Monday, June 25, 2007

How Not to Fight Ignorance With Mythical Illusions

Dan Roberts, Business Editor, Sunday Telegraph, was bewailing the sloppy PR of the private equity sector that is ruffling the feathers of the Old Left in Labour, the bruiser corporate trade union giants and some Glastonbury music fans(?).

He writes under the heading: ‘These masters don't understand their universe’, and gives them advice about how they might handle more effectively the noise from the aforementioned people. On the advice he gives, I have little to say (the are well enough off, apparently, not to need my scribblings on how they might improve their act from me).

I did spot the tail-end paragraph that drags in Adam Smith on the usual misrepresented grounds:

Perhaps it was too much to expect an “Adam Smith-style treatise on the invisible hand. In the face of such overwhelming confusion over the detail, perhaps they decided it would be folly to start arguing about the big picture. But no matter how teeth-grindingly annoying it is, the private equity industry has to start engaging with its critics rather than swatting them off.”

If ‘an Adam Smith-style treatise on the invisible hand” is the supposed remedy in PR terms, or even just one that is considered to be rejected for something in its place, I hold out little hope for the private equity PR effort to do more that make things worse for them.

I have absolutely no idea what an “Adam Smith-style treatise on the invisible hand” would read like. It certainly wouldn’t be a very long one, perhaps a sentence. It wasn’t longer in its original version by Adam Smith, where it was a mere metaphor for risk aversion among a group of merchants unwilling to risk their capital in foreign trade, which is not exactly what private equity funds do today.

What Smith’s use of a well-known metaphor (well known in the mid-18th century from the use of the metaphor in literature before his casual employment of it in a context that other nothing to do with markets) would do for the PR activities of private equity funds would be a wonder to behold.

I would have thought (my initial 2 cents/pennies' worth) that a PR campaign centring on a metaphor with allusions to a mystical, diembodied, non-existent entity would hardly be a bright response to the illusions of their PR targets. But there you go; what do I know.

Any reqader who would like to see my paper: “Adam Smith’s Invisible Hand: from metaphor to myth” (presented at the History of Economics Society’s 34th Annual Conference, June 2007, George Mason University) should email me: gavin At negweb{Dot]com and I shall send an electronic copy.


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