"Charity is the great channel," it has been well said, "through which God passes all His mercy upon mankind. For we receive absolution of our sins in proportion to our forgiving our brother. This is the rule of our hopes and the measure of our desire in this world; and on the day of death and judgment, the great sentence upon mankind shall be transacted according to our alms, which is the other part of charity. God himself is love; and very degree of charity that dwells in us is the participation of the divine nature." Morals and Dogma
Morals and Dogma VIII Intendant of the Building
Adam Smith failed to notice that self interest is not the only possible motivator of economic systems.
The first studies of economics must have been much earlier than our history tells us. The obvious importance of the subject should have caused thinkers of the ages to explain this topic in more detail than what we can see today. We find some banking laws in Deuteronomy but there is little more said on the subject over these many years.
Our modern understanding of Economics came out of the 18th century, a period of history of new political realities, of democracy, and individul freedoms.
During this period science has defied the Church, free thinkers are governing themselves. For the first time, it is discovered that we are governed by our brain. Prior to this discovery we generally believed that God and the Devil were responsible for our actions. We were motivated by spirits. That we were somehow connected to God. Madness was explained as demonic possession. For philosophy, it was the age of reason where questioning everything was in fashion. Capital replaced a dogma of the Church that had previously enforced ignorance.
These are the times that gave us Adam Smith and the advent of capitalism.
"Political economy, considered as a branch of the science of a statesman or legislator, proposes two distinct objects: first, to supply a plentiful revenue or product for the people, or, more properly, to enable them to provide such a revenue or subsistence for themselves; and secondly, to supply the state or commonwealth with a revenue sufficient for the public services. It proposes to enrich both the people and the sovereign."
Adam Smith 1723-1790
The most basic concept of capitalism is that greed is the "invisible hand" that moderates free markets.
"It is not from the benevolence of the butcher, the brewer, or the baker, that we can expect our dinner, but from their regard to their own interest."
Adam Smith 1776
It is believed that the intent of Adam Smith was not to create mathematical model of supply and demand, nor to create tools to make personal wealth. His goal was to improve moral and ethical structure through wealth and good statesmanship.
Sometimes over looked is that Smith had written prior to "The Wealth of Nations" (modern translation) a thesis on morality, "The Theory of Moral Sentiments". It is from this line of thought that we have these first ideas of capitalism, and free markets.
If Adam Smith were able to know what we know now, he would have seen that a society can be smothered by its wealth. That self interest is not the only invisible hand or the only motivation we possess.
Replace greed with charity
Times have changed, Adam Smith was living in times of economic scarcity, today we live in times of over supply, the future will be times of population shrinkage along with over production. In a free state, self interest is not the only possible motivator to economic systems.
I think that micro socio/economic units that operate within free economies could be operated from a basis of charity rather than greed. Organizations would focus the economic power of a community to reach specific social ends.
A "competitive socialism", business specifically designed to enhance the quality of life. Designer villages that operate on altruism rather than self interest or greed. Small communities that provide economic and social protections from the larger forces of a capitalistic environment.
Large economic systems tend to maximize profit at the expense of the individual.
The study of macro economics functions shows a similarity to the laws of thermodynamics. After all, energy runs society, we burn everything from oil to steaks to make our social-economic system function.
Chaos theory can be used to predict large variable activity like the weather and can also be used to predict economic activity. We know that there is uncertainty in it's predictions. The world economy is so large that it has become like the weather. A small change across the world can have unpredicted effects in sectors that appear unrelated. Our world economic system based on greed and consuption will form regular storms and disasters. What amazes me is that certainly economists know these relationships, yet tell us that the regular storms of economics are not predictable. Unlike the weather we create our economics, and have several powerful tools to avert, or create storms. Yet, economist will stand before congress and claim they did not know the crisis was coming, or had the ability to manipulate it.
Production and supply will no longer be the problems of the future. Our choice for quality will hopefully supersede quantity. The disorganized system of free markets works well in macro scales, as well as in micro scales when there are shortages. It does not work well when there are surpluses, particularly for the individual.
The effect of a surplus on an individual is that it replaces our economic motivation for real and basic human needs with a glut of useless material objects.
The individual gets lost in large scale free market economies. Competition forces the entire family to go to work, isolating people, eliminating the family unit. This works very well for the income tax system, for this generates more consumption, and with more individuals working there is a larger pool to tax. To compensate, gangs and cults develop, and individuals find themselves quickly marginalized and without community.
The only safeguard are smart communities. Communities that use the best and most reasonable options to innovate, and create well being. The application of a cohesive ideology and moral structure within a tight and small community. Small sized independent economic communities within a free market system.
An economy dedicated to charity instead of greed.
Books.....