Richard E. Wagner
Entangled Political Economist
Social Philosophy
Theories of systemic general equilibrium were all the rage in my student days. I learned those theories but never believed in them. To be sure, I wasn’t a sixties-style radical student who sought to tear down existing structures and conventions. But neither did I accept the Peaceable Kingdom subtexts of the Edward Hicks paintings that can surely be rendered isomorphic with equilibrium theories. I grew up living amidst conflict in various forms and always thought that economics should render life in society more intelligible than it did. But it didn’t pursue that feeling. More than anything, I wanted to establish myself as a professor of economics and knew doing this required a sustained record of publication in economics journals. Which I proceeded to develop, doubtlessly reflecting John Paul Sartre’s dictum that existence precedes essence.
Increasingly as the 21st century came upon us, I lost interest in academic economics and its paraphernalia. Concerns of existence receded as concerns of “what’s it all about” came to dominate my emotional consciousness. I came to recognize that I wanted an economics that would illuminate the challenges associated with humans living together in close geographical proximity, in contrast to continued trituration of models of constrained optimization. I wanted an economics where people would do things with other people, and with social reality emerging out of those interactions. Four books I published between 2007 and 2020 heralded this transformation in my scholarly agenda, which point in turn toward what can reasonably be described as a post-classical social philosophy.
In 2007 I published Fiscal Sociology and the Theory of Public Finance. This book explained that nearly the entire body of scholarly work in public finance was developed under the presumption that we live in a fantasy world where all the abstract images and formulations with which economists typically worked were treated as real. Traditional public finance was economics pursued as statecraft: market transactions might enable people to achieve some desired outcomes in their lives, but fullness in the leading of meaningful lives required political action as envisioned through theories of public finance and welfare economics. Fiscal Sociology explained the scholarly poverty of orthodox public finance and sketched some contours of an alternative orientation for bringing useful insights about human nature to bear on using human intelligence on the organization of our public life.
In 2010 I published Mind, Society, and Human Action: Time and Knowledge in a Theory of Social Economy. This book sought to restate the material of orthodox equilibrium by rendering the passing of time and the acquisition of knowledge as pivotal features of all human action. These changes in orientation were in turn incorporated into an analytical framework where the prime object of the analytical effort was the society inside of which people lived and not some abstract individual who went through life solving a continual parade of optimization problems. Sure, it is reasonable to work with concepts of individual optimization, only these individual level concepts are deployed in an effort to render economic principles as inputs into rendering life in society intelligible and not as an end in itself.
In 2016 I published Politics as a Peculiar Business. This book encouraged Marta Podemska-Mikluch and Mikayla Novak to establish the Entangled Political Economy Research Network [EPERN: https://www.entangledpoliticaleconomy.org]. Economic scholarship since late in the 19th century had aimed at isolating an economy as an object that operates independently of society. This is the idea that economy, polity, and society are distinct objects with their individual principles of operation. Entangled political economy recognizes the absurdity of the standard presumption by recognizing that commerce and politics are propelled by people who know one another, were schooled with one another, and who can be useful to one another. This alternative, entangled vision of social reality, moreover, was alive among the philosophers of the Scottish Enlightenment.
In 2020 I published Macroeconomics as Systems Theory: Transcending the Micro-Macro Dichotomy. Publication of this book signaled completion of my transformation from being driven by a concern for my scholarly existence to being driven by a concern with what all this scholarly activity is all about. In 1990 the noted sociologist James Coleman published Foundations of Social Theory. There, Coleman depicted societies as entailing two levels: one level contained individuals and their actions; the other level contained a plethora of statistics, projections, and ideologies. There can be no action on the social or aggregate level because that level features only an endless variety of emergent results of interactions among people at the individual level. We live inside societies about which we typically have opinions of all sorts. Those societal features, however, are emergent products of complex patterns of interaction and are not direct objects of political choice. Political figures, even Presidents, act inside society and not on society as an entity.
Between 2007 and 2020 I came to realize that economics had transformed from an instrument of individual liberty into an instrument of allegedly benevolent oppression, along the lines of what Alexis de Tocqueville sketched in his chapter on “Democratic Despotism” in Democracy in America. This transformation resulted not from some singular choice in favor of despotism but was the emergent product of numerous choices by citizens and politicians, all of whom were seeking to wreak themselves upon the worlds they experienced. This transformation happened step-by-step over a century. Imagine two friends standing a half-mile apart along the equator. They can barely see one another and then start walking north in parallel. At some point they will recognize they are getting ever closer to one another. This is how it is with social transformation. In 1776, the American Republic was founded on the principle of individual liberty with a limited scheme of government to support that liberty.
