War Handwavium

I was looking at this book:

http://www.amazon.com/exec/obidos/ASIN/0060598999

via Boing Boing

And the byline I imagined was this:

“The Invisible Hand of Capitalism has Hairy Palms”

The book itself isn’t about war handwavium but it is about economic handwavium, and the book appears to address the handwavium directly. And anything that helps people become aware of how language is used to misdescribe reality is a good thing.

The “Invisible Hand” was a metaphor created by Adam Smith in “The Wealth of Nations”, written in 1776. Smith used the term “invisible hand” once in the entire book, when he was discussing how capitalists in one country would be kept from moving their capital out of the country to another country where the labor was cheaper. Smith said an “invisible hand” of their own nationalistic interests will compel them to support their home country, and thereby strengthen the country that they live in.

The idea of the “Invisible Hand” has come to mean that if you do not have government regulation of markets, that this “invisible hand” of self interests will spontaneously emerge some higher order of organization better than any regulated market possibly could.

What is funny is how the current issue of “oursourcing” jobs to foreign countries where labor is cheaper essentially proves that capitalists don’t care for their country and only care for their profits, essentially disproving Smith’s one and only use of the term “invisible hand”. And yet, laissez-faire idealogues not only continue to push the concept of “invisible hand”, but push it far beyond the very limited sense that Adam Smith had used it.

The “Invisible Hand” is pure economic handwavium. And given how it is driven purely by self-interest and self-satisfaction, on some level it qualifies as a kind of masturbation. While there’s nothing wrong with laissez-faire capitalists masturbating themselves with fantasies of spontaneous emergence, it’s pure fantasy and certainly doesn’t qualify as any sort of real-world relationship required for a monetary transaction between separate individuals in an economy.

When you hear “invisible hand of capitalism”, you should immediately imagine some laissez-faire capitalists masturbating to some economiic porno with “Bow chicka bow wow” replaced with “cha-ching cha-ching”.