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- Myths About Adam Smith
Answering Adam SmithOne theme that runs through a lot of the essays I write on these philosophers is to advise people to get to know the philosopher they want to answer. It’s really a precursor for answering the argument: if you don’t know it as well as your opponent, you won’t debate it as well. If you know it better, you’ll probably debate it better. For the purposes of this essay, though, I’ll try to predict the way most people will debate the thought of our Mr. Smith, and advise you the best way to tackle that. Due to the fact that most debaters will argue Smith as "Adam Smith endorses free trade, capitalism and the lack of government intervention into the marketplace," I think the best way to tell you how to answer Smith is to explode some myths about our friend Mr. Smith. We'll talk about modern classical liberal thinkers who have tried to reclaim Smith from the economic conservatives, and we'll talk about Smith's own moral notions. Finally, after we're done there, I'll tell you different approach to take. If you think your judge simply won't buy that Smith WASN'T really the founder of capitalism, WOULDN'T really embrace free trade uncritically, etc., then we'll talk about other critiques of his work that you can use. For now, though, let's examine why Smith isn't what you heard he was in your high school classes. Myths About Adam SmithLike anyone whose predominant work was written over two centuries ago, Smith's application to modern society will be disputed about in academic debates - not just high school academic debates, but debates throughout the academy. There are a variety of fronts upon which this battle is being waged. Let's begin with the idea that Adam Smith was "the founder of capitalism." First, Smith's Wealth Of Nations was published in 1776. This was during a truly precapitalist time, if we define capitalism (as most do) as the market-based actions of an industrial economy. In fact, even those high school history teachers I talked about earlier will tell you that a quite different economic system ruled the day - a system called mercantilism, where rich merchants and joint stock companies with state sponsorship (often monarchical sponsorship, as in the case of Columbus) ruled the day. If you had money, or were in good with someone who did, you could start a business and make a lot of cash. If you had a WHOLE lot of money, you could start a transnational enterprise like the Hudson Bay Company or the Dutch East India Company, and make even more money - without being constrained by such niceties as child labor laws, or laws against the slave trade. Smith's Wealth Of Nations was essentially a critique of this mercantilist economic system. Written before factories, before Eli Whitney's cotton gin gave rise to mechanized agriculture in the colonies, Smith's magnum opus basically decried the whole enterprise as hopelessly corrupt, as rich men gathering together to cheat the public out of money and distort markets for their own advantage at the expense of the mass of humanity. Why is he interpreted as a free-market capitalist? Well, partly because his notion of markets hadn't been seen articulated in such a way before. Mostly, though, it is because Smith has stern words for governments. He talks about how government policies serve only to impoverish the nation, how taxation impoverishes the working poor, and matters like that. What people often miss is, his REAL criticisms are reserved for the rich people that those government policies help out. He talks about how the rich obey “the vile maxim of the “masters of mankind": “All for ourselves, and nothing for other people. He discussing how they are guilty of “conspiracies against the public, where prices are fixed to the benefit of the capital-rich cabal. So yes, Smith had some stern rebukes for government and taxes. But he also had a point to that rebuke: taxes shouldn't be used to make the rich richer and the poor poorer. Classical Liberalism Let me start out this section with a notion: If a talented craftsperson creates a work of art out of mere avarice - a desire to mass-produce things that people will buy - "we may admire what he does, but we despise what he is." This is very much in line with classical liberal thought on free and fulfilling work engaged in by choice and done under one's own control. This thought saw its earliest formulation in the 18th century with men like the German thinker Wilhelm von Humboldt. In turn, Humboldt inspired the famous John Stuart Mill - who you may have heard of – as well as Smith himself. Its called Classical because this is the first formulation of this particular idea in this form. Why is it called liberalism? Well, aside from being liberal in its interpretation of human needs - creativity, freedom, intellectual stimulation - thinkers like Smith favored openness in terms of economics as well. That's why, to this day, knocking down trade barriers is called trade "liberalization," in a term that is only marginally accurate, by the way. But I digress. We were talking not just about trade, but also about work, and how the classical liberal would interpret human needs for labor. At the root of human desires, the classical liberal reasons, is the need for creative work. This type of work must be under one's own control in order to be truly fulfilling, for obvious reasons. If you've got an angry boss or a communist party official forcing your hand, it's difficult to be fulfilled. Now, these ideas are very much NOT capitalist ideas. The capitalist ideal - as we've seen formulated by such appalling human beings as Daniel Lapin and earlier Ayn Rand, among others - is the notion that if you can't translate the labor you engage in into money, than that labor is useless. Extending this argument to its logical conclusion, the capitalist argues, humans don't have a right to engage in free and creative work - the laborer must instead rely upon the market to dictate to him or her what she or he must do. You can see how the classical liberal would find this notion abhorrent, indeed morally repugnant. In fact, Noam Chomsky has made the case that Smith himself would find such an idea "pathological" - that is, indicative and representative of a diseased mind. There are other ideas Smith pushed which support this case, as we'll see in just a bit. But first, let's consider some counterarguments that the defenders of Smith-As-Capitalist-Icon are likely to make. There are basically three of them that will be popular. 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