Tuesday, November 04, 2014


Paul B. Farrell posts (31 October) on Market Watch HERE 
He writes: 
1. Adam Smith’s moral capitalism guided by the Invisible Hand of God
“ … Capitalism is guided by an Invisible Hand that Adam Smith refers to in his classics as the “Deity,” “Providence,” the “Author of Nature,” and “God” roughly a hundred times using references common in the 18th century, language clearly confirming that Smith was referencing the “Invisible Hand” of God as the power driving the new capitalism.” …
…2. Ayn Rand, free-market capitalist, atheist, narcissist
“… Candidate No. 2 is Ayn Rand, atheist and also patron saint of what Jack Bogle calls “mutant capitalism” in his “Battle for the Soul Of Capitalism.” Today, Rand’s mutant capitalism is the core belief system guiding the psychological behavior of Republicans, the Big Oil sector, social conservatives, energy billionaires like Koch Bros, Wall Street bank CEOs, and climate-science deniers. …
“…The only one real election is the one between the only two real candidates that count. They will determine the balance of power, Adam Smith vs Ayn Rand with two totally opposite versions of capitalism, one moral, the other godless. This is the only election that matters this century. These are the only two candidates. They control the fate of America.
I referred to Paul B. Farrell’s 31 October post a few days ago when discussing Halloween, but l leapt over his ideas about Adam Smith and religion.
Adam Smith had won a Snell Exhibition (scholarship) to Oxford University in 1740 and on graduation promised to join the established Calvinist Church of England as a priest, and serve in Scotland within the Episcopalian (Church of England) confession.
In the event, Smith changed his mind and withdrew from the academic route to ordination in 1744, by switching his studies to Jurisprudence. In 1746 he left Oxford and travelled home to his mother’s house in Kirkcaldy to seek employment as a tutor. 
Clues to his loss of faith are revealed in an essay he composed from 1744 on ‘The History of Astronomy’ (published posthumously on his instructions in 1795). This cannot be conceived as a theological treatise. Its account of the long process of theological fantasies under pagan influence and superstition to the realisation through science of the Earth’s place in the Universe, suggests its personal sugnificance in his decision to switch careers at Oxford.  It also contains his first refrence to  the  “invisible-hand” metaphor, specifically identified as the “invisible hand of Jupiter”, the main pagan god, who was believed by the credulous to fire thunderbolts (visible lightning!) at dissaffected citizens in the Roman Empire.  How Paul B. Farrell fits this allusion into Christianity could be revealing.
The 6th and final edition of Adam Smith’s ‘Theory of Moral Sentiments’ published in January 1790, just months before he died in July 1790, is certainly revealing because if he was a Christian believer it was a strange testiment for someone who believed, acccording to Paul B. Farrell, that he was about to meet his maker.  Consider the manner in which Smith edited out many of the last edition's removal or modified its thelogical phraseology in the first 5 editions of Moral Sentiments. 
I have discussed these changes and their implications in my paper: “The Hidden Adam Smith in his Alleged Theology”, ‘Journal of the History of Economic Thought’, 2011. Vol. 33, No. 3, pp. 1-18. This was my reply to Lisa Hill’s, “Hill, L. 2002. ‘‘The Hidden Theology of Adam Smith.’’ European Journal of the History of Economic Thought 8 (1):1–29.) 
A longer version of my ideas was published in Chris Berry, Maria Paganelli, and Chris Smith, eds. 2013. ‘The Oxford Handbook of Adam Smith’, Oxford University Press: ‘Adam Smith on Religion’. Part VI, pp. 464-84.
Paul B. Farrell, safely esconsed in the 21st century democratic USA seems not to appreciate the extent to which competing religions dominated all discourse in the late-18th century and the extent to which critics of these prevailing orthodoxes had to compose their books to avoid reprisals for challenging them. Smith was no exception when writing his books. 
Even on its own merits, Farrell’s assertions do not confirm his premiss.  Smith did not link the ‘invisible hand’ to “God as the power driving the new capitalism”. Smith never mentioned ‘capitalism’, a word that was first used in English in Thackery’s novel, ‘The Newcomes’ in 1854. Smith discussed ‘markets’ that had been operating in classical Greece and Rome and Europe (5th century BCE). He did not even mention what we know today as the ‘industrial revolution’. He discussed the pros and cons of the conduct of ‘merchants and manufacturers’ (overall he did not think much of their behaviour).
Moreover, his use of the ‘invisible hand’ metaphor was covered in purely secular terms, and never as the ‘hand of God’.  In his use the ‘invisible hand’ was a metaphor for the motives of ‘proud’ landlords who exchanged food from their fields for their labourers (serfs, slaves, or whatever) who laboured to produce it.  The landlords greatness and power rested upon the labourers who were compelled to work his fields. The labourers worked the fields in exchange for food resources and shelter.
However, beyond the intended consequence of their exchange (food for labour/labour for food) there was also an unintended long-term consequence of agriculture in the form of the ‘propagation of the species’.  Population in agriculture continued to grow with increasing production that promoted wider exchanges and economic (unequal) benefits.  Hence, Smith’s comments on the higher standards of living for all participants in agriculture compared to those confined to hunting and gathering in the forest.
On Ayn Rand there is no comparison with Adam Smith with her lack of belief in religion and her beliefs in selfishness as a virtue in ‘capitalism’.  Smith was associated with the philosophy of Natural Liberty - for all, not just employers and politicans - and he was not religious in so far as ‘revealed’ religion was concerned. 

Whatever Paul B. Farrell’s complaints about “mutant capitalism [as] the core belief system guiding the psychological behavior of Republicans, the Big Oil sector, social conservatives, energy billionaires like Koch Bros, Wall Street bank CEOs, and climate-science deniers” it sounds very much like ideological ‘politics’ of which Adam Smith did not express views. Given Smith’s critique of Bernard Mandeville, I am pretty certain he would have had nothing positive to say about Ayn Rand’s ideology. 


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