Thrift: Rebirth of a Forgotten Virtue, by Theodore Roosevelt Malloch (Encounter, 238 pp., $16.95)

Waste not, want not. A penny saved is a penny earned. A bird in the hand beats two in the bush. Phrases like these were once part of America’s common economic wisdom. Especially in the twentieth century, Americans learned, through the Great Depression and two world wars, that it was better to hold on to your resources and use them wisely than to spend them recklessly or to gamble with them in the hope of making a greater gain. Indeed, the 1920s saw the rise of the National Thrift Movement, which took its inspiration from our nation’s thriftiest Founder, Benjamin Franklin. Many Americans who grew up in that era never forgot its privations, which imposed at least a partial check on their characteristic economic optimism.

These venerable phrases haven’t been heard much over the last 20 years, however. First came the Internet era, which seemed to suggest that there was no limit to the Dow Jones Index or to our personal fortunes; then the subprime-housing bubble, in which overly easy credit was joined to an unrealistic view of the free market and a failure of nerve in Washington. Traits like frugality and thrift were regarded as arcane ideas from another time, as if those practicing them wore the top hats and frock coats of somber Victorian burghers.

In his new book, Thrift, the impressively named Theodore Roosevelt Malloch seeks to return thrift to its place among commercial society’s respectable virtues. After all, the word “thrift” is cognate to the verb “thrive,” and it is Malloch’s view that thrift, properly understood, should be joined with a constellation of other characteristics that make society more just and ultimately more prosperous. Thrift does not mean poor, and its opposite is not wealth but waste. Tracing its roots to the Scottish Enlightenment, Malloch describes thrift as “a matter of the wise use of assets—accumulating where this was possible, investing where this promised a return, and avoiding waste.” Thrift is, in a sense, a principle of good stewardship and could apply to caring for the environment as well as to tending one’s bank account. It requires judgment, reflection, and the forging of sound habits that will lead to happiness. One can be generous and thrifty; the term need not, as Malloch makes clear, be equated with stinginess.

Thrift ranges widely across intellectual history, from Aristotle to the Enlightenment, from George Weigel’s reflections on European malaise to the policies that the developed world should adopt toward less developed nations, from economic theory to debates over the religious causes of prosperity. The result is a sometimes-chaotic ride through several complex subjects. Malloch is concerned, among other things, with the transition into a new kind of capitalist economy: “Instead of an economy based on saving and thrift, which launched Europe on its path of growth and prosperity, . . . we have an economy based on consumption, debt, and credit, in which saving is discouraged not only by the culture of affluence but also by the fiscal policies of governments.” Economic policy, he argues, should be directed toward reinforcing good habits of saving and proper consumption.

That doesn’t mean greater government involvement or expenditure. The rise of the welfare state over the last century, for example, has contributed to the corrosion of thrift. A government that promises everything eventually convinces the populace that it need not save or prepare for anything. This position becomes ultimately untenable, Malloch argues, sapping people’s ability to develop the habits necessary to maintaining a free society. Reliance on the government also masks the reality that government resources ultimately derive from a prosperous populace; if government action reduces those resources, its own effectiveness becomes limited. It’s curious, though, that Malloch offers not a word of complaint against the private institutions that helped further our economic troubles. While it’s true that Washington failed to restrain debt spending or to inculcate thrift, the boom and inevitable bust in housing wouldn’t have been possible without thousands of private, profit-seeking individuals and firms seeking to cash in on the frenzy.

No doubt Malloch would say that an emphasis on virtue and community-building would help lessen such destructive private actions. He notes that in a society focused on consumption, “the insatiable urge to acquire things, whether or not they are needed, has reached epidemic proportions” and “has caused severe social and cultural dislocations and warped the basic values of American society.” His shorthand solution for restoring the balance is “spiritual capital.” Michael Novak and others have long argued that a disciplined capitalism requires a complex structure of social sanction, education, and often, if not always, religious belief. While Malloch concedes that calculating spiritual capital is difficult, he brings to bear an impressive array of data that shows a correlation between prosperity and traditional religion.

Shifting at times from diagnostician to sectarian, Malloch may lose some readers, but his analysis addresses the fault lines of our current predicament. A nonjudgmental secularism combined with an amoral economic system is a recipe for economic loss and cultural degradation. Perhaps it is time to bring Franklin back into the picture.


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