What explains economists’ raptures?

supply and demand chart
Economists’ esoteric truth

THE SIMPLE PHILOSOPHICAL distinction between materialism and idealism is a handy way to understand how neoclassical economists came to worship the price mechanism as God. Here is Michael Symons’ essay on the topic, recently published in the online New Economy Journal under the heading, “Capitalism is idealism, perfected”

FOR MANY OF US, the market is an actual gathering of human buyers and sellers, chatting, tasting and sharing produce, which is often fresh and artisanal. At market benches and shop counters, people display and take in a community meal.

Mainstream economists turned that market into differential equations. In so doing, they perfected the idealism of capitalism. That is a big problem.

Idealism puts some high authority in charge of ordinary lives. The ancient Greek philosopher, Plato, claimed to glimpse the “world of forms” that shaped our inferior version.

Market capitalism directs human-beings through numbers, from higher interest rates to a supermarket saving of 60 cents.

Often perversely labelled “materialism”, the financial heights remake the world. Seemingly inevitably, profit and loss impose their rarefied rule. Of indisputable rationality, the price mechanism is God.

The promise is that, strictly obeyed, money will multiply eternally – cynically called “growth”, because it actually destroys growing things, from the heating biosphere to koalas without habitats.

Money is weightless, but a fierce enforcer that accumulates through heartless extraction, most efficiently from those with less.

It’s the most rationalised value system conceivable – valuing something not for being ethical, beautiful or tasty, but purely by price.

Every nonreflex action is taken to obtain or increase value in some sense; otherwise, no action takes place

– Investopedia explains

Many capitalist apologists pretend to being hard-nosed dealers in the grubby arts. Yet they worship an entirely spiritual desire, called “greed”.

The distinction between idealism and materialism is that the former sees the world as run by higher thoughts, and the latter by material fundamentals.

Idealists teach that actual bodies and everyday practices become misleading diversions, and materialists emphasise the provisional nature of ideas.

As a meal-lover, I fear that idealism is far too dangerously easy to adopt, unthinkingly. Proclaimed truths mould our minds.

Open-minded protagonists, on either side, allow that both rational thought and natural forces play big roles. The difference comes from which holds more sway. Do ideas come “from above” or “from below”?

A greater appreciation of the distinction should help to understand, and combat, the dictatorship of money. Does money run us, or do we keep it as an occasionally handy instrument?

I don’t propose some anarchic or hermitic refusal of money. Money is not without its uses, but only when clearly kept as a tool – as a community exchange system, and as a funder of cooperative endeavour.

Nonetheless, in moving towards a radical political economy, the plan is to regenerate care and consideration from below. Great schemes are built from the ground-up. Ordinary, everyday actions generate democratic supervision of political expenditures, programs and safeguards.

This is liberal “radicalism”, which does not mean extremism, but arguing from material basics… it literally gets to the root (Latin, radix) of the matter.

Materialists play close attention to commonplace sensations and activities. These “little things” are slighted as “trivial” from lofty vantage-points. Up-close, they are highly significant, and they multiply across human experience. The deterioration of relations with China, the rise of the FTSE 100, or some militant action might seem “important”, but only from its emergence from, and continuing connection with, everyday realities.

That’s to uphold the benefit of gardening, cooking and eating together. Community gardens and food rescue schemes are acknowledged actions of a “new economy”.

My latest book, Meals Matter: A Radical Economics Through Gastronomy, explores how a cluster of actual economies puts food on the table. There is no single “the economy”, but bodily, domestic, market, political and natural economies.

Capitalism simplified and up-ended that, diminishing basic human needs, with unhappy results. Instead of being guided by appetites, we were instructed to pursue ever-receding gain. Instead of cooperating through meals, we were to compete for dollars, euros, yuan and yen.

Radical arguments “from below” return to “the simple fact, hitherto concealed by an overgrowth of ideology, that mankind must first of all eat, drink, and have shelter and clothing”, to cite Friedrich Engels (at Karl Marx’s graveside, 17 March, 1883). Likewise, in a lengthy introductory section to Wealth of Nations (1776), Adam Smith launched modern economics with the claim that, through the “co-operation and assistance of great multitudes”, such as the butcher, brewer, and baker, “we expect our dinner”.

Too often, higher authorities have exploited, distorted, and suppressed gastronomic knowledge. The historical materialism of Marx and Engels turned into a narrow class war over the ownership of “production”, which split ruler irrevocably from ruled.

Meanwhile, in the service of the mighty financial superstructure, modern economists transformed market exchanges of actual meat, beer and bread into the perfection of the price mechanism.

2 thoughts on “What explains economists’ raptures?

  1. According to Adam Smith, who became increasingly enraptured as he worked through The Wealth of Nations (1776), the capitalist, intending “only his own gain”, is “led by an invisible hand to promote an end which is no part of his intention,” frequently promoting society’s interest effectively and unintentionally. Smith also backed the capitalist’s judgement over that of “any statesman or lawgiver”.

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