Reading practice 52

Ted Stumbacher, head of the Global Empowerment Initiative, believes that truly effective philanthropy will need to have at its roots a more economic mindset. He feels religious organizations often provide only a temporary reprieve from suffering related to food, clothing, or shelter. While a noble end, this type of charity succeeds more in establishing a life-long commitment to philanthropy among the churchgoing public than it does in remedying any of the systemic problems that face the world's impoverished masses.

Additionally, the "invisible hand" has come to stand for the resilience of the market after apparently ruinous circumstances. Smith posited that markets naturally recover without intervention on the part of government or similar regulatory bodies. For example, should a product be in excess production, its price in the market would fall, providing incentive for the public to purchase it, thus reducing the stock. This kind of reaction leads to the "natural price" of a good or service, which, Smith believed, was the production cost plus a reasonable profit. This idea would become central to the doctrine of the laissez-faire economists several generations later.

Adam Smith's Wealth of Nations was written for the masses and is generally accepted as the first treatise on economics. For these reasons, the book is thoroughly studied; for the theory within, Smith's magnum opus₁ remains controversial. It stresses low government intervention and personal action₂ as the roots of a prosperous market. As societies balance the question of whether and how to manipulate their markets, Smith presents a valuable warning, saying of man, "he intends only his own gain₃, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention."