Taking a quick look at EF Schumacher's book, "Small is Beautiful"

 Economic Planning must focus first on human happiness

Does excessive consumption & production undermine mankind?

Late Oxford economist, statistician,  and thinker E.F. Schumacher proposes that excessive production and consumption in society undermines well-being (mankind's ultimate purpose).

He offers a crucial message for a world struggling to balance economic growth against the human costs of globalisation. Schumacher feels we should be building our economies around the needs of communities and not corporates.  So the book urges the idea that economics should serve the people.


 Schumacher takes us from a discussion of our unsustainable economy all the way through to alternatives to capitalism. In his view, we are, quite literally, destroying our own foundations.


“The Problem of Production,” Schumacher challenges our understanding of nature and our place within it. We see ourselves as seemingly above nature, and our goal is to produce by conquering natural resources and controlling people. The irony is that, if we do conquer nature, it will be the end of us all. 

Schumacher also asks us to consider why we’re moving in this direction as we continue to exploit nature's resources until it has nothing left to give us. 

Natural Resources must be seen as a capital expense: Business usually sees natural resources as an operating expense when it is actually a capital cost to the economy. We are using natural resources as if they were unlimited and eternally replenishable, when that is clearly not the case.

Reckless spending; The economist itemizes three kinds of natural resource capital that are being recklessly treated as income as we produce:

  • Fossil fuels

  • Nature's tolerance margins and

  • Human resources (human substance)


A shift to responsible lifestyle urgently needed: Schumacher, makes an urgent appeal to recognize the urgency of the situation and evolve a new lifestyle with more responsible methods of production and more wholesome patterns of consumption.

Where new consumption patterns are vital: 

  • Agriculture: We need production methods that are "biologically sound." That build up soil fertility and produce health.

  • Industry: We need to develop small-scale, "non-violent technology with a human face, so that people can also enjoy working." Exploring "new forms of partnership between management and men."

  • Energy saving: Schumacher estimates that rich countries consume 14 times more energy than poor nations (per capita). Thus setting up potential conflicts when the price of energy goes up and conventional sources become scarce.

Peace and Permanence: Prosperity for all is considered the foundation of Peace. Gandhi once said, "the earth has enough for every man's need but not for every man's greed."

To achieve a universal peace we will need to find a way to engineer universal prosperity without promoting greed.

Universal peace cannot be found through selfishness: We will NOT be able to achieve universal understanding through the materialist or consumerist gospel which says "enrich yourselves" and implies that it's ok to love things and use people (instead of the reverse).

Working in tandem with nature: Says Schumacher: We can’t achieve prosperity in the modern sense without greed and ill actions. We base our entire theory of economics on contradictions like this. What we need instead, are smaller-scale methods which can be accessed by everyone, allowing us to be ourselves and to work in tandem with nature.

Recognizing our true spirit nature: Schumacher asks, "How could we even begin to disarm greed and envy?" His prescription? " Recognizing our eternal spirit nature. Thus being much less greedy and envious ourselves." 

He goes on to say, "I think Gandhi has an answer: There must be recognition of the existence of the (permanent) soul apart from the body.

Greed grows GNP, not joy. "If human vices: such as greed and envy are promoted in the media…..the inevitable result is the collapse of intelligence: "The inability to see things in their wholeness." "GNP may rise rapidly" while actual people feel increasing alienation, frustration, insecurity etc. "Only by a reduction of needs can one promote a genuine reduction in those tensions which are the ultimate causes of strife & war.

Finding meaning in our work: Schumacher quotes Aldous Huxley who said, "provide ordinary people with the means of doing profitable and intrinsically significant work, of helping men and women to achieve independence from bosses, so that they may become their own employers, or members of a self-governing cooperative group."


The machines used in such enterprises should be inexpensive, and the enterprise should be viable on a small scale. The work schedule should leave room for family and creativity.

Right Livelihood: work & play in balance: Schumacher's time in Burma gave him insight into the idea that spiritual values and economic progress must go hand in hand. He says, we"have been brought up to consider 'labour or work' as little more than a necessary evil." 

Employers also see labour as a cost to be reduced or eliminated by automation. The division of labour was devised to reduce work into efficient insignificant and repetitive movements.

A more rounded view of work; The Buddhist view of work is more Holistic: To help people:

  • Develop their faculties.

  • Overcome ego by joining with others in a common task and

  • To develop goods & services for a stable life.

Production but not at the expense of people's lives: We currently "indicate a greater concern for goods than for people, an evil lack of compassion." "Equally to strive for leisure as an alternative to work would be considered a complete misunderstanding of one of the basic truths of human existence, namely that work and leisure are complementary parts of the same living process and cannot be separated without destroying the joy of work and the bliss of leisure."

Introducing right technology: Right mechanization, enhances a man's skill: 'There are two kinds of mechanization: one that enhances a man's skill and power and one that turns the work of man over to a mechanical slave, leaving man to serve the slave." 

A holistic and balanced view of work will show that "to let mothers of young children work in a factory while the children run wild would be uneconomic" from a Buddhist perspective.

High standards of living from low consumption: Modern economists measure standard of living by the amount of annual consumption. The Buddhist planner would instead seek the maximum of well being for the minimum of consumption. Thus the strain and stress of living is reduced for the minimalist.

"Simplicity and non violence are closely related." People satisfying their needs with a modest use of resources are less likely to be at each other's throats. Also "people who live in self sufficient local communities are less likely to be involved in large scale violence than people whose existence depends on world wide systems of trade."

Right living involves optimal use of natural resources: Human life depends on an ecosystem that involves many forms of life. When people are cut off from nature in towns there is a tendency to misuse resources like water and trees.

Sustainability to the fore: Modern economics does not distinguish between renewable and non renewable materials. Everything is just quantified by price. Exploitation of non renewable fuels in growing volumes is an ever increasing act of violence against nature which inevitably leads to violence between men. 

Is modernization without spirit viable? Consequences for the masses are disastrous!

  • Collapse of rural economies.

  • A rising tide of unemployment in town and country.

  • The growth of an urban working class without proper nourishment for body or soul.

We must find the right way for development (right livelihood).

Taking a closer look at size:

  • Large units tend to break up into smaller units: process of balkanization.

  • Is bigger better? Small nations do well also.

  • Are corporate economies of scale needed? There is now a new found emphasis on autonomization of units.

  • Large cities tend to have large unstable migrant populations.

Policies towards urbanization accentuates outdated ideas

  • Create concentration of wealth & speed disparity.

  • Large capital intensive projects preferred to labour intensive ones.

  • Weakening of labour bargaining power.

(Population concentrations also imply less healthy people vulnerable to pandemics).

A new system of thinking that focuses on people not products is long overdue.

  • We must use our scientific and technological potential to fight human misery.

  • We need a political and management structure that can contact and support individuals, families & groups. Not states and other anonymous abstractions

Democracy is meaningless without

  • Standard of living

  • Human dignity

  • Fulfilment and if possible

  • Self realization.

People can be themselves only in small comprehensible groups. We must learn to think of structures that can manage large numbers of small units.

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