Issue

11th Issue (March, 2009)

Early and Modern Buddhist Economics

K.S.Chow

Introduction

Western classical Economics   is the study of a set  of  principles or theories pertaining to decisions made by people and businesses in relation to economic activities of production, market and  consumption  of goods and services, and  national economy including Gross Domestic Product (GDP), unemployment, national income, growth rate and price levels (1). The modern Buddhist Economics  is spiritually improved through the conglomeration of  Buddhist principles and Ethics and  Western classical Economics.  The spiritual desert of the secular Economics is moisturized with the  water of spiritual oasis.

Early Buddhist Economics

If Economics is confined to the study of micro-economic and macro-economic theories defined integratedly by the western classical  economists, such a modern Buddhist economics had never been promulgated by Gotama Buddha.  Economic activities were transacted in the ancient India in the 6th century B.C.E contemporary to the emergence of Gotama Buddha.  The ancient cities contemporary with Gotama Buddha were already urbanized or economically organized. There was a social division of labour into divergent occupations, such as the warriors, farmers, hunters, slaves and so forth. Hence, ancient Indian economic activities existed in ancient Indian cities, such as Sāvatthi and Rājagaha. Gotama Buddha’s economic admonition  to the Buddhist householders constituted the early Buddhist Economics. The Exalted One’s admonition touched upon the acquisition, possession, protection, management , utility of wealth, deontological ethics between employer and employees, right livelihood , poverty, equitable distribution of wealth and the like.

Gotama Buddha’s closest lay Buddhist  disciple and a foremost patron, Anāthapiṇḍika  donated  the Jeta Monastery (Jetavana-ārāma) to the Exalted One. He  was a very  affluent millionaire operating his business empire along both sides of the Ganges River. He was foremost in generosity  and a chief patron of the Buddha. (2) Most beautifully, he actualized the first stage sainthood (sotāpanna) moment before his demise. This evidences that wealth (secularity) and Dhamma (spirituality) do not collide. With Dhammic training of the Noble Eight Fold Path, wealth generates generosity. Generosity(dāna) perfects morality (sī̄la). Morality perfects concentration (samādhi) . Concentration consummates wisdom (paññā).

 Besides delivering Dhamma  discourses on serious issues of Buddhist spirituality, the Master had also delivered Dhamma discourses of householders’ simple economy. These Dhamma discourses on simple Economics  for householders can be considered to be classical or early Buddhist economics. The Exalted One integrates economic activities and management with Buddhist principles and ethics . In other words, secularity and spirituality can be interpenetrated as long as the wisdom of  Selflessness (Anattā) is developed.  Anattā is the negation of selfishness and prioritizes public interest over self-interest. Conventionally put,  Anattā is the annihilation of self-interest in public interest. Selfless service raises productivity. Selfless service is Dhammic service . Dhammic service in working environment  is Buddhist Economics. Buddhist Economics raises productivity and produces happiness simultaneously.

Modern Buddhist Economics

Today, in response to the complete and advanced evolution of  modern economics, economic activities and problems have necessitated the formulation new and more complex economic theories and practices. However, modern complex micro-economics and macro-economics were  unheard during the time of the Buddha when corporation of businesses had not  been developed in India. Hence, Gotama Buddha expounded Dhamma on only householders’ simple economic theories and practices. Since business corporation did not exist, it did not necessitate the declaration of corporate Economics by the Exalted One.

Having scrutized, and ascertained the strengths and weaknesses of modern Economics, the altruistically compassionate Buddhist scholars including members of Saṅgha and lay Buddhist disciples have formulated their modern theories and practices of Buddhist Economics. Modern Buddhist economics are altruistic Economics which sanctifies  modern economic activities so that they concur with the Dhammic principles and values . The agenda of sanctification of modern Economics is to ensure that success is actualized in this world as well as in the hereafter.

