HES, Colorado, 2009
Hawtrey*
— On His Unpublished Book, Right Policy
Toshiaki Hirai (Sophia University)
1. Introduction
Ralph Hawtrey (1879-1975) is well-known as an economist who developed a monetary theory of the business cycle1. He is also famous for providing a theoretical basis for the so-called “Treasury View”2, and thus as an economist who took a firm stand against Keynes. Moreover, he developed a clear-cut critical argument on Keynes as the author of the Treatise.3 Leaving these relatively well-known aspects for other occasions, in this paper I would like to focus on his social philosophy, now sunk in oblivion4.
Hawtrey was brought up in the intellectual environment of Cambridge, where, among other things, he became an “Apostle”.5 He did not go on to live and work as a researcher at Cambridge, but entered the Treasury, working as the only economist there until retirement. Although he published two books on social philosophy (The Economic Problem [Hawtrey, 1926. Hereafter EP]6, and the Economic Destiny [Hawtrey, 1944. Hereafter ED], in this paper we will focus on his last, unpublished book, Right Policy: the Place of Value Judgments in Politics (Hawtrey Papers, 12/2. 528-page type-written manuscript composed of eighteen chapters. Hereafter RP).
Right Policy is a book which critically examines the areas of economics, sociology and politics, putting the foundation on Moorean ethics, among others (??) working on the foundations of Moorean ethics including, among other aspects, (??) “the impossibility of the definition of the Good”. “Value judgments” in the subtitle means judgments with a view to “true ends”.
Right Policy is structured as follows. Chapters I, “Ends”, II, “The Good” and III, “The Philosophic Religion” discuss ethical issues, while politics and sociology are the subject matter of Chapters IV, “Government”, V, “Freedom” and X, “Class”. Chapters VI, “Economic Fundamentals”, VIII, “Labour”, and IX, “Questions of Distribution”, deal with various aspects of economics. In Chapter VII, “Capitalism and Collectivism”, comparative systems are addressed, while in Chapters XI, “The Balance of Power”, to XVII, “A Concert of Great Powers”, the sphere of international politics is dealt with (Chapter XII “Colonies”, XIII “The War Problem”, XIV “Communism and Nationality”, XV “Power Politics and Ideology”, XVI “Conditions of Peaceful Coexistence”), and finally Chapter XVIII sets out the “Conclusion”.
The present paper runs as follows: In section 2 we consider the main theme of Right Policy, and in section 3 we take a look at the “Theory of Aspects”. Section 4 deals with Moorean ethics, while sections 5 and 6 respectively discuss Hawtrey’s view on society and the economy. In section 7 his theory of world peace is addressed.
2. The Main Theme
The title, “Right Policy”, implies man’s behaviour not among individuals but in relation to a community.7 “Man” here does not mean the public but a “leader (ruler)” and the stress is placed on the obligations which he/she should assume. It is argued that a leader responsible for implementing public policy is different from a citizen, and should base all his/her behaviours on the ultimate evaluation of the Good8, not being content with “intermediate ends”. The latter refers to the means through which a citizen should make his/her living, the risk being that they might become “false ends”9 “[w]hen these intermediate ends are allowed to dominate action, without regard to qualifying circumstances or consequences” (RP, p.528).
The only end (ultimate aim) which pure reason should recognize is the Good10. The “right” ends – an antonym of the “intermediate ends” - which a leader should pursue are the “good” ones, so what exactly is meant by “the Good” needs to be clarified. 11
When faced with the problem of “the Good”, Hawtrey follows Moore’s dictum on the “impossibility of the definition of the Good” 12, which implies that it can be intuitively discerned by the mind. Hawtrey puts this Good at the foundation of his social philosophy.
… in the last resort there is no substitute for the Good as the ultimate foundation of the moral code and of the principles of all human behaviour (RP, p.136).
He does not, he declares, intend to define “right ends” (and thus “right policy”) 13, but believes that man is able to distinguish right policy. The Good is “within the reach of the intelligence of all human beings” (RP, p.136), and yet is held to be objective. He thinks that in order to find the Good man does not need to be led by philosophy, but can only appeal to everyday judgment.
We are not used to reflecting about the Good, and about the relation of means to ultimate ends, but our judgments involving it pervade all practical life, so that a moral code built on it has firm foundation (RP, p.136).
… the Good is not merely Good for him. His experience is an experience for him. His experience is an experience for him, but the attribute good is inherent in the experience, and is not just relative to him… . and the individual who experiences it is merely the channel through which it is realised (RP, p.69c).
In the Preface to Right Policy Hawtrey states the purpose of the book, which is to help in clear thinking about the political and social problems through an appeal to “a sense of value inherent in human consciousness”. When he says that he cannot define the “rightness” and “goodness” of Right Policy14 (and yet he insists that the attribute “Good” can extend to other states of feeling such as “aesthetic pleasures”, “intellectual pleasures”, and “human values”15), but that man can distinguish it through intuition (based on the foundation of moral code), one cannot help being left with the impression that precisely what the ends are is left to the judgment of the readers from the outset.
3. The Theory of Aspects
Hawtrey’s philosophy might as well have been named “The Theory of Aspects” (since his youth he had cherished “Aspect” as a fundamental concept.16). It is in fact treated in RP, pp.42-53, but it is discussed in more detail in Thought and Things, his only and unpublished book on philosophy (Hawtrey Papers, 12/1. A 314-page typescript composed of eight chapters; hereafter TT) .
