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The Forum > Article Comments > The invisible right hand and the invisible left hand > Comments

The invisible right hand and the invisible left hand : Comments

By Gilbert Holmes, published 1/9/2010

The simple logic of Adam Smith's 'invisible hand' has switched on the minds of generations of deep thinkers and economic policy makers.

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Mikk,

"If the cup maker was really interested in benefiting society he would have sold the cups for $1 or better still showed his fellows how to make them themselves."

What makes you think that the cup seller was interested in benefiting society?

"Production in a free and democratic society would be mutualism and solidarity and geared to helping and improving society as a whole not individual mega consumption and luxury goods before basic needs are met for all."

It seems to me that you are assuming either that we are benevolent by nature or that it will be best if we are coerced into behaving in a way that we do not necessarily want to. Unfortunately, embodied in Marx's interpretation of history, 'dialectical materialism', which tells us that the way that we think is determined by the shape of our society, these two assumptions have led to the disastrous idea that has plagued efforts toward communism: 'as soon as we kill all the arse-holes then we can all move into mutually supportive communities together'.

I agree that the cup seller was a greedy person and would probably have ended up either paying off the cops or being run out of town, but this does not prove that all private interest is necessarily bad for the society.

Pelican, hopefully we can avoid disaster.

The dialectic (not Marx stupid version) looks at progression within nature swinging between archetypal polar extremes, and also sometimes finding balance. With the struggle between capitalism and communism cooling off, and with the emergence of feminism, environmentalism, modern physics, the influence of Eastern philosophy on the West, the increase of democracy within governance over recent centuries, etc, I think that we have good reason to hope that we are moving into a period of balance.
Posted by GilbertHolmes, Thursday, 2 September 2010 10:21:06 PM
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<<What makes you think that the cup seller was interested in benefiting society?>>

Isnt that the whole point of business/commerce?
Or is it really(as I think it is)just a sham based on greed and the powerful exploiting the weak?

If this cup seller example is a valid expression of "business" or "economics" then it should be able to show us common features that are directly relevant to all business. Isnt that why we are even talking about it?

So what is it? Business and commerce for the benefit of society and humankind in general?
Or business for the greedy and unscrupulous giving them disproportionate control of resources and dominating and most likely exploiting other people.

<<you are assuming either that we are benevolent by nature>>

I think people are capable of all sorts of good AND evil. We are not born sinners and we are not born benevolent. We learn and we are shaped by our society. The only thing we are "by nature" is social. We NEED other people. We are above all social creatures.

Modern, capitalist society is systematically removing all of those institutions that support our need for other people and a sense of belonging. The results are becoming plain for all to see.
If your society treats you as a commodity who only works, consumes and breeds then is it any wonder we get stressed and prone to disease mental and physical. Is it any wonder we are alienated and lonely and antisocial behavior and crime is on the rise?

Capitalism has not cooled off it is ramping up every day. The wars, conflict, inequality, overwork, unemployment, economic crises, environmental crises, exhaustion and shortage of resources, massive waste and a concentration on consumer and luxury goods while people starve and freeze to death.

I dont want balance I want freedom. Freedom from governments. Freedom from bosses. Freedom from domination and hierarchy. Freedom from "the market". Freedom from god/s. Freedom from capitalists and their fouling of our nest. Freedom from the wealthy parasites that are sucking us dry.
Posted by mikk, Thursday, 2 September 2010 11:39:47 PM
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You seem not to understand the concept Mikk; and things that are in relative perspective , are indeed Very simple concepts to understand, but have been perverted in words and definition of those words “Machiavellian” as to cloak and hide the actual intentions:

Fatalism is not a Natural Humane trait , in fact it is the opposite to every natural law known to man; and is why wars and Feudalism,Neo Barrens and self appointed Gods of their own Naivety expounded it , Naivety , Ignorance and belligerence remains rife today , splintered amongst what is known as Political oligarchy and their Minions .

The Simple law is, Collectivism is Totalitarianism, That is a fact, - and then applies this theory,
It is Not Yours to GIVE
It is not you’re to TAKE
But they do.
Posted by All-, Friday, 3 September 2010 4:49:57 AM
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Let’s look at this first from the socialist/interventionist point of view, then from the libertarian POV.

The question is whether particular resources should be owned or controlled privately or publicly; where publicly means governmentally, and governmentally means based on law - threats of prison.

It is no use wishing that there were some other third way. While ever tax remains compulsory, all governmental ways boil down to force and threats, and hence are just more of the second way, not some imaginary third way. The fact that people pay it with as little resistance as they do, is not because they consent, but because they know that resistance is futile.