The Constitution of 1787 did nothing to change the Declaration of Independence of 1776. The American Republic was dedicated to liberty though not for slaves, a difficulty to be explored in later work. The intellectual currents in play at the time of the Declaration and the Constitution were those of the Scottish Enlightenment. Those Scottish thinkers recognized that societies exhibited generally orderly and intelligible features and sought to explain how this could happen when there was no external source of authority who was dedicated to bringing this about. The Scots recognized that human nature itself contained the seeds that could sprout into self-governing republics.
That nature entails desires to pursue projects and manners of living that make for meaningful patterns of living among the members of society. This idea is often reduced to a doctrine of self-interest, which, as with most reductions, can easily be misleading. After all, an “interest” is something only a self can have, so selves can be actuated only by what excites or interests them. It is fatuous to speak of such terms as narrow self-interest or enlightened self-interest because those terms refer only particular personalities. For instance, Albert Schweitzer and Adolph Hitler were both Germans actuated by their different interests. All people are inescapably self-interested, only people differ hugely in how they choose to conduct themselves.
The Scots emphasized approbation as a common feature of human nature that does much of the work in generating the observed orderliness that is common to all societies. But envy and jealousy are also latent features of the human personality, and these emotions can prevent societies from becoming boringly bland while also promoting turbulence. All the social mammals exhibit leadership while living in groups. Humans are no different, save that humans have a facility for mendacity that other mammals seem to lack. In his “The Wolf in the Parlor”, Jon Franklin describes a pack of wolves attacking a moose. The wolves might bring down the moose, but they will suffer casualties along the way. The healthy wolves will nurse and feed the injured wolves; moreover, the injured wolves will do their best to return to health. One wolf might be left with three legs but will do its best to act as a wolf; there will be no malingering among the wolves, unlike with humans. Mendacity is a quality that seems resident only among humans.
The Scottish philosophers recognized that the source of good order within society rests within our own natures and is not something that can or must be imposed by some outside authority. The classical political economy that took shape in the 18th century sought to articulate the limited place for political action in living well together. By the middle of the 19th century, economists were seeking to make their field appear more scientific to fend off the coming of socialism and to expand the prominence of economics. To assist this urge, many economists turned to mathematics and physics, and the marginal revolution was born and what became called neo-classical economics displaced the classical orientation initiated during the Scottish Enlightenment.
In many respects, we are what we think. No thinker can truly apprehend the society that is the object of analytical interest. That object can be apprehended only through the construction of models that are thought to capture the salient features of that reality. A model that has lions lying down with sheep will map onto a presumption of social equilibrium, but it will not provide any useful illumination about the varieties of ways people might live together in society, which has nothing to do with any image of a peaceable kingdom.
Can you believe that individual action follows law-like patterns while also believing that the enormous variety found historically among societies likewise is subject to law-like explanation? To this question, I answer a resounding YES, and for support cite Henri Bergson’s (1907) Creative Evolution. Bergson recognizes two features about society that I any breathing person would recognize and which are incongruent with ordinary theories of equilibrium and optimality: (1) people are continually experimenting and (2) novelty is continually being injected into society, disrupting settled social patterns in the process.
As for a final word on social philosophy, I think the formation of the United States in 1776 and 1787 is an extension of the western legal tradition of individual liberty that Harold Berman (1983) documents in Law and Revolution. There, Berman explains how a legal tradition surrounding the resolution of disputes among people emerged throughout the western world starting around 1100 and continuing until about 1900, when the contours of that tradition began to recede, and due to forces latent in humanity that the ancients would have understood: self-deception and mendacity. My article of faith in what is at base a scientific enterprise is that a society of free and responsible individuals can be renewed through a deeper and clearer understanding of both the virtues and the challenges of living inside free societies within a world where societies of all forms exist.
This challenge is, in my estimation, far more a matter of engaging in modes of scientific analysis suitable for the human sciences than engaging in opinion editorial types of disputation. There is a reality out there; it is not optional. However, that reality is complex and not directly observable, as Edwin Abbott (1884) recognized in Flatland. Using inapt theories to guide us can lead us far astray. For example, a propeller driven aircraft flown through a storm will naturally return to level flight so long as its engine is running. Someone who encounters a downdraft and seeks to correct by pulling up on the stick can cause a stall and even cause the plane to crash, all due to applying an inapt theory to the situation.