Adam Smith Meets God and Mammon

During my visit to Australia I was invited to participate in a panel debate with Professors Paul Oslington (Theology and Economics) and Brandon Long (Political Advisor and PhD in Theology from Cambridge) on the subject: “Reconciling and God and Mammon: Adam Smith and how religion shaped his ideas”. The debate was chaired by Dr Oliver Marc Hartwich, a research fellow at the Centre for Independent Studies, Sydney, a think tank akin to the Adam Smith Institute in London (of which I am a Fellow).

About 40 (CIS confirm the attendance was 70 not 40!) people crowded into the CIS library (itself a poignant place for me to visit as it is the location of the ‘P. P. McGuiness Library’ and ‘Paddy’ was a mentor of mine when I was a teenager in Sydney in the 50s – he got me interested in economics and we shared many a debate on history, politics, and current affairs.

We each had 15 minutes, Paul and Brandon sharing the case for Smith being religious and me taking the opposite tack that his beliefs in Christianity faded from his time at Oxford, particularly after 1744.

Because Paul led on the role of the invisible hand (a case of providence), I responded with it being a ‘mere’ metaphor for what drove ‘rich landlords’ to feed the ‘thousands whom the employed’ – the absolute necessity for them to do so – and what drove some, but not all, merchants to invest locally – their insecurity in face of the higher risks of foreign trade.

Brandon found evidence of Smith’s Christianity in religious- sounding statements in Moral Sentiments and I responded with alternative readings of the same statements.

Audience participation and questioning was of a high standard – clearly the audience were divided – and Dr Hartwich chaired the proceedings most fairly, even inviting short-rebuttal remarks from the panellists.

What, with the CIS event and my paper, ‘The Hidden Adam Smith in his Alleged Theology’, which I presented at the Australian Catholic University the day before, it has been a bit of a ‘theological’ visit so far. Certainly, I have learned quite a bit about different perspectives on Adam Smith, with several readings to follow.

I am also happy with the robustness of my critique of modern inventions about Smith’s use of the metaphor of ‘an invisible hand’ and, perhaps more original, my critique of the alleged theologies of Adam Smith. It is in the intense exchange of competing ideas that we refine our understanding of Smith philosophy and political economy.

Adam Smith on Benevolence

John Milbank is quoted in the Faith and Theology Blog (HERE)

"The point about talking about a culture of trust is not some kind of moralistic wishful thinking; the point about a culture of trust is actually that an entrepreneurial culture needs trust. Even if you believe in the free market, it turns out that the model of individualist utilitarianism that goes all the way back to Adam Smith is actually the wrong model. Itʼs the wrong model for the free market itself because if you have endless checking up on people, if you donʼt have trust, that actually inhibits initiative, risk and creativity. This is why the Italian economist Stefanos Zamagni is saying we need to return to the principles of Italian political economy, not Scottish political economy, because the Italian political economists from the 18th century onwards saw sympathy as part of contract itself, not as standing outside contract.

"In the end Adam Smith subordinates sympathy to self-interest and he says that if your butcherʼs selling you meat heʼs not doing it out of the goodness of his heart. But this is untrue. In fact people do enter into economic relationships at the local level for social reasons, for personal reasons, and Zamagni argues in a really powerful way that the more we have relatively informal contracts between people, the more itʼs based on trust, the less you need the intervention of state law on the one hand, or of inner control by firms on the other hand. So this is a different way of thinking about the free market. The market would actually be freer if it was a moral market....”

Comment
Smith's point in the 'butcher, brewer, baker' example is you cannot rely on benevolence alone to feed you (and everybody else), unless you are a beggar. In practice, you must address the butcher's, and etc.,'s interests not your own.

This is not a disavowal of benevolence - there is not enough of it to go round, so to speak. If everybody relied on benevolence for their daily needs, from whence would the objects of such benevolence come from?

