By Allan Brawley
We have gone way beyond simple pay-to-play politics or even living in an
oligarchy where the rich and powerful have a disproportionate influence
over public policy.
We are now at a point where the power of “We the People” that the
Founders put in the driving seat of our democratic system no longer
applies. Short of a few million dollars, don’t even think about
participating.
We were promised that, if we played by the rules, we would enjoy the
rewards of our efforts with good jobs, decent wages, and a steadily
improving quality of life, not only for ourselves but, more importantly,
for our children and grandchildren. If we invested our savings in a
home, our own and our children’s education, and for our retirement, we
could sleep nights, confident that the much-vaunted American economic
machine would deliver for us. That has been a cruel joke.
Many of us have been deprived of our livelihoods, savings, and homes
while the perpetrators of this national and global calamity remain in
charge and unpunished. Not only that, they continue to reap huge
profits, salaries, and bonuses which they use to buy politicians and
laws that further enrich them and insulate them from the type of
reckoning that is essential.
This type of predatory behavior is not new, of course, but it is being
conducted on a much larger scale and with more powerful tools – and is,
arguably, much more dangerous to the country — than what occurred a
hundred years ago during the Gilded Age and reoccurred in the 1930s,
leading to the Great Depression. The damage caused to the economy and
the democratic process by unregulated corporations and corrupt
politicians led to reforms at the federal and state levels, including
anti-trust laws and corporate, banking, stock market and workplace
regulation. These safeguards against corporate and other abuses were
enforced for the next 30 years until “big money” took over the
Republican Party in the 1970s and began a systematic assault on
government at all levels, using vilification, distortion and outright
lies to advance their cause. We are now experiencing the consequences
of three decades of corporate deregulation, tax breaks for the
wealthiest Americans, a complete disregard for the poor and vulnerable,
and an all-out attack on working people and those who try to speak out
for them.
All of this has been done in the name of supposedly well-established
economic principles, originally laid out in the bible of the unfettered
free-market capitalists, namely Adam Smith’s 1776 book, Wealth of
Nations. However, those who claim to be Smith’s most ardent disciples
have either never read it or been very selective in the lessons they
have drawn from it. Smith would surely turn in his grave if he knew what
was being done in his name.
Far from advocating the completely unrestrained corporate behavior that
is attributed to him by those who benefit most from that ethos, this
long-time Professor of Moral Philosophy (not Economics, Finance or
Entrepreneurship, please note) sought to develop a comprehensive set of
philosophical principles that would guide individuals in their quest to
live virtuous lives and participate constructively in a variety of
spheres in modern civilized societies, including commerce. Smith’s
present-day acolytes should not only read Wealth of Nations more
carefully but also its companion volume, The Theory of Moral Sentiments.
As Nicholas Phillipson brilliantly sets forth in Adam Smith: An
Enlightened Life, these two volumes were part of a long-term project of
the Enlightenment to develop a comprehensive “Science of Man,” that
included law, aesthetics, economics, history and ethics. First and
foremost, Smith believed that all constructive members of civilized
societies needed to develop an internal moral compass – what he called
the “the impartial spectator” — that would enable them to do the right
thing in their own as well as in other people’s eyes.
He illustrated how this principle would work: “In the race for wealth,
and honors, and preferments, (the individual) may run as hard as he
can, and strain every nerve and every muscle, in order to outstrip all
his competitors. But, if he should justle (sic), or throw down any of
them, the indulgence of the spectators is entirely at an end. It is a
violation of fair play which they cannot admit of.” These are hardly the
words of a person who would encourage the type of predatory behavior by
the crony capitalists that we have witnessed in recent years. On the
contrary, rather than propound such self-serving chimeras as “if we
increase the wealth of the rich, it will trickle down to the rest of
us,” “the market is self-correcting,” or “the wealthy are the
job-creators,” Smith explicitly identified labor as the source of all
other wealth.
As he put it, “The property which every man has in his own labor, as
it is the original foundation of all other property, so it is the most
sacred and inviolable.”
Smith condemned those merchants and manufacturers of his day who argued
that their nation’s wealth and power flowed from expanding overseas
trade. They “knew perfectly well in what manner it enriched themselves.
It was their business to know it. But in what manner it enriches the
country was no part of their business.” Doesn’t this sound familiar?
Have we not been repeatedly witness to and victims of the self-enriching
behavior that Smith decries but is advocated by the professed disciples
of his economic principles? In fact, he goes even further in his
condemnation of the merchant classes whom he viewed as frequently
ruthless in their pursuit of wealth.
“It comes from an order of men whose interest is never exactly the same
with that of the public, who have generally an interest to deceive and
even to oppress the public, and who accordingly have, upon many
occasions, both deceived and oppressed.”
Smith would be appalled by the behavior of those who justify their
selfish actions by citing his name and the economic rules that he
supposedly espoused. While it is true that he thought that markets
worked best when laborers, artisans, farmers, merchants and others were
freed from the control of feudal masters and royally-sanctioned
monopolies, that did not mean that these folks should then engage in
cut-throat, race-to-the-bottom, survival-of-the-fittest competition with
each other. On the contrary, “Commerce ... ought naturally to be … a
bond of union and friendship.” The constraints on the free flow of goods
and services that he was arguing against were those
government-supported monopolies (royally-sanctioned, at that time) and
the empire-building trade wars that they engaged in. In his view,
promoting internal commerce would always be more beneficial to the
public as a whole than foreign adventures, motivated by “the mean
rapacity, the monopolizing spirit of merchants and manufacturers who
neither are nor ought to be the rulers of mankind” but whose actions
have, “during the present and preceding century, been … fatal to the
repose of Europe.”
Contrary to this distressing record of destructive international
competition for power and resources, Smith believed that trade among
nations – like that within the domestic economy — should be based on a
similar “bond of union and friendship.” Not only do we need to revisit
and apply, in updated form, the real versus the corrupted version of
Smith’s principles in order to set the country straight economically, we
must also attend to the warnings of the Founders regarding the
corrupting effect of money on the democratic process.
Alan Brawley is professor of social work at Arizona State University.
From The Progressive Populist, June 15, 2012
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