Marc Brammer says:

A short note for those about to enter into the world of Adam Smith – Take time to examine Book V, parts I-III. You’ll notice that Smith, quite contrary to his Laisse-faire proponants, is elucidating the beginnings of Keynes, rather than the Milton Freeman view. “The duty of the sovereign or commonwealth is that of erecting and maintaining those public institutions and those public works, which…[are] of such a nature, that the profit could never repay the expanse to any individual or small number of individuals, and which it therefore cannot be expected that any individual or small number of individuals should erect or maintain.” (Smith, Adam The Wealth of Nations, pg. 681)
Rating: 1 / 5

Len Hart says:

The greek tradition found virtue in the pursuit of rational self interest. That tradition later found expression in Adam Smith’s “Wealth of Nations” in which is posited a “rational self-interest” operating as an “invisible hand” upon “free markets”. Recent accounting crimes and corporate scandals, however, amount to enormous empirical evidence that “laissez faire” capitalism is a myth and the “invisible hand” is mere “wishful thinking”.

It is obvious that there is no “invisible hand” which militates against crooks, charlatans, and fast buck artists now seen to have firmly ensconced themselves as much in the board rooms as among sleazy fly-by-nighters.

Markets left to their own devices trend toward oligopoly in which oligarchs effect political plutocracy through the exercise of sheer political muscle, intimidation, fraud, and outright bribery.

If there is an “invisible hand”, it has never moderated the rich and powerful. If a ruling cabal is to be moderated it must be done by political action.

This is less a criticism of Smith himself than of modern economic conservatives and/or ’supply-siders’ who find in Smith –ex post facto –a rationalization for rapacious and monopolistic behavior. Smith is no more to be faulted for this than Darwin should be faulted for the excesses of “Social Darwinism” –neither Social nor Darwin. “Social Darwinists” are most often associated with the age of the Robber Barons, providing them an ideological bias that justifies all manner of corporate crookedness and sleazy practices.

To his credit, Smith himself feared the rise of monopoly power –a fear which modern conservative commentary either does not understand or omits entirely.

The picture is complicated, however by Immanuel Kant who assailed the pursuit of self interest in favor of “good in and of itself” –a “categorical imperative”. It is a moral standard that no one, of course, can live up to. Nevertheless, Kant became the other great influence upon American conservative thought –though I cannot give most contemporary conservatives credit for having actually read Kant or, for that matter, understanding him.

Yet –Kant may be found lurking beneath the ideological surface of the extreme right-wing and the religious right which seeks to impose upon us a “transcendental” reality and morality whether we like it or not.

It is unfortunate that Kant himself defined this “transcendent reality” –which he calls the noumena –as being unknowable. If follows, by definition, that one cannot make meaningful statements about it, but that has not kept righteous ideologues from deducing from this “unknowable” value judgments and imposing those values judgments on others. By definition, nothing meaningful can be said about whatever is “unknowable”!

We are given a choice of two mutually exclusive alternatives: “selfishness” or “selfless transcendentalism”. Neither position, however, is entirely true and neither is completely understood even by the conservative mentality that espouses them. Adam Smith’s “invisible hand” is no more valid than Laffer’s “trickle down” theory and it is highly doubtful that even Kant lived up to his own moral dictum –though I credit Kant with sincerity but doubt it among his followers. I rather think that “mankind” is neither entirely selfish or entirely selfless.

The truth is most likely found in the middle. The work of mathematician John Nash, celebrated of late in the motion picture “A Beautiful Mind”, wrote a brilliant paper on “binding agreements” that casts grave doubts upon many “conservative” fables, shibboleths, and fairy tales –including those whose origins lie in “mutually exclusive” intellectual traditions. Like Patton surrounded on one side by Russians and the other by Nazis, it attacks in both directions at once.
Rating: 2 / 5