Virtue and Vice: Looking for the Real Adam Smith

Historians in the News
tags: economics, intellectual history, political economy, Adam Smith

Glory Liu is a lecturer in social studies at Harvard University. She is the author of Adam Smith’s America.


By Paul Sagar


Adam Smith is not who you think he is. Long hailed as the founder of modern economics and the father of capitalism, the 18th-century Scottish thinker was not only an economist and the author of The Wealth of Nations; he was also a moral philosopher and the author of The Theory of Moral Sentiments. Smith considered his work in moral philosophy every bit as important as his work in economics (if not more so), and he continually revised The Theory of Moral Sentiments even after he’d completed The Wealth of Nations. In the sixth and final edition of The Theory of Moral Sentiments, published in 1790, Smith even added a peculiar chapter about the psychology of wealth. Writing about the tendency of so many people to admire the rich and neglect the poor, he denounced this disposition as “the great and most universal cause of the corruption of our moral sentiments.”

How to make sense of the two Adam Smiths has bedeviled scholars for well over a century. In the mid-1800s, long before he became the mascot for the University of Chicago’s style of free market economics, Smith was the subject of a debate among his German readers, who struggled to find a way to reconcile his picture of human nature as naturally sympathetic in The Theory of Moral Sentiments with his picture of the self-interested butchers, bakers, and brewers in The Wealth of Nations. The discovery of Smith’s Lectures on Jurisprudence in 1895 only deepened the question: The Lectures clearly showed that Smith was formulating many of the ideas in The Wealth of Nations a few years after he’d published The Theory of Moral Sentiments.

One way to solve the puzzle of the two Adam Smiths is to combine them. In her 2017 book Private Government, the philosopher Elizabeth Anderson argued that Smith’s vision of a market-oriented society in The Wealth of Nations had a moral impulse behind it. Smith sought to promote social relations that encouraged freedom and equality. Instead of relationships of dependency, subservience, and domination, as under feudalism, he believed that the market had the emancipatory and egalitarian potential to create relationships based on independence, mutual recognition, and equal standing. In another rendering of this argument, articulated by the political theorists Dennis Rasmussen and Ryan Hanley, Smith’s deep concern about economic inequality is linked to our capacity for sympathy and the cultivation of virtue, as he delineated in The Theory of Moral Sentiments. For Smith, Hanley explains, commercialization and the disparities of wealth that come with it “inhibit our most distinctively human trait, namely our capacity for sympathy.”

These combined Smiths let us have our cake and eat it too. We can have free markets, and we can also have morality. We can have economic freedom, but that freedom rests on an orientation—if not a commitment—to one another as moral equals. A capitalist society can’t survive on markets alone; it needs moral defenders as well.

In his new book, Adam Smith Reconsidered: History, Liberty, and the Foundations of Modern Politics, Paul Sagar argues that combining the two Smiths in this way is a mistake. Casting Smith as a moral theorist who was also, ultimately, a defender of commercial society misunderstands him as a thinker, Sagar writes. The Theory of Moral Sentiments was not Smith’s philosophical justification for the political and economic system he described in The Wealth of Nations. Nor was The Wealth of Nations normative in its intent; instead, it was descriptive. The effort to combine the two Smiths also misidentifies the nature of the problem posed by commercial societies. The problem with them is not moral in nature, Sagar asserts, but political.

Read entire article at The Nation

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