The main theme of TT is “analysis of thought into the discernment of aspects in conscious experience”. TT uses a method of “introspection” and argues that the mind discerns aspects as a basis. By aspects Hawtrey means elements intrinsically existing in things, but as a potentiality. They do not become reality until they are discerned through conscious experience of mind.17 Let us take the case of people looking at a certain picture. Some might discern “delicate beauty” in it, others “delicate shadow”. Delicate beauty and delicate shadow are aspects which intrinsically exist in that picture, and are realized through each individual’s conscious discernment.
Aspects cannot be separated from a thing as a whole. Although “delicate beauty” exists in the picture, and comes to realization through the conscious discernment of the mind, it cannot be separated from it. Aspects thus obtained are accumulated within the mind. When it makes judgment, the mind will, in turn, make constant reference to a storage of aspects.
In this philosophy, man’s mind, if not complete (??) although incomplete in itself (??), is held to possess the ability to discern and appreciate the aspects of a given object. The mind comes to discern various aspects – an aspect of sense experience, feeling and sentiment, thought, and so forth.
“Behaviorism” and “Materialism” are objective philosophies in that they claim that things and phenomena can be explained as independent of the mind. By contrast, Hawtrey’s philosophy belongs to the area of empiricism, and stands mid-way between objectivism and subjectivism. It is founded on the individual’s ability of appreciation and aspects (??) to appreciate aspects, considered to exist potentially in things, and is in sharp contrast with behaviorism and materialism, which disregard the mind. He is also critical of “Scientism”, which claims that all phenomena can be explained in terms of things, pointing out its limitations from the same point of view he takes in criticizing behaviorism and materialism.18
It should be noted that Hawtrey’s epistemology differs from Moore’s. In the case of Moore we have the so-called “sense data” between things and mind. The mind is held to appreciate things, through sense, in the form of sense data.19 In the case of Hawtrey, contrastingly, aspects are considered to exist potentially in things.
4. Moorean Ethics
In the early twentieth century it was Moore who exerted an extraordinary influence on Cambridge’s most excellent students, who gathered together in “the Society”.20 Hawtrey was not only one of them (an apostle) but also firmly maintained his own system of ethics (Moorean Ethics) as the foundations of his philosophy and ethics throughout his life.21 Naturally Moorean Ethics form the foundations of Right Policy. Such persistency is not to be seen in the other Cambridgeans who were also deeply influenced by Moore.
The Good can not be defined, and can be grasped only through intuition --- this is the famous “impossibility of the definition of the Good”. It is to this Good that Hawtrey attaches the greatest importance.
I think the world has most reason to be grateful for his [Moore’s] emancipation of the attribute Good from the obscurities and dubieties of philosophy (RP, p.4).
It is worth noting that in RP liberty is regarded as not so much as the highest end as, rather, an intermediate end, for although liberty is considered a high ideal, granting human capacities, which hope for multiplicity (??) which strive in manifold directions, a vast range of opportunities, it is not a true end.22
So let us consider these intermediate ends. Hawtrey states that a “Code of conduct or moral code” presents various intermediate ends as practical guidance, mentioning “honesty, good faith, kindness, respect for property, for the family, for authority, and for personal rights and feelings”23 as well as instinct and the “system of rewards and punishments”.24 Hawtrey accepts the necessity of intermediate ends in the real world, and yet warns that, taken to extremes, they might turn into “false ends”, mentioning as examples “the desire for material possessions” (against which is proposed a moral principle of shared satisfaction)25, “the desire for money” (which injures (??) which clashes with (??) other, higher feelings), “safety” (which might prompt the feeling that punishing criminals is in itself desirable) and “egoism”.
Hawtrey argues that a leader should examine intermediate ends as an object of criticism.
[An existing moral code] can itself be only a code of intermediate ends. The existing code itself must be open to criticism, … No political principle is exempt from this criticism, not Justice, Liberty or Security (RP, p.72a).
5. Social Perception
From his philosophical stance as outlined above, then, how does Hawtrey view society? The key words there are “leader (ruler)” and “theory of evolution”.
5.1 Leader (Ruler)
Whenever he speaks of society, Hawtrey argues that there exists power, a leader (ruler)26, who possesses and uses power, and the public who follow him/her. Moreover, he attaches importance to a leader (or a class of leaders27) as indispensable for maintaining the society. Terms such as “authority” and “power” should turn up in relation to him/her (??) are normally (naturally, inevitably??) associated with him/her. (??)
authority is conceded to the leader as ruler conditionally. The community becomes an instrument in his [leader’s] hands. The members of the community accord him loyalty and obedience on condition that he so uses this instrument as to further their individual ends (RP, p.21).
This is true whatever form a society might assume. A democratic society is no exception. Through elections the public entrust the exercise of power to parliament, which possesses authority and gives orders (??) makes laws (??). The public will accept the transfer of power as long as the orders (??) do not deviate from the norms/conventions of society. That is democracy.
The aim of democracy is to supersede that right of rebellion, which is the only remedy of discontent against an autocratic or oligarchic government, by a system of control residing in the whole mass of people (RP, p.108).
