Economics

For many years, economists have been convinced that their discipline is a  scientific  one. That is, it relies solely on the disinterested mathematical formulations of the discipline itself and is therefore free from any moral, theological or cultural baggage. The thesis of the work under review is that this freedom is a myth the economic theology of all modern economists is that economics has no moral baggage and is purely a positivist approach to all things economics. What this myth does is ultimately blind those who both study economic life as well as live within  its nexus to the real condition of their society and their selves.   
    The  Adam  in the title refers to Adam Smith, the founder of what might be called systematic economics. Adam Smith systematized a much older notion concerning the personal and the social interest. The basic and simplified premise here is that this gap has been closed in that, under free competition, the person who seeks his self interest (financially speaking) will, in his need to convince consumers to use his services, be as pleasant and civilized as possible. Under free competition, the sins of personal greed are wiped away in social utility in the drive to gain profits and market-share, even the most selfish human being will act in the best manner possible so as to attract as many customers as possible. The real argument that Foley makes, however, is that this is a myth, and there is no real evidence that economic activity works out this way.
    Therefore, by the time one finishes the work, two stark propositions stand out First, that all economic activity is based around some idea of the good, some moral assumptions that serve to canalize economic life. Secondly, that the capitalist system worldwide cannot be called a  progressive  system, and in fact, cannot be seen as a system at all. Its results have been too uneven for that (227).
    More specifically, the main problem with capitalism is the huge gaps that exist among rich and poor states, as well as rich and poor classes within states. The rise of the bourgeois, the middle classes, sought to, so to speak, justify their actions through holding that their work was the  natural  mode of economic production and sought free markets for their trading activities (150-151). One of the central insights here is that this gradual  scientification  of economics serves largely as a cover that hides the real evil of class society, and that capitalist relations have no mechanism for equalizing (more or less) economic reward.
    While in the 1860s until the great depression, economics became a science, a science centered around self interest and its resultant social utility. The same can even be said of the Marxists, since, speaking simply, the self interest of the working class clashes with the self interest of the propertied class. This clash of self interest will lead, eventually, to a socialist society (133ff). In terms of economic growth, both the socialist and capitalist models are more or less equal, as the USSR, despite all its totalitarianism, modernized itself in a very short time. Both socialism and capitalism remain very unpredictable systems of production. The bias of the marginalist economists here is that all forms of economic life can be modeled, and economic science is thus dependent on these models. But models assume a regularity and a process of these systems that just is not present (157).
    Expanding the authors thesis then a little bit, the real question is the regularity of any economic system based on the transference of ego to social good.  The argument is that the models used by modern economists are in fact assumptions about how things should work, or even more amorphous, attitudes about the economic system that the economist wants to see adopted. What is easy to miss in this large work is that the real issues concern systematizing economic life and modeling it. Foley holds that it cannot be done, and the nature of modeling economic life has more to do with the biases of the writer than the actual way people think about economic life.
    All of this then comes down to the following issue if economic life is truly amoral, and yet few advocate pure amorality for all social life, then one is left with the very difficult and problematic situation where economic life stands in stark contrast to what the great majority of people hold to be socially moral action. In other words, while most hold to some version of social ethics, this ethic quickly dissipates as soon as one begins speaking of economics. Economics is the science of the ego, and a science that holds that the ego should be as unrestrained as possible (at least according to the SmithRicardo thesis). But who holds to this in all other areas of social action This is the problem. Economics seems to get a free pass in the moral realm that is not given to any other form of social action (32-33).
    The bulk of the work, despite its historical character, is exploring this contradiction. No economist of note since Smith has held anything else than the idea of personal interest, whether this be the isolated ego or the state or the class. Hence, all economic theory has this one problem in common   it seeks to understand, not control, the unfettered will. But in its more famous application to market economics, the assumption is that such unfettered wills will eventually lead to a stable equilibrium among production, demand and prices. What Foley argues is that there is no real basis for this assumption and again, it is based on faith. In the 20th century, socialism as an alternative mode of modernization has swept large portions of the globe, especially in the third world. The economic success of statist systems as Hitlers Germany of Stalins Russia, coming on the heels of the Depression began to worry people about the stability of the capitalist idea. The depressions and panics from the 1860s onward strongly suggested that the models of the marginalist economists were wrong, and there was no long term stability to be had in the capitalist system. Even more, it was also the case that the state had proven itself as worthy in the economic arena as the corporation had. The real force of mystification however, remained self-interest. The pursuit of self interest seems to negate any serious examination of the social whole (112 and 158). What developed in its place was a sense that one needed to accept current evils that will eventually be adjusted for in the future. Hence, the providential role of the self regulating economy became an object of faith, but an object that served to blind those to the condition of their own society.
    To reduce economic life to that of a  hard science  was the real move of the 20th century discipline. But this  hard science  served only the ideological needs of advanced capitalism. It sought to ignore moral concerns by holding that the current structure of economic relationships were a part of the self regulating whole. Nevertheless, the state was always called in to regulate many aspects of the economy throughout this period, throwing doubt onto the  self regulating  claims of what we now call the  neo-classicists.  Historically, from the destruction of the nobility to the centralization of state power over a large area, the state has been a central actor in the free market, a historical fact that modular economics continues to deny. The state is not the enemy of the free market, but is the enabler of the free market. It is the state that enforces contrasts, that has created the conditions for the market to develop and it is the state that destroyed the old enemies of the middle class, urban order. Today, the state is inherently part of the economy, seeking regulation in order to show some mercy to the poor. In a startling section, Foley quotes both Malthus and Ricardo as they sought to force the poor into an early death so they did not reproduce. This reproduction would have been economically inefficient, and hence, their deaths were a good things. Both Malthus and Ricardo opposed all poor laws of any kind, on the grounds that the poor, though who failed the struggle for economic survival, should be permitted to starve and freeze so that they would not flood the market with unskilled labor (84-85).
    This work is certainly worth reading. It is refreshing to see economics not shown as a cold, calculating series of equations and software programs. Economics is really about a moral attitude towards life. It is a philosophical discipline as much as it is a scientific one. It is part of the moral fabric of society for better or worse. There is no reason to hold that an institutionalized amorality in economics will not bleed into other areas of life such as the church, family life or respect for elders. Ego-centrism in economics has become a part of all areas of life, leading to disastrous results. The ego is the only real end in modern societies, which for Foley, comes from the utilitarian biases of economics as a discipline. The moral problems of capitalism will remain as long as the system goes from boom to bust, destroys the environment (in certain cases) and maintains a tiny class of billionaires. There is nothing systematic about capitalism   it is, as Hayek described, the mere clashing of interests. Clashing egos is the wellspring of progress (206). But is the clashing of egos creating progress in the family, or in poetry This becomes a problem. Does the clashing of ego serve to justify the control of the majority of social wealth by a handful of powerful families and firms