Almost Right But Not Quite

Rev. Dr. Marilyn Sewell writes on “Economics and Religion” HERE:

“A word about the ancient god of the free market system, Adam Smith. When Smith is quoted regarding the "invisible hand" of the market, what is conveniently forgotten is his assumptions about the conditions necessary to make free markets work. Smith assumed that we would operate on a small scale and so would know the character of the people we trade with. He assumed that our financial dealings would exist in the context of our values. Instead, Smith's writing is used to justify the mad pursuit of shareholder profit, which is held to be holy and untouchable.”

Comment
Smith was not an “ancient god of the free-market system”.

He regarded primitive belief in gods as “pusillanimous superstition” (his History of Astronomy, 1744-58; published posthumously in 1795 on his direct instructions just before he died in 1790).

He did not have a theory of the “invisible hand of the market”.

The rest of the paragraph as a statement of his broad views is acceptable:

“Smith's writing is used to justify the mad pursuit of shareholder profit, which is held to be holy and untouchable.”

Modern interpretations, and not a few inventions too, of Smith’s views are almost wholly wrong. Dr Marilyn Sewell, a minister of the Christian religion, is excused. I presume she wrote the above in good faith.

Tenuous Links Do Not a Theory Make

Bill Bonner writes in Running Because I Cant Fly Blog HERE:

"Macro for Dummies"

“Later, economists of the Scottish enlightenment, notably Adam Smith and Adam Ferguson elaborated. Smith, like Harding, saw the economy ordered by the invisible hand of God. Ferguson saw markets as a ‘spontaneous order,’ which were the “result of human action, but not the execution of any human design”.

Comment
Adam Smith wrote nothing to suggest he saw the economy “ordered by the invisible hand of God”. Adam Ferguson, a former Chaplain to the famous Scottish Regiment of the Black Watch, may well have harboured such ideas, but Adam Smith didn’t reveal such beliefs, if he held them.

The meaning of the words, “result of human action, but not the execution of any human design”, does not necessarily imply that if it was not the result of “human design” it must have been designed by God; it could as well be the that their “design” was not necessary – it was not “designed” by anybody, or anything, but was the result of unintentional activities, some of which had unforeseen consequences.

Evolution of species shows that few, if any, life forms remained exactly the same from their predecessors over geological time; they change as their environments change, some became extinct, others change their forms, even dramatically from sea- to land animals, and a few changed from quadrupeds to bipeds, as the evolution of humans from Hominines show.

On Adam Smith’s alleged “invisible hand of God” theory, his religious beliefs did change from being a candidate for ordainment as a minister in the Episcopal Church of Scotland up to 1744 (at Oxford, aged 21) to a secular career as a moral philosopher.

I discuss this in my paper, “The Hidden Adam Smith in his Theology”, presented to the History of Economics Society, University of Colorado, Denver, June 2009 (available on request).

Adam Smith and Religous Beliefs

Rev. Allen M Baker, Pastor of Christ Community Presbyterian Church in West Hartford, Connecticut, writes in Banner of Truth HERE

“Which will you choose?”

“By the sweat of your face you will eat bread (Genesis 3:19)”

In 1776 Adam Smith, a Scottish economist and Deist, a good friend of David Hume the sceptic, wrote his famous book Inquiry into the Nature and Causes of the Wealth of Nations that has profoundly affected the capitalist system in our world. Smith taught that an 'invisible hand of nature' guides the law of supply and demand and that if left alone will continue the increase in the wealth of nations equitably for all people. Smith failed, however, to heed the words of Genesis 3 concerning the implications of the fall into sin — namely that man is innately selfish and greedy, given to avarice.”

Comment
“Smith taught that an 'invisible hand of nature' guides the law of supply and demand and that if left alone will continue the increase in the wealth of nations equitably for all people.”

News to me, and I am sure it would have been news to Adam Smith. He never taught or wrote anything in the same sentence or paragraph about “the law of supply and demand” (Books I and II) and the “invisible hand of nature” (Book IV) (even the phrase “of nature” on this context is invented).

“the wealth of nations equitably for all people”.

Well, he wrote a book called (short title) the “Wealth Of Nations”, but did not refer in it to “equitably”. Distribution in its modern sense was not a topic in political economy in the 18th century. He said “progress to opulence” was a good thing – employment of labourers was good in the sense that it was better than destitution and the average life-span of 25 years.

Whether Smith failed “to heed the words of Genesis 3 concerning the implications of the fall into sin” is not documented. Being brought up in a Presbyterian household – his mother was very religious – he would know his Bible, but whether he took revealed religion seriously after his early 20s is another matter. It was unlikely that he was a Deist, at least after his mother died. In 18th-century Scotland, to be thought to be an atheist was not socially possible; Deism was also condemned but by the 1770s it was less so.

See my paper: The Hidden Adam Smith in his Alleged Theology”, presented to the History of Economics Annual Conference, University of Colorado, Denver, June 2009. Available from the address at the top of Lost Legacy’s Home Page.

“man is innately selfish and greedy, given to avarice”

“Innately” means it is within man from birth. What a low opinion Rev. Allen M Baker has of mankind. Some people are “selfish and greedy, given to avarice”, but many more are not. If we all were malformed that way we would “enter an assembly of men as [we] enter a den of lions” (Adam Smith, Moral Sentiments, 1759: TMS II.ii.3.4: 86).

It’s Rev. Allen M Baker’s kind of Presbyterianism that drove most Scots from the Church once the “Holy Willies” (as Robert Burns put it) no longer were able to force everybody into conformity with its oppressive doctrines (young Thomas Aitkenhead, a theology(!) student was hanged in Edinburgh in 1697 for so-called blasphemy).

What kind of loveless people were these men?

A Wholly Innocent Adam Smith

George Hanshaw comments on an article by Mary Lyon: “What Still Ails America” on California Progress Report HERE:

“…it's fundamental ideology at the root of all America's political "smack down" events.. it's embedded with a convoluted of view of what a society should be... for all... yet, thanks to the legacy of our founding fathers.. devoted Calvinists.. there can never be social justice here in USofA.. economic equity... certainly any thing like "national health care for all" is blasphemous if you are Calvinist. The Repig party was founded on the social construct laid down by John Calvin in 17th Century and their bible is not King James, it's "wealth of nations" written by Adam Smith, a devout Calvinist that wrote a socio-economic doctrine based on keeping separate the "chosen" and the "not chosen" .. and that is a covenant that cannot be broken in their view.”

Comment
For a rant by somebody with a forest, not a chip, on his shoulder, this is pretty strong – and wrong – stuff, at least in reference to Adam Smith.

Smith was not a “devout Calvinist” at least from 1744, when he experienced a ‘secular epiphany’ and in severe stress eventually drove the childhood demons from his mind by starting his first essay he intended for publication.

This can be read under the title, “The Principles which lead an direct Philosophical Enquiries illustrated by the History of Astronomy”, which he finished some time before 1758. It was published, at his insistence, posthumously in 1795, edited first by Joseph Black and James Hutton, his literary editors. It appeared in several editions in the 19th century (example: in 1872) and is now available from Liberty Fund in “Essays on Philosophical Subjects”, edited by W. P. D. Wightman and J. C. Bryce, Indianapolis, 1982.

For an account of the alleged religiosity of Adam Smith, see my paper: “The Hidden Adam Smith in his Religiosity” (from gavin AT gmail DOT com) (presented as a paper at the History of Economics Society Annual Conference at the University of Colorado at Denver, June 2009), which discusses the background to popular (but mistaken) views about his religious affiliations and illustrates the arguments by reference to his carefully worded, and deliberately obscurantist prose, aimed at confusing religious zealots in the Calvinist Protestant Church of Scotland to avoid the persecution aimed at his friend, David Hume.

George Hanshaw, whatever his dispute with President Obama (on which I have no view, as I only comment on current political issues in the country, Scotland, where I vote), he appears to implicate Adam Smith in a role for which he was wholly innocent.

A Bit of 'Calvinist' Nonsense - Surely Not Serious?

Peter Thompson writes in Comment is Free, The Guardian, UK HERE:

Calvin, Weber and the vanishing mediator - The question: Why won't Calvin die?

“The purposeful order of the world in natural law is the religious equivalent of Adam Smith's doctrine of the invisible hand.”

Comment
Now we have: “Adam Smith's doctrine of the invisible hand”! What doctrine?
Where is it spelled out as a ‘doctrine’?

Should we take Peter Thompson seriously?

He finds a Calvinist explanation among the Chinese Communist Part leaders who ordered the Tiananmen Square massacre, and writes: “The future of British capitalism was made safe by Cromwellism and its defeat of Catholicism …”.

