Alan's goddess and Adam Smith are currently influencing a virtual capitalist smackdown.
Adam Smith’s "invisible hand" has been slapped away by the "free hand" of Market Fundamentalists
Alan seems smitten for life by a lust for greed and a veneration of the virtue of Randian "Selfishness."
The venerated Adam Smith would reject this kind of excess and corruption of his concept of an "invisible hand" guiding a "sympathetic" and ethical marketplace.
Part Two in a Series
Part One: http://www.dailykos.com/...
Lively discussion below the fold...
Recent commentary on the impact of Ayn Rand--"last century's loony goddess of selfishness"--and AM radio punditry:
"Ayn Rand," the Wall Street Journal reports, "died more than a quarter of a century ago, yet her name appears regularly in discussions of our current economic turmoil. Pundits including Rush Limbaugh and Rick Santelli urge listeners to read her books, and her magnum opus, 'Atlas Shrugged,' is selling at a faster rate today than at any time during its 51-year history."
The message of that turgid 1200-page opus, that money is the root of all good, has inspired those who need justification for extreme selfishness and for looking down at the rest of humanity as "looters" and "moochers."
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Now that Greenspan has helped devastate the economy, the president of the Rand Institute is proposing that only more of the same will save it:
"Why do we accept the budget-busting costs of a welfare state? Because it implements the moral ideal of self-sacrifice to the needy. Why do so few protest the endless regulatory burdens placed on businessmen? Because businessmen are pursuing their self-interest, which we have been taught is dangerous and immoral...
"The message is always the same: 'Selfishness is evil; sacrifice for the needs of others is good.' But Rand said this message is wrong--selfishness, rather than being evil, is a virtue."
For those who can tolerate such stuff, reading "Atlas Shrugged" is punishment enough. At least Gordon Gekko with his message of "Greed is good" in Oliver Stone's "Wall Street" was an entertaining son-of-a-bitch who did not offer himself as an exemplar of a higher morality. Rand said this message is wrong--selfishness, rather than being evil, is a virtue."
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At least Gordon Gekko with his message of "Greed is good" in Oliver Stone's "Wall Street" was an entertaining son-of-a-bitch who did not offer himself as an exemplar of a higher morality. Source: Ayn Rand Rises Again, Who's next? Gordon Gekko?, http://ajliebling.blogspot.com/... , 3/15/09
On sharp contrast, Adam Smith firmly grounded his principles in support of the "invisible hand" in the principles that the market can balance and sustain itself on the premise that first the marketplace must be ethical and moral, truthful and endued with integrity, even "sympathy."
Smith would have no part in greed and avarice. How disingenuous of the present crowd of Wall Streeters, Hedgefundites, CEO’s, and unfettered Capitalist mavens, who use his "invisible hand" to justify and fortify their trek down the economic road to perdition, knowing what they have done to deceive and defraud the investor community worldwide.
How perverted has the vulgar and corrupted use of Smith’s concept of the "invisible hand" become making his concept appear a magical, self-sustaining device which is believed to function irregardless of the moral natures of its players and without the full trust and confidence between its fiduciaries and investors.
Adam Smith’s The Theory of Moral Sentiments undertakes his principles concerning moral values with this introduction:
How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortunes of others, and render their happiness necessary to him, though he derives nothing from it, except the pleasure of seeing it. Of this kind is pity or compassion, the emotion we feel for the misery of others, when we either see it, or are made to conceive it in a very lively manner. That we often derive sorrow from the sorrows of others, is a matter of fact too obvious to require any instances to prove it; for this sentiment, like all the other original passions of human nature, is by no means confined to the virtuous or the humane, though they perhaps may feel it with the most exquisite sensibility. The greatest ruffian, the most hardened violator of the laws of society, is not altogether without it.
Smith would be violently revolted by any decision to validate Ayn Rand’s self-centered, greed driven hero, Galt, appearing in Atlas Shrugged, where she used literally construction and a novel story to convey her extreme capitalistic maxims using him as an archetypal "superman," the fantasy hero of many Wall Streeters--whom Rand has led to corruption and ruin
Ronald E. Merrill authored The Ideas of Ayn Rand. A reviewer, Robert Wilfred Franson, wrote a critique in 1991:
He (Ronald E. Merrill) is neither attacker nor apologist, and if he speaks for the Objectivist movement, it is the movement of ideas, of intellectual history, not an official school or party-line. Merrill does go into as much of Rand's personal history and "movement" history as he feels necessary to tie together her intellectual and artistic development. While Merrill works to be balanced and fair throughout, it is unfortunate that his very last word, right before the bibliographical listing, is thoughtcrimes.
