The Moral Economists

1. The Moral Critique of Capitalism: Beyond Material Inequality

For most of the nineteenth and twentieth centuries, poverty mattered less to capitalism’s critics than moral or spiritual desolation.

A truncated critique. In the twenty-first century, the critique of capitalism has narrowed dramatically, focusing almost exclusively on material inequality. This emphasis, while seemingly unremarkable today, represents a radical truncation of a richer, historical tradition that prioritized moral and spiritual consequences over purely economic outcomes. This shift from vivid moral argument to calculations of advantage and disadvantage, fortified with anger, diminishes contemporary debate.

Deeper questions. The earlier critical tradition, exemplified by figures like R. H. Tawney, Karl Polanyi, and E. P. Thompson, understood poverty and squalor as symptoms of deeper failures of social coordination. They sought to address fundamental questions of liberty and solidarity, aiming for a society that was "closer than individualism admitted but freer than collectivism allowed." This approach systematically excluded the narrower economism now prevailing, which often falls back on utilitarian arguments even when critiquing inequality.

Lost perspective. While the modern focus on empirical discussion and practicable reforms might seem an improvement, it signifies the decadence of an alternative approach that engaged with social problems on a more profound moral plane. Reconstructing this lost moral critique reveals that intellectual, cultural, and even political discourse is poorer for its disappearance, suggesting that a preoccupation with material inequality alone leaves contemporary debate diminished.

2. Tawney's Foundation: Christian Humanism and Social Solidarity

The essence of all morality is this: to believe that every human being is of infinite importance, and therefore that no consideration of expediency can justify the oppression of one by another.

Moral relationships. R. H. Tawney pioneered a moral critique of capitalism in the 1920s, arguing that modern society was "sick through the absence of a moral ideal." His experiences teaching working people in northern England revealed forms of solidarity that transcended both atomistic individualism and authoritarian collectivism, inspiring him to seek a systemic solution to the "social problem" beyond mere relief schemes. He believed that the "heart of the problem" was not economic, but a "question of moral relationships."

Infinite value of personality. Tawney's critique was anchored in a specific conception of "human personality," which he considered invaluable and irreducible to utilitarian calculations. This conviction stemmed directly from his Christian faith, particularly the Anglo-Catholic emphasis on the doctrine of the Incarnation, which posited that "the personality of man is the most divine thing we know." This theological grounding provided a "higher law" that condemned exploitative practices, regardless of their aggregate utility.

History as a mirror. In Religion and the Rise of Capitalism, Tawney used history to dramatize the "spiritual blindness" that allowed economic motives to become detached from moral strictures, tracing this "dualism" back to the sixteenth and seventeenth centuries. He depicted medieval society as an "articulated organism" where religion sanctioned social duties, contrasting it with a modern world where economic life was severed from spiritual purpose. This historical narrative served not as nostalgia, but as a means to articulate and nurture the emergent solidarities he observed in his own time.

3. Polanyi's Secular Shift: Marxian Humanism and the Double Movement

Aristotle was right: man is not an economic, but a social being.

Beyond Christian dogma. Karl Polanyi, an intermediary between Tawney and Thompson, shared Tawney's critique of capitalism's moral vacuity but sought a secular foundation for the "infinite value of human personality." Initially, he found this in the newly published early writings of Karl Marx, which offered a "conception of the nature and possibilities of man" that transcended purely materialist interpretations. Polanyi argued that Christian teachings needed "further elucidation" to remain relevant in complex commercial societies, where the "love thy neighbor" principle became impracticable.

The double movement. Polanyi's masterpiece, The Great Transformation, presented a historical narrative where the rise of capitalism, particularly the commodification of land and labor, was met by a "double movement" of societal self-protection. He controversially argued that older moral scruples, like those embodied in the Speenhamland system, persisted into the early nineteenth century, delaying the full imposition of market logic until a "countermovement" of social legislation and working-class organization could emerge. This historical thesis aimed to demonstrate that human nature inherently "rebels against Capitalism," validating the immanent "idea of the perfect thing"—a society beyond self-estrangement.

