An Economic Critique of Pragmatism

I've been doing a little reading in America's great philosophical tradition, pragmatism, and in general I like what I see. Get to the point people, tell me why it matters. "Monism" or "pluralism," why does it matter? Pretty soon you get to such abstract notions that no one but two old men care one iota. Coincidentally, one of those men suspects that the other intentionally spilled water on his tweed coat during a seminar 30 years ago, and the other that vociferiously denies the allegation, and is quite bitter about it. Angels on dancing on the head of a pin.

As an economist, however, I must advance a criticism of the following statement from William James:

The great English way of investigating a conception is to ask yourself right off, "What is it known as? In what facts does it result? What is the cash-value, in terms of particular experience? "And what special difference would come into the world according as it were true or false?" (Emphasis in original.)

What if I were to take a suitcase of $100 bills with me to visit one of those Amazonian tribes just coming in contact with the outside world? What would be the cash value of such a suitcase? It might be worth $1,000,000 when I get on the boat to go up the river, but what it is worth when I get there, is going to depend on whether I can convince the tribe that this paper will be accepted almost anywhere else in the world in exchange for goods and services, that its value will be maintained (hopefully these days!) because it is backed by a economic and military superpower, and that people everywhere basically trust this superpower to pay its obligations and thus maintain the currency. They may trust me, and thus take the cash and create their own dollarized economy, ensuring that I am very well taken care of with my now substantial wealth. They may read the newspaper I brought with me talking about the current debt ceiling negotiations, and put me on the next boat out of town.

The point is, cash value doesn't exist unless a standard by which values are measured is established. (One does not explicitly need cash to do this as in a barter economy, but one of the functions of currency is to act as a numeraire.) Biological value is not a bad place to start, I will immediately be concerned about how many dollars I can exchange for a tasty grilled sloth. But, as the massacres over seeminly petty doctrinal issues during the Reformation and Counter-Reformation indicate, our concerns in life are not merely biological. In fact, the current nastiness over the teaching of evolution is, at its core, a fight over whether the biological is primary or the spiritual is primary. Perhaps, if I had a religous restriction on eating grilled sloth, I would be truer to my values by starving instead of eating its devilishly tasty flesh?

Does this throw out pragmatism? No, not at all. Pragmatism is a very useful solvent to dissolve issues that are inherently silly because fighting over them obscures implicit agreement on a host of values that are far more consequential. It can help us move past the abstract to issues of significant political, social, and spiritual consequences, which may underlie the abstract debates. A small abstract detail can radically change the standard by which the world and objects and actions in it are valued. We should count ourselves lucky that those abstract details are carried out in irrelevant debates, rather than with tanks and jets.