Aristotle on Economics and the Flourishing Life
BY HARVEY C. MANSFIELD
Harvard University and the Hoover Institution
This essay is the first in a series from the book Economic Freedom and Human Flourishing: Perspectives from Political Philosophy, edited by AEI’s Michael R. Strain and Stan A. Veuger. Check back in every week for additional essays in the series.
To introduce this large topic, it is fitting to consider Aristotle, for centuries “the master of those who know” (as Dante called him). By contrast to our thinking, Aristotle wrote comprehensively on both economics and the flourishing life. Modern economics makes its way without study of the “flourishing life,” which is one translation of what Aristotle meant by happiness. For him, as for common sense, happiness is the goal of ethics and politics, and ultimately of economics. At present, however, economics contents itself with the “pursuit of happiness” (to borrow from the Declaration of Independence), a catchall category that specifies at great length how to pursue but hardly at all what to pursue.
If we follow Aristotle’s method of beginning from what is familiar, we must begin from modern economics, which is more familiar to us than Aristotle. Every college student has taken, or should have taken, Economics 101, and those who have been deprived of this advantage have to learn what is taught in that course, perhaps more cheaply, perhaps not, in the School of Hard Knocks. Whether the study of economics is worth its cost is an example of a typical economic calculation, for economics is about calculation. A calculation is a deliberation that focuses on a number, a “metric,” of more, of a greater quantity. It avoids the question of how much more is needed before one can decide that one can stop acquiring and turn to enjoyment. Originally — and this is in Aristotle as well as in the founders of modern economics — economics supposed that it could define needs or necessities as opposed to surplus or superfluities. But necessities have a way of expanding from survival to comfort and from comfort to perfect assurance, so that it seems safer, and scientifically more exact, to consider them infinite and thus decline to define them.
Economics becomes the science of getting more without ever saying how much more. It is because of its exactness that science requires this vagueness. Economics must either be exact or fall silent; it disdains and rejects the possibility of an inexact statement that is merely probable and better than nothing. It may attempt to evade the difficulty by defining “probability” exactly. The result would be either a vague definition of exact or an exact definition of vague — which leaves the common sense “probable” in charge. So the science of more, of “growth,” drops the utilitarian posture that requires a definition of utility — possibly contestable — and turns to “preferences” that are admittedly quite subjective. Thus does the objectivity of economics require that it surrender totally to human subjectivity. And as the measuring of preferences becomes increasingly sophisticated, which means increasingly mathematical, economics becomes increasingly vague as to its end and continually further from defining the “flourishing life.”
But now economists have invaded political science . . . reducing political questions to economic ones.
At the same time the boundary of economics becomes increasingly uncertain. It used to be that economists, when pressured with a question hard to answer, would frequently resort to a boundary statement and say: “That’s a noneconomic question.” That distinguished an economist from a political scientist, who could never say “that’s a nonpolitical question” because politics admits no sanctuary from politics. But now economists have invaded political science, for example with game theory, reducing political questions to economic ones, and with the same increasing exactness that promotes increasing vagueness. It is true that many political scientists today, as distinguished from Aristotle, welcome these invaders as saviors of their science.
The discussion so far has a skeptical tone you will not find in Economics 101. But perhaps economics does have, despite its scientific pretensions, an end in view — and thus a contribution to the question of what is happiness. My father, a professor, used to rent his house in the summer to other professors who needed to live in the city he wanted to leave. This was an economic transaction. But he soon learned from hard experience that it was far preferable to rent to an economist than to a sociologist. His lesson was that economists believe in bourgeois virtue and sociologists do not. This is not a matter of calculation but of difference of habit, even of way of life, that he observed. Or it was calculation over the long term, never actually tested, that unkept promises and slovenly behavior would eventually be punished in this world: this is calculation not much different from virtue.
A problem of how to live can be seen within economic calculation. Which is better, to spend or to save? In the recent economic crisis, the American government passed a “stimulus” bill, meaning a stimulus on the consumer to spend. But it could also be said that in difficult times it is better to save — as many people did, not responding to the stimulus. Economic calculation might say that it is better sometimes to save, sometimes to spend, that to be rational one should have no predisposition for one or the other. But to spend or to save is a life choice; each way has habits of its own that are hard to change quickly in accordance with calculation, as when buying or selling a stock. A calculator is always ready to adjust and finds habit, which is fixed and not calculated, to be irrational (as in a way it is). Here, within economic rationality, we see two opposing ways of life, two opposite souls, the easy spender and the tightwad, both economic, but not determined solely by economic advantage.
To be happy is to be at rest, as we say, “sitting pretty.”