“[The community] requires conscious direction in its handling” (RP, p.20) is primal for Hawtrey’s social perception. With the public’s approval of a leader, conscious direction on the part of the leader loyalty and obedience to him/her on the part of the public, a path is ready for the rationalization of a group’s action. Hawtrey holds that a society lacking such a leader will tend to fall into confusion.
This perception underlies his argument on Collectivism (see Section V), and on the world as a whole (see Section VI). The early 20th century saw a theory of elite (a leader sociology)28 in vogue: we cannot tell whether Hawtrey was influenced by it, but there is a strong possibility.
Hawtrey emphasizes that there exists a moral code which the people conventionally observe, and without which the maintenance of order would be impossible. Even a leader is required to observe it in order to maintain his/her position.
5.2 The Theory of Evolution
In Hawtrey’s perception of society, ideas based on the theory of evolution29 find an explicit place. The human mind had not been a perfect instrument for thought and
knowledge from the outset, but evolved under the pressure of natural selection as a means of adjusting the living organism to the circumstances.
The human mind’s principal function there (??) then (??) was to memorize the physical circumstances, and to determine the appropriate action through “instinctive propensity”.30 Then, he argues, “once fully developed, [it] has opened the way to a far more rapid process of social evolution, in which instinctive reactions have been supplemented by conscious planning” (RP, p.4). Human being is an entity in which rationality is added to animal instints.31
Human evolution is above all an evolution of consciousness. Consciousness itself has a high survaival value. … When the progress of physiological evolution has equipped man with a brain capable of systematic thought, conscious planning becomes possible (RP, p.11).
The human mind as it is now is the result of fostering through the evolutionary process of natural as well as of social evolution. The mind itself is an existence which goes on evolving. As the mind thus evolved became capable of developing a systematic way of thinking, “conscious planning” could be introduced into society. Thus, Hawtrey argues, society has come to evolve at an increasing pace.
If the above is an explanation of the evolution of human beings in the pre-historic era, “rationalisation” is the term used to explain the subsequent working of the human mind. Rationalization is considered a process in which religious disciplines prove susceptible to clarification by “Reason”. Due to this process, those mysterious elements of religion which captivated the people decreased, and the areas which they could understand by means of Reason increased. Things and phenomena which they blindly believed (??) took for granted (??) became comprehensible thanks to Reason. Thus “rationalisation”32 is a development of a kind of rational philosophy, and an infiltration of the Philosophy of Enlightenment.
Mind, once evolved, is free to think of all things, including its own states of feeling. When these are judged desirable, and the mind discerns right means to right ends, the way is open to rational action (RP, p.69a).
A rational act is directed to a purpose or end. Rationality requires the
selection of the right means to attain given ends, but it involves something more. The ends themselves must be right ends (RP, p.3).
As human society and the conscious mind evolve, human beings come to be aware of a problem of the “Good”, and turn their minds to the problem of what ethical values are.
The search for an ethical criterion in evolution bears fruit because human society in this phase of evolution is awake to the good (RP, p.9).33
6. Economic Perception
In this section we will look into Chapters 6-10, where the main theme is to “apply the ultimate criterion [of the Good] to economic problems” 34. Here, among other things, “economic ends” and “economic justice” are dealt with.35 The most salient feature in Hawtrey’s economic perception is the emphasis on the “Good” as the ultimate end. Another point to be dealt with here is “comparison between Capitalism and Collectivism”.
6.1 Economic Ends
The fundamental criterion in Hawtrey’s economic perception is classification of final products into “utility products” and “plus products”.36 Utility products are products indispensable for making living (??) for making a living (??) for living (??), sustaining life and protecting the people from injury, pain or discomfort, while plus products are designed to afford some positive benefit or enjoyment. Hawtrey argues that if economic activities could make some positive contribution to “true ends”, it should be sought in (??) it should be through (??) plus products,37 while warning, however, that the end of plus products must not be identified with the Good (i.e. human values do not depend on plus products).
Hawtrey always sees final products from these points of view, so “value judgments” in his sense are incessantly involved. He is critical of the Marshall= Pigou methodology in which the object of economic analysis should be confined to economic welfare, and tries to evaluate economic activities in relation to “the Good” as a true end. When he states that plus products contribute to “right ends”, in the Theory of Aspects it is presupposed that “aesthetic pleasure” or “intellectual pleasure” which consumers appreciate is brought about.
Naturally, plus products have their market values because they are transacted in the markets. Final products which go over utility products are plus products, which will link economic activities to attainment of “the Good”. However, the divergence between the intrinsic value and market value of plus products is too wide. Hawtrey does not give an explicit answer to how the gap can be bridged.
The market value of a work which is destined eventually to be recognised as of transcendent merit, may thus be very low. And, even when recognition attributes a high cash value to such work, the cash value cannot be taken as a measure of its intrinsic merit. Cash value has very little bearing on the aesthetic or intellectual value of plus products (RP, p.159).38
Hawtrey considers that whether economic activities can contribute to attainment of the Good depends on how plus products can develop.
He also sees education from this point of view.
… the aim of education should be to extend to all people the sense of values, the power of appreciation, appropriate to a governing class.… a sense of values, that is to say, of right ends (RP, p.303).
… much of education may be treated, like care of health, as a utility product.… As soon as education proceeds beyond these limits, the plus aspect begins to predominate. When education inculcates good manners and sound morals, it prepares the way for human values, and, when it develops literary, artistic and scientific tastes, it opens up the appreciation of the higher levels of plus products (RP, pp.290-291).
