Saturday, May 21, 2016

ABSOLUTE NONSENSE ABOUT ADAM SMITH

In today’s news:
HERE  " Rejected petition to Parliament":
Petitioner: “Keep Adam Smith on the £20 note as he is the face of modern day Economics”.
As a student of economics, I have found out that if it wasn't for Adam Smith and his assumptions, all noted in his famous book the 'Wealth of Nations', everything we experience today wouldn't exist. It's all down to this one man. If anything, he deserves to continue serving the £20 note.
Economics is more than just a school or university subject. Not only is it regarded as a 'social science', it can also be classed as 'a way of life'. If it wasn't for Adam Smith, the technology we have today simply would be non-existent. "The invisible hand is a term used by Adam Smith to describe the unintended social benefits of individual actions" - Wikipedia. The way the free market can operate in the UK today is all thanks to that one man, Adam Smith.
COMMENT
Much as I would agree with the petitioner about the decision to drop Adam Smith from the face of the £20 note, the arguments put forward in support of this petition are absolutely, ignorant nonsense. (No, I am not exagerating!).
If it wasn't for Adam Smith, the technology we have today simply would be non-existent”.
Absolute Nonsense! The technology we have was invented/innovated by people independent of the fact that Adam Smith was born in 1723 and died in 1790.
"The invisible hand is a term used by Adam Smith to describe the unintended social benefits of individual actions" - Wikipedia.
More nonsense! Anyway Wikipedia is notoriously unreliable. For Adam Smith, the ‘invisible hand’ was a well known metaphor, used widely in the 17th and 18th centuries by theologians and local preachers in kirks (Scotland) and churches (England), for the ‘hand of God” and also regularly in novels, plays (Shakespeare) and even politics. The metaphor was NOT ‘coined’ by Adam Smith. Nor did he use it to describe “the unintended social benefits of individual actions”. 
It described how individual motivated actions could - not would! - have unintended consequences, which may be beneficial or detrimental to others. ‘Merchants and Manufacturers” were not always, nor even mainly, benign. They would be and often were intentionally malign in their actions, conspiring against the consumer’s interests.
The way the free market can operate in the UK today is all thanks to that one man, Adam Smith”
Beyond belief nonsense! The Petitioner is a fantasist! If Adam Smith had died young - he was a sickly child - the world would have continued along much the same tracks. The entrepreneurs who lived before, during and after Smith’s lifetime would have continued on the same innovative tracks, as would the existing politicians in governments (most of whom ignored Smith or never heard of him) in their Mercantile across Europe and North America (and elsewhere). The century in which he lived was peopled by many who had never heard of Adam Smith, nor opened his two books where he described the history (not the future!) of what was happening - as is still true today (including, apparently on the evidence of the Petition, the hapless Petitioner too!).
Most academics, let alone the general public, have not read his books (nor did they in the 18th-19th centuries. If they know of Adam Smith today they are more likely to be influenced by broad media sources which have picked up his use of a misattributed metaphor, the ‘invisible hand”, which was not mentioned by any of Smith’s colleagues while he was alive. Nor by all of later major political economists, who wrote many volumes discussing political economy in the 19th century, until a few (6) individuals in the 1870s, and after that practically nobody until the 1940s (Paul Samuelson - who quoted Smith incorrrectly).
One leading economist (and ‘expert’) admitted a year or so ago that he had bought Adam Smith’s Theory of Moral Sentiments (1759) and had left it unread on the bookshelf for 35 years! Meanwhile, the world kept going as it always does, doing what it did for several centuries before Adam Smith was alive and continued to do long after his death. 

Adam Smith described the world as he saw it. He did not invent it!

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