I've said it before and must (alas) repeat it ad nauseam. Many of our modern struggles -- in the U.S. and across advanced societies -- could be altered if both sides actually (for the first time) read Adam Smith.
The left would learn that he was not the viciously cruel exploiter of the masses that dopey campus ranters portray him, but rather, the first modern thinker to propose a generally flat and fair (if highly competitive) society, one moderated with many kindnesses that he defended in The Theory of Moral Sentiments. Though yes, he maintained that society could better afford kindness if it maintained a vibrantly creative -competitive marketplace for great new products and services. A forecast of stunning accuracy.
The left would learn that he was not the viciously cruel exploiter of the masses that dopey campus ranters portray him, but rather, the first modern thinker to propose a generally flat and fair (if highly competitive) society, one moderated with many kindnesses that he defended in The Theory of Moral Sentiments. Though yes, he maintained that society could better afford kindness if it maintained a vibrantly creative -competitive marketplace for great new products and services. A forecast of stunning accuracy.
Conservatives would realize that Smith praised competition as the greatest creative force… but that competition's top enemy is not always a government civil servant! There is another, older enemy of enterprise and freedom, that crushed opportunity and competition in 99% of societies across 6000 years. The principal enemy of freedom and markets denounced by Smith was monopolistic or conspiratorial oligarchy, of exactly the kind that the American Founders rebelled-against.
Here's a summary I found recently: "Ironically, Smith's epic work The Wealth of Nations, which was first published in 1776, presents a radical condemnation of business monopolies sustained and protected by the state, in service of a lordly owner-caste. Adam Smith's ideal was a market comprised of small buyers and sellers. He showed how the workings of such a market would tend toward a price that provides a fair return to land, labor, and capital, produce a satisfactory outcome for both buyers and sellers, and result in an optimal outcome for society in terms of the allocation of its resources.
"He made clear, however, that this outcome can result only when no buyer or seller is sufficiently large to influence the market price—a point many who invoke his name prefer not to mention. Such a market implicitly assumes a significant degree of equality in the distribution of economic power—another widely neglected point." (excerpted from David C. Korten's book, When Corporations Rule the World.)
It is an argument made forcefully later by Friedrich Hayek, another genius whom the right idolizes in abstract, while betraying almost everything that Hayek stood for, such as maximizing the number of skilled, empowered and knowledgable competitors and thwarting conspiracies among monopolists and oligarchs, whether those were rooted in government bureaucracy or in narrow owner elites.
This was the point of the Progressive Movement 100 years ago, creating anti-trust laws that shattered the then-looming Gilded Age oligarchy and restored competition to American markets. It had to be done again in the 1930s and 1940s, resulting in the flattest and most vibrantly entrepreneurial society and fastest-rising middle class the world had ever seen (and shocking the hell out of Marxists, who thought their teleological forecasts could never be reformed away.)
That flattish society (I call it "diamond-shaped) was the product of reforms instituted by the "Greatest Generation" that is much admired on the American Right, for overcoming a depression and Hitler and containing communism. Alas, for their narrative, the Greatest Generation also adored Franklin… Delano… Roosevelt. Their innovations so reduced class disparities and class friction in America that the Boomer generation grew up assuming that such things were behind us forever.
== But human nature had not been abolished. ==
Alas, "class struggle" is a sure theme of our present times. As Smith would tell you, cheaters always find a way to come back, as the flat social order is once again being crushed by skyrocketing (French Revolution-level) wealth disparities, monopoly and oligarchy. Raising the question… can Americans do it again? React not with radicalism or excesses like socialism, but with steel-eyed moderate reforms that restore flat and open competition for another generation? History shows far more instances of the former, than the latter.
"In the real world of unregulated markets, successful players get larger and in many instances use the resulting economic power to drive or buy out weaker players to gain control of ever larger shares of the market. In other instances "competitors" collude through cartels or strategic alliances to increase profits by setting market prices above the level of optimal efficiency. The larger individual and more collusive market players become, the more difficult it is for newcomers and small independent firms to survive, the more monopolistic and less competitive the market becomes, and the more political power the biggest firms wield behind demands for concessions from governments that allow them to externalize ever more of their costs to the community," writes David C. Korten.
Adam Smith again said it best, defying the stereotypes and cliched images of him.
"When the regulation, therefore, is in support of the workman, it is always just and equitable; but it is sometimes otherwise when in favor of the masters.”
He saw a tacit conspiracy on the part of employers "always and everywhere” to keep wages as low as possible.
Does that sound like the guy who you were taught believed only in dog-eat-dog? Or that only billionaires are "job-creators"?
