Capitalism and the Jews
By David Henderson
My co-blogger, Arnold Kling, posted yesterday on American Jews and politics. I found the articles interesting, but I wonder if any of the Commentary writers are aware of Milton Friedman’s attempt to explain why Jews, who have done so well under capitalism, are, on average, so hostile to it. I don’t think Milton made a slam dunk in explaining it and, if you read his article, you’ll see that he didn’t think so either. I won’t repeat his argument, but I do want to highlight the curious case of Werner Sombart.
Sometime in my undergrad career, I read (I can’t remember where) that Werner Sombart, a German intellectual, was anti-Semitic. I had no reason to doubt that and so, every time I came across his name, I had an instinctive repulsion. I never actually tested the proposition by reading Sombart. Friedman points out why he was considered anti-Semitic and why Friedman thinks Sombart was actually a philo-Semite.
Sombart’s book, I may say, has in general had a highly unfavorable reception among both economic historians in general and Jewish intellectuals in particular, and indeed, something of an aura of anti-Semitism has come to be attributed to it. Much of the criticism seems valid but there is nothing in the book itself to justify any charge of anti-Semitism though there certainly is in Sombart’s behavior and writings several decades later, [this comma should be a semi-colon; otherwise the sentence makes no sense] indeed, if anything I interpret the book as philo-Semitic. I regard the violence of the reaction of Jewish intellectuals to the book as itself a manifestation of the Jewish anti-capitalist mentality. I shall return to this point later.
And he does return to the point, writing:
I interpret also in this way the attempt by Fuchs to trace Jewish “liberalism” to Jewish values and the negative reaction of Jewish critics to Sombart’s book. If, like me, you regard competitive capitalism as the economic system that is most favorable to individual freedom, to creative accomplishments in technology and the arts, and to the widest possible opportunities for the ordinary man, then you will regard Sombart’s assignment to the Jews of a key role in the development of capitalism as high praise. You will, as I do, regard his book as philo-Semitic. On the other hand, if you are trying your level best to demonstrate that Jews are dedicated to selfless public service in a socialist state, that commerce and money-lending were activities forced on them by their unfortunate circumstances and were wholly foreign to their natural bent, then you will regard Sombart as an anti-Semite simply reinforcing the stereotype against which you are battling. In this vein, the Universal Jewish Encyclopaedia says in its article on Sombart: “He accused the Jews of having created capitalism” (my [Friedman’s] italics).
Consider, for a moment, the reaction to the anti-Semitic stereotype by a nineteenth-century English Philosophical radical steeped in Benthamite utilitarianism–by a David Ricardo, James Mill, even Thomas Malthus. Could one of them ever have termed the allegation that Jews created capitalism an accusation? They would have termed it high praise. They would have regarded widespread emphasis on rational profit calculation as just what was needed to promote “the greatest good of the greatest number,” emphasis on the individual rather than the society as a corollary of belief in freedom, and so on.