characteristics, and most importantly, due to our technology. We are not the first society to face the problems that arise when technological changes lead to great increases in wealth. Lewis Mumford has done extensive diachronic and cross-cultural research on the ways in which technological development and the economic growth that goes with it can be directed toward ends that are authoritarian and destructive or toward ends that disperse power and promote creativity. For example, ancient Egypt faced this cultural crossroads when it developed agriculture. Under the Pharaohs, a tiny ruling elite appropriated the surplus and decided how it would be distributed and what it would be used for. Under this system, very little of the surplus went to those who produced it; some went to arts and sciences, but most was expended on luxuries for the elite, monumental architecture, wars of expansion, and coercive control of the populace. Although our current system is less coercive and distributes wealth more widely than that of the Pharaohs, Mumford still draws some uncomfortable parallels between our society and theirs.

What I mean by “post-industrial” will require a bit more explication. I’m using the sociologist Daniel Bell’s account of post-industrial society. Bell defines “post-industrial” in terms of a society’s occupational structure. In a pre-industrial society most people spend their days extracting food or raw materials from the environment. In an industrial society most people spend their days fabricating material goods. In a post-industrial society, most people spend their days performing other kinds of work, much of which Bell subsumes under the rubric of “processing”. Here is a breakdown of the U.S. labor force in 2007, according to the CIA World Factbook:

• farming, forestry, and fishing 0.6% 
• manufacturing, mining, transportation, and crafts 22.6% 
• managerial, professional, and technical 35.5% 
• sales and office 24.8% 
• other services 16.5% 

Notice that the category of professional, managerial, and technical workers is the largest single category of occupation, and that these jobs require postsecondary education.

This brings us to what I mean by “a consumer economy” in point #2. In our post-industrial society, very few of us actually produce anything; most of us make our living by selling goods produced by others or by selling services. Moreover, most of the goods and services that most of us sell are ones that our great-grandparents either would have regarded as luxuries or had never even heard of during their lifetimes. We are of course buyers as well as sellers, and many of us spend more of our earnings on such products than we do on food or shelter.

The result is that our economy revolves around the consumption of these luxuries. We are told that the U.S. economy is “driven” by consumer spending, and reports of retail sales figures have become as much a part of the Christmas season as nativity scenes. It seems that, increasingly, we work more than we want to in order to be able buy goods and services we don’t really need from other people, so that they can buy goods and services they don’t really need from us. But not participating in this distribution pattern based upon the exchange of luxuries is not a realistic option for most of us, for those who fail to participate are denied secure access to even the most basic necessities.

Although consumer spending constitutes over 70% of our GDP, two other components also merit special attention for the role they play in distributing our aggregate wealth: the military-industry complex and the FIRE sector [finance, insurance, and real estate]. But due to time constraints I will focus mainly on the consumer economy.

So why are these patterns of distribution a problem? The benefits of living in a wealthy society are plain enough. But there are also costs associated with our current patterns of distribution, and that brings us to main point #3. The vast surplus wealth generated by the American economy is being used in ways that threaten our social and political institutions, the environment, and our national security. For this talk I’ll focus on threats to our political institutions.

Some alarming trends have emerged in the past 30 years. This was the economic model that guided policymakers from approximately 1947-1972: a growing economic pie, bigger portions for the poor and middle class, and for the rich, a smaller slice in relative terms, but in absolute terms their wealth was still growing. The 70s were a time of transition, and since 1981, we have discarded this model in favor of one in which the pie is still growing, but the rich are getting a bigger slice of that bigger pie, while the poor are losing ground and middle class are treading water (sometimes mixed metaphors are apt).

