Schmoller’s Approach to Political Economy and the Debate on Value Judgements
In 1900, the first volume of Schmoller’s textbook Grundriß der Volkswirtschaftslehre appeared on the market. Schmoller’s fellow combatant in methodological matters Wilhelm Hasbach reviewed the book in a periodical comparing Schmoller’s comprehensive outline with an event 125 years earlier, the appearance of Adam Smith’s Wealth of Nations.12 This comparison was felt as provocation by many of Schmoller’s great many enemies. The conservative historian Georg von Below could no longer suppress his contempt for Schmoller and published an article seething with hatred consisting of eight continuations with hardly no arguments relevant to the point.13 Von Below seemed so furious and outraged that he did not even mind and stop insulting the reviewer Hasbach in further supplements, which the editors, several professors in strong liaison to leaders of industry, printed with concealed satisfaction.14
Three years earlier a well-to-do “saloon demagogue”,15 as he was nicknamed by friends, endowed with high rhetoric talents had written an article entitled “Ideale der Sozialpolitik”, ideals of social policy,16 which was an open challenge to Schmoller’s political economy. In this paper, Sombart continuously accused Schmoller of directing his research on arbitrary personal priorities and so erecting his political economy voluntarily on unsystematic value judgements selected at random. Sombart emphasised that social science must perceive the blind and inexorable laws of historical development. Politicians and scientists wishing to make the world more reasonable are thereafter advised to take into account from the social scientist the knowledge of what is inevitably going to happen. And since this development is inevitable, it seemed for Sombart to be a scientific decision based on scientific foresight. It would be madness, so he believed, to attempt to resist. So for Sombart, and the same applied to the social scientists and historians of other political colours and therefore believing in other–in fact opposite, liberal–ends of history, Schmoller’s recommendations for social policy were at random thoroughly arbitrary and missing any scientific justification. They blamed him not to perceive historical trends and tendencies and, therefore, to refuse to acknowledge inevitable necessities of development.
After Max Weber in 1904 had published an article demanding neutrality in economic sciences for the sake of scientific objectivity, stating that value judgements cannot be perceived by economic reasoning, the situation for those engaged in the discussion became most confusing.
Shortly later, asked by the high court at Berlin to deliver an experts opinion in an action for slander, Sombart underlined that the recommendations for social policy of the members of the younger historical school were thoroughly erroneous and arbitrary. The very conservative judges preferred to listen to the oratorical tycoon Sombart rather than trying to understand the complicated and to the sophisticated arguments of Gustav Schmoller, continuously indicating that the complainant was an opportunist and by no means in line with the opinions of the members of the socialists of the chair, as the founders of the “Verein für Socialpolitik” were called.
Sombart had so secured that for statements insulting a professional scientist being a member of the socialists of the chair for opportunistic and unscientific recommendations, nobody could anymore be brought to court and sued by action for slander .
These and many further procedures brought great confusion into the public discussion of Schmoller’s engagement in social policy lasting up to today.