Klavan, Smith and Friedman On Crony Capitalism

Wednesday, November 28, AD 2012

Ah the next four years are going to be so enjoyable.  When it comes to crony capitalism Adam Smith said it well:

“The proposal of any new law or regulation of commerce which comes from this order [that is, ‘those who live by profit’], ought always to be listened to with great precaution, and ought never to be adopted till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it.”

Milton Friedman was eloquent on the subject of government supporting private enterprises:

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2 Responses to Klavan, Smith and Friedman On Crony Capitalism

  • This adminstration will serve as an example for generations to come of the havoc that can be wreaked on an economy through government folly.

    Just to point out the principal promoters of crony capitalism (Barack Obama, James Johnson, Franklin Raines, Jamie Gorelick, Steven Chu, and Timothy Geithner) include not one civil servant. The legal profession, academe, the PR biz, and that weird netherworld where everything seems to run on connections produced this crew.

  • Oh, cannot forget Barney Frank (who has not had a normal job since 1968) and his boi, Herb Moses.

The Prudential Science

Wednesday, August 5, AD 2009

I ran into this quote going through an old EconTalk the other day, and thought it interesting:

As economists, we’re specialists in prudence only.

That, as you say, is not what Adam Smith recommended. Not at all. I and a number of other people would like to get back to a Smithian economics, which although it didn’t throw away the very numerous insights that we get from thinking of people as maximizers — maximizers in this narrow sense — acknowledges that temperence and justice and love and courage and hope and faith can change the way the economy works.

UIC Economist, Deirdre McCloskey

I’m trying to decide if I agree with it or not. I would certainly agree that economics basically only looks at certain prudential concerns, it doesn’t consider humanistic or theological questions. However, I’m not sure if economics should acknowledge those concerns, or if it is more the case that economists (and others dealing with the field) should clearly acknowledge that there is much more to any question than the question of what is most economically efficient.

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10 Responses to The Prudential Science

  • Do one thing well or many things badly. That’s often the choice we face.

  • I’m not clear that there is a need for (or indeed that there can be) a “Christian Economics” so much as that economists should be Christian.

    My feelings exactly.

  • I think you have answered your own post rather effectively when you bring it full circle to the idea of economists as Christians and not the other way around.

    The very concept of a dichotomy in science between a Christian and secular reality is absurd. The pursuit and measure of science has to be the preciseness with which it conforms to and describes the reality which it seeks to know. And as a corollary, the scientifc accuracy of knowledge is not a function of theology.

    It is self-serving and disingenious of McClowsky to talk about prudence without recognizing that prudence, like any virtue, depends on the underlying theological/philosophical base from which it takes meaning.

  • In what respect can “Economics” be called a science? In physics and the physical sciences, things are discussed in terms of measure, weight and number: the whole of related physical things which is the universe.

    Newman called science an organized body of knowledge. But then one must agree rigidly on terms.

    What can economics do with, for example, taste [about which there is no disputing] when it comes to eating cake, or fashion in clothes. What can it do about the weather, which is so important in agriculture? J.K. Galbraith, son of a farmer, answered simply: there is no real economics of agriculture, as the Soviets discovered.

  • Gabriel,

    It is scientific inasmuch as a disorganized approach to the economy is not helpful.

  • It is science in terms of that which be evaluated based on a cause and effect relationship.

  • # j. christian Says Wednesday, August 5, 2009 A.D. at 5:45 pm
    “It is scientific inasmuch as a disorganized approach to the economy is not helpful”.

    # PDiddy Says Wednesday, August 5, 2009 A.D. at 6:38 pm
    “It is science in terms of that which be evaluated based on a cause and effect relationship”.

    These are not much by way of definition of the nature of science. The first is merely negative. The second raises the issue of whether cause and effect can be clearly and rigidly defined.
    And then there is the question of defining what is meant by”the economy”. What does it include, what exclude?

  • Just out of curiosity, Gabriel, how much have you studied economics? It’s hard to tell what you’re getting at it without knowing where you’re coming from.

  • j. christian Says Thursday, August 6, 2009 A.D. at 12:25 pm
    “Just out of curiosity, Gabriel, how much have you studied economics? It’s hard to tell what you’re getting at it without knowing where you’re coming from”.

    When someone defines economics, I will learn how much I have studied. [Would Keynes’ GENERAL THEORY count?].

    I note, if you will forgive my saying, that you, perhaps unconsciously, resort to an attempt to reduce the discussion to a personal matter. It seems to be an increasing malady these days. “That’s just your opinion”. It is like the malignant studies of “the influence of XYZ on ABC”.

    I am reminded of our schoolyard insult “Your mother wears army boots”.

  • DC, regarding your comment on science more generally, I’d propose that one of the “meta” problems of contemporary science is the methodological denial of formal & final causality (to the detriment of science). While natural science may not be able to formally address those forms of causality, it ought not proceed as if they did not exist.