Two Invisible Hands of Adam Smith

Discussion

O.G. Rose:

"In Smith’s Theory of Moral Sentiments, the emphasis is on a “high order” coordination that spreads ethics and empathy, whereas in The Wealth of Nations, Smith is using the same metaphor to describe what we more commonly today understand “the invisible hand” to be describing:

‘As every individual, therefore, endeavors as much as he can both to employ his capital in the support of domestic industry, and so to direct that industry that its produce may be of the greatest value; every individual necessarily labors to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was not part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it.’⁹

This “invisible hand” arises in local environments while emergently helping with the whole that the locality might be oblivious of and even disregard (interestingly, Smith also justifies Capitalism as “beautiful,” writing that ‘[w]e take pleasure in beholding the perfection of so beautiful and grand a [self-organzing] system’).¹⁰ For McCloskey, from A Theory of Moral Sentiments, we see an “invisible hand” that is more ethical and even theological, while in The Wealth of Nations we see an “invisible hand” that more arises in local environments while emergently helping with the whole (which doesn’t even get into Smith’s essay on “The History of Astronomy,” which might provide a critical key for understanding “the invisible hand of the invisible hand” in Smith’s work).¹¹ In Capitalism, it is possible for these two “invisible hands” to be one and the same, but must they necessarily be unified? No, and the splitting of the one hand into two arises and increases as Capitalism increasingly ceases to force us to go, socially interact, and so develop empathy before “the face” of others (Levinas). On this point, we will make a “turn” in this paper to outline a critical problem: Smith’s (cybernetic) vision is best for managing and directing human motivation for social ends, but its effectiveness varies given the technological paradigm of which Capitalism helps bring about and/or change.

Adam Smith envisioned self-interest and communal-interest as two-sides of the same coin: we couldn’t participate in Capitalism without relating to others and, in the very act of encountering others, developing empathy and attachment that made it no longer in our self-interest to disregard others (Capitalism is in a way opposite of “religions of detachment”). Capitalism aimed to compel self-interest into attachment, at which point self-interest would entail other-interest. It’s a brilliant move, but here we can start to understand why Smith comes across as a tragic thinker: he supports Capitalism, but then sounds dismal when describing industry, assembly lines, and the like. Why? Perhaps because these were forms of Capitalism that didn’t necessary develop empathy and human attachment? And looking centuries ahead, perhaps Smith would have thought differently of Capitalism had he knew that this kind of work would become the rule instead of the exception (arguably the orientation from where Marx writes).

In Smith’s day, “the two invisible hands” described by McCloskey were “practically one” even if not “technically one,” and perhaps the effectiveness of these “hands” at the time was precisely because of their unity: one without the other leads to trouble. Today, thanks to Capitalism, we have developed technologies that allow us to shop, bank, buy groceries, watch movies, etc., without leaving our home. Remote work is possible. We basically never have to leave our home, and this is seen as a remarkable accomplishment of convenience and progress. Indeed, in a way it is, but in another way it is deeply problematic, for it means “the two invisible hands” can separate and no longer develop together (which was already a problem, considering the collapse of social and communal capital, as discussed in Belonging Again). It is now possible for “the invisible hand of the market” to strengthen the economy without at the same time developing social capital or training our capacities for socialization, empathy, and the like. In fact, what benefits the economy could train us out of these capacities, opposite of what Smith studied, with the Hikikomori in Japan as a strong case study of this problem and possibility.

For Smith, what we are “self-interested” in doing is trained by the people around us, so there is not a hard divide between “the social” and “the individual” regarding our motivation (hence why religions can focus on church over theology, even if both are needed: religions die by the congregation more than by the failed creed). This is our hope, but also our danger: if a social order with its social contract collapses, self-interest could atomize. This would be a separation of “the two invisible hands” in Smith, which in previous eras was unimaginable. Well, now, thanks to Capitalism and its technology, the impossible is possible: we can access the world without leaving our desk. In such a world, the hikikomori becomes possible and even rational (and perhaps it is rational of “the market’s invisible hand” to free itself from “the socializing invisible hand”?)."

(https://ogrose.substack.com/p/probable-cause)