Monday, October 4, 2010

Halloween Horror Special I: I Do Believe in Spooks!

Bert Lahr as the Cowardly Lion in the 1939 film version of The Wizard of Oz had some of the best lines in the film. Note that I said some, not all, or even a majority. This is appropriate, given the fact that the 1939 version was the first sound adaptation of Baum's children's classic. There were a number of other versions of the story, some made under the direct supervision of L. Frank Baum; the 1908 version, unfortunately lost, was the first film believed to have had a musical score composed especially for a film. There was also one, considered "the worst adaptation of a book to the screen in history," that starred Dorothy Dwan as a flapper Dorothy and featured Oliver Hardy as a horrifyingly miscast Tin Woodman. Ms. Dwan, a talented actress, was married to the director, while Hardy was under contract. You knew there had to be some reason for such a cinematic abomination.

This demonstrates just how badly people can misunderstand or redefine a classic, whether in children's literature or economic theory. A case in point is the review of Adam Smith's The Wealth of Nations in today's Wall Street Journal ("A Wealth of Ideas: Review of Adam Smith: An Enlightened Life, by Nicholas Phillipson," WSJ, 10/04/10, A23). The review is quite rightly very positive toward Smith's work as presented in The Theory of Moral Sentiments (1759) and The Wealth of Nations (1776). Smith is lauded for his stand on limited government, free markets, liberty, so on, so forth — the usual suspects in the Vast Right Wing Conspiracy.

We agree with all this, making the omission in the book about Smith, and the review about the book about Smith all the more irritating. It's a little like planning a birthday party and leaving out the ice cream and cake. Smith's economic theories are built on a foundation of Say's Law of Markets. The (in)famous "invisible hand" is, in fact, an application of the principles underpinning Say's Law of Markets, as can readily be seen from reading the description in Moral Sentiments and The Wealth of Nations.

That is, according to Adam Smith, a free market economy operates because the rich cannot satisfy their wants and needs without employing the poor (purchasing the labor of the poor directly) or purchasing their productions produced by means of the labor of the poor. In accordance with what would become known as Say's Law, the rich trade their productions for the productions of the poor. In this way, the rich are "led by an invisible hand" to distribute their wealth equitably throughout society, despite their "selfishness and rapacity" (Moral Sentiments) or "self interest" (Wealth of Nations).

Unfortunately, far too many people today — ironically, both those who praise Smith and those who condemn him — assume that mere "self interest" (or "selfishness and rapacity," if you want to use Smith's earlier terminology) is sufficient for the invisible hand to operate. Both the pro- and anti-Smithians neglect to take Smith's full analysis into account — which, not surprisingly, leads directly into Moulton's prescription for economic recovery: production and employment. People must produce in order to generate the effective demand necessary to create jobs naturally, and neither government rapacity nor private selfishness is going to get things going again. The only thing that will work is to restore the operation of Say's Law of Markets by producing marketable goods and services and employing people to produce them, not just try and rely on a half-understood cause of the functioning of Say's Law, or bailouts and subsidies of companies that don't produce anything except speculative profits in the stock market.

Still, nobody seems to be catching on. People seem to assume that throwing money at the problem will fix it, rather than merely enrich those who happen to have larger catchers' mitts than others. Yes, they are exercising their self-interest (and their selfishness and rapacity, if you will), but it isn't producing any marketable goods or services, and nobody even seems to think it's necessary. Somehow the invisible hand will work, but nobody knows how . . . .

In effect, supporters of the invisible hand are put into the position of the Cowardly Lion when faced with something unknown, unseen, and evidently overpowering. All they can do is chant, over and over, "I do believe in spooks! I do believe in spooks! I do believe in spooks! I do, I do, I do! I do! I do!"

Happy Halloween minus 27 and counting.  Boo.



nail-in-the-wall said...

Back at ya: Boo !

Now didn't the Cowardly Lion need "Courage" which comes from wisdom and confidence?

On Wisdom by;
* * *

Adam Smith - 1759; The Theory of Moral Sentiments

Part I, Section III
Chap. III: Of the corruption of our moral sentiments, which is occasioned by this disposition to admire the rich and the great, and to despise or neglect persons of poor and mean condition

This disposition to admire, and almost to worship, the rich and the powerful, and to despise, or, at least, to neglect persons of poor and mean condition, though necessary both to establish and to maintain the distinction of ranks and the order of society, is, at the same time, the great and most universal cause of the corruption of our moral sentiments. That wealth and greatness are often regarded with the respect and admiration which are due only to wisdom and virtue; and that the contempt, of which vice and folly are the only proper objects, is often most unjustly bestowed upon poverty and weakness, has been the complaint of moralists in all ages.

We desire both to be respectable and to be respected. We dread both to be contemptible and to be contemned. But, upon coming into the world, we soon find that wisdom and virtue are by no means the sole objects of respect; nor vice and folly, of contempt. We frequently see the respectful attentions of the world more strongly directed towards the rich and the great, than towards the wise and the virtuous. We see frequently the vices and follies of the powerful much less despised than the poverty and weakness of the innocent. To deserve, to acquire, and to enjoy the respect and admiration of mankind, are the great objects of ambition and emulation. Two different roads are presented to us, equally leading to the attainment of this so much desired object; the one, by the study of wisdom and the practice of virtue; the other, by the acquisition of wealth and greatness. Two different characters are presented to our emulation; the one, of proud ambition and ostentatious avidity. the other, of humble modesty and equitable justice.

Have the courage to put 'Wisdom' Back In - PWBI

Cowardly Lion: "Courage! What makes a king out of a slave? Courage! What makes the flag on the mast to wave? Courage! What makes the elephant charge his tusk in the misty mist, or the dusky dusk? What makes the muskrat guard his musk? Courage! What makes the sphinx the seventh wonder? Courage! What makes the dawn come up like thunder? Courage! What makes the Hottentot so hot? What puts the "ape" in apricot? What have they got that I ain't got?"

Tin man & Scarecrow: "Courage!"

Cowardly Lion; "You can say that again."

What makes every citizen an owner? Courage! The kind of courage to Rally at the Fed. on April 15, 2011, to Pass Capital Homesteading by 2012. That kind of Courage!.

It's a nightmare out there so bring some courage and a bit of Adam Smith's Wisdom.

Guy C. Stevenson

God's Justice is Jesus in Person.

There is a Just Third Way. If you want peace, work for justice.

Start with justice.

nail-in-the-wall said...

Again Posted (HERE) and (HERE)

nail-in-the-wall said...

For the Cowardly Lion

On Courage:

"One man with courage makes a majority." - Andrew Jackson

"Courage is rightly esteemed the first of human qualities... because it is the quality which guarantees all others." - Winston Churchill

"Take time to deliberate, but when the time for action has arrived, stop thinking and go in." - Napoleon Bonaparte

"It's not the size of the dog in the fight, it's the size of the fight in the dog." - Mark Twain

"The people who get on in this world are the people who get up and look for the circumstances they want and if they can't find them, make them." - George Bernard Shaw

"Socialism takes no courage,..
Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy, its inherent virtue is the equal sharing of misery." - Winston Churchill

1. Courage. Overcome fear to test your ideas with others or to raise questions about ideas you don't fully understand. - CESJ Code of Ethics