Rich Folks Who Blame Adam Smith
Rebekah and Stephen Hren writing in The Huffington Post (‘the internet newspaper’), 14 October, HERE:
“The First Death Rattle of Our Unsustainable Economy (Part II)”
“The second huge contradiction goes back to Adam Smith and The Wealth of Nations. Not many folks we know have actually read this book, it's a hefty tome and the lengthy digression on silver incomprehensible, but since it supposedly underpins our economic system it's worth referring to every now and then. Many folks would be surprised to find how vociferous Mr. Smith is in his call for government regulation of markets, and his belief that ultimately the wealth of a nation should be measured by the living standards of its people, not by the height of accumulated piles of material goods. Mr. Smith points out that, as we all know, division of labor increases productivity. But what Mr. Smith passes over is that this increased production of material goods comes at a hefty price: tedious, repetitive work often isolated from our surrounding natural environment. Since satisfaction in our work declines as it becomes more isolated from the whole and more repetitive, it becomes necessary for us to gain our satisfaction in life away from our work and instead we often look for satisfaction via the things we consume. Unfortunately, it is impossible to find any lasting satisfaction through consuming things (just ask your belly), and, the physical world being finite, we eventually run out of things to consume.
Since our current economic system is riddled with contradictions that are forcing its implosion as it abuts the physical limits of our planet, what do we do next? Fortunately some very smart people have been ruminating on this subject for the last few decades, and we'll take a look at what they have to say in our next entry.”
Comment
I am always cautious about appearing to take seriously the folksy approach to Adam Smith which measures his worth by the weight of his Wealth Of Nations (would they remark the same about the size and weight of the Oxford English Dictionary?), or his alleged ‘incomprehensible’ digression on silver’ (we call it ‘evidence’ in scholarship, Rebekah and Stephen!).
Our Huffington authors claim that Adam Smith believed “the wealth of a nation should be measured by the living standards of its people, not by the height of accumulated piles of material goods”.
Strange, I must say, but then it’s not clear if they got beyond their incomprehension about the significance of silver. If they had done so, they would have noticed that Adam Smith defines wealth several times as the ‘annual production of the necessaries, conveniences, and amusements of life’, which may be regarded as total output per year goods, even, dare I say, figuratively, the “height of accumulated piles of material goods”!
His concern with the distribution of income in 18th-century Britain was with the basic poverty of the bulk of the population of day labourers and their families, whose only prospect of sharing in wealth was from employment from the growth of the economy.
Have Rebekah and Stephen actually read Wealth Of Nations or are they relying on R. J. O’Rourke’s amusing, but unreliable, version of it? I ask, not intentionally I assure readers, this impertinent question because they write that “Mr. Smith points out that, as we all know, division of labor increases productivity. But what Mr. Smith passes over is that this increased production of material goods comes at a hefty price: tedious, repetitive work often isolated from our surrounding natural environment.”
[Digression!]Why the use of “Mr”? He has a first name, Adam, which they could use, but if that is too informal for someone they have not been introduced to (it’s down to the mores of their social class) they could have used ‘Professor Smith’ or “Dr Smith”.
Now back to the ‘division of labour’. Yes, the example of the pin factory certainly shows that the productivity of labour increases through the arrangements that take advantage of the division of labour. But this was not something Adam Smith discovered; it was known long before the 18th Century by many philosophers and scholars. Smith never claimed that he invented the idea of the division of labour, nor that the world waited until Wealth Of Nations to utilise it.
Indeed, the evidence that Smith draws upon to make his points on enhanced productivity from the pin factory he visited is similar to accounts of pin factories in France. [If interested in evidence, Rebekah and Stephen can read the article by J-L. Peaucelle, 2006, ‘Adam Smith’s use of multiple references for his pin-making examples’, in the European Journal of the History of Economic Thought, vol13:4, pp 480-512]
Our authors, Mr. and Mrs. Hren, write:
“But what Mr. Smith passes over is that this increased production of material goods comes at a hefty price: tedious, repetitive work often isolated from our surrounding natural environment”.
