Abraham Rotstein, Weekend Notes II

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Weekend Notes (Overview)


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Parsons

[3] Parson's new book doesn't distinguish between the formal and substantive meaning of 'economic'. Parsons doesn't think you can accept the economy without scarcity. He recently confided this to a student of this, Murray Polakoff.

We say that you can't have two postulates - scarcity and livelihood, for they are two different positions, e.g. eating spinach and the manner you can get more rational organization, are utterly different. Without separating them you can't clarify the thing.

Parson's new book looks like it is boosting economic analysis into general sociology, and will elate the economists.

Parson's scarcity and rational process is the compound meaning. We accept the compound meaning but in a particular situation we choose the meaning which is more useful. The two meanings have nothing in common. We have no quarrel with the compound concept but we want to be clear. The question of when scarcity arises is a sociological problem. If the economy is organized through scarcity, of course scarcity is everywhere. But scarcity may be quite unimportant, and the material side important.

(Following Pearson's essay on Parson's book:) Interest in non-market economy is important for primitive economies and also when market doesn't work (associating primitive economics [4] with depression). Interest in savage society comes from the fact that the market doesn't work well. This is the power of the whole conception. […]

Parsons thought… […]

What Parsons… […]

Weber held that civilization was increasingly “Zweckrationale”, e.g. in the army, in the bureaucracy and top it all, in the economy. Weber was after a historical problem not a theoretical one.

Economics is not necessarily a special case, or sub-system of sociology as Parsons holds. Why should price problems be treated by sociology? The theory of society and the theory of a [5] sub-system called economy,

The Reality of Society (2)

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My Essay (April 30/56) has linked the concept of the Reality of Society with the new institutional theory. P. used the concept only metaphysically. I used it naturally in a sociology which is not atomistic.

[…]

[9] Owen said… […]

Bernard Shaw is the only thinker who thought of it in this way, that society was limited in the possibility of its ideals but he never drew the conclusion to leave things as they are - on the contrary.

[…]

[11] There are thus two rationales, the survival of society, and that of the individual, and here you have the general problem of political theory. Society consists of individuals. The condition of their survival are different. How then is it possible that society survives through the actions of the individuals who compose it?

It is a fact that society survives. There must then be a real answer to the problem of freedom. Where does it come from? It is very peculiar.

With the old Greeks freedom (eleutheria) meant not being a slave, being pretty well off, educated, and behaving in a liberal way. It was the opposite of being mean.

In Paul: what does he mean when he brings in the idea of Christian freedom? It has something to do with the opposite, with death of sin. It is a metaphor of emancipation. The slave, when {fread} ceases to be a slave. It is a metaphysical experience.

[12] In Westermann: description of emancipation through the Delphic temple - Paramonai.

The Christian idea of society is that it is a relationship of persons. The revelation of the reality of society impiges on Christian freedom. It takes away the immediate topicality of the second revolution. (The latter was about 1935, the reality of society about 1942.)

In the "Essence of Fascism”, Polanyi didn't have the position he reached later. He was strongly influenced by Macmurray's Personalism - the individual in the community is real, the isolated individual doesn't exist. Personalism is not individualistic, but from the point of view of sociology it is.

In 1936 P. was under a strong religious influence in viewing the reality of society. P. had presented such an idea to his English friends in Vienna in the late '20's', so that it wasn't new. The ideal was of a community of persons which was instituted. The there was a society which broke up this ideal. The idea was to achieve a community of persons - which was naive. It took a complex society to reveal the concept of inevitable alternatives.

The "individual-in-community" concept protects one from slipping into an atomistic conception. The Christian conception is that the individual doesn't exist outside the community. He exists through others in the community. No one is alone, because then the concept of life would disappear.

[13] There is nothing of this penetration in the Jewish position. The people as a whole exists in relation to God. In the Christian position the individual has his being in and through the other. It is not the same as loving one's neighbour as oneself. Loving is not clear unless it means selflessness. It is a philosophic idea, not an emotion.

