Edmund Burke’s Economic Pragmatism
To Burke, ideas were best evaluated by their practical application, not ideological purity.
Commerce and Manners in Edmund Burke’s Political Economy, by Gregory Collins (Cambridge University Press: 2020), 578 pages.
Edmund Burke “discerned poetry in the elusive motions of England’s internal grain trade,” says Gregory Collins, author of Commerce and Manners in Edmund Burke’s Political Economy, a book that will prove to be one of the best studies of Burke’s thought and statesmanship. The use of “political economy” in the title is apt. Collins shows how Burke understood and justified economic policies within an overall constitutional, political, imperial, ethical, and cultural framework. He did not commit the fallacy of isolating economics as a discipline that stands above the full array of human concerns, nor did he see trade, wages, or poor relief—to name some of the issues discussed—through ideological eyes.
Burke was neither free trader nor mercantilist, neither a Lockean “natural rights” thinker nor a statist, neither a voice solely for landed property nor for only finance and trading, neither imperialist nor believer in colonial emancipation. In Burke’s reasoning, the ultimate test for any idea was not its abstract purity but its application in concrete circumstances, which revealed its utility, economy, and soundness.
Collins confronts what he calls “Das Edmund Burke Problem”: How could the Burke of the Reflections on the Revolution in France, who powerfully upheld tradition, also favor a wide berth for freedom of economic exchange? Market economies are dynamic to the core and unsettle communities and cultures. They seem to favor the autonomous individual over the socially and historically embedded person that Burke favored. Can Burke really defend market liberalism and avoid a thicket of his own contradictions? Collins answers this difficult question in layers of analysis that probe deeply Burke’s various public interventions.
Burke understood that economic interactions are guided by dispersed knowledge, culture, and ethics. Collins underlines the degree to which Burke’s thought precedes Hayek on the problem of knowledge and markets, namely how market transactions build on local and discrete pieces of information in order to serve multitudes of consumers. Buyers and sellers come to one another with built-in wants, thus markets are in a sense from nature, Burke stresses. Labor’s purpose is to receive a wage, a process most must engage in for their maintenance. Thus begins the answer to the complexities of Burke’s political economy. Burke never cleanly separates government from the market as John Locke and other natural rights theorists did. He saw government joined to and a guarantor of the relations of citizens in their full range of pursuits, but he also understood that this connection was tender, relational, and rendered to foster flourishing of persons and not to dominate them or use them for the abstracted and monolithic goals of the state.
One of Burke’s most direct statements on political economy occurs in his 1795 letter, “Thoughts and Details on Scarcity.” Britain faced bread riots, rising costs of food, labor unrest over wages, as well as general problems associated with industrialization. In “Thoughts and Details,” Burke confronts head on calls for wage regulation (minimum wages), welfare provision, prohibitions on middlemen, price controls, and the establishment of public granaries or a “public option” for grain. In the face of spiking prices, Burke provides an impressive defense of mostly insulating the grain trade from regulation. He states that “indiscreet tampering with the trade of provisions is the most dangerous, and it is always worst in the time when men are most disposed to it: that is, in the time of scarcity.”
Under the jostled conditions of the grain market at the time, there were calls to support struggling workers by raising their wages. Burke dismissed it as short-term folly with dismal long-term consequences. This attempt to lift wages above what their labor demands from a willing buyer would in the end fall hardest on the laborer. As Burke describes, “the stone which we had forced up the hill would only fall back upon them in a diminished demand.” The related hazard of raising wages artificially would be to increase the price of food in a time of shortage. Burke emphasizes that labor is subject to all the laws of supply and demand. Good intentions, as we might say, are never enough.
What Burke also uncovered is that market failure exists, in this case, in the shortages in supplies and the spike in food prices that had negatively impacted many in England. Did it follow that the state, with a raft of policy interventions, would somehow improve the situation? Wasn’t the faster course, as Burke describes at one point, for prices in the distressed grain market to clear and reach equilibrium? This would permit investment, planting, labor, and selling to begin again, albeit with short-term adjustments that would be painful. The alternative was to lock into place a less dynamic and productive market, even if fewer people were unemployed in the short term. The market recovery would take longer to arrive and would never be robust in growth. As Collins notes, Burke never uses terms like “unintended consequences.” But he makes the point repeatedly.