In his book Wealth and Democracy, Kevin Phillips explores this phenomenon and shows that the U.S. has become, as he puts it, “the most polarized and inequality-ridden of the major Western nations.” (xi)

Phillips writes,

Between 1979 and 1989 the portion of the nation’s wealth held by the top 1 percent had nearly doubled, from 22 percent to 39 percent. By the mid-nineties, some economists estimated that the top 1 percent had captured 70 percent of all earnings growth since the mid-seventies. (xiii)

. . . the unprecedented percentage gains made [during the 80’s and 90’s] by the top strata of 2000 . . . occurred alongside a relative stagnation of the middle class and a decline in the net worths of the bottom 60 percent of Americans. Real disposable (after tax) income for nonsupervisory workers peaked in the late 1960s. Debt taken on by the bottom two-fifths of the population rose so sharply that by 1995 their inflation-adjusted net worths had fallen below 1973 levels. (xviii)

Phillips argues that this concentrated wealth has fueled financial manipulation, speculation, and corruption. The many examples of this include the savings & loan bailout of 1989-1992, the technology stocks bubble of the 1990s, the accounting scandals of the early 2000s (Enron et al.), and the rising costs of political campaigns (we can add the recent real estate bubble to this list). Phillips also argues that, despite rhetorical support of free markets, government policies under Reagan, Bush, and Clinton have intervened on behalf of the wealthy.

Now we come to main point #4. What does Aristotle have to tell us about this? Applying Aristotlean ethical and political philosophy to the current situation generates both a diagnosis and a cure. The diagnosis is that our polity is degenerating from a republic into an oligarchy. The cure is that we must move away from our current consumption-oriented economy toward what I call a “eudaimonic economy”, that is, one in which education and research displace consumer spending as the most important component of our economy.

Let me elaborate. When I speak of Aristotelean ethical and political philosophy I am speaking not only of Aristotle’s works but also of the tradition of republican political thought that develops from the normative framework that Aristotle articulated.

According to Aristotle, eudaimonia – “the good life” -- is a life of contemplation or study, as opposed to a life devoted to the pursuit of pleasure, honor, or wealth. Achievement of eudaimonia is the ultimate end toward which human activity is directed, and the purpose of a legitimate state is to make eudaimonia possible for its citizens.

Applying the concept of eudaimonia to a post-industrial economy leads to the conclusion that a legitimate post-industrial state should direct surplus resources toward education and research to the greatest extent possible, thereby enabling its citizens to engage in contemplative pursuits (the arts would also merit support if eudaimonia is construed broadly). Let us suppose for the sake of argument that our economy may be called eudaimonic when 51% of working American citizens make their living from occupations that are related to education or research. Although education and research are increasingly important sectors of the U.S. economy, consumer spending is presently bigger both in terms of the share of GDP and in terms of the number of persons employed. Much of our surplus wealth is also directed toward the military-industrial complex and the financial sectors.

Now, what is the connection between eudaimonia and republicanism? Eudaimonia is the goal of a legitimate state. Aristotle and his republican successors theorized about the possible forms that a legitimate state might take, and which of those forms was most stable and least susceptible to corruption. According to this tradition, republic is the form of government that meets these criteria.

For example, here is the schema of Polybius, a historian and Stoic philosopher of the 2nd century BC:







Polybius classifies forms of government according to whether the ruling class consists of one, a few, or many, and whether the government is genuine (legitimate), meaning that it promotes the good life for all its citizens, or perverted, meaning that it promotes the good life only for the ruling faction. Thus there are six basic forms of government. Governments may also be defective in that they misunderstand what the good life really is, but that’s a separate issue.

According to Polybius, the six basic forms are unstable and tend to succeed each other in a cycle, as each genuine form (monarchy, aristocracy, democracy) degenerates into its corresponding perversion (tyranny, oligarchy, ochlocracy), which is in turn overthrown by the next genuine form. The way to get off this merry-go-round of instability is to form a republic, which is a mixed (or balanced) government that combines the strengths of the three genuine forms. We see here the germ of the idea of checks and balances.

Republican theorists also concern themselves with the qualities that individual citizens must have in order for the state to succeed. This is the idea of civic virtue, meaning the virtue of a person qua citizen, which is not necessarily identical with the virtue of a person qua human being. Personal independence and a willingness to separate personal interests from public affairs, and to subordinate the former to the latter, emerge as the key components of civic virtue. Republican theorists also recognize that in order for the state to be stable, the middle class must predominate. When the citizenry is polarized between the rich and the poor, community breaks down and the state is prone to civil discord or revolution.