Ayn Rand guilty of thouthtcrimes?
However, the clever and persuasive goddess of extreme capitalism, Ayn Rand, is guilty of "thoughtcrimes." She infected both Alan Greenspan and Rep. Ron Paul among many others, those who wish for a deregulated world where the unfettered individual capitalist is the measure of all things, one man’s needs paramount to all others.
Smith proclaims the need for judgment to ascertain "just or unjust" action
...Smith puts forth that not only are the consequences of one's actions judged and used to determine whether one is just or unjust in committing them, but also whether one's sentiments justified the action that brought about the consequences. Thus, sympathy plays a role in determining judgments of the actions of others in that if we sympathize with the affections that brought about the action we are more likely to judge the action as just, and vice versa:
If upon bringing the case home to our own breast we find that the sentiments which it gives occasion to, coincide and tally with our own, we necessarily approve of them as proportioned and suitable to their objects; if otherwise, we necessarily disapprove of them, as extravagant and out of proportion (p. 20)
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Ayn Rand brooks no sympathy playing "a role in determining judgments of the actions of others." The striven hero of Atlas Shrugged is not an example of communal sympathy or concern for other's status, prosperity, or success, rather he seeks his fortune by subjugation of altruism and sympathy to his "rational" pursuit of his own personal self-interests.
Smith and Rand are polar opposites
In stark contrast to Ayn Rand, Adam Smith holds forth:
... people become intolerable to each other when they have no or sympathy for the misfortunes or resentment of each other: "You are confounded at my violence and passion, and I am enraged at your cold insensibility and want of feelings" (P.26)
Smith points up further the necessity of "sympathy"—altruistic feelings:
...the "perfection" of human nature is this mutual sympathy, or "love our neighbor as we love ourself" by "feeling much for others and little for ourself" and to indulge in "benevolent affections" (p. 32). Smith makes clear that it is this ability to "self-command" our "ungovernable passions" through sympathizing with others that is virtuous.
The necessity of ethical values and behavior in the sustainable life of a functioning marketplace
Adam Smith had very much more to say and propound concerning the ethical values he saw necessary for the greater good of men and civil society.
Vernon L. Smith delivered a lecture in which he argued that Theory of Moral Sentiments and Wealth of Nations together dovetail and compliment one another, in that Smith envisioned:
"(O)ne behavioral axiom, 'the propensity to truck, barter, and exchange one thing for another,' where the objects of trade I will interpret to include not only goods, but also gifts, assistance, and favors out of sympathy ... whether it is goods or favors that are exchanged, they bestow gains from trade that humans seek relentlessly in all social transactions. Thus, Adam Smith's single axiom, broadly interpreted ... is sufficient to characterize a major portion of the human social and cultural enterprise. It explains why human nature appears to be simultaneously self-regarding and other-regarding."
Smith's far superior to Rand in regard to ethics
How far above Rand was Smith in his assessment of the needs of man and the role of "moral" man in a society where goods and services are freely traded and honesty provided--such that an "invisible hand" is seen to provide checks and balances, credulity and integrity, to the success of such a marketplace--where mutual respect and sympathy are present endued with ethics that are "self-regarding and other-regarding". How radically different this is from the huckster’s mantra: Get it from your friends, you never see your enemies.
The Catholic Church’s official view toward usury remained unchanged until the 19th century, but the Reformation—which occurred principally in northern Europe—brought about a mild acceptance of usury.
The Morality of Moneylending: A Short History, Yaron Brook
There’s a reason the "profit motive," acceptance of usury ,was slow coming to approval within the Catholic Church and via the church applied to the Western marketplace.
Protestants and the Profit Motive
It is actually the influence of the Protestant Movement, Martin Luther and John Calvin, that vigorously injected the concept of profit into reformist doctrines of public life.