However, Hawtrey’s treatment of plus products seems to be ambiguous. On the one hand, the value of plus products is argued to lie in its (??) their (??) artistry (??) aesthetic qualities (??), so that it depends on the people who can appreciate it. On the other hand, plus products are goods which can be transacted in markets, so they are also – inevitably – evaluated in terms of buying and selling in cash. There is a very wide gap indeed between their intrinsic and market values, and this gap cannot be easily bridged, even if people’s appreciative faculties improve, for there exist plus products whose aesthetic values have no relation to the cash values. Hawtrey seems to miss the essence of the market transaction in the context of the capitalistic economy by straining too much after the ethical and aesthetic aspects of plus products in relation to the “right ends”.
In “The Demand for Plus Products” (RP, pp.274-278a), plus products are argued to differ from each other according to the differences in marketing method. It is pointed out here that, unlike aristocratic society in which affluent patrons held sway, industrial society is essentially middle class. Hawtrey seems to take a pessimistic and ambiguous approach to the demand for plus products in the latter society.
Hawtrey argues that in the market economy the function and ability of dealers achieves particular prominence as compared with those of the other economic agents. Indeed, he stresses just how crucial the role of dealers is in selling. The market organization is “composed of traders, dealers in commodities who specialize in buying and selling and are ready to deal with all comers”(RP, p.180), and “[t]he making of a price which equate (equates??) supply and demand is an important part of the services rendered by the dealers in a market, but by no means the whole” (RP, p.181). On the other hand, consumers are liable to be lacking in these abilities.39 It is Hawtrey’s fundamental view that there is, therefore, a difference in abilities among economic agents in a market.
This point is important, and yet dealers (will??) have some difficulty in bridging the above-mentioned gap. Even if consumers could succeed in leveling up their faculties of appreciation on plus products, it remains an inescapable fact that the possibility of contributing to narrowing the gap will be small in view of the definition of the value of plus products.
The development of the capitalistic economy has brought about products far beyond the products necessary for survival. However, they cannot be said to be plus products according to Hawtrey’s definition: they are (for example??) in the areas of electronics, medicines, and automobiles (Durable goods are classified as utility products40). The most innovative technology is applied in the production of these goods. They have contributed to amazing improvements in the comfort and convenience of life. And they have also seen dramatic progress in design, as well. It is profitability in a market, however, that is finally decisive for the growth of production of these products, and this profitability largely depends on the degree of increasing returns to scale. Approaching the modern capitalistic economy from the point of view of plus products which have aesthetic values in relation to the right ends, as Hawtrey tried to do, might well be deemed a reckless or fantastic venture.
6.2 Economic Justice
Hawtrey lays particular emphasis on “economic justice” together with “economic ends” in application of the Good as ultimate end to an economic problem. “Economic Justice” is an intermediate end”, so that, taken to an extreme, it could fall into the category of “false ends”.41
Economic justice is part of the moral code. When it is applied to a system in which society works, it becomes a moral obligation for a leader.42
Economic justice requires that there be no arbitrary discrimination among persons in the distribution of resources, but it also requires that the rules governing distribution be good rules (RP, p.172).
Hawtrey shows two systems of distribution － “a system of rewards” and “a system according to needs”.43 The former is a system in which the equivalent to an individual’s production is due to him/her, and it is adopted in capitalistic society. The latter is a system which communist society contemplates as an ideal.44
Economic justice is required as a compromise between the two systems. On the one hand, justice is a concept which prohibits arbitrary inequality among individuals.
“[Justice] must be so understood that what is just is right. The rules to be conformed to must be good rules”(RP, p.169).
Therefore, a leader must render social services, by way of distribution “according to needs”, to those who cannot meet their needs by themselves. On the other hand, if justice should is taken into consideration in the system of rewards, the expectations aroused by it should not be betrayed. This, too, is a moral obligation that a ruler must accept.45
Thus, when social services are provided, one cannot determine where the concept of justice should be situated between the two systems. Hawtrey draws the following conclusion on this point.
Distribution according to need provides a certain standard for those who for any good reason cannot secure it by their own earning power, and the rest of the available output is distributed in the forms of the equivalent of each person’s contribution to it, subject to the appropriate deduction of taxation (RP, pp.172-173).
6.3 Capitalism and Collectivism
How does Hawtrey rate Capitalism and Collectivism46, the latter ruling out private firms and providing for collective ownership?47 The following sums up his evaluation.
(1) Economic adjustment by means of monetary policy is easier in Collectivist system than under Capitalism. In the latter case the government can only make indirect adjustment to the movement of the credit economy and has some difficulty in, as it were, redressing the balance on a razor (??) a razor’s edge (??). Contrastingly, Collectivism is free from this difficulty.48
In passing (??) Incidentally (??), the objective of monetary policy is put on the stability of prices (??) to achieve stability of prices. Hawtrey’s account here reminds us of something like the quantity theory of money.
(2) In Collectivism innovation and the creation of innovative firms are difficult due to the nature of the system which depends on bureaucratic machinery.49 Contrastingly, in Capitalism what to produce is left to the entrepreneurs, and the number of choice exists as many as entrepreneurs (??) and there are as many choices as there are entrepreneurs (??).
