Tuesday, April 15, 2008

Not in Adam Smith's Name

Seeking Alpha posts The Economy and Free Money: Too Late to Play it Straight? by Craig Jones (here):

Though we long ago took the fork in the road that veered away from Adam Smith’s invisible hand, one would hope that, as a democratic and ostensibly freedom loving society, we would endeavor to hold on to some basic tenets of a laissez-faire economic model. As in most election cycles, this year’s cadre of candidates, especially the Democrats, are promoting ideas to “fix” our economy that would make even Lord Keynes roll over in his grave.”

Comment
Craig Jones is off the pace in “the fork in the road that veered away from Adam Smith’s invisible hand” and in wanting to holding on “to some basic tenets of a laissez-faire economic model”.

Neither idea had much to do with Adam Smith. The ‘invisible hand’ was a metaphor for the consequences of risk avoidance – it didn’t exist otherwise and he never mentioned ‘laissez-faire’, not even once, which was one fewer times than he used the famous metaphor, which wasn’t about markets anyway.

Craig is long on clichés (‘Lord Keynes roll[ing] over in his grave’ and short on appreciating Adam Smith’s actual ideas about political economy.

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