Searching for the Soul of Economics

By Gary Russell

An extended review of the book, "Being Consumed" by William Cavanaugh. It is intended not only to present Cavanaugh's analysis of the dysfunctions of contemporary society, and consumerism in particular. But it's subtitled "Building on Cavanaugh", meaning that it attempts to draw out some further implications inherent in (or at least consistent with) his core analysis. But in going beyond Cavanaugh, one must hasten to point out that he is not responsible in any manner for its content.

• Language: English
• Publisher: Gary Russell
• Release date: Jun 13, 2016
• ISBN: 9781310196942

Gary Russell

Dr. Gary Russell has spent many years teaching Economics in Canada and in China. But he has always had an uneasy relationship with his discipline, unable to reconcile its materialist utilitarian base and it's hard-core individualism with his Christian beliefs. Now in his semi-retirement years -- "the third stage of my career" -- he has turned his attention to debunking Economics and looking at economic issue through a spiritual lens. Some of that work can be found in his blog, TheProfaneEconomy.com. His ebook, "Searching for the Soul of Economics" is slated to be expanded into a Study Guide for college and university use.

Book preview

A Little Economic Context

This approach harkens back to the 18​th Century and a Scottish Presbyterian preacher and professor named Adam Smith, a well known name even in the 21st Century. But if you look him up in an encyclopedia, he's as likely to be called a moral philosopher as called an economist. Though he's best known for his path­breaking book called The Wealth of Nations, that was actually his second book. His first was called The Theory of Moral Sentiments. So Prof. Smith a good place to begin looking for the soul of economics.

Smith's concern in his first book was the widespread incidence of bad behaviour — selfish, dishonest, exploitative and abusive behaviour — throughout society. It was of course the responsibility of the church to modify such behaviour and bring society around to Christian values of compassion and justice. But that was a long­term project indeed and — in the meantime — something had to be done to bring under control those perverse individuals who were turning economic life into the law of the jungle. From that sentiment was born his more famous work, The Wealth of Nations, in which he asserted that it was possible to put in place a set of checks and balances that would keep individuals in line despite their selfish tendencies. Indeed, that system of checks and balances was already in place — it’s called the market.

One of Smith's most famous quotes runs as follows: It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity but to their self-­love, and never talk to them of our own necessities but of their advantages. In that manner, the competitive market keeps humanity's selfish nature in check and ensures that their selfish behaviour is turned to the public good — as if by an invisible hand which will keep goods flowing freely at the lowest possible prices.

Of course, Smith was referring to the ideal competitive market, an abstract theoretical model which did not represent the real world very closely — a point which he frequently stressed. But nonetheless an ideal model can be useful as a goal towards which we may strive. So Smith described in exquisite detail the properly ­functioning competitive market, noting that its ideal characteristics can actually be found in some real­-life markets, even though the typical market is just as likely to be dysfunctional. That caveat given, he put forth the model of free competition that became the rallying cry for free market ideology for centuries to follow.

Now, enter William Cavanaugh. In Being Consumed, he draws our attention to one of the chief disciples of Adam Smith in the latter 20​th Century, Milton Friedman. In the preceding two centuries, neoclassical economists had refined Smith's perfect competition model into an exquisite mathematical world of wonder, where the desires of all individuals are perfectly satisfied in the most efficient possible manner. They even achieved closure — meaning, in their mathematical scale model of the world economy, that every decision of every individual actor is mathematically resolved to the full satisfaction of everyone without exception. Never underestimate the power of a fully deterministic model in the ideological battleground.

Milton Friedman arose as not only one of the most clear­-eyed proponents of neoclassical ideology, but the one who attached it most firmly to the great western god of freedom. He defined the free market in terms of voluntary exchange for mutual benefit with no external coercion or deceit, where all parties know exactly what they're doing. They only information they