This is clear from Smith's Moral Sentiments too. The divine has everything in his benevolent gift - the entire universe in fact - and still more than is needed by all of mankind. Mankind cannot match that degree of benevolence; its wants are many, its access to the means is limited; nature is niggardly, and so, necessarily, is mankind.

God v Mammon: tonight's debate

Tonight's event is a 'God and Mammon' debate in which we are discussing the theme around Adam Smith's views in 20-minute slots plsu a Q & A session.

I plan to include the so-called 'hand of god' version of the invisible hand, if its raised (I speak second), and/or Smith's writings on bargaining (WN I.ii), which were remarkably clear -'give me that which I want and you shall have that which you want' - also kmown today as the conditional proposition. He supports this approach in TMS too.

Remarkably, most neoclassical 'bargaining' models are completely misconstrued. They are based on conflict and zero-sum coercion (Zeuthen, Hicks, Harsani, &co) in strike threats and 'wafare', which is not how people actually bargain. John Nash dropped trying to model bargaining as a process and opted for modelling bargaining as an outcome.

Smith made exchange a ratio, like value - what we give/what we get. I have done my bit over the past 40 years to encourage exchange-bargaining across business and government agencies.

Well, we'll see how we go.

Into the Lions' Den?

Today in Sydney, I am presenting my paper, "The Hidden Adam Smith in his Allleged Theology" to an audience of academic economists, historians, and theologists at the Australian Catholic University.

I make no presumptions about the response of those listening and asking questions, but I am not anticipating wholesome agreement. So far, the response of colleagues - we are all students - has been mixed, varying from genuine curiousity about aspects of Smith's biography, through to utter disdain for my 'presumptions' that Adam Smith was anything less than a devout Calvinist/Deist/Providentialist/stoic or some mixture of all or several of the foregoing.

When, in private conversation with a distinguished Smithian scholar ealy in 2009, I opined that Smith's public agreement with the Calvinist Confession of Faith was tempered by his knowledge that not to do so would eliminate his candiditure for the professorship at Glasgow (1751), he reacted angrily and declared that 'dishonesty' was uterly beneath Smith and he that would "NEVER" have done "such a disgraceful thing", all said with the definite certainty that what I had suggested was at all but impossible, and therefore it was not open to discussion. Polietness and my usual deference in such company led me to desist from pursing the matter.

This afternoon, I shall probably meet similar responses, perhaps, though deference is not a quality I normally associate with Australian academics (no disrespect, but I spent my teens here).

On which topic I shall report later.

UPDATE:

Well, the bit I knew about went down reasonably well, judging by the question-exchanges, but, Oh Dear, I was quietly informed by a participant that I made a crass error on a theological issue: the doctrine of 'atonement', exposing a very weak flank to my credibility among theologians.

Some reading required, urgently! Chastened, I resort to my long-standing belief that we learn from our errors, not from being right. Doesn't help my embarrassment though...

The Australian Catholic University has a lovely campus and the weather remains beautiful. Is it still snowing in Edinburgh?

Tomorrow to a think-tank on reconciling God and Mammon- note to self: don't mention attonment doctrine.

Paper on Adam Smith's Alleged Religious Beliefs

My paper on the alleged religiosity of Adam Smith – admittedly, those who assert that he was religious in some way, are in a majority at present – is now available from the Social Science Research Network:

Kennedy, Gavin, The Hidden Adam Smith in His Alleged Theology (December 16, 2009).

Available at SSRN: http://ssrn.com/abstract=1524409

I have received some very helpful comments on it from readers and from two anonymous referees, and one of my next tasks is to complete the revision of the paper – shortening it for example – but also re-casting some of my statements to take account of reader’s comments and my re-thinking since I presented it at the History of Economic Thought Annual Conference meeting at the University of Colorado, Denver in June 2009.