Perhaps there is an affinity between Thompson and the interpretation of a metaphor as a Panglossian explantion of everything resulting from all behaviours (odious as well as sublime) that result in the best of all possible worlds whatever evil has caused them. This is truly extreme neoclassical exculpation of all and any behaviours of states or businesses.

Monopolists, protectionists, slave drivers, polluters, ands their ilk are part of a Calvinist providential plan to create God's heaven on Earth! Is there no end to superstitious credulity?

Peer Review This Morning

I am presenting my paper, 'The Hidden Adam Smith in His Religiosity' (an initial response to Lisa Hill's 'The Hidden Theology in Adam Smith', 2001) to the 'Smith, Morality, and Religion' session of the 26th Annual Conference of the History of Economics Society, in Denver, Colorado.

This is a real test of my thesis that Adam Smith was not a Christian, though a regular attender with his mother of his local Kirk in Edinburgh, was not a Providentialist (though he often used its language), and was not a Deist, though he never expressed any degree of explicit atheism. He was probably agnostic, being unable to explain what was increasingly clear that the religious accounts of the 'final cause' of the world and everything in it were inadequate as an explanation.

Smith, of course, was not informed about Darwin's theory of natural selection, of Mandel's theory of inheritance, or of genetics and Watson and Crick's 'double helix'. From 1785 Smith was aware from his friendship with James Hutton, the geologist, that the age of the Earth was much older than Bishop Usher's Biblical date of 2004 years. The Earth had 'no vestiges of a beginning, no prospect of an end' said Hutton.

In the absence of a credible alternative explanation, though theology, rooted in 'pusillanimous superstition' (his History of Astronomy) was impregnable until evidence emerged, Smith wrote in a barely discernable code that hid his doubts, a not unreasonable protection against the Presbyterrean zealots then prowling across Scottish society searching for heresy, aspostacy, and signs of atheisim.

I shall report on how my colleagues receive my paper.

Promising Abstract on Adam Smith's Stance on Religion

Ross B. Emmett (James Madison College), write in First Amendment Scholarship Update HERE: in Man and Society in Adam Smith’s Natural Morality: The Impartial Spectator, the Man of System, and the Invisible Hand .

An abstract states (in part):

“One often hears the argument that Adam Smith’s Theory of Moral Sentiments provides a basis for the construction of a morality independent of a religion based on revelation. Central to this argument is Smith’s impartial spectator, whose study of human motivation through observation of the diversity of our actions shapes our capacity to both judge the motives of our present actions and inform our future ones. To the extent that one’s moral imagination attends to the impartial spectator, one’s judgment of actions will conform to a moral standard founded on human experience rather religious revelation.”

Comment
I picked out this paragraph (ignoring for this purpose some other remarks in the abstract on an ‘invisible hand’, having said plenty about The Metaphor recently) because it states something with which I completely agree.

It is absolutely right in my view that “in Adam Smith’s Theory of Moral Sentiments provides a basis for the construction of a morality independent of a religion based on revelation”.

Smith is clear that experience is the forming force of infants learning about appropriate moral behaviour – defined as those behaviours acceptable to others – and that such learning is not ‘innate’ in a God- implanted moral faculty (Francis Hutcheson).

A society of thieves and murderer refrain from stealing for or murdering each other; a society of Jews follows the Mosaic code; Mormons follow Joseph Smith’s code and Presbyterians follow their code (similarly with Muslims, Hindu's, and so on).

It is not clear if Ross agrees with this notion from his opening words: “One often hears the argument”, which usually is a prelude to disagreeing with the statement that follows.

It is also a phraseology similar to that used by Adam Smith throughout Moral Sentiments when he makes statements about religious doctrine and beliefs to the effect that he dilutes their religious undertones.

Ross’s statement that “one’s judgment of actions will conform to a moral standard founded on human experience rather religious revelation” is similar to that which I noted from my reading of Moral Sentiments for my paper: ‘The Hidden Adam Smith in his Alleged Religiosity’, available from the address at the head of this page.

'The Hidden Adam Smith in his Alleged Religiosity'

My paper: ‘The Hidden Adam Smith in his Alleged Religiosity’, to be presented at the History of Economic Thought, 10th Summer Institute, University of Richmond, Virginia (22 June) and at the Annual Conference of the History of Economics Society, University of Colorado, Denver on 27 June.

It is now available for readers of Lost Legacy (email me for a copy). I expect it will be revised after the presentations – ‘good reason must given way to better’ (Shakespeare, Julius Caesar).

I introduce biographical indicators (which many scholars have ignored) to account for Adam Smith’s strange behaviour in his Theory of Moral Sentiments (1759), in which he deliberately modified, diluted, and in some cases quite brazenly turned away from presenting his alleged theology in a truly Christian or purely Deist manner, particularly in the last 6th edition he edited in 1789/90 and published weeks before he died.

The contrary view to mine (and a few others) that Adam Smith was ‘deeply’ religious and wrote with consistent theological undercurrents, such as offered by Richard Kleer and Lisa Hill: Kleer, (Kleer, R. A. 2000. ‘The role of teleology in Adam Smith’s Wealth of Nations’, History of Economics Review, 31: 14-29; Hill, L. 2001. "The hidden theology of Adam Smith," European Journal of the History of Economic Thought, 8(1): 1-29), is fairly dominant among Smithian scholars at present.

I intend in future to respond directly to these and other authors, but in the meantime I make my case indirectly, such as through the title of my paper which indirectly responds to Lisa Hill’s article.

For a copy, email me at Lost Legacy.

En Route to Edinburgh 23 May

I am travelling back to Edinburgh Saturday, two weeks earlier than planned, for family reasons.

I shall be out of contact until I boot the PC sometime Saturday afternoon.

Today - when not assembling my luggage - I was check through my Paper, Adam Smith's Religiosity: a review of the evidence', for the History of Economics Conference in Denver, Colorado in June.

It's always a nervous time: what have I forgotten? Where are there gaps in the case, incomplete references in the end notes, and bad grammar?

The paper is already too long (42 pages) and that's after heavy editing. I only review the evidence in Moral Sentiments and Astronomy, without assessing the debate in recent literature. This material shall be covered in a second paper, which already promises to be a long one, and to which some excellent papers are available from what I have read for the first paper. Nothing I have read so far undermines by basic hypothesis from my review of the evidence.

Once my paper is uploaded to the conference website, I shall make The Paper available to Lost Legacy for those readers who may be interested.

Separation of Church and State

Lee Randall, interviews the co-author of ‘God is Back, How the Global Rise of Faith is Changing the World’, by John Micklethwait (editor of The Economist) and Adrian Wooldridge, Allen Lane (Penguin), in The Scotsman, 19 May, HERE:

“Keeping the faith”

“BACK in 1843, James Wilson, a hat maker from Hawick, founded The Economist, partly to serve as a mouthpiece for his campaign on behalf of free trade. As the magazine's website explains, he shared a special affinity with the economic philosophies of another notable Scot, Adam Smith. I've cornered [John-Micklethwait] to discuss his latest book [God is Back], which explores the interplay between God and politics.

God is Back [is] a thought-provoking exploration of the global rise of faith is changing the world ... the book's chief argument is that in order to understand the politics of the 21st century, you cannot afford to ignore God whether you're a believer or not.

Micklethwait is Catholic, his co-author an atheist:

"Our book is the latest stage of an argument that began in Edinburgh, between David Hume and Adam Smith. Hume favoured an established clergy that had been 'bribed into indolence', whereas Smith was keen to open up the religious marketplace to competition. He argued that you wouldn't get successful religion without competition, because established clergy are always bound to try less hard than people who have to battle for every soul."

The authors found that, at heart, man is fundamentally theocentric – given a chance to believe in God, we will do so. So although some Enlightenment thinkers saw religion as oppressive and unscientific – and prevailing wisdom, especially in Europe, held that as the world became more modern it would become more secular – Micklethwait discovered that instead, with modernity comes pluralism.

"You wind up with the ability to choose your faith, which is why we focus so much on America in the book. One in every four Americans changes faith – that's an amazing statistic. Pluralism also gives you the possibility to not be religious at all. What it does is forces you to make a choice."

The American and French Revolutions are key events, he argues. "The French took the line that the church was bound up with the state and so you couldn't have modern life without overthrowing it. That contrasts with the end of the American Revolution, when nobody felt it was particularly odd having religion around. Americans, in the main, have assumed that the two things can thrive together."

Indeed, America's Constitution, along with the writings of Adam Smith, form the key texts required to understand the "competitive mechanism behind religion's revival", writes Micklethwait. "The First Amendment – 'that Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof' – was actually a compromise between dissenters (who wanted to keep the state away from religion) and more anticlerical sorts... (who wanted the church out of politics). Yet it became the great engine of American religiosity, creating a new sort of country where membership in a church was a purely voluntary activity."

