The Economic Writings of Ezra Pound

Ezra Pound is the poet who, a thousand times more than any other man, has made modern poetry possible in English.

Donald Hall, Remembering Poets

No doubt Eliot, James Joyce, William Butler Yeats, Robert Frost, William Carlos Williams, H.D., Ernest Hemingway, Ford Madox Ford, and Marianne Moore would have produced interesting and innovative work whether they had known Pound or not.

The New Yorker

Although many have tried to erase him from memory, Ezra Pound still stands with Mark Twain, Herman Melville, and Nathaniel Hawthorne as one of the great American writers, and most will still admit that he is America’s greatest poet. He’s famous for not only defining the modernist poetry movement with works such as Ripostes, Hugh Selwyn Mauberley, and The Cantos, but also for mentoring and promoting many of the twentieth century’s most important writers including T.S. Elliot, Robert Frost, William Butler Yeats, Ernest Hemingway, James Joyce, and D.H. Lawrence. 

On the other hand, Pound is also famous (or rather, infamous) for a series of pro-Fascist radio broadcasts made in Italy during World War II. After the war, the US government shied away from trying Pound for treason and instead chose to lock him up in St. Elizabeth’s Hospital for mental illness (even after he had been found fit to stand trial in Italy). According to literary scholar Hugh Kenner, the reason for Pound’s being committed was to “prevent the ideas expressed in his broadcasts from being inspected” by the public at large. In short, the folks at Nuremberg were likely worried that the public might hear something that they agree with. 

Lesser known than his poetry or even his radio broadcasts are the economic writings of Ezra Pound, and these are what we will be examining in this article. Outside of his poetry, his two major works on economics are A B C of Economics (a 127 page treatise which Ezra Pound wrote in 1933 to “get the subject off my chest”) and Money Pamphlets (a series of pamphlets written during WWII). 

Pound’s definition of an economist is the foundation from which he writes: “The economist is the man who knows WHAT the board, official or unofficial SHOULD do for the continued well-being of the nation.”

Contrast this with investopedia’s definition of an economist: “An economist is an expert who studies the relationship between a society’s resources and its production or output.”

The difference? Pound’s economist must be working for the good of the nation, and mustn’t be working to subvert the interests of the country for the benefit of his employers. As Pound wrote:

No economic system is worth a hoot without ‘good will’

This being said, let us begin. Pound’s writings have three main veins. The first, which he wrote about in 1933, was meant to tackle the problem of overproduction. The second and third are best laid out in his wartime pamphlets and seek to find a method of dealing with the deflationary pressures of hoarding cash and find a way to achieve “honest money”.

The 1930s Economy 

Probably the only economic problem needing an emergency solution in our time is the problem of distribution. There are enough goods, there is superabundant capacity to produce goods in superabundance. Why should anyone starve?

To set this in context, the world had just fallen into the Great Depression. The economy was changing: for millennia, the most serious problem facing humanity had been the ability to produce basic necessities, but during the Industrial Revolution a much smaller workforce could produce the same amount of goods. This newfound efficiency was putting large numbers of people out of work, resulting in a lack of demand. With less demand came less production, putting even more people out of work and things continued to spiral downward. 

Up to this point, many of the modern “solutions” to overproduction had not yet manifested. Planned obsolescence, the cultivation of widespread addiction, mass advertising, and consumer culture were all still in their infancy. 

Fascism 

The only countries that were able to prosper in the 1930s had governments which were Fascist or influenced by the Fascist model. These countries began to employ excess labor in service of the public good. At the same time they instituted programs and laws which controlled business and finance in a way which also benefited the nation.

Although during WWII Ezra Pound touted Fascism as the only system whose “surgeon’s knife” can cut the “cancer of usury” out of the life of the nations, he was actually against promoting Italian-style Fascism in America.

This is not to say that I “advocate” Fascism in and for America, or that I think that Fascism is possible in America without Mussolini

Pound believed that a country could take inspiration from the successes of other nations, but he was not an ideologue. He believed that there “may be several economic solutions to any problem,” and that 1930s America was not suited for a Fascist government.

There is no use in thinking about shoving this state of things suddenly onto a totally different people with utterly different habits.

Instead he called himself a “Jeffersonian Republican”, spoke frequently of Martin Van Buren, and highlighted the toughness of character it took for 1830s Americans to free their treasury from the “bogey men” bankers.

I think the American system de jure is probably quite good enough, if there were only 500 men with guts and the sense to use it or even with the capacity of answering letters, or printing a paper.

He further states:

The point is that the orders of an omniscient despot and of an intelligent democracy would be very much alike in so far as they affected the main body of the country’s economics.

Overproduction 

In A B C of Economics, Pound recommends an entirely unique approach to the “distribution crisis”. 

IT IS…UNDENIABLE that if no one were allowed to work (this year 1933) more than five (5) hours a day, there would be hardly anyone out of a job and no family without paper tokens potent enough to permit them to eat.

Pound’s solution, which might get labeled as a form of distributism, probably still possesses quite a bit of appeal to readers of today. This kind of idea is one that many folks may have already thought about themselves: use our increased productivity to decrease the amount of time spent working. The theory is that with wealth widely distributed, demand will be high and the economy will prosper. Moreover, Pound wanted to create a more leisure-based lifestyle for Americans. In fact, he seems to want them to live a similar lifestyle to that of an artist.