In Collectivism accountability to the authority might prove a great bottleneck. Even if high-ranking officials sought advice from specialists, they might be inclined to think that innovation could be a dangerous deviation from the routine course.
(3) Even Capitalism could draw near Collectivism through progressive tax correct the inequality deriving from profit and land ownership.
Collectivism has an advantageous point in (1), Capitalism in (2). With regard to (3), Capitalism can come close to Collectivism.
Having established so much, on which side would Hawtrey stand? Although he makes no explicit judgement in Right Policy, we may point out that he has evidently moved closer to the right in the political spectrum than he had been in the Economic Problem or Economic Destiny.
7．The View of World Peace (??) His Views on World Peace (??)
In Right Policy many pages are devoted to the world political situation. Among other issues, there is much reference to the Cold War, the Suez Crisis and the Korean War, and Hawtrey was keenly aware of the weak position the United Nations found itself in.
When Hawtrey speaks of the world, it is the “balance of power” that is taken as a central concept ― the balance of power among independent nations50 – a means of attaining world peace. Hawtrey argues that “power” always exists in any type of society. Every nation possesses power, and independent nations are always potential enemies to each other.51 Viewing the world, Hawtrey always regards it as a society in which there exists the ruler and the ruled, as well as an authority.
The political situation in which there exist only independent nations is a kind of “International Anarchy”52 in terms of Dickinson53 and cannot keep the world at peace. Hawtrey contemplates peaceful co-existence by means of “the genuine co-operation of the great powers” as a way of escaping from this situation.54
Co-operation by the great powers means co-operation in the application of principles which will take the place of war in adapting the international system to changing conditions. It is these principles that they must agree upon if war is no longer to be an institution (RP, p.467).
“War” is, according to Hawtrey, an “institution”55 which has so far played an essential role in the adaptation of society to changes, and is action negating the pursuit of the Good. 56 Consequently Hawtrey wished to see the United Nations revitalized as the means to attain world peace.
Once the requisite agreement and co-operation [among the Great Powers] have been assured, the United Nations Organisation will be at hand to provide the instrument of action, and the world will not want to incur delay in using it by waiting for the elaboration of a constitution (RP, p.466).
8. Philosophical Development in Cambridge57
We have examined Hawtrey’s social philosophy through Right Policy. How did he respond, then, to the prolific philosophical output generated at Cambridge? This is our theme in this section. The starting point might be (??) is to be (??) found in Moorean Ethics, which exerted both “positive” and “critical” influences.
8.1 Positive Influences
The most conspicuous feature of Morrean Ethics lies in “the impossibility of the definition of the Good”. Arguing that the Good cannot be defined, and that it is naturalistic error to try to define it in terms of other concepts, he had great impact on the then established ethics. The Good is good, so it can neither be replaced with other concepts nor be decomposed. How, then, can the Good be discerned? Moore’s answer was “intuition”. Human beings are equipped with it, and through it they can discern the Good. This is a point that Moore insisted on.
His view was to have profound influence on philosophical developments. We have already seen that Hawtrey entertained (??) embraced (??) it throughout his life.
Keynes was also greatly influenced by Moore’s views in the process leading up to A Treatise on Probability. It ????? what?? can be traced back to a criticism of Moore’s “Ethics in Relation to Conduct”. The definition of “probability” as “the degree of rational belief among propositions” in the Treatise is very Moorean, for this degree is argued to be obtainable only through “intuition”. The epistemology of “the impossibility of the definition of the Good” is applied to “probability”.
It is widely recognized that Moorean ethics had great influence on Keynes’s contemporaries including, among others, the members of the “Society” (??), or the members of the “Bloomsbury Group”, and the influence can be said to have been positive.
8.2 Critical Influences
Moorean ethics is characterized by intuitionism and objectivism. It also belongs to the area of cognitivism in regarding the Good as a fact.
Moorean ethics provoked criticism from the outset. The movement that went under the name of “Emotivism” and was to become dominant as meta-ethics in the 1920s-1950s was representative of this critical response. It argued that the Good is useful only as an emotional sign of (??) in (??) expressing one’s attitude,58 insisting that the Good should be understood as individualistic, and criticizing objectivism which fails to consider the possibility that intuitive discernment of the Good might fall into error.
Emotivism, advocated by Ogden, Richards, Stevenson and others, shared this view with “Logical Positivism”, which has “the principle of verification” as its motto, and argues that science should pursue either analytical propositions or positively verifiable propositions only, while all the rest should be regarded as metaphysics.
The representatives of Logical Positivism were Ayer and Robbins. Although Emotivism dwindled in the 1960s, Robbins’ methodology has continued to exert great influence in the field of economics to the present day, arguing that there lies an abyss between economics as positive science and ethics as normative science. It should be noted that Robbins’ stance is in sharp contrast with Hawtrey’s (and Hobson’s), which refuses to separate economics from ethics.59
There was also another strand in criticism of Moorean ethics, one representative being “the latter Wittgenstein”, who developed “the game theory of language”, which was succeeded by “the latter Keynes” as a philosopher. Keynes argued against Robbins, who regarded economics as science, that economics should be moral philosophy. We can understand this statement as made by (??) This approach is characteristic of (??) the latter Keynes.
