Arnold Kling  

Charles Darwin and Adam Smith

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Today, generally, Adam Smith is claimed by the Right, Darwin by the Left. In the American South and Midwest, where Smith's individualist, libertarian, small-government philosophy is all the rage, Darwin is reviled for his contradiction of creation. Yet if the market needs no central planner, why should life need an intelligent designer? Conversely, in the average European biology laboratory you will find fervent believers in the individualist, emergent, decentralised properties of genomes who prefer dirigiste determinism to bring order to the economy.
That is Matt Ridley. I could quibble with his caricature of American conservatives, but I think his larger point is valid. In any case, there is much more in the essay. Read the whole thing.

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COMMENTS (21 to date)
david writes:

But biologists are often central planners. Oh hey look, biodiversity over there is collapsing due to some newly-evolved disease. Let's go intervene. In Klingspeak: we technocrats know how to tweak the ecosystem better than Nature does.

In any case I would caution being too enthusiastic about comparing biological evolution with market evolution. Biological evolution is messy and violent and often horrifying - after all, it relies on the unfit meeting assorted horrible ends, at least sooner than the fit do. If an accurate parallel to economics existed, everyone would be a statist.

PeterW writes:

Of course those selfsame left-wingers go into hysterics if you ever suggest that Darwinian forces could create any group differences among humans. Liberals are creationist too, just on a different timescale.

fundamentalist writes:

Ridley: “Yet if the market needs no central planner, why should life need an intelligent designer?”

The parallel between evolution and free markets breaks down because free markets are intelligently designed. Evolution is pure chance, nothing but a roll of the dice. Markets are designed by people, sometimes thought of as intelligent life forms. The difference between central planning and free markets is not the dichotomy between intelligent design and chance, but between design and planning by a small group or a large group. The genius of the free market is not that it is unplanned, but as Hayek wrote, it is planned by millions of people, all contributing specialized knowledge that no central planner could possess, even if he is President Obama.

Ridley: “The social Darwinists of the 19th century and the eugenicists of the 20th were of the view that the strong should therefore be encouraged to succeed, the better to keep natural selection going. But this is to misread human society. The human body may have come about through three billion years of natural selection among genes, but civilisation and prosperity came from 50,000 years of much more rapid natural selection among ideas.”

Actually, prosperity came about with the advent of capitalism in the 16th century. Several works on economic history demonstrate that standards of living changed very little from the days of the pharaohs until the 17th century; some would say the 18th century. The evolution of ideas had nothing to do with it. Capitalism exploded onto the scene in Western Europe with almost no ancestry.

As for eugenicists desiring to keep natural selection going, Ridley’s comment that they “misread human society” is wrong. Eugenicists and 19th century Darwinists thought they had discovered a higher “morality” than the old Christian one that would keep alive those harmful to future generations. It was a natural and logical conclusion to the assumptions of Darwinism. People rebelled against it because of their lingering Christian morality, not because it wasn’t logical or scientific, as Ben Stein demonstrated in his film “Expelled: No Intelligence Allowed”.

Ridley: “Even sophisticated, entropy-defying complex systems are subject to the weather-like vagaries of mathematical chaos — and there Darwin cannot help.”

Ridley assumes that economies are as random as the weather. Of course, the weather isn’t random; we just don’t understand the physics and so can’t predict how weather will develop. Weather is controlled by physical laws beyond our control and if we knew them well enough we could predict weather as accurately as we predict the movements of the planets.

On the other hand, economies are not controlled by physical laws we know little about. Economies are man-made systems of organization controlled by people. We know people because people are us. We know how people think and react to a wide variety of phenomena. Mainstream econ can’t predict the humidity in a downpour, but that doesn’t mean economics is too complex a subject for anyone to understand. Mainstream econ can’t predict because it assumes economies are forces of nature. In Dr. Kling’s words, they assume it’s a matter of hydraulics. But if we take the approach that Austrian econ takes, and which Behavioral Econ takes, then the economy makes a lot of sense and becomes predicable. Then financial disaster become completely avoidable.

Troy Camplin writes:

I think Ridley is mostly right -- except with (some of) the libertarians. The Left believe that the natural universe -- physics, chemical systems, biological systems -- are spontaneous orders, but that the mind and the products of the mind/human interactions should be placed under central command. Religious conservatives believe that the natural universe was brought about by central command -- including the mind/soul -- but that the products of human interactions are spontaneous orders. Libertarians like Hayek, Frederick Turner, Stuart Kauffman, and myself all believe that all complex systems are spontaneous orders, whether less complex or more complex than, and including, the human brain.

