A Culture of Poverty

E.F. Schumacher

[Reprinted from the book of essays edited by Dom Moraes, Voices for Life:
Reflections on the Human Condition
, published in 1975]

E. F. Schumacher (1911-1977), economist and writer, was born in Germany. He studied abroad in the early 1930s, including a stay at Columbia University, but in 1937 he left Germany permanently for England, where he lived the rest of his life. During World War II, he was interned and required to work on farms in Britain for a short period, but he was soon released and worked with Lord Beveridge, who is credited with the theoretical framework for Britain's welfare state. After the war, Schumacher advised British authorities in postwar Germany. He was economic adviser to Britain's National Coal Board (1950-1970) and director of a company that pioneered common ownership and workers' control. His books - all on economic policy and planning - include Roots of Economic Growth (1962); Small Is Beautiful (1973), a best seller that was translated into fifteen languages; and A Guide for the Perplexed (1977).

Only the rich can have a good life - this is the daunting message that has been drummed into the ears of all mankind during the last half-century or so. It is the implicit doctrine of "development," and the growth of income serves as the very criterion of progress. Everyone, it is held, has not only the right but the duty to become rich, and this applies to societies even more stringently than to individuals. The most succinct and most relevant indicator of a country's status in the world is thought to be average income per head, while the prime object of admiration is not the level already attained but the current rate of growth.

It follows logically -- or so it seems - that the greatest obstacle to progress is a growth of population: It frustrates, diminishes, offsets what the growth of gross national product would otherwise achieve. What is the point of, let us say, doubling the GNP over a period, if population is also allowed to double during the same time? It would mean running faster merely to stand still; average income per head would remain stationary, and there would be no advance at all toward the cherished goal of universal affluence.

In the light of this received doctrine the well-nigh unanimous prediction of the demographers -- that world population, barring unforeseen catastrophes, will double during the next thirty years -- is taken as an intolerable threat. What other prospect is this than one of limitless frustration?

Some mathematical enthusiasts are still content to project the economic "growth curves" of the last thirty years for another thirty or even fifty years to "prove" that all mankind can become immensely rich within a generation or two. Our only danger, they suggest, is to succumb at this glorious hour in the history of progress to a "failure of nerve." They presuppose the existence of limitless resources in a finite world, an equally limitless capacity of living nature to cope with pollution, and the omnipotence of science and social engineering.

The sooner we stop living in the Cloud-Cuckoo-Land of such fanciful projections and presuppositions the better it will be, and this applies to the people of the rich countries just as much as to those of the poor. It would apply even if all population growth stopped entirely forthwith. The modern assumption that "only the rich can have a good life" springs from a crudely materialistic philosophy that contradicts the universal tradition of mankind. The material needs of man are limited and in fact quite modest, even though his material wants may know no bounds. Man does not live by bread alone, and no increase in his wants above his needs can give him the "good life." Christianity teaches that man must seek first "the kingdom of God, and his righteousness" and that all the other things - the material things to cover his needs - will then be "added unto" him. The experience of the modern world suggests that this teaching carries not only a promise but also a threat, namely, that "unless he seeks first the kingdom of God, those material things, which he unquestionably also needs, will cease to be available to him."

Our task, however, is to bring such insights, supported, as I said, by the universal tradition of mankind, down to the level of everyday economic reality. To do so, we must study, both theoretically and in practice, the possibilities of "a culture of poverty."

To make our meaning clear, let us state right away that there are degrees of poverty that may be totally inimical to any kind of culture in the ordinarily accepted sense. They are essentially different from poverty and deserve a separate name; the term that offers itself is "misery." We may say that poverty prevails when people have enough to keep body and soul together but little to spare, whereas in misery they cannot keep body and soul together, and even the soul suffers deprivation. Some thirteen years ago when I began seriously to grope for answers to these perplexing questions, I wrote this in Roots of Economic Growth:

