Published by EH.Net (June 2013)

Spencer J. Pack, Aristotle, Adam Smith and Karl Marx: On Some Fundamental Issues in 21st Century Political Economy. Cheltenham, UK: Edward Elgar, 2010. xv + 260 pp.? $125 (hardcover), ISBN: 978-1-84844-763-9.

Reviewed for EH.Net by Gary Mongiovi, Department of Economics and Finance, St. John?s University.

Spencer Pack has been exploring the ideas of Aristotle, Adam Smith and Karl Marx for close to three decades. His latest book is a stimulating and wide-ranging account of what these three ?great system-builders? have contributed to our understanding of society and the economy. Pack, who has written much about the nexus between philosophy and economics, is well placed to undertake an ambitious project of this type. He argues that the conceptual and discursive frameworks developed by Aristotle, Smith and Marx are not ?paradigms in conflict? but ?intimately related? systems that continue to have profound social-scientific relevance. In expounding this claim, Pack must perform a delicate balancing act. He brings to light, with considerable erudition, the significant connections among the outlooks of his system-builders. But he also examines the many tensions embedded in their different social and philosophical visions. He didn?t quite convince me that Aristotle?s perspective is ?intimately related? to the frameworks of Smith and Marx.

The book is organized into four sections. Parts I, II and III discuss in turn how Aristotle, Smith and Marx handled six basic themes: exchange value, money, capital, human character, government and change. Part IV considers how their insights on these themes shed light on a number of modern economic problems. Each of the first three sections might stand alone as a primer on the socio-economic thought of the philosopher with which it is concerned. But rather a lot is going on in this book, and no clear narrative arc emerges. This may be because Aristotle, writing a good eighteen-hundred years before the birth of capitalism, has far less in common with Smith and Marx than the latter two have with each other. Marx was born less than thirty years after Smith?s death, and his theoretical framework was built on the classical political economy foundations that Smith had laid down. Having studied philosophy, they were both deeply familiar with Aristotle?s writings of course, and we find in their work traces of Aristotelian influence as well as instances of direct engagement with his ideas. But there are obvious limits to what ancient philosophy can contribute to our understanding of how a market-based industrial society functions. Toward the end of the book Pack suggests in passing that Marx?s project can be interpreted as an attempt to explain the functioning of capitalism in terms of the four categories of Aristotelian causality (final, formal, efficient and material). This is an intriguing hypothesis, but Pack does not develop it at any length; nor does he offer any compelling evidence that Marx himself understood his theoretical agenda in this way.

A detailed overview of the book?s content lies beyond the scope of this review. I shall instead try to convey the flavor of Pack?s argument by discussing a few topics that struck me as particularly interesting.

Pack devotes a good deal of attention to the views of Aristotle, Smith and Marx on how market activity affects character. Aristotle considered chrematistics ? the use of money to beget more money ? to be ?unnatural? and corruptive. The pursuit of material gain cultivates an obsessive concern with the acquisition of wealth, and consequently undermines the values necessary to achieve a properly balanced life; that is to say, it subordinates reason (which favors moderation) to the passions (which cause us always to covet more than have, even when we have more than we need). Aristotle?s assessment is a sobering corrective to the conventional view of the capitalist mind as a supremely rational and dispassionate engine.

Smith, by contrast, saw commerce and finance as natural and beneficent. Yet he too recognized that commercial society can foster unseemly character traits. In pursuit of self-interest, capitalists and rentiers may be tempted to engage in predatory or deceptive behavior. Repetitive factory work dulls the intellects of the laboring classes. The precariousness of their economic condition makes workers acutely conscious of the dangers of licentiousness: ?a single week?s thoughtlessness and dissipation,? Smith wrote, ?is often sufficient to undo a poor workman for ever.? Workers may therefore be drawn to religions that demand strict adherence to severely austere codes of behavior, with ostracism the penalty for nonconformity. Smith was no fan of such ?disagreeably rigorous and unsocial? sects, which he regarded as dysfunctional by-products of the market system. On this topic Pack stresses, first, that both Smith and Marx harbored misgivings about organized religion, and, second, that the appeal of anti-humanistic fundamentalist religious movements remains a problem in our own day.

