Thinkers before their time 1: Leopold Kohr

The present global economic crisis, we are told, is one of demand. People around the world have stopped spending enough. The result is an economic slow down leading to recession and, potentially, a full-blown depression. The answer, we are also told, is that we need to increase growth. Yet, how can we reconcile that with our also being told to be concerned about global warming and climate change, the result of ever increasing carbon emissions caused by increasing economic activity?

It seems to me that we need a better way of looking at these problems. Which is why we’re giving special attention over the next few days to two economists who, in their heyday in the 1970s, were certainly thinking before their time. Tomorrow we give the spotlight to Fritz Schumacher who was briefly famous in the 1970s for the title of his book that became ever associated with his name Small is Beautiful.

Thinkers before their time Tomorrow Virginia Isaac reflects on the legacy of her father Fritz Schumacher. On Monday we publish Old Wine, an essay by Leopold Kohr on political leadership.

Schumacher always acknowledged that a major source of his ideas was a lesser known economist Leopold Kohr (1909-1994). His mantra was the simple but generally ignored notion that problems are more difficult to solve the bigger they get. As he once wrote:

“The answer to bigness is smallness, not still larger units, just as the answer to the Deluge was the Ark of Noah, not the Titanic. His contemporaries called Noah a lunatic. Maybe he was. But it was from him that we descend. The experts all drowned.”

In other words, Leopold Kohr’s abiding idea was that when something is wrong, something is too big. He was always on the look out for things that were, as he put it, of an appropriate size or scale. He thought Wales, with its three million people, was the appropriate size for a nation, which was one reason why, later in life, he came to live among us. In the 1960s he chose to “retire” in Aberystwyth – he said it was a town of entirely ‘appropriate’ size – as a lecturer in political philosophy in the extra Mural department in the University. He became a close friend of Gwynfor Evans and doubtless with him in mind, published a remarkable little book in 1971 called Is Wales viable?

However, he had published  his defining book The Breakdown of Nations 15 years earlier, in 1957 in the United States. The thesis was that small states, small nations and small economies were more prosperous, more creative and more peaceful than great powers or superstates. Kohr argued that continued growth would inevitably lead to only one possible outcome: collapse. Arguably we are approaching this tipping point in 2011.

However, at the time The Breakdown of Nations was published, the space age was about to be launched, and the general view was that the bigger economies were  the better. As Leopold said at the time, his critics “dismissed my ideas by referring to me as a poet.”

Leopold Kohr belonged to that Austrian-German Jewish emigration of genius during the later 1930s, including Freud, who changed the entire intellectual nature of the world outside Central Europe – affecting psychology, physics, mathematic, aesthetics as well as economics. He was born in the village of Oberndorf, in the province of Salzburg, where the carol Silent Night was penned. Leopold always claimed that it was the smallness of Salzburg which enabled it to pick out and promote the local boy called Mozart.

Kohr studied law at Innsbruck, followed by the London School of Economics, and finished his studies as a political scientist in Vienna. He worked as a freelance journalist during the Spanish Civil War, met George Orwell, and like him was deeply impressed  by the anarchist experiment with the city state in Barcelona.

The rise of Hitler and the Austrian Anschluss drove him into exile, first to New York and then Canada where, apart from beginning his study of economics, he spent some time gold prospecting. From 1943 to 1945 he worked as a research associate in charge of customs union projects at the Carnegie Endowment for International Peace, in Washington. He finished The Breakdown of Nations at Rutgers University, New Jersey, in 1953 but had to wait four years before it was published.

By then he was ensconced as Professor of Economics at the University of Puerto Rico where he stayed for 20 years. In that time he produced many essays that were published in local newspapers, eventually brought together in two essay collections The Inner City (1989) and The Academic Inn (1993). At Puerto Rico Kohr first formulated his “Velocity theory of population’, suggesting that “the mass of the population increases not only with every addition to its numbers … it increases also with every acceleration to the speed at which the population circulates.”

He wrote a good deal on what he termed the ‘under-developed nations’, especially in Africa where he was a major influence on the founding President of Tanzania, Julius Nyerere. Kohr argued that aid to developing countries merely led to dependency, ideas he expounded in his book Development Without Aid. Nyerere’s ideas on self-sufficient agricultural production in Tanzania derived partly from this source.

On one occasion, in London in 1970 Fritz Schumacher introduced Leopold Kohr who was about to deliver a lecture on The Breakdown of Great Britain as “a whole man”:

“…an economist who looks beyond, through, above, and behind economics and cheerfully puts economics in its place; at the same time: an artist, an historian, an adventurer, a man of the people who can equally walk with philosophers and kings. In this schizophrenic age, such people are rare. Most of the time they go unrecognised. The age recognises specialists who are persona grata with the other specialists. Whole men are normally unpopular with fragmentary men.”