Complete Whimsy, Dubiously Free Trade, Hayek, Live and Learn

How Economics Became the “Dismal Science”

If you’re an economics geek like myself (or even if just interests you a bit) you’ve probably heard it referred to as the ‘dismal science.’ I always figured it had something to do with the fact that economics lies in the gray area between the social and natural sciences. As F.A. Hayek put it:

It seems to me that this failure of the economists to guide policy more successfully is closely connected with their propensity to imitate as closely as possible the procedures of the brilliantly successful physical sciences – an attempt which in our field may lead to outright error. It is an approach which has come to be described as the “scientistic” attitude – an attitude which, as I defined it some thirty years ago, “is decidedly unscientific in the true sense of the word, since it involves a mechanical and uncritical application of habits of thought to fields different from those in which they have been formed.”

However, the saying is really more negative in connotation toward the entire profession than noting a flawed approach to it. To me, it’s sort of reminiscent to the “bourgeois economists” Marx denounced.

Well, it turns out the first use of the term was by Thomas Carlyle in 1849, which is as follows:

Truly, my philanthropic friends, Exeter Hall Philanthropy is wonderful; and the Social Science—not a “gay science,” but a rueful [one]—which finds the secret of this universe in “supply-and-demand,” and reduces the duty of human governors to that of letting men alone, is also wonderful. Not a “gay science,” I should say, like some we have heard of; no, a dreary, desolate, and indeed quite abject and distressing one; what we might call, by way of eminence, the dismal science. These two, Exeter Hall Philanthropy and the Dismal Science, led by any sacred cause of Black Emancipation, or the like, to fall in love and make a wedding of it,—will give birth to progenies and prodigies; dark extensive moon-calves, unnameable abortions, wide-coiled monstrosities, such as the world has not seen hitherto!

Yes, Thomas Carlyle was decrying the fact that classically liberal economists opposed slavery! The quote comes from Occasional Discourse on the Negro Question which Carlyle wrote arguing for the reintroduction of slavery in the West Indies to better ‘regulate society.’ How wonderful.

This helps elucidate the great myth that the supporters of capitalism, so called, during the 17th, 18th and 19th centuries were reactionaries who, well they obviously supported slavery and other such oppression. What’s left out is that there was no word ‘capitalism’ back then. Capitalism is a term coined by Marxists. What a supporter of limited, decentralized government, free markets and personal liberty was called back then were a liberal (it’s now called classical liberalism). And they were quite radical reformers of their time.

The great classical liberals; Locke, Smith, Jefferson, Paine, Ricardo, Wilberforce, Hume, etc. may have been hypocritical at times, but philosophically they all opposed slavery and supported limited government and free markets (although not necessarily corporations).

What they opposed was mercantilism and monarchy; basically government/corporate collusion and aristocratic privilege. They supported freedom and liberty. And they were opposed for this radical idea by the defenders of the divine right of the Kings and Great Man Theories of history acolytes such as Thomas Carlyle.

Photo Credit: The Economist

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