Notes on Manent’s The City of Man, Chapter III, “The Economic System”
by David Alexander
Where Montesquieu cautiously established the English experience as a new authority, Adam Smith accepted it as an established authority. Smith explains economic growth in England and Scotland in his day as the result of “the desire to better one’s condition.” He universalizes this experience and says that it is human nature to always be striving for “progress,” and hence improvement is the general law of history. His faith in this principle permits him to forego his usual empirical rigor and assume its presence in opaque areas of history. He treats political institutions as only being able to place negative limits on improvement.
Thomas Hobbes posits mankind’s fundamental inclination as being a restless desire of power after power. Smith develops and simplifies Hobbes’s simplification, converting the desire for power into the desire for purchasing-power. Smith evinces a belief in the possibility of a dialectical linear deduction of “history” starting from “nature.” The fundamental human desire is reduced first to being the desire to better one’s condition, and then to the desire to increase one’s purchasing-power. Nature and history come together into what is called the “economy.”
The desire to better one’s condition is conceived as quite complex in the work of Smith. It changes significantly in his two great works from The Theory of Moral Sentiments of 1759 to An Inquiry into the Nature and Causes of the Wealth of Nations of 1776. In the first, the human desire for betterment is essentially vanity, which is defined in relation to others. In the later, the reference to the social bond is excised.
In the desire to better one’s condition is presupposed a certain image of the better conditions, a phantasm of the imagination. So the imagination is perforce given a central role. Smith indeed puts imagination at the heart of his first book. Smith holds that our interest in money and power, and the arts and sciences, is driven by attraction essentially to beauty. When we pursue utility, it is really vanity we seek, and when we give into vanity, we are attracted by beauty.
The concept of the “invisible hand” remains the same in its definition in the two aforementioned works but it differs greatly between them in content. In Theory, human beings are ruled by their imagination and vanity but in Wealth, the imagination and vanity disappear and human behavior is cast as being motivated only by gain and interest. Between the two is a chasm stretching between the prestige of the imagination in an society of unequal people and the prosaic and rational pursuit of gain in an egalitarian society.
Smith’s account of how inegalitarian, feudal society gave way to the egalitarian character of commercial society, for all the breadth and serenity of his masterpiece The Wealth of Nations, and for all its status as received wisdom in liberal societies, appears to rest on the slender, insufficient base of an epigram: The feudal lords bartered away all their power and authority for diamond belt buckles and such.
Manent criticizes Smith’s portrayal of the psychology of the feudal landlord as implausible and inconsistent. “When Smith yields to epithets of increasing indignation in characterizing it, he is only trying to mesmerize his own uncertainty and our vigilance.” Smith posited two different human concerns that led to the revolution, childish vanity in the great proprietor, represented in Theory, and interest and gain in the merchant and artisan, represented in Wealth. Smith’s explanation of the childish vanity of the feudal landlords does not explain why they would choose to give up the prestige of their position. Smith so greatly desires to deduce the institution from the economic conditions that he asserts that the proprietor rules over his clients because he feeds him. But this reasoning may be flipped to the conclusion that the proprietor obeys his clients because he feeds them. While some might respond that the two need not be exclusive, Manent drives home his point that, as with the sociological point of view, the language is “shallow and vain!” He rejects Smith’s idea of a feudal lord as preposterous, as a strange phantasm of the mind in which a person inexplicably saddles himself with hundreds of dependents. A tenable explanation must render the appropriation of surplus and the support of dependents intelligible.
Smith tells the story of the advance of commercial society without telling a truly human story. Smith, unlike Montesquieu, does not refrain from identifying a fundamental passion in human nature behind progress but presupposes the irresistible desire to better their condition.. But if they know what they want and attain it, why speak of an “invisible hand”? Manent holds that the spirit of commerce so ruled Smith that he equated it with human nature.
