The historical narrative that makes up the first half of the book is definitely interesting, but it is worth mentioning a couple of important concerns:
- First, as one reviewer on Amazon notes there is little statistical evidence presented to back the author’s claim that Quakers were any more ethical than their counterparts. “it is difficult to know what percentage of Quakers followed the examples of looking after their workers that are given in the book. Similarly there is an impressive list of companies run by Quakers but do we really know how many in these Quaker ‘family’ firms were really practising Quakers? Without any figures it is difficult to make a judgement on the claims made… is it possible to say whether the percentage of Quaker employers who looked after their workers was significantly higher than the average?”
- Second, his historical argument is that “Quakernomics…is a philosophy of wealth creation which sought from the outset to put its wealth to social ends” (128). While he does provide some examples of Quakers seeking changes in public policy, the bulk of his examples to support the idea of the social concerns of Quaker business owners (above average wages, model villages, hot chocolate instead of beer, etc.) are rooted in voluntary action and moral persuasion rather than legislation. This historical evidence is at odds with the author’s personal conviction (which informs the economic analysis in the second half of the book) that “the state must inexorably play a key role in the construction of an ethics for reining in raw capitalism” (255).
In the end we discover the author’s true position, which is that Quakernomics (as he defines it) is essentially a historical artifact that has little bearing on our current situation. What we really need is basically what many of his readers likely already experience: the modern democratic welfare state. “Quakernomics was an ethical capitalism,” King argues. “But it was religious, voluntarist [thank you!] and paternalistic. Such a capitalism no longer fits the modern world… the specific ethical capitalism of Quakernomics has no place in the modern world… But Quakernomics is conceived here as only one possible ethical capitalism out of many. We have to forge a new one, appropriate to our era, inspired by this real example” (254-255).
Quaker Ethics and the Austrian School
And this brings us to the underlying question of ethics – particularly an ethics informed by Quaker principles. For this exploration, it is instructive to turn our attention to his chapter on Austrian Economics (177-183).
Not unlike Jung Mo Sung and Joerg Rieger, King unfortunately chooses to undermine his argument by singling out the Austrian School for special attention while demonstrating only a cursory knowledge of the subject. King’s caricature of the Mises and Hayek in particular is that they present a knee-jerk reaction to Nazism, conflate Nazism with his more benevolent understanding of socialism, and therefore react with unnecessary fear of an expansion of state power. “At root it is an extremism which sets itself against the mixed economy that in practice nearly all developed nations have pursued: a balance of private competitive enterprise and state control, or, in other words, a moderated capitalism” (180).
Mises and Hayek – both having fled likely death in Nazi Germany – were undoubtedly reacting in their writing and political and economic analysis to that reality. These were of course not their only contributions to economic understanding, though, and their concerns should not be seen as limited to that particular historical event. Further, the contributions of the Austrian School as a whole did not begin or end with Mises and Hayek. King appreciates the role of innovative entrepreneurs in the economy in general and Quakers as “good individualist Schumpeterian entrepreneurs” (182) in particular, and so might be interested in the later work of Israel Kirzner on the subject.
But back to the ethical question at hand.
King argues that “In many ways, the legacy of von Mises and Hayek represents the antithesis of the Quaker tradition: the ‘kryptonite’ to Quakernomics perhaps. It drives a wedge between economic activity as initiated by the entrepreneur within a broadly free market, and any consideration of social consequences, and it does so by raising the spectre of Nazism” (183).
King’s goal throughout the text is to paint his middle-of-the road approach of “restrained” capitalism as a reasonable response to the extremes of Marx and Mises. This is surely debatable from a purely economic and political standpoint, but King wants to go further and suggest that Quaker ethics compels Friends to adopt such a perspective. Does this position hold up to scrutiny?
Let us go along with King in the assertion that we can have both a socialized economy and personal freedoms, in contrast to his characterization of the Austrians. For Quakers, a deep ethic should call us beyond a mere utilitarian objective to achieve the greatest good for the greatest number, regardless of the means employed. Our commitment to peace should lead us to question an overreliance on the use of state force to accomplish any goal. In fact, his own historical analysis of Quakers in business points in this direction and ultimately leads him to label them “voluntarist.”
The State as Virus
In addition, King’s devotion to the mixed economy welfare states of the U.K. and U.S. leads him to completely overlook what these economies really are: welfare-warfare states. The utter denial of the danger Mises and Hayek warned about with regard to state violence and oppression coupled with the complete absence of any analysis of the violent and oppressive nature of these centralized states at home and abroad may not be unrelated.
Could it be the case that the unsustainable nature of the violent Communist, Fascist, and Nazi regimes of the 20th Century has led to an evolution in the nature of state violence such that states can still engage in significant acts of violence and destruction but do so while projecting the illusion that they are instead agents of peace? An analogy may be helpful here. When many of us think of viral outbreaks, it is easy to imagine the destruction of entire populations. Biologists have come to understand, however, that in order to survive and thrive a virus must have a viable host. “[T]here is a natural force providing pressure on the parasite to ‘self-limit’ virulence. The idea is, then, that there exists an equilibrium point of virulence, where parasite's fitness is highest. Any movement on the virulence axis, towards higher or lower virulence, will result in lower fitness for the parasite, and thus will be selected against.”
From a political standpoint, this self-moderation for the sake of sustainability is similar to Anthony de Jasay’s observation in The State that “when the government is unpopular, it pursues popular policies and when it is popular, it indulges in its own ideology” (271). For Friends, this should be highly worrisome. To the extent that we turn to the state to impose a position we support on others we participate in the perpetuation and expansion of its systems of violence. Quakers are called to a higher ethic than political utilitarianism.
If King’s “ethical capitalism” is linked to this approach then it is truly neither ethical nor capitalism. The Quaker philanthropists King highlights can point us toward a different vision rooted in Quaker principles and built upon the ideas of peace, generosity, wealth creation, and voluntaryism.