Photograph from cover of Small Is Beautiful 1973.

Ernst Friedrich "Fritz" Schumacher (16 August 1911 – 4 September 1977) was an internationally influential economic thinker, statisticianW and economist in BritainW, serving as Chief Economic Advisor to the UK National Coal BoardW for two decades.[1] His ideas became popularized in much of the English-speaking worldW during the 1970s. He is best known for his critique of Western economies and his proposals for human-scale, decentralized and appropriate technologies. According to The Times Literary SupplementW, his 1973 book Small Is Beautiful: a study of economics as if people mattered is among the 100 most influential books published since World War IIW.[2] and was soon translated into many languages, bringing him international fame. Schumacher's basic development theoriesW have been summed up in the catch-phrases Intermediate SizeW and Intermediate Technology. In 1977 he published A Guide for the Perplexed as a critique of materialisticW scientismW and as an exploration of the nature and organization of knowledge. Together with long-time friends and associates like Professor Mansur HodaW, Schumacher founded the Intermediate Technology Development Group (now Practical Action) in 1966.

Early life[edit | edit source]

Schumacher was born in BonnW, GermanyW in 1911. His father was a professor of political economyW. The younger Schumacher studied in Bonn and BerlinW, then from 1930 in EnglandW as a Rhodes ScholarW at New CollegeW, OxfordW,[1]and later at Columbia UniversityW in New York CityW, earning a diplomaW in economics. He then worked in business, farming and journalism.[1]

Economist[edit | edit source]

Protégé of Keynes[edit | edit source]

Schumacher moved back to England before World War IIW, as he had no intention of living under NazismW. For a period during the War, he was internedW on an isolated English farmW as an "enemy alien." In these years, Schumacher captured the attention of John Maynard KeynesW with a paper entitled "Multilateral Clearing" that he had written between sessions working in the fields of the internment camp. Keynes recognised the young German's understanding and abilities, and was able to have Schumacher released from internment. Schumacher helped the British governmentW mobilise economically and financially during World War II, and Keynes found a position for him at Oxford UniversityW.

According to Leopold Kohr's obituary for Schumacher, when his paper "was published in the spring of 1943 in Economica, it caused some embarrassment to Keynes who, instead of arranging for its separate publication, had incorporated the text almost verbatim in his famous "Plan for an International Clearing UnionW," which the British government issued as a White PaperW a few weeks later."[3]

Adviser to the Coal Board[edit | edit source]

After the War, Schumacher worked as an economic advisor to, and later Chief Statistician for, the Allied Commission|British Control CommissionW which was charged with rebuilding the German economyW.[1]From 1950 to 1970 he was Chief Economic AdviserW to the National Coal BoardW,[1]one of the world's largest organizations, with 800,000 employees. In this position, he argued that coalW, not petroleum, should be used to supply the energy needs of the world's population. He viewed oil as a finite resourceW, fearing its depletion and eventually prohibitive priceW, and viewing with alarm the fact that, as Schumacher put it, "the richest and cheapest reserves are located in some of the world's most unstable countries"[4]

His position on the Coal Board was often mentioned later by those introducing Schumacher or his ideas. It is generally thought that his farsighted planning contributed to Britain's post-war economic recovery. Schumacher predicted the rise of OPECW and many of the problems of nuclear power.

Thinking outside the box[edit | edit source]

In 1955 Schumacher travelled to BurmaW as an economic consultant. While there, he developed the set of principles he called "Buddhist economicsW," based on the belief that individuals needed good work for proper human developmentW. He also proclaimed that "production from local resources for local needs is the most rational way of economic life." He traveled throughout many Third WorldW countries, encouraging local governments to create self-reliant economiesW. Schumacher's experience led him to become a pioneer of what is now called appropriate technology: user-friendlyW and ecologicallyW suitable technology applicable to the scale of the community. He founded the Intermediate Technology Development Group (now Practical Action) in 1966. His theories of development have been summed up for many in catch phrases like "intermediate sizeW," and "intermediate technology." He was a trusteeW of Scott Bader CommonwealthW and in 1970 the president of the Soil AssociationW.

E F Schumacher was influenced by Mahatma Gandhi, while delivering the Gandhi Memorial Lecture at the Gandhian Institute of Studies at Varanasi (India) in 1973, described Gandhi as the greatest 'People's Economist.'. Schumacher identified Gandhi as the people's economist whose economic thinking was compatible with spirituality as opposed to materialism.[5]

By the end of his life, it can be said that Schumacher's personal development had led him very far afield from the ideas of John Maynard Keynes. Keynes, second only to Adam SmithW, is widely regarded as the most influential modern orthodoxW economist. In contrast, Schumacher is one of the most widely recognized heterodoxW economists.

Schumacher as writer[edit | edit source]

Schumacher wrote on economics for London's The TimesW and became one of the paper's chief editorial writers]]W. At this post he was assigned the somewhat uncomfortable task of compiling information for the obituary of John Keynes many years before the event of his death. He also wrote for The EconomistW and ResurgenceW. He served as adviser to the India Planning CommissionW, as well as to the governments of ZambiaW and BurmaW — an experience that led to his much-read essay on "Buddhist Economics."

