Many believe that the science of economics began with the Scottish moral philosopher Adam Smith’s The Wealth of Nations. In fact, the origins go back further to Richard Cantillon, an Irish Catholic Jacobite, whose life is shrouded in controversy and mystery.
Given his life story, it is hardly surprising that it has taken so long to recognise Cantillon as the true founding father of economics. His Essai sur la nature du commerce en général, written around 1730, is his only surviving work. In it, Cantillon argued that “The land is the source or matter from whence all wealth is produced. The labour of man is the form which produces it: and wealth in itself is nothing but the maintenance, conveniencies, and superfluities of life.” He outlined a theory of circulation – his main contribution to economics.
Cantillon was not primarily interested in economic theory. Rather, he wrote in support of his legal defence against usury charges. He cut a fierce reputation for making fortunes at the expense of others and was mixed up in the two major financial scandals of the day, the Mississippi Scheme and the South Sea Bubble, earning him many enemies. His escapades extended to matters of the heart: he banished his wife of 10 years to a convent for six months.
Reasons for his life being surrounded by mystery and conjecture are threefold. First, his birth was not registered, though we can narrow it down to the 1680s in Ballyronan, in the parish of Ballyheigue, County Kerry. Secondly, he took care to cover his activities as a banker and a Jacobite. Thirdly, he reportedly died in a fire which destroyed his papers, leaving us scant records. Later reports speculated that this may have just been a ruse and that he had instead escaped to Suriname in South America. Yet records show that he was buried in the grounds of the Anglican St Pancras Old Church in London.
Henry Higgs, the translator of Cantillon’s work into English, said of the thinker that he “brushes ethics and politics aside as imperiously as the referee orders the seconds out of the ring in a prizefight”. Higgs thought that Cantillon wasn’t especially devout, based on his decision to settle in London and his daughter Henrietta’s marriage to a member of a prominent Northern Irish Protestant family.
Emigrating to Paris in 1714, Cantillon had prominent enablers, including Lord Bolingbroke, a leader of the Jacobite cause who fled to France, who introduced him to the likes of Montesquieu and Voltaire. He took up the position of chief assistant to a second cousin, also named Richard, at the latter’s bank. Within two years, he had bought the bank. Cantillon became banker for the Stuart court in exile, as well as most of the British and Irish émigrés in Paris.
The Marquis of Mirabeau – a physiocrat, or believer in the primacy of natural law and order and that agriculture is the source of all wealth – argued that Cantillon must have been a Protestant, on the basis of a passage in the Essai attacking the idleness of monks, especially the mendicant order. In an argument that finds an echo in Max Weber’s The Protestant Ethic and the Spirit of Capitalism, Cantillon said the evidence showed that countries which embraced Protestantism became visibly stronger. By suppressing religious holidays, societies reclaimed work hours totalling nearly an eighth of the year. He also attributed the decline in French cloth manufacture to the expulsion of the Huguenots.
Mirabeau could be excused for doubting that a Catholic would write such things. But Cantillon was tackling labour as a cause of wealth and simply argued that idle monks and mendicants were “unproductive”.
Cantillon’s attitude towards usury laws contrasted with the teaching of scholasticism. He argued that interest rates on the market were proportionate to the risks of default, and that high interest was the result of high risk, not of exploitation or oppression. He noted that later Catholic scholastics had eventually, albeit reluctantly, agreed to allow high interest rates for riskier loans. Finally, he argued against imposing ceilings on interest, because only the lenders and borrowers could determine their own fears and appetites.
The weight of extant evidence indicates that Cantillon was a Catholic, but one who intellectually separated faith from his economic work. He acted pragmatically by remaining neutral towards the Church in Ireland, for reasons of persecution, and in France because of the potential tax burden. Perhaps, like his second cousin Philip, Cantillon would have described himself as “an unworthy member of the Catholick Church”.
His end was as mysterious as his beginning. He may not have died in a fire after all. It seems that he was murdered, in 1734, by his French cook, and his body was set on fire in order to disguise the killing. He was not the first Catholic or Jacobite to die in highly suspicious circumstances. But he is perhaps the only leading economist to have been murdered.
Dr David Cowan is an author and critic. His new book The Coming Economic Implosion of Saudi Arabia: a Behavioural Perspective (Palgrave Macmillan) is due out later this year
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