We continue our chapter-by-chapter reading of David Boyle’s study guide, “Small is Beautiful Revisited…50 Years On,” which examines Schumacher’s 1973 landmark text in light of our own time. The guide has been sparking generative discussions in college classrooms, workplaces, and circles of contemplation. (Each chapter guide is available on our site in addition to a full downloadable PDF.)
Chapter 11 addresses the prevailing logic of international development. Building on questions raised in the earlier chapters, Schumacher is able here to pose what he calls “the central problem of development.” Expressing an understanding of economic development as “evolutionary” rather than “comprehensively planned,” Schumacher offers a holistic, sustainable development ethos applicable in any given context.
As our guide David Boyle explains, this ‘big idea’ chapter sets up the next several to come.
Excerpt from the Guide to Chapter 11
For two-thirds of mankind, the aim of a ‘full and happy life’ with steady improvements of their lot, if not actually receding, seems to be as far away as ever…
— E. F. Schumacher, clear statement near the beginning of Ch. 11
Another stumbling block is the belief that [greater] self-reliance in the North would undermine the economies of the ‘Third World,’ where people supposedly need northern markets to lift themselves out of poverty. The truth of the matter is that a shift toward smaller scale and more localized production would benefit both North and South, and allow for more meaningful work and fuller employment all around.
Today, a large proportion of the South’s natural resources is delivered to the North… in the form of raw materials. The South’s best agricultural land is devoted to growing food, fibers, even flowers for the North… Rather than further impoverishing the South, producing more ourselves would allow the South to keep more of its resources and labor for itself.”
—Helena Norberg-Hodge, founder of Local Futures, in the 25th anniversary book, (1999).
As in the book’s last section, Schumacher deals with an introductory big idea in the opening pages, this one at the beginning of a section he calls the ‘third world’ – but which we will refer to as the global south.
His remarks were taken from an ‘anniversary address’ he gave at the general meeting of the Africa Bureau in London in March 1966.
What the Chapter Says…
Schumacher begins by quoting the definition of development used by the UK government in their 1965 white paper on development policy:
To do what lies within our power to help the developing countries to provide their people with the material opportunities for using their talents, of living a full and happy life and steadily improving their lot.
What is wrong with this? “Nothing,” says Schumacher, “except it is hopelessly optimistic.”
“To do what lies within our power to help the developing countries to provide their people with the material opportunities for using their talents, of living a full and happy life and steadily improving their lot.”
What is wrong with that, you may ask? Nothing except that it is hopelessly optimistic. As Schumacher says, there “may have been some disillusionment..?”
Then he explains why this matters – because nobody in authority appears to notice the two different worlds in the global south. This is what he calls the ‘dual economy’:
“There are two different patterns of living as widely separated from each other as two different worlds. It is not a matter of some people being rich and others being poor. both being utilized by a common way of life: it is a matter of two ways of life existing side by side in such a manner that even the humblest member of the one disposes of a daily income which is a high multiple of the income accruing to even the hardest working member of the other. The social and political tensions arising from the dual economy are too obvious to require description.”
Schumacher says he puts the under-educated basic class, in rural areas, at an average of around 85 per cent of the population. The educated urban class makes up around 15 per cent.
How long will it take for the 15 per cent to drag the 85 per cent up to their level, Schumacher asks? And he answers his own question with an emphatic: “They never will.”
“Could it be that the relative failure of aid, or at least our disappointment with the effectiveness of aid, has something to do with our materialist philosophy which makes us liable to overlook the most important preconditions of success, which are generally invisible?” he asks:
“Or if we do not entirely overlook them, we tend to treat them just as we treat material things – things that can be planned and scheduled and purchased with money according to some all- comprehensive development plan. In other words, we tend to think of development, not in terms of evolution, but in terms of creation… Our scientists incessantly tell us with the utmost assurance that everything around us has evolved by small mutations sieved out through natural selection. Even the Almighty is not credited with having been able to create anything complex. Every complexity, we are told, is the result of evolution.”
Either way, the effect of dual economy is that money is sucked out of the rural areas, so that the poorest people in the world have to leave to go to the cities in search of work.
“We may observe in passing that similar tendencies are at work even in some of the richest countries, where they manifest as a trend towards excessive urbanization, towards ‘megalopolis’, and leave, in the midst of affluence, large pockets of poverty-stricken people, ‘drop-outs’, unemployed and employable.”
Now he gets down to explaining why:
“Until recently, the development experts rarely referred to the dual economy and its twin evils of mass unemployment and mass migration into cities.
Worse, says Schumacher, it is likely to decline further:
“Meanwhile, it has become widely recognized that time alone will not be the healer. On the contrary, the dual economy, unless consciously counteracted, produces what I have called a ‘process of mutual poisoning’, whereby successful industrial development in the cities destroys the economic structure of the hinterland, and the hinterland takes its revenge by mass migration into the cities, poisoning them and making them utterly unmanageable.”
Forward estimates made by the World Health Organization and by experts like Kingsley Davies predict cities of 20, 40 and even 60 million inhabitants. It is “a prospect of ‘commiseration for multitudes of people that beggars the imagination,” says Schumacher.
The ruling philosophy of development over the last twenty years has been: ‘What is best for the rich must be best for the poor.’ This is clearly nonsense:
“This belief has been carried to truly astonishing lengths, as can be seen by inspecting the list of developing countries in which the Americans and their allies and in some cases also the Russians have found it necessary and wise to establish ‘peaceful’ nuclear reactors – Taiwan, South Korea, Philippines, Vietnam, Thailand, Indonesia, Iran, Turkey, Portugal, Venezuela – all of them countries whose overwhelming problems are agriculture and the rejuvenation of rural life, since the great majority of their poverty-stricken peoples live in rural areas.”
Then, as if by magic, he comes up with three words which he believes the freedom to work in any society requires: education, organization, and discipline.
“There are prosperous societies with but the scantiest basis of natural wealth. and we have had plenty of opportunity to observe the primacy of the invisible factors after the war. Every country, no matter how devastated, which had a high level of education. organization, and discipline, produced an ‘economic miracle’. In fact these were miracles only for people whose attention is focused on the tip of the iceberg. The tip had been smashed to pieces, but the base, which is education, organization, and discipline, was still there.”
“Here, then. lies the central problem of development. If the primary causes of poverty are deficiencies in these three respects, then the alleviation of poverty depends primarily on the removal of these deficiencies. Here lies the reason why development cannot be an act of creation, why it cannot be ordered, bought, comprehensively planned: why it requires a process of evolution. Education does not ‘jump’; it is a gradual process of great subtlety. Organization does not ‘jump’; it must gradually evolve to fit changing circumstances. And much the same goes for discipline. All three must evolve step by step, and the foremost task of development policy must be to speed this evolution.”
After describing what Chapter 11 says, David Boyle goes on in his Study Guide to give a sweeping summary of global development trends since the 1970s— weighing where Schumacherian values have been advanced, and multiple instances where global institutions continue to fall short.
To explore more deeply the themes put forward in Small Is Beautiful, visit our new Decentralism File: featuring 120+ heuristic selections of decentralist thought spanning 2,500 years.