Until its more widespread approval, it was well-know that rampant fraud and thievery connected to unbridled profits were dangerous passions in the hearts of selfish and greedy men. Only by carefully restraint and discipline of religion where those evil intentions corralled--calming men's raging passions—offsetting greed stoked by ill-gotten gains. Only acting with a moral conscious and integrity could men live in common with one another, build a society, thrive and prosper in trade and transactions each with the other. The Church knew that there must be limitations on the marketplace and the evil that resides in the love of money--the root of all human evil is not a virtue.
Catholic doctrine aims for a balance between ethics and the needs of the market.
The following assessment of the Catholic view of distributive Justice, submitted by the blogger, NYGaribaldi, gives a good insight as to the proper balance between ethics and the marketplace:
Capitalism at its best unleashes creative forces that have provided a vast improvement in standards of livings in many, many societies. But while capitalism is the most efficient vehicle across the board, it has also been uneven and sometimes unfair in its results. The trick is to make capitalism more democratic and thus more just.
For far too long this viable economic philosophy has been in the hands of buccaneer types who see market-based economics as an excuse to satisfy greed and do so under the guise of "economic freedom." Clearly, there is no freedom for the collateral victims of economic practices that have no consideration for the common good. As we have seen in the 1920s and in the post-Reagan years, unfettered capitalists left to their own devices will only care about one thing and one thing only: maximizing profit. Government’s proper role is to not to eliminate their capitalistic instinct, but to prevent that instinct from causing unnecessary collateral harm.
The distributive justice model differs from the laissez-faire model is in its understanding that a just form of capitalism requires a sturdy government guarding against exhibitions of arbitrary economic power. Its mechanisms include the governmental oversight oversight of financial institutions, progressive taxation and policies that favor the distribution of profit primarily based upon an individual’s contribution in creating such profit. Source: Marxism? No, Just "Good Catholic Doctrine!" @ http://www.crossleft.org/...
Submitted by NYGaribaldi, 10/31/2008
Catholic Social Teaching: Centesimus Annus and Solicitudo Rei Socialis
[T]here are many human needs which find no place on the market. It is a strict duty of justice and truth not to allow fundamental human needs to remain unsatisfied, and not to allow those burdened by such needs to perish... Even prior to the logic of a fair exchange of goods and the forms of justice appropriate to it, there exists something which is due to the person because he is a person, by reason of his lofty dignity. Inseparable from that required "something" is the possibility to survive and, at the same time, to make an active contribution to the common good of humanity. --Centesimus Annus
[T]he goods of creation are meant for all. That which human industry produces through the processing of raw materials, with the contribution of work, must serve equally for the good of all. -- Solicitudo Rei Socialis
Capitalism and Catholic Philosophy
Catholic theologians and socialists were the most serious critics of early capitalism. They rejected one of the most fundamental premises of capitalism: Methodological individualism.
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Catholic philosophers and socialists believe that each community has a common good: that is, a system of ends representing all absolute social values. Therefore, the prevailing institutional arrangements and the rules of the game must channel the behavior of the individual members toward the pursuit of the common good. The community is then conceived as an organic whole in which each individual is expected to subordinate his private ends and cooperate with others in pursuing the common good.
The classical liberal (capitalist) community has no common good. It is a voluntary association of individuals who join and leave the community in pursuit of their own private ends.
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Catholic philosophy has raised the issue of the legitimacy of capitalism as a moral system. The origin of this issues lies in the basic difference between the Catholic and the capitalist concepts of community. The capitalist community considers community the community as an organic whole whose members cooperate with each other in the pursuit of a prescribed outcome (common good).
What classical liberals considered as the freeing of man from the constants of medieval tradition, Catholic philosophers saw as an erosion of morality and rejection of "absolute" values.
Source: Chapter 3, The Rise of Socialism, The Economics of Property Rights: Towards a Theory of Comparative Systems
Catholic thinkers have gone beyond simple skepticism about freedom of choice, personal rights, and individual liberty to hold to the foundations of community: respect for honesty, integrity and moral credibility cradled in their belief in the common good.
Smith's "invisible hand" aligns with Catholic ethics, Ayn Rand goes it alone convinced of the Objectivist ethic's radical self-interest and greed--a unrestrained "free hand" in the marketplace.