Succinctly put, the sphere of economics, in which  Buddhist principles and  ethics are incorporated in modern economic activities in sole proprietorship, partnership and companies of the Buddhists, is designated as Buddhist Economics. The designation of Buddhist Economics is immaterial. What is spiritually  beneficial is that economic activities or practices  are sanctified to protect the wellbeing of the human society and the ecosystems and to insure a better rebirth in the next life. The sanctified aim is three-fold: Firstly, it elevates the Gross National Happiness (GNH) of a nation. Secondly, it promotes and fosters sustainable development. Thirdly , it insures success in this world as well as success in the next world.

Thus,  the agenda of formulation of  Buddhist economics theories by the modern Buddhist leaders or savants  is sacred and dear. They should be extolled for their right efforts.  It is aimed to help the Buddhist householders or lay Buddhist to acquire, protect, utilize or manage and  share  wealth  in accordance with the Dhamma. In this manner,  their undertakings of the Noble Eight Fold Path is not impeded by their moral flaws in their economic activities or enterprises . Their right view and  right thoughts of right livelihood should be extolled by all. Eminent modern Buddhist economic thinkers or intelligentsia  include E.F. Schumacher, P.A. Payutto, Prime Minister of Burma, Unu, Santikaro, Buddhadāsa, Shinichi Inoue and  others.

Shumacher’s Buddhist Economics

E.F. Shumacher writes in his celebrated text ‘Small is Beautiful: Economics as if People Mattered’ thus:

It is clear, therefore ,that Buddhist Economics must be different from economics of modern materialism, since  the Buddhist  sees the essence of civilization not in  a multiplication of wants but in  the purification of human character. Character,  at the same time, is formed  primarily by a man’s work. And work properly conducted  in conditions of human dignity and freedom, blesses those who do it and equally the products.(3)

Modern economics emphasizes maximum production of goods and service and consumerism. However, Buddhist economics stresses on the purification of mind and character. Purification is the annihilation of self-centric ego while being engaged in economic activties. How work is performed by Man moulds his character and determines the direction of next rebirth or salvation . If he does his work selfishly, he is a man of selfishness. If work is performed righteously or ethically, one is blessed by his virtues and the products of his service. If the economic activity is ethical and concurs with Buddhist principles and ethics, it is Buddhist economics.

 Conversely, unethical economic activity is not Buddhist economics. Non-Buddhist economic activity is wrong livelihood.  If the economic activity concurs with the Dhammic principles and values, that is selfless service. It is praiseworthy. Purified character which is freedom from cankers (sins) is equally recommended by other world’s religions. Buddhist economics is  no exception. Essentially, Buddhist Economics and economic activities not contradicting with Buddhist principles are also considered Dhammic Economics.

Dhammic Economics is altruistic Economics orientated towards the win-win situation of mutual welfare and happiness through the preservation of  sustainable development. Whether we are Buddhists or not Buddhists, the Process Reality of human society and the eco-systems are non-sectarianism and non-denominationism. The communal wisdom of Anattā and Pațiccasamuppāda are meant for all. Ethics and Unity are for all. We cannot be divorced from the dependently co-risen Unity in the multiplicity and the multiplicity in the Unity. We are all integrated in one interconnected  world of the inseparable interpenetration between the phenomena world the Principle. We are always integral parts of the dynamic unity of causes and conditions.

E.F. Schumacher, an economic consultant to the Prime Minister of Burma, U Nu in 1955 defines Buddhist Economics thus : Buddhist Economics  is a set of economic principles  partially inspired by Buddhist beliefs that an individual ought to do good  work  to ensure proper human development.  Buddhism requires a Buddhist to commit wholesome actions (kammas) through right livelihood in his or her economic activities. It is even more praiseworthy if he or she  can obliterate his or her self-centric ego in order to purify his or her character. In this manner, he attains success in this world as well as in the next world. Economic wealth is pursued without scarifying or sulling one’s character development. Character development determines the direction of rebirth after death of present life.

