Yves here. Richard Murphy, in his Economic Questions series, turns to Victorian thinker John Ruskin, who defined a critically important concept, illith, which is damaging growth or wealth creation. Even today, as an idea as opposed to under that particular name, it’s absent from discussion. We sometimes use the word groaf to signify that growth is often not what it is cracked up to be. But as Murphy explains, Ruskin’s illith is far more skeptical about the true cost of production and the benefits of accumulation. If the notion of illitih had gotten traction, it could have fostered more consideration of the damage done by climate change. dehumanizing work, and excess concentration of wealth, among other bad outcomes of capitalism.
By Richard Murphy, Emeritus Professor of Accounting Practice at Sheffield University Management School and a director of Tax Research LLP. Originally published at Funding the Future
This is one of a series of posts that will ask what the most pertinent question raised by a prominent influencer of political economy might have been, and what the relevance of that question might be today. There is a list of all posts in the series at the end of each entry. The origin of this series is noted here.
After the first two posts in this series, the topics have been chosen by me, and this is one of those. This series has been produced using what I describe as directed AI searches to establish positions with which I agree, followed by final editing before publication.
Why have I included John Ruskin in this series? As Wikipedia notes:
John Ruskin was an English polymath – a writer, lecturer, art historian, art critic, draughtsman and philanthropist of the Victorian era. He wrote on subjects as varied as art, architecture, political economy, education, museology, geology, botany, ornithology, literature, history, and myth.
I agree with that, having come across his work in a number of those fields. But I have chosen to include him here because he coined the term ‘illth’. He did so in an essay of 1860 (Unto This Last, Essay IV). His claim was that wealth is not simply the ownership of valuable things. Wealth, he suggested, only exists when value is held by those capable of using it well. Possession without purpose, capacity, or social contribution is not, he argued, wealth at all.
That argument has two inseparable components. They are that not only has the intrinsic value of property to be considered, but also the moral and practical capacity of the owner to put that value to use has to be considered before determining the existence of wealth. Where that second element is missing, Ruskin argued that riches become economically inert or actively harmful. This thinking likens hoarded assets to stagnant pools, dams blocking productive flow, or obstacles that create disruption rather than benefit. In some cases, they generate what Ruskin called “illth”. This is not wealth, but its opposite in the form of social damage, delay, and decay.
Crucially, this view does, in that case, reject the idea that the private accumulation of what can be measured in financial terms as wealth is automatically good for society. That wealth, if unused, misused, or held solely for preservation, can drain vitality from an economy rather than support it. The mere fact of ownership, Ruskin argued, does nothing for the common good unless it enables productive, purposeful action.
The implication is directly relevant today. If wealth does not circulate, or result in active investment, or does not sustain people, places, and capabilities, then it is not a national asset. It is, at best, dead weight. At worst, it can be a source of economic and social harm. This reframes the entire debate about inequality, hoarding, and the responsibilities that come with ownership. That is why Ruskin is considered here.
John Ruskin (1819 – 1900) wrote at the height of Britain’s Victorian industrial transformation. He lived through the period when railways tore through landscapes, factories reshaped cities, transforming agriculture at the same time, and when industrial capitalism first revealed both its immense productive power and its brutal human and environmental costs. This was an age that celebrated progress in iron, coal, steam and finance and measured success almost exclusively in output, trade and wealth accumulation.
Ruskin was trained as an art critic and historian, but he never confined himself to a single discipline. He moved easily between aesthetics, ethics, political economy and social reform because he believed these could not be separated. What disturbed him was not industrialisation itself, but the way Victorian society had begun to worship production while becoming blind to destruction. The new economy generated unprecedented riches, and yet it was clear that it also produced polluted rivers, disfigured landscapes, slum housing, exhausted workers, child labour, and widespread ill health. These harms were not accidents. They were integral to how the new wealth of the era in which he lived was being created.