For Smith the causal link between religion and capitalism runs in the opposite direction from that posited in 1905 by Max Weber in The Protestant Ethic and the Spirit of Capitalism. As Pack notes, Marx recognized that Protestantism helped to entrench capitalism; but I suspect that Smith?s causal link would have been more congenial to Marx than Weber?s. For while Marx, as Pack also notes, was never guilty of crude economic determinism, a key tenet of historical materialism is that the major ideological elements of any society, including its religious beliefs, are predominantly shaped by the prevailing mode of production.

Pack reminds us that Smith was never a doctrinaire free-marketeer. Smith readily acknowledged the necessity of state action to provide public goods like education, or to remedy social ills that were either caused by or could not be alleviated by the market. But the main function of the state, and the main impetus for its formation, in Smith?s view, is the protection of property. He realized, though, that in fulfilling this crucial role, the state almost invariably, and often unjustly, sides with capitalists in the ongoing tug-of-war with workers over how the income generated by production is to be divided. This partly accounts for Smith?s mistrust of government, a mistrust that was shared by Marx. A commendable feature of Pack?s book is that it calls attention to parallels between Smith and Marx that are too often overlooked, and that, more importantly, remain pertinent to the political economics of our own time. Marx would not have been surprised at the influence that capital exerts over our political discourse today; Smith, one imagines, would have been appalled.

Unlike Smith, and in line with Aristotle, Marx saw the obsessive quest for material wealth (surplus value) as an activity that corrupts human character and undermines the prospects for a meaningful and genuinely flourishing life; it debases capitalists and workers alike. But to Aristotle?s views on this matter Marx adds that the capitalist really has no choice: competition compels the bourgeois class to pursue profits with single-minded resolve; for the capitalist who ceases to accumulate will be overrun and eventually destroyed by his brethren.

I hinted earlier that Pack?s compare-and-contrast exercise is more successful when it focuses on Smith and Marx, who, for all their differences, share a modern intellectual outlook and belong to a classical political economy tradition that Aristotle would have found not only utterly irrelevant to the pre-capitalist society in which he lived but also utterly mystifying. By the same token, Aristotle?s observations about price formation and income distribution have little bearing on the analytical issues that have preoccupied economists from the eighteenth century onward. Perhaps the starkest incompatibility has to do with how Aristotle, on the one hand, and Smith and Marx, on the other, viewed history. Aristotle understood history as a circular process defined by the recurring cycle of the seasons, not as a forward-moving trajectory of irreversible change. For Smith and Marx, and indeed for anyone born into western society after, say, 1600, history is an unfolding evolutionary path; even when it appears to repeat itself as tragedy or farce, such episodes are part of a transformative dialectical process. These fundamentally incompatible conceptions of history circumscribe what Aristotle and moderns have to say to one another across the centuries.

Pack speculates that this shift in the conception of history might be explained by the ?realization [in the modern era] that animal species are not eternal. Species may … become extinct; this suggests that new ones may arise.? It seems to me more likely, though, that the capitalist mode of production, which upended and radically transformed traditional social and economic institutions in a relatively compressed period of time, was the catalyst for the emergence of a view of history as progressive change. Progress, evolution and development ? concepts that we nowadays presume to be embedded properties of social existence ? are rooted in the particular market-centered way that much of the world has been provisioning itself for the past four or five centuries.

Aristotle?s empiricist approach to knowledge offers a potential point of contact with Smith and Marx, both of whom grounded their analytical systems in such observable data as the technical conditions of production, the consumption requirements of the workers, and so forth. But Pack says nothing at all about the epistemic outlooks of the three system-builders, so in the end Aristotle remains something of an odd-man-out in the story Pack wants to tell.

There is some loss of focus in Section IV on ?Lessons for the 21st Century,? which is a hodgepodge of Pack?s (generally thoughtful) reflections on the economic challenges confronting the world today. The book?s readability might have been enhanced by judicious culling of the overabundant and too often distracting footnotes. But overall, Pack, starting from the premise that intellectual history is an indispensable part of the economist?s toolkit, has given us a thoughtful book that could serve as a solid anchor for classroom discussions of the broad ?sociological? dimensions of capitalism.

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