El Presidente writes:

I would quibble with his caricature of Adam Smith.

The Theory of Moral Sentiments is Darwinian only if read with the previous suggestion and the greatest credulity, and Smith saw a vital role for regulators in Wealth of Nations as he expressed certainty of the tendency for businessmen to collude and for unconstrained free markets to run amok. He railed against foolishness, but I don’t recall him railing against sapience. Thus, in so far as we accept Ridley’s view of Smith, we must frame his words in terms of scale and scope, not collaboration or direction. The similarity between the two authors might be more along the lines of their appreciation for a force that they could not create in and of themselves and sincere wonder at the goodness of its power; a contagious sense of awe, humility, peace, and gratitude.

One needn't be a hypocrite to acknowledge that things can take a "natural" course if left alone and yet that we might very well prefer something "unnatural". Unless we are to claim that the "unnatural" preference is somehow fit for remediation while everything else should be left alone, then we haven't a leg to stand on in criticizing those who choose to adopt one basic set of principles for physical sciences and augment them with another for social sciences; the reason for this augmentation being the existence of sapience and with it moral agency. These are not physical forces. They are metaphysical forces. If we embrace a pursuit to eradicate societal instinct, are we not central planners of a different sort?

If evolution/natural selection is responsible for everything we experience, then choice matters not. Smith's admonitions should fall on deaf ears and not affect behavior one bit. Natural, physical, inhuman forces must then be to answer for war, theft, malice, plague, famine, and drought. They also deserve credit for everything we would claim as our own such as wealth, art, technology, and the affection we express toward those we claim to love. How juvenile of us to think that we have any choice in the matter of loving another individual, right? I prefer to think that I am not loving another person unless I choose to do so; that it requires my assent and I am a fool to withhold it. Then, I hope that I would give it as often as humanly possible, and that when I fail to give it they would be loved by someone else _in spite of me_. That’s how I can support societal approaches to economic policy that give consideration to others in excess of recognizing them as competitors for limited resources. That's how I can express reverence for the physical and the metaphysical in tandem without contradiction. I've studied Wealth of Nations and Theory of Moral Sentiments, and I don't think Smith would have a problem with this. Characterizing his work as physical reductionism is taking substantial interpretive and editorial liberty.

John Thacker writes:
Yet if the market needs no central planner, why should life need an intelligent designer?

But things in the free market succeed because they appeal to individual human choices. And companies and individuals don't randomly invent new products or buy new things; they evaluate them with intelligence. Organisms in general evolve randomly and are judged by an impersonal environment. The free market is more like the vague intelligent decision intuition of "evolution on the micro scale, but the really big decisions directed by at least something's planning." (And if you object that it's not one central planner but many small ones, then someone could say that different parts of intelligent design were directed by different angels, or something.)

The closest parallel in biology is cuter animals succeeding because they evolve in such a way that humans want to protect them and increase their number. I'm not entirely sure that people would call that natural selection in the same way, though. Some might.

John Thacker writes:

As a reducto ad absurdum, the cute animals thing eventually leads to a "animals evolved in such a way that humans would want to breed them," and then individual dog breeds become a result of natural selection, in a way.

Mike writes:

"As a reducto ad absurdum, the cute animals thing eventually leads to a "animals evolved in such a way that humans would want to breed them," and then individual dog breeds become a result of natural selection, in a way."

For that matter, anything humans do is natural as humans are of nature. Therefore, plastic is natural.

Joe writes:

Arnold,

This brings up a great "contradiction" in American Political Society. There is no true party who believes in freedom: Democrats are considered anti-market pro personal freedom.

Yet Republicans are pro Free Markets (in a comparative sense since both parties in the hold of big business) but then anti-personal freedoms (Gay Marriage?) (Except gun ownership).

People like me, who live in a major metropolitan city are forced to make trade offs between parties; Give up some economic (free market) freedom, or give up some personal freedom.

Why do so many libertarians allow their good ideas about freedom and liberty to be hijacked by republican and conservatives? Why do many seem willing to trade off the personal freedom part? What am I missing? Are there no true Libertarians? Just rich people who want to make sure the world does not change, so they grab the libertarian moniker and parade around for economic justice and small government, all the while trying to prevent people from living their lives to the fullest, and imposing untold death and destruction in overseas wars?