The merit of Collins’s book, one that this review cannot give full justice to, is how he amplifies Burke’s career by showing how economic reasoning figured into his overall thought. The “Speech on Economical Reform” (1780) that Burke delivered for three hours in the House of Commons focused on the need for government reform. Burke displays an incredible command of the budget and the extensiveness of the Crown’s holdings, which he stresses were wasteful and duplicative. Many of the Crown’s properties were poorly managed and generated little return, Burke explained. Selling them to private owners would provide income from the purchase of the holding, and as they became more profitable, revenue in taxable income to the government would increase.
Burke’s effort, Collins notes, wasn’t only about reducing the size of government, laudable as that is. Burke justifies his stratagem by arguing that government would actually be stronger, more competent, and would receive more revenue by a reduction in certain responsibilities. The objective for Burke here was not necessarily to liberate the private sector from state control on libertarian lines, but for government to protect the liberties of the people by governing well. If it did so, Burke notes, the government would become more vigorous, not less.
In the intense debate over imperial trade with British North America and the West Indies, Burke’s thoughts are found in a coauthored essay entitled “An Account of the European Settlements in America” (1760), which sounded many of the economic themes. Burke cannot be classified as a free trader, even though his support of the Free Port Act of 1766, which established six free ports in Jamaica and Dominica, loosened overall trade in North America, including with French possessions. Likewise, Burke unflaggingly supported a greater opening of trade for domestic Irish producers, even to his political detriment as traders in his Bristol constituency did not support such measures.
Burke supported the Navigation Acts, which ensured that the commerce of the colonies primarily benefited the mother country. He believed that England deserved recompense for the efforts and protections it rendered to its colonies. Burke held that Britain could regulate the colonies’ domestic affairs but also that such regulation should be light and done for proper reasons, allowing the colonists to continue in their course of growth and flourishing. Such sage advice was not ultimately taken by the Crown in Parliament, despite Burke’s eloquent protestations in his “Speech on American Taxation” in 1774 and “Speech on Conciliation with America” in 1775.
Burke defended the British East India Company’s monopoly in India because the company was the spearhead of trade in a remote part of the globe and thus deserved a certain measure of protection. However, the trader also became the sovereign in parts of India, and vast corruption and abuses ensued from this interlocking concentration of power. The East India Company for its profit had undermined local businesses and workers, taking over the Indians’ economy. This certainly empowered the company, but it worked to the detriment of Indians and ultimately the empire, which was left with control of a declining, uncompetitive economic situation. Burke resolutely opposed the East India Company’s abuses of Indians, which led to his failed attempt to impeach Warren Hastings. However, Burke never seemed to make the connection between the incentives created by its trading monopoly and the company’s myriad abuses. His sound economic judgment in other realms seemed absent from his India policy considerations.
Collins closes with a deep reflection on how Burke differed with Scottish Enlightenment theorists on the foundations of markets and how they could best be maintained. The Scottish Enlightenment theorists posited that modern commercial markets were almost sui generis. Commerce had created new manners and codes for society that were self-perpetuating if they were allowed to flourish by permitting individuals to peacefully and productively pursue their economic self-interest. While Burke sounded at times very similar to Adam Smith or David Hume on the positive effects of trade and careful government regulation, he differed from them on what had established commerce.
For Burke, the Christian religion and the numerous cultural and ethical practices it had produced was the soil that commerce emerged from. The honest and upright conduct that commerce required was embedded in a moral framework that was backstopped by a biblical code woven in English institutions. This is one avenue to understand his vehement opposition to the French Revolution. Burke viewed its levelling of the Bourbon monarchy, the Church, marriage laws, and paper money as a dissolving instrument that would remove not only French culture and institutions but also the ethics and manners of the nation. France would burn itself down.
Versions of this debate continue between conservatives and libertarians today, but it is increasingly difficult to think Burke was in the wrong. We live in a period of incredible affluence, and yet vast portions of our clerisy instinctively blame markets for creating inequality, pollution, racism, alienation, and atomism, among many, many ills. The solutions are heavy-handed, technocratic attempts to make markets serve perfectionist goals that will reorder us, e.g., the Green New Deal. The path rejected is one that says markets reflect our loves, ethics, and culture, as Burke knew. If we are disordered, so too will be our marketplace. Reckoning with this inconvenient truth is one of many treasures that Burke’s political economy brings us. For that, and more, Gregory Collins deserves much praise.
Richard M. Reinsch II is editor of Law & Liberty, host of the podcast Liberty Law Talk, and coauthor with Peter Augustine Lawler of A Constitution in Full (Kansas Press: 2019).