Bread from the Baker

I had just read an op-ed piece in the New York Times from John Tierney and sat down ingest a small breakfast topped with this statement:

“Hence his famous warning (Adam Smith’s) not to rely on the kindness of strangers outside your family: if you want bread, it's better to count on the baker's self-interest rather than his generosity.”

If one accepts Webster’s definition of cynic, “…one who believes that human conduct is motivated wholly by self-interest”, then this is a purely cynical statement. However, this thought has become tantamount to an axiom of neo-conservative logic – once the conservative debater, masquerading as a libertarian, reduces the argument to this point, he cries, “QED” and the discussion ends, at least in their minds.

Like many dangerous statements, the error of Smith’s admonition, propagated by Tierney, is subtle and elusive. Certainly, if not too much is put in this bucket, it will hold water. Let’s look at a simple thought experiment to see how the pail might leak when overloaded.

Suppose John Dough, our baker, can make 50 loaves of bread per day to serve his little town, and he offers them for sale to the populace. This population apparently can and does live by bread alone, and Dough’s output keeps the town alive and thriving.

One day, Mr. McDuck, the wealthiest person in town arrives at the shop early and offers to buy all of the baker’s wares for much more than the asking price! Why he does this is not important… he may be insulating his house with bread. Nor is the actual price differential important. What is important is that the baker considers only what he immediately sees as his self interest and acts upon this perception. In this case, he sees a highly profitable day for his business and turns over his entire stock of bread to McDuck.

The complications arise immediately. Dough’s daily customers arrive at the shop and are told there is no bread to be bought. Upon learning that Dough has sold his entire stock to McDuck, they call a town meeting. In the first order of business, it is decided that toilets will now be called “Johns” to discredit the baker. In the second order of business, the town’s residents decide to set up a baking cooperative with certain rules that will prevent such events as the one which triggered this meeting.

The new bakery sells bread comparable to Dough’s and because of the negative connotation of buying bread from the toilet, Dough’s bread goes unsold, his business quickly closes and John himself goes to prison for trying to break into the new cooperative bakery to steal bread for his starving family.

This story is simplistic… real life is much more complicated and potential consequences are much harder to predict. But Tierney, like many conservatives, confuses a pragmatic liberal viewpoint with altruism. Altruism is “…unselfish devotion to the welfare of others.” The pragmatic liberal view is not the opposite of self-interest, it’s just enlightened self-interest. Liberals believe that self-interest goes beyond amassing vast personal wealth and that the real bottom line can’t be measured simply in dollars and cents. Like our baker, we must tend to our community not simply because it’s a community – this would be altruism – but because it’s our community and our lives depend upon it. We must protect the environment not just because we love trees but because they’re our source of the oxygen which our lives depend upon! We favor programs to help the poor not just because Jesus told us to (even though he did!!!) but because where starvation and poverty exist, there lies discontent, the crack in the foundation that threatens our entire house.

Bemoaning the lack of respect for selfishness in modern society, Tierney states:

“The result is an enduring political paradox: we no longer live in clans small enough for altruism to be practical, but we still respond to politicians who promise to make us all part of one big selfless community.”

If this opinion is true, then our concept of democracy is outmoded and impractical. If altruism is enlightened self-interest, and such “altruism” is no longer practical, then one cannot make enlightened decisions as a voter. In addition to those politicians who promise to make us one big selfless community, we might find politicians trying to sway our votes by scaring, threatening or lying to us, appealing to our prejudices, or, heaven forbid, bringing the “higher authority” of religion into the debate.

But, pandering aside – practiced on both sides of the political aisle – most policy arguments are efforts to convince voters that one direction is more in their own self interest than the other. Or at least it would be in our aggregate self-interest if they were!

--Jim Stringer / May 2005