What Gives?

[Accidental typing of Arnold's name where the commenter's was supposed to be has been fixed.--Econlib Ed.]

Don the libertarian Democrat writes:

About Adam Smith:

"From Gavin Kennedy:

"That is a modern myth spread widely and repeatedly from the 1950s by modern economists (though it was earlier taught in the Chicago oral tradition from the 1930s). It was backdated to Adam Smith to give the myth high-level approval, as if he had made the metaphor of ‘an invisible hand’ a central theorem of his analysis of 18th century commercial markets (he never knew of ‘capitalism’, a word invented in English for the first time in 1854 – see Oxford English Dictionary).

Smith used the metaphor of ‘an invisible hand’ only three times in nearly a million words: once only in his Essay on Astronomy, written from 1744 to 1758, unpublished in his lifetime and published posthumously in 1795; once in Moral Sentiments, 1759; and once in Wealth Of Nations, 1776...."

What's hilarious to me, is that if I quote Smith, Friedman, or Hayek, without naming them ( I stopped doing this ), I often get told that I'm not a libertarian. As for Simons, Knight,and Fisher, who were once thought to be Free Market defenders, some commenters consider them Socialists.

But by far the worst situation arises with Edmund Burke. The popular perception of him is very off the mark. Ideologues claim him as a hero, even though he despised ideology.

As for Smith and Darwin, here's Kennedy again:

https://www.blogger.com/comment.g?blogID=11437041&postID=842421513700380107

[Long Gavin Kennedy quote--taken from http://adamsmithslostlegacy.com/2009/07/mythical-basis-for-theory.html --has been elided. Please do not quote in full material that appears elsewhere.--Econlib Ed.]

Zdeno writes:

I don't think it's ridiculous to theorize that domesticated animals have developed human-baby-like features to hijack our brain architecture that was designed to care for human babies. I wouldn't bet the farm on it, but why is it a Reductio ad Absurdum?

Also, I see Ridley's point with respect to evangelical Christians and whatnot, but his theory only holds if you characterize Conservatism in terms of the backwater redneck bible-thumping adherents, who are not true Scotsmen - sorry, Conservatives - but rather vote banks who serve the same purpose as the ACORN-mobilized ghettoes do for the Progressive movement.

When you look at the intellectual cores of Conservatism and Liberalism, I think you'll see that it is the Conservatives who have believed in the imperfectability of man, the necessity of rules and coercion to restrain our animalistic natures, and other consequences of humans being selfish replication machines at our core.

And let's not forget where the battle lines are drawn in the nature-nurture debate. it wasn't the Campus Young Republicans protesting EO Wilson in the 70's.

Finally, only on the fringiest of the right-wing fringe do we see anyone willing to admit that evolution didn't grind to a halt 40,000 years ago.

***

@Arnold

Short answer as to why Libertarianism has been spectacularly unsuccessful over the past century: There's no money in it.

Cheers,

Zdeno

E. Barandiaran writes:

Arnold,
You ask "What am I missing?" You (and all of us) are missing a few hundred pages. This is what it takes to present a coherent view of society, including a consistent glossary. Many take the shortcut of a few lines or a column to present their views on specific issues, and in the process to define words as convenient for their argument, but at best they score a few points in a political discussion. The alternative of relying on the authority of Darwin and Smith doesn't work either--by the time we finish the discussion about what they said, we'll be asking "and so what?".
I hope the two books you're now going to publish do provide a coherent view of society--of how social order emerges, why it may take different forms, and what the economic consequences of these forms may be. Then, and only then, we'll be able to have a serious conversation about ideologies and political parties.

Tom West writes:

I don't see any contradiction at all. If we look at evolution, it can quite happily create a species that evolves into a dead end and goes extinct while each step of its evolution is the "optimal for this species".

Evolution doesn't promise "success" (no matter what you choose to call success). It's a process that produces wonderful and occasionally dreadful (to those involved) outcomes.

A completely free market is much the same. A free market might easily dictate the death of millions, if certain economic circumstances occur even while it produces miracles elsewhere.

To my mind, evolution and the markets are there to be harnessed. They produce wonderful things, but they are not goals, only processes.