[In Australia on 10 February (13:00-15:00), I am to present the paper to an academic audience at the Australian Catholic University, School of Arts and Sciences Research Seminar Series 2010, Sydney, and on 11 February I am participating on an early evening panel to discuss, “Reconciling God and mammon: Adam Smith and How Religion Shaped his Ideas”.]

Adam Smith as Theologian

Michael Kruse sent a comment to Lost Legacy but it has 'disappeared', once again. He referred to the publication by Routledge of papers from the conference sponsored by the Templeton Foundation on "Adam Smith as Theologian", which are edited by Paul Oslongton.

The upshot is that Michael looks forward to my review of the papers. As is, I intend to do that, having read some of the papers from the conference, and corresponded with the authors.

At present I am editing my own paper (not part of the conference!), The Hidden Adam Smith in his Alleged Theology, in response to anonymous referees with a view to it being published in a journal (details later if and when it is accepted).

I am also presenting this paper to a seminar chaired by Paul Oslington at the Catholic University of Australia on 10th February in Sydney at 1 - 2.30.

I should make clear that Paul does not agree with my hypothesis. That, of course, is how knowledge improves.

Adam Smith as Theologian?

James Otteson, joint professor of philosophy and economics at Yeshiva University in New York, posts on his blog HERE news of a new book from Routledge, under the title: Adam Smith as Theologian, which is edited by Paul Oslington, professor in economics and theology at the Australian Catholic University, Sydney

Worth a Look: "Adam Smith as Theologian"

"Routledge is bringing out a fascinating collection of articles (disclosure: one of them is mine) on the theological underpinnings of Adam Smith's work. Entitled Adam Smith as Theologian, it is edited by Paul Oslington, who is joint chair in economics and theology at Australian Catholic University. The essays were written for an enormously stimulating conference sponsored by the Templeton Foundation that was held in January of 2009 at the University of Edinburgh, Scotland.

James Otteson writes; “One might be surprised to hear that Smith even had a theology, let alone that a series of penetrating essays could be written on the subject. (Perhaps only a conference on "David Hume as Theologian" could be more surprising!)” I concur with James’ last statement teasing about David Hume.

Last January I was invited to attend a session of the conference – dinner actually, and very nice it was too – and gave a 15-minute talk on "Adam Smith in Edinburgh" to the conference diners in the side-room of a lovely restaurant.

Earlier that day I had accompanied Paul Oslington – a young academic of impeccable manners – in a short tour of Edinburgh’s High Street/Royal mile between the castle and the Holyrood palace. We started at the new Adam Smith statue, just beyond the Mercat Cross and opposite what is now Edinburgh City Chambers (a splendid local government building, where Adam Smith worked from 1778-90 as a Scottish Commissioner of Customs and the Salt Duty) and walked down towards the palace, past John Knox’s house (a formidable firebrand protestant preacher), to Smith’s grave in the Canongate Churchyard), looking a lot better since it was tidied up from a donation from Canada.

Unfortunately, I did not have the keys then to Panmure House,* where Smith lived with his mother, his cousin Janet and his nephew and heir. We walked round it instead.

I look forward to reading the conference papers. Clearly, the contributors take a different stance on the subject of Smith’s Theology – the title is as provocative as you can get (in the nicest possible way, of course). Next month, 11 February, to be confirmed, I am to attend a seminar at the Australian Catholic University, Sydney, at the invitation of Paul Oslington, to which I look forward, where no doubt we shall discuss themes around Smith’s alleged theology.

For those interested, my paper, written before (but NOT for!) the Edinburgh Templeton Foundation conference, “The Hidden Adam Smith in his Alleged Theology” is available on request from me (gavin aT negweb. DoT com).