The story does not end here. There was Ramsey, for example. In “Truth and Probability” (Ramsey [1926]) he radically criticized the early Keynes’s magnum opus, A Treatise on Probability, and put forward an alternative theory – the theory of subjective probability, known as the original source for the theory of decision making, and of rational selection. In this connection, Ramsey was influenced by Pierce’s pragmatism and J.S. Mill’s utilitarian psychology. Moreover, it is well-known that Ramsey, together with Sraffa, greatly influenced the formation of the latter Wittgenstein.60
Hawtrey was entangled in these torrents (??) strands (??) of ethics and philosophy. It was written after they passed over that Right Policy and his philosophical unpublished book, Thought and Things, were written??????. What we can say from reading them is that Hawtrey never abandoned Moorean ethics based on “the impossibility of the definition of the Good”, and stood by his own “Theory of Aspects”, both representing acquisitions of his youth. His stance on Moorean ethics differed from that of Keynes, whose early enthusiasm later matured into a more critical attitude.61
9. Conclusion
Hawtrey was probably (??) perhaps (??) the only scholar in Cambridge who tried to develop his thought as a system (THIS STATEMENT SEEMS A BIT EXTREME, TOSHIAKI). His well-known monetary theory of business cycle occupied only a part of his system. What he aimed at was to construct a system in comprehensively encompassing society. In this endeavor, Moore’s definition of the Good is taken as its foundation. “True ends” are related to it. A leader should concentrate exclusively on promoting them, while the public could live their everyday life aiming at “intermediate ends”.
According to Hawtrey, although “right policy” cannot be defined, it is a practical possibility to distinguish ends from means and make only what is good as ends the object of direct judgment, whatever right policy might be. What matters for the implementation of “right policy” based on the Good is the ability of human beings to discern “Rightness” intuitively. Hawtrey explains that human beings have come to possess this faculty both through the evolutionary process and with rationalization. A leader should incessantly verify “intermediate ends” from the point of view of “true ends” lest they should fall into “false ends”. In this respect, “right policy” is, par excellence, a philosophical and ethical problem which is required to make value judgments from the point of view of “true ends”. It was from this position that in Right Policy Hawtrey aimed at constructing a system for the critical analysis of a wide range of social and economic phenomena.
Notes
* The present paper is an English version of Hirai ed. [2009], Ch. 5.
1) Hawtery [1913] is his major work in this field.
2) He developed it in Hawtrey [1925].
3) He developed it in Hawtrey [1932], Ch.5?. The criticism developed here is based on Hawtrey [1928] and anticipated the argument in Keynes’s General Theory (this point seems to be almost totally disregarded, even now). See Hirai [2003], pp.334-336.
4) The only book so far published on Hawtrey is Deutscher [1990]. It deals with his contribution to macroeconomics, and does not refer to his social philosophy.
5) Like Leonard Woolf and Lytton Strachey (both born in 1980 and Apostles), Hawtrey, one year younger, was an ardent student of Moorean philosophy. A close study examination of Moorean philosophy is crucial in to an understanding of the nature and features of the thought of Keynes’s contemporaries.
6) Ch. 5, “Welfare and Value” of Hirai [2007] examines this.
7) See RP, p.1.
8) See RP, p.72. This view of the nation is reminiscent of Plato’s “Ideal Nation” in
that a philosopher-king, who can appreciate the “true” world, should rule the society in which the public are specialized in their jobs.
9) Similar views are argued in detail as “welfare and the false ends” in Hawtrey [1926], pp.185, 314 and Hawtrey [1944], Ch.12. “Welfare” here is identified as a “true end” in the sense Hawtrey applies to the term.
10) See RP, p.69d.
11) See RP, p.3.
12) See RP, p.4.
13) See RP, p.4.
14) The same is true of “welfare” in EP. It is an ethical term which itself includes good experience, and is considered to coexist with the Good as applied to the end. See EP, p.185.
15) See RP, pp.54-55.
16) For example, we may mention Hawtrey [1912] read at the “Friday Club”. TT originates from it (The title of chapter 1 is “Aspects”). Hawtrey states that his “aspect” comes close to Langer’s “form”, although he also notes some differences. See TT, p.52.
17) This might be related to Putnam’s “Immanent Realism”. “In Putnam [1987], he self-criticized Scientific Realism and Functionalism, and came to defend Pragmatism which interprets the reality of various objects in the outer world as closely linking with the cognitive agent’s interest and meaning. He energetically criticized Scientism to the effect that the truth is no more than a scientific truth” (Ito [1997], p.330).
18) See TT, pp.241-243, where Hawtrey discusses the fundamental difference between “the area of consciousness” (Hawtrey’s stance) and “the area of mechanical causality” (the stance of Behaviorism and Materialism).
19) Russell [1912] owes the core of his epistemology to Moore’s “sense data” (see “Sense-Data” [1910. In Baldwin ed. [1993]]). It is worth noting that Hawtrey’s “Aspects” mentioned above belongs to the same period. Later on Russell expressed the view that both mind and material should be treated as a series of events (see p.170) in “Mind and Material” (in Russell [1956]).
20) For example, see Russell [1956], pp.79-80 and Russell, Woolf et al. [1959].
21) See RP, p.4; TT, pp.100-105.
22) See RP, p.71.
23) See RP, p.37.
24) See RP, p.69d.
25) See RP, p.70.