Let the man work four hours for pay, and if he still wants to work after that, let him work as any artist or poet works, let him embellish his home or his garden, or stretch his legs in some form of exercise, or crook his back over a pool-table or sit on his rump and smoke. He would get a great deal more out of life, and, supposing him to have any rudiments of intelligence, he would be infinitely more likely to use it and let it grow, and in any case he would ‘get a great deal more for his money’…I know, not from theory but from practice, that you can live infinitely better with a very little money and a lot of spare time, than with more money and less time. Time is not money, but it is almost everything else.

In 1933, although he didn’t dismiss the idea of an “American dividend” (a universal basic income)*, he believed his idea was more primary—not only because of its simplicity but also because of the human emotions of pride and belonging. [*discussed below]

The simplest road is via work, and I suspect any other. This is also the first instinctive outcry. It is empirically observable that the first thing men ask for is work; and only after refusal do they cry out for free food. If this statement indicates a great naive trust in humanity I am willing to stand the charge.

The Concentration of Wealth into Fewer Hands

Pound was profoundly influenced by C.H. Douglas, an engineer-turned-economist who had challenged the traditional economic theories of Ricardo. Douglas had collected data from more than 100 large British businesses and found that all, except those becoming bankrupt, were paying out less in salaries, wages and dividends than the costs of goods and services produced each week—i.e. the workers were not paid enough to buy back what they had made. This not only posed another problem with distribution, but implied that eventually more and more of the wealth would wind up in the hands of an elite few. 

Pound borrowed a potential solution from Douglas to deal with the problem of hoarding: currency with depreciating value. The purpose being that those who accumulate money will soon have valueless paper whereas those with lesser means will always spend their money when it is at its peak value for them. Pound mentions a real-life example:

Gesell, the South American monetary reformer, saw the danger of money being hoarded and proposed to deal with it by the issue of “stamp scrip.” This should be a government note requiring the bearer to affix a stamp worth up to 1% of its face value on the first day of every month. Unless the note carries its proper complement or monthly stamps it is not valid. This is a form of TAX on money and in the case of British currency might take the form of 1/2d or 1d per month on a ten shilling note and 1d or 2d on a pound. There are any number of possible taxes, but Gesell’s kind of tax can only fall on a man who has, in his pocket, at the moment the tax falls due, 100-times, at least, the amount of the tax.

Honest Money 

Theoretically, the problem of hoarding should lead to deflation and/or economic stagnation. However, in the real world we also have the banking sector which has the ability to create money (and inflation) through loans. Pound addresses the corruption involved in this process.

…all the official governmental schemes for inflations yet proposed leave out the question of control. That is to say, the place of control is a dark room back of a bank, hung with deep purple curtains. No one must see what happens. What happened in the Bank of the U.S.A. before Mr Van Buren set up an Independent government treasury? What happened?…Inflation for the benefit of the few. 

An alternative inflationary pressure (to counteract the deflationary pressure of hoarding) is the “American dividend”, i.e. giving money directly to the public rather than granting money creation rights to banks and having them loan it to the public.

…we have at our disposal a large volume of SOCIAL CREDIT, which can be distributed to the people as a bonus over and above their wage packet. Douglas proposed to bring up the TOTAL purchasing power of the whole people by a per capita issue of tickets PROPORTIONAL to available goods. In England and the U.S. today available and desired goods remain unbought because the total purchasing power (i.e., total sum of tickets) is inadequate. Mussolini and Hitler wasted very little time PROPOSING. They started and DO distribute BOTH tickets and actual goods on various graduated scales according to the virtues and activities of Italians and Germans. Douglas may object that this is not “democratic” (that is egalitarian) BUT for the monetary scientist or economist the result is the same. The goods are getting distributed. 

He also proposed a Jeffersonian solution to our currency problems. He recommended that the reader get this Jefferson quote framed on his wall:

“…And if the national bills issued be bottomed (as is indispensable) on pledges of specific taxes for their redemption within certain and moderate epochs, and be of proper denominations for circulation, no interest on them would be necessary or just, because they would answer to every one of the purposes of metallic money withdrawn and replaced by them.”

—Jefferson to Crawford, 1816.

Conclusion 

Let’s go back in time to when these decisions were being made. A time when Americans still bought their houses with cash. 

To address the problem of decreasing availability of currency, would we have been better off issuing an annual national dividend to every citizen rather than increasing usury to the point where 80% of the population is in debt?

 And as you sit your tired, obese body down on your IKEA furniture (that’s designed to break by next year) and watch television advertisements, let’s consider the problem of overproduction: would we have been better off decreasing the hours of work rather than using behavioral psychology to manipulate people to overconsume?

If the answer to these questions was something other than what we actually did, the question becomes how will we change now? Pound believed that the WILL to implement change is the most important thing. He also believed a public consciousness of key economics principles is essential to the establishment of such a WILL. 

No economic system can be effective until a reasonable number of people are interested in economics; interested, I should say, in economics as part of the problem: what does and what does not injure others.

Otherwise a society will be exploited for their ignorance by those who are more aware. In addition:

STATE AUTHORITY behind the printed note Is the best means of establishing a JUST and HONEST currency.

It is a moral imperative to achieve a sane economic system, not only for the good of the country, but for the eugenic preservation of the human race.

Until we have decent economics the sane man will refuse to overbreed. And pity for the large poor family will continue to be pity for idiotic lack of prevision.

So we’ve got our work cut out for us: spread the word, and let’s get some people into power who know about these economic issues and aren’t dupes of the financial elite. You don’t have to look too far. Just check out New Frontier’s political platform (click here).