Of course, before the dawn of capitalism, the pursuit of economic interests was considered one of the worst passions; avarice was always a foe of the Platonic conception of Reason and the Christian view of the Truth. Nevertheless, with the decline of feudalism and the rise of absolutist monarchies, the great concern of thinkers like Hobbes was the rising power of the state and the passions that led monarchs into ruinous external and civil wars. In this context, the pursuit of wealth was transformed in the seventeenth and eighteenth centuries into the pursuit of material interest. Two eighteen century thinkers at the center of this argument were Montesquieu and Sir James Steuart.
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It is also a story of the euphemization of a rising economic system which sought to hide its worst aspects. This idea is omnipresent now, and widely accepted. If the aim is to serve the common good this system of personal enterprise motorised by greed would seem to be a poor one for bringing about that good.
But through that strange alchemy that Adam Smith would eventually call the invisible hand of the market, these forces actually could serve the common good. How did these vices become accepted then? Thinkers like Montesquieu and Steuart became convinced of the moderating effects of trade on the despotic urges of the absolute rulers of their time. The focus here then, was not on the material impacts of commerce, but the changes it would effect in the behavior of rulers.
The exploration of the concept outside of politics was also exceedingly common. It holds an interesting parallel to the changing nature of the direction of acquisitive desires, from land and luxury goods to that of money, and how the transition motivated ever greater desires for money.
Hirschman frames it through the concept of the law of decreasing marginal utility formulated by the German sociologist Georg Simmel. Part of this process intersects with the broader development of commerce, spurred onwards and made necessary by the conquest of the New World and other colonizations alongside it, with the faraway markets these adventures opened up. These long journeys over great distances needed legal instruments for their facilitation, and thus the bill of exchange was created.
A bill of exchange was an instrument of credit, and represented what Montesquieu called effets mobiliers, or movable property. So, with the intellectual underpinnings of a movement that sought to bridle the excesses of despotism flourishing, and the legal framework of the thought coming into formation, this new politico-economic thought was coming into its fore.
It was ultimately experience that shattered the nostrums of this high-minded thought that sought to justify the rapacious and expansionary instincts of the ascendant capital class. Alexander de Tocqueville identified some of these flaws as early as , in his Democracy in America, which are acutely relevant today. As Hirschman illustrates, it has been done before. And it will it be done again. Share this:.
The Passions and the Interests: Political Arguments for Capitalism Before Its Triumph
Shelves: ethics-christian , history-economic , capitalism Very good summary of the intellectual currents that lead from the early Christian view that the pursuit of money is less than virtuous, to the view that pursuit of self-interest in the form of commerce is beneficial to human freedom by its necessary restraint on the power of the state. Of course, this idealistic view has since proven flawed. However, it remains helpful in understanding the context in which Adam Smith and others wrote in favor of what would become capitalism, and for today of Very good summary of the intellectual currents that lead from the early Christian view that the pursuit of money is less than virtuous, to the view that pursuit of self-interest in the form of commerce is beneficial to human freedom by its necessary restraint on the power of the state. It also raises the issue that as capital is threaten, so too may be liberty, as those with capital prefer law and order over freedom. Written in , in my mind it raises interesting questions about the future of the developing world, especially China, and for America as the economic future of the Middle Class continues to be threatened. Hirschman argues that capitalism developed as a means by the rising merchant class of the late middle ages to check the nearly tyrannical powers of the local aristocracy. Money making was a frowned upon activity, with avarice being sinful.
The Passions and the Interests : Political Arguments for Capitalism before Its Triumph
He had a sister, Ursula Hirschmann. He worked for the Institute for Advanced Study from — until his death. Here he emphasized the need for unbalanced growth. He argued that disequilibria should be encouraged to stimulate growth and help mobilize resources, because developing countries are short of decision making skills. Key to this was encouraging industries with many linkages to other firms.