Events are conceivable in 3 ways: 1.) Mechanical causation
2.) Organic growth
3.) What happens to persons as persons, i.e. between no meaning in mechanisms or biology.

Reciprocity exists between persons as persons. This was developed in a peculiar operational way by George S. Mead. How can it come about that you exist as a self to me? Macmurray didn't take up the operational aspect but had an intuitive insight into this position. It is peculiar because it leaves to God one characteristic - that there is a person he can address himself to. “Related” doesn't mean love or sympathy, or the relatedness of objects.

To accept the fact of our being persons is the deepest we can get to ultimate reality, The idea of another person is implied in oneself. The self to which you talk is not the same as the one talking. This constitutes us as persons.

[14] The deepest meaning is that we regard the world as meaningful, and this is only by personal events having a meaning. Nothing in nature is meaningful. Meaning is the medium in which persons meet. All personal faith consists in knowledge that things have a meaning.

This is what John's epistle says. John starts, "In the beginning there was the logos”. The Dead Sea Scrolls are along John the Evangelist line. This was a Jewish line of thought, not the Synoptics. The sentences are similar to the Essenes. Tolstoy regarded John as the essence of Christian teachings. (See book by Toltstoy on the reconstruction of John). The Synoptics are the rest of the teachings. The nearest translation of "logos" is meaning. Cf. John: "In the beginning was the Word (logos) - the meaning of things. (Without meaning there would be no persons). "The light shineth in darkness: and the darkness comprehend it not". (i.e. did not encompass it). The first five sentences sum up what must have been the Essene creed. "The light shineth in darkness is not like the Zoroastrian creed of light and dark. Life was like light. The more life the more light. Life equals light equals meaning. These are metaphors for the happy being of inner life. Darkness is passive and doesn't put out or take in light. It is not a matter of belief or faith-moaning is reality. It is what consciousness means. Meaning means getting it and passing it on. No principle can create forms meaning because that principle itself must have a meaning.

[15] Modern positivism… […]

The Messianic aspect in Jewry was not in the Prophets. It existed in strong movements in the third and second century B.C. revealed by the Dead Sea Scrolls. A messianic leader in the past lost his life like Jesus. But in the turn which things take in Jesus, it is doubtful that anything of the kind was present before. The Essenes belief was eschatological, otherwise he banning of women was not possible.

Christianity reached a low again and again but had the power of retrieving itself - St Augustine, the Monastics, the Benedictines, Cluniac, the {friurs} Reformation, Counter-Reformation, then [16] the various secular movements that came with the Enlightenment.

In America, Protestantism created novel movements in Western christianity of the pioneer type from the 18th century on - Benjamin Franklin (?), the Mormons, Shakers, Quakers.

The was an incredible capacity of the Christian church to start afresh being covered with crime and slime, through an expansion or an inward movement. There were frequent mystic periods.

Science revolutionized Christianity. Calvinism was an outgrowth of the scientific spirit, a turning against supernaturalism, the priesthood and miracles. The beginning of the scientific turn was about 1530 and hasn't stopped for a day. Protestant Calvinism as its height was anything but enlightened, but the scientific spirit caused an explosion of a general religious kind. We have to be cautious here, since the more you look into the more puzzling it is. Only in the present you can speak about certainties. (As long as you're sincere you can't go astray).

[…]

Politics and the Current Crisis

[21] Clausewitz' book is still the best one written on power.

The danger in the post-war…

The Institutionalists

Background of the Great Transformation (2)

[24] … P. wrote in 1909 (or 1912)[1] that growing monopoly capital would bring a ruling class sociology instead of an atomistic sociology and develop a ruling class morality. …

The Exchange Triad and the Gold Standard

[26] P.'s new idea is that the catallactic triad is now dissolved and we should accept this as a fact and therefore not try to restore world trade through a world market and an international monetary system. The restoration of an international monetary system and world trade should occur independently and independent of markets. The international gold standard is not possible - it caused the crashes. There is no way back and we have here a principle for world economic policy.

