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A figure of the German Conservative Revolution, Werner Sombart devoted a large part of his work to the analysis of the capitalist spirit and the research of its origins. By focusing on the genesis of capitalism which he situated in the Late Middle Ages, the German sociologist highlights the opposition between a pre- capitalist European commercial ethic, called subsistence, and a specifically capitalist ethic. This latter was firstly influenced by Christian thought, which limited it, before it freed itself from it.

The feudal and corporatist economy of the Middles Ages was dominated by the idea that everyone should be capable of living from his work in conformity with his rank and by leading an honest life. The statement of Sigismond, the Germanic Holy Roman Emperor at the start of the 15th century, recounted by Werner Sombart, transcribes this ideal: “Work exists so that each man can earn his bread by performing it and so that no one can impinge upon the trade of another. Thanks to it each man can satisfy his needs and feed himself.” The economic logic governing such a society was thus subordinated to the necessity of providing for the producers and the determination of prices was essentially based on the costs of production. Usage value took priority over exchange value: prices didn’t depend on supply and demand in the pre- capitalist commercial spirit. Likewise, any maneuver aiming to depress prices, like a fire sale, was judged immoral.

This ethic, which Werner Sombart qualified as the ethic of subsistence, created a particular conception of the notion of competition. In order to assure price stability and the means of survival for everyone, tradesmen and artisans were restrained to the domain of a particular activity and a defined clientele. Impregnated with the peasant spirit, this commercial morality considered that “the client was for the city dweller, what the plot of land was for the peasant,” according to Sombart. Any pursuit of clients was thus prohibited and the actions aiming to attract clients from one’s neighbor were forbidden. Relying on the commercial regulations and the legal records of large commercial cities, Werner Sombart showed that any attempt at commercial promotion could lead to sanctions.

Moreover, by assuring the organization and regulation of professions, the guilds watched out to make sure no one impinged on another person’s realm of activity. Regarding the prohibition of lending at interest that predominated at the time, it conformed to the ethic of guarding against any panic by forbidding the production of money from money. The sociologist remarked that this pre- capitalist economy was not very productive. The lack of commercial rigor, the multitude of holidays, and the slowness of transaction speed reduced the efficiency of a society in which economic work was not the central point, a society in which the elites were not legitimized by their commercial prowess. In effect, this spirit corresponded to European societies in which life was regulated by social, popular, and religious events, which imposed their imperatives upon commerce. Moreover, Werner Sombart was well aware that the principles of this ethic of subsistence were regularly violated. Yet the regular transgression of the forbidden, even the occasional tolerance of this transgression, did not weaken the principle nor its mark left on the spirit of the age.

The emergence of the first forms of capitalism in Italy in the 13th and 14th centuries, notably in Florence, broke with the preceding eras not only by valuing wealth obtained from work, but especially by rationalizing economizing attitudes. Werner Sombart underlined the role of certain aspects of Catholicism in this evolution. By advocating the idea of a chaste and moderate life but also the absolute mastery of oneself and rigor in work, the Thomist doctrine of Catholicism encouraged the rationalization of life and created a fertile ground for the development of homo economicus. Honesty and rigor in business were no longer solely constraints imposed by reputation but virtues required by the personal conscience of the individual, which increased the degree of necessity. These Christian virtues were a catalyst for the capitalist spirit but they were equally an important limit. Thomism did not condemn wealth but it distinguished it from enrichment. Movement, dynamism always excites mistrust and the fear of a violation of limits. Furthermore, even when it is allowed, this enrichment must not be the end goal. Man must remain the ultimate ends of the economy.

The Persistence of the Ethic of Subsistence

However the principles of the ethic of subsistence remained omnipresent in this first form of capitalism. More rational and effective than before, commercial activity remained low intensity. The ideas of limits combined with the ethic of subsistence had lost none of their importance and commerce remained subordinated to the social life of individuals. Devoting one’s life to the expansion of one’s wealth was not the capitalist ideal of this era, it was to earn enrich oneself rapidly and retire from business in order to enjoy and live on the earned wealth. Werner Sombart explained that during this period of primitive capitalism, prices remained essentially determined by the usage value of goods and competition was strictly subordinated to the principles of the pre- capitalist economy: “Even during the first half of the 18th century, the merchants of London saw the efforts of some of their colleagues to decorate their shops or attract clients with tasteful and elegant displays as unfair competition.” The sociologist illustrated this late remnant of the ethic of subsistence by citing the writings of Daniel Defoe, author of Robinson Crusoe but also a figure of English capitalism and editor of the Complete English Tradesman published in 1725. In this work, the entrepreneur didn’t hesitate to take a position against unregulated commerce. He accused it of lowering prices by drastically diminishing the jobs necessary for an equal amount of production in order to concentrate profit in the hands of a few. Werner Sombart also recalled the mistrustful attitude of Italian Guilds in the 16th century towards the first machines in the name of defending labor. So this first capitalist period remained profoundly enclosed by social life, limiting any desire for the autonomy of economic logic in relation to religious and traditional principles.

