A Study of Economics as if People Mattered - Small Is Beautiful

Of late the bestseller lists have been filled with titles such as "Freakonomics" and "Predictably Irrational". Yet while the media fawns on these books, some people might find them strangely unsatisfying. It's not a matter of computing a statistic incorrectly or doing the analysis wrong. The problem is in the premise. The authors of these books are wrong from start to finish.

"If morality is the study of what people should do, economics is the study of what people actually do," proclaims Steven Levitt in Freakonomics. His definition is not found in any dictionary, but it makes it quite clear what he believes. Economics is a field with no bounds within human behavior. Economists have an absolute right to rule on what is right, proper, profitable, and rational, not only within business and finance, but everywhere. "I believe that any result can be achieved with the right incentive scheme," Levitt continues. So there you have it: people are simply tools, and it's up to economists to decide how these tools should be used.

If you find it odd that people should be changed to suit the desires of economics, rather than the other way around, then you might be ready for "Economics as if people mattered". E. F. Schumacher thinks very differently from the current crop of best-selling academics. For starters, he's clear about what economics can do and what it can't do. Economics can measure what is profitable, but that is only one aspect of human life. Humans are truly creatures with free will and independent desires, and cannot simply be made to live whichever way the authorities want.

Mainstream economists divide humans into producers and consumers. As consumers, consuming more will always be in our self-interest. As producers, efficiency is to be desired above all else. This breaks down, Schumacher says, as soon as we realize that producers and consumers are the same people with the same desires. Work need to be unenjoyable. Work that involves creativity, freedom, and love can be a good thing. Hence a sane economic theory doesn't mindlessly praise efficiency as a means of eliminating work. Likewise consuming more doesn't make things any better. When we consume in wasteful, unhealthy ways, we become less happy. A sane economic theory must acknowledge humanity's true desires, not invent imaginary ones.

Because most people are third-world and poor, "Economics as if people mattered" must focus on the poor, and Schumacher does exactly that. The past few decades have seen billions of poor people crammed into huge, unsafe, unhealthy cities all over the world. Wise business and government leaders have launched countless schemes to assist them, but success has been rare and failure common. Schumacher proposes a truly wise policy, focusing not on reshaping poor countries, but rather assisting them with the way of life they already have. Intermediate technology, concentrated at the level of families and villages, could actually raise standards of living without harming the social structure.

Lastly, Schumacher was a fore-runner of the modern environmental movement. He saw, early on, that industries which pollute the earth, endanger health, and use up limited resources cannot be sustained. In their place we need industry that respects the earth, and which has sustainability as a goal. Thankfully, much of what he envisioned is now becoming reality.

Overall, "Small is Beautiful" is one of the great underground books of the last century. Many of us know that our current way of life is wrong at a deep level. We are doing things on a huge scale, without accountability or forethought. It simply can't go on. As Schumacher says, "The environment is in revolt, and so is human nature." This book is a small but meaningful step towards sanity.

Prescient and Wise - that's how this book appears 40 yrs later after it was publised. Reading it - at a time in my life when I've left the rat-race - generates in me a certain kinship towards EFS. At times -for example, when he does the coal/nuclear comparison or some of his exploratory calculations- I find myself not exactly in agreement with him, but the gist of his message appeals very strongly.

The gist of his message is that our current metaphysics, or, rather, a lack of it, is the root cause of all our ailments. He deplores the popular and prevalent schools of thought in economics - one in which goods supersede people in importance - and says 'Economists themselves, like most specialists, normally suffer from a kind of metaphysical blindness, assming that theirs is a science of absolute and invariable truths, without any pre-suppositions'. This faulty metaphysics manifests itself in the decisions we take, decisions that do not take a holistic and long term view of our place on the planet, decisons that are taken with little deliberation, decisions that are bound to create havoc in the future. Do we need to run around doing meaningless tasks, keep ourselves busy making usless trinkets and contraptions so that the GNP looks good and proudly claim that we are progressing, or, should we consume less, own less and free ourselves for creative work? That's the choice we have to make.

If you don't have the time to go through the entire book -at times, it does appear to be a bit repetitive- you should read the following,
Chap 3 - Role of Economics
Chap 4 - Buddhist Economics (This has really nothing to do with Buddha; as EFS said, if he had named it as Christian Economics, then, nobody would have read it. Hence this name)
Chap 6 - The Greatest Resource - Education

Ernst Friedrich Schumacher was a German émigré to the UK and the US who, after a long and auspicious career as an academic, economist and advisor to numerous institutions, including the national coal board, found himself increasingly troubled by the short-comings of western economics and the implications of the continued adoption of the edict that dictates that increased profit, expansion and consumption was the only way forward for the human species.

