Worldly Philosopher: The Odyssey of Albert O. Hirschman

by Jeremy Adelman

  This meant reckoning with the ancients.

  The ancients, like Machiavelli, with whom Hirschman dined and conversed in his head were shrewd observers of what went on around them and detected new meanings in the unheroic activities of Men. Maybe he was “doing an injustice to these thinkers by comparing their fond predictions to the dismal outcomes”? It is often true that realities fall short of tall orders; Hirschman, of all people, could be accused—and many did—of overselling Hope. “But so it is with any perception of the possibility of change!” he exclaimed. “And they at least dared to speculate,” he went on. “Nevertheless—what vision!” he exclaimed again to himself. And, winding himself up a bit more, he could not resist a speculation of his own: “perhaps they increased, by their speculations, the chances of sometimes achieving the goal of a more humane polity.”37

  This was a virtuous formulation, a lighthouse for the darkness of the 1970s, a key to Montesquieu’s puzzle. It was not original, but rather a recovered tradition into which Hirschman was placing himself in order to declare it still alive. He aimed to recover the idea that “the expansion of commerce and industry is useful because it will deflect men from seeking power and glory, [and] will keep them busily occupied making money which is harmless and perhaps even socially useful.” Citing Hegel, he concluded that “the heroic ideal” was now “demolished” and had given way to “change by praxis.” “Man can be changed by what he is doing,” he scribbled.38

  The problem became consuming and helps account for why Hirschman was pulling away from his fieldwork in Latin America and his engagement with development economics. There was more. The search for the right mixture of pursuits and constraints, economics and politics, interests and institutions might even provide some clues to help pull development thinking out of the somber impasse into which it had run. The result left him feeling all the more muddled about his own field, and more specifically—and rather melodramatically—torn about the unforeseeable consequences of some of the doctrines he himself had espoused. “I feel incapable of further devoting thought to development until I begin to see a few paths in this foggy landscape for fear that by successful development or even by improving income distribution I contribute to the destruction of the human spirit.”39 For now, the pathway to recasting self-interest in a way that did not make it incompatible with the public good required going back centuries to the founding of its modern meaning.

  These visions were the ones that Hirschman set about to recover in The Passions and the Interests: Political Arguments for Capitalism before Its Triumph, published by Princeton University Press in 1977.40 In the examination of discourses, literally arguments, about market life and behavior through the visions of seventeenth- and eighteenth-century political economists, what he revealed was equal parts anxiety about human motives, passions as well as interests, and equal parts homage to the creativity of a language with which to control and channel them into socially useful pursuits. In a sense, Hirschman read Montesquieu and others just as he had “read” the policy makers of Journeys toward Progress, examining how they understood the world around them through their vocabulary and word games. At the core of The Passions and the Interests was a dynamic of words and arguments getting absorbed or “imposing themselves” to assuage, assimilate, or even anesthetize what was once so shocking about Machiavelli as the first big unmasker of the Modern Age. In his telling, arguments propelled arguments along—constituting an “endogenous process.” The sum was intended “to renew the sense of wonder about the genesis of ‘the spirit of capitalism.’ ” For two hundred years after Machiavelli sought to account for “man as he really is,” writers grappled with how to think about moneymaking, considering the ways in which selfish wickedness might be thought anew. Mandeville and others argued that the luxury trades and pursuit of “private vices” could be good for “publick benefits” through “dexterous management.” In this fashion, personal drives could appear less shocking, and the message about them could be absorbed into “the general stock of accepted practice” by changing the language and rebranding personal passions into interests, first as a substitute coinage, and eventually, as Hirschman told an audience at the Collège de France, into a useful euphemism for self-satisfying activity.41

  This set the stage for Adam Smith, who took self-interest one step further with the doctrine of the Invisible Hand. The shift was inscribed in the famous line, whose vocabulary laid the tracks for a triumphal formulation: “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner,” with Hirschman underscoring Smith’s choice of words, “but from their regard to their own interest.” It was not to their “humanity” that society appeals, but to their “self-love,” not to “our necessities” but “their advantages.” Hirschman underlined the keywords in his copy of The Wealth of Nations. Here, Smith famously stripped interests of their “unsavory synonyms” (these now being Hirschman’s choice of words) and elevated them to undeniable good thanks to men’s “trucking disposition” (back to Smith’s words) without a concession to private, hidden vices.

  As it happens, there was no historic figure whose legacy would be more contested than Adam Smith as his rivals fought to claim him as their forebearer. If there was one man who would set the stage for a great ideological struggle over how to think about markets and politics, private pursuits and public wellbeing, it was Adam Smith. And Hirschman, anticipating the fight, struggled to create a bridge between the sides by positioning Smith as a man who championed private self-interest but never lost his public moral bearings. Not unlike Hirschman himself.

