For Adam Smith the invisible hand' was the market. But what if at the heart of all free market economics lies an unrecognised paradox? Namely, that all acts of production are self-defeating.

All processes of production are the result of a demand for a product, having produced that product and satisfied the demand the process of production has thereby eliminated its own reason for existing. This means that a product produced or a service rendered is a demand satisfied and therefore a process or a service that is no longer necessary. It is the continual struggle to defeat this paradox that is at the heart of all economics.

The importance of the production paradox is that because of it, higher productivity is a threat to the processes of production that created it. When first a surplus to ones basic needs is created, exchange commences in part as an attempt to maintain production. If a surplus could not be exchanged because demand was satisfied then there would be no point in doing it again. It follows that an economic surplus is also paradoxically a threat to those who gain wealth by exchange.

How then does the act of production survive itself? This can only be done by a renewal of demand and this can only be done two ways: By the subsequent perishing of the product and/or by growth creating new demand.

Therefore at the heart of a market is not simply exchange of supply and demand but the need to renew demand in order to maintain both the existence of the production processes and the processes of exchange. This begins with increased consumption but ultimately develops into a complete pattern of production aimed at maximum growth, waste, turnover and consumption. This is the invisible hand.

Learn more about this author, Peabody Snickersbee.
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