Monthly Archive for August, 2008

Adam Smith, Human Nature, Capitalism and Realism

Three of my holiday reading books put together came up with an interesting insight into human nature. The books were “The Genome” by Matt Ridley followed by “Confessions of an Economic Hit Man: The Shocking Story of How America Really Took Over the World” by John Perkins, then followed up with “On the Wealth of Nations” by P.J. O’Rourke.
(I did chuck in an Andy McNab from the library too ).
“The Genome” basically said that nature wins out over nurture a lot more than we realise.
“On The Wealth of Nations” has an Adam smith quote on human nature. From “Moral Sentiments”, part 3.
I quote “

Let us suppose that the great empire of China, with all its myriads of inhabitants, was suddenly swallowed up by an earthquake, and let us consider how a man of humanity in Europe, who had no sort of connexion with that part of the world, would be affected upon receiving intelligence of this dreadful calamity. He would, I imagine, first of all, express very strongly his sorrow for the misfortune of that unhappy people, he would make many melancholy reflections upon the precariousness of human life, and the vanity of all the labours of man, which could thus be annihilated in a moment. He would too, perhaps, if he was a man of speculation, enter into many reasonings concerning the effects which this disaster might produce upon the commerce of Europe, and the trade and business of the world in general. And when all this fine philosophy was over, when all these humane sentiments had been once fairly expressed, he would pursue his business or his pleasure, take his repose or his diversion, with the same ease and tranquillity, as if no such accident had happened. The most frivolous disaster which could befal himself would occasion a more real disturbance. If he was to lose his little finger to-morrow, he would not sleep to-night; but, provided he never saw them, he will snore with the most profound security over the ruin of a hundred millions of his brethren…”

(You can also find the text here ).

Interestingly, Adam Smith complains bitterly about big business, globalisation, poor government, feckless people and could have been writing for The Daily Mail today. In other words, nothing much changes. For that matter, the Romans also had pretty much the same list of complaints.

“Economics Hitman” for me documented the manifestation of our innate human nature as explained by the first two books.

In other words, economies, regimes, global businesses etc etc with all their imperfections, exploitation, unequal distribution of wealth, poverty etc etc are the way they are because that’s the way “We” want it.
By “We” I mean every one of us every time we make a purchasing decision solely with our wallets, and not with our heads as well.

A good example is Asda. My colleagues complain bitterly about globalisation, worker exploitation, lack of freedom etc. And where do they do their weekly shop ? Asda ! Why do they sacrifice their morals ? They do it for £20 per week.

Several TV programs I have watched go undercover into sweat shops in poor countries, then “blow the whistle” back home in Primark to happy shoppers there. Some of the shoppers even said outright, “if it’s the only way for me to get cheap clothes, then I don’t care about those poor people working 60 hrs a week”.

My take home from this is that Sir Bob Geldof and companions aren’t battling a system. They are battling against our very own inbuilt human nature of out of sight out of mind.

Sir Bob and friends have made a great attempt at putting these sights in front of us. But big business has more money to throw around to hide these sights, or at least lose them in amongst everything else.

Maybe they are trying to fix the symptoms of world poverty. Sir Bob, Bono, Bill Gates and friends maybe need to put some effort into finding another way to run our economies. A way that doesn’t put money first.

Answers on a postcard please :)