The Birth of Modern Economics


        Politics and Economics first separated into recognisably different spheres of activity in Ancient Athens with the birth of Democracy.   Politics was a labour of men, Economia was a labour of women.   Democracy disappeared after its first flowering in Athens and its seeds have taken 2,500 years to find fertile soil again in the human imagination.   Globally we are still in the early stages of the second flowering of democratic politics.   We have barely begun on a similar development with respect to economics.

        Europe is the birthplace of modern economics under whose theories the world now lives.   If we are to be specific then we must look to Scotland, the country on the western edge of Europe, that gives the world Adam Smith (1723-1790), the "father of modern economics".   The beginnings of modern economics in Smith came at the time in the 18th century when Scotland had just lost its political identity and was becoming subsumed in the politico/economic entity that is still known as Great Britain.   Modern economics is born in one of the poorest countries in Europe.   It is both poor in natural resources and bankrupt through its attempt to join the empire builders by investing all its wealth in Central America at Darien (Panama).   Nevertheless it is a country, at that time, rich in genius, giving to the wider culture of modern times world class philosophers, scientists, medical discoveries and inventions that mock its economic poverty.

        It is the genius of the English language which allows this flowering in the sciences and philosophy to arise in England's  thorniest of neighbours.   Since the 18th century Scotland has fought a cultural battle to retain its own spiritual identity whilst part of a bigger entity to which it has contributed on all levels.  In this battle it has transformed its Mars forces ( which until that time had led to continuous bloodshed between Scotland and England) into passionate battles in the realm of ideas.   The main battle was fought in the sphere of education and continued into the second half of the 20th century when the original impulses of Scotland's pedagogical ideal, "the democratic intellect", were lost sight of in the aftermath of the ferocious turmoil of the 20th century, not least by Scotland itself.

        The ideal of the democratic intellect came to expression in Goethe, the deep thinking well-rounded human being, whose thought could encompass body, soul and spirit, whose range covered art and science.   The pedagogical aim in Scotland was to create, on the basis of commonsense and the exercise of "muscular" thinking, the opposite of narrow-mindedness, blinkered specialism, and  similar characterological dispositions that are the enemies of clear minded consideration of truth.   It was democratic also in practical terms (in the male line) in that the poor and the rich sat side by side in the classroom in recognition of  the fact that genius knows  no class boundaries.  Thus Scotland and England, united politically and economically, have in fact functioned for nearly 300 years with different educational and legal systems and a different spiritual inheritance.

        In 1999 a Parliament returned to Scotland allowing it to enter the new millennium as the youngest European democracy.  However an old  country like Scotland cannot become young again except spiritually.   This it can do, as can every country, when it's spiritual "capital", education, is freed from all political control.   Education is the spiritual "bank";  the "interest rate" for a country and the wider world can be phenomenal, as Scotland proved in the 18th century.   Beginning in the 19th century and continuing apace in the 20th century  the interest rate has slumped as political life has gained more and more control of  the various spiritual "banks".   Scotland itself is now no better than any other country that cannot distinguish the right to education, a beautiful and worthy creation of political life, from the content of education, something in which  politics  can only interfere as a social evil, undoing the good it has created in the right to education.

        Every country in Europe is now facing the spiritual crisis of how to retain individuality whilst being subsumed in larger politico/economic entities.   In fact, the current stage of clumping together into geographical economic blocs is the last dying spasms of outmoded economic thinking in the face of  World Economy.   It is the coming generations with their world consciousness who will need to find the peaceful way out of the economic battlefield that this outmoded thinking insists is "economic science".

        Out of the milieu of economic poverty, loss of political identity, high pedagogical ideals, a love of freedom and a flowering of genius  as a gift of the English language, the desire to understand economics as a science was born.   At the same time, however, as Scotland gave to the world the father of modern economics it acted as a gateway for the first ethnic cleansing under conscious economic theory.   Its Gaelic speaking (Celtic) population were forcibly cleared from their glens to make way for theoretically more economic inhabitants of the mountains  than people.   In Scotland's case, sheep.  This "reifying" of the human being differs from slavery which at that time (18th century) was just beginning to be seen as morally repugnant and unworthy of civilised humanity.   The Clearances were not a trade in human beings but a "price" of economic improvement, an unleashing of a cruel inhumanity under the guise of economic "science".   It is as if the inhumanity contained in the concept of slavery, hearing its death knell in the trade in human beings,  found a new and more subtle expression.   The flawed perception of humanity alive in the slave trade lives on in economics in the form of  "the cost (price) of labour"  which as a concept is a moral offspring of Clearance (ethnic cleansing) and slavery.   This cruel "scientific" inhumanity that began to inhabit economic science  has continued to haunt European and World civilisation and inflict incalculable suffering.

