Monday, December 19, 2005

Neither Smith nor Marx 'Paved the Way for Globalisation"

Dr. Ralph Lynn, a member of the Board of Contributors, Central Texans who write columns regularly for the Tribune-Herald and a retired professor of history at Baylor University writing in repeats the well worn distortion of a now famous saying:

“The “good old boys” running this show are not bad people. They are just making the mistake made by “Engine Charley,” the genial General Motors chairman of 40 years ago. He assumed that what is “good for General Motors is also good for the country.”

What Charles Erwin Wilson, CEO of General Motors, actually said is not quite what he is believed to have said in reply to a question from the
Senate Armed Services Committee, if as secretary of defense he could make a decision adverse to the interests of General Motors, Wilson answered affirmatively but added that he could not conceive of such a situation "because for years I thought what was good for the country was good for General Motors and vice versa", (The New Dictionary of Cultural Literacy, Third Edition. Edited by E.D. Hirsch, Jr., Joseph F. Kett, and James Trefil. Copyright © 2002 by Houghton Mifflin Company).

He was referring to an affinity of interests between the country (USA) and GM, which is not quite the same as arrogantly imposing on the USA whatever was good for GM.

Dr Lyn’s article has several ‘not quite’ right references to other matters, including the role of Adam Smith, opening with:

More than just a bit oddly, both Adam Smith, the patron saint of big business people, and Karl Marx, whom these businesses people detest, paved the way for globalization.
In the big-business, simplified view, Adam Smith exalted individual enterprise free from government controls

Adam Smith as the patron saint of ‘big business’? Not something that Smith was familiar with, except in the case of the East India Company whose appalling behaviour he condemned wholesomely in “Wealth of Nations”. Smith was not a friend, never mind a ‘patron saint’, of ‘big business, a phenomenon of which he had no knowledge and did not write about.

His vision of the future was that of a growing commercial society, soundly based on an improved, and improving, agriculture in Britain. Of the United States economy he envisaged that it would be the strongest in the world, having overtaken Britain, sometime around the 1880s (Wealth of Nations, IV.vii.c.79: page 625) and would (‘should’) be based on agriculture and not industry. How Smith ‘paved the way for globailisation’ is not explained.

That Karl Marx allegedly also ‘paved the way for globalisation’ appears to depend on a spurious association of a German philosopher scribbling away and the quite separate development of capitalism:

The Karl Marx contribution is a welcome surprise to the business people. This because Marx wrote little about socialism while discovering and praising the unequaled talents of big businesses in the production of goods and services.

Marx foresaw that the business people would reverse previous economic history: Instead of being controlled by governments, they would control the governments – all so successfully that an impressive recent study says that the entire world now shelters 587 billionaires.”

Smith, who did not foresee capitalism, and Marx, writing amidst its early manifestations, ‘foresaw’ business people controlling governments, somehow ‘paved the way’ for what happened two hundred years after Smith died and a hundred years after Marx died!

We can safely assert if neither Smith nor Marx had ever lived or written their books, capitalism would have appeared in almost exactly the same form it appeared anyway. Societies do not develop in a particular way because philosophers speculate about them. Smith, with characteristic modesty, said philosophers ‘do nothing but observe everything’, and Marx exhibited futile activism (and typical arrogance) in announcing that the task of philosophers was not to ‘understand but the change the world’.

“Wealth of Nations” was the result of observations of mid-18th-century Britain, looking backwards to the Europe of ancient Greece and Rome rather than forwards to the 19th century; “Capital” was an elaborate analysis of 19th-Century capitalism demonstrating that its author did not understand what he wanted to change.

Dr Lyn ends his piece to the theme of ‘greed’ (‘Systemic greed and inability to foresee unintended consequences’). He too is closer to wanting to change the world than to understanding it. I suggest, respectfully, that he read “Wealth of Nations” and “Moral Sentiments” if he wants to do the latter.

Read Dr Lyn’s piece at:


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