26) Hawtrey compares a ruler to a gardener. See RP, p.62.
27) See RP, p.100.
28) For example, see Iyasu [2002]; Shionoya [1995], pp.208-211.
29) Hawtrey recollects that in his youth he argued, in Moore’s class (??) attending Moore’s classes (??), aesthetic and literary values based on the law of survival of the fittest (see TT, p.96). Although he accepted Moore’s intuitionism thereafter, he might have continued to take the law into account to some extent.
30) See RP, p.4.
31) See RP, p.9.
32) Interestingly, Hawtrey defines Civilization in terms of rationalization. “Civilisation is by no means to be understood as something wholly good. It can be nearly identified with the process of rationalisation of codes of behaviour. A nation is civilised in so far as it has the capacity of modelling and adapting its institutions and practices in accordance with deliberately planned means directed to conscious ends. Civlisation so defined is not an unmixed good, for the ends may be good or bad” (RP, p.314).
33) Hayek also discusses the formation of the “Spontaneous Order” (or “Rule”) in connection with the theory of evolution. However, the “Rule” is considered to be realized as the consequence of the people’s unintentional behaviors rather than through increase in rational cognizance (or the evolution of consciousness). Therefore, although both scholars use the concept of evolution, the use is different. See RP, p.180. On my view on Hayek’s theory of spontaneous order, see Hirai [2000], pp.299-301.
34) It is explicitly described in the Preface to RP.
35) See RP, p.153b.
36) In EP, products were classified into “defence products” and “creative products”, while in ED they were divided into “utility products” and “creative products”. In RP “creative products” are renamed “plus products”.
37) See RP, p.157.
38) In EP Hawtrey criticized an individualistic system (Capitalistic System) from the point of view of ethical value (welfare) as he understood it. He expressed the view that due to the weak power of appreciation of the people, the market value as determined in the goods market will mean deviation from its ethical value.
39) See RP, p.216.
40) See RP, p.277.
41) See RP, p.172.
42) See RP, p.172.
43) See RP, p.168.
44) See RP, p.211.
45) See RP, p.170.
46) See EP, pp.337, 390, 379 and ED, p.358. In EP Hawtrey points out that in an
individualistic system the activities of firms are motivated by making profits, as a result of which capital is accumulated and an excessive inequality of income distribution is brought about. The root cause lies, after all, in profit making, so that it is indispensable for the attainment of the true ends to abolish it. Thus Hawtrey hopes for a system which does not lay its foundations on profit making, abolishes money making (“Plutocracy”) as “false ends” and aims at attaining welfare as “true ends” through the state as its center --- that is, Collectivism. In passing, the paper (Hawtrey Papers, 6/5/2) which Hawtrey read before 1914 at Morley College (an institute for adult education in London) starts with the following sentence: “In theory at any rate Socialism is the natural sequel of democracy…”.
47) See RP, p.197.
48) See RP, p.250.
49) See RP, p.219.
50) In EP, Hawtrey extended his considerations to “power” besides money-making. Among other things, this is taken as a key concept for an understanding of events developing in the international scene. The competition among nations which constructed “interposts”, the competition for the possession of colonies, and the activities for conquest based on “national powers” paved the way to war. They evolved in such a way that the “Pursuit for Power” was closely linked to “Plutocracy”. Hawtrey warns that through fixation on “Action for Pursuit for Power” and “Plutocracy” they have come to be regarded as practical ends in spite of the fact that they are, in fact, “false ends”. In RP, he argues that we must change our way of thinking in being fixated on the “Pursuit for Power” and “Plutocracy” and need to turn the present peace, which in fact lies in a potential state of war, into “the Genuine Peace”.
51) See RP, p.495.
52) In ED, Ch.10 (“International Anarchy and the United Nations”), “International Anarchy” is mentioned as the major factor for the economic confusion in the interwar period.
53) Fry was Dickinson’s closest friend, and his sympathy was all directed toward Lowes Dickinson who fought to set up the League of Nations. See Woolf, V. [1940], p.272.
54) See RP, p.522.
55) See RP, p.357.
56) See RP, p.351.
57) The following is, to no small extent, owed to Davis [1994]. For emotivism, see also Wikipedia (English Version).
58) See Davis [1994], p.45.
59) Moreover, Hawtrey criticized Pigou’s Economics of Welfare, arguing that it confines welfare to economic welfare (see Hawtrey [1926], pp.184-185. Pigou’s rejoinder to this is to be seen in Pigou [1950], p.17, fn.3).
Robbins’s “impossibility of comparison among individuals” is also worth noting. With regard to Robbins’ criticism of Pigou [1920], Hutchison [1938] pointed out that if it were impossible to compare utilities among individuals, then it might be difficult to compare utilities within an individual.
In passing, the stance taken by Hawtrey and Hobson was endorsed by Tokuzo Fukuda. This is attributable to Fukuda’s distinction between “Economics of Price” and “Economics of Welfare” (see Fukuda [1922], p.169).
60) This does not mean that their views converged. Rather, they found themselves in a state of very sharp tension and antinomy. For the philosophical tension observed between Wittgenstein and Sraffa, see Kurz [2009].
61) This stance is true of his stance??? seen in economics.
Bibliography
Baldwin, T. ed. [1993], G. E. Moore: Selected Writings, Routledge.