Excuse me for being impatient, though not I hope, impertinent, but how could they write such breathtaking nonsense, for that is what it is, when ‘Mr. Smith’ did precisely the opposite to what they allege he ‘passes over’:
“In the progress of the division of labour, the employment of the far greater part of those who live by labour, that is, of the great body of the people, comes to be confined to a few very simple operations, frequently to one or two. But the understandings of the greater part of men are necessarily formed by their ordinary employments. The man whose whole life is spent in performing a few simple operations, of which the effects are perhaps always the same, or very nearly the same, has no occasion to exert his understanding or to exercise his invention in finding out expedients for removing difficulties which never occur. He naturally loses, therefore, the habit of such exertion, and generally becomes as stupid and ignorant as it is possible for a human creature to become. The torpor of his mind renders him not only incapable of relishing or bearing a part in any rational conversation, but of conceiving any generous, noble, or tender sentiment, and consequently of forming any just judgment concerning many even of the ordinary duties of private life. Of the great and extensive interests of his country he is altogether incapable of judging, and unless very particular pains have been taken to render him otherwise, he is equally incapable of defending his country in war. The uniformity of his stationary life naturally corrupts the courage of his mind, and makes him regard with abhorrence the irregular, uncertain, and adventurous life of a soldier. It corrupts even the activity of his body, and renders him incapable of exerting his strength with vigour and perseverance in any other employment than that to which he has been bred. His dexterity at his own particular trade seems, in this manner, to be acquired at the expence of his intellectual, social, and martial virtues. But in every improved and civilized society this is the state into which the labouring poor, that is, the great body of the people, must necessarily fall, unless government takes some pains to prevent it.” [WN V.i.f.50: pp 781-2]
I ask again: have our Huffington authors read Wealth Of Nations or did they only flick through it, their wrists straining to hold up the book, and thereby miss the above paragraph? Did they adopt the implication of their statement that “it's worth referring to every now and then”, but between their ‘now’ and the ‘then’, they missed out Book V, pages 781-2?
They write: “Unfortunately, it is impossible to find any lasting satisfaction through consuming things (just ask your belly), and, the physical world being finite, we eventually run out of things to consume.”
Obviously, Rebekah and Stephen have reached that surfeit of consumables that they have “run out of things to consume”, which is way beyond what the majority of the world’s population can achieve even if they trebled many times over what they earn at present (our authors could offer to swap their exhausted life styles for a random poor couple blocks away from wherever they live).
Adam Smith had plenty to say about this condition from the vantage point of mid-18th-century Scotland, which was hardly a consumer paradise. In his Moral Sentiments (1759) he relates the parable of the ‘poor man’s son, whom heaven in its anger has visited with ambition’. I shall make a small quotation from it – it being too long to lengthen this post as it stands, but well worth close study by Rebekah and Stephen as they look around their home in shame and apparent disgust at what they have accumulated:
“The poor man's son, whom heaven in its anger has visited with ambition, when he begins to look around him, admires the condition of the rich. He finds the cottage of his father too small for his accommodation, and fancies he should be lodged more at his ease in a palace. He is displeased with being obliged to walk a-foot, or to endure the fatigue of riding on horseback. He sees his superiors carried about in machines, and imagines that in one of these he could travel with less inconveniency. He feels himself naturally indolent, and willing to serve himself with his own hands as little as possible; and judges, that a numerous retinue of servants would save him from a great deal of trouble. He thinks if he had attained all these, he would sit still contentedly, and be quiet, enjoying himself in the thought of the happiness and tranquillity of his situation. He is enchanted with the distant idea of this felicity. It appears in his fancy like the life of some superior rank of beings, and, in order to arrive at it, he devotes himself for ever to the pursuit of wealth and greatness. To obtain the conveniencies which these afford, he submits in the first year, nay in the first month of his application, to more fatigue of body and more uneasiness of mind than he could have suffered through the whole of his life from the want of them. He studies to distinguish himself in some laborious profession. With the most unrelenting industry he labours night and day to acquire talents superior to all his competitors. He endeavours next to bring those talents into public view, and with equal assiduity solicits every opportunity of employment. For this purpose he makes his court to all mankind; he serves those whom he hates, and is obsequious to those whom he despises. Through the whole of his life he pursues the idea of a certain artificial and elegant repose which he may never arrive at, for which he sacrifices a real tranquillity that is at all times in his power, and which, if in the extremity of old age he should at last attain to it, he will find to be in no respect preferable to that humble security and contentment which he had abandoned for it. It is then, in the last dregs of life, his body wasted with toil and diseases, his mind galled and ruffled by the memory of a thousand injuries and disappointments which he imagines he has met with from the injustice of his enemies, or from the perfidy and ingratitude of his friends, that he begins at last to find that wealth and greatness are mere trinkets of frivolous utility, no more adapted for procuring ease of body or tranquillity of mind than the tweezer-cases of the lover of toys; and like them too, more troublesome to the person who carries them about with him than all the advantages they can afford him are commodious.” (TMS IV.1.8: p 181)
Please read the rest of this chapter. It is most enlightening of Adam Smith’s real views and not what quotation grabbers extrapolate from their imaginations. As for Rebekah and Stephen’s thesis in their articles (with another one to come), I shall leave readers to make their own minds up about them – Lost Legacy’s interests are confined to the misuses of Adam Smith’s legacy and not the aimless discontents of wealthy authors and readers of the Huffington Post.