The 1973 publication of Small is Beautiful: a study of economics as if people mattered, a collection of essaysW, brought his ideas to a wider audience. One of his main arguments in Small is Beautiful is that we cannot consider the problem of technological production solved if it requires that we recklessly erode our finite natural capital and deprive future generations of its benefits. Schumacher's work coincided with the growth of ecologicalW concerns and with the birth of environmentalismW and he became a hero to many in the environmental movementW and community movementW.

In 1976, he received the prestigious award Prix Européen de l'Essai Charles Veillon for Small is Beautiful

His 1977 work A Guide for the Perplexed is both a critique of materialisticW scientismW and an exploration of the nature and organization of knowledge.

Later life and posthumous recognition[edit | edit source]

As a young man, Schumacher was a dedicated atheist, but his later rejection of materialist, capitalist, agnostic modernity was paralleled by a growing fascination with religion.[6][7] His interest in Buddhism has been noted. However, from the late 1950s on, CatholicismW heavily influenced his thought. He noted the similarities between his own economic views and the teaching of papal encyclicals on socio-economic issues, from Leo XIIIW's "Rerum NovarumW" to Pope John XXIIIW's "Mater et MagistraW", as well as with the distributismW supported by the Catholic thinkers G. K. ChestertonW, Hilaire BellocW and Vincent McNabbW. Philosophically, he absorbed much of ThomismW, which provided an objective system in contrast to what he saw as the self-centered subjectivismW and relativismW of modern philosophy and society.[8] He also was greatly interested in the tradition of Christian mysticismW, reading deeply such writers as St. Teresa of AvilaW and Thomas MertonW. These were all interests that he shared with his friend, the Catholic writer Christopher DerrickW. In 1971, he converted to Catholicism.

Schumacher gave interviews and published articles for a wide readership in his later years. He also pursued one of the loves of his life: gardening. He died during a lecture tourW of a heart attackW on 4 September 1977, in Switzerland]{w|Switzerland}}.

The Schumacher CircleW organizations were founded in his memory. They include the Schumacher CollegeW in TotnesW, DevonW, the New Economics InstituteW (formerly called the E. F. Schumacher SocietyW) founded in New EnglandW, the Soil AssociationW and the New Economics FoundationW in the UK.

Schumacher's personal collection of books and archives are currently held by the New Economics InstituteW library in Great Barrington, MassachusettsW. The New Economics Institute continues the work of E. F. Schumacher by maintaining a research library, organizing lectures and seminars, publishing papers, developing model economic programs, and providing technical assistance to groups all for the purpose of linking people, land, and community to build strong, diverse local economies.

Schumacher's Teachings[edit | edit source]

Homo viator[edit | edit source]

"It is when we come to politics," Schumacher insisted, "that we can no longer postpone or avoid the question regarding man's ultimate aim and purpose." If one believes in God one will pursue politics "mindful of the eternal destiny of man and of the truths of the Gospel". However, if one believes "that there are no higher obligations", it becomes impossible to resist the appeal of Machiavellianism "politics as the art of gaining and maintaining power so that you and your friends can order the world as they like it"(2). Once one accepted that man was created by God with a designated purpose, politics, economics and art had value only for the end of helping man reach a higher plane of existence, which should be his goal (2).

By the end of the fifties Schumacher had reached the conclusion that man was homo viator (a pilgrim on a journey). He believed that it was the failure to recognize this fact which led to society's ills (2).

Three Culprits[edit | edit source]

For Schumacher there were three main culprits, that had all been corrosive agents in a world which had lost sight of individual responsibility and a world bound to the parameters of realism and science. These were Freud, Marx and Einstein. Freud had made perception subjective through his teaching that perception was subject to the complex interplay of the ego and the id, literally rendering it self-centered. This led inevitably to a change of attitude in human relations where self-fulfillment took precedence over the needs of others. Marx, by seeking a scapegoat in the bourgeoisie, had replaced personal responsibility with a hatred for others. His fault lay in his blaming of others for problems with society. Einstein had supposedly undermined belief in absolutes with his insistence on the relativity of everything. The application of 'relativity' in all other fields including morality, led to rejection of moral codes and responsibility (2). (Of course, Einstein's actual theory of relativityW was strictly limited to physics, and its correctness has been thoroughly verified by experiment.)

Three Planes of Thought[edit | edit source]

In May 1957, in a talk he called 'The Insufficiency of Liberalism' he gave an exposition of what he termed the "three stages of development". The first great leap, he said, was made when man moved from stage one of primitive religion to stage two of scientific realism. This is the stage most modern men tend to be in. A few move to the third stage in which one can find, in the lapses and deficiencies in science and realism, that there is something beyond fact and science. He called this stage three. The problem, he explained, was that stage one and stage three appear to be exactly the same to people stuck in stage two. Consequently, those in stage three are seen as having had some sort of a relapse into childish nonsense. Only those in stage three can understand the differences between the three stages and between stage one and stage three in particular.

