The Invisible Hand is White

Adam Smith wrote that the actions of individuals seeking their own self-interest will have an added societal consequence of wealth distributing itself in line with the greatest societal good. This natural wealth distribution has come to be personified in the idea that there is an “invisible hand” controlling the market. This hand steadies, balances, and distributes wealth and resources. This hand is not regulated by any government or body of law, it is natural.

Sometimes we believe that in America, this invisible hand is called “meritocracy”. This market force distributes wealth and resources to those who work hard, who are smart, or in other words, to those who have merit. This idea of making our own way or reaping the rewards of our own labor is one of the founding ideals of the American dream.  In America, if you work hard enough, you can be anything you want. I like the idea and I would even say that in large part, at least compared to many places in the world, we (America) do a relatively good job.

But merit is a funny thing. It can be hard to identify, hard to develop, even harder to measure. Quite often merit is in the eye of the beholder. Perhaps really, merit matters but not in as much a way as we think, or at least it doesn’t matter most. It is difficult for any individual’s merit to carry them outside their sphere of relationships; hence the adage that success hinges on who you know, not what you know. Who you know matters.

Who you know, or better yet, who knows you, matters because that is often who judges what “is” and “is not” merit, and who possesses it.  In a system where individuals and institutions are free to exchange goods or resources as they see fit, those who have the most resources have the most influence on deciding what constitutes merit. Their biases, preferences, and needs are empowered to move, or at least nudge, this giant invisible hand. Consequentially, opportunity and achievement are often based on proximity, availability, reputation, network, and experience.  Merit may play only a sustaining role as opposed to a driving one. It has been that way for a long time. Take George Washington for example.

By all accounts General Washington was full of merit. He worked hard as a surveyor, proactively took risks as a soldier, and his writing shows a more than respectable measure of learning and brilliance. Thanks in large part to this merit he became one of the richest men in America, and even makes the list of one of the relative wealthiest Americans ever. Yet we could, and I would say should, also consider that the one thing Mr. Washington did that had the most direct influence on his wealth and position, was to marry a rich widow. Before that, George was on track to be Nathaniel Green. Mr. Green is respectable by all accounts but he isn’t carved on Mt. Rushmore, doesn’t have a state named after him, and no currency features his face. Washington is the one we all remember yet, by most all accounts, Green was a better general than Washington.

But George was born and lived in a hugely influential tidewater Virginia, and thanks to both inherited and married wealth, George enjoyed a continual revenue independent of his day to day actions which freed him up  to become George Washington rather than Nathaniel Green. But that was a long time ago, things have changed.

People today have infinitely more means and access to build new networks and accrue merit. Public school, Facebook, college, loans, and internships are everywhere and excepting Facebook, have been around for several generations. One result of such network broadening opportunities are instances like the Supreme Court which currently consisting of 8 people, includes 3 women, a Latina, an African-American, 5 Catholics, and 3 Jews. We have come a long way since George Washington. Yet even still with these 8 people with varying backgrounds they all went to either Harvard or Yale. It is not written that one must attend Harvard or Yale to be a Supreme Court Justice, nor is there a class at either school designed to give a student the specific skills they need to be supreme, yet this remains the path.  How and why it matters leaves plenty of room for argument.

Sticking with schools for a moment, when looking at the background of billionaires it is noteworthy that there are groupings of what college these rich people attended. The University of Pennsylvania counts 21 living billionaires among its alumni. Harvard and Yale both have 14. As we move down the list of schools the richest people are largely coming from, or at least passing through, the oldest, richest, and most prestigious universities. Again, is it the curriculum that is creating graduates who go on to such wealth? Do they learn something there that translates to money? Some, like Mark Zuckerberg and Bill Gates who both dropped out of Harvard, don’t ever graduate so their merit cannot be directly tied to their degrees. Yet still there is that clustering or concentration of wealth and success.

We could easily assume that going to college, marrying rich widows, and becoming a billionaire is all part of our meritocratic country where this invisible hand is scooping all the best and brightest into certain schools, is rewarding suitors who are best suited to manage dowries, and simply rewarding those who do the work and are most deserving. But then what about those who catch a bad break? There are of course many who through no fault of their own, are born in unfortunate situations. How does this hand deal with such? Our lore says this hand simply rewards their merit. Meritocracies allow for individuals to pick themselves up by their own bootstraps.

Abraham Lincoln was uneducated and failed at election time and time again. But Honest Abe worked hard reading books and got back in the race after every defeat. Sure he also benefited from a fortuitous marriage, but we could easily argue that he earned that too (winning Mary Todd’s favor and whatnot). Abraham Lincoln was without a doubt, a great man. I make no argument that he did not earn or deserve his renown and place in history.