History's validation. Unlike Tawney, who relied on theology to justify his moral precepts, Polanyi needed history to validate his secular, Marxian-derived conception of human personality. He sought to show that "reality itself must press towards the fulfilment of the Idea" of a humane society. While his historical interpretations, particularly regarding Speenhamland, faced skepticism from contemporaries like G.D.H. Cole and R. H. Tawney, his work laid crucial groundwork for later critiques by demonstrating that the "humanistic foundations" of political economy had been eroded, not absent from the start.

4. The Flawed Promise of "Transcending Capitalism"

The monster has proved more malleable than—a century ago, when Socialist searchlights were first turned upon him—it seemed conceivable that he should.

Capitalism's malleability. By the late 1940s, the perceived terminal crisis of capitalism had been averted, leading many to believe that the system was being "transcended." R. H. Tawney himself acknowledged that capitalism had "acquired a slightly less unsocial nature" due to reforms in corporate finance, the growth of trade unions, and the emergence of the welfare state. This period of rising prosperity and stabilizing reform fostered optimism that modernity's antinomies—between progress and reaction, economics and ethics—were being overcome.

New paradigms. Intellectuals like Evan Durbin and Karl Mannheim sought to adapt the moral critique for this "post-capitalist" age. Durbin, a protégé of Tawney, integrated insights from the human sciences (psychology) to argue that cultivating emergent solidarities was key, while Mannheim, a sociologist, proposed "planning for freedom" to temper economic rationality with social norms. Both believed that capitalism's transformation made solutions to the "question of moral relationships" easier to envisage, moving beyond the stark choices of individualism or collectivism.

Sterile innovations. However, these attempts to "transcend capitalism" often proved to be sterile innovations within the moral critique. Durbin and his successors, while acknowledging Tawney's concerns, remained tethered to utilitarian reasoning, which Tawney had fundamentally rejected. Mannheim's vision of an intellectual elite synthesizing a "new morality" was seen by critics like T. S. Eliot as a dangerous, hubristic attempt to codify tacit cultural norms, risking the very social spirit it sought to foster. These approaches, while influential, ultimately diverged from the core principles of the moral critique.

5. Thompson's Moral Economy: Reclaiming Human Agency in History

But men make their own history: they are part agents, part victims: it is precisely the element of agency which distinguishes them from the beasts, which is the human part of man, and which it is the business of our consciousness to increase.

Beyond economic automatism. E. P. Thompson, picking up where Polanyi left off, perfected the moral critique by focusing on "conscious human agency" and "moral choices" against the economic determinism of Stalinist Marxism. Disillusioned by the Soviet repression in Hungary in 1956 and the Suez crisis, Thompson rejected the Stalinist notion that economic interests were the sole drivers of human motivation, arguing that it reduced individuals to "economic automata." He sought to infuse Marxism with older traditions of popular struggle and a "humanist" understanding of human nature, initially inspired by William Morris.

The moral economy. Thompson's The Making of the English Working Class (1963) dramatically challenged conventional historical narratives by demonstrating the enduring power of "customary notions of craftsmanship," "vestigial notions of a 'fair' price and a 'just' wage," and other non-economic norms well into the Industrial Revolution. He coined the term "moral economy" to describe these deeply assumed, often unarticulated solidarities that shaped working people's resistance to capitalist rationalization. This concept allowed him to articulate the "nameless solidarities" he encountered in places like Yorkshire, making them legible in historical terms.

History from below. Thompson's success lay in his innovative methodology, particularly his "history from below," which unearthed evidence of these moral economies from the perspective of ordinary villagers, artisans, and weavers. By focusing on the "depersonalized nature of relations between worker and employer" and the "rupture of the traditional integument of village custom," he showed how capitalism's rise was not a sudden, complete rupture but a contested process where older moral sentiments persisted and regenerated in new forms of solidarity. This approach provided a powerful, historically grounded means to challenge the utilitarian reduction of human beings.

6. The Erosion of "Human Personality" as a Moral Anchor

If I thought that Althusserianism was the logical terminus of Marx’s thought, then I could never be a Marxist. I would rather be a Christian (or hope to have the courage of a certain kind of Christian radical). At least I would then be given back a vocabulary within which value choices are allowed, and which permits the defence of the human personality against the invasions of the Unholy Capitalist or Holy Proletarian State.