“The First Death Rattle of Our Unsustainable Economy (Part II)”
“The second huge contradiction goes back to Adam Smith and The Wealth of Nations. Not many folks we know have actually read this book, it's a hefty tome and the lengthy digression on silver incomprehensible, but since it supposedly underpins our economic system it's worth referring to every now and then. Many folks would be surprised to find how vociferous Mr. Smith is in his call for government regulation of markets, and his belief that ultimately the wealth of a nation should be measured by the living standards of its people, not by the height of accumulated piles of material goods. Mr. Smith points out that, as we all know, division of labor increases productivity. But what Mr. Smith passes over is that this increased production of material goods comes at a hefty price: tedious, repetitive work often isolated from our surrounding natural environment. Since satisfaction in our work declines as it becomes more isolated from the whole and more repetitive, it becomes necessary for us to gain our satisfaction in life away from our work and instead we often look for satisfaction via the things we consume. Unfortunately, it is impossible to find any lasting satisfaction through consuming things (just ask your belly), and, the physical world being finite, we eventually run out of things to consume.
Since our current economic system is riddled with contradictions that are forcing its implosion as it abuts the physical limits of our planet, what do we do next? Fortunately some very smart people have been ruminating on this subject for the last few decades, and we'll take a look at what they have to say in our next entry.”
Comment
I am always cautious about appearing to take seriously the folksy approach to Adam Smith which measures his worth by the weight of his Wealth Of Nations (would they remark the same about the size and weight of the Oxford English Dictionary?), or his alleged ‘incomprehensible’ digression on silver’ (we call it ‘evidence’ in scholarship, Rebekah and Stephen!).
Our Huffington authors claim that Adam Smith believed “the wealth of a nation should be measured by the living standards of its people, not by the height of accumulated piles of material goods”.
Strange, I must say, but then it’s not clear if they got beyond their incomprehension about the significance of silver. If they had done so, they would have noticed that Adam Smith defines wealth several times as the ‘annual production of the necessaries, conveniences, and amusements of life’, which may be regarded as total output per year goods, even, dare I say, figuratively, the “height of accumulated piles of material goods”!
His concern with the distribution of income in 18th-century Britain was with the basic poverty of the bulk of the population of day labourers and their families, whose only prospect of sharing in wealth was from employment from the growth of the economy.
Have Rebekah and Stephen actually read Wealth Of Nations or are they relying on R. J. O’Rourke’s amusing, but unreliable, version of it? I ask, not intentionally I assure readers, this impertinent question because they write that “Mr. Smith points out that, as we all know, division of labor increases productivity. But what Mr. Smith passes over is that this increased production of material goods comes at a hefty price: tedious, repetitive work often isolated from our surrounding natural environment.”
[Digression!]Why the use of “Mr”? He has a first name, Adam, which they could use, but if that is too informal for someone they have not been introduced to (it’s down to the mores of their social class) they could have used ‘Professor Smith’ or “Dr Smith”.
Now back to the ‘division of labour’. Yes, the example of the pin factory certainly shows that the productivity of labour increases through the arrangements that take advantage of the division of labour. But this was not something Adam Smith discovered; it was known long before the 18th Century by many philosophers and scholars. Smith never claimed that he invented the idea of the division of labour, nor that the world waited until Wealth Of Nations to utilise it.
Indeed, the evidence that Smith draws upon to make his points on enhanced productivity from the pin factory he visited is similar to accounts of pin factories in France. [If interested in evidence, Rebekah and Stephen can read the article by J-L. Peaucelle, 2006, ‘Adam Smith’s use of multiple references for his pin-making examples’, in the European Journal of the History of Economic Thought, vol13:4, pp 480-512]
Our authors, Mr. and Mrs. Hren, write:
“But what Mr. Smith passes over is that this increased production of material goods comes at a hefty price: tedious, repetitive work often isolated from our surrounding natural environment”.
