Think, Don't 'Occupy'

Mike Valente, an assistant professor at the Richard Ivey School of Business, writes HERE: :

“Why Business Schools Should Join "Occupy Wall/Bay Street"

“First, the last decade has proven unequivocally that Adam Smith’s original supposition that the pursuit of commercial interests leads to optimal gains for society is misguided at best. An unprecedented number of circumstances have emerged where the pursuit of corporate interest has left society worse off. Smith’s ingenuity fit a time when business represented a relatively small actor in society shadowing the power of the church and the state.”

Comment
Mike Valente writes a controversial thesis, not just because he gets Adam Smith ‘original supposition’ wrong, not least because Smith did not write that ‘the pursuit of commercial interests leads to optimal gains for society’, but also because Mike Valente controversially asserts that ‘pursuit of corporate interest has left society worse off’.

One might ask where did Smith write about ‘optimal gains for society’ (an anachronistic-sounding’ claim often made in the 20th century by modern economists and by lobbyists, but not found in Wealth Of Nations), and we can also ask by what measures has corporate interest ‘often made society worse off’? ‘Worse off’ in comparison to where it could be? When was it 'better off'?

Smith was not a dreamer; he was a philosopher, who ‘observed everything’ and was noted for his pragmatic view of the world he lived in and its history since our predecessor left the forests. Smith did not think that changes came quickly, but he thought it could better off without mercantile political economy. He sought no utopias; he had no illusions about the political obstacles along the way, not least the crass corruptions across society as had evolved - and remained.

We do know that hundreds of thousands of individuals try hard to migrate into countries where corporate capitalist interests have been dominant for periods running from centuries (since Smith’s time) and since then more recently measured in multiples of decades (think China, India, and Brazil)

There is no evidence that individuals on any serious scales have tried hard to move in the opposite direction to escape being made ‘worse off’ by corporate interests, as represented by Wall Street or the City. Yes, behaviour among such circles has had calamitous consequences of potential danger, but the answer does not depend on 'occupations', messy riots, and vandalism. After they leave, their mess will be cleaned up and paid for by insurance and future customers. Tens of thousands of people from Central and South America risk their lives to get into North America (by one count recently I saw the figure of several millions of people made that journey since the 1980s across the inhospitable deserts of Arizona and through its socially inhospitable towns too) to get a taste of being ‘worse off’ in the USA. They are doing what the now settled waves of earlier emigrants from around the world, who got there before them, including, I suspect, as experienced by Mike Valente’s forebears. His social class are usually described today as ‘middle class’, who are definitely better off by hundreds of percent than their $3 a day forebears.

Compared to the $3-a-day predecessors of the likes of Dr. Mike Valente in pre-capitalist Europe, and to the poverty of 18th-century Scotland, the achievements of the market economies are a magnet for the world’s truly poor.

Mike’s predisposition for Business Schools to ‘occupy Wall Street’ is mindless activism. I suggest he reads Adam Smith’s works (that is, the moral philosopher born in Kirkcaldy in 1723, and not the cartoon Adam Smith invented in Chicago in the 1920s). He should also contemplate a bit of history, such as Deirdre McCloskey’s ‘Bourgeois Dignity’ too, and give himself some historical perspective of what it really means to be worse off, and, perhaps, what requires to be done to make it better.