A Libertarian Theologian on Invisible Hands
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Franz Hinkelammert writes about “Humanism and Violence’ in
The original article published was published on the Institute for Theology and Politics website (6 December) is translated from the German at http://www.itpol.de/. Franz Hinkelammert is a liberation theologian living in Costa Rica and author of several books.
“This abstract humanism that is still the soul of the colonialization of the world today also marked the establishment of middle class society and capitalism. A true spirituality of the market arose. Mandeville declared private vices were public virtues. Adam Smith transformed this into the invisible hand of the market: evil was good. Evil, exploitation, is only seemingly evil. The invisible hand of the market changed it into a contribution to the general interest so it became the good. Neoclassical theory changed this into the assertion of an automatic tendency to the equilibrium of the market. Neoclassical theory exists in this form in today’s neoliberalism: evil is good whenever it happens in the scope of the market. Although this has been refuted a thousand times, the economists of this school simply look away and repeat their dogma. Without this dogma, capitalism could not be substantiated. Capitalism immunizes itself again and again. This can be read today in the autobiography of Greenspan: The Age of Turbulence. A real spirituality preserved Greenspan from falling back to concrete humanism.”
The disentangling of the errors in this piece would make an excellent test for first year students in a class on the history of economic thought (if there are any left!).
It has a touch of the ‘kettle and the pot’ calling each other names, about it in the sentence: ‘Although this has been refuted a thousand times’.
Adam Smith did not transform Bernard Mandeville’s ‘Private Vice, Public Benefits’ title into ‘invisible hands’ explanations. Mr Hinkelammert has made the transformation all by himself.
That is so ridiculous it can only be asserted if the modern school of economics misinterpretation of Adam Smith’s 18th century ideas is believed and the believers have never read Wealth Of Nations or Moral Sentiments.