WHY SMALL IS STILL BEAUTIFUL?SUSTAINABLE CITIES VERSUS ‘CREATIVE’ CITIES

R A Z A N A E E M

ABOUT SMALL IS BEAUTIFUL

The book Small is Beautiful was published in 1973.

Schumacher among a few heterodox economists making a comeback in the wake of the 2008-2010 world financial crisis

A study of Economics as if PEOPLE mattered.

PRODUCTION

One of the most fateful errors of our age is the belief that ‘the problem of production’ has been solved.

For the rich countries, they say, the most important task now is ‘education for leisure’ and, for the poor countries, the ‘transfer of technology’.

This illusion is based on the failure to distinguish between income & capital. Far larger is the capital provided by nature and not by man, which is now being

used up at an alarming rate.To get off the present collision course, we must thoroughly understand the

problem & begin to see the possibility of evolving a new life-style, with new methods of production and new patterns of consumption: a life-style designed for permanence.

THE ROLE OF ECONOMICS

What sort of meaning the method of economics actually produces?Methodology of economics ignores man’s dependence on the natural world

i.e. deals with goods & services from the market’s point of view, not with their origin or conditions of their production.

Economics is a ‘derived’ body of thought – from metaeconomics.Metaeconomics consists of 2 parts: one dealing with man and the other

dealing with environment.

BUDDHIST ECONOMICS

According to Buddhism, function of work is 3-fold: to give a man a chance to utilize & develop his faculties; to enable him to overcome his egocentredness by joining with other people in a common task; and to bring forth goods and services for a becoming existence.

The keynote of Buddhist Economics is simplicity and non-violence.Buddhist economics is the systematic study of how to attain given ends with

the minimum means.It tries to maximize human satisfaction by the optimal pattern of consumption.Production from LOCAL resources for LOCAL needs is the most rational way

of life.

A QUESTION OF SIZE

Emphasis of the duality of human requirement when it comes to the question of size

What scale is appropriate? E.g. appropriate size of a city‘Footloose’ people & the problem of megalopolisDestructive effects of technological developments in rich &

poor countriesThe economics of small independent countries and

regionalism‘Production by the masses, rather than mass production’

DEVELOPMENT

2 phenomena are giving rise to world-wide concern: mass unemployment & mass migration into cities.

Development & evolutionDevelopment does not start with goods; it starts with people &

their education, organization & disciplineIt requires a process of evolution & must involve the entire

population.

FOR ECONOMIC GROWTH

Emphasis on ‘New growth theory’Describes Pakistan’s old economic model e.g. Harrod-Domar as still

relevantTalks about privatization, liberalization and scaling back the role of the

state in development; enforcing contracts & property rightsThe section on ‘Land Reforms’ does not really address the plight of the

landless peasants in Pakistan, except protecting the landlordSeems to be written in isolation to global dissatisfaction and revolt

beginning with Arab worldOld wine in new bottle: no real alternative to Pakistan’s multiple problems

INTERMEDIATE TECHNOLOGY

The gap between the technologies of developing (GBP1) & developed countries (GBP1000) is enormous.

Intermediate technology (GBP100) ranges in some intermediate position between the two technologies.

It would be more productive than indigenous technology, but also cheaper than technology of modern industry;

Example of intermediate technology: international firms designing small petroleum refineries with low capital investment per unit of output & a low total capacity.

Real achievement of intermediate technology lies in the accumulation of precise knowledge.

THE SCHUMACHER SOLUTION: SOCIALISM

Socialism is of interest solely for its non-economic values & the possibility it creates for the overcoming of the religion of economics.

Nationalization?A total rejection of public ownership means a total affirmation of private

ownership.Public ownership gives complete freedom in the choice of objectives & can

therefore be used for any purpose that maybe chosen.Socialists should insist on using the nationalized industries to evolve a more

democratic & dignified system of industrial administration, a more humane employment of machinery & a more intelligent utilization of the fruits of human ingenuity & effort.

OWNERSHIP & NATIONALIZATION

Five principles for nationalized enterprises providing public services.It is dangerous to mix business & politics.Nationalized enterprises providing public services should always aim at a profit

and should build up reserves.Nationalized enterprises, nonetheless, should have a statutory obligation to ‘serve

the public interest in all respects’.To enable the ‘public interest’ to be recognized & safeguarded in nationalized

industries, there is need for arrangements by which all legitimate interests can find expression & exercise influence.

The chief danger to nationalization is the planner’s addiction to over-centralization.