I'm hardly the first person to note that "The Adam Smith Problem"--that apparent contradiction between the sympathy ascribed to humanity in The Theory of Moral Sentiments and the self-interestedness ascribed to humanity in The Wealth of Nations--is itself problematic, based as it is on a mistaken premise about what Smith actually argues in these texts. But, revisiting Smith this weekend, I'm struck by the fact that these two texts are more attuned to each other than even mainstream Smith scholarship seems to think. (I say this knowing that, despite relatively wide reading at this point, I still haven't scratched the surface of Smith scholarship...so it's both possible and likely that I've missed a source that takes a similar view to the one I'm about to outline!)
This term, I'm teaching a grad seminar on various conceptual (rather than historical or practical) overlaps between narrative art (especially opera) and economic theory in the 18th century. The purpose of the course is not to ask how the economics of performance or artistic production worked back then, but rather to investigate how the various ideas and preconceptions that gave rise to the birth of economics (especially to Smith's writings) also structured the way various artists were thinking about character, narrative, plot, and psychology at the time--that is to say, how the conceptual structure of early economic thinking enabled a certain kind of artistic output to arise. We've spent the first few weeks of term grappling with various musicological texts on market culture and its effect on the works of Haydn, Mozart, and Beethoven especially--but starting next week, we will begin to read Smith. I opted to begin with WN rather than TMS.
My romp through WN this weekend is my second time opening this book. I read it for the first time in 2021, and now I'm rereading portions specifically with an eye to class discussions this term. Reading it the first time, I was overwhelmed by the system of thought it put across, and the encyclopedic completeness with which it communicated this system. It was also the first Smith I had read. Now as I reread it, I have the benefit of also having read TMS, his History of Astronomy, a bunch of his essays (including the excellent writings on music, the imitative arts, etc.), and some of his lectures on rhetoric.
All of this is to say, I'm approaching WN with a vastly different structure of background knowledge from what I had back in 2021. And the experience of reading even the first few chapters is indeed strikingly different from what I recall from two years ago. Here are the things that stand out to me, on the level of argument and rhetoric.
First, and most broadly--and pace all those commentators (such as Russ Roberts, whose How Adam Smith Can Change Your Life is fun, but now seems a bit misleading)--Smith does not begin WN with an appeal to selfishness. There is a famous sentence, quoted by virtually all the commentators I've read, which runs:
"It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interests. We address ourselves, not to their humanity, but to their self-love..."
Yes, it's clear that this is the ur-statement of self-interest it is often taken to be; yet I find it significant, upon re-approaching this text, that it is placed in Chapter 2 rather than Chapter 1. Chapter 1, far from promulgating (much less recommending) a view of the fundamental selfishness of people, is all about the seeming-miracle of coordination among those who work together in individual industries. Smith marvels at the productiveness that arises with the division of labor, and implies, both in this first chapter and in Chapter 3, that the mechanism which allows the general increase in prosperity, productivity, and well-being to occur is a result of mutual, imaginative sympathy as much as it might be a result of self-interest. Chapter 1 reads like proto-Hayek on the distribution of knowledge through society (and anticipates, also, the famous "I, Pencil" essay by Leonard Read. Smith portrays the most successful people as those who work together to complement each others' needs, and even in his appeal to the "limit of market power" in Chapter 3, he suggests that an awareness of other people's interests and desires is itself the factor that determines what professions each individual can pursue. In itself, this framing of the first chapter, and the fact that Chapter 2 (with the "self-interest" statement quoted above) is tucked quietly between Chapters 1 and 3, undermines the apparent distinction between the worldview encoded in TMS and that encoded in WN.
There are some other interesting quirks of rhetoric and argument I noted as I made my way through these chapters, as well. For instance, I am struck by the mode of presentation of the division of labor idea. Smith could easily have begun the book with a statement along the lines of what we read in Chapter 2; he could also have begun Chapter 1 with a clear, overarching statement of the idea he will come to by the end of the chapter. Instead, however, he begins immediately with an example. He states that it will be easier for the reader to grasp the overall concept if he begins this way--a bit inductivistic, alas, but unsurprising given the Zeitgeist--but what he actually does, right on the first page, is to make a basic point about invisibility and evidence. He states that the effects of the division of labor are greatest precisely where they cannot be observed directly: in small enterprises, he tells us, it's easy to see people working on individual components of a project, whereas in large societal enterprises the work is so widely distributed that nobody can actually see all of it happen, nor grasp the extent of division it takes to complete it. Reading this passage after having read the History of Astronomy, I'm struck by the fact that this explanation is a concrete manifestation of a point he implies w/r/t the philosophy of science, namely that the task of science is to explain the seen in terms of the unseen. He immediately appeals to, and strengthens, his reader's tolerance for arguments invoking invisible mechanisms. The effect of this is not only to lead up to the famed Invisible Hand (though I think it does that as well!), but to bolster the subsequent arguments and anecdotes concerning coordination and the extent/power of the market, which relies on a sense that an invisible network of sympathies and imaginings connects all of the individual people in society.
Even the statement concerning self-interest, in Chapter 2, is not what it seems when quoted out of context. Smith begins the chapter by distinguishing the behavior of animals from that of humans. Animals have to look cute, he says, and appeal to humans' good nature, if they want a human to pamper them. Humans, he says by contrast, are forced to think rationally about what other people want. The ensuing statement about the self-interestedness of the butcher, baker, and brewer looks on the surface like it defends a view of humanity as intrinsically selfish. But it seems to me that it rather urges people to sympathize more with those around them, for the very mechanism by which we could even imagine the desires of the baker, brewer, or butcher is precisely the sympathetic impulse taken up in TMS. Smith speaks explicitly of self-interestedness, but implicitly gives us an explanatory structure that depends entirely on sympathy, coordination, and an imaginative effort towards fellow-feeling.
Finally, I'll just note a few fun things that occurred to me while reading today. First, Smith anticipates the argument (end of Chapter 1) that it's better to be a poor person in a wealthy nation than a wealthy person in a very poor nation. He puts the point in terms of Britain vs. Africa; but of course what comes to my mind, also, is the quite uncontroversial claim that I'm better off living in middle-to-lower class America in 2023 than I would be if I could change places with even the wealthiest nobleman in 1600. (This point is underscored, also, by my current reading of Katherine Rundell's John Donne biography, which paints a grim picture indeed of many aspects of life back then.) Second, I was struck by Smith's observation that automation generally makes things better for workers--a point anticipating Milton Friedman's argument to the same effect. Friedman said in some lecture or other that the invention, say, of running water did more to alleviate the lot of the poor than of the ultra-rich, since, as he puts it, the wealthy have always had running water (carried on the backs of their slaves or servants), and that it is in fact those carrying the water who are saved from their toil by the advance of technology. For Smith, too, it is the boy who wants to play with his friends who benefits from ingeniously devising a mechanism to do his work for him. This anticipates the Suitsian Utopia laid out in The Grasshopper, in which only those who wish to work need to work, and everyone else is essentially playing games. Finally, I will just gleefully note that Smith, too, treats animals (Chapter 2) as being essentially automata, a point that slots nicely alongside my earlier, cursory musings about Descartes and ChatGPT.
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