I’ve purchased two books, this one “Adam’s Fallacy: A Guide To Economic Theology”, as well as “Economics As Religion: From Samuelson to Chicago and Beyond”. There are any number of books on this theme.
Note: This book was a waste of time and money. It is a silly marxist pamphlet. I can summarize it as “poor people breed too much and capitalism doesn’t care” when in fact, capitalism simply makes it very expensive to have children and those who breed irresponsibly are punished abstractly by enduring poverty rather than forced by village and tribal elders to leave their child exposed and dead. The vast silliness of the logic in this book is unworthy of further commentary.
I’m surprised that this notion of economic religion is not more commonly discussed in the venal press. But it is too valuable a tool of those who wish to empower a democratic state and it’s politicians who are, quite frankly, at a loss to apply something other than the practicalities of getting elected, or the mysticisms of our founding documents, christian religion, or marxian fantasy.
I start with Adam’s Fallacy.
Using the KIndle edition on a mac, and therefore cannot annotate in place, and am not sure of page numbers. (This is a problem we need to fix, because we’re going to increasingly use dynamic text, which requires paragraph numbering not page numbering. Anyone remember wordperfect versus word?)
I am not sure I buy the argument that smith created a fallacy by separating market life from personal life. The Wealth Of Nations (TWON) is only the second half of his philosophy. the first is The Theory Of Moral Sentiments. (TOMS) They together represent his insight that the division of labor increases production and that human sentiments to cooperation at both the intimate, interpersonal, local, social and global level. While we are only in the preface, I’m not sure I buy the assumption because it’s too loose an assertion. Instead, I blame Knight and Keynes. Smith is nothing but a moral philosopher.
“Contemporary economics has grown into a major intellectual industry” I hope this is elaborated further because it’s the the same problem presented by the clergy. People depend on perpetuating the faith.
“Teaching economics reinforces the world view I call Adam’s Fallacy”. I don’t think so. I think that’s the crowd post 1900.
“Teaching students to think like economists .. is hard.. and thinking like an economist … is just as value laden as any other way of thinking about society”. The idea in economic reasoning is the broken window problem: the need for all humans to think in terms of secondary causes and to follow the chain of secondary causes. This teaches people to think more deeply about the trade offs of both personal and political decisions. Yes it’s hard for people. Otherwise we wouldn’t need a market.
“The moral fallacy of smith’s positin is that it urges us to accept direct and concrete evil in order that indirect and abstract good may come of it.”
Well, now, we need a definition of evil, don’t we?
“neither smith nor … his successors have been able to demonstrate rigorously ad robustly how private selfishness turns into public altruism”.
I don’t think he says that. I think he says that by participating in the market europeans will have fewer wars.
CH1 – The Division Of Labor
“Smith leaves unanswered the chicken and egg question of whether it is ultimately the human propensity to truck and barter that lads to the division of labor, or the division of labor that compels people to exchange.”
Isn’t this a false dichotomy? People have always bartered and exchanged. the division of labor is simply more profitable for the individual. Ask any art-jeweler or craftsperson, who starts out producing one offs, but determines that quality of life depends upon his or her development of a product line that can reliably produce revenue, so that she is free to create those individually interesting pieces.
The VIrtuous spiral of economic development.
“Smith puts his faith in the ultimate benefits to be gained from the virtuous spiral to in crease standards of living and enhance the wealth of …. the sovereign.”
“… rise in labor productivity has at least one immediate and negative effect: a reduction in the demand for labor in the industries undergoing raid rises in productivity. …. unemployment can result.”
“thus say’s law is based on a belief in the efficiency of the financial institutions of a capitalist economy”
I don’t think so. I think it’s based on the belief that no other alternative is available while retaining the productivity RELATIVE to other nations, so that wars can be averted, and we can overcome the myth of the fixed-pie.