A crumbling foundation. By the 1970s, the moral critique of capitalism faced a profound challenge: the erosion of its foundational concept of "human personality." Tawney's theological grounding for the "infinite value of human personality" had been undermined by secularization. Thompson's Marxian "notion of the 'fully human'," while initially powerful, proved "inadequate, insufficiently-defined" when confronted with the harsh realities of fascism, consumer capitalism, and Stalinism.

Anti-humanist tide. New intellectual currents, particularly from postcolonial thought (Fanon) and French philosophy (Foucault, Althusser), fostered deep skepticism towards European humanist discourses. These critiques viewed the concept of "Man" as a recent, often hypocritical, invention, liable to pass out of focus. Postwar liberal thinkers, like Isaiah Berlin and Judith Shklar, also advocated for a "nonscheme" or "de-structured vacancy" where notions of the fully human once resided, fearing that prescriptive claims about human nature could lead to totalitarianism.

A vocabulary lost. This confluence of forces left Thompson struggling to find a "vocabulary within which value choices are allowed, and which permits the defence of the human personality." Without a credible, widely accepted basis for asserting the inherent value of human beings, the moral force of the critique diminished. Thompson's later efforts to salvage a Marxian humanism, such as in "The Poverty of Theory," often seemed futile, highlighting the intractable problem of sustaining a moral critique in an increasingly anti-humanist intellectual climate.

7. Polanyi's Unexplored Path: Reconstituting Political Economy from Within

The biological nature of man appeared as the given foundation of a society that was not of a political order. Thus it came to pass that economists presently relinquished Adam Smith’s humanistic foundations and incorporated those of Townsend.

Beyond the human definition. When Karl Polanyi began to doubt that Marx could provide a robust, secular conception of human personality to counter utilitarianism, he shifted his strategy. Instead of seeking another prescriptive definition of the human, Polanyi questioned the very premise that such a definition was necessary to challenge utilitarian orthodoxy. He proposed that the problem lay not in the absence of a strong humanistic counter-definition, but in the historical moment when political economy itself abandoned its "humanistic foundations."

The Townsend watershed. Polanyi's re-reading of the intellectual history of political economy identified a crucial "watershed" around 1780, after Adam Smith but before Malthus and Ricardo. He pinpointed Joseph Townsend's Dissertation on the Poor Laws (1786), with its fable of goats and dogs on Juan Fernandez island, as the moment when economists began to model human society on the "regularities of the natural world." This naturalistic turn, Polanyi argued, wrongly reduced human beings to profit-making animals, making the subsequent insistence on human personality a reactive necessity.

Re-inscribing distinction. Polanyi suggested that by returning to Adam Smith, whose work predated this naturalistic declension, political economy could be reconstituted from within. Smith, in Polanyi's view, had approached economic questions within "the moral world of which the body politic had hitherto been part," implicitly recognizing a fundamental distinction between human affairs and animal life. This approach offered a way to confound the utilitarian calculus by simply re-establishing that humans are not animals, thereby avoiding divisive prescriptive claims about what it means to be human, and potentially regenerating the moral critique.

8. The Limits of Welfare Economics in Addressing Moral Concerns

To those of us who were brought up in the liberal and democratic traditions of British political life, a certain form of utilitarianism is bred in our bones, and will not pass from us until we are dead.

Utilitarian incompatibility. Early attempts to integrate Tawney's moral critique into mainstream economic theory, particularly through interwar welfare economics, proved largely unsuccessful. Evan Durbin, a protégé of Tawney, sought to translate the "question of moral relationships" into the "technical vocabulary" of economics, believing that welfare economics could advance egalitarian goals. However, Tawney's fundamental antipathy towards utilitarianism, which reduced individuals to units in an aggregate utility calculus, made genuine reconciliation impossible.

