Critics of Market Theology

Boston NPR / WBUR ^ | Thursday, November 30, 2006 | Tom Ashbrook/Duncan K. Foley

[A. Pole]

The father of modern economics, Adam Smith, wrote more than 200 years ago about the all-powerful "invisible hand" of the market. It was tough, he said, but good for all.

The late Nobel Prize-winning economist Milton Friedman was the great champion of the invisible hand and free markets. Governments, he said, should just let markets do their work.

Economist Duncan Foley, in his new book "Adam's Fallacy," says wait a minute. This is free market theology, he says, and it's producing a value-free society, an unequal society, an immoral society.

This hour On Point: the author of "Adam's Fallacy" meets the defenders of Adam Smith.

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Quotes from the Show:

"Ultimately, material productivity comes because people are working hard. It doesn't come because they are following a particular value system or correctly playing the market." Duncan K. Foley

"I am not against markets." Duncan K. Foley

"We tend to neglect the fact that markets exist in a context created by other institutions." Duncan K. Foley

"Adam Smith also wrote a book on morals." Allan Meltzer

"To make a whole person, we don't have to do it all in the economics classroom." Allan Meltzer

[A. Pole]

"[...] free market theology, [... is] producing a value-free society, an unequal society, an immoral society. [...]"

[farlander]

I guess they'd prefer a completely equal society. Like Communism. Where everyone is equally miserable.

[devane617]

I wonder if Adam Smith imagined Hedge Funds and the negative impact they could have.

[raybbr]

I haven't listened but I would tend to agree with the ultimate end of capitalism - crushing man under the weight of gold.

Capitalism unchecked (super capitalism) ends up destroying society for want of material wealth. Capitalism needs a soul. Without one it is just another machine that ignores humanity.

[XR7]

"What does it profit a man if he should gain the whole world, but lose his soul?" -- Jesus

[68skylark]

The folks at NPR have never understood America -- they don't understand what normal Americans believe, or why. They just don't "get it."

[68skylark]

Great -- so you have some ideas about a system that's better than capitalism, in order to save America from all that troublesome wealth we have.

[Mr. Jeeves]

Capitalism needs a soul. Without one it is just another machine that ignores humanity.

I'm as much an uber-capitalist as you are likely to find, but I don't disagree with that at all. Right action leads to far greater long-term success - the danger is short-term thinking. Grabbing for the goal today with no thought of tomorrow is like eating seed-corn. And unfortunately, it's an epidemic among the Fortune 500 these days. :(

[junta]

"Capitalism" is just another ism that will kill us slowly, like choking on a cheap made in China plastic gee gaw.

[ConservativeMind]

Free markets may not be the most ideal to address a problem in the short term, but in the long term, they are the only viable way.

There will always be short-term "inequities". But this is where individuals, willing to risk and put forth effort, can provide much needed products and services while making the money they so richly deserve.

[facedown]

"To make a whole person, we don't have to do it all in the economics classroom." Allan Meltzer

True. Part of it is done in the gym.

[farlander]

Like what ? Inserting liquidity into the system ?

[DManA]

Capitalism and liberal government is a vessel into which people are free to pour what ever values they see fit. If people pour shallow consumerism into it it isn't capitalism's fault. It's individual people's fault.

it's producing a value-free society

[muir_redwoods]

Yes, Just what the spiritually impoverished people of America needs is someone to manage our economy. That'll fix everything. And I'll bet Mr. Foley knows just who is most qualified for the job.

[A. Pole]

it isn't capitalism's fault. It's individual people's fault.

Capitalism/economy/"free" market is what people do. It is not an objective self-sustaining entity. Free Market Fundamentalism is not much better than Islamism, Feminism, Bolshevism or National Socialism.

[A. Pole]

Yes, Just what the spiritually impoverished people of America needs is someone to manage our economy.

US economy is ALREADY being managed as EVERY other economy is, was and ALWAYS will be.

The problem is when it is being managed in the name of a false theory like Free Market or Bolshevism.

[LowCountryJoe]

Interestingly, Foley writes a book about his opinions of the mysterious thing we call the market -- the aggregate behaviors, preferences, scarcity, and constraints that exists by/for millions of individual people who make up this so-called market so that they can ultimately maximize their satisfaction -- and peddles this book, where else? In the marketplace!

Fortunately, consumers have choices because of this "market" and since I have read far more interesting books from people that are more wise and enlightened than Foley, I'll save my money for a purchase on something else than this populist drivel from an economic "knownothing".

[muir_redwoods]

Free markets a false theory?

You remind me of the definition of an economist: One who wonders if something that works well in practice will work in theory

[aquila48]

"Adam Smith also wrote a book on morals." Allan Meltzer

Yes and it's as great a book as "The Wealth of Nations" - it's "The Theory of Moral Sentiments"

http://www.amazon.com/gp/product/customer-reviews/0865970122/ref=cm_cr_dp_pt/104-5680273-4891101?ie=UTF8&n=283155&s=books