Sunday, May 5, 2013

Invisible hands

I'd like some free marketeer to explain to me why the following statement could be made:

Any continued improvement in working conditions will depend on companies working with the Bangladeshi government, said Ferdows, the Georgetown professor. A March decision by Walt Disney Co. (DIS) to stop production in Bangladesh was “wrong- headed,” he said.
It's from one of Bloomberg News' excellent explanatory reports, this one on factory conditions in Bangladesh.

It was inspired, of course, by the collapse of Rana Plaza and the 600-plus dead workers, mostly poor women.

Also from the story, there is this:

 “If you look at industrial history across the world, for better or worse, this is what early industrial revolution looks like,” said Pietra Rivoli, a professor at Georgetown University in Washington and author of “The Travels of a T-Shirt in The Global Economy.” Bangladesh is “still a desperately poor country, and we shouldn’t minimize what a steady job with a steady paycheck means to a poor woman.”

No, we shouldn't. We should emphasize the workings of the untamed market and how it -- according to Professor Rivoli, and anyone who knows economic history will agree with her -- always yields this result.

Why is that?

If you read the rightwingers, you will often find references to an "invisible hand." Never, or very seldom, to the invisible hands who are immolated in the name of efficiency.

Why cannot the invisible hand take care of the invisible hands?


  1. As I've noted before before, the invisible hand has done a wonderful job of taking care of most hands, invisible or otherwise.

    It's often been said that the winners write history and I suppose that would include economic history. What our discussions have taught me Harry, is that each person creates their own economic history. The history that you've created for yourself has very limited overlap with the history of the world that I inhabit.

  2. Well, hardly. The invisible hand must work all the time, if the theory has any validity at all, unless restrained in some fashion.

    So, it was working during the slave trade. The slave owners were doing their best to maximize personal assets, and the slaves were trying to escape.

    It seems the invisible hand did not lay about with equal effect for all. Some few tens of thousands of slaveowners benefited and some tens of millions of slaves suffered, not to mention the millions who were killed.

    Technology rules. It operates whether the invisible hand is permitted to or not.

  3. As elsewhere, you ignore what a functioning market requires: an effective central government enforcing property rights.

    So you assertion that the invisible hand must work all the time if it is to work at all is nonsense. I have been places where the invisible hand was crushed.

    They were hellholes.