The framers of our Constitution were strongly influenced by this tradition, but they were also influenced by another tradition of political philosophy that arose in the aftermath of the English Civil War, namely Liberalism. (By Liberalism, I mean the school of thought that includes contractarian theorists such as Hobbes, Locke, Rousseau, and Rawls, Utilitarians such as Bentham and Mill, and mainstream economists from Adam Smith to Milton Friedman.) Liberalism turned out to be much more congenial to the interests of the rising capitalist class than the older republican tradition and largely, but not completely, eclipsed the latter (cf. Sandel).

There are many interesting points of contrast between these two traditions, of which I shall mention only two: firstly, Liberalism denies that there is such a thing as the good life for human beings that a government should promote; according to Liberalism there are only various individual preferences, and government should not promote any one way of life over the others. Secondly, in place of the republican concern with civic virtue, Liberalism emphasizes the importance of secure property rights as a basis for a sound state.

So how would a eudaimonic economy help us avoid degenerating into oligarchy? Let’s take a closer look at the oligarchic threat.

Oligarchy is rule by a wealthy minority; at its worst, that minority is hereditary. The American republic has not remained static with regard to democracy and oligarchy. At any given point in its history, it has been in motion toward one or the other of these poles. During the Jacksonian period, it moved toward democracy. During the Gilded Age, it moved toward oligarchy: the railroad magnates, “robber baron” capitalists, and trusts were able to use their wealth to corrupt government at all levels, including the U.S. Senate and federal judiciary. The instituting of popular election of senators loosened their grip on the Senate, but the ideological imprint they left on the judiciary lasted well into FDR’s presidency.

From 1933-1980, America became increasingly democratic. Income disparity was reduced. Organized labor won the right to organize. Great gains were made in the areas of civil rights for minorities. Regulatory agencies and liability standards helped balance the interests of individual citizens and consumers against the interests of large enterprises. The airwaves were declared to be public property, and the FCC’s “fairness doctrine” allowed citizens with varying views to present their opinions on broadcast media. Control of the media was dispersed.

Unfortunately, our polity has lurched toward oligarchy during the past thirty years, a trend that has accelerated since 1980. Oligarchical moves have been disguised as attacks on “big government”. “Government is not the solution, it’s the problem!” Reagan said; “Starve the beast!” say reactionaries today. This period has seen a number of oligarchical trends, that is, trends that tend to concentrate power and wealth in fewer hands, and to reduce the accountability of those who exercise that power:

• Growing income disparity. 
• Weakened labor unions. 
• Weakened regulations concerning financial practices, environmental protection, product safety, and workplace safety. 
• Concentration of media ownership. 
• Rising costs for political campaigns. 
• De-funding of services for middle- and lower- income citizens, such as student aid, welfare, and healthcare for the poor. 
• International trade treaties that promote global capital but do not address labor or environmental issues, and the abuse of international trade treaties to circumvent national and local laws that do. 
• Decreasingly progressive taxation, which places the burden of supporting government disproportionately on the working poor and middle class, and exacerbates income inequality. 
• Weakening of the idea of a loyal opposition 

A eudaimonic economy would counter these oligarchic trends by redirecting resources away from concentrated wealth and the corrupt uses of it toward large-scale investment in education and research. Put simply, money that is spent on education and research is money that is not spent on political advertising, lobbyists’ salaries, etc. It is also not spent on wasteful consumer spending, or unnecessary military adventures and weapons systems, or speculative bubbles in securities or real estate. But there are less obvious ways in which education in particular is important. For a post-industrial republic, education is essential to two projects: the development of civic virtue and the preservation of the middle class.

The republican tradition has historically emphasized arms and property as bases of civic virtue and liberty, for these were thought to ensure the independence of the citizen. Those who were dependent upon others for livelihood or protection (dependent in the sense that these others could take away that livelihood or protection at will) were subjects, not citizens.