Mikk, can you see how it is not competent, if you are trying to prove that something is exploitative, to argue that it is “exploitative”? Though you constantly repeat this mantra, you have not established that business is, or that labour is not, exploitative in the first place. This primary-school level circularity underlies your entire argument.

When I ask how mikk knows the difference between the market price and the fair price, he answers, in effect, the difference between the market price and the cost to the producer.

According to this logic, no-one has a moral right to any more than their costs of doing something, because to take more would be “exploitative”. Anyone charging more than the costs of his production is exploiting his fellow-man and has no right to any surplus value.

But this would apply as much to a worker as to an entrepreneur: mikk hasn’t shown the distinction except by circular argument. It would also apply not only to entrepreneurs and workers, but even in the absence of any money transaction. Since profit - a benefit in excess of costs - is an immoral quantity, no-one would be entitled to a non-monetary benefit in excess of his non-monetary costs either.

The absurdity of this view should be obvious.
Posted by Sienna, Sunday, 5 September 2010 11:28:05 AM
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It would mean that no-one would be morally entitled to take any action, because the purpose of any human action is to produce an outcome that is better from the standpoint of the person taking the action.

But if the surplus value of our labour over and above our costs is “exploitative”, then obviously no-one has a right to the fruits of his labour.

When the problem of self-ownership is pointed out, mikk replies that he’s talking about property, not people. But according to his own theory, property assets are nothing but the embodiment of people’s labour. So mikk *is*, in his own terms, advocating treating people as property. Else how can we claim someone else’s involuntary labour, but deny that we are treating him as a chattel?

Pelican tries to get out of the problem by saying we are not talking about women providing sexual services, we are talking about “shared assets”. But if taxpayers’ involuntary services can be regarded as a “shared asset”, how do you distinguish a woman’s involuntary sexual services? If slavery was legal, would that make it okay? If a majority demanded she “share”, would that make it okay? Well morally how is taxation any different? The *type* of service is irrelevant.

Thus the socialist/interventionist POV flounders in its own self-contradictions and absurdities.

And this is on the heels of recent posts in which they have been completely unable to show how any alternative they stand for would be able to produce a net benefit compared to the status quo.

Now let’s look at it from the libertarian point of view.

The division of labour *is* the social principle. It is what causes people to form societies. At first the division of labour was confined to the smallest social units of family and village.

But once people started to recognize that labour in co-operation is more productive than labour in isolation, they increasingly gave up the old warrior ethos that plunder and enslavement are the way to wealth, realising that peaceful trade is more civil and productive as well as more ethical.
Posted by Sienna, Sunday, 5 September 2010 11:34:53 AM
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Modern liberalism, by increasing the division of labour to its highest level ever, has been responsible for the greatest levels of wealth, health, and freedom in the history of the world; while socialism, so-called, has opposed it at every step, retarding the division of labour, consuming capital, promoting big government and their wars, suppressing choice and freedom, fundamentally believing that coercion, monopoly, and involuntary servitude are the way to a better civil society.

Liberty and property are two sides of the same coin. You can’t have one without the other.

This is because property arises out of:
1. Self-ownership
2. The fruits of one’s labour from acquiring previously unowned resources, or from property that one has acquired without violating someone else’s right to self-ownership, and
3. Peaceful exchange of one’s property.

Ownership means the right to exclusive possession and control.

We must own ourselves, because no-one can even deny it without exercising exclusive possession and control of his own body to engage in the action of denying it. Thus even one who denies it engages in a self-contradiction of performance.

Thus self-ownership is axiomatic, since everyone must implicitly affirm it, whether they affirm or deny it. “Actions speak louder than words.”

By appropriating unowned nature to oneself, one rightly establishes ownership. By breathing in air, I establish a moral right to it. By eating an apple rightfully acquired, I incorporate it into my body and become its exclusive owner.

By actions not aggressing against others’ self-ownership, ie voluntary interactions, one can acquire morally valid property rights. But if not, how could the mythical mystical monopolistic aggressive decision-maker “the community” be in any better position?

All morality and property rights follow from the axiom of self-ownership, and the non-aggression principle.

In denying self-ownership, socialists are implicitly a) contradicting themselves and b) claiming a right to aggression against others, and then have the gall to pretend to a higher moral standard!

Thus capitalism is the only moral as well as the only practicable alternative to the slave philosophies of socialism and interventionism however called.
Posted by Sienna, Sunday, 5 September 2010 11:39:09 AM
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