Schumacher's contention was essentially that the planet Earth is a closed system and that infinite expansion within a closed system is an impossibility. Accordingly, he quite sensibly saw the continued exploitation of Earth's irreplaceable natural resources for economic purposes as a suicidal proposition. As a Christian and an economist, Schumacher felt that economics as a discipline had, like a tumour, metastasised and expanded far outside of what should have been it's legitimate area of concern; a development which he saw as detrimental to the environment, human dignity, and the continued existence of the human species.

"Small Is Beautiful: A Study Of Economics As If People Mattered" , published in 1973, is nothing less than this extraordinary man's attempt to analyse the state of affairs as it was then (and is now), redress the balance and to offer several alternative propositions to the school of economic thinking which dictates that "increased profit is best" and that "more is better".

There are so many important ideas in this book that I will never be able to do justice to them with this review. Suffice it to say, Schumacher's theories on "appropriate" and "intermediate" technology, the developing world, corporate structure, taxation and quantitive versus qualitative economics are so important that I think it should be taught within school curriculums the world over and made compulsory reading for world leaders before they take office.

It may yet turn out to be the most important book on economic theory ever written.

If you're searching for alternatives to the current system of economics, I think you will find this book important. I agree with an earlier reviewer that this reads like a 1960's time-capsule, but if you can translate just a bit in your head, it isn't a problem.

A bigger problem is that Schumacher has really written a book and a half: a fair amount of the material I feel belongs in Guide for the Perplexed but if you read "Small is Beautiful" first, it probably won't irritate you although I found it a bit distracting even when I appreciated his insight.

I think that Power and Prosperity: Outgrowing Communist and Capitalist Dictatorships is complementary reading.

Schumacher's approach to development economics is basically to get everyone a job:

"... the primary consideration cannot be to maximize output per man; it must be to maximize work opportunities for the unemployed and under-employed. For a poor man the chance to work is the greatest of all needs, and even poorly paid and relatively unproductive work is better than idleness." (page 163)

He proposes to do this by using "intermediate" technology (simple and low-cost) and by organizing smallness "within large organization". He formulates four propositions (page 165):

1) "... workplaces have to be created in the areas where the people are living now ..."
2) "... these workplaces on average must be cheap enough so that they can be created in large numbers ... "
3) "... production methods employed must be relatively simple, so that the demands for high skills are minimized ..."
4) "... production should be mainly from local materials and mainly for local use ..."

From my experience, I beleive Schumacher's basic approach is correct.

"Any intelligent fool can make things bigger, more complex, and more violent. It takes a touch of genius - and a lot of courage - to move in the opposite direction." - E.F. Schumacher

E F Schumacher is among the most controversial of 20th century economists. A long-time consultant to the British Coal Board, an 'Establishment' guest to the White House in the 1970s, but always much maligned by academic economists, Schumacher's claims to fame are two-fold. He was 1) the most famous Western promoter of intermediate technology as a development strategy for developing economies, and, 2) he was an outspoken critic of Western consumer / export-driven 'growth for growth's sake' economics.
In the first role, Schumacher was a founder of the on-going British non-profit -- Intermediate Technology Development Group (ITDG) now renamed Practical Action.
In his second role Schumacher's vision has been prophetic in view of mounting evidence for a relationship between fossil fuel combustion and global warming.
In both of these roles, Schumacher brought attention to the significance of scale, self-reliance, and the local impact of in economic enterprises.

WHAT IS INTERMEDIATE OR APPROPRIATE TECH?
Perhaps the easiest way to describe intermediate tech is by example.

Example #1: Consider the SONO filter used to remove arsenic from contaminated water. This is a chemical research-based invention based upon iron's property of chelating / adsorbing arsenic from water. This principle was applied by Dr. Ahmed Hassan when he devised a low-cost simple, home-made 3-part filter (iron filings, charcoal, sand). Millions of the $50 filters are currently being used in villages of developing nations, especially in Hassan's native land of Bangladesh.

