Wednesday, May 09, 2007

It All Started With 'Good Queen Bess' and 'The Honourable Company'

Contemporary debates on economics focus on ideas as if they are eternal verities, when in fact a moment's thought inform us of the obvious: ideas replace older ideas through successive mutations until the ideas of today of the same phenomena are absolutely of no resemblance to what they were a while ago.

Commerce is no exception; in fact it is a prime example. Way back, the idea of commerce itself was anethama in discourse. The long interregnum between the fall of Rome and the re-emergence of commerce a millennia later left social guideposts to appropriate behaviour adrift. A long, slow process of acceptance of what we call modern ideas took centuries to take root. Smith's Wealth of Nations was part of that process, but thousands of others also took part (Yale holds several thousand pamphlets from the post-1600-1800 period in its library).

Somebody called ‘Buce’ (‘you wait here in the lobby, I’ll bring the etchings down’), from or in Palookville, (American slang for a place where ‘imperfect’ humans come from; a failed concert venue in Santa Cruz, California, etc.: Wikipedia), in his Blog: Underbelly(a journal of soft information) has realised there was a different world set of ideas back four centuries and it appears to have incited him to think some more about it. Read it here:

“Riffing on Empire”

“I spent most of yesterday with John Keay’s The Honorable Company: A History of the East India Company (link). It’s chatty and entertaining, although I could have used a bit more depth and focus. Still, there are some takeaway point[s]. Herewith some thoughts on the nature of commerce and the development of sovereignty

Yes, John Keay’s account of the East India Company (‘The Honourable Company”) is a good read on a long-haul flight; I recommend it if you have no time for deeper study (though be aware, there is rather a lot to read beyond John Keay’s book).

Buce’ also hits, perceptively, a rich vein of intellectual interest in the second paragraph I quote:

It’s really hard for one—me—to put his mind into a time back before Adam Smith, before Thomas Hobbes, when current notions of commerce and sovereignty were still struggling to be born. It’s not easy to imagine a world where it seems that most of the noisy people believed that in every trade, one gains and another loses, and that if the English were shipping out goods for sale, then it must be that someone was taking advantage of them.”

Yes, the 16th-17th centuries were most interesting if you want to grasp fully the magnitude of Adam Smith’s contribution to thinking about what causes the wealth of nations. The disparate literature, mainly in pamphlets, that wrestled with questions about commerce, its morality and ethics, and its future from the time, show a complete cleavage between the post-medieval ideas, mainly hostile, about avarice, ‘love of money’, and ‘godliness’, and the Hume-Smithian ideas about mediated self-interest, self-betterment, and liberty.

The most authoritative (and incidentally, eminently readable) account of these debates is Istvan Hont’s Jealousy of Trade: international competition and the nation-state in historical perspective’ (Harvard University Press, Mass. 2005).

I have just revised my own chapter on the subject for my new book on Adam Smith (for Palgrave’s Great Thinkers in Economics series, 2008) and agree that there was an immense sea-change in the triumph of the Enlightenment ideas over the medieval ideas, though what accompanied the change-over in national wars, both bloody and economic, which Smith labeled ‘the false doctrines of mercantile political economy’, was a heavy price to pay for many millions of people.

Unfortunately, the resurgence of mercantile political economy (did it ever go away?) threatens to continue its damaging ‘beggar my neighbour’ paranoia, much of it from people who consider themselves to be ‘liberal’ minded.

But a great place to start understanding the present is to understand the past, and you cannot do better than start from 31 December 1600, the day that Elizabeth I awarded her Royal Charter to the ‘Company’.


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