Manent returns to his criticism of Smith’s psychology of the feudal landlord as inadequate, something that blinks on just at the point of its dissolution, and then blinks off. He says a more serious look at the landlord’s soul shows that he does not barter away his power and prestige for trinkets, which Smith holds he does, reviling him for it. Rather, it is because he is powerless before the centralized royal power of the sovereign already that his childish “vanity” increases. Because Smith does not look at the landlord from the political angle, the landlord’s action becomes preposterous to him, when really it is Smith’s imputed psychology which is preposterous.
Smith’s conception of the imagination is one in which the desire for power, wealth, and the products of technical ingenuity are all rooted in the same aesthetic idea. It is the imagination, not utility, which gives things their value, makes them desirable, and associates them with human nature. But the imagination liberates man from the constraints of his nature in order to subject him to its own nature. The imagination is unaware of its own value as the value giver and, so, unaware of qualitative differences from one regime to another and one epoch to another.
To the extent that the idea of utility exercises and satisfies the imagination, it rules over economic man. For the participants in the market, the role of the imagination tends to disappear into the artifacts, but from the spectator’s point of view, the imagination’s role becomes very prominent. There is the perspective of the citizen acquiring the new watch and there is the perspective of Smith, admiring and seeking to make perfect the economic system so that it runs undisturbed, with regularity of motion.
In the new society, the imagination becomes formalized and individualized. The observer sees in it, not individuals acting in ways liable to moral judgment, but rather a harmonious system where the natural motives of individuals are as obscured as the inner workings of a watch. The system produces effects corresponding to the idea of utility.
The commercial imagination reduces all things to useful things as far as they embody the idea of fitness, but it seems clueless when it comes to establishing their relative value. The imagination cannot appear as a measure of value in the commercial society except as labor, which hence becomes the sole locus of value. (It has left no leisure for contemplation). All value resting on labor, labor becomes of ever greater value.
Once labor is exalted in this way, the imagination, as a universal human faculty capable of embracing the Whole of the cosmos, shrivels into inconsequence. The economic viewpoint, which is in no way a “conception of the world,” then settles in and in effect, the Creation is renounced. All that is left is the vital principle and untiring motor of commercial society. The one great object retained by the imagination is the harmonious system of production and consumption. The splendor of God’s glory bright, in the radiance of the Son, and in the Creation created through the Son, is effectively occluded. “Man as economist is the pure spectator of man become homo oeconomicus.”
The Economy writ large is motivated toward homogeneity since only equal values can be exchanged. “Commercial society nurtures and contains the immanent utopia of a powerless society, a depoliticized society.” However, the power of purchasing labor subsists. The economic process, in which labor is embodied in objects and services, is driven by a profit motive. Economic man works to make capital bear fruit. Without profit, the Economy quickly becomes a “valley of industrial dry bones.” Only profits proportionate to capital give life to the Economy. “Profit, not religion, is the spirit of this spiritless world where one must overwork in order to live: the commercial society.”
Some object to the notion that surplus is not institutionalized in a capitalist society like it is in earlier societies. Surplus, like profit, is appropriated in private property, the institution par excellence. Yet Manent replies, “The noninstitutionalized, underdetermined, floating character of surplus is most clearly revealed in the choice left to the capitalist to use it for his own consumption or for investment.” The nature of profit revealed itself in the discretionary choice it offered between consumption and investment. The imagination and capital make things felt worldwide. Only the owner of capital can conceive endlessly the new correspondences which constitute the life of the Economy. Authoritarian or planned investment petrify the network of social valences and the movement of the imagination.
The freeing and the founding of the economy took place at the same time and, from that time forward, it cannot be properly said that the economy is distinct from society. The body politic itself becomes merged with and indistinguishable from the economic system. Imagination rules over labor, yet labor constrains the imagination to produce only ideas which display the idea of usefulness and that are liable to encourage labor. One now works only to work, to carry out the useful ideas the imagination endlessly conceives. Labor never rests. But there has been a dastardly trade-off: The imagination has lost all sense of glory.