Comment
To fully follow the argument you should use the link (my editing necessarily is severe).

Adam Smith on religion is a controversial subject, worsened by it being almost ignored, despite a long section on the organisation of religious institutions in Wealth Of Nations (Book V), alluded to in Micklethwait’s statements. He suggests that there was an ‘argument’ between Hume and Smith, but I would consider it more the presentation of two alternatives.

Hume, the public sceptic about the revealed religion, and all that went with it, of Christianity, favouring an established church because it could do less harm to free thinking than allowing overly enthusiastic little sects to proliferate and cause trouble if they succeeded, and Smith favouring the weakening of state-enforced beliefs by encouraging a ‘thousand sects’ to proliferate, no one of them large enough to disturb a community’s tranquillity.

It was really an empirical question for both of them; Scotland had a quasi-established church in the many Presbyteries that covered the land, of which the zealots in many of them ruthlessly hunted down whatever they considered to be ‘heresy’ (England, of course, had the Church of England in England and the Episcopalians in Scotland); on the fringes of both countries, there were little sects (Quakers among the most prominent), which conformed to Smith’s model to a small extent – they held sway over small groups of people, but did not overly dominate non-members – they were ostracised by the larger established churches and mainly ‘kept their heads down’.

I am not clear what Mickelthwait means by ‘The French took the line that the church was bound up with the state and so you couldn't have modern life without overthrowing it.’ Revolutions can be messy, but the French Catholic church survived, and survives, as an institution (the church in the French village I live in for part of the year was built in the 11th century).

What is clear that the separation of Church and State in France is absolute and not challenged as it is in the USA. In a recent dispute over the wearing of Muslim headscarves by some young girls to School, the President of France said ‘non’ firmly and quoted the separation of Church and State and its operation , for many years in matters with the Catholic Church. The revolution overthrew the State of Louis XVI, disconnecting the roles of Cardinals, but at grass roots the Church continued, until recently – there are not enough priests to hold mass in every local church.

The problem of state and church in revolutionary America was not a little influenced by the question: which religion could be established given the already fractionated churches in existence. The last thing the new state was religious strife in attempting to force on church on the rest. Hence, Smith’s idea of competing churches struck a chord.

Note: My paper, ‘Adam Smith’s Religiosity: a review of the evidence’ is now completed and will be presented to the History of Economic Society annual conference in Denver, Colorado, in June.

Adam Smith and Religious Beliefs

Stephen L. Bloom, a Christian lawyer serving clients throughout Pennsylvania, writes in Good News Daily (‘hope after the headlines’)
HERE:

“Good News on the Law: More Laws or More Freedom to Cure the Great O-pression?”

“But to dismiss or underestimate Adam Smith at such a time as this would be a dangerous mistake. Because Smith – although he was a Deist, rather than an orthodox Christian – clearly understood exactly the nature of our menace: The fallen, sinful, self-centered, and hopelessly self-interested human heart; “the imperfect propriety,” as he called it, of our own conduct. And the general economic system Smith articulated in the illumination of that understanding has been the only one ever devised, before or since, to effectively and consistently harness the power of our horrible human greed and transform it for our common good.”

Comment
Adam Smith was not a Christian, ‘orthodox’ or otherwise. I am not sure what Stephen implies by the words: ‘although he was a Deist, rather than an orthodox Christian – clearly understood exactly the nature of our menace’.

Is this a suggestion that only ‘orthodox Christians’ and ‘Deists’ understand the ‘The fallen, sinful, self-centered, and hopelessly self-interested human heart; “the imperfect propriety”?

It is this kind of moral arrogance that gives adherents of religion – any religion – a ridiculous aura. Adam Smith was a moral philosopher and perfectly capable of understanding the culpability of human beings in amoral and immoral behaviours, as did philosophers long before Christianity was known about. They, and he, wrote extensively about the whole range of human behaviours.

As for Deism, proclaiming such matters, especially contrary views to the prevailing orthodoxies of 18th-century society, was not just a matter of exercising an imaginary freedom of speech – an unknown freedom in Scottish society under any of the denominations of Christianity, none of which were any more tolerant than any other when they achieved political power.

The last man (a boy actually, a student) to be hanged for blasphemy, in his case on trumped-up and spurious charges, Thomas Aitkenhead, was hanged in Edinburgh in 1697, and the last witch, a woman more senile than evil, was burned to death in 1727. On an almost weekly basis, somewhere across Scotland, young girls were paraded before the Kirk to be harangued and humiliated by sanctimonious ministers, breathing fire and indignation, for sins of reputation or imputation over sexual activities, not a few of which were caused by members of their incestuous families.

David Hume was accused by Agnes Galbraith of fathering her child out of wedlock in the Chirnside Kirk, 25 June, 1734. She appeared in the sackcloth and was committed to the pillory. (See Mossner, E. C. The Life of David Hume, Oxford, 1980).

Of Course, Hume was widely believed to have been an atheist, a ‘crime’ for which those (very few) who declared to be so, were excluded from ‘polite’ society. He was refused chairs by both Edinbrugh and Glasgow Universities on the interventions of Kirk ministers. Hence, most sensible people took pains never to be suspected of the lack of belief that dare not be named.

Among them was Adam Smith. He had many profound family reasons not to appear as anything other than a Christian (his mother was deeply religious and he would never do anything to upset her). As a professor, he had signed the Calvinist Confession of Faith before the Glasgow presbytery – no signature, no professorship – and he had to open his daily lectures with a prayer, which he tried unsuccessfully to be excused from. He delivered his prayers more in the manner of Natural rather than Revealed religion, for which some still complained (Natural Religion was part of the Moral Philosophy syllabus).

Smith wrote Moral Sentiments with a scattering of Christian sentiments throughout, though they were often qualified by innocuous words and phrases that have passed unnoticed so far (I am documenting these at the moment for my paper to be presented at the Annual Conference of the History of Economics Society in Colorado this June). If he hadn’t done so, his book would likely not have been published; as it was some opinionated divines found grounds upon which to quarrel, some, like Bishop Magee, blamed Smith for his association with the ‘atheist David Hume’. (Hume never admitted to being an atheist)

A further question emerges: to what extent was Smith even a ‘Deist’, or had he abandoned all faith in religion? That remains to be seen – my paper addresses this latter question in the (cautious and tentative) affirmative.

For Stephen, the ‘Christian Lawyer’, who layers his proposals for the current financial problems with a dose of ‘freedom’ may feel obliged to let his case rest solely on his own Christian theology when it becomes clear that Adam Smith’s moral philosophy stands alone without association with any religion.

Given Stephen's ‘misunderstanding’ of Smith’s political economy as manifested in the rest of his article, I doubt whether he will do other than continue to hide under the misapprehensions he has about Smith’s supposed views on religion.

Adam Smith and Religion

A reader, ‘RCAR’ comments on a post by Jennifer Rubin, ‘False Choices, Indeed’ on Commentary Magazine.com HERE:

“Great point, but we already tried that. Even Alan Greenspan himself has now admitted that we need to nationalize the banks and that free markets are not self regulating. It took him a while to figure that out. Also, remember that Rand was the hardest of hard core atheists, not a position consistent with the “invisible hand” of Adam Smith”.

Comment
I shall not bother correcting the myth of Adam Smith and the invisible hand – there are plenty of posts to that effect on Lost Legacy.

My comments are directed at the alleged religiosity of Smith’s use of The Metaphor. There are many differences between Ayn Rand and Adam Smith (she was an ideologue; Smith wasn’t). That she was an atheist but that he allegedly was not is more problematical.

We are not comparing the fierce independence of mind of Ayn Rand, born in Russia, but moved to the USA, a country denominated on the right of free speech, and therefore able to enjoy the brave luxury of saying exactly what she liked (and did so), whereas Adam Smith lived in Scotland, a country dominated by religious bigots and zealots, who threw their considerable weight around at whoever expressed any views deviating an iota from the authoritarian creeds of the Protestant Church, or, down in the small details, against those who appeared to live lives of less than total (sexual) virtue (if female) or, both sexes, who didn’t attend Church services on Sundays.

How Ayn Rand, a ‘free-spirit’ would have gotten on in the company of these gentlemen – the Taliban of the age – does not bear thinking about. To teach in a university, the faculty had to sign the Westminster Confession of Faith, lead prayers at the start of a class, and lecture in Latin. Under no circumstances could they offer dissent from religion. These onerous conditions would not have bothered Ayn Rand, should she have been alive then – being female she would not have gone to university, let along taught in one.

Adam Smith signed the Calvinist Confession of Faith, asked permission to abandon the saying of prayers (was refused by Glasgow University), and otherwise he ‘got along by going along’.