No wonder today's "libertarians" -- all-too caught up in the hallucinatory web spun by Rand and Rothbard and by Koch-financed "think tanks" like Heritage and Cato -- never refer anymore to the "First Liberal" and the founder of true libertarianism. Because Adam Smith would remind them that the real foe of enterprise has -- for 6000 years -- been owner-oligarchy and monopoly. The very forces that are rigging our elections and subsidizing propaganda that has driven a third of our neighbors crazy, re-igniting the American Civil War. So crazy, they proclaim that only government bureaucrats can harm capitalism, enterprise or freedom.
(A side note: I dare anyone to attribute my assertions here to a scintilla of leftism! Competition is the great, creative driver of our positive sum markets, science, democracy... It is in defense of those creatively competitive arenas that we must, today, face down a bizarre madness that has taken over the American Right.)
(But hang on till the end of this posting, to when I cite a very high authority on this!)
== Smith… the judo master ==
The crux is this. If liberals (and not their crazy leftist allies) want to do a real jiu jitsu move on the mad right, instead of engaging in futile sumo… then liberals should with agility reclaim the "First Liberal" -- Adam Smith -- and hammer their opponents with him! It is the one move that would take them utterly by surprise, winning over millions of moderates and small businessmen. Try saying this:
"So stop listening to paid shills pushing a return to feudalism! Come negotiate with us over how to keep it all open and healthy and competitive... and so productive that we can take on the countless challenges ahead."
At the bottom of this article you will find some amazing quotations from the father of flat-even-open-fair capitalism… everything that oligarchs and socialists both hate.
== The Cult of the Anti-Smiths ==
Want to see how blatant and hateful the apologists for oligarchy have become? The latest monstrous rationalization (from Forbes): "Give Back? Yes, It's Time For The 99% To Give Back To The 1%."
Yes, it is randianism/murdochianism in full, shameless fury. Please… please go read the rant, then come back here. I'll wait.
Alas, as usual, this screed makes no distinction between the wealthy who actually built companies that coalesced the efforts of thousands of skilled engineers to deliver win-win goods and services -- e.g. Jeff Bezos, Larry Page, Steve Jobs --
-- versus the other clade that became billionaires either via state-subsidized resource extraction or financial connivance among a cheater-cartel of 5000 CEO-caste golf-buddies.
-- versus the other clade that became billionaires either via state-subsidized resource extraction or financial connivance among a cheater-cartel of 5000 CEO-caste golf-buddies.
The former group certainly deserve to be rich! Though note, that most of the creative-goods-and-services billionaires are also … democrats! Who have signed the Buffett Giving Pledge and who express loyalty to the Smithian mixed society. So much so that they support higher taxes on the rich! (See Larry Page's most recent effort to use his wealth to help us all in a win-win fight to halt aging.)
Alas, the wealthy lords whom Randians admire most as "job creators" do nothing of the kind. They are those whom Rand herself called "looters" while the tech moguls who are most like Ayn's beloved characters -- creatively brilliant and great managers of other peoples' brilliance -- are the very ones who hold no truck at all with randianism! Huh.
Above all, it is in their betrayal of the true libertarian forefather (and also called the "first liberal") -- Adam Smith -- that today's 'libertarians' demonstrate the ultimate hypocrisy. Which matters not a whit to those whose incantations march them (shouting hosannahs) back into chains of feudalism.
== They hate what works ==
Getting closer to the news…. Hey. If it is so awful, why not let Obamacare run its course?
Economist Paul Krugman at his most cogent: "In a way, you can see why the food stamp program — or, to use its proper name, the Supplemental Nutritional Assistance Program (SNAP) — has become a target. Conservatives are deeply committed to the view that the size of government has exploded under President Obama but face the awkward fact that public employment is down sharply, while overall spending has been falling fast as a share of G.D.P.
(News flash, the latest figures show that the US federal deficit has plunged below 680 billion or 4.2% of GDP, well below the 5% threshold that most economists call "safe." Look at the Second Derivative of deficits. The second derivative is ALWAYS positive during Republican administrations and almost always negative in democratic ones. That single fact -- all by itself -- should make any non-hypocrite deficit hawk or person obsessed with fiscal responsibility a democrat. Period. Flat and absolute. But let's get back to Krugman.)
"SNAP, however, really has grown a lot, with enrollment rising from 26 million Americans in 2007 to almost 48 million now. Conservatives look at this and see what, to their great disappointment, they can’t find elsewhere in the data: runaway, explosive growth in a government program. The rest of us, however, see a safety-net program doing exactly what it’s supposed to do: help more people in a time of widespread economic distress.