Example #2: From my personal experience, while assigned to USAID Baghdad in 2005, I proposed funding for a residential evaporative cooler assembly facility which would be managed and staffed by Iraqi refugees. These coolers would then be distributed for little or no-cost to the poorest residents of Baghdad. Because evaporative cooling consumes 20% of the energy of compressor-driven AC, substituting or trading off summer compresor-driven cooling with these water-intensive coolers reduces seasonable AC energy consumption. Baghdad's electrical grid was stressed by load spikes each summer due to seasonal air conditioning. This project had 4 positive effects-- 1) employing refugees, 2) aiding the mostly Shia poor and reassuring them that the elected Iraqi govt. (and USAID)would not be so brutal as Baathists, 3)reducing potential of violence from heat frustration, and 4) relieving the grid from seasonal demand load spikes (assuming that users convert / substitue evaporators for compressor-based AC).
In both of the cases, the 'technology' or ingenious device had to be of simple construction from readily available local materials. It had to be priced in the range of a middle-class consumer in a poor village (or subsidized by govt. or aid donor). It had to be acceptable to the user, preferably even an improvement or variation of a currently-used product.

Schumacher has often been misunderstood. I do not believe that he denied that there is an important place in economics for large organizations. His point is these are not the ideal or most efficient way to organize small to mid-sized projects. I cannot imagine performing extraction industries like mining or oil production without multinational corporate structures that are able to raise large amounts of capital via stocks & financial markets. Schumacher's point is that multinational corporations (MNC), once they have consolidated so much power and influence, will often use their political influence and enormous resources to extend their operations into activities better done by smaller local organizations. MNCs accomplish this by monopolistic strategies. This is detrimental to formation of local industries in the small developing nations where MNCs operate. It is also detrimental to both environmental & labor practices in the developed nations where MNCs are based.

U S academic economists' attempts to obscure or discredit Schumacher's ideas only confirm the degree to which these departments are funded and controlled by large multinational corporate donors. Consider that many of these same economists fawn over Adam Smith's 'invisible hand' or similar rubbish, glorifying personal self-interests, which in some mystical way, becomes the sacrosanct and only means of creating an efficient 'laissez-faire' utopia. We live in a real world where economies & economic strategies are mixed. Reasonable folks can see in today's headlines -- Wall Street derivative scams, financial Ponzi schemes, trillion $ bail-outs by U S taxpayers -- that self-interested financiers & CEOs bear some of the responsible for corruption and greed-based economics. The 'invisible hands' of corporate lobbyists are neither civic-minded nor benevolent, that is why they try so hard to keep them invisible. These folks don't want to pay any taxes at all nor accept any responsibility beyond narrow shareholders' interests. So the tax burden is shifted to ordinary middle-class Americans as the gulf between rich and poor classes grows (and the middle-class declines).

There is a niche for Schumacher, especially among foreign aid donors, that has produced significant benefits to village-level standards of living. When violent conflict is avoided, this alternative is cost-effective. Schumacher's historical place in larger, higher-tech economic development will depend upon how much his ideas endure & influence decision-making elites of Europe, Japan, Asian & BRIC nations & developing nations. As long as we live in a world where 'people matter,' Schumacher will be read critically, applied judiciously, and admired.

Having sung the praises last month of a book that invited businesses to get bigger, it's only fair to put out the other perspective: that human-scale enterprises tend to be considerably more people-centered, to be involved in their communities, and to use resources in more appropriate ways.

During and after high school and college, I read a lot of these books: authors like Ralph Borsodi, Hazel Henderson, Earnest Callenbach, and of course, E.F. Schumacher. Schumacher's most famous work is Small Is Beautiful: Economics as if People Mattered; he has also written several other books, including Good Works and A Guide for the Perplexed.

Published 34 years ago and still in print, Small Is Beautiful was one of the first calls for economic and environmental sustainability to reach a mass audience. In places, he is eerily prescient, as when he predicts a violent struggle over oil if our society fails to curb its addiction, and discusses the stupidity of the then-mainstream economic perspective that failed to account properly for resource depletion, and also failed to recognize the consequences of creating islands of great wealth in a sea of poverty.

In his own words: "they automatically endorse the ecological stupidity of industrial man and his love affair with the terrible simplicities of quantification."

I believe it was Schumacher who coined the phrase, "appropriate technology"; certainly his books explore the power of simple devices from machines to banking and currency systems to help lift up a local populace.

And while of course our perspectives have shifted over the many decades since this book first came to light, it is definitely worth revisiting every few years.

Shel Horowitz's award-winning sixth book, Principled Profit: Marketing That Puts People First, demonstrates how to build a business around ethics, environmental sustainability, and cooperative practices--and how to develop marketing that highlights those advantages.

This book is remarkably ignorant of economic theory. For example, it only refers to Keynesian Economics by name. It never mentions the Chicago school or the Austrian school nor does it give any depth of economic analysis. Even according to its own arguments it is false, because it says that modern society cannot continue on.