Flawed assumptions. Welfare economics, as developed by A. C. Pigou, aimed to identify market failures and justify state intervention to increase overall utility. While seemingly progressive, this approach still relied on utilitarian assumptions that struggled with interpersonal comparisons of utility and could not adequately capture the "infinite value" of individual human personality. Critics, including later economists like Amartya Sen, would expose the facile assumptions underlying these calculations, demonstrating that utilitarianism was a poor means of advancing true egalitarian values.

Keynesian detachment. Even the Keynesian revolution, which legitimized government intervention to manage demand and achieve full employment, did not fully address the moral economists' concerns. While social spending could alleviate economic inequalities, John Maynard Keynes himself viewed the "economic problem" as primary, to be solved before addressing deeper "moral relationships." This implied a protracted suspension of ethics, a position fundamentally at odds with the moral economists' insistence on the immediate reconciliation of economics and ethics.

9. Social Choice Theory: A Modern Bridge for Moral Economics

Part of each individual’s value system must be a scheme of socio- ethical norms, the realization of which cannot, by their nature, be achieved through atomistic market behaviour.

Beyond individualism. The failures of interwar welfare economics paved the way for new approaches, notably Kenneth Arrow's "impossibility theorem" and the subsequent development of social choice theory. Arrow's work, while highly technical, addressed the same intermediate domain between individualism and collectivism that preoccupied Tawney and his successors. He demonstrated that aggregating individual preferences into a rational collective decision was impossible if certain "reasonable looking" individualistic assumptions were maintained, effectively exposing the limitations of residual utilitarian thinking in economics.

Socio-ethical norms. Arrow's key insight was that economists needed to factor in "a scheme of socio-ethical norms" into their models to properly describe how societies actually make collective choices. He even cited Tawney's Religion and the Rise of Capitalism when considering how "custom" or "convention" might pre-ordain individual preferences, thereby resolving the "impossibility" of social choice. This marked a significant shift: instead of critiquing economics from without, social choice theory began to explore how non-economic considerations could be integrated within economic models.

Sen's humanistic turn. Amartya Sen, a leading figure in social choice theory, further advanced this integration by explicitly challenging the "insular economic man" and incorporating "due concern for other members of society" into economic models. Sen argued that human preferences are not purely self-interested but are textured by social relations and value systems. By legitimizing interpersonal comparisons of utility and emphasizing the "capacity to feel pain" and "affection for others," Sen provided a more nuanced conception of the human, capable of challenging utilitarian reduction without resorting to strong, prescriptive claims about human nature.

10. Reclaiming the Human: A Modest Proposal for Contemporary Critique

That all men are human, is, if a tautology, a useful one, serving as a reminder that those who belong anatomically to the species homo sapiens, and can speak a language, use tools, live in societies, can interbreed despite racial differences, etc., are also alike in certain other respects more likely to be forgotten.

A renewed purpose. The moral economists' critique of capitalism, though hampered by the erosion of its foundational concept of "human personality" in the late twentieth century, finds a potential path to regeneration through the insights of social choice theory. Polanyi's suggestion to challenge utilitarianism by re-inscribing the distinction between human affairs and the natural world, rather than by making strong prescriptive claims about human nature, aligns with Sen's more modest yet powerful assertion of shared human characteristics. This approach avoids the pitfalls of anti-humanist skepticism while still confounding the reductive "economic man."

Beyond strong claims. Sen's argument that humans possess common capacities—to feel pain, affection, and the consequences of their frustration—is a more modest claim than Tawney's theological or Thompson's Marxian humanism. Yet, it is equally capable of challenging the reduction of individuals to cold, solipsistic calculators. This approach insists that more than rational self-interest animates social life, without requiring divisive metaphysical definitions of what it means to be human, making it more palatable in contemporary intellectual discourse.

History's continuing role. While social choice theory offers a framework for reconstituting political economy from within, history remains crucial. It reveals that "durable solidarity is not achieved by approximate realization of some universal model," but is an "improvised, practical accomplishment of particular peoples in specific times and places." The moral economists' histories demonstrated that seemingly natural economic arrangements are mutable and contested, opening up possibilities for renegotiating the "systems of collective choice" under which we live. This ongoing dialogue between historical understanding and economic theory can help us articulate and build upon the "nameless solidarities" that continue to emerge and dissolve in commercial societies.