Skip to main content

The world has changed a great deal since the time of Adam Smith.  So much of humanity now lives in industrial or "post-industrial" societies.  People in developing nations often have cell phones, while in Adam Smith's time there wasn't even a telegraph office in rich nations.  Our societies are in desperate need of something beyond what Adam Smith could imagine a couple of centuries ago.  Yet, in order to maintain the status quo in favor of the 1%, some of the political and economic claims we hear (sometimes alleging to be based on Adam Smith) are actually backward even from the centuries-old view of Adam Smith.  Consider the following quotes.

Progressive taxation:
“It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.”

Poverty:
“No society can surely be flourishing and happy of which by far the greater part of the numbers are poor and miserable.”

Inequality:
“Wherever there is great property there is great inequality. For one very rich man there must be at least five hundred poor, and the affluence of the few supposes the indigence of the many.”

Business groups acting against the public:
“People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.”

Higher wages affect prices less than higher profits:
“In regards to the price of commodities, the rise of wages operates as simple interest does, the rise of profit operates like compound interest. Our merchants and masters complain much of the bad effects of high wages in raising the price and lessening the sale of goods. They say nothing concerning the bad effects of high profits. They are silent with regard to the pernicious effects of their own gains. They complain only of those of other people.”

Empathy:
“Though our brother is upon the rack, as long as we ourselves are at ease, our senses will never inform us of what he suffers. They never did and never can carry us beyond our own persons, and it is by the imagination only that we form any conception of what are his sensations...His agonies, when they are thus brought home to ourselves, when we have this adopted and made them our own, begin at last to affect us, and we then tremble and shudder at the thought of what he feels.”  - from The Theory of Moral Sentiments

Government acting on behalf of the rich:
“Civil government, so far as it is instituted for the security of property, is in reality instituted for the defense of the rich against the poor, or of those who have some property against those who have none at all.”

These quotes go back over 200 years.  We live in a changed world in which Adam Smith's preferred policies are no longer the right choice for the 21st century.  (There are plenty of quotes one could take from Smith which would be similar to some conservative views.)  However, we shouldn't let conservatives advocate following in Smith's footsteps, while ignoring this side of Adam Smith which contradicts some basic conservative tenets.

EMAIL TO A FRIEND X
Your Email has been sent.
You must add at least one tag to this diary before publishing it.

Add keywords that describe this diary. Separate multiple keywords with commas.
Tagging tips - Search For Tags - Browse For Tags

?

More Tagging tips:

A tag is a way to search for this diary. If someone is searching for "Barack Obama," is this a diary they'd be trying to find?

Use a person's full name, without any title. Senator Obama may become President Obama, and Michelle Obama might run for office.

If your diary covers an election or elected official, use election tags, which are generally the state abbreviation followed by the office. CA-01 is the first district House seat. CA-Sen covers both senate races. NY-GOV covers the New York governor's race.

Tags do not compound: that is, "education reform" is a completely different tag from "education". A tag like "reform" alone is probably not meaningful.

Consider if one or more of these tags fits your diary: Civil Rights, Community, Congress, Culture, Economy, Education, Elections, Energy, Environment, Health Care, International, Labor, Law, Media, Meta, National Security, Science, Transportation, or White House. If your diary is specific to a state, consider adding the state (California, Texas, etc). Keep in mind, though, that there are many wonderful and important diaries that don't fit in any of these tags. Don't worry if yours doesn't.

You can add a private note to this diary when hotlisting it:
Are you sure you want to remove this diary from your hotlist?
Are you sure you want to remove your recommendation? You can only recommend a diary once, so you will not be able to re-recommend it afterwards.
Rescue this diary, and add a note:
Are you sure you want to remove this diary from Rescue?
Choose where to republish this diary. The diary will be added to the queue for that group. Publish it from the queue to make it appear.

You must be a member of a group to use this feature.

Add a quick update to your diary without changing the diary itself:
Are you sure you want to remove this diary?
(The diary will be removed from the site and returned to your drafts for further editing.)
(The diary will be removed.)
Are you sure you want to save these changes to the published diary?

Comment Preferences

  •  They cherry-pick Wealth of Nations (7+ / 0-)

         just like they cherry-pick the Bible. Smith was a progressive.

    The free market is not the solution, the free market is the problem.

    by Azazello on Wed Jan 30, 2013 at 09:17:27 AM PST

  •  Good on you! Adam Smith is well worth reading. (7+ / 0-)

    Your first Smith quote is good, but in my opinion incomplete. The context around it is worthy of quotation as well:

    The proportion of the expence of house-rent to the whole expence of living is different in the different degrees of fortune. It is perhaps highest in the highest degree, and it diminishes gradually through the inferior degrees, so as in general to be lowest in the lowest degree. The necessaries of life occasion the great expense of the poor. They find it difficult to get food, and the greater part of their little revenue is spent in getting it. The luxuries and vanities of life occasion the principal expense of the rich, and a magnificent house embellishes and sets off to the best advantage all the other luxuries and vanities which they possess. A tax upon house-rents, therefore, would in general fall heaviest upon the rich; and in this sort of inequality there would not, perhaps, be anything very unreasonable. It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    Also, in regard to taxation there is another fun Smith quote, very clearly something Marx had read and seemingly perfectly designed to make heads explode on the Right, at least so long as the last nine words are included:
    The subjects of every state ought to contribute towards the support of the government, as nearly as possible, in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the state. The expense of government to the individuals of a great nation is like the expense of management to the joint tenants of a great estate, who are all obliged to contribute in proportion to their respective interests in the estate.

