Adam Smith in love

Pity the economist. His science is not only dismal but also inaccessible. To far too many observers and students, economics -- particularly classical economics -- come off as unsavoury, selfish and inhumane. And when the lowly fellow tries to prove otherwise, he finds that he is often spurned, rarely embraced.

All the bolder then is 'The Invisible Heart', a book by Russell Roberts of Washington University in St Louis.* Author Roberts doesn't stop at forcing on the general reader 200-odd pages of economic fare. He also insists on conveying that material through the improbable device of a fictional love story.

The setting is Washington's toney Sidwell Friends, or some other private high school like it. Sam, the uncultured high school economics teacher, bids for the affection of Laura, the auburn-haired Yale humanist. Alas, their backgrounds differ. Sam subsists on his mini teacher's salary. Laura by contrast lives the familiar 'parents in the wings' scenario. Her school pay is the same as Sam's, but her attorney parents sweeten her life with high-end gifts (we hear about a La Pavoni espresso machine). The family home lies on a Georgetown street where 'the red brick of the buildings seem to sing of money and power'. To compound the mismatch, our suitor reckons he can woo his girl with bon mots on school vouchers and diminishing marginal utility.

That this recipe for disaster somehow proves a triumph is a credit to Mr Roberts's abilities as teacher-convincer. Through Sam, he proves that free market thought can be elegant, efficient, and even as aesthetically pleasing as a La Pavoni.

Sam's case for charity is a good example. First he lays out the classic arguments for private sector giving over government-subsidised welfare -- if government subsidy were abolished, citizens would step in, as they did (he reminds us) in periods like the early years of the Great Depression, when there were no big programmes from Washington.

Next Sam makes the case that private charity itself is underappreciated, its subtle beauty obscured by the modern and blinkered commitment to a visible public sector. In place of the flabby LBJ and his Great Society, Sam offers Laura the medieval Jewish philosopher Maimonides, who believed there were eight levels of charity, the lowest being when 'the giver gives grudgingly', the highest, 'to give a gift that makes the needy person independent'. Other levels of the hierarchy reveal other nuances -- it is better, for example, to give anonymously than not. The whole construct is so enticing that even the doctrinaire Laura begins to relent.

Still, the greater charm of 'The Invisible Heart' lies not in its argumentation but in its insights into the challenges of conveying free market ideals. Sam, like most free marketeers, rarely encounters a like spirit in the upper-middle-class salon. That salon habitually mocks him, and quite often, actually ejects him. Alas, this part of the story is not fictional. For whatever reason, our society often derides free market ideas as hackneyed or primitive and ostracises their advocates. Years of hostility eventually wear these independent souls down; they develop various neuralgias and retreat to the intellectual bunker.

Rather than go this route, Sam tries to outclass his opponents. When Laura's brother, a Consumer Product Safety Advocate, declares him a 'snake' and throws him out of a Georgetown soirÈe, he wisely waits things out, rather than strike angrily back. As a sympathetic party, his sister the engineer, explains, 'in the business world passion is valued, anger or agitation is not....So the next time you feel your thermostat rising, think of the impact on your listeners. They're not going to be impressed with how worked up you are.'

This is wonderful advice for today's sarcastic conservatives. Corporate life instructs not only about the profit motive but also about the importance of demeanor and equanimity. If free marketeers recall this point when they encounter resistance, they will find that Mr Roberts is right. Love and social acceptance on the one hand and free market thought on the other may make an awkward pair. But they are not entirely irreconcilable.

*The Invisible Heart: An Economic Romance', MIT Press.

© Copyright 2001 Financial Times

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