It was in this context that Ruskin coined the deliberately jarring term illth. He did so because the language of economics had no word for what he was seeing. Everything that produced money was being counted as wealth, regardless of its consequences. Ruskin recognised that this linguistic and philosophical failure was not neutral. If an economy cannot name harm, it will reward it. Illth was his attempt to restore moral and material clarity and to insist that wealth gained through damage is not wealth at all, but its opposite.
Illth was not a rhetorical flourish. It was, at its core, an accounting intervention. Ruskin was arguing that an economy can expand numerically while impoverishing society in reality and that unless economics learns to distinguish between life-enhancing and life-destroying activity, it will systematically mislead both policymakers and citizens.
Hence the John Ruskin Question: If economic activity can generate “illth” — wealth that destroys life — why does modern economics still treat all growth as progress and all income as gain?
Illth as the Mirror Image of Wealth
Ruskin defined wealth as that which sustains and enriches life. He argued that anything that undermines health, dignity, community or nature could not be wealth, no matter how profitable it appeared. Illth was therefore not the absence of wealth but its negation: money gained at the expense of life itself.
This distinction undermines a central assumption of modern economics, which is that value is always revealed by price. Ruskin insisted that price can disguise harm. Pollution, dangerous labour, shoddy housing, environmental destruction and social breakdown can all be profitable. That profitability does not redeem them. It condemns them.
Illth is what results when markets reward harm faster than society can recognise it.
Why Economics Cannot See Illth
Modern economics struggles with illth because its core metrics cannot register it. GDP rises when forests are felled, when illnesses are managed rather than cured or even prevented, when disasters require reconstruction, and when insecurity is monetised. The accounting systems of both the private and state sectors record activity, but not consequence, and most definitely not value.
Ruskin saw this clearly. An economy obsessed with throughput will count damage as success as long as money changes hands. Illth flourishes precisely because it looks like growth. This is not a technical oversight. It is a moral failure embedded in measurement.
Labour Degraded, Wealth Corrupted
Ruskin, like many concerened people of his period (of whom Dickens and Trollope are other examples), placed labour at the heart of his critique. He argued that work that degrades the worker, whether through physical, mental, or moral exploitation, produces illth, even if it produces profit. A system that relies on exhaustion, monotony, precarity or danger is not productive. It is extractive.
This insight prefigures later critiques (such as those of David Graeber and Guy Standing) of alienation, precarity and burnout. Ruskin understood that when labour is treated purely as a cost to be minimised, the economy consumes human beings as fuel. The result is not prosperity but decay.
Illth accumulates in broken bodies, hollowed skills and diminished lives.
Environmental Destruction as Illth Creation
Ruskin was an early environmental thinker, not because he romanticised nature, but because he understood its economic role. Nature sustains life. To destroy it for short-term gain is to liquidate the foundations of future prosperity.
Polluted rivers, scarred landscapes, poisoned air and degraded ecosystems may coincide with rising incomes, but they represent a net loss. Ruskin would have recognised modern climate breakdown as the ultimate expression of illth: the conversion of planetary stability into private profit.
An economy that cannot distinguish between income and ecological ruin is not miscalculating. It is self-destructing.
Illth and Inequality
Illth is not evenly distributed. Its benefits accrue to those with power; its costs are imposed on those without. Poor housing, unsafe work, polluted environments and social insecurity disproportionately affect the least wealthy.
Ruskin saw inequality as both a cause and a consequence of illth. Concentrated wealth allows harm to be outsourced. Distance insulates the beneficiaries. The economy appears successful precisely because its costs are hidden, displaced or deferred.
Illth thrives in unequal societies because those who profit are shielded from what they destroy.
Why Illth Persists
Illth persists because it is politically convenient. It allows growth narratives to continue without confronting damage. It permits elites to celebrate success while denying responsibility. It transforms harm into externality and calls it efficiency.