“some of these displaced workers will eventually find alternative jobs”
Yes, they will. They just might not like them. The alternative is that people should subsidize workers to produce goods at increased cost of goods to themselves and/or that the entire enterprise of production that employs ALL workers will fail to compete for market share against people from OTHER nations. In other words, it’s the smallest of three evils.
“It appears that over long periods of time, says law does operate”
Well, of course it does. At this point I’m frustrated because I don’t understand the problem. I know marxian fantasy must be in here somewhere by now.
THEORIES OF VALUE
I cannot for the life of me discern what point he is trying to make here.
MARKET PRICE AND NATURAL PRICE
Well, since the time of smith we understand that the labor theory of value is flawed and we have dismissed this part of smith as an error. So I don’t see this as material.
he states in many more words ,that natural prices and market prices are in disequilibrium at all times. This makes no sense because a natural price is a tool for us to use to conceptualize movement, and a market price is a thing that comes into existence. So far either he is trying to accumulate a later argument or he’s simply confused.
“contemporary economics on the the hand, focuses more theoretical attention on the the ideal imaginary state of equilibrium where market price and natural price coincide.”
At this point he is trying to build an argument upon a falsehood – the labor theory of value and natural price. I hope that this is going somewhere. Either that or he is trying to state that the DSEM construct is a myth, and we all understand that it’s a myth. There is no bell curve. There is no equilibrium. It’s just a construct we use so that we can apply math because without that construct we CANNOT apply math.
“… wages have the social function of allowing workers to reproduce themselves” (he means have children). “In order for wages to perform this function, they have to be high enough to allow workers to buy a subsistence standard of living”
Ok, so this is supposed to be that the poor have the right to breed? So when did this become a social good? the problem for mankind since industrialization is that people simply don’t die, and they’re expensive. Our problem is overpopulation not supporting the unproductive people’s fantasy of unrestrained child birth.
“Smith associates high wages and a high workers standard of living with a growing capital stock”
Yes, I agree.
at this point I understand that he is providing contemporary context. I read the rest of chapter1 and move to chapter 2 in the hopes that he is going to provide some insight here. Note to authors. Make your premise first then prove it so we don’t have to guess our way through your fantasy.
“Behind this…. lies the unpleasant truth about capitalist social relations. The organization of the social division of labor through commodity exchange and wage labor systematically inverts the ordinary logic of human relationships.”
What logic is that? That people have not exposed children for years, or even outright murdered them or sold them into slavery if they could not support them? In fact, breeding differences account for large differences in the prosperity of difficult cultures. So is this the author’s point? That he has some fallacious concept of the ‘right to breed’, instead of the ‘responsibility to only breed a child you can afford to feed?”
Then he goes on to say that marx systematically breaks down and…. helps us understand. What he does instead is create a system of justifying primitivism.
Look. We converted from hunter gatherers to farmers. We figured out how to control our breeding by creating the ‘family’ and monogamy. This made families economic units that could manage resources.
We invented the market, and the tools of quantitative cooperation we call money, accounting, numbers, interest and credit. We increased our ability to breed further, but penalized those who have less foresight.
Capitalism creates temporary extraordinary wealth then forces people to control their breeding in order to participate in the wealth. Those who don’t, suffer because of their choices.
We just have a more abstract way of controlling population.
( INSERT A VAST AMOUNT OF JUSFICATIONISM OF MARX HERE. )
ESCAPING ADAM’S FALLACY
“thus we cannot look to capitalism to solve inequality and poverty”
That is correct. WE can only look to capitalism to provide the incentives for controlling reproduction so that the poor do not doom themselves to perpetual poverty in a world where children do not provide security or comfort but are a drain on resources.
In other words. This is a silly marxist book, and I wasted two hours reading it. The chinese solved it with the one child policy, and it was a good policy and successful. Rather than redistribute ourselves into mutual poverty and regale the thought leaders of the past, you could simply write a book on the value of the one child policy, or at least, pay men and women to sterilize themselves. Capitalism makes poverty a choice of reproduction.