The first edition of his book in 1759, ‘Moral Sentiments’ was written so as to pass the religious test (Hume teased him that three Bishops had visited his publisher to buy copies and wondered what ‘true philosophers’ would think of its author being read by ‘these retainers to superstition’, Letter, 12 April 1759).

Yet, Smith published six edition in his lifetime, the last showing quite significant changes which diluted the religious language he felt obliged to use in the 1st edition. Smith died a few weeks after the 6th edition was published. It was clearly a symbolic statement of his rejection of revealed religion; he knew he was dying and if he had believed in an ‘after life’ it was not the best time for him to cause offence to god.

My current research into the alleged religiosity of Adam Smith has revealed a far different perspective on him. He certainly was not a Christian and nor, in my view, was it likely that he was even a Deist by the time he died. I am preparing a paper on these issues at present and will post it on Lost Legacy, as well, I hope, present it to a conference of Historians of Economic Thought later this year.

A Classic Spoiled by Mysticism

‘Chief’ posted (18 January) on Tragedy of the Commons (HERE):

the text of the near brilliant, but slightly flawed, short outline of the powers of markets, identified by Leonard Read’s essay “I, Pencil”, as a process of disconnected coordination, without planning, central directions, or anything other than human beings acting, reacting, and pro-acting, to opportunities signalled by prices, rumours, and probabilities.

Chief, however, tops his post with a short paragraph by Milton Friedman, complete with his mystical allusions to the metaphor of an ‘invisible hand’, which detracts from the ordinariness of human endeavour, as if markets contain pure and innocent spirits, sometimes attributed to the will of a living Deity.

Friedman’s introduction spoils the softer power of Read’s ‘I, Pencil’, leaving it trapped in what Adam Smith had called ‘Surprise and Wonder’ but well short of ‘Admiration’, which comes from knowledge, the final step of human understanding (See Adam Smith, posthumous, ‘The Principles which lead and direct Philosophical Enquiries; illustrated by the History of Astronomy, [1744-58: 1795], in Essays on Philosophical Subjects, pp 5-129; 1980, Liberty Press).

‘Savages’ claimed their lives were ruled by invisible beings in everything they could not understand. Philosophers, wrote Smith, uncover the ‘connecting’ and ‘invisible links’ of events and, as a result, science marches on.

Milton Friedman and Leonard E. Read, both of whom made outstanding contributions in their writings, in this matter, however, both of them unintentionally led their readers away from understanding towards mysticism, only a step of two away from what Smith called ‘pusillanimous paganism’.

They became responsible in part for an unscientific sediment in political economy which wraps the ordinariness of human markets that are perfectly understandable within economics and without invisible body parts.

Markets operate without the mumbo jumbo of divine purpose (an unholy notion, I would have thought, linking the honest man from Galilee with the global market economy), and without the widespread populist belief in, not the simple literary metaphor used by Adam Smith for another purpose (see Lost Legacy passim), and without actual ‘invisible hands’, as if they really exist in the world in general and in markets in particular.

You can (and should) read Leonard Read’s ‘I, Pencil’ HERE:

Leonard E. Read (1898-1983) founded FEE in 1946 and served as its president until his death.

"I, Pencil," his most famous essay, was first published in the December 1958 issue of The Freeman. Although a few of the manufacturing details and place names have changed over the past forty years, the principles are unchanged.

'I, Pencil' reported that his ‘official name is "Mongol 482." My many ingredients are assembled, fabricated, and finished by Eberhard Faber Pencil Company’

A Surprise Invitation

Unexpected invitations can be exhilarating, as well as risky. Mine yesterday afternoon was both.

The US John Templeton Foundation has sponsored a 2-day meeting in Edinburgh of a small group of senior scholars interested and well qualified in “Adam Smith as Theologian”, some from the UK nnd the rest of Europe, many from the USA and Canada, and a few from Australia.

Judging from the agenda, this is an intensive, high-level seminar. The titles show the range and depth of the events:

Theological Readings of Adam Smith;
The Influence of Religious Thinking on the Smithian Revolution;
Divine Action, Providence and Smith’s Invisible Hand;
Theology and Natural Law Ethics;
A Divine Economy: assessing Adam Smith’s Theology;
Adam Smith’s Theodicy;
Man and Society in Adam Smith’s Natural Morality: the impartial spectator, the man in the system, and the invisible hand;
The Contemporary Developments of Adam Smith today;
A Visible Hand: modern lessons from Smith’s Theory of Moral Sentiments.

Yesterday afternoon, Paul Oslington, Professor of Economics at Australian Catholic University (Sydney), called me from the conference (held at the Royal Society of Edinburgh, in George Street – of which Adam Smith as a founder member in 1783), to invite me to a dinner that evening and to give a short biographical talk on Adam Smith in Edinburgh. Naturally I accepted.

Those readers following my post and the comments on Monday will be aware of my current research topic on the extent to which, if at all, that Adam Smith was a Deist.

Until I arrived at the dinner at Fisher’s, Thistle Street, one of Edinburgh finest restaurants (at least to my palate), I was unaware of the serious nature of the conference to which Paul was headed when I conducted him on the ‘Adam Smith Tour’ under the tender attentions of Edinburgh at its coldest, wettest, and windiest.

The John Templeton Foundation is a serious contributor to the dissemination of knowledge.

However, I was not there to discuss religion and Adam Smith, and I steered well clear of the topic, as propriety dictates (see Moral Sentiments - don't argue with your hosts!). I listened to diners discussing their academic work and observed their serious demeanours.

My short talk on Adam Smith’s time in Edinburgh was received reasonably well and I returned home feeling I had enjoyed a lovely evening with several strangers and the one or two whom I knew from History of Economic Thought Meetings, or from their writings on Adam Smith, feeling that with all of whom I could be friends.

The Republic of Letters is sometimes an illusive reality which is made real in such meetings.

Belief, Whether True or False, Can Have Beneficial Effects

Among the many interesting papers presented at the Balliol Commemoration conference last week was one by Professor Ryan Hanley (Marquette University), which was beautifully delivered and a model of how to present to a seminar.

I shall pick up on one small aspect of it because it also arises in my current reading of Moral Sentiments with a view to my deciding to what extent, if any, was Adam Smith religious?

Ryan quoted from Moral Sentiments and I use the following as representative of his selection:

“For it well deserves to be taken notice of, that we are so far from imagining that injustice ought to be punished in this life, merely on account of the order of society, which cannot otherwise be maintained, that Nature teaches us to hope, and religion, we suppose, authorises us to expect, that it will be punished, even in a life to come. Our sense of its ill desert pursues it, if I may say so, even beyond the grave, though the example of its punishment there cannot serve to deter the rest of mankind, who see it not, who know it not, from being guilty of the like practices here. The justice of God, however, we think, still requires, that he should hereafter avenge the injuries of the widow and the fatherless, who are here so often insulted with impunity. In every religion, and in every superstition that the world has ever beheld, accordingly, there has been a Tartarus as well as an Elysium; a place provided for the punishment of the wicked, as well as one for the reward of the just.” [TMS II.ii.3.12: p 91]

and

“But upon the tolerable observance of these duties, depends the very existence of human society, which would crumble into nothing if mankind were not generally impressed with a reverence for those important rules of conduct.
This reverence is still further enhanced by an opinion which is first impressed by nature, and afterwards confirmed by reasoning and philosophy, that those important rules of morality are the commands and laws of the Deity, who will finally reward the obedient, and punish the transgressors of their duty.” [TMS III.5.2-3: p 163]

Comment
These are examples of Smith’s very careful use of language, which seems to me to be not saying what is normally attributed to him. Theologians draw upon such passages to assert that Adam Smith was religious and on a casual reading that may well be a view that has merit.

However, these, and many other statements on similar themes, are perfectly compatible with Smith not believing the intended message. He was writing while a professor at a protestant university in a decided atmosphere of compliance with revealed religion and for which there were severe consequences should he not do so. Even his tutor, Francis Hutcheson, ran into some trouble with the local zealots, who detected apostasy in his teachings while Smith was a young student and against which there were incidents of student ‘disturbance’ over the ridiculous charges (the Church court found Hutcheson innocent].

The wording of: “Nature teaches us to hope, and religion, we suppose, authorises us to expect, that it will be punished, even in a life to come”, is not definitive; ‘hope’, ‘to expect’, ‘even in a life to come’, are not wringing endorsements at all.

Nor is: “In every religion, and in every superstition that the world has ever beheld”. Linking ‘every religion’ with ‘every superstition’ is instructive; in his History of Astronomy, Smith refers to ‘pusillanimous superstition’, and by equating such language with ‘every religion’, Smith slips in a subtle signal.

Christianity, of course, adopted the Greek pagan religious, after-life places of “Tartarus as well as an Elysium” (Hell and Heaven), as well as their becoming the lucrative (for the clergy) doctrine of purgatory.

