Chapter 2: Theories of Change

1. Jean-Baptiste Lamarck challenged the view that species were fixed, stable entities. He claimed that animals kept adjusting to the ever-changing world around them. Life was fluid, forever reshaping itself into new forms in response to shifting circumstances.

2. Baron Cuvier was sure that the earth's creatures were organized into several distinct categories that had not changed since Creation. To him, species were designed so perfectly for their role in nature, they could not possibly have been transformed from other species.

3. Cuvier contended that violent catastrophes had weeded out some of the species stocked on earth at the Creation. Change was not gradual but sporadic and cataclysmic.

4. Adam Smith was the first to grapple seriously with the basic questions of economic life. He argued that individual self-interest held human society together.

5. Smith argued that the inherent diversity of individual talents, combined with the innate human desire to satisfy self-interest, leads members of a society to organize themselves to perform tasks for which they are well suited. Following this logic, he argued against laws restricting free trade. Broader free markets would allow a greater division of labor, which would yield larger quantities of familiar products.

6. The two other founding fathers of classical economics, David Ricardo and Thomas Malthus, also saw the economy as a closed and unchanging system.

7. Ricardo described the economy as what we would now call a "zero-sum game." Only a fixed amount of goods are available to go around, so whatever one group in society gains, the others must lose.

8. Malthus argued that the natural rate of human population growth is geometric and always exceeds the arithmetic rate of increase in food production.

9. By 1833, after nearly 30 years of investigation, debate, and political chicanery, the first serious restrictions on the use of child labor became law. Among those most adamantly opposed were English economists.

10. They adopted Malthus' position that higher levels of government support for the unemployed poor would only lead to more mouths and worse starvation in the future. Malthus' population principle was as controlling as Newton's law of gravity.