QUICK BITS no 14
TBN posts (9June) on Business News (originally on The Atlantic) HERE
The Drawback With Inequality, Based on Adam Smith
“In making his case Obama appealed to the authority of a seemingly unlikely ally: Adam Smith, the purported founding father of laissez-faire capitalism, who’s broadly thought to have advocated unbridled greed and selfishness within the identify of permitting the invisible hand of the market to work its magic.
Many a scholar has made a profession, in latest many years, by declaring that this view of Smith is a gross caricature. It has typically been famous, as an illustration, that Smith by no means as soon as used the time period “laissez-faire” and even the time period “capitalism,” and that his two books—The Principle of Ethical Sentiments (1759) and The Wealth of Nations (1776)—are filled with passages lamenting the potential ethical, social, and political ills of what he known as “business society.”
I have noticed an interesting and welcome trend on the NET that alludes to the critique by Lost Legacy and others tthat identifies the usual guff by many modern economists about Adam Smith.
Economists, post-Samuelson, 1948, go on about Adam Smith’s so-called belief that ‘greed was good’ (as portrayed by Hollywood’s script writers and by Ayn Rand) or that Adam Smith advocated ‘laissez-faire’, words he never used, despite claims by 19th-century campaigners on behalf of Factory Millowners for themselves, not their employees. As for his alleged meaning when he used the metaphor of “an invisible hand’, a glance at my Loony Tunes feature shows how riddiculous that made those up claims by economists, followed by the general meda, is in fact.
I have been (mostly) politely correcting others who keep talking about Smith’s alleged ‘invention’ and use of the word ‘capitalism’ - a word first used in English in 1854 (Smith died in 1790). I am glad to see that more commentators are slowly getting their facts right about Adam Smith.