Bigger is Better or Small is Beautiful

Sep 10, 2016

By Anil Netto
In the 1990s, during the Mahathir adminstration, the country embarked on major infrastructure projects — some of them like the Crooked Bridge of questionable benefit to the masses.

Is bigger really better?

The economist, EF Schumacher, pointed out three areas that he was brought up to believe. The family was the smallest unit in society, then came the tribe, then a combination of these constituted a nation and then we had a union of states or a federation. And finally it was believed that some sort of single World Government would emerge.

But then, a number of countries started breaking up and today we have 206 listed states, which comprise 193 UN member states, two with observer status in the UN (the Vatican and Palestine) and 11 other states (including Taiwan).

So there are contradictory forces at work here.

Many of us are also brought up to believe that Bigger is Better, whether it is a country, a school, a university, even a church complex.

Another widespread mainstream economic belief is ‘economies of scale’ — the bigger an operation or enterprise, the more likely we can achieve profitable efficiency and savings, thus lowering unit costs.

At the same time, there is a recognition that even in big organisations, the idea of smaller lively semi-autonomous units that have their own sense of achievements, common vision and goals, will help the larger organisation achieve its overall goals. A sense that decentralisation might be better.

That is one reason why we have BECs, even though we are all part of the Church.

A country that is a federation would work more efficiently if power is decentralised to the local level, where public participation in decision-making can be encouraged. This would be line with the principle of subsidarity in Catholic Social Teaching, which Schumacher encouraged.

He pointed that in terms of size, there is a duality in human requirement. Even large organisations need to work with active personal relationships.

The Church may be a large organisation, but we are also called to love our neighbours at the local level – those around us inneed.

“For every activity, there is a certain appropriate scale, and the more active and intimate the activity, the smaller the number of people, the greater is the number of such relationship arrangements that need to be established.”

For example, a school may be large, but what might work best is fewer pupils in each classroom so that teachers can give more individual attention.

As for a city, Schumacher believed that the optimum number of residents in a city would be half a million. He did not believe that a city of several million people had any advantage over smaller cities. In fact, he felt that large cities “merely create enormous problems and produce human degradation.”

Indeed, some of the great cities in ancient history had much smaller populations. For example, ancient Athens only had a population of 250,000 in the 5th Century BC.

Schumacher had a point. Business Insider recently carried a report about the 17 happiest cities in Europe based on European Commission data and found the following: “You might think that Europe’s biggest, most vibrant metropolises like Paris, Rome, Berlin, and London are where people enjoy life most, but in general it is actually smaller, less busy cities, where people are at their happiest.”

These tend to be cities where the environment is clean and green and where the state is able to provide strong safety nets for the welfare of the people.

One of the serious problems we have today is rural-urban migration. Improvements in communications and transport have made people more “footloose” (as Schumacher put it) and mobile. So millions have deserted rural areas in the belief that bright city lights would provide more opportunities for education, welfare and jobs. But at the same time, such migration places great strains on urban public services such as hospitals and schools and roads.

Schumacher felt that calls for autonomy, self-government and so-called independence are “simply a logical and rational response to the need for regional development”.

Unfortunately, in many countries, most of the resources, finances and infrastructure projects are concentrated in the capital and major cities, making the rich there even richer.

So that leaves those in the rural areas with little choice but to migrate into the big city, “where their condition will be even more miserable”.

Conventional economics tends to treat labour as a cost that should be minimised; it tends to bypass the poor, lamented Schumacher.

“An entirely new system of thought is needed, a system based on attention to people and not attention to goods…

“We must learn to think in terms of an articulated structure that can cope with a multiplicity of small-scale units” rather than abstract statistics of economic growth and national income, he said.

If we cannot get past such “vast abstractions and make contact with the human realities of poverty, frustration, alienation, despair, breakdown, crime, escapism, stress, congestion, ugliness and spiritual death, then let us scrap economics and start afresh.”