Blogwatch: April 2023
Adam Smith anniversary, the New Deal, slavery, war & peace, and the Corn Laws
Klein on Coase on Smith
2023 is the 300th anniversary of the birth of Adam Smith. Smith was most likely born early in June 1723, but we do not know his exact date of birth. June 5, a date often given as his birthday, is his date of baptism.
On The Beacon blog, Daniel B. Klein writes on Ronald Coase’s Fitting Tribute to Adam Smith. Klein argues that Coase was right about Adam Smith’s beliefs: Human limitations bolster the case for limits on government.
In 1976, to commemorate the book’s [The Wealth of Nations] bicentennial, University of Chicago economist and Nobel Prize winner Ronald Coase wrote a pair of essays that discuss two of Smith’s great works—“The Theory of Moral Sentiments” and “The Wealth of Nations”—and their continued importance. This year marks the 300th anniversary of Adam Smith’s birth, and Coase’s essays once again make a fitting tribute. Here, I comment especially on Coase’s “Adam Smith’s View of Man,” which focuses on “The Theory of Moral Sentiments.”
Adam Smith 300-Year anniversary
And for those of you lucky enough to be in Scotland in early June, here is the webpage from the University of Glasgow for the Adam Smith 300 Year Anniversary, and for the Tercentenary Week (5-10 June).
The main lectures during the Tercentenary Week are by:
Gita Gopinath, who will touch on what Adam Smith would say about the state of globalisation (Monday 5 June).
Professor Dierdre McCloskey (Wednesday 7 June).
Professor Sir Angus Deaton (Thursday 8 June).
The Adam Smith 300 Symposium is on Saturday 10 June.
The New Deal is still recovering
Somehow George Selgin is still going strong. His series of posts on the Alt-M blog discussing The New Deal and Recovery has grown to 27 parts!
Part 23 covers The Great Rapprochement:
What finally brought the Great Depression to an end? We've seen that, whatever it was, it took place not during the 30s but sometime between then and the end of World War II, when a remarkable postwar revival occurred instead of the renewed depression many feared. We've also seen that, while postwar fiscal and monetary policies weren't austere to the point of preventing that revival, they alone can't explain it, because they can't explain the reawakening of private business investment from its decade-and-a-half-long slumber.
Part 24 looks at The Reconstruction Finance Corporation (RFC):
The centerpiece of the “Hoover New Deal”—the Reconstruction Finance Corporation (RFC)—went on to play an even more important role in the Roosevelt version. Under the leadership of Texas entrepreneur Jesse H. Jones, it became nothing less than “America's largest corporation and the world's biggest and most varied banking organization”. But did it help the U.S. economy recover from the Great Depression?
Part 25 is The RFC, Continued while Part 26 is The RFC, Conclusion.
Part 27 examines Deposit Insurance. Selgin writes that no step was more significant, and none has been more misunderstood than the passing of the 1933 Banking Act which provided for the establishment of the Federal Deposit Insurance Corporation (FDIC). He argues that to delve into the misunderstandings surrounding the Glass-Steagall Act (as the 1933 act is known) is to realise, among other things, just how hard it can be to answer the question: How much credit does the New Deal deserve for ending the Great Depression?
The length of the Selgin series becomes clear once you realise he is now turning these posts into a book, to be published by the University of Chicago Press. When writing the blog posts he skipped over some topics, but now they are to be a book these gaps must be filled. I’m looking forward to it!
Slavery and the American economy
On the AEA website, Gavin Wright looks at Slavery and the Rise of the Nineteenth-Century American Economy. Wright’s piece is in the Journal of Economic Perspectives, Vol. 36, No. 2, Spring 2022: 123-48. The abstract reads:
The essay considers the claim that slavery played a leading role in the acceleration of US economic growth in the nineteenth century. Although popular among pro-slavery apologists, the proposition fails under rigorous historical scrutiny. The slave South discouraged immigration, underinvested in transportation infrastructure, and failed to educate the majority of its population. It is not even clear that the region produced more cotton than it would have under a counterfactual alternative settlement by free family farmers, on the free-state pattern. The grain of truth in recently popular narratives is that many northerners and business interests were complicit in the crime of slavery: routinely engaging in transactions with slaveholders, even promoting activities that facilitated slavery and the domestic slave trade. Complicity complicates simple historical moralism, but it is quite different from the notion that the prosperity of the nation as a whole derived from slavery in any fundamental way.
Russia goes backward
Economic backwardness in Russia is the topic of a column at VoxEU.org. Simeon Djankov writes that:
Western sanctions after Russia’s invasion of Ukraine have markedly changed the constitution of President Putin’s inner circle. This column argues that the concentrated system of power created around the president is shedding the last vestiges of open market economy views. As the combined result of sanctions and closed-economy policies, the Russian economy looks inward, with imports down nearly 20% in 2022. Previous periods of autarkic policies in Russian and Soviet history have resulted in economic backwardness.
Russia, China and peace
In a related column at VoxEU.org, Gérard Roland argues that Helping Ukraine is not only crucial for peace in Europe but also for world peace. He argues that efforts at ending Russia’s expansionist goals in Ukraine would assist in limiting the hegemonic ambitions of China; and that given its economic weight as the largest economy in the world, China represents a bigger threat to world peace than does Russia.
Boudreaux and Irwin on the repeal of the Corn Laws
Don Boudreaux has shared the full text of a 2021 article he and Doug Irwin wrote to commemorate the 175th anniversary of the repeal of the Corn Laws in Great Britain (published in the Economist, June 25th, 2021). Self-recommending!
By Paul Walker
