How valid is the so-called "Invisible Hand"?

Ray, I'm not quite certain what you mean by your observation. Will you restate it for us?

Hi, Luscious lips Letty. xxxxx

Oh, my goodness. There's Mathos of the delightful flattery. Hi, honey. I was hoping our Ray would explain The Invisible Hand.

(Mathos, you keep your hands where I can see them )

Hey Letty-tell him about your radio station.I think he is a romantic.He can serenade you.

spendius, I suspect Mathos knows about WA2K radio, as does Ray.

Ray, where are you, buddy?

I'm here Letty. I'll restate what I mean.

In laissez-faire people are expected to benefit each other even though their intentions are toward self-interest. Adam Smith calls this the invisible hand. However, in reality, people who are only considering their interest, would try to cheat the other person out. It is also a fact, that a selfish person with power would utilize his or her position to wrongly obtain what he or she wants. A person bent toward selfish ideals would not help the poor when they can. Also, the great depression was caused by uncontrolled speculation.

Thus, I don't see how anyone can justify the laissez-faire ideal.

Look up the word "projection."

I think I understand what you mean, Ray. In other words, "hands off" by the government is simply another way of saying deregulating. That policy was supposed to increase competition and thus benefit the average spender, when in fact, it has not worked out as Adam Smith (economist, right) projected.

During the great depression, folks in the stock market did some wild speculating on borrowed money, with no margin, and when the bubble burst; banks closed; durable goods were left sitting in the warehouse and all was NOT well with the world.

I think it's called Karma...

Ray-

You can't justify or not justify a system until you see how it works out.

Look at all the great works of art we gawp at and all done under absolute monarchs and dictators who ruthlessly crushed the workers.

If we make 400 years from here they'll only look at our great achievements.

Henry Miller said something very striking on the matter.

But the US with its capitalistic system is strong, whereas the Soviet Union imploded. Doesn't this, and other similar examples not hard to come up with, suggest that capitalism works?

Plunder and rapine works well, too, if there is not force strong enough to resist--that hardly recommends such a system for consideration as a civilized means of assuring one's prosperity. Given that the proposition for the superiority of a democratic republic is to produce the greatest good for the greatest number, it is by no means certain that the plutocratic capitalism currently favored by government works in that regard.

Oh, yes, well you would bring that up!

Nasty habit of mine, always suggesting something silly like economic justice . . .

Brandon interjected-

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What does that add to anything.

When the shuttle looked in a bit of trouble there was talk of Russia rescuing the crew.That doesn't sound like they have imploded.

I'm not saying I'm against a mediated version of capitalism, but I am against the extremes at both economical spectrum where on one side you have a total laissez-faire policy where the rich get richer and the poor get poorer, and on the other side you have complete control by a government whose interest is questionable, and whose control restricts individual from certain respectable professions they would want.

The economies of most first-world countries today are mixed, and I think that's how it should be. Opponents against systems that promote welfare for the poor and needy may argue that the government is holding the masses from being rich but the truth in my opinion is that the rich is usually holding a portion of the poor from leading a good and normal life and in most cases in history, it is a small portion of people that are rich. One might also argue that it is a "waste" of taxpayer's money, but as it is for a noble cause that would benefit people I don't see it as a waste. Objections such as the ones presented are selfish.



I don't quite agree, as I don't think any form of artwork is any compensation for the lives oppressed and lost during the time of brutal dictatorships and monarchs.



The great depression would have lasted longer if it had not been for world war II, and it would have probably been worse if Hoover was still in presidency with the ideal of a laissez-faire system.

As Setanta has mentioned (I hope this is what he means), monarchies and dictatorships with imperialistic policies would fare well also, but this does not translate to something good for the people.

One question about the USSR's collapse. What was the main reason for it?

Let me see if I can get this straight, Ray. Are we talking about "hands off" by the government in the matter of economics? I seemed to have missed something here. Capitalism is a wonderful system if it WORKS. The point is, it is NOT working.

It need some controls.

You need paper, so I build a paper mill. Now, the invisible hand (enlightened self-interest) is suddenly providing jobs for plant workers, lumbermen, shippers, retailers of paper products, and a whole host of others. It was not my desire to build the plant, nor to pay wages. My desire was to acquire your money. The invisible hand is providing the rest.


The questions arise when the hand does not address the awful stench produced by an unchecked paper mill. Nor water pollution and the long term effects of some logging practices. Self interest is not always accompanied by the word enlightened, in other words.

Yeah, that's basically what I meant.



Adam Smith in his other book about ethics, state his support of sympathy. I think maybe he thinks that sympathy should be a part of a person's interest?

I've never been a fan of self-interest, and I despise Rand's erroneous claim that it's "rational."