[27] Until 1931, no one doubted the Gold Standard, even the Communists. (P. recounts in 1946 the he gave a speech at the London Club, A Russian have an impassioned defence of the gold standard.)

The U.S. today is in the same position… […]

Fusfeld (in his bo[o]k on the New Deal) could have shown that Roosevelt never understood why America went off gold. […]

P. got his gold standard position from Keynes. The Keynesian discovery was one of the greatest discoveries ever made.

[28][…]

[29] Bishop (c.f. G. Trans.)[2] said that economics ought to be called catallactics. It would be better to call the catallactic triad the exchange triad.

Every policy needs a theory. Before Smith no one ever thought markets important. Smith held that the more markets the more division of labor. Smith's discovery of the market had a tremendous policy effect: destroy tariffs, subsidies and regulations, and organize the economy through the market which will permit the division of labor and therefore increased productivity of labor.

Polanyi is sending the market packing: do not organize money and trade by and through the market.

The U.S.A. (2)

The 1958 Book

[31] This book will discuss market economy and planned economy, and bureaucracy and freedom. Athens and Dahomey will be cited to show that these are ancient problems. It will show that catallactic triad is not a valid conception. […]

With the '57 book this book becomes obsolete unless you make it a policy book, and the policy idea would be the separation of trade, money and markets.

[…]

[33] P. disregarded anthropological culture trays and motivations and was interested only in operations, not in peculiar motives, beliefs and religion. This is the great advantage of this method. P. started from anthropology but left it behind. Very quickly found his way to empirical work and didn't follow along in a philosophical vein. The '58 book will react upon the G.T. When starting on The Livelihood of Man, P. wanted nothing to do with the G.T., but as a matter of fact it is a direct outgrowth.

P. might have very easily lost himself in speculations and thoeries, but these would have been of little use, because they have no authority.

The publishers are putting out a third book, by Lazarsfeld and Katona on the boundary process. Parsons wants to answer Harry in the third book.

The Ford Project

Remarks

The Trade Cycle

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[34] We still don't have a theory of the trade cycle. P. never did anything about the trade cycle problem. Pearson wanted to take it up as a problem of stability and instability. P. agrees with those who say that we cannot describe the trade cycle in a way which tells us how it happened. P. had had trade cycle theory which later Hayek produced and was then shattered by Keynes. P.'s theory was never stated. It was naturalistic theory based on the nature of production, a substantive theory. P. was never much interested in this.

World Religion

[35] All World religion developed within about 500 years of each other. Jesus doesn't set this date but the Essenes do 200 years earlier. The Jews set the date in Palestine in the 6th century. One relates the Essenes to the Prophets and one gets this range from 8th[3] century - Buddha to the 6th century - Lao-Tze.[4]

What caused this great religious epoch throughout the whole world? It may be a cosmic event, such as cosmic rays. The earth may have got a cosmic shot in the arm. More probable than not something happened and you cannot exclude the whole realm of the earth being influenced from outside.[5][6]

Meaning of "material"

[35] Question on meaning of “material” in definition of economic:
“Economic” is not a category but a degree term - it has connections that are economic. In a market everything is economic to a degree. Insofar as transactions refer to appropriational movements we regard them as economic. If a wizard gives a health service it may be economic.

There is ambiguity in the meaning of “material”. It may be used for the shelter given by a house, or the service of transportation - getting from one place to another is regarded [36] as a material need. The use of material means doesn't make a phenomenon economic e.g. potlatch may involve the prestige use, rather than utilitarian use.

Why do we call both services and things material? Everything that serves Man's body is material, whether it is a thing or a service. A man serving the army isn't performing an economic service ) it may be patriotic. The term “material” applies primarily to means and to ends - material objects which serve any human purpose or activity. It also refers to anything (services) serving material wants. Only recurrent pressing needs are meant here - physical, bodily, or physiological needs are all material. The health wizard is performing an economic task.