So does this mean that this free market invisible hand and meritocracy work? Maybe.

But then there is Abraham’s contemporary, Frederick Douglass.

Mr. Douglass, born a slave, was not only never taught to read, but was legally prevented from doing so. But he did. While Abraham Lincoln might have given out country’s most well-known speech, most every one at that time would have agreed that Douglass was a better orator. Douglass escaped slavery, educated himself, and become the first free black man to visit the white house when he went to go plead with President Lincoln for the better treatment of black soldiers. Douglass was indeed able to accomplish great things with his merit, yet he isn’t the one carved on Mt. Rushmore.

Mr. Douglass and Lincoln lived in a time where the law of the land dictated that the rewards for a black person’s merit were expected to be delivered to white people. In fact, in many, if not most cases, the merit of black people itself, not just the rewards, were ascribed to their white masters. For instance, when modern visitors tour George Washington’s home, they are told of Mrs. Washington’s prowess in the kitchen, you can even buy her cookbook in the gift shop. But she wasn’t the one who did the cooking. Black people were doing the cooking but their skills, or merit, were attributed to Martha. A visit to the website today further illustrates how the invisible hand of the 1700’s still effects the modern memory. http://www.mountvernon.org/george-washington/martha-washington/mistress-of-the-household/

But today many Americans see slavery and segregation as unfortunate blips in our ideology or system bearing little effect on our situations today. As if in those days the invisible hand had a finger on the scales of justice, but not anymore. Now the hand is back to balancing markets and allowing merit to be rewarded freely. We have set a new starting point, new zero, called “now” and we just move forward. Is free always fair? Of course not.

I argue a better question is if this modern freedom is just.

If we are living in a true meritocracy then we can assume that those who are rich deserve it, and those who are poor deserve that too. I do not argue that our society believes this specifically, but it does appear that we believe it generally. This belief drives how many of us vote, what we choose to study, and many of the decisions we make in life. It is a foundational idea in the American philosophy. It is part of who we are…

If we are white.

Do black Americans live in a meritocracy? (Do women?)If they do is it the same one as the white men?

For centuries the flow of resources and opportunities were artificially steered away from black individuals. This was not done strictly through laws and regulations but also through ideas. For example, when Thomas Jefferson was writing to persuade the world that a society where all men were created equal and should be free to pursue happiness without being obstructed, he also wrote that this freedom need not apply to black people because they were inferior (Notes on the State of Virginia). Jefferson argued that black people possessed less merit by nature and were incapable of managing resources directly. After reconstruction politicians were quite overt in campaigning on the idea that governing was best done by white people. Many were afraid that black people lacked the necessary skills and intelligence (merit) to govern, or even vote, and that allowing them either would lead to national destruction.Even when laws did not dictate segregation or discrimination, there was an idea that black people were not only less than white people, but were/are also more dangerous. This idea has been rampant and persistent in literature, music, news, business and media since our foundation.  This is not to say that all messages have been so, but these messages have always been in the environment.

This affects our meritocracy not only in that the spheres of influence and opportunity been limited for black people, but also in that the minds of those who determine and measure merit have been marinated in an ideology of white superiority. We as a nation believed that white men naturally possessed more merit.

Most of us are uncomfortable with this idea-that our minds are tainted- so much so that we have re envisioned how we collectively remember Martin Luther King Jr. and Mohammed Ali. We have honored Rosa Parks and lauded Booker T. Washington. We have worked hard enough to remove this mental poison that many of us now believe ourselves inoculated.  We in, large part, believe our society is free and safe from smallpox, mumps, and racism. Perhaps there may be the odd case or diagnosis, but they do not apply to the public. The meritocracy is safe.

Is this true? Are we a meritocracy?

When neighborhoods and schools are segregated both racially and economically, but laws do not require such, how do we explain or interpret the situation? When there is a disparity between black and white along the lines of wealth, academic achievements, and health, how do we explain that? Why the gap if our meritocracy is sound? Why are black people stopped, arrested, and incarcerated at rates higher than their white peers?

Why?

Are we all just getting what we deserve? Are we all simply rising to the appropriate level with regard to our merit? We have had black doctors, a black president, black secretary of state, black Supreme Court justice, and black billionaire, so there is apparently no strict cap on American black achievement. But yet that gap. These success stories are not the statistical or relative norm.

Why?

Maybe the invisible hand is white.