Buddhism + poor economic theory, leads Schumacher towards a sort of Marxism. He preaches and insists upon a moral high ground instead off taking a historical or theoretical approach. As a result, this book is a terrible read. I was told to read this book because it is informative of Catholic Social thought--but the sad reality is, it more aligns itself with a, "thou shalt not touch Gaia"/totalitarianism than a method for organically organizing society.

One of the worst points the book offers, is the lack a historical overview to understand how and why Agrarianism is not able to feed 7 billion people. Rather it simply asserts, nature=good, consumption, while at times necessary is something like a rape of nature. It is as if, prior to the 1900s, the entire world was wonderful. In contrast to someone like Mises notes that without the industrial revolution millions of people would have starved to death. While Schumacher tries to find a third way, he ignorantly proposes that we should do certain things which necessarily would reduce living standards and throw civilization back a hundred years or more--but because he believes it is the morally correct thing to do nothing else matters.

Heck, he could at least have read about the horse manure problems before the Automobile came along. If there are any good points, they must be measured against other schools of thought--but none are taken to task. He does not address Free Markets in contrast to Fascistic (gov interfered) markets and how Buddhism is a third way. Rather, Schumacher pontificates endlessly.

In short. This book is a waste of time.

I've never been all that interested in macroeconomics, but intrigued by the title, I gave Small is Beautiful by E.F. Schumacher a try. It was a long read, but a good one, and I culled interesting insights from every chapter. Schumacher's visionary simplicity with the largest elements of society were radical 30 years ago, but incredibly relevant, then and today.

A fair portion of the book is spent emphasizing the way our economy is unsustainable and how quickly we use up our natural resources. Schumacher also explains how little consideration was put towards pollution until it was too late. In the folksy way of a 60s radical, he speaks about the importance of the land in a way that is neither hollow nor flippant, but full of wisdom and grace.

"The whole point is to determine what constitutes progress." What is progress? What should aid to the third world look like? These questions are where Schumacher particularly shines, explaining a need for intermediate technologies to improve the quality of life for everyone and not just investments which only improve the quality of life for the highest classes and leave the lower ones even more destitute.

"No system or machinery or economic doctrine or theory stands on its own feet: it is invariably built on a metaphysical foundation, that is to say, upon man's basic outlook on life, its meaning and its purpose. I have talked about the religion of economics, the idol worship of material possessions, of consumption and the so-called standard of living, and the fateful propensity that rejoices in the fact that `what were luxuries to our fathers have become necessities for us.'" wrote Schumacher. What do our economic values say about us?

This pioneering outlook is for green economics what Rachel Carson's "Silent Spring" is for the modern green movement.
OK, Shumacher gets some of his facts wrong, can be over idealistic and some chapters are less interesting than others but he often speaks in a highly quotable philosophical vein touching areas beyond the scope of intermediate technology.
For example, a great deal of his commentary is about the moral and spiritual decline and consequent rot in aspects of Western civilisation - judging by the standards of current media output and social values he is prophetic in his assessment that people may be marching into a fool's paradise poised to collapse. His statements, especially in the first few chapters are gold dust for social reformers and social scientists, trying to tap into words to express their frustrations with what we can sometimes see as errors and an odious hollowness to many things conventionally regarded as Progress or Laudible. Who indeed can name the 7 deadly sins or the 4 cardinal virtues?
Then there are those more practical ideas about the ethics of hard work, the fallacies in development planning and how many limitations set by money and raw materials are not limitations but excuses against small scale progressive schemes. This is often the antidote to Adam Smith.
The ethics in planting trees if applied to India and many other places could undoubtedly solve the world's problems en masse it seems as reccommended for India, especially in reducing Green house gasses.
The question remains if communities and societies can grasp the nettle and act out some of Schumacher's more workable schemes, especially if the USA for example collapses into an economic oblivion. Can we learn to live without mass capitalism and be happy?
The politics and philosphy of moderation and environmental economy is still in its infancy but thanks to Schumaker economists are trying to build in the environmental perspective.
This book is therefore a persuasive milestone.

