Wednesday, February 22, 2006

Before Repeating Flippant Remarks about Economics, Check your Sources (try Google!)

In (
Kenneth G. Elzinga reviews Benjamin F. Friedman's
The Moral Consequences of Economic Growth.

The first thread in Friedman's analysis is the conventional wisdom in economics. This idea goes back to Adam Smith: the wealth of a nation consists of its goods and services, not its gold. Today, an economics teacher might simply state what seems obvious (at least to economists): expanding a consumer's choice set necessarily makes the consumer better off (or at least no worse off, since the consumer can always choose the original choice set).

Today the conventional wisdom is often criticized. At one time, those opposed to what Adam Smith called the "obvious and simple system of natural liberty" faulted the market system for producing too little. That was the old-fashioned case against capitalism. Today, anti-growth environmentalists and small-is-beautiful advocates fault the market system for producing too many goods and services. Once scarcity was bad. Now abundance is. Once the market system provided too few choices; now it produces too many.

More than a century earlier, Carlyle wrote with distaste about the "cash nexus" that connected people in a market economy.

As I read Friedman's book, I wondered how many of my colleagues in the dismal science could differentiate between premillenialism and postmillenialism.”

In a review written by a self-proclaimed Christian in a Christian newspaper, should I be surprised that casual reference is made to Thomas Carlyle and his now famous, but obscure in its origins, quip about economists and the ‘dismal science’?

Most people since who repeat Carlyle’s quip, believing that he called political economy dismal because of the alleged dismal pessimism of Robert Malthus, and sometimes because of the alleged cold lack of compassion of Adam Smith.

For a recent corrective exposition of the non-pessimistic views of Malthus, see Sandra Peart’s Blog, Adam Smith Lives! (listed among the Blogs we recommend in the left column). For the alleged cold lack of compassion of Adam Smith, read abundant evidence to the contrary in Adam Smith’s Theory of Moral Sentiments (1759).

For an accurate account of why Thomas Carlyle was describing economics as the dismal science see: and also:

Carlyle was not writing about ‘dismal’ political economy. He wrote a pamphlet entitled: Carlyle, T. (1849), Occasional Discourse on the Negro Question, Fraser's Magazine, 40 (December): 670-9. Reprinted in Collected Works of Thomas Carlyle, Volume 11, 171-210.

Caryle's disgraceful outburst also appeared as pamphlet in 1853 in London with the ‘the Negro Question’ changed maliciously to ‘the Nigger Question’. In it Carlyle refers to Caribbean black slaves as ‘two-legged cattle’ and defends slavery by the white plantation owners. He considered political economy ‘dismal’ because John Stuart Mill considered slavery was wrong and that blacks and white were of the same race, the human race, and that they should be freed. So much for a much-lauded English Man of Letters.

Of course, Benjamin Friedman was not a party to any of Carlyle's racist nonsense and his book, The Moral Consequences of Economic Growth, is well worth reading.

Perhaps Kenneth G. Elzinga might wish to reflect on his flippancy about the dismal science of political economy?


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