Labour[edit | edit source]

In 1955 Schumacher traveled to Burma as an economic consultant. While there, he developed the principles of what he called "Buddhist economics", based on the belief that good work was essential for proper human development and that "production from local resources for local needs is the most rational way of economic life." (1)

The following four quotes from Schumacher are said to exemplify his ideas:

  1. "From the point of view of the employer, it [work] is in any case simply an item of cost, to be reduced to a minimum if it cannot be eliminated altogether, say, by automation. From the point of view of the workman, it is a 'disutility'; to work is to make a sacrifice of one's leisure and comfort, and wages are a kind of compensation for the sacrifice."(2)
  2. "From a Buddhist point of view, this is standing the truth on its head by considering goods as more important than people and consumption as more important than creative activity. It means shifting the emphasis from the worker to the product of work, that is, from the human to the sub-human, surrender to the forces of evil."(2)
  3. The Buddhist view, "takes the function of work to be at least threefold": "to give a man a chance to utilize and develop his faculties; to enable him to overcome his egocentredness by joining with other people in a common task; and to bring forth the goods and services needed for a becoming existence."(2)
  4. "to organize work in such a manner that it becomes meaningless, boring, stultifying, or nerve-racking for the worker would be little short of criminal; it would indicate a greater concern with goods than with people, an evil lack of compassion and a soul-destroying degree of attachment to the most primitive side of this worldly existence".(2)

Appropriate technology[edit | edit source]

Interwoven with his ideas of labor were Schumacher's ideas about what would later be called appropriate technology. His two basic development theories were Intermediate Size, and Intermediate Technology.

To impose Intermediate Size on a national economy Schumacher suggested superimposing on large-area states a cantonalW structure of modest size so that vast industrial concentration (with all this entails in imbalance, ineptitude, and diseconomies of scaleW) becomes not only unnecessary but also impractical and inefficient. (1)

Intermediate Technology would be a byproduct of the cantonal structure. Once a development district is 'appropriately' reduced, it becomes possible to fulfill a society's material requirements by means of less expensive and simpler equipment than the costly, computerized, labor-saving machinery necessary for satisfying the massive appetite for the remedial transport and integration commodities without which a very large modern market community cannot exist. Though this means a reduction in productivity, it does not mean a reduction in even the highest humanely attainable standard of living. (1)

Putting it differently, the reduced efficiency of intermediate technology provides the same amount of goods, but at a higher cost in labor. However, since higher labor cost and longer working hours means simply that the desired level of production can be achieved only by full rather than partial employment of the available labor force, they represent socially no additional cost at all. They are, in fact, a benefit. It is unemployment, defined by Schumacher as the degrading saving of manpower through the inappropriate use of advanced machinery, which is the prohibitive cost which no society can afford to pay in the long run. Furthermore the unemployment caused by excessive technological progress will inevitably lead to the revolt of the unemployed (1).

See also[edit | edit source]

References[edit | edit source]

  1. 1.0 1.1 1.2 1.3 1.4 Biography on the inner dustjacket of Small Is Beautiful
  2. The Times Literary Supplement, October 6, 1995, p. 39
  3. Leopold Kohr."Tribute to E. F. Schumacher", in Satish Kumar (ed.), The Schumacher Lectures, Harper & Row, 1980.
  4. Daniel Yergin. The Prize, Simon & Schuster, 1991, p. 559.
  5. Gandhi Foundation "Surur Hoda (1928-2003)". Gandhi Foundation. 7 September 2008.
  6. Diana Schumacher. "Who was Fritz Schumacher?"
  7. Julia Forster. "E. F. Schumacher"
  8. Charles Fager. "Small Is Beautiful, and So Is Rome: The Surprising Faith of E. F. Schumacher", Christian Century, April 6, 1967.

Selected bibliography[edit | edit source]

  • Small Is Beautiful: A Study of Economics As If People Mattered (1973, ISBN 0-06-131778-0); a 25th anniversary edition was published (ISBN 0-88179-169-5)
  • A Guide for the Perplexed (1977, ISBN 0-224-01496-X; still in paperback, ISBN 0-06-090611-1)
  • This I Believe and Other Essays (1977; reissued, ISBN 1-870098-66-8)
  • Good Work (1979, ISBN 0-06-013857-2)

Further reading[edit | edit source]

Books about E. F. Schumacher[edit | edit source]

External links[edit | edit source]

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Keywords appropriate technology advocates, development specialists, environmental economics, green thinkers, heterodox, sustainability advocates economists, people
Authors RichardF
License CC-BY-SA-3.0
Location Bonn, Germany
United Kingdom
Ported from (original)
Language English (en)
Related 0 subpages, 15 pages link here
Aliases E.F. Schumacher
Impact 2,949 page views
Created July 16, 2011 by RichardF
Modified April 30, 2024 by Kathy Nativi
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