"The recent growth of SNAP has indeed been unusual, but then so have the times, in the worst possible way. The Great Recession of 2007-9 was the worst slump since the Great Depression, and the recovery that followed has been very weak…."
Read the rest. But above all recall that the core GOP narrative -- that there has been expanding overall federal government under Obama -- is a lie that is diametrically opposite to true, as the cutting of food assistance is diametrically opposite to moral.
That whirring sound? Barry Goldwater wailing and spinning over what has happened to conservatism. Poor Barry. How I miss him.
== Political Ammo! ==
Okay, my periodic political rant is nearly over. But let's begin our coda with someone who doesn't deserve a lot of respect, but who in this case makes a lot of sense:
Bruce Bartlett, author of The Benefit and the Burden: Tax Reform – Why We Need It and What It Will Take, held senior policy roles in the Reagan and George H.W. Bush administrations and also served on the staffs of Representatives Jack Kemp as well as Ron Paul. So his conservative credentials are complete. And yet, in this article in The New York Times, Bartlett assays the lunatic fringe of the GOP that is now spreading the toxic meme that we should default on the debt as a GOOD thing !
What would drive a right winger like Bartlett to say such things? Michael Goldfarb in SALON appraises the roots of the Tea Party's radicalism in events of 1973… that a four-decade-long war on the press’s legitimacy began with conservative anger over the "lynching" of Richard M. Nixon from the presidency. The idea that it was a biased liberal press that made the molehill of Watergate into a mountain of Constitutional crisis took root:
"Under Reagan, Republican appointees on the FCC abolished the fairness doctrine, the obligation for broadcasters to air both sides of controversial issues. This led to an explosion of opinionated propagandists on the airwaves relentlessly attacking “liberal” media. It continues to this day, degrading American public discourse.
"A Nixon media operative, Roger Ailes, discussed starting a Republican-slanted news program with the president pre-Watergate. Later, Ailes invented Fox News for Rupert Murdoch. Fox is one of the prime shapers of the hyper-partisan political culture that has made the U.S. practically ungovernable."
I found Goldfarb's insights interesting. Though ultimately, he is wrong. The roots lie in the Antebellum or pre-Civil War South. In the romanticism of Sir Walter Scott that Mark Twain denounced in his own people. In a resentment that simmers like hot, kudzu-scented evenings. We are still mired in a Civil War that is once more coming to a boil.
This has never, ever been about "left versus right." Karl Marx was long ago disproved and competition is to deeply woven into the sinew of all Americans for that ever to be the issue.
No… it's the future, all right.
= Rabbi Explains Why Both Left and Right are wrong. But Smith was right! =
And finally as promised, a palate cleaner, a little talmudic study from Lord Jonathan Sacks, Chief Rabbi of the UK...
"The rabbis favored markets and competition because they generate wealth, lower prices, increased choice, reduced absolute levels of poverty, and extend humanity’s control over the environment, narrowing the extent to which we are the passive victims of circumstance and fate. Competition releases energy and creativity and serves the general good.
"... However as the critics of capitalism pointed out, the market does not create a stable equilibrium. It engages in creative destruction, or as Daniel Bell put it, capitalism contains cultural contradictions. It tends to erode the moral foundations on which it was built. Specifically, as is manifest clear in contemporary Europe, it erodes the Judeo- Christian ethic that gave birth to it in the first place.
"Instead of seeing the system as Adam Smith did, as a means of directing self- interest to the common good, it can become a means of empowering self-interest to the detriment of the common good. Instead of the market being framed by moral principles, it comes to substitute for moral principle. If you can buy it, negotiate it, earn it and afford it, then you are entitled to it – as the advertisers say – because you’re worth it. The market ceases to be merely a system and becomes an ideology in its own right.
"Fourth, no one who reads the Bible with its provisions for the remission of debts every seventh year could fail to understand how morally concerned it is to prevent the build up of indebtedness, of mortgaging freedom tomorrow for the sake of liberty today. The unprecedented levels of private and public debt in the West should have sent warning signals long ago that such a state of affairs was unsustainable in the long run. The Victorians knew what we have forgotten, that spending beyond your means is morally hazardous, however attractive it may be, and the system should not encourage it."
Heh. I honestly wrote all of that stuff at the top of this column before reading this rabbinical teaching... which conveys almost the identical message, but with more eloquent persuasiveness. Maybe I should have studied for another profession.