In the second quotation we note “further enhanced by an opinion” (not a fact”) “if mankind were not generally impressed with a reverence” to which deficiency they are “first impressed by nature, and afterwards confirmed by reasoning and philosophy”, that they “are the commands and laws of the Deity” to be finally confirmed, not on Earth, but in the ‘after life’, for which religion is the sole source for evidence that it exists (it fails the Humean experience test).

The point should be made that the belief in the after-life, in so far as it encourages suitable behaviour in this life, may well be of great benefit to society (on preventing it ‘crumbling to atoms’), but it is the belief that it is so, not necessarily that it is true that it is so. The one can be quite separate from the other; punishment in an ‘after lie’ does not need to be true for its beneficial effects from such a belief to be realized in this life.

I believe that Adam Smith was saying just that and his many other statements on these matters in Moral Sentiments suggest that my belief has credibility.

Attending a Conference - Without Internet Connections

I am leaving for Oxford University tomorrow to attend as a listening participant the following conference:

“The Philosophy of Adam Smith”

A conference to commemorate the 250th anniversary of The Theory of Moral Sentiments
January 6-8, 2009 - Balliol College, Oxford University.

Organised by the International Adam Smith Society and The Adam Smith Review.

“Although Adam Smith is better known now for his economics, in his own time it was his first book, The Theory of Moral Sentiments (1759), which established his reputation. Just as scholarly work on Smith has challenged the free market appropriation of Smith’s Wealth of Nations, so it has also come to appreciate the importance of Smith’s moral philosophy for his overall intellectual project. This conference, to be held at the college Smith himself attended from 1740-46, and at the beginning of the year marking the 250th anniversary of the publication of The Theory of Moral Sentiments, will provide an opportunity to re-evaluate the significance of Smith’s moral philosophy and moral psychology, the relationship between them and his other writings on economics, politics, jurisprudence, history, and rhetoric and belles lettres, and the relevance of his thought to current research in these areas."

***
From the delegates’ list it is a gathering of some of the leading Smithian scholars from around the World and the papers to be presented are a mouthwatering sample of the very best of current scholarship.

That it is to be held in Balliol College, Oxford, where Adam Smith spent six years (1740-46) earning his MA degree, is a special treat in itself. He went to Oxford to study to qualify for ordination into the Church of England and for a career as a minister in the Episcopalian Church of Scotland (the C of E affiliate church, north of the Border). He left Oxford before completing his course and resigned his Snell Exhibition (worth £40 a year) in 1749, and never returned to Oxford University.

It was while Adam Smith was at Oxford that, it is believed, he began to write sometime around 1744 what became is essay, ‘The Principles which lead and direct Philosophical Enquiries as illustrated by the History of Astronomy’, first published posthumously in 1795 by his Literary Executors, Joseph Black and James Hutton.

In my ‘Adam Smith: a moral philosopher and his political economy’, Palgrave Macmillan, 2008, I regard this first essay as a most important statement of Smith’s approach to his work, coinciding, while he was writing it, with his decision to resign from his preparation for a career in the Church and to become a moral philosopher.

I also suggest – which I am currently researching in detail – that this essay marks his first statement of his abandonment of the Church version of Christianity, followed up in Moral Sentiments with what amounts to a non-religious stance that was well short of Deism.

Unfortunately, my current laptop no longer connects to the Internet, so, unless I can make alternative arrangements in Oxford, I shall be unable to post on Lost Legacy (you may believe I shall every effort to find an Internet Café or such like). I shall be able to read messages and emails on my Apple i-phone.

I shall compile reports of the Conference for Lost Legacy, but I may be unable to post them until my return to Edinburgh on Friday.

Thank you for your patience at any absence enforced by failure on the technical side.

Adam Smith on Competition Among Religous Sects

Catherine Rampell writes in the New York Times, 26 December, on “Hanukkah Economics” HERE:

“What Would Adam Smith Say About Today’s Hanukkah?

A Slate piece, by the Columbia Business School professor Ray Fisman, talks about Adam Smith’s argument for why religious competition was a good thing, and whether it stands up to the fact that “a minor holiday largely unrelated to Judaism’s core values has earned outsize importance, primarily so parents can bribe their kids into keeping the faith.”

Comment
Hanukkah is a Jewish religious festival, which “commemorates the rededication of the Holy Temple in Jerusalem”, on the ‘25th day of Kislev’ and is celebrated for eight days in November or December. It pre-dates the Christian ‘Christmas' by 200 years, though the coincidence of dates may be fortuitous.

However, Ray Fisman, may (I have not read his article) be misreading Adam Smith on religious competition. This had little to do with economic competition; it related to the power of an Established Church.

In England the Church of England was (and remains) the official church, headed by the sovereign (who, by law, still enforced, cannot marry a Roman Catholic; I take it marrying a Jew or a Moslem is out of the question).

In Scotland it was, and is, the Church of Scotland, detached from government and in many senses superior to the weak governments at the time. Scotland ‘lost’ its parliament when the two countries formed a parliament of the United Kingdom – the crowns had unified a century earlier when James VI of Scotland became James I of the United Kingdom (North American friends and antipodeans, please note that there is no such title extant as the ‘Queen of England’).

Smith’s concern was with ecclesiastical establishments that were aligned with political interests. In becoming Established, such churches became embroiled in ‘violent religious controversy’ and ‘violent faction’ (Wealth Of Nations, V.i.g: pp 788-814; Canaan, 1937. pp 740-66) Before my Islamic friends smirk at the Christian capacity for ‘violent controversy’ over holy doctrines, please contemplate the murderous contentions between today’s Sunni and Shia adherents.

Zeal and religious enthusiasm go together, and Adam Smith and others had personal, almost daily, experience of zealot-led disturbances in Scottish life in the 18th century, especially on Sundays when named individuals were treated abominably for whatever ‘sins’, real and imaginary, had come to the attention of zealot-minded busy bodies.

The last person hanged for blasphemy was a student, Thomas Aikenead, on 8 January 1697; the last witch burned to death was Janet Horne in 1727 (when Smith was just 4 years old); ‘the never to be forgotten’ Francis Hutcheson, a minister of the Ulster Church, experienced the ire of ignorant zealots in a petty incident when they accused him of apostasy (Smith was his student at Glasgow University, 1737-40).

Smith favoured that ‘every man [be allowed] to chuse his own priest and his own religion as he thought proper’ because this would dilute religious ‘zeal’ and make it ‘altogether innocent when society is divided into two or three hundred, or perhaps into as many thousand small sects, of which no one could be considerable enough to disturb the publick tranquillity” (p 793; p 745).

This was his main concern; to allow freedom of religious belief as an antidote to the excesses of the Established Churches when interfering in the daily lives of people.

To this wish, he added two more: education in science, because science was the ‘great antidote to the poison of enthusiasm and superstition’, and ‘the frequency and gaiety of public diversions”:

“The state, by encouraging, that is by giving entire liberty to all those who for their own interest would attempt without scandal or indecency, to amuse and divert the people by painting, poetry, music, dancing; by all sorts of dramatic representations and exhibitions, would easily dissipate, in the greater part of them, that melancholy and gloomy humour which is almost always the nurse of popular superstition and enthusiasm. Public diversions have always been the objects of dread and hatred to all the fanatical promoters of those popular frenzies. The gaiety and good humour which those diversions inspire were altogether inconsistent with that temper of mind which was fittest for their purpose, or which they could best work upon. Dramatic representations, besides, frequently exposing their artifices to public ridicule, and sometimes even to public execration, were upon that account, more than all other diversions, the objects of their peculiar abhorrence.” (WN V.i.g: p 796; Canaan, 1937 ed. p 748)

I recommend readers to cast their minds over what is probably the most neglected chapter in Wealth Of Nations and which deals with what he considered to be an obstacle to the spread of opulence among all the members of a society, and, as it stood in Britain, a cause of much needless unhappiness (how many economists writing on measuring ‘happiness’ today have read it, I wonder?).

Catherine Rampell would certainly benefit from understanding why Adam Smith advocated widespread religious tolerance, manifested in a society allowing all forms of religion to compete for the attention of potential adherents, and for open competition among the numerous sects was one element of his policy of avoiding a dominant religion emerging to gain political power and influence.

That was, after all, the brilliant insight of the Founding Fathers in their legislative separation of religion from the State in the US constitution.