The mutation of this classical capitalism into modern capitalism began the 18th century but it only truly revealed itself in the 19th. The economy then became autonomous and was no longer subordinated to the limits of traditional society. Man was no longer the center of the economic universe. The old principle of “earn as much as possible by the doing the least amount of business possible” was no longer fashionable, on the contrary, it was to always produce more in order to compensate for ever falling prices. Commercial advertising became widespread and attempts to attract and seduce the clientele were no longer objects of moral condemnation. All the juridical and moral shackles of the past ages were treated like obstacles to destroy in order to liberate commerce. Economic efficiency became the only moral principle in business. Werner Sombart remarked the former virtues of primitive capitalism (rigor at work, a spirit of thrift and honesty) survive in the modern world but under an “objectified” form. These virtues are justified as long as they prove their economic effectiveness but are no longer followed if their utility ceases, in private life for example.

The Modern Cult of Growth and Movement

For Werner Sombart, the principal mutation of the modern capitalist spirit resides in the motive of the capitalist. In the era of primitive capitalism, the merchant was animated by the love of profit and the will to conform with Christian virtues, the latter stimulated but limited the capitalist spirit. In the modern era, the love of profit was accentuated, the virtues objectified, but the capitalist was especially moved by a new force. It is the will to grow and the love of this growth that motivates him before all. The limitless expansion of business constitutes his supreme goal. This imperative of growth suppose an absence of limit on work, production, and the creation of wealth. Werner Sombart explained that modern commercial activity achieved an unbounded wealth, but also and especially a depth and intensity previously unparalleled: “Forward, forward! Such is the watchword of our times. The advance of the market and furious commotion: that is what characterizes it before all. We know to what extent this excess of activity exhausts bodies, withers souls. All the inherent values of life are sacrificed to the Moloch of work, all the aspirations of the heart and the spirit must give way to a single interest, a single preoccupation: business.” The sociologist did not hesitate to compare this psychology of the modern businessman to the psychology of a child whose mental world rests upon permanent agitation, the desire to always attain more, the love of novelty, and the feeling of power. Education permits the regulation of such caprices by imposing limits on the desires of the child. The modern commercial ethic rests on this infantile psychology freed from any educational shackle.

This fundamental rupture brought by modernity created the cult of movement and change. Negatively perceived, stability became, on the contrary, a synonym for immobilization and sterility. At the end of the tumultuous 19th century, Charles Péguy still perceived the vestiges of the old ethic of subsistence: “They said that a man who works well and conducts himself well will surely never lack anything … this whole old world was essentially the world of making a living” whose disappearance constitutes what is properly modern: “And maybe that’s the most profound difference, the abyss that exists between the ancient, pagan, Christian, French world, and our modern world.” The dynamic of modern capitalism analyzed by Werner Sombart in the first part of the 20th century has continued to our day. The recourse to publicity and marketing, the race to lower prices, and the imperative of economic growth have intensified since the writings of the German intellectual. While the fluidification of society appears to be the ideal of the modern world now more than ever, the practices condemned by the ethic of subsistence are made commonplace. Yet one still finds significant traces of this ethic in the deontological rules of certain so-called “regulated” professions. The lawyer’s organization thus forbids the canvassing of clients from a member in the name of the principle of brotherhood and restrains advertising to preserve the dignity of the profession. Through his original approach to notions of economic growth, competition, and price determination, the historical and worldly wise analysis of Werner Sombart constitutes a relevant tool to address contemporary questions of growth and the local or alternative economy.

Source: https://philitt.fr/2017/05/22/ethique-de-subsistance-et-esprit-capitaliste-chez-werner-sombart/