From: ronda@ais.org (Ronda Hauben)
Subject: Basic Questions of Political Economy
Date: Thu, 19 Nov 92 16:30:43 EST
Organization: UMCC
Keywords: political economy, foundation, greeks, aristotle
X-Newsreader: TIN [version 1.1 PL6]

  Aristotle points to the importance of looking at the earliest
explanation of a phenomena, to its origin and development, if one
is interested in a clear understanding of it.

  He wrote in Politics: 
  "He who thus considers things in their first growth adn origin,
whether a state or anything else, will obtain the clearest view of 
them."
               from Jowett trans. vol 1, p. 179

   Jean Jacques Rousseau in his article "A Discourse on Political
Economy" which was written for Diderot's encyclopedia, goes back to
the greek origins of the terms "political economy."

   He explains:
   "The word Economy or Oeconomy, is derived from oikos, a house,
and vouos, law, and meant originally only the wise and legitimate
government of the house for the common good of the whole family.~
    from "A Discourse on Political Economy, edition published by 
    Henry Regency Co. for the Great Books Foundation, Chicago, Ill, 1949,
    p. 110 (I have left off the accents on the greek letters 
    as I had no way to indicate them - r)

    So Rousseau is showing the origin of the term oeconomy or economy as
the "law of the house for the common good of the whole family."

    He then goes on and distinguishes between two senses of the 
word economy, the economy that is concerned with ones family, which
Rousseau terms "domestic" or "particular" economy, and the economics
that is concerned with the "government of the great family" which
has to do with civil government.  He terms this "political economy".

   He then goes on and points out that the father and his family 
have common interests, whereas that same assumption cannot be made
with government officials and the public or poltiical economy of 
a nation. The father, Rousseau points out, "can see everything for
himself," while the civil government depends on the eyes of others
for all its information.

  Thus Rousseau shows that government has to be watched over to 
see that it is serving the social good, while the father in a family
can be relied on to serve the family good without the same kind of 
oversight.

  But both the father and the government, Rousseau maintains, are
charged with providing for the "peace and plenty" of the citizens
living under that government.

   Sir James Stewart, writing in the period before Adam Smith's
"Wealth of Nations" appeared, maintains that "What oeconomy is
in a family, political economy is in a state." (An Inquiry into
the Principles of Political Economy, p. 16). 

   Writing in the 17th and 18th centuries, during the days of 
the transition from feudalism to capitalism, there were a number
of people putting out economic articles, books and tracts, trying
to define the essential categories that would make it possible to
examine economic questions from a scientific point of view.

   On of these writers was Cantillion. He claimed the essential
questions that had to be considered in regard to politcial
economy were:
    1)What is wealth? (meaning social wealth, not private wealth)
    2)How does it originate?
    3)What are the causes which regulate its distribution among
the different classes of society, and determine its circulation not
only within the country but between one country and another.

    Many writers during this period were interested in countering
the notion that a nation's wealth was determined by the amount of
gold or silver it had. In place of this view, a number of writers
explained that the Wealth of a Nation consisted in the application
of labor to natural resources - i.e. in production. Adam Smith`s
book "Wealth of Nations" takes up to examine where social
wealth comes from and how it develops. The actual title of his
book is "An Inquiry into the Nature and Causes of the Wealth 
of Nations." (i.e. he is taking a broad question, not a narrow
question of the wealth of any single nation).

  The 1600's and 1700's provide many writers who give insight into
how to examine economic questions so that the process will be helpful
in providing for the necessities and conveniences of life for the 
population of a society.

  Several writers like Sir William Petty (in the 1600's in England)
and the economists in France in the 1700's in the days before the 
French Revolution, took up to determine how new wealth was generated
via the application of natural resources and labor.  These writers
applied the current scientific discoveries like that of Harvey
and the circulation of blood (as Quesnay in France did) to the 
question of how does circulation function in an economy - or 
Sir William Petty wrote works like "The Political Anatomy of Ireland"
applying the lessons from anatomy to analyzing the economy of Ireland.

  Sadly this scientific foundation seems to be lost in todays
writings on economics. Thus current economics seems to be detached
from the history of its origins and development and thus incapable
of helping shed any light on current economic problems.

  But the current economic troubles in much of the world require
a return to scientific categories and terms in order to have 
a way to shedding some light on how to move forward.  I propose
that this new newsgroup take seriously to look back to the history
of political economy and build on the insights and foundations
from the past toward determining how to shed light on the way forward.

                        ronda
                                 
                       ronda@umcc.ais.org




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