GROWTH OF THE LIBERAL ILLUSION.

A system of exchange can easily have unintended consequences, consequences that can have a catastrophic effect on the fates of thousands of people while other parties to the system go on as before, blithely ignorant of the impact of their actions. Each participant sees only a tiny part of the whole. For the rest each must depend on hearsay. This was the dilemma that piqued European thinkers to reflect on trade with a new urgency in the seventeenth and eighteenth centuries. The vicissitudes of commerce increased with its volume; the reversals and uncertainties and bitter surprises to which it gave rise forced on consciousness a need to grasp the systemic underpinnings of trade's unintended consequences. Strangely, however, the eventual outcome of this reflection was a doctrine of indifference. The existence of system was perceived, but once perceived it was declared best left alone. The individual's ignorant carrying out of his business, indifferent to the larger consequences, was discovered to be beneficial to the whole. Western thinkers no sooner gained a new insight into the systemic nature of exchange relationships than they renounced all use of it. How did this come about? THE DOCTRINE OF EQUAL EXCHANGE The forms of exchange that a new group of economic theorizers wished to defend in seventeenth-century England were undoubtedly grounded in a desire for monetary profit. Speculation in grain, lending at interest, foreign currency transactions, and enclosures of common land were all highly structured established practices that involved individuals who had no desire to create broader, multivalent relationships with one another. [ABSTRACT FROM AUTHOR]