This is one book that adds the perspective of the wider World (not just the technologically elite), when making decisions on engineering/business solutions (as well as other resource allocation decisions). When striving towards best solutions, some engineers & consultants may favour technology complexity and quality, when simplicity and fit-for-purpose are optimal. This book provides some inspiration and building blocks, to be coupled with the usual simulation toolkit including systems analysis, enabling development and implementation of appropriate solutions. Similarly, the book appeals to a much wider audience that can embrace such values in day to day life.
The inspirational well-written contents cover:
*Part I- The modern world- problem of production, peace and permanence, role of economics, Buddhist economics, and a question of size.
*Part II- resources- education, proper use of land, resources for industry, nuclear energy, and technology with a human face.
*Part III_ the third world- development, social and economic problems requiring intermediate technology, two million villages, and the problem of unemployment in India.
*Part IV- organisation and ownership- a machine to foretell the future, towards a theory of large-scale organisation, socialism, ownership and new patterns of ownership.
Improvements could include up-to-date case studies (perhaps including material from VSO) showing the benefits of the approach; and an update on where intermediate technology is today. Note- the book `Flexible Specialisation' by Pedersen et al (ISBN 1853392170 publ.1994) provides some such case studies for Africa, Asia and Mexico.
Personally, this reviewer was inspired by the book to lead an undergraduate team project with Intermediate Technology (the company) and Sri Lankan men designing and implementing a self-build fretsaw for educational toys in 1991. Overall a stimulating, worthwhile addition to any library.

This book should be required reading in schools - it is that good. Insightful, clear and to the point, the author's analysis of the issues is as relevant today as it was when he wrote it.

His basic premise is that fossil fuels are capital , and yet we consume it like it is a revenue stream, and this is ultimately destructive. Instead we should spend our capital resources in order to create the infrastructure for sustainability.

This book inspired the organic movement, and is the intellectual basis of so much of environmentalism. We ignore its lessons at our peri

To those who wrote negative reviews. For you the world is going to be always flat. The idea of this book - the world is other then that. I agree with some that the author pulls in different directions and admit it was not an easy read. However, this book is more relevant today then it was 30+ years ago and it deserves to be classic. Here is, in my view, what makes this book relevant today. Think about oil - it is a finite resource. Can any one argue that? With its current supply Big is Beautiful. Now imagine the world without it. Are we ready to sustain the current level of abundance on the shelves of our supermarkets? The premise that most of us have in this country, as long there is a demand it will be a supply. Dead wrong! We are at the point where we must re-think our views on how we use available resources and author prophetically tells us here are the possibilities. Author not just some idealist, trying to recruit followers to his new utopia world. There is some hard statistical evidence that we will not have other choice but to embrace the idea that Small is Beautiful too.

Economists are people who spend half of their time foretelling what will happen, and the other half explaining why what they foresaw didn't happen, right?
Well, not Fritz Shumacher. Today, in 2001, "Small Is Beautiful" is 25 years old, and almost every single prediction in the book, from the power, deshumanization, and cross-borders character of corporation, to the threat to the environment, to the ineffectiveness of liberalism in addressing the problems of the developing world, have become true.
Of special interest are the chapters that deal with adoption of technology, and the role of technology in development. In Schumacher's insights may lie the key to making development an inherent process of each society, instead of an external, massive, and rarely effective effort.
The last few chapters, about "socializing" large corporations, may be somewhat utopian in today's world, but still merit reflection.
Shumacher died soon after having published his book, so he didn't have the opportunity of spreading or developing his work. Still, this is a must read for anyone interested in sound, alternative views to the prevailing ones of "larger is better", or "if what we're doing doesn't work, we must do more of it".

When I was a student at Brigham Young University in the early 80's, I was introduced by my macroeconomics professor to what many economists of the time considered to be the "great heresy of economic theory." - a copy of Small is Beautiful. He warned me that quoting it in research papers would be most unwise, as the BYU economics department was, and continues to be, a strong proponent of the current economic orthodoxy of infinite economic growth and prosperity that dominates economics even today. He finished by saying that "Schumacher was a radical, no doubt about it. However, he will also turn out to be right in the end."
Truer words were never spoken. There are those who will point out detail errors in Schumacher's work. The book was, after all, written over 25 years ago, and Schumacher would never have considered himself a prophet. Yet the central theme of his work, that infinite economic growth is impossible within a finite system, and the inevitable consequences of ignoring this simple truth have been fully vindicated. Even the most orthodox economists are beginning to see the disasterous environmental and social consequences of their economic policies over the last 50+ years, which Schumacher describes in detail, and warn policy makers that major changes must be made. Schumacher also proposed a highly effective and practical method, Intermediate Technology, to help impoverished and developing nations make the best possible use of modern scientific and technological advances, without the vast (and for countless millions in the world impossible) financial investments and ecological/social consequences. In 1965 Schumacher and a few friends started the Intermediate Technology Development Group ...which continues to develop practical applications of his ideas in the developing world. Small is Beautiful - a Study of Economics as if People Mattered, along with his other two key books Good Work, which explores the question of the effects of modern economics on the individual and the very purpose of work itself, and A Guide for the Perplexed, which outlines the philosophical and spiritual underpinnings of Schumacher's work, provide a powerful and compelling alternative view of economics and our world - a view every bit as applicable today as it was in his lifetime.
An earlier reviewer who seemed to have no grasp of economics or recent history (Gen Ne Win is no more a Buddhist than Hitler was a Jew - he in fact deliberately set out to destroy the cultural and economic system of Burma - including Buddhism itself. To use this example to "invalidate" the chapter "Buddhist Economics" totally destroys this reviewer's credibility) stated that "a wise world has ignored his bad advice & prospered." Far from it. In the end, a wiser world will be forced to look back on Schumacher's book and conclude that he was, in fact, right.

