Adam Smith Revisited

The usual take on Adam Smith is that he was the father of modern capitalism, an apologist for man’s greed and ambition, inventor of the notion of the “invisible hand” that would lead to prosperity and happiness for one and all in a capitalistic economy — trickle down, as it were. The fact is that he was much more famous in his day for his moral philosophy as author of  The of Moral Sentiments in which he insisted that human beings were born with a natural sympathy for one another that would temper their dealings and — in the case of capitalism — keep them from gouging one another and making huge profits at the cost of exploiting their workers and screwing one another.  As he said in Moral Sentiments:

“How selfish soever man may be supposed, there are evidently some principles in his nature which interest him in the fortune of others and render this happiness necessary to him, though he derives nothing from it except the pleasure of seeing it.”

Smith’s reference here to the supposed selfishness of human beings is a direct reference to the cynical Bernard Mandeville who insisted that thinkers like Lord Shaftesbury and Adam Smith were all wet to insist that men were naturally virtuous because, in fact, they are selfish and self-seeking. Mandeville’s infamous little book The Fable of the Bees, which develops this theme at length, was severely attacked by an eighteenth century English audience led by thinkers such as Shaftesbury, Bishop Butler, Francis Hutchinson, Edward Gibbon, and Adam Smith who agreed that Mandeville was all wet. The group even included such skeptical thinkers as David Hume, though he was not as vociferous a proponent of the moral sense theory as the others. And these thinkers were supported by John Wesley and his Methodistic followers who were very active, especially among the very poor.  In any event, these  folks were all great minds that comprised what came to be called the Scottish “moral sense” school of philosophy, insisting that humans are born with a natural sensitivity to others, that we all exhibit the “social virtues” of sympathy, benevolence, compassion, and fellow-feeling. As Smith notes, sympathy cannot be a disguised form of self-interest or we could not explain how a man could sympathize with a woman feeling the pains of childbirth. Sympathy is primal; it is not self-interest posing as something else.

The theme was presupposed when he later wrote Wealth of Nations. Very few have read the 900 page book, but they have perused the pages and picked out passages that reinforce their own particular views of the nature of capitalism and the desirability of the capitalistic enterprise to guarantee human happiness. It is not necessary to repeat here what I have written before of Smith’s reservations about raw capitalism, nor to repeat the excellent comments on my blog by Jerry Stark, except to note that Smith had serious concerns about the deleterious effects of the profit motive on human beings.

To be sure, there is no question but that capitalism has improved the lot of most people in this society. We live in a country where the average person has so many things that would have made kings jealous in Smith’s day, we live longer, and we are healthier. But what is noticeably lacking today is the social virtue that Smith presupposed in his treatise. And without moral sensibility, the “fellow-feeling” of which Smith speaks, capitalism is reduced to fierce competition among people who are all reaching for the same goals of fabulous wealth, status, power, and prestige. Somewhere along the line the social virtues that Smith simply assumed were prevalent in humankind have all but disappeared, and the ugly qualities that are accompany capitalism are left unrestrained by the gentler, human sympathies.

The fact is that the eighteenth-century thinkers who founded this nation, who wrote the “Declaration of Independence” and the “Constitution,” all presupposed the very same social virtues that Smith speaks of. They assumed, as James Madison says quite clearly in a number of the Federalist Papers, that virtuous people would elect wise and virtuous leaders who would promote the common good. This was axiomatic in English and American political and moral thought at that time, and was regarded as the sine qua non of a republican government. And yet we look around and fail to see much virtue at all; it has been replaced by the greed and avarice that capitalism breeds when it is not tempered, as Smith simply assumed it would be, by the social virtues. Recall Madison’s comment in Federalist Paper #55:

“Were the pictures which have been drawn of the political jealousies by some among us [Mandeville?] faithful likenesses of the human character, the inference would be that there is not sufficient virtue among men for self-government; that nothing less than the chains of despotism can restrain them from destroying and devouring one another.”

I have spoken before about the transition of the word “virtue” into “value,” and the consequent reduction of virtues to feelings that are not in the least bit shared by all, but are purely subjective and personal. You like what you like and you value what you value; I like and value what I like and value. And that’s an end to it. But this seemingly innocent alteration in the way we look at things and speak about things reflects a deeper attitude toward our fellow human beings, a lack of sympathy and fellow-feeling accompanied by a conviction that there is nothing that is valuable or true, and that human happiness can be bought and paid for by grubbing about in the market place, trading stocks, exploiting our fellow humans, accumulating as much stuff as possible, climbing the political and social ladder, and ignoring our responsibilities to one another.

We have come a long way, baby, in the name of “progress.” What is not so clear is that we are any the happier or that what we have thrown away was not more valuable than what we have kept.

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