Material want satisfaction refers primarily to means, but secondarily to wants, in case the means are not material, e.g. refers to a man in the army, only if he is a mercenary, but otherwise why should the defence system be regarded as economic? The formal definition is simple but ours is not.

Questions

My question:
Is the scarcity notion involved in the whole idea of progress? […]

[37] My question: Can we give substantive treatment to modern instalment buying as transfer of use via token ownership and token payment?

Rudolf Stammler, Wirtschaft & Recht. The economistic approach can't distinguish law from the economy.

My question: Suggestion for a text-book to teach General Economic History to a College class.

Weber's book on General Economic History is best, but it is translated badly. Use it for problem of economic rationalism and rationality. Otherwise use the new edition of the Heaton Book. It is extremely readable but the class will be utterly misled by its contents.

--------

P. assumed that Aristotle had no market economy and didn't know the market system, and that the 2000 years that had gone before in Babylonia had no market system.

--------

There may be a revival of interest in The Great Transformation. Last year Rinehart sold 317 copies. May be due to Riesman's reference to the book in the Lonely Crowd.

The Assyriologist with whom P. has been working has decided to put their results to the leading Assyriologists in America, and recognizes that everything in the field of Mesopotamia is inadequate and that our methods alone give hope of clarity.

A. Rotstein

Omission: the far great influence of Adler than Freud on modern times, e.g. “compensation”, “inferiority complex”, etc.

Text Informations

Date: May 5, 1956
KPA: 45/03 Other Languages:

Lge Name
DE
FR Abraham Rotstein, Notes de fin de semaine II

Editors' Notes

  1. Rotstein means probably “Nézeteink válsága” published in 1910 but written in 1909. -- Santiago Pinault, 18 June 2017 (BST)
  2. (Arch)Bishop Richard Whately: p. 185, Kindle ed. loc. 4391. When, in GT, Polanyi speaks about Whately (and mentions not the 'catallactic' that appears only in the USA period) it's in relation with Ludwig von Mises. Von Mises used the concept of 'catallactics' in Die Gemeinwirtschaft [1922], and after, in an article published in the Verein für Sozialwissenschaft und Sozialpolitik in 1928: „Bemerkungen zum Grundproblem der subjektivischen Wertlehre“. We also find an occurrence in a simple footnote in Nationalökonomie in 1940, and finally, in 1949, with the whole chapter 14 in Human Action dedicated to “the Scope and Method of Catallactics", or « science of exchanges".
    We can imagine that Polanyi knew the 1922 book and we have several proofs that he read Nationalökonomie. So, as anybody quotes Whately excepted Mises, I think Polanyi quotes Mises when he pretends to quote Whately -- Santiago Pinault, 18 June 2017 (BST)
  3. At the margin: 6th ?
  4. Polanyi had the same conception in 1923 and “Jézus feltámadása”.
  5. As Polanyi never expressed something like that, maybe they are more 'Rotsteineen' than 'Polanyian'… -- Santiago Pinault, 19 June 2017 (BST)
  6. French translation: « Toutes les religions du monde se sont développées dans un laps de temps de 500 ans. Jésus ne fixe [“set”] pas cette date mais les Esseniens le firent 200 ans plus tôt. Les Juifs datent la leur en Palestine au 6ème siècle [avant JC]. Certains relient les Esséniens aux Prophètes et on peut alors placer cette date au 8ème siècle – Bouddha au 6ème [comme] Lao-Tse. Qu’est-ce qui a fait que cette époque a été si importante pour les religions lors l’histoire mondiale ? Ça a pu être un événement cosmique, comme des rayons cosmiques. La Terre a pu se prendre un tir cosmique dans les bras. C’est plus probable [que de penser] que rien ne s’est produit et on ne peut exclure que quelque chose d’extraterrestre ait influencé le monde. »