This book should be required reading in schools - it is that good. Insightful, clear and to the point, the author's analysis of the issues is as relevant today as it was when he wrote it.

His basic premise is that fossil fuels are capital , and yet we consume it like it is a revenue stream, and this is ultimately destructive. Instead we should spend our capital resources in order to create the infrastructure for sustainability.

This book inspired the organic movement, and is the intellectual basis of so much of environmentalism. We ignore its lessons at our peri

The last great finical debacle, the one in 2007, is still affecting people the world over, but the affect is still heavy in American. I was personally affected, my wife and I both lost jobs. We have yet to recover from that. There was a snow storm a few weeks back. It occurred when the Polar Vortex slipped it’s usual spot over the North Pole and paid North America a visit. The company I work for is dependent upon trucks from Chicago based warehouses to fulfill the retail stores needs. So, when the snow kept trucks from arriving here in Kansas City, we as a store were limited as to what we could offer our customers. This, like the economic crash, got me thinking about how well connected everything is. Wall Street was too big to fail so money was thrown at it, given to those who caused the problems in the first place. What if they had failed? Could America have survived? What if this snow storm had been worse? Would food have stopped coming in to Kansas City altogether? Just how fragile is our system of life, and should it really stay that way?

These thoughts are similar to ones I have often that are concerned with the amount of resources we use to make useless things we don’t need. The amount of waste we produce. Also, the consumer culture that drives us to make and purchase these cheap trinkets. What does living and working like this doing to us? From my view of history, we have never lived like this. The few times people of the past have gotten anywhere near we are now it was chaos, it was disaster. I can only think that disaster and chaos are all that is meant for our future, we have yet to see any of the dangers of living out of balance with the earth.

Thinking such thoughts will lead a person to want to find some comfort. One of the ways to do that is find people who have been working on the problems at hand and see if they have some potential solutions drawn up. These types of people publish books to share their findings and thoughts. There are many books out there talking about our ills and sometimes a few seem to keep surfacing. This makes them tempting to read even if they are dated. One of these books is Small is Beautiful: Economics as if People Mattered by E.F. Schumacher. It was originally published at the beginning of the energy crisis in the early ’70’s. It was one of the early books that served as a warning against our insatiable appetite for earths resources and our over blown sense of self-importance.

Schumacher makes an argument we current day folks are somewhat familiar with. The resources we take can’t be replaced fast enough to be sustainable. Nature can only take some much pollution before it becomes toxic for all life on earth. Handing out technology and first world ways of doing things to developing third world economies will solve nothing. It is these first world economies that have it wrong in the first place. He speaks on how the fast paced economics of the modern world dehumanizes us. He talks about compassion, being caretakers, rather than profit makers, and he waxes on about quaint ways of life.

I won’t spend time here deconstructing his work to prove my intelligence or to sound preachy, complete with moral high ground from which to preach from. I will simple say, you should read this book. Now, mind that you don’t have to. This book has become such a staple for the environmental front and eco-warriors, and so many others. Schumacher’s thoughts have become foundational stones for such movements, therefore reading his 1973 book won’t provide you with some profound enlightenment that current literature has ignored.

However, there are reasons to read this book. I was shocked to compare the data that Schumacher used with the current data we have now. Levels of pollution and economic inequality, for example. When he was writing this warning things weren’t as bad as they are now. All of this made his warnings all the more dire. There was also his idea of decentralizing our economies, our means of production. This was real interesting to me, for what he was talking about was small self-sustaining economies. So, in the case of the snow storm, well that wouldn’t have effected Kansas City if Kansas City was more responsible in creating it’s own food. If Kansas City had a self-sustaining economy than the 2007 crash wouldn’t have been a threat either. Think of populations of people acting somewhat like terrorist cells. If some type of natural disaster befell one part of the world, it wouldn’t effect another. A city without a crisis wouldn’t find itself in one because of a another city in crisis. This would create more sustainability the world over.

