From My Notebook, no.9

Adam Smith, “Theory Of Moral Sentiments“, Part IV.ii.11: 185:

“The same principle, the same love of system, the same regard to the beauty of order, of art and contrivance, frequently serves to recommend those institutions which tend to promote the public welfare. When a patriot exerts himself for the improvement of any part of the public police, his conduct does not always arise from pure sympathy with the happiness of those who are to reap the benefit of it. It is not commonly from a fellow–feeling with carriers and waggoners that a public–spirited man encourages the mending of high roads. When the legislature establishes premiums and other encouragements to advance the linen or woollen manufactures, its conduct seldom proceeds from pure sympathy with the wearer of cheap or fine cloth, and much less from that with the manufacturer or merchant. The perfection of police, the extension of trade and manufactures, are noble and magnificent objects. The contemplation of them pleases us, and we are interested in whatever can tend to advance them. They make part of the great system of government, and the wheels of the political machine seem to move with more harmony and ease by means of them. We take pleasure in beholding the perfection of so beautiful and grand a system, and we are uneasy till we remove any obstruction that can in the least disturb or encumber the regularity of its motions. All constitutions of government, however, are valued only in proportion as they tend to promote the happiness of those who live under them. This is their sole use and end. From a certain spirit of system, however, from a certain love of art and contrivance, we sometimes seem to value the means more than the end, and to be eager to promote the happiness of our fellow–creatures, rather from a view to perfect and improve a certain beautiful and orderly system, than from any immediate sense or feeling of what they either suffer or enjoy. There have been men of the greatest public spirit, who have shown themselves in other respects not very sensible to the feelings of humanity.”

Comment

This is an Interesting passage from TMS.  It follows directly on from his more famous passage discussing the “proud and unfeeling landlord” who is “led by an invisible hand to makes nearly the same distribution of the necessaries of life” etc.

Smith discusses the phenomenon of state officials or representatives who get behind schemes using public money to undertake some project or other (today such a scheme could be about using public money for devote welfare expenditure to address a social problem):

“When the legislature establishes premiums and other encouragements to advance the [insert names here] manufactures, its conduct seldom proceeds from pure sympathy with the wearer of cheap or fine cloth, and much less from that with the manufacturer or merchant.”

From there Smith shows the justification for government:

“The perfection of police,* the extension of trade and manufactures, are noble and magnificent objects. The contemplation of them pleases us, and we are interested in whatever can tend to advance them. They make part of the great system of government, and the wheels of the political machine seem to move with more harmony and ease by means of them.’

[* By “police” Smith referred to its 18^th century meaning: ensuring the wherewithal for the subsistence of the community.]

Notwithstanding the ideal, we should note the quite poor performance of most governments throughout history, which may succeed in achieving some “noble and magnificent objects” but fail in others like public health, public safety, and public welfare.  That is where the role of the entrepreneurs became so important where they flourished, beginning from the 14th century in Europe, and crucially, in a civil society that allowed them dignity (see Deirdre McCloskey, "Bourgeois Dignity") in North-west Europe. 

Some governments fund magnificent buildings, statues, public works, and so on, while the bulk of the population is left destitute and exposed to dangers (pestilence, diseases, violence, wars and invasions and the ravages of natural disasters).

He concludes with a truth for our times too: ”All constitutions of government, however, are valued only in proportion as they tend to promote the happiness of those who live under them. This is their sole use and end.”

How many governments can you identity where they may be judged to have met that measuring rod?  Damn few, I believe, which is, of course, the stuff of political controversies, in which the ideas of economics play their part.  That is why economic ideas are important.