Intellectual Life Does not Influence Everyday Life That Much

Canadian Content Blog carries an article, “The evangelical roots of economics” from “Let there be markets: The evangelical roots of economics”, extracted from Gordon Bigelow’s piece in Harper's Magazine (HERE):

“When evangelical Christianity first grew into a powerful movement, between 1800 and 1850, studies of wealth and trade were called “political economy.” The two books at the center of this new learning were Adam Smith’s Wealth of Nations (1776) and David Ricardo’s Principles of Political Economy and Taxation (1817):

"This was the period of the industrial transformation of Britain, a time of rapid urban growth and rapidly fluctuating markets. These books offered explanations of how societies become wealthy and how they can stay that way. They made the accelerated pace of urban life and industrial workshops seem understandable as part of a program that modern history would follow. But by the 1820s, a number of Smith’s and Ricardo’s ideas had become difficult for the growing merchant and investor class to accept.

For Smith, the pursuit of wealth was a grotesque personal error, a misunderstanding of human happiness. In his first book, The Theory of Moral Sentiments (1759), Smith argued that the acquisition of money brings no good in itself; it seems attractive only because of the mistaken belief that fine possessions draw the admiration of others.

Smith welcomed acquisitiveness only because he concluded—in a proposition carried through to Wealth of Nations—that this pursuit of “baubles and trinkets” would ultimately enrich society as a whole. As the wealthy bought gold pickle forks and paid servants to herd their pet peacocks, the servants and the goldsmiths would benefit. It was on this dubious foundation that Smith built his case for freedom of trade.

By the 1820s and ’30s, this foundation had become increasingly troubling to free-trade advocates, who sought, in their study of political economy, not just an explanation of rapid change but a moral justification for their own wealth and for the outlandish sufferings endured by the new industrial poor. Smith, who scoffed at personal riches, offered no comfort here. In The Wealth of Nations, the shrewd man of business was not a hero but a hapless bystander.

Comment
This type of article which links books written in 1759 (Moral Sentiments) and 1776 (Wealth Of Nations) by Adam Smith with another by David Ricardo in 1817 (Principles of Political Economy and Taxation) with the collective views of a “growing merchant and investor class to accept”, only become acceptable by distance of the reader from the relevant events.

While many ‘merchants and investors’ were educated at the time (and many others weren’t) it is a bit of a stretch to accepts that they were familiar with Smith’s and Ricardo’s texts (the last author is especially suspicious of people such as busy ‘merchants and investors’ being familiar with his work – a most obscure text if ever there was one!).

I suspect that the influence of intellectuals is much less than commentators might think, perhaps in the belief that because we read these works still, it must have been the case that they were widely read by entrepreneurs too. It is more likely that if none of the above books were written, that events in markets, development, innovation and growth would have continued in much the way that they did anyway. There is an intellectual life and an everyday life; the latter may influence the former but the former is less likely to influence the latter.

The chattering classes who ‘translate’ notable texts, and who make notable text more familiar to the each other and to those who listen to them, also filter ideas in the process of their popularising versions of them, quite often at the expense of vulgarising their authors’ ideas, where they don’t suppress things they choose to ignore. Hence, Adam Smith’s holistic ideas were filtered down to a few words, such as ‘laissez-faire’ (which happened not to be his ideas at all – he never mentioned these words once), or ‘night watchman state' (spoken not by Smith but by the socialist firebrand, Ferdinand Lassalle, who actually mocked the idea of a smaller, leaner bourgeois state).

A century later, in fact, a further filtering took place around the metaphor of ‘an invisible hand’. In all these cases, the extent of the knowledge of many people who have heard the name ‘Adam Smith’, but never read his books, is limited to these three erroneous propositions alleged to be his, ‘laissez-faire', ‘night-watchman state', and ‘invisible hand’.

The idea that the “growing merchant and investor class” gave a moment’s thought to either Adam Smith or David Ricardo, frankly, is quite ludicrous. That the educated classes of religious orthodoxy and evangelical enthusiasm concocted a ‘plausible’ narrative as described by Gordon Bigelow is perfectly possible. That it had anything to do with Adam Smith’s ideas is quite irrelevant, as anybody turning the pages of either of his books would grasp in no time.

Incidentally, per capita incomes rose throughout the 19th century, despite the dreadful conditions of those urban labourers at the very bottom of the social heap and they continued to do so throughout the 20th century. If the urban poor were near destitute, the lot of the rural poor was even worse, as it is today for the same division of populations in the poorer countries of the world.

An Atheist Quotes Adam Smith for Moral Authority

David Ian Millar (a guid Scot’s name) writes a column in San Francisco Chronicle, ‘Finding My Religion’ and this week’s offering is HERE:

“Mac Geek Mike Lee is a committed atheist living a deeply spiritual life”

[David interviews a self-proclaimed atheist, who used to be an evangelical Christian]

David: “You talk and write a lot about radical altruistic capitalism -- what is that, exactly?

Mike: In "Wealth of Nations," Adam Smith explained that people did not have to exploit others to be wealthy. Smith showed that everyone could be wealthy if they each went about their business to their own selfish ends, but within reason, and with an eye toward the common good. The caveat is important, because without it, capitalism fails at its primary goal, which is the betterment of all mankind.

"I call the sustainable form of capitalism that creates profits for all "altruistic capitalism," and the form that creates profits for some to the detriment of others I refer to as "exploitative capitalism." Most businesses ignore the distinction and pursue whichever is most convenient. Our radicalism is in our complete rejection of making money to the detriment of others, to the point where we might be a little too nice. But better we be too nice, rather than just nice enough.

David: It's interesting that you have a focus on social causes in your business, although you're an atheist. Some people feel like the world would run amuck if we didn't believe in God, that morality comes from or is at least enforced by people's spiritual beliefs.

Mike: Adam Smith tackled this exact question in his first book, "Moral Sentiments." What he eventually comes to is that humans, unique among animals, have the power to imagine themselves in another's situation. And Richard Dawkins proves that this aberration, this "empathy," is a net win for natural selection. Empathy leads to altruism, which is the impulse to help others. From this springs a central tenet that is the basis for all morality: Treat people like you want to be treated. Rather than being told (what to do) through some clumsy book addled with arcane rules, my ethics are woven into my very genes.”

Comment
[By the way I am not picking on religious subjects at all. This came up in my Giigle alerts service from for today's references to Adam Smith]

Of course, Mike Lee elides ‘self-interest’, which Adam Smith spoke of, into ‘selfishness’, which Smith always opposed, but skip that slip and focus on the message: all are better off from exchange relations.

We should also remember that the full range of human behaviours is available to every person engaging in exchange behaviours and to the full range of alternative actions available to those who want something they have not got. There are many other actions people can take as an alternative to bargaining, such as plunder, fraud, and violence at one extreme and ‘toss-a-coin”, mediate, instruct, and give in, at the other.

Mike Lee expresses his personal moral stance and does so without spiritual beliefs in invisible beings. This supports my contention yesterday that religious-minded people do not have a monopoly on morals.

Interestingly, Mike calls up Adam Smith in support of his atheistic moral stance. I applaud his choice of his authority for his business ethics. Of the moral issues, readers may make their own minds up; you can follows the link to read the rest of the interview.

Adam Smith and the 'Hand of God'

Ralph Martire, executive director of the Center for Tax and Budget Accountability, a bipartisan fiscal policy think tank, writing in the State Journal-Register (Illinois) HERE (10 December), brings a divine hand of god into his argument, not by direct quotation from Adam Smith but via Sir Isaac Newton (1643-1727):

“Growth in wages a key to economic recovery”

“The free market wage failure in America is a failure under classic, capitalist theory. And by classic, I mean original, as in Adam Smith.

Modern proponents of free markets at all costs have a tendency to forget the strong moral — in fact religious — underpinnings of capitalism. “The Wealth of Nations,” Smith’s seminal work, was published back in 1776, and was greatly influenced by the thinking of Sir Isaac Newton, “Mr. Natural Law” himself. As Newton believed the properties of natural science were put into place by the Almighty, Smith saw the hand of God behind economic principles.

Which is why Smith could base most of his theory on people acting out of self-interest, while simultaneously believing there exists a fundamental aspect of every person that causes him to be concerned about “the fortune of others and render their happiness necessary to him, though he derives nothing from it.”

Extending that divinely imbued concern for others to the economic principle of wages wasn’t a stretch for Smith. Recognizing that business owners have the advantage over workers when setting wages, he nonetheless posited that wages wouldn’t fall below an amount sufficient to cover living expenses. Smith maintained that even for low-end workers, a husband and wife will always “earn something more than what is precisely necessary for their own maintenance.”

That divinely inspired sense of concern for others was just as important for capitalism to work as envisioned by Adam Smith, as was the motivation of individuals to act in their own self-interest. Unfortunately, the modern school of capitalist thought has not only elevated unabated self-interest to the top of the heap — it has completely eliminated concern for others from the equation, with predictable consequences….

… That means the federal government should borrow a page from Adam Smith, and implement policies that give businesses the incentive to increase the wages paid to workers, so they finally earn “something more than what is precisely necessary for their own maintenance.”