Payutto’s Buddhist Economics

Another eminent Buddhist exponent of Buddhist Economics is Ven. P.A. Payutto, a universally acknowledged Thai foremost Buddhist scholar. Ven. P.A Payutto expounds  Suttas and Vinaya, Sociology, Environmental ethics, Economy, Law  , Science and Technology. Ven. P.A Payutto’s Theories of Buddhist Economics  are derived from his profound insight into Buddhist process philosophy of perennial wisdom. He perceives ultimate Reality as the dynamic process becoming (santāna dhamma) synthesized from the unity of causes and conditions. Abhidhammically put, the process becoming is the incessant flow of the unity of interdependent physical and mental phenomena (dhammas). He advocates that Buddhist Economics must concur with the Dhamma of Process Reality. He  affirms that Dhamma operates in terms of two levels of Truth, namely conventional truth and Ultimate Truth.

The conventional truth pertains to the isolated ethical consideration of personal ethical behaviour (cariyādhamma). The ultimate Truth is related to the Dhamma of cosmic unity of dynamic process becoming (saccadhamma or Sabhavadhamma). (4). The core of Buddhist conventional truth is  the Buddhist law of moral accountability (Kamma-vipāka-dhamma) . Buddhism emphasizes right livelihhod which does not transgress the Five Precepts (Pañcasīlas) and the Ten Wholesome Course of Actions (Dasasīlas).The Law of Kamma states that  what one sows, so shall one reap. Wholesome kamma breeds wholesome fruit (kusalaphala); unwholesome kamma breeds unwholesome fruit (akusalaphala). The Buddhist law of moral accountability is equally applicable in economic activities.

Ven. P.A Payutto expounds that Sabhavadhamma (Reality) include all things and laws by which they operate. Dhamma  is used to describe the entire moving stream (unity)  of causes and conditions, the process  by which  all things  exist and function.(5). Sabhavadhamma is consonant with the dynamic process becoming (sanātana dhamma). According Ven. Payutto , all economic activities must resonate with the Dhamma of Process Reality. The equilibrium or the harmonious flow of  Process Reality must not be obstructed by human morally deficient economic activities. The current financial meltdown and eco-crises are the disasters resulted from the impedement of the Dhamma of the Process Reality of the Unity of existence of causes and conditions due to human moral flaws of greed and irresponsibilities.

Ven. P.A concludes that Economics  is just one integral part of a vast interconnected whole .Therefore, Buddhist economic activity must take into consideration how it may affect the well-being of the human society and the natural environment. He warns that if economic activity ignores its negative effects on the human society and the natural environment, Man will confront future crises which may not be easily mitigated or fixed. The 2008 financial crisis and ecocrisis have corroborated Ven. P.A. Payutto’s  foresight and forewarning . Thus, we perceive that the Dhamma of Ethics  and the Dhamma of ultimate Process Reality must be integrated to produce sustainable development of 
Buddhist Economics.

Another modern eminent Thai  intelligentsia, Ven. Buddhadāsa, expounds that success or accomplishment in the world is contigent upon the harmonization with the Dhamma of Process Reality- the continuum of life process. In short, mundane world must be spiritualized in order to synergize it. Chinese- philosophically put, whatever we do or perform must concur with Tao. Tao is Dhamma of Process Reality. This is what he writes:

For everything to succeed in this natural world , it must harmonize with , be in line with Dhamma, follows and serves the Law of Nature. Anything that fits with, conforms to, follows from and serves the Law of Nature is Dhammic. (6).

The law of nature is the eternal ultimate Truth of  Dhamma . Dhamma is the Process Reality of dynamic Process becoming (sanāta dhamma). The Process Reality is dynamic Unity of contigent causes and conditions. Every human being and human activity is an integral part of the interconnected whole. The whole is cosmic Unity of contigent conditions in which human activities including economic activities are conditioning and are being conditioned . Therefore, the human economic activities must not be alienated from the Dharma of Process Reality of conditioning and being conditioned.

