The Home of American Intellectual Conservatism — First Principles

December 14, 2017

REFERENCE DESK
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Smith, Adam
Ian Crowe - 05/17/12

In the Wealth of Nations, Smith examines the stages of the development of systems of political economy but concentrates on advanced commercial societies to show how public benefit can emerge from the private pursuit of self-interest and how government can foster social harmony through the promotion of natural liberty among its subjects. It is the introduction of the division of labor that creates the conditions for opulence and a commercial society that reflects an advanced and natural (though not inevitable) form of mutual cooperation. The wealth of nations, then, is to be measured in terms of productive capacity and not in bullion—a point that leads Smith to an extended demolition of mercantilism and its interventionist policies (with reference to the exploitation and economic health of colonies and the impoverishing effect of wider restrictive factors such as monopolies and inappropriate forms of taxation). Smith then delineates the proper role of the public power—again, emphasizing areas that will promote the free exchange of goods and the mobility of labor in particular.

We are, however, not presented with a simplistic parallel between material and moral progress. On the contrary, in the final sections of the book, perhaps as a prelude to his unfinished third work, Smith issues warnings about the moral impact of opulence and the division of labor (seeing, for example, a legitimate role for government in ensuring the provision of basic education at a parish level) and emphasizes the need for governors to guard against purely sectional pressure from the mercantile and manufacturing interests.

For conservatives, one of the most attractive aspects of the Wealth of Nations lies in the link between “natural liberty” and economic practice, with its consequent skepticism about the beneficial effects of government planning; but the implications of Smith’s thought require an awareness of the nature and significance of the links between political economy and his moral philosophy. These links have often been simplified or overlooked by conservatives in their preoccupation with the struggle against socialism and the planned economy, while their enemies, in their assaults upon capitalism, have tended to ignore the distinctions that Smith attempted to maintain between the principles of motivation and those of judgment. In particular, Smith’s famous image of an “invisible hand” conjuring common benefits from self-interested actions should not be interpreted either as a mechanical truth of human existence or as the working out of an unfathomable Providence.

Regarding Smith’s broader analytical method, the naturalness of his system and the underlying, empirical contingency of its principles are also attractive to conservatives, as is Smith’s integrative method, which produces a blend of attention to circumstance and diversity while recognizing the cohesion and unity of human nature under its Creator. More problematic, however, has been the historicist ingredient within that system. Furthermore, Smith’s dynamic faith in progress seems to leave little room for the aristocratic practices and communal patterns of the past, and his idea of true patriotism, mirroring his critique of mercantilism, subordinates the historic claims of political sovereignty to the broader benefits of free trade.

Further Reading
  • Muller, Jerry Z. Adam Smith in His Time and Ours: Designing the Decent Society. Princeton, N.J.: Princeton University Press, 1995.
  • Smith, Adam. The Essential Adam Smith. Edited by Robert L. Heilbroner. New York: W. W. Norton, 1987
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