Concerning arms, the citizen soldier was the paradigm of courage for Aristotle, who also said that this sort of courage was the virtue most likely to be present in “the many”, and similarly Machiavelli thought that participation in the militia was essential to civic virtue. The second amendment of the U.S. Constitution is an echo of early modern republican debates about the dangers of a standing army and older ideas about the need for citizens to take part in their own defense. This is a timely topic, but unfortunately I cannot go into it further here. [I will go into it on this blog --MDR 2018]

Concerning property, in pre-industrial times, possession of a suitable amount of land and the equipment necessary to work it ensured economic independence. Lack of independence made one subject to one’s patron’s whims and led therefore to a servile condition. The ownership of a modest amount of land also bred virtue insofar as it required one to attend to the business of running one’s estate, and certain virtues such as liberality could not be exercised without a minimum of means. Such considerations influenced Thomas Jefferson’s ideal of a yeoman democracy, which is prefigured in Aristotle’s endorsement of democracies that limit the vote to husbandmen.

By the time of the founding of our republic, Liberal and republican thinkers agreed that securing property was a vital function of government (the most vital for Liberals, who, unlike republicans, were not concerned about the dangers of owning too much property). Securely held and fairly distributed real property (land) was also important insofar as it ensured the existence of a middle class, recognized by Aristotle and Cicero to be necessary for the stability of the state. Thus, in a republic, civic virtue goes hand-in-hand with a stable and harmonious class structure.

Home ownership is still an important component of the American Dream, but we can no longer conceive of independence as it was conceived in pre-industrial times, with its paradigm of the relatively self-sufficient gentleman or yeoman farmer who produced his own food on his estate and bore arms in a citizen’s militia. The technological basis for our society entails a complex interdependence among citizens who perform various specialized functions. Most of us do recognize this, implicitly or explicitly; those who live “off the grid” are exceptional.

This brings us again to education. For most Americans, economic independence, in the sense of being able to support oneself, is based on being able to exercise skills that are in demand. This means that having a profession or skilled trade, not land ownership, is the basis of economic security and relative independence, and having a profession or skilled trade usually requires post-secondary formation. Therefore, for most Americans, access to postsecondary education is necessary for the economic independence that is one of the bases of republican civic virtue.

Now for point #5. I’m not going to say much about the feasibility of UAPSE because, frankly, proving the feasibility of UAPSE is too easy to be interesting. (There are approximately 18 million college students in the U.S. Giving each of them a grant of $5000/year would cost less than what we are spending on the Iraq war, and this investment would pay for itself well before today’s freshmen retire.)

Moreover, UAPSE is only a first step toward a eudaimonic economy. So, in the time I have left, I’d like to briefly mention some other steps we can take to move in that direction. Here are some more things we could do to shift our surplus resources away from consumerism and the oligarchic concentration of wealth toward a eudaimonic economy:

• Fund more basic research. 
• Promote lifelong education. 
• Reduce teacher-student ratios. 
• Lengthen K-12 school years. 
• Expand offerings (not just university course offerings, but, e.g., foreign language instruction in elementary school). 
• Provide greater access to early education. 
• Increase after-school programs. 
• Provide more opportunities for professional development for educators. 
• Increase support for public libraries. 
• Provide adequate arts, music, and physical education in every school. 
• Shorten the work week. 

That last one is probably the least obvious. A shorter workweek would be conducive to a eudaimonic economy by facilitating lifelong education. Access to lifelong education is of little benefit if people do not have the time to make use of it. A shorter workweek would allow people the option of combining career-oriented work and study, and would enable them to upgrade their skills in response to technological changes. It would also counteract some of the harmful effects of consumerism upon the family by giving people more time to spend with their spouses and children.

America has experimented with large-scale investments in postsecondary education in the past, with the land-grant colleges and the G.I. Bill being perhaps the most conspicuous examples. The successes of these initiatives exceeded the expectations of their authors. The time has come for another round of massive investment in America’s human capital. The Aristotelean and republican tradition of practical philosophy offers a coherent normative rationale for doing so. Unfortunately, Liberalism, which is the dominant political ideology of our society, offers no such rationale and in fact supports the status quo. In order to achieve a eudaimonic economy, it may be necessary to overcome certain Liberal convictions about the role of government and the nature of political association.

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Copyright 2008 M. D. Robertson. The author grants permission to reprint, republish, or distribute this work with attribution for non-commercial purposes.

[Orthographical note: Macintyre and many others prefer "Aristotelian". I prefer "Aristotelean" on etymological grounds. --MDR 2018]