All peoples - with exceptions that merely prove the rule-have always known how to help themselves, they have always discovered a pattern of living which fitted their peculiar natural surroundings. Societies and cultures have collapsed when they deserted their own pattern and fell into decadence, but even then, unless devastated by war, the people normally continued to provide for themselves, with something to spare for higher things. Why not now, in so many parts of the world? I am not speaking of ordinary poverty, but of actual and acute misery; not of the poor, who according to the universal tradition of mankind are in a special way blessed, but of the miserable and degraded ones who, by the same tradition, should not exist at all and should be helped by all. Poverty may have been the rule in the past, but misery was not. Poor peasants and artisans have existed from time immemorial: but miserable and destitute villages in their thousands and urban pavement dwellers in their hundreds of thousands - not in wartime or as an aftermath of war, but in the midst of peace and as a seemingly permanent feature - that is a monstrous and scandalous thing which is altogether abnormal in the history of mankind. We cannot be satisfied with the snap answer that this is due to population pressure. Since every mouth that comes into the world is also endowed with a pair of hands, population pressure could serve as an explanation only if it meant an absolute shortage of land - and although that situation may arise in the future, it decidedly has not arrived today (a few islands excepted). It cannot be argued that population increase as such must produce increasing poverty, because the additional pairs of hands could not be endowed with the capital they needed to help themselves. Millions of people have started without capital and have shown that a pair of hands can provide not only the income but also the durable goods, i.e., capital, or civilized existence. So the question stands and demands an answer. What has gone wrong? Why cannot these people help themselves?

The answer, I suggest, lies in the abandonment of their indigenous culture of poverty, which means not only that they lost true culture but also that their poverty, in all too many cases, has turned into misery.

A culture of poverty such as mankind has known in innumerable variants before the industrial age is based on one fundamental distinction - which may have been made consciously or instinctively, it does not matter - the distinction between the "ephemeral" and the "eternal." All religions, of course, deal with this distinction, suggesting that the ephemeral is relatively unreal and only the eternal is real. On the material plane we deal with goods and services, and the same distinction applies: All goods and services can be arranged, as it were, on a scale that extends from the ephemeral to the eternal. Needless to say, neither of these terms may be taken in an absolute sense (because there is nothing absolute on the material plane), although there may well be something absolute in the maker's intention: He may see his product as something to be used up, that is to say, to be destroyed in the act of consumption, or as something to be used or enjoyed as a permanent asset, ideally forever.

The extremes ate easily recognized. An article of consumption, like a loaf of bread, is intended to be used up while a work of art, like the Mona Lisa, is intended to be there forever. Transport services to take a tourist on holiday are intended to be used up and therefore ephemeral, while a bridge across the river is intended to be a permanent facility. Entertainment is intended to be ephemeral; education (in the fullest sense) is intended to be eternal.

Between the extremes of the ephemeral and the eternal, there extends a vast range of goods and services with regard to which the producer may exercise a certain degree of choice: He may be producing with the intention of supplying something relatively ephemeral or something relatively eternal. A publisher, for instance, may produce a book with the intention that it should be purchased, read, and treasured by countless generations or his intention may be that it should be purchased, read, and thrown away as quickly as possible.

Ephemeral goods are -- to use the language of business -- "depreciating assets" and have to be "written off." Eternal goods, on the other hand, are never "depreciated" but "maintained." (You don't "depreciate" the Taj Mahal; you try to maintain its splendor for all time.)

Ephemeral goods are subject to the economic calculus. Their only value lies in being used up, and it is necessary to ensure that their cost of production does not exceed the benefit derived from destroying them. But eternal goods are not intended for destruction; there is no occasion for an economic calculus, because the benefit - the product of annual value and time -- is infinite and therefore incalculable.

Once we recognize the validity of the distinction between the ephemeral and the eternal, we are able to distinguish, in principle, between two different types of "standards of living." Two societies may have the same volume of production and the same income per head of populatio, but the quality of life or life-style may show fundamental and incomparable differences: the one placing its main emphasis on ephemeral satisfactions and the other devoting itself primarily to the creation of eternal values. In the former there may be opulent living in terms of ephemeral goods and starvation in terms of eternal goods -- eating, drinking, and wallowing in entertainment, in sordid, ugly, mean, and unhealthy surroundings -- while in the latter there may be frugal living in terms of ephemeral goods and opulence in terms of eternal goods -- modest, simple, and healthy consumption in a noble setting. In terms of conventional economic accounting they are both equally developed -- which merely goes to show that the purely quantitative approach misses the point.