For those curious about Paul Oslington’s edited volume, here is the list of papers in it:

Smith in Context 1. The Influence of Religious Thinking on the Smithian Revolution Benjamin Friedman 2. Smith and Natural Law John Haldane 3. Smith and Augustine Eric Gregory 4. Christian Freedom in Political Economy: The Legacy of John Calvin in Adam Smith Joe Blosser 5.Providence and Adam Smith’s Invisible Hand Paul Oslington Part II: Analysis and Assessment of Adam Smith’s Theology 6. Economics as Theology: Adam Smith’s Wealth of Nations Anthony Waterman 7. Adam Smith, Natural Theology, and the Natural Sciences Peter Harrison 8. God and Smith’s Impartial Spectator James Otteson 9. Adam Smith’s Theodicy Brendan Long 10. A Divine Economy? Assessing Adam Smith’s Theology Adrian Pabst 11. Man and Society in Adam Smith’s Natural Morality: The Impartial Spectator, the Man of System, and the Invisible Hand Ross B. Emmett Part III: Contemporary Reflections 12. The Contemporary Relevance of Adam Smith Arjo Klamer 13. The Moral Basis of Capitalism: Reflections on Adam Smith’s Theory of Moral Sentiments Paul S. Williams.

It’s available in 2010 (the publishers say on 1 November: ISBN 978-0-415-88071-8)

[*] Panmure House is now owned by Edinburgh Business School (my former day job) and History of Economics Society members visiting Edinburgh who contact me may get access, assuming I am available, and reconstruction work permits.

A New Myth for the Myth of An Invisible Hand

“Steve” posts (27 December) at Radimisto HERE:

‘THE "INVISIBLE HAND" MYTHOLOGY’

"In his biography of Adam Smith, Ian Simpson Ross attributes Smith's belief in an invisible hand that makes free markets work as if there were a Free Market Fairy derives from his readings in Stoic philosophy. I didn't realize the Stoics had anything that could justify this, so I went to the online Stanford Enccyclopedia of Philosophy and read the entry on Epictetus and found this:
Equally important for him is that human rationality has as its setting a maximally rational universe. His confidence in the fundamental orderliness of all things is expressed in frequent references to Zeus or “the god” as the designer and administrator of the universe.

This also explains why Smith also used the "invisible hand" argument decades before he wrote the Wealth of Nations.

1The life of Adam Smith / Ian Simpson Ross.
Oxford : Clarendon Press ; New York : Oxford University Press, 1995.”

Comment
This looked promising, at least in the title.

Ian Ross’s biography of Adam Smith is about as definitive as can be got. In fact, a second edition is in press at the moment and should be published in 2010.

However, a lot of water has gone under the bridge since its first edition in 1995 and I look forward to reading his treatment of aspects of Smith’s writings, including his current views on the significance for Smith of his use of the invisible-hand metaphor.

I had several discussions with Ian Ross at academic conferences at Balliol College, Oxford and in Edinburgh (the latter including a memorable visit together to Panmure House, Edinburgh, Smith’s last residence from 1778-90; now owned by Edinburgh Business School, Heriot-Watt University).

Ian has also read my paper, “Adam Smith and the Invisible Hand Myth”, in the May 2009 edition of Economic Journal Watch (ejw_wat_may09_kennedy.pdf) and while keeping his proper, because neutral, distance as Smith’s biographer, he made some useful comments in subsequent correspondence. I do not think you can with justics accuse Ian Ross (or indeed Adam Smith) of believing in a “Free Market Fairy”.

Smith as a classical scholar, in both Moral Sentiments and Wealth Of Nations, was more than familiar with stoic philosophy – he taught philosophy after all – but I find no connection between stoic philosophy and his two uses of the invisible-hand metaphor, once only in each of his two books (and once only in an early juvenile essay on The History of Astronomy, began in 1744, which had nothing to do with economics, or stoic philosophy).

Indeed, I would go so far as to say that the proponents of the invisible-hand metaphor, who give it great significance (especially since the 1940s, but rarely before then, right back to the 18th century) always, almost without exception – I may have missed one or two – never discuss in any detail the exact contexts in which Smith used the metaphor. The attribute the metaphor to Smith's theory of prices, of markets, of supply and demand, and growth, all anlaysed in detial in Books I and II of Wealth Of Nations without mentioning the metaphor; yet his only use of it is once in Book IV.