Ruskin understood that an economy which cannot name illth cannot govern itself. Once damage is excluded from accounting, there is no internal brake on destruction. The system accelerates until it collides with physical or social limits.
What Answering the John Ruskin Question Would Require
To take illth seriously would require a fundamental reorientation of economic thought and policy. At minimum, that would involve:
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Explicitly identifying illth by recognising activities that generate social, human or ecological harm as economic negatives, regardless of profitability.
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Reforming national accounting by moving beyond GDP to measures that distinguish life-sustaining activity from life-destroying activity. Positives and negatives have to be recognised as such.
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Embedding labour dignity as an economic criterion by treating degrading work as economic failure, and not as efficiency.
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Accounting for ecological damage as capital destruction, not as an external cost.
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Reframing inequality as systemic risk, because illth concentrates harm and destabilises society.
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Reasserting moral judgment in economics and acknowledging that not all income is legitimate and not all growth is good.
These steps would not moralise economics. They would make it honest, and the accounting true and fair.
Inference
The John Ruskin Question forces us to confront a truth that modern economics has spent two centuries evading: some supposed wealth makes us poorer. Illth is not a fringe concept. It is everywhere: in environmental collapse, degraded work, social fragmentation and rising insecurity, all coexisting with rising monetary output.
Ruskin saw that an economy which cannot distinguish between wealth and illth will eventually destroy the conditions of its own existence. His warning was not sentimental. It was forensic. We now see all the evidence to learn from what he had to say, all around us.
To answer his question is to accept that economics must once again learn to tell the difference between gain and damage and stop rewarding the latter in the name of progress.
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Interesting concept. Thanks for sharing, had never heard of it. Once again, people in the 19th century sure were more open to questioning the basic assumptions we have gotten used to today; reminds me a bit of Michael Hudson’s point about how finance should be subtracted from GDP, not added. As a small aside, I will say that “illth” is a bit of an unfortunate term to read in serif-less font, especially when capitalized.
There was Ruskin asking why wealth doesn’t act more responsibly and then there was that other Victorian, Darwin, offering an explanation. Not that Darwin had any pretensions of being a philosopher, but his pursuit of science offered an explanation that many Victorians didn’t like. Rather than an era that was facing up to facts it was an era of great hypocrisy with a dark underbelly that did indeed contribute to the popularity of Dickens and others. In movie world the secret lives of Dickens and, yes, even Ruskin have become the fodder for some films of this era promoting a feminist consciousness.
Of course in an age of Trump it may seem churlish to criticize past societies that “couldn’t handle the truth” or at least struggled with it. Things don’t seem to have changed much.
Unlike perhaps most economics concepts, this concept of illeth is very easy to understand, doesn’t require mental gymnastics to justify, especially nowadays. It deserves to become a popular and important idea.
Yes, it does.
Though economists have conceptualized ‘external costs’, illth goes well-beyond that conceptualization.
More pertinent than ever:
“If we believe that we, as Americans, are bound together by a common concern for each other, then an urgent national priority is upon us. We must begin to end the disgrace of this other America.
“And this is one of the great tasks of leadership for us, as individuals and citizens this year. But even if we act to erase material poverty, there is another greater task, it is to confront the poverty of satisfaction – purpose and dignity – that afflicts us all. Too much and for too long, we seemed to have surrendered personal excellence and community values in the mere accumulation of material things. Our Gross National Product, now, is over $800 billion dollars a year, but that Gross National Product – if we judge the United States of America by that – that Gross National Product counts air pollution and cigarette advertising, and ambulances to clear our highways of carnage. It counts special locks for our doors and the jails for the people who break them. It counts the destruction of the redwood and the loss of our natural wonder in chaotic sprawl. It counts napalm and counts nuclear warheads and armored cars for the police to fight the riots in our cities. It counts Whitman’s rifle and Speck’s knife, and the television programs which glorify violence in order to sell toys to our children. Yet the gross national product does not allow for the health of our children, the quality of their education or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debate or the integrity of our public officials. It measures neither our wit nor our courage, neither our wisdom nor our learning, neither our compassion nor our devotion to our country, it measures everything in short, except that which makes life worthwhile. And it can tell us everything about America except why we are proud that we are Americans.