Comment
After admitting that there is nothing in his article that is by direct quotation from Adam Smith to infer that “the divine hand of God” was “behind economic principles”, Ralph Martire, a tax consultant (step up from Matthew, a mere the tax collector, and a disciple of Jesus in the New Testament) asserts by tenuous association of Adam Smith with Isaac Newton.

The inspiration for Adam Smith's ideas about Natural Law (often confused with laissesz-faire) was not Newton (whom he admired) but Samuel Pufendorf, whose philsophical ideas were part of the Scottish teaching of moral philosophy via Carmichael and Hutcheson, and whose influence on Smith on Natural Law, including free commerce, was definitive; see Smith's 'History of Astronomy' begun in 1724 while he was at Oxford qualifying to be ordained into the Church of England, a quest he gave up in 1746). The 1872 edition of Moral Sentiments (published by Kessinger Publishing Rare Reprints: Google it) contains Smith's 'History of Astronomy', which is worth reading).

Please be clear, I am not arguing about whether there is a religious dimension to capitalism or not; I am arguing that the religious dimension alleged to be in Adam Smith’s works and thinking is grossly exaggerated, even quite wrong.

I have not detected a strong religious (Christian) element in Wealth Of Nations and my current research into assertions of Smith’s overt religious (including Deist) elements in Moral Sentiments suggests a weak case supporting such assertions too. Partly, the problem is compounded by many religious people of all creeds claiming a monopoly of moral behaviour; the rest of humanity is dismissed as immoral or amoral (some religious zealots, down the ages and even today, think it is their mission to kill apostates).

Adam Smith’s analytical writings on how commercial economies operated do not include a role for divine intervention; even his singular mention of the popular metaphor ‘an invisible hand’ in Wealth Of Nations was not related to anything of heavenly origin; it was related to the simple reaction of some but not all earthly humans to the personal emotions of risk avoidance when contemplating whether to invest their scarce capital at home or abroad.

Those who invested abroad felt less insecure than those that invested at home, and of those that invested at home they added to gross domestic annual product (as we would express it today) by doing so, on the arithmetical principle of the whole is the sum of its parts. This made the invisible hand a metaphor for a very worldly phenomenon.

Ralph Martire sees in Smith’s observations on the subsistence level of lowly-paid labourers and their families a “divinely inspired sense of concern for others”. However, moral philosophers, according to Smith's own definition of their role, were people who ‘did nothing, but observed everything’.

Smith’s unsentimental observations on all kinds of events, histories and behaviours, have been remarked on (for example, on slavery, the role of women in poor families, young boys employed in workshops, girls not educated formally, soldiers on duty, inferiors obsessed with superiors (‘celebrities’), and people awaiting their fate under justice, etc., etc.,).

These observations of Smith's were not ‘divinely inspired’ so much as the normal observations of an educated humanist. If divine inspiration was a necessary condition for a sense of ‘humanity’ there was precious little of it about among people in the 18th century, and even less in the millennia following the fall of Rome (I am not so sure we are basking in mass ‘humanity’ in the 21st century).

Should Richard Martire wish to advance a theory that the ‘hand of God’ is present in the mode of subsistence then that is his absolute right to do so. It is not his right to attribute authoritatively to Adam Smith a theory which Smith did not express, and by extention, attribute the theory to the working of actual economies in the real world.

NB: a correspondent has suggested that my accounts of Adam Smith’s views on (pagan) religion may cause offence to Christians among Lost Legacy’s readers. I assure him and all readers that I respect the right for people to hold and practise their belief systems (and not just those of the numerous Christian churches and sects) and do not mean to offend particular individuals.

My concern is solely with assertions, assumption, and claims that are made from time to time that Adam Smith shared particular religious beliefs on the basis of weak evidence, and the disregard of stronger evidence against, particularly in the context in which Smith had to write and disseminate his moral philosophy and political economy.

Adam Smith Partly Understood

‘DJ Mitchell’ writes in AsymptoticLife.com HERE) writes on “Spirituality and Economics”

"How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it." —Adam Smith, The Theory of Moral Sentiments (1759).

Of the fallacies of modern times, perhaps none is so pervasive and destructive as the belief that capitalism as a system runs on pure greed. "Self-interest" has been redefined as selfishness, and self-benefit is perceived as the only motivation for commerce. Little wonder that we've become a nation led by the greedy, an economy dependent on "hysterical consumerism," a society in which trust is largely relegated to history, and a system of morals in which what is legally permitted trumps what is right.

But Adam Smith, the father of capitalism, told a very different story: "enlightened self-interest" did not mean greed; it acknowledged that a healthy society promotes individual wellbeing. It also recognized a sympathetic desire to help those in need. In other words, at the very root of capitalism is the maintenance of the community of individuals. This includes such antiquated ideas as a handshake as contract, but also the knowledge that a healthy community means better quality of life for everyone who lives there. And, as Adam Smith points out, it means developing charity— giving to those in need just because they need it.

This regard for the wellbeing of others, besides being essential for capitalism to function, brings us to the realm of spirituality: most broadly, concern for that which is outside ourselves. Less broadly, it refers to that which is not material. And in yet narrower (but perhaps most common) usage, it refers to the quest to know God. But this narrow definition should not dissuade us from using the term in its broader sense, as Smith did and as spiritual teachers have for millenia.
“"[A]s we sympathize with the sorrow of our fellow-creature whenever we see his distress, so we likewise enter into his abhorrence and aversion for whatever has given occasion to it. Our heart, as it adopts and beats time to his grief, so is it likewise animated with that spirit by which he endeavours to drive away or destroy the cause of it." —Adam Smith, The Theory of Moral Sentiments.

Action without understanding sometimes has dire consequences for others. A misguided American boycott of products made with Bangladeshi child labor threw thousands of Bangladeshi children out of work, leaving them to starve on the streets. Dutch aid workers had to step in to feed these children. A holistic understanding of the realities in Bangladesh would suggest that, though we object to child labor, it's better than the alternatives currently available.”

Comment
I found this post partially encouraging in that it appears to understand certain aspects of what Adam Smith was attempting to report in his life’s work and I am always grateful for evidence of that.

However, I am less sure that the religious, or ‘spiritual’ slant on his work is justified in what Adam Smith wrote, though ‘DJ Mitchell’ is perfectly entitled to his point of view.

I hope to discuss the spiritual issues raised by supporters of various denominations and separate religions on market economies at some time soon, but I should remark in the meantime that Adam Smith in particular, and markets in general are often assailed by proponents of the view that markets are abominations of their view of god’s purposes and therefore against the teachings that they hold sacred, and also that proponents of alternative views that markets are the very embodiment of their god’s purpose on earth.

That they quote from the same source materials (Adam Smith and the Bible) for these contrary views is quite remarkable, though they often show evidence in their dragging of Adam Smith into their interpretations for either view that they have not understood (possibly not even read) Adam Smith’s Theory of Moral Sentiments or his Inquiry in the Nature and Causes of the Wealth Of Nations, and neither are they familiar with the history of the 18th century.

‘D. J. Mitchell’ seems to have grasped part of what Adam Smith was about, and we should be pleased with that.

A Mystic Writes Arrant Nonsense About Adam Smith and Religion

‘G. K. Chesterton', writing in the Blog, The ChesterBelloch Mandate, a sort of cod catholic ‘distrubutist’ religious sect (HERE):

'Chesterton' posts the ‘Case of Adam Smith’, of which the following is included:

“In giving one or two examples, in this and the next article, I will start with the secular sciences of the early nineteenth century; those before being entangled in the theological struggles. For one case; does anybody realise what a queer and fantastic faith is covered by the very name of Adam Smith? He is considered a dull and stolid person who invented Free Trade; but he invented much more marvellous things. He had a philosophy and even a religion; and a very rum religion it was. Its theological thesis was this: that God had so made the world that He could achieve the good, if men were sufficiently greedy for the goods. If everybody worked meanly and sordidly for money, the result would be a prosperity that would prove the benevolence of Providence. Adam Smith’s idea of justifying the ways of God to men, was to tell the men to do unjustifiable things which God would justify. Adam Smith was a mystic. He was a sort of Quietist, except that he certainly did not tell people to keep quiet. His creed was that if business men would bustle about from purely business motives, the bringing of good out of evil was the business of God. But he believed that God was good; indeed God was apparently the only person required to be good.

