View Full Version : Adam Smith

Ian McColgin
02-01-2007, 07:37 AM
"The Authentic Adam Smith" by James Buchan (Atlas Books, W.W.Norton & Company, NY, 2006) is a lovely slim biography of one of the more misunderstood figures to cast a dismal shadow to this day.

When I was in university, no econ class actually read Smith. In philosophy, I followed up my interest in Hobbes with "The Theory of Moral Sentiments" and "The Wealth of Nations" and I never could get what I read there to have anything to do with the divine Milt. Nor did the Marxist claims upon Smith's corpus make much sense. It was not till I read Keynes, Galbraith and most recently Sen that I found economists whose appreciation of Smith matched my own.

Buchan begins the book on 6 February 2005, when Alan Greenspan and Chancellor of the Exchequer Gordon Brown shared a podium at Kirkcaldy, Scotland, to celebrate Smith. Greenspan rapt Delphic on the invisible hand of free market captialism. Brown celebrated Smith's fathering of modern reformed Scottish socialism.

As Buchan put it, "The progress of the great man and his flatterers to this unfashionable shore, and the little battle done there of vanity with ignorance, would have delighted Adam Smith."

Later, explaining how we have two Adam Smiths: "The vulgar answer is that Adam Smith fell among economists and politicians who constitute, more even than professional footballers, always the least-literate sections of English-speaking society."

Anyway, this is a superb little bio that should be burned by doctrinaire Marxists and UofC marketeers. 'Taint no higher recommendation than that.

02-01-2007, 07:47 AM
dude makes good beer

Paul Pless
02-01-2007, 08:05 AM
no econ class actually read Smith.

Not sure that's quite true, while working on my degree in Economics I vividly recall reading An Inquiry into the Nature and Causes of the Wealth of Nations, at least twice.

It was not till I read Keynes, Galbraith and most recently Sen that I found economists whose appreciation of Smith matched my own.
You must not have been looking very hard...:confused:

Ian McColgin
02-01-2007, 09:09 AM
So how many times and in what contexts does Smith referr to "the invisible hand?"

Where does he advocate unregulated free markets?

Paul Pless
02-01-2007, 09:27 AM
re "invisible hand": I think its only specifically mentioned one time, in The Wealth of Nations. I'd have to dig out my Development of Economic Thought, to be sure. however, more importantly the concept is very well implied and explained many times throughout the books. Perhaps no more so, than in this most famous of all economic examples: "It is not from the benevolence of the butcher, the brewer, or the baker, that we can expect our dinner, but from their regard to their own interest."

As far as your second question regarding his advocating of unregulated free markets, I'll have to return to that after I get some work done this morning, but mostly Smith addresses free market regulation mostly with regards to 'special interests' groups and not nations per se.

One last thought for now, the true importance of Adam Smith's work and his concept of "the invisible hand", is that it laid down the natural law basis for economic thought. Any arguement otherwise is simply to revise and bend Smith's work to their own ends.:)

So Ian, are we to expect a grade on your little quiz and will grades those be posted?

Ian McColgin
02-01-2007, 11:23 AM
A++ We're all brilliant here.

I'm not now nor have I ever been an economist. I'm a philosopher and theologian, which means I know just about nothing about everything.

In that spirit back in 1967, a group of us 'Lil Sophists challenged the econ department to identify the invisible hand. They distained the challenge but we poured through the texts and found, as I recall, three examples. The self-interest portion of the invisible hand is but one part of Smith's understanding of the moral, political and economic person. He also probed sense of commonweal, pride in craft, and other values. My main problem with so much of modern economics is its disregard of profound human motivations outside those measurable by money.

Economics is a strange and interesting field in which philosophical and political notions collide with often half-baked pseudo mathematics (to wit: the Laffler Curve) to drive home some ideological point.

In natural sciences, we respect pioneers even when their formulations have been rendered obsolete. Newton still towers though so much of his corpus is useful as a practical approximation in civil engineering. No scientist would deify Newton in the way some economists have deified Smith.

My problem with Smith is not Smith, but the ex cathedra ravings of free market idolaters. Smith's brilliance shines beyond his reckless a priori untestable propositions; his imaginative anthropology, and 1349's putative wheat prices. He glimpsed how "luxury" could strengthen markets, share wealth, and increase human freedom. He couldn't fully realize the roles of population growth and entrepreneurship.

Just as I believe in land management and biologically responsible farming, so in the economy I believe in economic management for the commonweal using methods that so far as possible rely on free choices. In land management and in political economy, "natural law" provides methods for shaping things but "natural law" by itself is only the rule of the biggest weed and the top predator.

Overly central management, whether done by the state, as in the now fallen evil empire, or by large corporationa obeying economic "natural law," as now control so much of the third world, are a bit like massive sugar beet farming in the Columbia watershed.

Now, rather than overdevelop that metaphor, let me retreat to noting that economic theories usually have a political agenda. Smith bluntly noted that the state exists to protect the rich from the poor. His agenda was to find a way for the state to do that in such a manner that increasing wealth actually raised the life and the meaning of life for all.

Not a bad goal.

02-01-2007, 11:50 AM
When I read the Wealth of Nations I was shocked at how little it had in common with the ravings of Friedman and the free marketers, who, I concluded, libel Smith when they claim to follow him.

P.I. Stazzer-Newt
02-01-2007, 12:03 PM
Fleeming Jenkin, did he live entirely in vain?

02-01-2007, 01:21 PM
The important thing is to keep the masses distracted with bread and circusus, or is it Nascar and McDonalds and cheap electronics?