  Now, when Hirschman settled into Smith’s writings in the spring of 1973, his first impressions were of an author “contradicting himself in the most effronté manner” which “spoilt a neat ideological classification with which I had set out on this whole thing.” But in the end, “it makes it of course more interesting.” He found, upon reading and reflection that perhaps Smith was not such a jumble; perhaps he was using words differently—and in new combinations—which was one of the reasons why Hirschman came to recognize the power of Smith’s rhetoric, leaving him “fairly bubbling over with excitement” at his verbal discoveries.42 Words like passion and vice gave way, according to Hirschman, to “such bland terms” as “advantage” or “interest.” This was on purpose; by mutating motivations in this way, they could be made more calculable, more predictable, more reliable—a far cry from the bygone rhetoric of unruly aristocratic pursuits. The language of “value” and “production,” “waste” and “idleness” had inverted the scourge, culminating in Smith’s famous passage on how Towns Improved the Country in book 3, chapter 4, which accented the unintended effects of personal pursuits on “public happiness,” for neither “great proprietors” nor merchants (“in pursuit of their pedlar principle of turning a penny wherever a penny was to be got”) had public service in mind. “Neither of them,” Smith wrote, “had either the knowledge or foresight of that great revolution which the folly of the one, and the industry of the other, was gradually bringing about.” One of Hirschman’s marked passages, it illustrated the workings of language behind the alchemy of the marketplace. It also carried with it political implications. Smith had no love of merchants, as both Skinner and Winch had pointed out, and the caustic vocabulary about “the pedlar principle” suggests that. “How many people,” Smith asked in a passage that Hirschman underlined in his copy of The Theory of Moral Sentiments:

  ruin themselves by laying out money on trinkets of frivolous utility? What pleases these lovers of toys, is not so much the utility as the aptness of the machines which are fitted to promote it. All their pockets are stuffed with little conveniences. They contrive new pockets, unknown in the clothes of other people, in order to carry a greater number. (p. 299)

  Left to their own devices, interests, not unlike the passions before them, lent themselves to withering depictions and unsentimental views. But from their banality came unintended general goods.

>   The same kind of force-counterforce portrait that Hirschman drew out of Smith’s portrayal of interests extended to his reading of Smith’s thinking about states, with Smith bowing to a broadly republican spirit that saw government at the service of the people and its prosperity through self-restraining rules. For while Montesquieu could invoke the bill of exchange as a modest engine of change because he could see no end in sight to arbitrary rule in France, Smith’s position was quite different: he could see examples at home of better government. But he was no less concerned about arbitrariness. Now, fear of the personal passions shifted, in a passage that Hirschman marked in his copy of The Wealth of Nations, to the menace of “public prodigality and misconduct.” The people who compose “the court, the ecclesiastical establishment, such people, as they themselves produce nothing, are all maintained by the produce of other men’s labour” (book 2, chap. 3, p. 325). These selections reveal the readings behind Hirschman’s writing. The passages of choice, a few of which filtered into the final, spare narrative of The Passions and the Interests, point to a Hirschman looking for Smith’s key words, drawing out both the evolution of the arguments as well as Smith’s own ambivalences as he groped for a way to reconcile republican ideas of virtue with what would soon become liberal notions of rights, civic religion with limited government, the priority of collective life with heterogeneity of interests—the chasm that was beginning to open up between a traditional language of politics among eighteenth-century thinkers and a vocabulary of the later, liberal age. This struggle within Smith fascinated Hirschman, and he wanted to recover it from the sanitized interpretations of later self-interested readers who had lost sight of the Scottish moralist’s effort to reconcile civic humanism with capitalism in favor of a Smith as an apostle of self-interest. This version of Smith had, in turn, political implications. The juggling act between virtue and self-interest, power and public good, was elegantly captured by David Hume in one of Hirschman’s favorite passages from the 1742 essay “Of the Independency of Parliament.”

  Political writers have established it as a maxim, that in contriving any system of government and fixing the several checks and balances of the constitution, every man ought to be supposed a knave, and to have no other end, in all his actions, than private interest. By this interest we must govern him, and, by means of it, make him, notwithstanding his insatiable avarice and ambition, cooperate to the public good. (p. 117)

  Whereas the original civic humanist code required of citizens that they serve the public interest directly—as active citizens—Englishmen could now be seen, thanks to commerce and industry, to be promoting the public interest indirectly by pursuing their personal gains directly. For all this to function, for the word games to be effective, interest-propelled activity by governments and people required measures of self-restraint. The Invisible Hand was not a heavy one. This is one of the reasons why, as Skinner pointed out to Hirschman, the verb to meddle acquired its derogatory currency over the course of the eighteenth century.43