Working in such a way would create village economies and these economies would have to operate on the idea of ‘enoughness’, or only using what you need. We don’t need to take and take until we have so much waste. We can have wealth and be content, thus making sure more people have wealth and future people have wealth. Schumacher called this thinking Buddhist Economics, in his words, "the aim ought to be to obtain the maximum amount of well being with the minimum amount of consumption." By not living this way we over work ourselves just so we can consume, and all that makes us human is shoved away so we can sit in a cubicle or waste away at a type of manual labor that destroys our bodies. Instead, if we lived by Buddhist Economics, we would have more time and energy to be with people and spend more time producing that which makes us happy. Schumacher takes about the happiness that people get from creating things from their own hands, even if it is just a chair. Slow labor with an acquired skill is a path to happiness.

This notion of Buddhist Economics struck a cord with me, as before I ever read Schumacher’s work I had read Me and Mine: Selected Essays of Bhikkhu Buddhadasa. Bhikkhu Buddhadasa is one of Thailand’s most famous monks. At the time when the Thai government was hunting down the communist ‘threat’ in Thailand for American interests, because America paid them millions of dollars to do so, Buddhadasa was using Buddhist teachings to argue in favor of socialist economic models. He even talked directly about Buddhist Economics as well. He felt that any moral Buddhist person would favor an economic model that brought as much health and sustainability to as many as possible.

So, while I enjoyed reading this book, it is dated. If you are looking for current day thoughts on the current data we have concerning the state of the world, this is not a book to pick up and read. However, if you are interested in reading some of the early works on environmentalism and ethical economics, this would be a good place to start. Whether you choose to read it or not, works such as Schumacher’s are becoming more and more common. There are many educated people working on world crushing problems right now and they are taking their findings straight to the people. They do this because those with power, governments, corporations, aren’t listening. As a matter of fact, they are actively trying to silence research that could save us and our future on this planet. So, read Schumacher or not, but start somewhere.

Having read Small is Beautiful in the early 80s I re-read recently, struggling initially until I started to read aloud. Treated as a speach, Schumacher has a wonderful and relevant turn of phrase - the 'bland leading the blind', 'to talk about the future is useful only if it leads to action now', 'where is the rich society that can say halt we have enough, there is none'. He tries to inspire us, to cajole, to use langauge to persude us of an alternative world - and in doing so he romances the reader.

But beyond his phraseology many of his ideas still have massive relevance for today.

As someone involved with the charity he founded, Practical Action, Ive seen these ideas in action in the developing world. Small scale technology, empowering people - delivering a hand-up out of poverty, and through the sharing and sharing again of experience and lessons, multiplying the benefits so that yet more thousands of people are helped.

Schumacher and Small is Beautiful isnt perfect, his view of women for example
was dated even in the 70s, but if you want a book thats full of ideas and that will woo you into change try Small is Beautiful - but read it out loud!