============Adam Smith Quotations! ==========
These might shock both leftists and rightists. But liberals may wake up to rediscover the founder of their movement:
Our merchants and master-manufacturers complain much of the bad effects of high wages in raising the price, and thereby lessening the sale of their goods both at home and abroad. They say nothing concerning the bad effects of high profits. They are silent with regard to the pernicious effects of their own gains. They complain only of those of other people.
Chapter IX, p. 117
People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices. It is impossible indeed to prevent such meetings, by any law which either could be executed, or would be consistent with liberty or justice. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies; much less to render them necessary.
Chapter X, Part II, p. 152
Whenever the legislature attempts to regulate the differences between masters and their workmen, its counsellors are always the masters. When the regulation, therefore, is in favor of the workmen, it is always just and equitable; but it is sometimes otherwise when in favor of the masters.
Chapter x, Part II, p. 168
The interest of the dealers, however, in any particular branch of trade or manufactures, is always in some respects different from, and even opposite to, that of the public. To widen the market and to narrow the competition, is always the interest of the dealers.
Chapter XI, Part III, Conclusion of the Chapter, p. 292
The proposal of any new law or regulation of commerce which comes from this order, ought always to be listened to with great precaution, and ought never to be adopted till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it."
Chapter XI, Part III, Conclusion of the Chapter, p. 292
It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
Chapter II, Part II, Article I, p. 911
Every tax, however, is to the person who pays it a badge, not of slavery but of liberty. It denotes that he is a subject to government, indeed, but that, as he has some property, he cannot himself be the property of a master.
Chapter II, Part II, p. 927
These might shock both leftists and rightists. But liberals may wake up to rediscover the founder of their movement:
Our merchants and master-manufacturers complain much of the bad effects of high wages in raising the price, and thereby lessening the sale of their goods both at home and abroad. They say nothing concerning the bad effects of high profits. They are silent with regard to the pernicious effects of their own gains. They complain only of those of other people.
Chapter IX, p. 117
People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices. It is impossible indeed to prevent such meetings, by any law which either could be executed, or would be consistent with liberty or justice. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies; much less to render them necessary.
Chapter X, Part II, p. 152
Whenever the legislature attempts to regulate the differences between masters and their workmen, its counsellors are always the masters. When the regulation, therefore, is in favor of the workmen, it is always just and equitable; but it is sometimes otherwise when in favor of the masters.
Chapter x, Part II, p. 168
The interest of the dealers, however, in any particular branch of trade or manufactures, is always in some respects different from, and even opposite to, that of the public. To widen the market and to narrow the competition, is always the interest of the dealers.
Chapter XI, Part III, Conclusion of the Chapter, p. 292
The proposal of any new law or regulation of commerce which comes from this order, ought always to be listened to with great precaution, and ought never to be adopted till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it."
Chapter XI, Part III, Conclusion of the Chapter, p. 292
It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
Chapter II, Part II, Article I, p. 911
Every tax, however, is to the person who pays it a badge, not of slavery but of liberty. It denotes that he is a subject to government, indeed, but that, as he has some property, he cannot himself be the property of a master.
Chapter II, Part II, p. 927
Book III of Wealth Of Nations, chapter IV, see this amazing passage:
“But what all the violence of the feudal institutions could never have effected, the silent and insensible operation of foreign commerce and manufactures gradually brought about. These gradually furnished the great proprietors with something for which they could exchange the whole surplus produce of their lands, and which they could consume themselves without sharing it either with tenants or retainers.
"All for ourselves and nothing for other people, seems, in every age of the world, to have been the vile maxim of the masters of mankind. As soon, therefore, as they could find a method of consuming the whole value of their rents themselves, they had no disposition to share them with any other persons.
" For a pair of diamond buckles, perhaps, or for something as frivolous and useless, they exchanged the maintenance, or what is the same thing, the price of the maintenance of a thousand men for a year, and with it the whole weight and authority which it could give them. The buckles, however, were to be all their own, and no other human creature was to have any share of them; whereas in the more ancient method of expence they must have shared with at least a thousand people. With the judges that were to determine the preference this difference was perfectly decisive; and thus, for the gratification of the most childish, the meanest, and the most sordid of all vanities, they gradually bartered their whole power and authority.” [WN III.iv.10. p 418]
A GOOD SOURCE FOR ALL THINGS ADAMSMITHIAN -
http://adamsmithslostlegacy.blogspot.com/search/label/Vile%20Maxim
MANY QUOTATIONS: http://www.econlib.org/library/Smith/smWN21.html
SPREAD THE WORD! LIBERALS, ADOPT YOUR FOUNDER… AND SEE HOW FANATICS OF BOTH THE FAR LEFT AND THE ENTIRE RIGHT SQUIRM!