Ethically deficient economic activities disharmonize the Totality or the Whole of Process Reality. It impedes accomplishment and even may damage accomplishment. The 2008 financial meltdown and the co-crisis are concrete examples of the collapse of the Dhamma of Process Reality. Monotheistically put, it shatters the mound unity of God . The face of God has been disfigured or Tao has been obstructed . The concrescence of the world is diminished because of the promotion and fostering of a-Dhamma. A-Dhamma is impediment of Dhamma . Impediment of Dhamma is obliteration of natural flow of the cosmic Unity or cosmic Self (Dharmadhātu).

If one favours self-interest  disfavouring public interest, this opposes the Buddhist doctrine of Selflessness (Anattā). Opposing Anattā is a-Dhamma. It obstructs the dynamic flow of unity of causes and conditions. The causes and conditions are the physical and mental phenomena (rūpa-nāma-dhamma). Whoever annihilate self-centric ego practises Anattā - the unity of existence .

Anattā is the true Dhamma in which  individuality is obliterated to foster unity of process becoming. Total Quality Management (TQM) is a Dhammic concept of Anattā. Anattā is synonymous Buddhist doctrine of Emptiness (‘Sūnyatā). Emptiness is the unity of causes and conditions. TQM oversees  the ethical economic production of goods and services. All contigent causes and conditions are ethically introduced or imposed to ensure high productivity with a comfortable and righteously earned  profit margin. Without productivity, there is no accomplishment. Accomplishment  is the fruit of Dhamma. Negation of Dhamma negates accomplishment .

TQM is actually a form of Buddhist Economics successfully implemented by the Japanese business corporations. The Japanese are basically Buddhists whose economic miracle after the second world war was actualized by the wisdom of  Buddhist Zen or Chinese Tao.  This  spiritual wisdom was imported from imperial China. Zen Buddhism and Taoism are communal Truth of Wisdom. It has  impacted  Japanese Business culture of Quality Control Circle (QCC) and TQM. QCC and TQM are shining examples of Buddhist economics fruitfully practised in Japanese business culture.

A Dhammic life of a Buddhist  is living and working together harmoniously and cohesively to realize a common goal in any enterprise including economic and non-economic activities. Dhamma is the spirit of interdependence and integration in human family, social or business intercourses. All work integratedly and cohesively to realize the congruence of goals- common interest of welfare and happiness for all.

The Kingdom of Bhutan first formulated and implemented GNH (Gross National Happiness) since 1960s.(7). GNH is the economic indicator  measuring the national economic growth rate as well as the index of happiness of the citizentry of Bhutan. It improves upon the traditional or classical economic growth indicator of GNP (Gross National Product). The policy of GNH is orientated towards the cultural promotion and  good polity. It is aimed at eliminating spiritual desert in a secular state worshipped vigorously globally. GNH is the macro-Buddhist Economics which is also designated as altruistic Economics (8).

Japan is another nation which implemented Buddhist Economics of GNH after the devastation of the second world war. Japanese GNH is designated as ‘Net National Satisfaction Index’ as the economic indicator to measure the happiness of the Japan citizentry.(9) The Buddhist economic policy of the Japanese polity has been so successful that it has resulted in the following enchanting accomplishments . Firstly, Japan has emerged as a super-economic power house  after the second world war. Secondly, Japan has totally abandoned utilizing her military might to bully or colonize other nations after the second world war .We cannot deny the fact that U.S- Taiwan Relation Act is one of the contigent conditions which appease  Japan’s military ego.    Thirdly, Japanese miraculous economic model has been emulated or  is  being emulated by other south-east Asian economic tigers through the highly celebrated look-east policy. Malaysia is one of  the most vigorous nations who has emulated Japanese work ethics in the past two decades.