Tuesday, February 20, 2007

In the Left Corner We Have a Rusty Idol from Calgary

Canada provides some great personalities who are worth reading as bloggers. It’s as if the people over there exaggerate the extremes of opinion to get recognised as individuals amidst the noise from their excessively noisy neighbours to the south, but no matter how much they try, they still come across (to me) as moody teenagers at a party, out to shock the uncool.

Take one such, Cliff Almas Hesby, from Calgary, Alberta, the author of the ‘Rusty Idols’ Blog, with his ‘look-at-me’ Tee-shirt slogan: ‘I am a trade barrier’ (“tee-hee, that will shock them - now how I can work in the F-word, to really upset their grandparents”), who writes a piece on Adam Smith, which shows he has not quite understood what Smith was about.

Cliff writes (and he writes well):

Free Market ideologues love Adam Smith and his magnum opus Wealth of Nations - except for the bits that they don't.

Under capitalism the more money you have, the easier it is to make money, and the less money you have, the harder.

Wherever there is great property there is great inequality. The affluence of the rich supposes the indigence of the many

[Get Cliff’s idea? Society is zero-sum; capitalism has turned the planet into the mills and factories of the mid-19th century, just as Marx and Engels told us; go to Calgary and see the dank slums, the smoke stacked hellholes where the Canadian lumpen proletariat shuffle to work in their cars, their clothes made from rags, their breakfasts made from the offal thrown out by the rich, bloated capitalists living, er, next door, their deformed 6-foot tall, skinny emaciated bodies – no fear of obesity here, crippled with disease and no medical services, the nearest hospital, a dirty shed, six floors high, with ignorant, uneducated nurses and people laughingly called ‘doctors’, killing everybody the germs don’t get to first, (Editor: that’s enough make-believe): no mark]

Smith's metaphor of the Invisible Hand is often used to justify policies of Laissez-faire absolutism, of course this is taking a very specific quote out of a very specific context of Smith's belief that national level disruptions caused by globalized trade would be restricted by specifically nationalist sympathies. Essentially, exactly the kind of thinking dismissed by globalization's current high priests as narrow and parochial.”

[At this moment he is partly quoting what others say about Adam Smith, so no point complaining: for ‘invisible hand as a metaphor’(1 mark); for ‘laissez faire absolutism’ (not a word that Smith ever used: no mark); ‘specific quote out of context’ (1 mark); ‘globalised trade’ (not a word Smith used and not appropriate in mid-18th century - international trade even with the American colonies was unimportant; Hawaii was unknown, Australia was unsettled: half mark); ‘specifically nationalist sympathies’ (no; it was simple human risk aversion to trade outside a locality and overseas – piracy, wind and waves, fraud, shipwrecks: no mark); ‘globalisation’s current high priests’ (colourful language to shock the adults: no mark)]

“Another example of the way Smith's modern followers display their very selective reading of Smith is on the subject of inheritance. Smith very strongly supported restricting inheritance, believing that beyond insuring the basic needs of widows and children it was something that distorted the equality of opportunity he believed in, creating an aristocracy of wealth. Amusingly the Adam Smith Institute now argues against the teachings of their name-sake on this and many other issues.”

[Smith’s concerns about inheritance were not directed at the overwhelming majority of Britain’s population – the labourers, artisans and their families – but at the landowners whose inheritances consisted of primogeniture rights and entails – land blocked by legal means from being broken-up and sold piecemeal; it had to be intact, as a whole, and passed to the nearest male relative, thus locking land distribution into a small coterie of rich families.

It is disingenuous to extend that to the situation today where the vast majority of Britain’s population live in families that have modest amounts of inheritance entitlements – the family home, mainly, of which the Inland Revenue takes 40 per cent, forcing the house to be sold; Smith did not believe in ‘equality’ in the sense Cliff suggests, - more like the right to a proper share in the opulence created by living in a regime of Perfect Liberty, which allowed for differences in lifetime earnings from labour; the Adam Smith Institute can look after themselves, so I offer no comments; overall score: nil.]

“Smith would probably been just as appalled by the bloated pay of CEOs and other executives and the growing canyon between the rich and poor. He would probably have supported efforts to narrow such gaps and would have sympathized with the argument that such gaps lead a dangerous class resentment and social instability. Even Bush has taken notice the dangers of such drastic transfers of wealth from the many to the few, which was the central point of his presidency of course.”

[I take the point, but it is not possible to say what Smith would have thought of these events. He did not anticipate the future, nor write about it; he did not know the word ‘capitalist’ – it was invented in 1854 and Smith died in 1790; he knew nothing of capitalism, a mid-19th century phenomenon. He certainly was concerned that if the bulk of the people – the labourers and their families – were unhappy and poor, it was ‘dangerous’ for stability, hence he approved of high wages, employment, education and freedom. The workers today are well educated, are not starving and living in hovels (I’ve been to Calgary on business and it does not look much different from Edinburgh in opulence, except everything is bigger in Calgary, but its older in Edinburgh) and they own the most amazing range of gadgetry beyond what Smith could have imagined: half mark]

“We tried it the Laissez-faire fetishists way for the last several years. The result has been an unstable mess of privilege and imbalance that threatens to upend the whole system. Time to accept that Smith's ideas always included a context of regulation and adjustment. Smith, the real Smith isn't inconsistent with regulation and adjustment - or even socialism, believers in transparent appendages to the contrary.”

[Laissez-faire is an abstract idea, never been tried nor tested, and certainly not in the ‘last several years’, and would not be a solution – Smith didn’t believe it would be either; he didn’t trust ‘merchants and manufacturers’ that much: no mark; if Cliff thinks Canada, or Calgary is on the eve of ‘revolution’, he cannot be serious, apologies to McEnroe: no mark; ‘Smith’s ideas included a context of regulation and adjustment’ – yes, but he didn’t trust politicians much either and preferred the rule of law, separation of powers and independent justice: half mark; ‘isn’t inconsistent with regulation and adjustment’ – yes: 1 mark; ‘even socialism’ – NO! Nonsense and wishful thinking, a step or more too far in Cliff’s argument, aimed at provoking adults, .. er, so I’ll calm down, with my ‘transparent appendages, whatever they are: no mark]

‘And if they are right, they are in effect arguing that fairness is impossible without radical revolutionary change.’

Well as maybe, but they ain’t right. And if ‘radical revolutionary change; is what Cliff wants, that is his free choice. In Calgary, they have democracy. If Cliff can get elected – his profile says he was a candidate for office for ‘NDP’ (of which I know nothing). All countries that have tried ‘radical revolutionary change’ have not been, even notionally, successful, except in swapping one elite for another, and making a whole lot of people, especially the average labourer and his or her family, a whole lot worse off, while they did so, and afterwards until the people returned to freedom and the rule of law.

Markets don’t promise you a rose garden, but they do quite nicely in not making you live in a man-made desert. Compare market driven Hong Kong and Mao suit, state-driven Canton before China’s steps towards liberalisation.

Overall, Cliff’s essay did not do well for content. For writing style it did much better. On Adam Smith’s thinking, he is moving away from Chicago’s version of Adam Smith, but he has some way to go to get to the heart of the Adam Smith who lived in Kirkcaldy.

[Read Cliff’s article at: http://rustyidols.blogspot.com/2007/02/inheritance-adam-smith-and-anna-nicole.html]


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