At one time or another, most of us would like to avoid the ethical. By ethical I mean the moral dimension of our relationship with others. As I have detailed in Civilizing the Economy, one of the best illustrations of this is Adam Smith’s use of the “invisible hand” in his The Wealth of Nations.
Sometimes a picture is worth a thousand words, or almost a thousand. As I demonstrate in Civilizing the Economy, Adam Smith knew that the slave-based tobacco trade was a major source of wealth in Scotland and especially in Glasgow, where he lived when collecting material for The Wealth of Nations. Instead of telling us this, he tells us about the invisible hand, a good illustration of what we can call the economics of dissociation: a process of splitting off the misery of the real providers of wealth and then feeling optimistic about market dynamics.
Response to Adam Gopnik’s essay “What Adam Smith really believed” in the Oct 18th New Yorker magazine
In his article on Adam Smith, Adam Gopnik leaves out a couple of important facts about the life of Adam Smith that provide clues to a very different story than the one Gopnik tells. First of all, there is Adam Smith’s request that all his papers be burned after his death. Everything. And this was done. Why such a request? Was Smith hiding something? It turns out he was: something that has remained hidden from many admirers of Smith, including Gopnik.
Calling Adam Smith’s treatment of slavery in CTE his “silence” about slavery is really a polite way of exposing his cover-up of the role of slavery in the creation of the wealth that he enjoyed. I admit that at various times Smith did say things about slavery in his book on the causes of wealth, The Wealth of Nations, but not when he was writing about the causes of wealth.
Of the fallacies we hear in modern economics, few are more pernicious that those that attribute action to the “market.” The master example is Adam Smith’s substitution of the “invisible hand” for the tobacco lords, plantation owners, and slave traders, who brought about misery to the slaves in the Americas and “opulence” to Smith’s circle of friends in Glasgow. The legacy of this deception continues to infect current economic thinking.