Turning to Aristotle, we see him considering ways of life with a view to which is best rather than calculation of what brings in more. More what, he wants to know, and how much more? For him the “pursuit” of happiness implies an end to the pursuit, since endless pursuit is futile and irrational. All human beings pursue happiness; everything else is instrumental to happiness and pursued because it brings happiness. Even virtue, though an end in itself and often involving sacrifice, is also pursued as the means to happiness. Virtue won’t, or at least shouldn’t, make you miserable, Aristotle says, somewhat optimistically. To be happy is to be at rest, as we say, “sitting pretty.” Those who scramble without end don’t know how to stop, don’t know how to enjoy. “Enjoy!” we say today in moments of respite; Aristotle would say that enjoyment (not relaxation) is the whole purpose of scrambling to get ahead. Relaxation is to gain respite from scrambling so that one can resume it refreshed, but enjoyment is satisfaction in an end attained.
The art or science of achieving happiness is political, and Aristotle calls politics the “master science,” the one that orders and rules over all other sciences, arts, and practices in a society. Even a free society is ruled in such a way that its parts are free and contribute to the whole of a free society. The “free market” studied and recommended by economics has to be the result of a political decision to establish and maintain it. In general, only politics can restrain politics. The free market needs to be sustained by “bourgeois virtue” taught in the schools and the family in consequence of a fundamentally political decision to lead a certain way of life and to live by its rules. The indispensable lessons of Economics 101 also need to be taught by the permission and favor of politics. What we call “civil society” similarly needs the good opinion and sponsorship of our rulers. Under the notion of “rule” Aristotle puts the main principles or principle of every way of life, so that politics promotes a definition of happiness, not just the means to undefined happiness. “Pluralism” in a society establishes a pluralistic society, a certain type of society distinctive in its ways from other, more prescriptive societies that it rejects and excludes. Aristotle’s “master science” provides a comprehensive role for politics, but it should not be confused with a program for Big Government.
Reading from Aristotle’s Ethics as well as his Politics, we see he maintains that virtue is the core of happiness. He means this in both a normative and a descriptive sense. Descriptively, every society has a virtue or cluster of virtues that it promotes as characterizing its way of life and defining its notion of happiness, often in his day the virtue of courage or martial spirit. But as every society claims that its prized virtue is best, Aristotle feels bound to judge normatively whether this claim is correct. For him there is no unbridgeable distinction between fact and value.
Now it is obvious that virtue cannot assure happiness. This is true not so much because we often witness the sad fact of virtue unrewarded — for virtue is its own reward (not always sufficient!) — but because we observe virtue thwarted for lack of means. Virtue stands in need of “equipment,” Aristotle says nicely. It needs good fortune or the gods’ blessing (implied in the Greek word for happiness, eudaimonia, well-blessed), and it needs wealth. One cannot be generous without wealth to give away. Here enters the need for economics as akin to a science of wealth-getting but distinct from it because economics needs to be limited. Aristotle does not hold to the purity of virtue understood as bringing no personal advantage (called “altruism”), but he does agree that wealth-getting is morally dangerous. It is essentially instrumental to virtue but can often become an end in itself regardless of virtue, Aristotle here in accord with Karl Marx. Money monetizes everything, as with the touch of King Midas, and thereby seems to dissolve all value except itself.
Virtue as the core of happiness is a habit, not a calculation. If you have to calculate the advantage from virtue, you are no longer being virtuous for the sake of virtue, which is no longer virtuous. You are merely behaving virtuously while others are watching, which is not enough. Virtue is in the intent as well as in the action. Yet again Aristotle admits that calculation can enter into virtue, for example, a generous person calculating how much to give or a courageous person reasoning in a situation of combat so as to avoid being rash. Virtue is divided into virtues, of which Aristotle names 11. An individual can practice one virtue without the others, and although it is desirable to have all the virtues, and Aristotle adds, to know you have them, this is rare.
Like individuals, societies (or, since “society” is a modern construct, political regimes, politeiai) tend to specialize in certain virtues. Indeed, regimes are necessarily biased in a certain direction, whereas a rare individual might have all the virtues. Regimes have laws that enshrine their characteristic virtues and make it difficult to adjust to new situations as they might do if they were more calculating. Most men and hence all peoples, because they have a character or type, resist change until they are compelled to change, and then they adopt and hold to the new regime. One revolution leads in time to another, not to an end of revolution — even though all revolution aims at being the final revolution. In the long view politics must recognize the limits to what can be achieved by politics, which means by human beings. The indefinite or infinite growth that modern economics dimly imagines as its goal is not viable, even if “growth” into nothing definite were intelligible as mere expansion. The same goes for the modern notion of progress or perfectibility, which today has dissolved into “change,” as if it were possible for change to occur except with respect to something that does not change. For if “America has changed totally,” how could you still call it “America”?
If you have to calculate the advantage from virtue, you are no longer being virtuous for the sake of virtue, which is no longer virtuous.