“If this is true here at home, so it is true elsewhere in world. From the beginning our proudest boast has been the promise of Jefferson, that we, here in this country would be the best hope of mankind
Robert F. Kennedy , University of Kansas, March 18, 1968
ah, Ruskin’s neologism ‘illth’ makes sense as the opposite of ‘wellth’
Thanks for posting
Super good.
NC the best
If we think of the economy in terms of a balance sheet, then the savings of the One Percent consist of claims on debtors (loans bearing interest) and property ownership extracting various forms of economic rent (and a modicum of profits). If the asset side of the economy’s balance sheet consists of such wealth, then the liabilities side is what the Victorian critic John Ruskin called illth — wealth that adverse consequences.
for debtors, renters and consumers whose payments support this privatized wealth, it is an expense – and becomes outright illth at the point where it pushes their budgets below the break-even point, driving them deeper into debt dependency and rent dependency. As the debt burden grows, the solvency of the banking and financial system becomes increasingly dependent on a dynamic that causes insolvency for a rising proportion of the population.
Yet all these extractive returns to illth are counted as additions to Gross National Product (GDP).
I have often wondered if we took out all the economic rent, unearned income, illth, wasteful and destructive (and often ill functioning) weapons systems, etc. from NIPA and GDP, what would we have left?
and maybe the most perverse example of this would be the massive productions of weapons to be used to genocide Palestine and mass murder innocents in other countries, are counted as GDP. A slightly different take on Norm Finkelstein’s The Holocaust Industry
Probably the most infuriating example of the genre of liberal I-know-you-are-but-what-am-I is the whole “Well, actually, big cities/blue states are the makers, and rural areas/red states are the takers” argument. I mean, yeah, sure, if the FIRE and tech sectors, the “defense” industry, and massively wasteful, vampiric, for-profit healthcare are bastions of Stakhanovite virtue. (Yes, I am aware that industrial agriculture, the extractive industries, and forestry are killing the planet, but, until we find something better, we do need them.)
Not using industrial agriculture to feed the industrial meat industry is something better, but I don’t see that being seriously considered.
To take a contemporary example, it seems that the Epstein scandal is the culmination of illth.
Why does so much selfish, destructive behavior richly rewarded? People have pointed out these kinds of systemic issues for centuries, so why does it continue?
I believe the answer is simple – every society with a ruling class has endless corruption and greed, and a way of life that rewards selfish behavior. We’re expected to obey laws passed by corrupt politicians and “enforced” by corrupt police. We are punished for enforcing the laws we’re given, meaning we’re forbidden from confronting injustice. That’s our way of life, and it is always problematic for obvious reasons. Whether democracy or monarchy, socialism or capitalism, the basic way of life is the same. We’re not free people, and every unfree society has the same basic way of life and the same endless troubles, like sexism, racism, corruption and so on.
There are societies not like this – what most people call native or indigenous people, or what I call healthy nations. When they live/lived in traditional times, you don’t see these problems. Sharing is normal within the society. Everyone takes responsibility to protect each other as needed and confront injustice, so justice is normal. I believe this is what “freedom” is actually like – a way of life where everyone in the nation takes deep responsibility for each other. They have no ruling class that rewards greed and sabotages solidarity. I experienced this myself visiting an intact traditional healthy nation in 2015 and they proved to me it’s possible to live with widespread sharing and mutual aid, and no rich-and-poor. Since then I’ve interviewed or read 1st-person stories from dozens of others showing what this way of life is like.
