A lot of people talk about Adam Smith. Very few have read him. Capitalists uphold Smith for recognizing that people act in an economy out of their own self-interest, but he also said some things about poverty and income inequality that would make doctrinaire market libertarians throw up in their mouths a little. Here are five of my favorites.
#1: Poverty is Relative
“By necessaries I understand, not only the commodities which are indispensibly necessary for the support of life, but whatever the custom of the country renders it indecent for creditable people, even of the lowest order, to be without” (III.ii.4). Continue reading →
I am coming out of the closet, but it’s not what you think (probably). “Mom. Dad. I’m a socialist!”
I have felt this way for a long time, but I haven’t wanted to broadcast my proclivities until now. There is just so much prejudice against people like me! Some say people like me are just lazy or greedy! They say we want what others have without having to work for it. It’s especially hard to be a socialist in the United States, where people think socialism means bread lines or brain-washed drones waving little red books. But I have decided that I cannot allow the ignorance or prejudices of others to define me. I have to be who I am, no matter what anybody else may think.
An icon takes something material and makes it transcendent by pointing away from itself. I think the economy should work like an icon. That means the meaning of market activities cannot be found in a market. This is something we forget a lot of times. Part of what it means to be in a market society is that we work ourselves to death and never bother to ask, “Why?” Maybe I am nuts or maybe I am naive, but I don’t think this is what life is supposed to be like.
Consumption is the sole end and purpose of all production; and the interest of the producer ought to be attended to only so far as it may be necessary for promoting that of the consumer. –Adam Smith, Wealth of Nations
To explain how capitalism enables a “sick epectasis,” I need to offer a brief history of the liberal (i.e. “liberated”) market.
Pretty much every economist agrees that capitalism originated with Adam Smith’s Wealth of Nations (a book which most partisans of capitalism have never bothered to read). Smith’s genius was in recognizing that the market is not a zero-sum game in which one person must lose for another to win. Two people, motivated by their self-interest, could both benefit from an exchange. A number of other ideas are connected to this basic insight. Continue reading →