Wednesday, September 23, 2015


PAS president Abdul Hadi Awang asks his political rivals: HERE
“If you can accept communism, why not Islam?”
Similarly, he said the people accepted BN, MCA and MIC which promotes capitalism, an ideology pioneered by the Englishman Adam Smith.”
From  an ambitious Asian politician seeking to govern his country he demonstrates his ignorance of history and  facts. 
The obvious response is to note that Adam Smith was never an “Englishman” - he was born in 1723 in Kirkcaldy, in Fife, a county in Scotland, making him a Scotsman. He occasionally lived in England but never long enough to be confused as an Englishman, spending most of his life in Scotland.
Moreover, Smith never “pioneered capitalism” - he never knew the word ‘capitalism, which was first used in English in William Thackeray in 1854 in his novel,The Newcomes, issued in weekly parts from 1853-55. 
The Oxford English Dictionary, considered an authority on the English language, credits William Makepeace Thackeray for the first published use of the word ‘capitalism’ in his novel, “The Newcomes” (1853-55), though it is clear from its context that this refers to finance capital, rather than to a ‘system’. Financiers in 19th century novels tended to get a bad press; see also Trollope’s ‘The Way We Live Now’. 
Archival Note:
From “Lost Legacy”, 9 February, 2007:

“The origin of the word ‘capitalist’ is of much earlier vintage: in French, A. R. J. Turgot (1727-1781) used ‘capitaliste’ in his essay, ‘Reflection on the Formation and Distribution of Wealth’ (1769-1770), and William Godwin used its English version, ‘capitalist’, in his Political Justice (1794).”


Blogger Unknown said...

I think the current definition of capitalist is different from Turgot's definition, since he defines it as a property owner who uses his assets productively: "The whole class employed in supplying the wants of society is subdivided into two..The undertakers with large capitals, and the artificiers destitute of any property.. Any estate in land is of equal value with a capital; consequently every proprietor is a capitalist, but not every capitalist a proprietor of a real estate"

Godwin mentions capitalist, but does not define it: "The landed proprietor first takes a very disproportionate share of the produce to himself; the capitalist follows, and shows himself equally voracious."

By going through JB Say, it becomes apparent that 'capitalist' is just another word for Smith's order-that-lives-by-profits: "The knife-grinder..carries his stock..and his his fingers..being at the same time adventurer, capitalist, and labourer."

This definition is supported by Ricardo: "That the profits of the farmer only should be taxed, and not the profits of any other capitalist, would be highly beneficial to landlords."

I think the current definItion of capitalist is taken from James Mill, as a person who lives by profits AND owns the work done: "In this sense of the term 'owners of labour', the parties, concerned about production, are divided into two classes, that of capitalists..and the workmen."

Note that in this sense can only apply if the workers are actually slaves: "The great capitalist..if he operated with slaves instead of free labourers..would be regarded as owner both of the capital, and of the labour."

However, he makes the hugely erroneous but not obvious assumption that the workers of today = slaves: "In the (current) state of is in these circumstances that almost all production is effected: the capitalist is the owner of both instruments of production: and the whole of the produce is his."

Thus, in modern or Mill's capitalism, workers are actually slaves in essence. Ask any employee if he feels like a slave to his boss nowadays and he will likely reply yes. So we can say this idea of Mill destroyed socio-economic freedom espoused by Smith, which in turn became fuel for Marx (who emerged after Mill) to advance his own erroneous beliefs.

9:27 am  
Blogger Gavin Kennedy said...

I'd d
Thanks for your information.
To call workers/labourers slaves is not helpful to scientific discourse. It also trivialises real slavery, of which occasional revelations of modern slavery reveal the differences.

7:43 pm  
Blogger Unknown said...

So to make it 'scientific' we can define slavery as a state wherein one human is owned by another. But merely the idea of owning another does not cause disapprobation since children are 'owned' by their parents or lovers 'own' each other (i.e. She is mine, I am hers). Morality or immorality only enters if pleasure or pain is produced. And this pleasure or pain can only be produced by action. But we do not say actions are owned. Instead, they are willed or controlled. Thus, the real definition of slavery is a regular state of control of another's actions that produces pain. Thus, child slavery is the control of children, sex slavery is control of people for sex, and domestic servitude is control of servants, all producing pain for them.

In Mill's capitalism, the capitalist owns or has the equity of the produce of the workers. But produce is worthless if it cannot be sold for revenue, and revenue is used ultimately for the action of satsifying one's pleasures or avoiding pain. Thus by owning the produce, the capitalist controls or regulates the ability of the workers to get pleasure and avoid pain by limiting their revenue. Connecting the two ideas, we can say that Mill's capitalism is 'revenue slavery'. This kind of slavery brings freedom, or lack of hindrance, to the capitalist to have the pleasures they want, at the expense of the freedom of the workers. So I checked if the concept of revenue slavery exists, and found wage slavery, so the reasoning is consistent.

In contrast to Mill, Smith says that the capitalist should share in the work: "In all manufactures, most workers need material support from their employer until their work is completed. Their employer shares in the produce of their work as his profit." Even when you would expect to find equity, such as in building a factory, equity is non-existent: "Such projectors may carry on most of their projects with borrowed money.. the money borrowed..should be..upon bond or mortgage of private people who can live upon the interest of their money." In fact, Smith limits equity to four industries that are reducible to "strict rule and method".

The distinction between owning vs sharing is important because the idea of 'owning', if developed, leads to equity, centralization, which then leads to lack of competition and too-big-to-fail corporations, increasing arbitrariness and instability, while 'sharing' leads to profit-sharing, friendly competition, smaller more agile companies and less arbitrariness and more stability. So we can say that economic crises ultimately arises from non-sharing, which itself is rooted in selfishness which is a vice.

2:14 am  

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