I wrote a free-to-download book called the Deepest Revolution (www.thedeepestrevolution.com) about common aspects of healthy nations in traditional times (ie native/indigenous in traditional times) showing deep commonalities that allow/allowed them to live without any illith at all – no selfishness within the nation. Not that they’re ‘perfect’, but no-selfishness is the baseline expectation and aberrations are addressed to return to that baseline. The book is based on a huge number of 1st-person accounts from many healthy nations around the world showing common aspects of this way of life and key lessons to learn. The stories are profoundly beautiful.
If anyone wanted to build a nation without illith, they first would need to learn about that way of life.
I believe the root of our persistent, systemic social ills as you describe is that humans’ evolved psychological systems for identifying and punishing free riders (and the problems their behaviour generates) which emerged over hundreds of thousands of years to suit small bands has ceased to remain effective in larger groups associated with the Neolithic revolution, and that the mismatch has only gotten worse as our groups have become larger. Yes, there have been various cultural adaptations which attempt to ameliorate the mismatch, but their success has been at best partial.
Well, it took over a 100 years but there is finally a widely used word that encapsulates his concept for all to see – AI.
Interesting concept, but it might need some tweaking to put into practice.
My family currently owns a modest amount of land that has been in the family for many generations, most of which they do not use. In recent years, wealthy people trying to escape the urban hellscapes they created have taken up residence nearby, driving up the price of real estate. If my family had to pay full price on current taxes, they would not be able to keep the family land and would need to sell some of it. Instead, they pay taxes under the ‘current use’ program, which gives a heavy discount to agricultural land. The land doesn’t have to be an active farm, but it does have to produce something every so often. In our case, that means a certain amount of timber needs to be harvested every decade or so, or taxes go way up.
It’s not a bad arrangement, but my preference would be to let the forest grow. But under the illth scheme, the unused property could be considered dormant or hoarded.
Your unused property is considered dormant under capitalism. LAB, meet LBO! :-)
I think illth has tricky definitional and operational issues because it essentially redefines wealth like a crime, in terms of actus rea, the act, and mens rea, the intent. So we would need a general principle of that which is not forbidden is wealth and then a statue book of specific wealth crimes and their defences, e.g:
– to hold an acreage unworked is a wealth offence of strict liability but with a defence of preservation of (ecological) life?
I would argue that a new form of wealth is emerging.
Alongside those who are rich because of the capital they own or the wages they earn, is a figure almost unknown to classical capitalism in the West: people who have both high capital income and high labor income (see Branco Milanovic “The Great Global Transformation”) for all the details.
Milanovic estimates (based on much detailed empirical work) that in the United States 30 per cent of the top decile of income distribution is now composed of people who belong to the top decile of the distribution of capital income and to the top decile of the distribution of labor income. This elite accounts for 3 percent of the U.S. population (30 percent of the richest 10 percent).
He also argues that this elite, if it begins to approach 10 percent of the U.S. population, may become impregnable because it will be protected from both fluctuation in real wages and returns on capital.
In other words, Milanovic suggests that the “professional/mangerial class has not supplanted the capitalist class as predicted by the theory of the managed society, but instead has fused with its apex and, by this fusion, has solved the perennial conflict between capital and labor – something, I believe, would have surprised Marx.
Milanovic also sees the new Chinese elite as similar if smaller (1.5 percent of the urban population).
Unlike its predecessors, it draws its income partly from the private sector and partly from corruption and membership in the Communist party which plays the same role that educational credentials play for its Western peers.
Yes — in his Capitalism, Alone Milanovic concludes that what he calls liberal democratic capitalism (as exemplified by the US) and political capitalism (as exemplified by China) both face the same challenge: to prevent the emergence (re-emergence?) of an hereditary oligarchy.
Thank you for this. I only learned about Ruskin as an art critic and historian. This is the first that I ever have heard of his concept of ‘illth’.
But I think that is the point of Murphy’s essay. Again, thank you. Very illuminating
“Illth” is the symptom of a disordered political economy as obesity is of the metabolically deranged body (metabolic syndrome ).