I think the analogy only holds if the left-wingers don't believe that the market is a process. And in that, there may be some truth. A surprisingly large number of people don't seem to acknowledge the existence of how markets work. And in that, they lose a powerful tool for use in the betterment of mankind.

Jim Glass writes:

Ridley has a perfectly fair point.

For the record, though, Darwin was much more influenced by Malthus than Smith, as he recounted...

"In October 1838, fifteen months after I had begun my systematic inquiry, I happened to read for amusement Malthus on Population, and being prepared to appreciate the struggle for existence which everywhere goes on, from long-continued observation of the habits of animals and plants, it at once struck me that under these circumstances favourable variations would tend to be preserved, and unfavourable ones to be destroyed. The result would be the formation of a new species."

Malthusian ideas generally are very more of "the left" (unsustainable population, resource exhaustion) -- although if the left actually read him, they might want to keep their distance.

None of this contradicts Ridley's point about today.

fundamentalist writes:

I like PJ O'Rourke's take on Smith's "invisible hand." O'Rourke says Smith meant nothing more than that unintended consequences follow every action. The state may intend good things, but bad usually follows. In a free market, a producer may intend to cheat people, but competition thwarts him and punishes him instead. Smith may have used the phrase very few times, but he used the concept it embodies frequently.

In addition to the reasons mentioned above for why evolution is a bad analogy for free markets, I don't think it's a good idea to equate free markets with evolution because it's bad PR. Evolution equals mass death. Species change as a result of mass death. Evolution is brutal, uncaring, and blind. Markets are the exact opposite. Competition in markets isn't the life and death struggle of the natural world. It's friendly competition, like sporting events. And the division of labor and trade make cooperation far more a hallmark of markets than brutal competition.

Comparing free markets to evolution is no way to win socialists over.

El Presidente writes:

fundamentalist,

Comparing free markets to evolution is no way to win socialists over.

You charmer. :-)

Joshua M. writes:

"Why do so many libertarians allow their good ideas about freedom and liberty to be hijacked by republican and conservatives?"

Joe,

I don't know how anyone can stop someone else from "hijacking" ideas. Ideas belong to everyone. To be sure, it's frustrating when someone like George W. Bush claims to be a defender of free markets or Cato publishes articles supporting statist, Republican policies using the "lesser of two evils" excuse. All I can do is try to be consistent in applying libertarian principles in my own life and in my interactions with others. You know, talk the talk and walk the walk.

It's difficult in the current environment of rabid partisanship to be heard sometimes, but all we can do is keep trying. My approach is to calmly and respectfully engage others and hope that, at the very least, I can demonstrate that not all libertarians are either closet-Republicans or people who just want drugs and prostitution legalized.

Dr. T writes:

Ridley's brush is too wide, and he's working on the wrong canvases. A left-right political spectrum is too simplistic and has nowhere for us libertarians (or conservatives, for that matter). The same is true with left-right economic beliefs.

Left-right economic beliefs correlate with but aren't fully correspondent with left-right political beliefs. (I know many people who are economically right-wing but socially left-wing.)

The correlation between belief in the theory of evolution and the left-right political spectrum is due to a subset of the religious right that believes in creationism. But, that subset is a small minority of the right-wingers: most people on the right wing of the political spectrum accept the theory of evolution. Since the vast majority of US citizens of all political views accept the theory of evolution, including it in these types of studies tells me that the study designers are biased against the political right wing.

I see little point to these comparisons. At best, they provide little information or insight. At worst, they lead to incorrect and/or biased conclusions and over-generalizations.

Tom West writes:

Since the vast majority of US citizens of all political views accept the theory of evolution

Don't we wish.

November 2004 Gallup poll

God created man pretty much in his present form at one time within the last 10,000 years: 44%

Man has developed over millions of years from less advanced forms of life, but God guided this process, including man's creation: 38%

Man has developed over millions of years from less advanced forms of life. God had no part in this process: 13%

RL writes:

Here are two possible explanations:

1. Most people on the Right don't really understand Darwin and most people on the Left don't really understand Smith.

2. Most people on the Right don't really understand Smith and most people on the Left don't really understand Darwin.

Please note these two explanations are not mutually exclusive...

axiomata writes:

Darwinian atheist is to anarcho capitalist as Creationist is to interventionist (and Deist is to Hayekian libertarian)

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