  Like Pocock, for whom classical republicanism was fundamentally a debate about the fears and perils of self-rule, so too were Hirschman’s political economists arguing about the instability and strife associated with market life—anxieties that necessitated a semantic shift: the transmutation of individual passions into interests. The difference was that Pocock’s famous study ended in a worrying register about the world to come and the end of a republican political ideal, whereas in Hirschman’s account, the semantic moves ended in the “triumph” of a capitalist economic ideal. This artful, unintended, slowly accreted, linguistic turn could then create possibilities for new “discoveries.” Interests—by being domesticated, tamed, and softened in the course of what Montesquieu called doux commerce—could create a historical consciousness that permitted their moneyed and propertied beneficiaries to enjoy the good regard of sovereigns. Sovereigns for their part could regard self-interested private men as potential stakeholders in a public system known as the modern state—but this presupposed that rulers also subjected themselves to the self-restraining habits and repressions to which the private passions were also submitted. People would become more governable and governments would become more respectful of the autonomy of interests delicately woven from the strands of thousands of transactions. This is why, as Hirschman noted, alienation and repression could yield some positive results, especially, with an unrestrained Pinochet in mind, an authority that refrains from trampling on the liberties of its subjects. The Chilean dictator exemplified what happens when the state does not restrain itself while, paradoxically, claiming to free people for private pursuits.

  If Hirschman had autocratic targets in mind, he was also jabbing at those who denounced capitalism as some scheme to oppress man’s “true” nature. The crusade of 1960s radicals in favor of the “inalienation” of man to free his inner, self-adoring soul to pursue his passions was no less troubling for Hirschman. There were few, if any, communitarian features of the “civic humanist” in Hirschman’s brand of republicanism—which was one that rested on the necessary, creative, and ultimately resolvable and reformable tensions between individualism and the common good. This was reformist ground, not grist for collective revolution. There is a reason why one of Hirschman’s own key words in The Passions and the Interests, which comports with his republican sense of checks and balances in all affairs, was countervail. He wanted disruption and repression, harmony and disorder—passions and interests. Each force contained within it its own tendency to resist it. This did not make them self-correcting, and Hirschman was not meaning to imply, like Hayek, that complex systems have an internal, Archimedean point to which they return unless “meddled with.” And from the “countervailing passions” one gets the “countervailing interests,” and from this “counterposing force” one derives a set of principles about restraints. This kind of vocabulary pointed not just to the roots of Hirschman’s optimism, but also to his sense that there was no need for a single insight, or fundamental Historical Law, to command behavior and policy; it was out of the complex mixing, tension, and dialectic that hope would emerge. Consider his exuberant ruminations on La Rochefoucauld’s dissolution of passions and almost all virtues into self-interest:

  A message of hope was therefore conveyed by the wedging [note the agency of words and the role of authorial choice] of interest in between the two traditional categories of human motivation. Interest was seen to partake in effect of the better nature of each, as the passion of self-love upgraded and contained by reason, and as reason given direction and force by that passion. The resulting hybrid form of human action was considered exempt from both the destructiveness of passion and the ineffectuality of reason. No wonder that the doctrine of interest was received at the time as a veritable message of salvation!44

  While the aphorists of the seventeenth-century human condition knew something of the life of the libertins, it fell to Smith to draw this realism to some powerful conclusions. And from his conclusions a new line would be drawn in the social sciences. What Smith accomplished in The Wealth of Nations that was so revolutionary was to establish an influential economic justification for the pursuit of self-interest; until then most thinkers tended to argue in political terms, that self-interest would curb the excesses of rulers. This crucial move, in Hirschman’s view, set the stage for a splitting of politics and economics and made personal pursuits the basis of a more calculable, predictable order. It was important to set the record straight. Smith’s view, according to Hirschman, was “very different from the laissez-faire or minimal state doctrine … still widespread today among economists.” Rather, Smith viewed politics as the realm of “the folly of men.” So Hirschman tried his hand at developing his own metaphor: Smith was not an advocate of a stripped-down state to let the Invisible Hand work its charm, but a state “whose capacity for folly would have some ceiling.” This metaphor was among those that never caught on. Hirschman’s own view, harkening back to the spirit of Montesquieu’s brand of re
publicanism, was that the same might be considered applicable to the market, which was not immune to follies—as Smith implied in his sneering words about pedlars. But it was only an implication. In the main, Hirschman argued, Adam Smith converted what were once antonyms, “interests” and “passions,” into synonyms—so that the whole of society is advanced when everyone is allowed to follow their own private interest.45

  The Passions and the Interests was an argument for a historic middle ground of a classical republican sort. His struggle was two-fronted. While he wanted to challenge those who saw the self as a utility-maximizing machine, he also rejected the communitarian nostalgia for a world that was lost to consumer avarice and a celebration of “the love of lucre.” His was a vision, projected through the prism of ancient discourses that aimed to make it normative, of polite, civic-minded people going about their “business” in ways that enabled self-interest and the common good to coexist in the same sentence, a Harmonielehre (study of harmony) that could be both realistic and hopeful. It was a delicate balancing act of restraint and freedom in the service of “a more humane polity.” It was also a way of deconstructing the integral self to make him or her more complex yet whole, thereby giving the self a human and humane integrity.