"The whole point is to determine what constitutes progress." Fritz Schumacher published Small is Beautiful in 1973, but the vast majority of his text is still relevant today, if not more so. This book can be read as a response to the Washington Consensus and Chicago school economist perspectives of metric-based laissez faire economics driven by efficiency, often at the expense of class polarization and increasing inequality, that pervade the shallow "common-sense" understandings of amateur economists and the general United States population: "...growth of GNP must be a good thing, irrespective of what has grown and who, if anyone, has benefited." Schumacher recognizes that "...economists, for all their purported objectivity, are the most narrowly ethnocentric of people. ...since their world view is a cultural by-product of industrialism, they automatically endorse the ecological stupidity of industrial man and his love affair with the terrible simplicities of quantification."
Schumacher responds with a broad, big-picture discussion of our economic culture, noting that sustainability is an impossibility when ever growing demands for increased production, "assuming all the time that a man who consumers more is 'better off' than a man who consumes less", expend an environment with finite resources. He notes that lasting peace is threatened by extraordinarily unequal distributions of power and access to resources, "what else could be the result but an intense struggle for oil supplies, even a violent struggle," and echoes Gandhi's disapproval of "dreaming of systems so perfect that no one will need to be good." Schumacher criticizes trump card economic judgments, arguing that "society, or a group or an individual within society, may decide to hang on to an activity or asset for non-economic reasons - social, aesthetic, moral, or political," and further noting that the judgment of modern economics is a fragmentary judgment, caring only "whether a thing yields a money profit to those who undertake it or not.... It is a great error to assume, for instance, that the methodology of economics is normally applied to determine whether an activity carried on by a group within society yields profit to society as a whole." The market, he argues, "is the institutionalization of individualism and non-responsibility.... To be relieved of all responsibility except to oneself means of course an enormous simplification of business. We can recognize that it is practical and need not be surprised that it is highly popular among businessmen." Commenting on this culture of self-interest, he quotes Tolstoy: "I sit on a man's back, choking him, and making him carry me, and yet assure myself and others that I am very sorry for him and wish to ease his lot by any means possible, except getting off his back."
While economics teaches us that "the ideal from the point of view of the employer is to have output without employees, and the ideal from the point of view of the employee is to have income without employment," Schumacher believes this perspective fails to understand that a persons acts both as a producer and consumer: "If man-as-producer travels first-class or uses a luxurious car, this is called a waste of money; but if the same man in his other incarnation of man-as-consumer does the same, this is called a sign of a high standard of life." Furthermore, "to strive for leisure as an alternative to work would be considered a complete misunderstanding of one of the basic truths of human existence, namely that work and leisure are complementary parts of the same living process and cannot be separated without destroying the joy of work and the bliss of leisure."  
Schumacher also comments on science and a set of nineteenth century scientific ideas which have become the lenses through which we have learned to interpret the world. He argues for care in selecting the direction of scientific research, since, "as Einstein himself said, 'almost all scientists are economically completely dependent' and 'the number of scientists who possess a sense of social responsibility is so small' that they cannot determine the direction of research."
In Part III, Schumacher explores third-world economic development. He notes the power dynamic inherent in the non-democratic system of free trade as it exists today: "It is a strange phenomenon indeed that the conventional wisdom of present-day economics can do nothing to help the poor. Invariably it proves that only such policies are viable as have in fact the result of making those already rich and powerful, richer and more powerful." He explores models for third world development, focusing on appropriate technology that can avoid creating a dual-economy, which affects the power structure and causes systemic migration: "It is always possible to create small ultra-modern islands in a pre-industrial society. But such islands will then have to be defended, like fortresses, and provisioned, as it were, by helicopter from far away." He argues instead for distribution of development resources to non-capital-intensive human-scale projects that can be maintained by local people, maximizing the level of useful employment rather than productivity per person. He emphasizes that appropriateness can be assessed only through learning local culture and working with and through local people: "As long as we think we know, when in fact we do not, we shall continue to go to the poor and demonstrate to them all the marvelous things they could do if they were already rich." He also warns against crippling dependence on foreign powers for supply or demand: "the role of the poor is to be gap-fillers fin the requirements of the rich," and focuses instead on small-scale development of local focus.
Overall, while I cannot agree with all of Schumacher's assessments, I doubt that "small is beautiful" can be a true universal claim, I question his assumptions of gender roles and his naïveté about realpolitik, and I also feel that his periodic appeal to religious rhetoric and "beauty" somewhat obstructs his message, I do feel that he makes a great many strong points and encourages the reader to question conventional economic wisdom and look for a deeper understanding of the world.

Almost the only economics book I have read. It has been useful to explain work and the need for work by all in our society. Also shows how a corrupt business will not be able to grow and other ethical considerations for business and economists. Critics of the green party could best inform themselves of our economic positions and see that a humane economics can be extended to a middle ground with any other politics.

The statistical information is years out of date, Schumacher approved of nukes without apparently understanding the insoluble problem of storing radioactive wastes for millennia without leakage, but in general the book is worth a reread. I hadn't realized it was a book of the 1970s after I'd begun publishing environmental magazines, books and useful pamphlets under my married name. But his idea of slowing down the pace of technology, and assuring its safety, should appeal to conservatives as well as to concerned liberals.

a book which covers the realms of economics with heart and compassion. Something we are taught to ignore when it comes to money. This book is unbelieveable in the fact that it is way before its time and still hits home hard as ever in terms of its reflexivity on behalf of the author and subject matter. No matter where you are in the world, (gender, status or profession) this book really musn't be overlooked. It can teach us ALL something. If not about economics then about life.

When the man can to understand that the true goal of the life is to love your own specie, without any kind of exigency and what is really important for him is what he fill in the hart, no matter how many has he or how big is he, then he is prepared to love this book.