Politics & Epistemology of Economic Numbers in Britain

A review of Calculated Values: The Politics and Epistemology of Economic Numbers in Britain, 1688-1738, by William Peter Deringer.

Over the past decade, interest in “political arithmetic” has surged. More importantly, it has diversified. Defined by one of the subjects of this excellent dissertation, Charles Davenant (1656-1714), as “the Art of Reasoning by Figures, on Things relating to Government,” political arithmetic has long been seen as a key moment in the prehistory of “scientific economics” and statistical demography (Charles Davenant, Discourses on the Publick Revenues, and on the Trade of England. London, 1698, p.2; see William Letwin, The Origins of Scientific Economics. London: Methuen, 1963). But whereas many twentieth-century treatments were content to leave it at that, more recent scholars – with Michel Foucault’s work on biopolitical governmentality, Ian Hacking’s on probability, Lorraine Daston’s on historical epistemology, and Steven Shapin and Simon Schaffer’s on the political and social contexts of seventeenth-century natural philosophy under their belts – have invested the subject with significance beyond the history of social science per se.

Calculated Values looks like the culmination of this turn, or series of turns. Taking a generation of scholarship on board, it offers the first (ever, to my knowledge) full-length examination of the use of numbers in debates around the British imperial state and economy in the half-century after 1688 – a periodization that encompasses and convincingly extends the “golden age” of political arithmetic, more usually seen as ending in 1714 with the death of Queen Anne. Deringer’s avowedly ambitious but nuanced and well-argued excavation of the use of numbers in a series of linked and very public episodes across fifty crucial years (crucial for quantification and the British empire alike) is in this sense the study of political arithmetic for which historians of economics, of Britain and the Atlantic world, and of science and epistemology have been waiting. The wait may be over: one chapter has already been published (William Peter Deringer, “Finding the Money: Public Accounting, Political Arithmetic, and Probability in the 1690s,” Journal of British Studies 52, 2013, pp.638-668), and it is difficult to imagine that the rest will remain unpublished for long.

One can sum up Deringer’s key move in a deceptively simple claim: namely, that the combatants in the arguments he surveys were arguing not merely with numbers, but more fundamentally about them: about their uses, their promise, and their limitations. What this implies is that far from an abstruse, academic matter, the problems of knowledge associated with quantification and calculation were in fact pressing, and public, political issues. In short, and in marked contrast to most work on these episodes, Deringer is less interested in which party won which fights – or even in the point, made to wonderful effect in his conclusion (p. 408), that they often ended without clear winners – than in the fact that “No matter who won or what was settled, the numbers remained” (p. 10). The real victor was quantification.

If this sounds familiar to readers of Foucault, Hacking, et al., it should be noted that on Deringer’s account, quantification came to the fore not primarily as an instrument of state power or a guarantee of empirical accuracy – though its obvious potential in both regards was vital to its public profile – but rather as the lingua franca of political argument. Here, indeed, Deringer builds as much on the best recent work on late Stuart political culture (Mark Knights comes to mind) as on recent histories of science and social science. In each successive chapter and through each successive debate, we are shown a little more of what numbers could be made to do precisely in the absence of an omnicompetent central state and in conditions of extremely imperfect information – or, as Deringer puts it, how “in the newly participatory, representative political context of eighteenth-century Britain, some kinds of expertise were necessarily built both inside and outside the state” (p. 22). To use a period term, expertise was a series of projects.

The first chapter sets the reemergence of political arithmetic after 1688 (its originator, William Petty, having died in 1687) in the context of attempts to deal with the state’s near-total ignorance of its own accounts, initially by a Whig Parliament frustrated with a handful of individuals’ monopolization of information. The result, a Commission of Public Accounts, was by most measures a failure: it left behind no auditing mechanism and made no lasting mark on the behavior of the state’s servants. Yet if the Committee’s reports were “aspirational,” these aspirations – the systematic collation of the state’s fiscal data and its use as a tool for evaluating the government – were important, and seen to be so on all sides. It was Tory economic writer Charles Davenant whose analyses, extrapolations, and gestures towards statistical confidence both justified and publicized political arithmetic as an art of probabilistic reasoning about government from partial data.

The second chapter takes on a major political arithmetical “project” of the 1700s, the attempt to determine the cost of Scotland’s political union with England, figured as the monetary “Equivalent” of a Scottish future no longer to be. Here the two key movers – an emblematic combination if ever one was – were the projector and financier William Paterson (1658-1719) and the Newtonian astronomer and mathematician David Gregory (1659?-1708). Tracing both the conceptualization of the Equivalent and the technical calculations necessary to realize it, Deringer shows poignantly what was at stake in seemingly arid debates: in presenting financial calculation as a model for governmental rationality in circumstances where the object being monetized was the national future itself, the political-arithmetical proponents of Anglo-Scottish Union asked Scots “to decide whether they were willing to put political faith in something they could not understand, and to believe that the calculations of itinerant financiers and mathematicians could decide what was best for Scotland” (p. 144). They were not the last nation to face this choice.