        The experience of giving birth to the beginnings of modern economics and almost simultaneously experiencing the inhumanity of applied economic theory has left a deep wound in the Scottish psyche, in a country that could not, economically speaking, stand on its own feet, yet was a fertile ground for the science, engineering, design and technology, and human sweat that built the modern world.   In Scotland today this manifests as a desire to develop true social conscience and the continual frustration of this by the political and economic spheres.   Thus the Leo forces of this people, now also unable to express themselves on the physical battlefield and unable to achieve victory in the expression of the heartfelt universal humanity voiced by their national poet  (Robert Burns, 1759-1796) leads them to have the highest incidence of heart related disease in Europe, and the highest heroin related deaths of their young people in Europe.  (Morphine being the heart remedy for hearts under "attack").  This attack on the social heart forces of European humanity is expressed in every European country through the heroin deaths of its young people.

        Every country, even part of a people has its time and its contribution to make to the good and healthy progress of human kind, but every people has also a spiritual destiny that brings it face to face with its own contribution to "man's inhumanity to man".   Real understanding of what is contained in this study cannot arise without this ability to meet in one's own Folk history "man's inhumanity to man".    The free individual spirit, out of love of humanity, can set off on this path towards the Folk Spirits of Humanity, which is, in essence, a redemptive path, by meeting with courage "man's inhumanity to man" within his/her own soul and his/her own Folk Soul.   In this meeting, the Spirit of the Times is the guide.

        The Folk Spirit is not an expression of nationalism, rather is nationalism a failure to rise in spirit to the sphere of the Folk Spirits.   In the world of the Folk traditions and music of Europe one finds the common themes with which the Folk Spirits have inspired the peoples.   In this world today, and this is particularly so among young people, there lives a cooperative working of the Folk Spirits of Europe not yet expressed in political or economic forms.   There harmonious music is made, not through reduction to a common denominator but through mutual appreciation of diversity and through the universal medium of music and the word which allows one to become the other, to feel the others cultural identity as one's own.    In this cultural sphere free giving and receiving goes on, continually enriching the experience of individuals and amplifying it without loss of individual folk identity or disharmony.

        This impulse proceeds at grassroots level and is worldwide, so that peoples of the world hear the joyous meeting of Africa with Europa, of Europa with The Americas, Asia with Australasia, Africa with Russia etc., in the folk tradition.   This is the working of  World Economy and the Celtic Folk Spirit, a Spirit that once watched over  the diverse tribes and people of Europe.   It still carries around the world the true spiritual meaning of the brotherhood and sisterhood of humanity as expressed by the Time Spirit through the Folk Spirits.   It is at the level of politics and economics that this harmony in diversity is not heard.

        We must now rise in the right way, in the right Spirit to an understanding of how the Folk Spirits have played their part in World Economy and how the development of Cosmic Economy arises out of this.   It is this ability to rise to the level of Europa, the harmonious community of Folk Spirits in Europe where modern economics was born, which enables us to see the beginnings of Cosmic Economy.

        The spiritual world does not speak German or English, the genius of every language is capable of giving to its people the spiritual revelations of the Time Spirit, Michael.   But it is the service of the Celtic Folk Spirit to Michael that, in Central Europe, allows truly human economy to arise.   In the following two sections these developments are looked at from the spiritual perspectives of South and North Europe.

        The Position Paper in World Economy presents the same central facts from a completely different perspective and in purely conceptual form.  It is hoped that it might prove an aid to post-graduate students of the Social Sciences attempting to prise open the gates of Academia in the cause of constructive and truly human Social Sciences.

"We are the preparers of the preparers."

Rudolf Steiner, in the context of World Economy.

"It's coming yet, for a' that,
That man tae man the world o'er
Shall brithers be, for a' that."

The Rosicrucian Robert Burns in the context of World Economy

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