Now, of course, most Englishmen do not take a creed in this clear-cut way; and even when they swallowed the Smith philosophy pretty completely for generations, it was mixed up with other things. But when all such allowance is made, what an extraordinary creed it was to swallow! What a weird cosmos it was to inhabit; in which everything was good because everybody was bad. A world in which the financial speculator grew thistles to attract donkeys; and the thistles grew figs to be the food of all the good and wise; in which your neighbour gathered grapes of the thorns you had planted in order to scratch him. The whole thing was much more rationally stated than are most modern expositions; it was also rank raving nonsense, as anyone would have seen in an age of creeds and common sense. Sanity sees at a glance that society finds it hard enough to hang together, with everybody taught to be unselfish; and that it would simply smash if everybody were taught to be selfish. Incidentally, I may add, it has already smashed. We have seen with our own eyes the Wealth of Nations wither into the Poverty of Nations. But there were stranger examples after Adam Smith; and I shall say something of them next week.”

Comment
I could simply dismiss ‘G.K. Chesterton’ as grossly misled as well as offensive in respect of Adam Smith’s legacy.

‘Chesterton’ has run together misleading ideas from the epigones, mainly associated with modern economics associated with Chicago and not with the Adam Smith born in Kirkcaldy in 1723.

'Chesterton' places Adam Smith in the ‘early 19th century’ – he was born in 1723 and died in 1790 – not an auspicious start for a claimed authority on Adam Smith.

“dull and stolid person who invented Free Trade” – not true; many others wrote about free trade (not least among them, David Hume).

“a religion; and a very rum religion it was. Its theological thesis was this: that God had so made the world that He could achieve the good, if men were sufficiently greedy for the goods” – close to being arrant nonsense; Smith never advocated ‘greed’; he called such vices ‘licentiousness’ and severly criticised its exponent ; his Theory of Moral Sentiments was solid (not ‘stolid’) in its advocacy of the virtues in all aspects of human social life.

“Sanity sees at a glance that society finds it hard enough to hang together, with everybody taught to be unselfish; and that it would simply smash if everybody were taught to be selfish” – how true, and how Smithian!

The practice of the positive virtues was an essential part of Adam Smith’s moral and economic teachings, plus the negative virtue of justice. And the instrument of keeping people from selfishness? Why, it was nothing less than the ‘impartial spectator’ from whom nobody could hide when tempted to selfishness. If an individual behaved badly, his impartial spectator would not approve, nor would other people.

If I catch the “promised stranger's” examples, next week, I shall report on them, though this week’s examples do not promise that next week’s will be much better.
Update: The 'Chesterton' Blog appears to be written by Richard Aleman HERE and a note on 'distributism' is HERE

The Parable of the Sentry Who Fell Asleep

This is the first of a series of posts (not necessarily of this length) that I am adding to Lost Legacy as announced last week. These are intended to be educational about Adam Smith's Works and will reflect what I am working on at the time. Comments are welcome, as are questions.

In Book II of Moral Sentiments Adam Smith discusses justice and how it affects all of society. He notes how:

“All men, even the most stupid and unthinking, abhor fraud, perfidy, and injustice, and delight to see them punished. But few men have reflected upon the necessity of justice to the existence of society, how obvious soever that necessity may appear to be.” (TMS II.ii.3.9, p89]

From this observation, he becomes more precise; we focus on individual events and individual perpetrators, and fashion our abhorrent reaction against their conduct on an individual basis; we do not relate it to the broader, Kantian, view that if everybody behaved in that manner then society would crumble. We see this most clearly, says Smith, in the ‘man of humanity’ who contemplates the severity of the punishment of an individual despite the affect on a society:

“A centinel, for example, who falls asleep upon his watch, suffers death by the laws of war, because such carelessness might endanger the whole army. This severity may, upon many occasions, appear necessary, and, for that reason, just and proper. When the preservation of an individual is inconsistent with the safety of a multitude, nothing can be more just than that the many should be preferred to the one. Yet this punishment, how necessary soever, always appears to be excessively severe. The natural atrocity of the crime seems to be so little, and the punishment so great, that it is with great difficulty that our heart can reconcile itself to it. Though such carelessness appears very blamable, yet the thought of this crime does not naturally excite any such resentment, as would prompt us to take such dreadful revenge. A man of humanity must recollect himself, must make an effort, and exert his whole firmness and resolution, before he can bring himself either to inflict it, or to go along with it when it is inflicted by others. It is not, however, in this manner, that he looks upon the just punishment of an ungrateful murderer or parricide. His heart, in this case, applauds with ardour, and even with transport, the just retaliation which seems due to such detestable crimes, and which, if, by any accident, they should happen to escape, he would be highly enraged and disappointed. The very different sentiments with which the spectator views those different punishments, is a proof that his approbation of the one is far from being founded upon the same principles with that of the other. He looks upon the centinel as an unfortunate victim, who, indeed, must, and ought to be, devoted to the safety of numbers, but whom still, in his heart, he would be glad to save; and he is only sorry, that the interest of the many should oppose it. But if the murderer should escape from punishment, it would excite his highest indignation, and he would call upon God to avenge, in another world, that crime which the injustice of mankind had neglected to chastise upon earth.” (TMS II.ii.3.11: pp90-91)

Comment
This is typical of Adam Smith’s use of religious-sounding statements which are taken by Christians, and those readers who find religious beliefs, including Deism, confirmed in Smith’s works, when a closer reading of his sentences suggests the constant element of his deliberate equivocation on all matters of religion and superstition.

This assertion of mine is supported by the context of him being a professor in a university in a strict Protestant country like Scotland, where academic freedom was severely curtailed and where candidates for university chairs had to profess their approved religious faith to be appointed to – and to keep – their chairs.

On his election to the Chair of Logic and Rhetoric by the society of Glasgow University on 16th January 1751, Smith completed the mandatory rituals; he read his dissertation in Latin, ‘De Origine Idearum’, which the assembled professors heard and approved ‘unanimously’ as ‘proof of his qualifications’.
Lectures in Scotland in the early 18th century were delivered in Latin and the dissertation and its delivery would qualify him on that score, as would its contents if they conformed to accepted Protestant theology.

There were other requirements – religious tests were rigorous, not notional – and the assembly of professors adjourned to the local Presbytery of Glasgow where he signed the ‘Calvinist Confession of Faith’ and took his ‘Oath de Fideli’ to be admitted as a Professor of the University. These ritual completed, he returned to Edinburgh as a new Professor of Philosophy (details in W. R. Scott, 1937: Adam Smith as Student and Professor, pp 138-9, Jackson & Son; Ian S. Ross, 1995. The Life of Adam Smith, p 108, Clarendon Press, Oxford).

There are two elements to Smith’s theme in this section of Moral Sentiments. First, his choice of the opinions of “A man of humanity”, a literary device he uses throughout his two major Works, who “must recollect himself, must make an effort, and exert his whole firmness and resolution, before he can bring himself either to inflict it, or to go along with it when it is inflicted by others.”

Clearly, ‘the man of humanity’ struggles within himself to be sympathetic to the official view that the sentry who slept on his watch should be punished by death. It is the quality of mercy that is under strain in such a person, though the sentry’s fellow soldiers at risk and in their beds may be less complaisant.

Smith contrasts the attitude of a ‘man of humanity’ considering the sentry who fell asleep and hoping that he was reprieved, to that of his attitude to “the murderer [who] should escape from punishment”. The murderer’s reprieve for same ‘man of humanity’ would “excite his highest indignation” and he “would call upon God to avenge, in another world, that crime which the injustice of mankind had neglected to chastise upon earth”.

This an example of the sentences scattered about Moral Sentiments that allegedly proves that Adam Smith was religious, but read what follows carefully: “Nature teaches us to hope, and religion, we suppose, authorises us to expect, that it will be punished, even in a life to come.”

The words “and religion, we suppose, authorises us to expect” is not the statement of a true believer; it is a statement of a philosopher deliberately and skilfully weakening an alleged definite truth in his society sufficient for him to remain unmolested by the religious zealots then patrolling the expressed views of people to seek out apostasy and atheism wherever the careless words of people left them open to the trouble the zealots could and regularly did cause when they believed they had found them.

Underlining this view of Smith’s purpose he adds that God’s punishment in the after-life “cannot serve to deter the rest of mankind, who see it not, who know it not, from being guilty of the like practices here”.

God’s justice is not certain, though people believe “that he should hereafter avenge the injuries of the widow and the fatherless, who are here so often insulted with impunity”. The key word is ‘should’, not would.

And he ends with a sentence carefully constructed to evade the hapless vigilance of the zealots:

“In every religion, and in every superstition that the world has ever beheld, accordingly, there has been a Tartarus as well as an Elysium; a place provided for the punishment of the wicked, as well as one for the reward of the just.”

Christians, Protestant and Roman Catholic, share a common belief and it is one that “every religion and every superstition that the world has ever beheld” that the wicked who escape judgment on Earth will surely not escape the wrath of the gods they believe in.

Heaven and hell are beliefs based on hope, shared by many, but were they genuinely shared by Adam Smith?