The Old Story: Metaphysics, Newtonian Physics, and Classical Economics

Abstract

The causes of the environmental crisis may be staggeringly complex, but the most effective way to deal with it in economic terms seems rather obvious. We must begin very soon to implement scientifically viable economic solutions for what is now a large number of very menacing environmental problems. If this could be accomplished within the framework of the theory that now serves as the basis for coordinating global economic activities, neoclassical economics, political leaders, economic planners, and environmental scientists could work together in harmony to implement these solutions. Unfortunately, this cannot happen because neoclassical economic theory is predicated on unscientific assumptions about the dynamics of market systems that effectively preclude the prospect of implementing scientifically viable economic solutions for environmental problems. These assumptions were articulated in their original form by eighteenth century moral philosophers Adam Smith, Thomas Malthus, and David Ricardo who were members of and greatly influenced by a widespread philosophical and religious movement known as deism. The fundamental impulse in this movement was to make belief in the existence of the God of the Judeo-Christian tradition consistent with the implications of the mechanistic worldview of Newtonian physics. Because physical laws in this physics completely determine the future state of physical systems, the deists concluded that the universe does not require, or even permit, active intervention by God after the first moment of creation. They then imaged God as a clockmaker and the universe as a clock regulated and maintained after its creation by physical laws. The moral philosophers we now call classical economists assumed that this deistic god created two sets of laws to govern the workings of the clockwork universe—the laws of Newtonian physics and the natural laws of economics. Based on this assumption, they argued that the forces associated with the natural laws of economics determine the movement and interactions of economic actors in much the same way that forces associated with Newton’s laws of gravity determine the movements and interactions of material objects.