Within Aristotelian virtue there is a distinction characteristic of the Socratic tradition and very important for both economics and flourishing life. This is between the just and the noble. The just is what can be expected from citizens, one’s duty or obligation; it contains an element of compulsion although it is voluntary like all the virtues. Examples are paying one’s taxes or bills; payment is virtuous but expected and therefore not admired. Noble actions, however, go “beyond the call of duty,” as we still say; they contain an element of risk and might earn a medal. Modern morality dating from Thomas Hobbes wants to avoid this distinction and to make all morality more certain by considering all of it (typically) under the concept of justice as virtue to be expected. This move permits all morality to be more predictable and calculable, less subject to chance. Happiness in a flourishing life may be more attractive, more admirable, as in the classical gentleman, but homo economicus — the morality of man subject to the laws of economics — is more regular and dependable.
The morality of the modern economic man can be calculated together with his economic behavior.
The morality of the modern economic man can be calculated together with his economic behavior. In this calculation another distinction within Aristotelian virtue between intellectual and moral virtue can be overcome and the two combined. In the modern view, moral virtue comes under the rule of theory instead of being distinct from it. Moral theory takes the place of ordinary, unscientific praise and blame, and modern philosophers no longer make a point of rising above morality but stoop down to take charge of it. Happiness is regularized by being reduced to something less than the flourishing life of a gentleman or lady, let alone a philosopher — to a more attainable life such as bourgeois virtue. Bourgeois virtue has not been an unqualified success, however. It turns out that the morality that is more easily attained is also less satisfying, less interesting. A new concern for the boredom of bourgeois society arises, and ennui becomes the problem. Sociology with its critique of bourgeois happiness is born. Modern man would rather be “inner-directed” toward self-expression than calculate his self-interest in conformity with society’s norms. A version or perversion of ancient nobility comes to life again in the guise of the radical and the hippy, who in their separate lives concur to disdain the pettiness of bourgeois virtue.
Of the two parts of Aristotle’s virtue, the noble is more a problem for economics. The noble makes us resist economic advantage and the insistence of “incentives” (another modern concept). We often refuse what is presented to us as necessity when necessity no longer seems truly necessary. Economics expands necessity from minimum survival to the necessity of seeking a return on one’s money. The rich man cannot afford not to exploit the opportunities he sees. The poor and their advocates will question this sort of “necessity.” Also, what makes virtue noble is doing it for its own sake rather than for your private advantage. Yet Aristotle, still eschewing moral purity, says that virtue is for your advantage as well. Virtue makes you a better person, and perhaps a still better person if you realize that your virtue makes you better. For virtue is enhanced when aware of itself as the best kind of enjoyment. Similarly, the virtuous person does not seek pleasure, but he gets pleasure as a by-product of his virtue, taking a moderate pleasure in doing good and avoiding too much self-congratulation or superiority.
What is a better person? It is one with a better soul. Aristotle’s moral, political, and economic thought is based on the soul. In the best case the soul is well-ordered and harmonious, but in every case the soul is a human being’s individual self-government. The soul enables the individual to act and to reflect for himself, as opposed to the various determinants by which we are known and controlled by the various modern sciences, all of them denying or overlooking the soul. Hovering over us today, these sciences want to run our lives for us through the laws peculiar to each of them: laws of psychology, biology, chemistry, neurology, and — not least — economics.
We need a return to reason, to Aristotelian reason. The reason of economics is not empirical as it claims.
Much of today’s political science, soulless but not selfless, tries to imitate these more pretentious and more successful sciences. The soul, which Aristotle studied so well, stands in the way of these types of enslavement. It represents freedom in its various aspects: the freedom to resist necessity and nature (a freedom given to us by nature), the freedom to initiate action, the freedom to stop and reflect, the freedom to take satisfaction in oneself, and the freedom to blame oneself and feel shame. Human beings with souls fall in love and feel anger — two types of action that a calculating person never does and that the calculating sciences never know of.
We need a return to reason, to Aristotelian reason. The reason of economics is not empirical as it claims. It is based on the dubious presumption that human beings suffer in a condition of scarcity or necessity that will oblige them with their “preferences” (really, their necessities) to choose in ways that economists can predict and then control. This sort of reason begins in a dubious presumption that denies human freedom, and it dissolves, we have seen, in vagueness that fails to specify a reasonable goal of human life. Aristotle’s reason, by contrast, admits human necessities, for he was one of the founders of economics. But, because it is more empirical than economics by itself on the basis of human experience, it also seeks, through the soul, to come to terms with human nobility and freedom. Aristotle’s reason does its best to define the flourishing life, at its peak as well as in average, and measure the ordinary and the common by what is best and rare.
Check back in every week for additional essays in the series
