Speaker
Description
Adam Smith has often been hailed as the patron saint of capitalism, while Karl Marx universally acknowledged as its sharpest critics. Much of the ideological battle has been fought around the issue of social justice. The distribution of wealth, however, is heavily influenced by the contours of the monetary regime. How Smith and Marx understood money, and its relationship to capital, production, and justice, however, has rarely been examined.
For Smith, capital includes both the productive resources employed in the real economy, as well as the circulating money that represents them. This duality of capital enables Smith to downplay the importance of money and credit, as he confidently believed that the monetary representation of capital is a passive signifier that invariably follows the productive resource. The market, therefore, was perceived to be a natural hedge against the potential dangers of finance. In Smith’s analytical framework, how capital is managed and employed in the real economy is the central concern of political economy, while the monetary ownership of capital becomes a conceptually separate and ultimately inconsequential issue.
This opens the door for a scenario where a huge concentration of wealth in the hands of the few does not alter how capitals are actually employed, hence does not appear problematic to Smith. Smith’s theory of money and capital allows him to completely bypass the revolutionary message of Marx. On the other hand, Marx was equally dismissive of money, which he saw as a capitalistic commodity that cannot be wilfully manipulated. Achieving social justice required the abolition of money as an institution altogether. Tracing the intellectual genealogy of money and capital from Smith to Marx can provide timely and invaluable resources for reflections on distributive justice in modern finance capitalism.
| Organization | University of Cambridge |
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