Excuse me for being impatient, though not I hope, impertinent, but how could they write such breathtaking nonsense, for that is what it is, when ‘Mr. Smith’ did precisely the opposite to what they allege he ‘passes over’:
“In the progress of the division of labour, the employment of the far greater part of those who live by labour, that is, of the great body of the people, comes to be confined to a few very simple operations, frequently to one or two. But the understandings of the greater part of men are necessarily formed by their ordinary employments. The man whose whole life is spent in performing a few simple operations, of which the effects are perhaps always the same, or very nearly the same, has no occasion to exert his understanding or to exercise his invention in finding out expedients for removing difficulties which never occur. He naturally loses, therefore, the habit of such exertion, and generally becomes as stupid and ignorant as it is possible for a human creature to become. The torpor of his mind renders him not only incapable of relishing or bearing a part in any rational conversation, but of conceiving any generous, noble, or tender sentiment, and consequently of forming any just judgment concerning many even of the ordinary duties of private life. Of the great and extensive interests of his country he is altogether incapable of judging, and unless very particular pains have been taken to render him otherwise, he is equally incapable of defending his country in war. The uniformity of his stationary life naturally corrupts the courage of his mind, and makes him regard with abhorrence the irregular, uncertain, and adventurous life of a soldier. It corrupts even the activity of his body, and renders him incapable of exerting his strength with vigour and perseverance in any other employment than that to which he has been bred. His dexterity at his own particular trade seems, in this manner, to be acquired at the expence of his intellectual, social, and martial virtues. But in every improved and civilized society this is the state into which the labouring poor, that is, the great body of the people, must necessarily fall, unless government takes some pains to prevent it.” [WN V.i.f.50: pp 781-2]
I ask again: have our Huffington authors read Wealth Of Nations or did they only flick through it, their wrists straining to hold up the book, and thereby miss the above paragraph? Did they adopt the implication of their statement that “it's worth referring to every now and then”, but between their ‘now’ and the ‘then’, they missed out Book V, pages 781-2?
They write: “Unfortunately, it is impossible to find any lasting satisfaction through consuming things (just ask your belly), and, the physical world being finite, we eventually run out of things to consume.”
Obviously, Rebekah and Stephen have reached that surfeit of consumables that they have “run out of things to consume”, which is way beyond what the majority of the world’s population can achieve even if they trebled many times over what they earn at present (our authors could offer to swap their exhausted life styles for a random poor couple blocks away from wherever they live).
Adam Smith had plenty to say about this condition from the vantage point of mid-18th-century Scotland, which was hardly a consumer paradise. In his Moral Sentiments (1759) he relates the parable of the ‘poor man’s son, whom heaven in its anger has visited with ambition’. I shall make a small quotation from it – it being too long to lengthen this post as it stands, but well worth close study by Rebekah and Stephen as they look around their home in shame and apparent disgust at what they have accumulated:
“The poor man's son, whom heaven in its anger has visited with ambition, when he begins to look around him, admires the condition of the rich. He finds the cottage of his father too small for his accommodation, and fancies he should be lodged more at his ease in a palace. He is displeased with being obliged to walk a-foot, or to endure the fatigue of riding on horseback. He sees his superiors carried about in machines, and imagines that in one of these he could travel with less inconveniency. He feels himself naturally indolent, and willing to serve himself with his own hands as little as possible; and judges, that a numerous retinue of servants would save him from a great deal of trouble. He thinks if he had attained all these, he would sit still contentedly, and be quiet, enjoying himself in the thought of the happiness and tranquillity of his situation. He is enchanted with the distant idea of this felicity. It appears in his fancy like the life of some superior rank of beings, and, in order to arrive at it, he devotes himself for ever to the pursuit of wealth and greatness. To obtain the conveniencies which these afford, he submits in the first year, nay in the first month of his application, to more fatigue of body and more uneasiness of mind than he could have suffered through the whole of his life from the want of them. He studies to distinguish himself in some laborious profession. With the most unrelenting industry he labours night and day to acquire talents superior to all his competitors. He endeavours next to bring those talents into public view, and with equal assiduity solicits every opportunity of employment. For this purpose he makes his court to all mankind; he serves those whom he hates, and is obsequious to those whom he despises. Through the whole of his life he pursues the idea of a certain artificial and elegant repose which he may never arrive at, for which he sacrifices a real tranquillity that is at all times in his power, and which, if in the extremity of old age he should at last attain to it, he will find to be in no respect preferable to that humble security and contentment which he had abandoned for it. It is then, in the last dregs of life, his body wasted with toil and diseases, his mind galled and ruffled by the memory of a thousand injuries and disappointments which he imagines he has met with from the injustice of his enemies, or from the perfidy and ingratitude of his friends, that he begins at last to find that wealth and greatness are mere trinkets of frivolous utility, no more adapted for procuring ease of body or tranquillity of mind than the tweezer-cases of the lover of toys; and like them too, more troublesome to the person who carries them about with him than all the advantages they can afford him are commodious.” (TMS IV.1.8: p 181)
Please read the rest of this chapter. It is most enlightening of Adam Smith’s real views and not what quotation grabbers extrapolate from their imaginations. As for Rebekah and Stephen’s thesis in their articles (with another one to come), I shall leave readers to make their own minds up about them – Lost Legacy’s interests are confined to the misuses of Adam Smith’s legacy and not the aimless discontents of wealthy authors and readers of the Huffington Post.
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