Coates, J. [1996], The Claims of Common Sense: Moore, Wittgenstein, Keynes and the Social Sciences, Cambridge University Press.
Davis, J. [1994], Keynes’s Philosophical Development, Cambridge University Press. Deutscher, P. [1990], R. G. Hawtrey and the Development of Macroeconomics,
Macmillan.
Dokic, J. and Engel, P. [2002], Frank Ramsey, Routledge．
Hawtrey, R. [1912], “Aspects” (Hawtrey Papers, 12/1, Churchill College, Cambridge University).
Hawtrey, R.[1913], Good and Bad Trade, Constable & Company.
Hawtrey, R. [1925], “Public Expenditure and the Demand for Labour”, Economica, March.
Hawtrey, R. [1926], The Economic Problem, Longmans, Green and Co.
Hawtrey, R. [1928], Trade and Credit, Longmans, Green and Co.
Hawtrey, R. [1932], The Art of Central Banking, Longmans, Green and Co.
Hawtrey, R. [1944], Economic Destiny, Longmans, Green and Co.
Hawtrey, R., Right Policy: The Place of Value Judgements in Politics (Hawtrey Papers, 12/2, Churchill College, Cambridge University).
Hawtrey, R., Thought and Things (Hawtrey Papers, 12/1, Churchill College, Cambridge University).
Hutchison, T.[1938], Significance and Basic Postulates of Economic Theory, Macmillan.
Kurz, H. [2009], “If Some People Looked Like Elephants and Others Like Cats, or Fish …: The Case of Wittgenstein and Sraffa”.
Langer, S. [1942], Philosophy in a New Key: A Study in the Symbolism of Reason, Rite, and Art, Harvard University Press.
Langer, S. [1953], Feeling and Form: A Theory of Art, Scribner, 1953.
Long, D. and Wilson, P. eds. [1995], Thinkers of the Twenty Years’ Crisis, Clarendon Press, Oxford.
Moore, G. E. [1903], Principia Ethica, Cambridge University Press.
Pigou, A.C. [1950], The Economics of Welfare, 4th edition, Macmillan (The First edition, 1920).
Putnam, H. [1987], The Many Faces of Realism, La Salle: Open Court.
Ramsey, F. [1926], “Truth and Probability” (in Ramsey [1990]).
Ramsey, F. (ed. by Mellor, D.H.) [1990], Philosophical Papers, Cambridge University Press, 1990.
Robbins, L. [1932], An Essay on the Nature and Significance of Economic Science, Macmillan.
Russell, B. [1912], The Problems of Philosophy, Home University Library.
Russell, B. [1956], Portrait from Memory and Other Essays, George Allen and Unwin Ltd.
Russell, B., Woolf, L., White, M. and Wisdom, J. [1959], “The Influence and Thought of G. E. Moore: A Symposium”, Listener, 30 April.
Waddington, C.N. [1960], The Ethical Animal, Athenaeum.
Warnock, G.J. [1958], English Philosophy since 1900, Oxford University Press.
Wilson, D., [1978], Leonard Woolf : A Political Biography, St. Martin’s Press.
Wilson, P. [2003], The International Theory of Leonard Woolf, Palgrave.
Wittgenstein, L. [1958], Philosophical Investigations, Basil Blackwell (trans. by Anscombe, G.E. M.)
Woolf, L.[1916], International Governments, George Allen and Unwin.
Woolf, L.[1928], Imperialism and Civilization, Hogarth Press.
Woolf, V., Roger Fry: A Biography, Hogarth Press, 1940.
Wittgenstein (trans. by Noya, S. [2003]), Logico-Tractus, Iwanami Shoten..
Kant (trans. by Utsunomiya, Y. [1985]), For the Eternal Peace, Iwanami Shoten..
Descartes (trans. by Yamada, H. [2006]), Reflections, Chikuma Shobou.
Plato (trans. by Kubo, T. [1952]), Festival, Iwanami Shoten.
Plato (trans. by Fujisawa, R. [1979], Nation, Iwanami Shoten.
Russell (trans. by Nakamura [1959]), Autobiography, Misuzu Shobou.
Russell (trans. by Takamura, N. [2005], Introduction to Philosophy, Chikuma Shobou.
Ito, K. [1997], Philosophy of Human Rationality, Chikuma Shobou.
Iyasu, T. [2002], The Formation and Development of the Theory of Elite, Sekai Shisousha.
Kuroda, W. ed. [1978], Wittgenstein, Heibonsha.
Takiura, S. [1983], Wittgenstein, Iwanami Shoten.
Hirai, T. [2000], Keynes, Schumpeter and Hayek, Minerva.
Hirai, T. [2003], Keynes’s Theory, University of Tokyo Press.
Hirai, T. [2007a], Keynes and the World of Cambridge, Minerva.
Hirai, T. ed. [2007b], What is the Market Society?, Sophia University Press.
Hirai, T. ed. [2009], The Development of the Theory of the Market Society in Cambridge, Nihon Keizai Hyouronsha.
Fukuda, T. [1922], Social Policy and the Class Struggle, Kaizousha.
Matsushima, A. [2005], Will Utilitarianism Survive?, Keisou Shobou.
Yoshikawa, H. [1989], The Theory of Peace in the United Kingdom in the 1930s: Leonard Woof and the System of the League of Nations, University of Hokkaido Press.