The study of these two models can surely teach us a great deal. It is clear, however, that the question "Which of the two is better?" reaches far beyond the economic calculus, since quality cannot be calculated.

No one, I suppose, would wish to deny that the life-style of modern industrial society is one that places primary emphasis on ephemeral satisfactions and is characterized by a gross neglect of eternal goods. Under certain immanent compulsions, moreover, modern industrial society is engaged in a process of what might be called ever-increasing ephemeralization; that is to say, goods and services that by their very nature belong to the eternal side are being produced as if their purpose were ephemeral. The economic calculus is applied everywhere, even at the cost of skimping and paring on goods that should last forever. At the same time purely ephemeral goods are produced to standards of refinement, elaboration, and luxury, as if they were meant to serve eternal purposes and to last for all time.

Nor, I suppose, would anyone wish to deny that many preindustrial societies have been able to create superlative cultures by placing their emphasis in the exactly opposite way. The greatest part of the modern world's cultural heritage stems from these societies.

The affluent societies of today make such exorbitant demands on the world's resources, create ecological dangers of such intensity, and produce such a high level of neurosis among their populations that they cannot possibly serve as a model to be imitated by those two-thirds or three-quarters of mankind who are conventionally considered underdeveloped or developing. The failure of modern affluence -- which seems obvious enough, although it is by no means freely admitted by people of a purely materialistic outlook - cannot be attributed to affluence as such but is directly due to mistaken priorities (the cause of which cannot be discussed here): a gross overemphasis on the ephemeral and a brutal undervaluation of the eternal. Not surprisingly, no amount of indulgence on the ephemeral side can compensate for starvation on the eternal side.

In the light of these considerations, it is not difficult to understand the meaning and feasibility of a culture of poverty. It would be based on the insight that the real needs of man are limited and must be met, but that his wants tend to be unlimited, cannot be met, and must be resisted with the utmost determination,. Only by a reduction of wants to heeds can resources for genuine progress be freed. The required resources cannot be found from foreign aid; they cannot be mobilized via the technology of the affluent society that is immensely capital-intensive and labor-saving and is dependent on an elaborate infrastructure that is itself enormously expensive. Uncritical technology transfer from the rich societies to the poor cannot but transfer into poor societies a life-style that, placing primary emphasis on ephemeral satisfactions, may suit the taste of small, rich minorities but condemns the great, poor majority to increasing misery.

The resources for genuine progress can be found only by a life-style that emphasizes frugal living in terms of ephemeral goods. Only such a lifestyle can create (or maintain and develop) an ever-increasing supply of eternal goods.

Frugal living in terms of ephemeral goods means a dogged adherence to simplicity, a conscious avoidance of any unnecessary elaborations, and a magnanimous rejection of luxury - puritanism, if you like -- on the ephemeral side. This makes it possible to enjoy a high standard of living on the eternal side, as a compensation and reward. Luxury and refinement have their proper place and function but only with eternal, not with ephemeral, goods. This is the essence of a culture of poverty.

One further point has to be added: The ultimate resource of any society is its labor power, which is infinitely creative. When the primary emphasis is on ephemeral goods, there is an automatic preference for mass production, and there can be no doubt that mass production is more congenial to machines than it is to men. The result is the progressive elimination of the human factor from the productive process. For a poor society, this means that its ultimate resource cannot be properly used; its creativity remains largely untapped. This is why Gandhi, with unerring instinct, insisted that "it is not mass production but only production by the masses that can do the trick." A society that places its primary emphasis on eternal goods will automatically prefer production by the masses to mass production, because such goods, intended to last, must fit the precise conditions of their place; they cannot be standardized. This brings the whole human being back into the productive process, and it then emerges that even ephemeral goods (without which human existence is obviously impossible) are far more efficient and economical when a proper fit has been ensured by the human factor.

All the above does not claim to be more than an assembly of a few preliminary indications. I entertain the hope that, in view of increasing threats to the very survival of culture - and even life itself - there will be an upsurge of serious study of the possibilities of a culture of poverty. We might find that we have nothing to lose and a world to gain.