The next chapter deals with a more famous yet equally elusive mathematical object, the balance of trade, brought to the forefront of public debate by the possibility of revived Anglo-French trade following the Peace of Utrecht in 1713. Here the main challenge was not quantifying the unquantifiable but instead navigating discordant and self-interested sources of information – a problem of trust not in numbers themselves, but in the relation between mercantile interests, the public good, and accurate knowledge. Now, more than earlier it seems, party-political distinctions came to underwrite epistemological differences, as Tory proponents of a Commerce Treaty tried (with little success) to produce a useful figure by asserting computational expertise as a solvent of interest while the Treaty’s Whig critics made an “epistemic pillar” of interest itself. Yet, again, the upshot – as first Whigs and then Tories criticized the proffered estimates of the balance of trade – was a “victory for calculation itself” (p. 219). Computation and counter-computation was now the idiom of political morality.

Chapters 4 and 5 turn to the most notorious miscalculation of the era, the South Sea Bubble. The first of the two looks at the valuation of South Sea Company stock not as a failure of economic rationality (the lens through which this episode is usually seen) but rather as a window onto “the state of economic knowledge” (p. 227). Lacking even the degree of institutionalization that natural philosophy enjoyed at the time – and subject to a similar set of suspicions – the construction of this kind of financial knowledge was very much a project, resting on no established set of principles but dependent instead on analogies to better-known modes of quantification (such as land valuation), with only the bubble itself to act as an “epistemic filter” (p. 279). Picking up from there, Chapter 5 considers Archibald Hutcheson’s (ca. 1659-1740) attempts before and after the bubble burst to peg the intrinsic value of stock (and by implication, the just price) to a set of variables only Company insiders could have knowledge about – laying the burden of blame at the Directors’ door and bequeathing to posterity both an interpretation of the bubble and a model of financial ethics.

The final chapter turns back to the future: not as something to be priced, as in Chapter 2, but instead as something to be conquered through calculation. This is the story of the “Sinking Fund” – Robert Walpole’s (1676-1745) vehicle for paying off the national debt by earmarking specific state revenues for repayment of the debt’s principal and funneling the resulting annual reductions in interest into repayment as well. That the fund, “a largely untested financial project” (p. 381), was a dead letter within seven years of its creation matters less to Deringer than the political hegemony of computational logic it reveals – and the ever-increasing proximity of a figurable and manipulable future that that logic implied. The future the Sinking Fund promised was reachable but by no means inevitable: it had, as Deringer puts it, to be “made by political actions” (p. 389). These actions would be framed, pursued, scrutinized, and if necessary unmade, all in the now familiar language of political arithmetic.

A brief conclusion returns to Deringer’s central theme, now rendered as “the fundamental elevation of calculation in the culture and cognition of British politics in the half-century” after 1688 (p. 395) and linked to wider changes associated by recent intellectual historians and historians of science (some named at the beginning of this review) with the early Enlightenment: the rise of probabilism, inductivism, and predictive knowledge claims. Alive to these “big” questions, Deringer nevertheless stresses that what he has given us is at its core much more circumscribed: a story of “the strangely robust bond that has come to exist between numbers and political truth” (p. 406), rooted in the political vicissitudes of the post-1688 period, the fruit not of an Enlightenment canon but of the half-realized projects of middling or marginal English and Scottish “projectors,” for whom claims to expertise – in a world before disciplines – were invariably aspirational, probability was as much a claim to professional legitimacy as to epistemological reliability, and numbers were as freighted with moral as with material significance.

This dissertation represents a major contribution to the field. It brings together in one sustained examination of political arithmetic’s public, metropolitan, political career insights and questions hitherto more often applied to more delimited archives, shorter periods, or more marginal spaces (as with my own work on William Petty and political arithmetic in the Restoration, which Deringer engages with constructively in Chapter 1) or later themes (as with Andrea Rusnock’s episodic study of medical arithmetic in the English and French Enlightenments). Deringer does this, further, while displaying a technical grasp of the questions involved that surpasses most earlier treatments, not least in the imaginativeness with which it is made to illuminate the intellectual horizons of the actors involved. This aspect of Deringer’s work, in particular, should speak directly to once core audiences for the subject – historians of economics and economic historians most notably – whom scholars taking their cues from cultural history or the history of science have sometimes been content to leave behind. Once published, in short, Deringer’s work will be very difficult for anyone concerned with the political resonance of economic quantification in the eighteenth-century Britain or Enlightenment Europe to ignore.

Ted McCormick
Department of History
Concordia University

Primary Sources

The British Merchant, or, Commerce Preserv’d: In Answer to The Mercator, or Commerce Retriev’d. 103 issues. London, 1713-4.
The Mercator: or, Commerce Retrieved, Being Considerations on the State of the British Trade… 181 issues. London, 1713-4.
Davenant, Charles. Discourses on the Publick Revenues, and on the Trade of England. London, 1698.
[Walpole, Robert]. Some Considerations Concerning the Publick Funds, the Publick Revenues, and the Annual Supplies, Granted by Parliament. Occasion’d by a Late Pamphlet, Intitled, An Enquiry into the Conduct of our Domestick Affairs… London, [1735].

Dissertation Information

Princeton University. 2012. 467 pp. Primary advisors: Michael Gordin and Linda Colley.

Image: Edward Matthew Ward (1816-1879), Hogarthian image of the South Sea Bubble. Tate Britain and Wikipedia Commons.

Leave a Reply