When Institutions Decay

When Institutions Decay
When Institutions Decay

A review of The Great Degeneration: How Institutions Decay and Economies Die by Niall Ferguson, Allen Lane, London, 2012.

Niall Ferguson’s The Great Degeneration: How Institutions Decay and Economies Die is intriguing since the title reflects what should be an obvious connection: Social institutions do affect economies.

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The noted British historian’s latest book is a compelling demonstration of his thesis. He lays out all the symptoms caused by decaying institutions: slowing growth, crushing debts, aging populations and an uncivil society. It is clearly degeneration and even a great degeneration.

We can only admire Ferguson in his quest is to go beyond media hype and find out what really went wrong in the West. He rightly claims that “until we understand the true nature of our degeneration, we will be wasting our time, applying quack remedies to mere symptoms.”

In this short essay, Ferguson lists the four principal institutions which he affirms are in decline: representative government, the free market, the rule of law and civil society. The author masterfully shows how each one is suffering in our days. The frightening pileup of debts is threatening to burden those who come after us promising what Edmund Burke called the “partnership” between the generations, which he claims to be essential for representative government to work well. The rule of law is fast becoming the rule of lawyers. The free market is burdened under the scourge of excessive regulation. People simply are not getting involved in voluntary associations today diminishing the social capital that keeps free markets free.

These are themes that have long been discussed by scholars over the decades. Ferguson provides urgency and context to our present decline. He provides insight coupled with excellent observations that should serve as a warning long overdue. His style is clear, engaging and at times witty.

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And yet, in his search for answers, we are left wondering if the author has dug deep enough.

His work suffers from its limitations as an essay. The 152-page text is taken from his 2012 BBC Radio 4 Reith Lectures, which by its very nature limits the depth of his analysis since the book’s tone is light and slightly entertaining. There is no time to develop those pressing questions in depth that might be found in a more imposing tome with a full bibliography and index.

However, there are other questions that might be raised. We are told how the institutions decayed but not why they decayed. Institutions simply do not self-decay. We should be able to trace this decay to the decadence in the individual. There is little in the book to indicate what forces were at work in the depths of men’s souls that caused them to abandon these essential pillars. We are also given little clue as to what moral force might be employed to regenerate that which has degenerated.

The problem stems from the fact that Ferguson’s worldview is that of the Scottish Enlightenment when he felt the four pillars now in decline had reached their harmonious apogee. He thus works inside a rationalist and secular framework. As an historian, Ferguson must have observed that religious and moral institutions have always served as the most effective means to bring about a regeneration of society. Indeed, the very four pillars he lists as decaying were largely medieval institutions that developed under the tutelage of the Catholic Church. Yet he does not make the connection to suggest that a moral or religious regeneration is possible or even desirable. Such an omission is lamentable.

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Despite this omission, the book does have great value in making a link not often made. Economists have so entered into the abstract world of formulae and numbers that they simply ignore such social considerations while ignoring that economy is the result of human behavior, thus, subject to moral law. Historians tend to concentrate on events and dates. Not often do we see those who admit that social institutions absolutely affect economy. Economy needs the support of social institutions to thrive. We ignore to our detriment this central fact so well demonstrated in The Great Degeneration.

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