They de-contextualise and introduce separate philosophical references, and quote what others – never Smith – said about loosely related issues, as if the views of others are important for deciding on issues of the significance of his rhetoric for Smith.

For instance, I have not yet seen any discussion by believers in the mythology of the invisible-hand which analyses the paragraphs preceding the use of the metaphor, or the exact contexts (quite often they get the meaning of the ‘invisible hand of Jupiter’, the Roman god in his Astronomy essay, quite wrong), which I find significant. If you do not discuss – virtually hide- the context, you mislead yourself and your readers.

As for Smith on religion, see my 2009 paper, ‘The Hidden Adam Smith in his Alleged Theology’ (available on request from: gavin AT negweb dOt com).

Steve’s theory, sadly, like his title, is empty of what it promised.

Mistaken Identity?

Mark W. Hendrickson, a faculty member, economist, and contributing scholar with the Center for Vision & Values at Grove City College, writes (12 December) for the Catholic Exchange Blog (HERE):

"The Theory of Moral Sentiments: Adam Smith’s Timely and Timeless Classic"

“2009 marks the 250th anniversary of the publication of Adam Smith’s masterful treatise on ethics, The Theory of Moral Sentiments. Smith, primarily known today for his hugely influential 1776 work on political economy, The Wealth of Nations, was a professor of moral philosophy. The Theory of Moral Sentiments is stunningly relevant today.

Whereas The Wealth of Nations featured the “invisible hand,” the metaphor that dominates Moral Sentiments is “the impartial spectator.” The “spectator” represents one’s conscience-one’s ability to perceive the divinely ordained objective standard of right and wrong.

In Smith's view, conscience is both a divine spark in mankind and also the product of reason. Indeed, Moral Sentiments (like western civilization itself) is a synthesis of Greek Stoic philosophy and Christian thought.”Comment

Take this strange sentence:

“The Wealth of Nations featured the "invisible hand," the metaphor that dominates Moral Sentiments is "the impartial spectator."

I say “strange” because both Wealth Of Nations and Moral Sentiments “feature” (if that is the correct description) the invisible hand metaphor, in both cases by a single mention only, along, it must be said, with many other metaphors, some on only one occasion, too.

Mark W. Hendrickson goes on to assert that on Moral Sentiments ‘the metaphor that dominates Moral Sentiments is "the impartial spectator."

Now the word “dominates” is a lot stronger than “features”, itself in this context an overly-strong reference for a metaphor used on only one occasion.

Being an economist, Mark W. Hendrickson, must know that Adam Smith used the metaphor in Wealth Of Nations only once (Book IV, Chapter 2, p 456).

I suspect that his reference to the metaphor being a “feature” of Smith’s work reflects the impression that many non-economists (and not a few economists, including from top universities) who haven’t read Wealth Of Nations – and a few that have – who rely on the ubiquitous references in modern media to the invisible hand assume that the metaphor was uniquely popular with Adam Smith solely because everybody believes it was major feature of his works. But it wasn’t.

Moreover, Mark asserts that ‘the "spectator" represents one's conscience as one's ability to perceive the divinely ordained objective standard of right and wrong’.

I have shown in my

“The Hidden Adam Smith in his Alleged Theology” *

, that the widespread belief (more likely, the knee-jerk repetition of assertions made by others) that Smith believed in divine origins as a source of ‘harmony’ in commercial society – or that the ‘hand of God’ controlled the so-called ‘invisible hand’ - are at a minimum questionable, and, to my mind, they are compromised by a close reading of what Adam Smith actually wrote in Moral Sentiments, especially the sixth ad last edition, and considered along with biographical facts about his life.

[* (presented to the History of Economics Society, University of Colorado, Denver, June 2009 – copies are available in PDF from Lost Legacy: gavin At negweb dot com.]

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.