    My country, right or wrong; if right, to be kept right; and if wrong, to be set right.
    --Carl Schurz, remarks in the Senate, February 29, 1872

    by leftist vegetarian patriot on Wed Jan 30, 2013 at 09:30:06 AM PST

    •  revenue (3+ / 0-)

      It's not only those who'd be called "conservatives" today who don't support sufficiently progressive revenue.  Today's federal income tax rates for wages have several brackets from $0 to $400,000 - but there are no further brackets for $4 million or $40 million.  "Long-term capital gains" and "qualified dividends" still have a top rate that's about half the top rate for wages.  Meanwhile, there's some movement in the charity community promoting the idea a fair calculation of a humane level of charitable donation should be based on a percentage of a person's wealth / assets rather than income.  Adopting a wealth tax rather than income tax would make it more progressive.  But one hears little of this from politicians & media.

  •  Adam Smith's economic theory ... (2+ / 0-)

    ... was based on the premise (if I recall my ancient economics professor correctly) that a necessary element was that society cared about the less fortunate.

    Wish I could remember his exact words, but that was 1978 and my major was IT.

    "The fears of one class of men are not the measure of the rights of another." ~ George Bancroft (1800-1891)

    by JBL55 on Wed Jan 30, 2013 at 12:35:07 PM PST

    •  hmm (2+ / 0-)

      From the quotes I gave, one would conclude Smith saw there were problems in the suffering of the less fortunate.  On the other hand, one quote I chose not to include said that each man acts selfishly, but the 'invisible hand' causes the end result to benefit society.  I'm not an expert on Smith so I can't say how the whole of his beliefs looked after these pieces were put together.

      •  I think the idea was that ... (1+ / 0-)
        Recommended by:
        leftist vegetarian patriot

        ... he assumed society would not let the least of these be trodden under, and didn't think it even needed to be stated.

        Like a fish not talking about the water in which he swims because he's not consciously aware of it.

        And yes, I recently read David Foster Wallace's commencement speech for the first time so the analogy is front & center.  :-)

        "The fears of one class of men are not the measure of the rights of another." ~ George Bancroft (1800-1891)

        by JBL55 on Wed Jan 30, 2013 at 01:06:31 PM PST

        [ Parent ]

        •  He did lay it partly out once that I recall (2+ / 0-)
          Recommended by:
          JBL55, RunawayRose
          Servants, labourers and workmen of different kinds, make up the far greater part of every great political society. But what improves the circumstances of the greater part can never be regarded as an inconvenience to the whole. No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable. It is but equity, besides, that they who feed, clothe and lodge the whole body of the people, should have such a share of the produce of their own labour as to be themselves tolerably well fed, cloathed and lodged.

          Wealth of Nations, I .viii.36

          Of course there he is still talking about workers, but although it has been over a year since I last opened my copy at home, perhaps closer to two, he might well have said it more often or explicitly. His two books express the thoughts of a decent man, nothing like the morally stunted crew who attempt to hijack his words to exalt some Randian ideal.

          My country, right or wrong; if right, to be kept right; and if wrong, to be set right.
          --Carl Schurz, remarks in the Senate, February 29, 1872

          by leftist vegetarian patriot on Wed Jan 30, 2013 at 02:01:33 PM PST

          [ Parent ]

      •  That "invisible hand" phrase (1+ / 0-)
        Recommended by:
        LanceBoyle

        constitutes his most famous and enduring contribution to popular culture, and it does have some general applicability. He actually used the phrase twice, once in each book. However, in Wealth of Nations, which is where it is best known from, it was practically a throwaway line:

        But the annual revenue of every society is always precisely equal to the exchangeable value of the whole annual produce of its industry, or rather is precisely the same thing with that exchangeable value. As every individual, therefore, endeavours as much as he can both to employ his capital in the support of domestic industry, and so to direct that industry that its produce may be of the greatest value; every individual necessarily labours to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, 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. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good. It is an affectation, indeed, not very common among merchants, and very few words need be employed in dissuading them from it.
        In his Theory of Moral Sentiments, he used the words in a different sense:
        The produce of the soil maintains at all times nearly that number of inhabitants which it is capable of maintaining. The rich only select from the heap what is most precious and agreeable. They consume little more than the poor, and in spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they propose from the labours of all the thousands whom they employ, be the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants, and thus without intending it, without knowing it, advance the interest of the society, and afford means to the multiplication of the species.
        He never actually used the phrase as it is best known today, "the invisible hand of the marketplace".

        My country, right or wrong; if right, to be kept right; and if wrong, to be set right.
        --Carl Schurz, remarks in the Senate, February 29, 1872

        by leftist vegetarian patriot on Wed Jan 30, 2013 at 01:17:43 PM PST

        [ Parent ]

  •  A 'Free Market' (1+ / 0-)
    Recommended by:
    leftist vegetarian patriot

    was a market free of rents and costs not associated with production. It definitely included government regulation.

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site