On the Wealth of Nations (15 page)

As absent as Smith's mind was, he was present. He thought highly enough of sociability that he included it in his section on propriety in
Moral Sentiments:
'Society and conversation … are the most powerful remedies for restoring the mind to its tranquillity.'
²⁴
He belonged to a profusion of clubs, from the Royal Society of London to something called the Select Society of Edinburgh, which debated things such as the ideal
size of farms in Scotland and offered a prize to anyone who could 'cure the greatest number of smokey chimneys'. He was even made an honorary captain of the Edinburgh city guard, though whether before or after his performance with the porter I don't know.

Smith must have been a likable man. John Rae tells a story of a French professor of geology being subjected by Smith to an evening of bagpipe music. It was, in the words of the geology professor, 'a most hideous noise'. But afterward the same Frenchman reported that 'there was nobody in Edinburgh he visited more frequently than Smith.'
²⁵

Smith knew David Hume, Edward Gibbon, Pitt the Younger, Sir Walter Scott, Voltaire, Rousseau, Edmund Burke, James Watt, Benjamin Franklin, and le Duc de La Rochefoucauld. It's impossible today to imagine knowing a range of such people. There are no such people.

Smith's closest friendship was with David Hume, whom he met in Edinburgh in about 1750. They were a sort of high-minded, very intellectual Laurel and Hardy without the tantrums or pie throwing, or a Hardy and Hardy since neither was skinny or laconic. A passage in
Moral Sentiments
seems to be the straight man's version of the relationship:

For the Hume version, there is an elaborate set piece, a twelve-hundred-word comic routine in a letter, written from London, to Smith who was in Glasgow awaiting news of how the publication of
The Theory of Moral Sentiments
had been received. Hume lists every important person to whom he's given a copy and provides biographical details of them before saying,

Hume then expends a long paragraph on gossip about who might get this post, leading to gossip about mutual acquaintances and a digression on their friend Lord Kames and his book
Historical Law-Tracts,
of which Hume says,

Which Hume does.

An apposite Latin quotation is inserted followed by a string of further admonishments to equanimity and a story about how the Athenian politician Phocion always suspected that he'd made a mistake when he was applauded by the populace. 'Supposing, therefore,' wrote Hume, 'that you have duely prepard yourself for the worst by all these Reflections; I proceed to tell you the melancholy News, that your Book has been very unfortunate; For the Public seem disposd to applaud it
extremely. It was lookd for by the foolish People with some Impatience; and the Mob of Literati are beginning already to be very loud in its Praises.'
²⁷

In this book, which the mob of literati were loudly praising, Adam Smith wrote that he believed 'the chief part of human happiness arises from the consciousness of being beloved.'
²⁸
Smith was not, however, one of those dreadful individuals of whom it is said, 'He was beloved by all.' Dr Johnson didn't like him. Supposedly they had their first encounter at a party in London, and later that evening Smith turned up at another party saying of Johnson, 'He's a brute; he's a brute.' Johnson had attacked Smith for defending Hume's character despite Hume's atheistic views, and Smith had persisted in championing Hume.

'What did Johnson say?' Smith was asked.

'He said, "You lie."'

'What did you say?'

'I said, "You are a son of a bitch."'
²⁹

This story seems to be not quite true. But let it stand for what transpires from the meeting of the greatest minds of an age.

Apparently Smith and Johnson did have some sort of unpleasant exchange. When Boswell informed Johnson that Smith detested blank verse, Johnson said, 'Sir, I was once in company with Smith, and we did not take to each other, but had I known that he loved rhyme as much as you tell me he does, I should have hugged him.'
*
³⁰

But they must have made it up because Smith became a member of the Literary Club where Dr Johnson was the cynosure. And Johnson defended
The Wealth of Nations,
saying, 'A man who has never been engaged in trade himself may undoubtedly write well upon trade, and there is nothing that requires more to be illustrated by philosophy than does trade.'
³¹

Adam Smith was born sometime early in 1723, the posthumous son of another Adam Smith who had been judge advocate for Scotland and the comptroller of customs in the Kirkcaldy district. A libertarian Freudian, if there is such, could make something of Smith Junior's psychological attitude toward free trade.

His family was reasonably prosperous and reasonably well connected. He spent his childhood in Kirkcaldy, across the Firth of Forth from Edinburgh. His one great adventure happened when he was four. He was stolen by gypsies, though rather anticlimactically found a couple of hours later. Smith biographer John Rae wrote, 'He would have made, I fear, a
poor gipsy.'
³²
I'm not so sure. Instead of telling fortunes and hatching confidence schemes, today's gypsies might be running Citicorp.

Smith attended a little village school in Kirkcaldy that seems to have been somewhat different than the little village school my children attend. Smith began studying Latin at ten. But I doubt he knew how to play 'Kumbayah' on the recorder or to scold his mother for not recycling. At fourteen he was sent to study at Glasgow University, college freshmen being that age in those days. This gave them some excuse for acting like college freshmen, though we have no evidence that Smith did.

Smith's favorite subject was mathematics, which either makes sense or it doesn't, depending on how you think the math works out in a free market economy. Smith's favorite teacher, however, was Francis Hutcheson, philosopher, ethicist, and one of those luminaries of the Scottish Enlightenment whose light is nowadays under the bushel of intellectual history. Hutcheson was the first professor at Glasgow to lecture in English instead of Latin. He was a strong advocate of personal liberty and of the economic part of that liberty, which we take so personally. It was Hutcheson, not Jeremy Bentham, who first declared that the determining factor in morality was 'the greatest happiness of the greatest number'.
*
³³

Smith was partly indebted to Hutcheson for the thesis that the right to property is based on labor. (John Locke had made

a similar argument.) Hutcheson believed man had a right to property because he had a right to benefit from the labor used on that property. And Hutcheson indirectly gave Smith the idea for the Impartial Spectator. Hutcheson concluded that sympathy couldn't be the basis of morality because we often approve of actions taken by people with whom we don't sympathize. Smith saw a way around that argument.

During Smith's first year at the university, Glasgow's Presbyterian clergy tried to excommunicate Hutcheson. He was considered too religiously optimistic, teaching that God gave us ways to know good from evil even if we weren't religious. The fray was survived by Hutcheson, but seems to have impressed Smith. In his works Smith was always averse to religious controversy and, indeed, to religion, but at the same time he managed to be, in his own way, always religiously optimistic.

Smith received a Snell Exhibition, a sort of Rhodes Scholarship of its day, allowing him to attend Oxford University. Smith had been a frail child, and his health was never very good, but he wasn't a wimp. He rode a horse 350 aching miles from Glasgow to Oxford.

He hated the place. 'In the university of Oxford,' he wrote in
The Wealth of Nations,
'the greater part of the public professors have, for these many years, given up altogether even the pretence of teaching.'
³⁴
Smith spent his time in reading that was extensive even by Smithian standards. He read works in Latin, Greek, French, Italian, and English. Smith, who'd been in correspondence with David Hume – although they'd yet to meet – was caught reading Hume's
A Treatise of Human Nature.
This was confiscated by the Tory dons. His stay in Oxford from age seventeen to twenty-three was the only time in Smith's life when he seems to have made no friends.

In 1746 he gave up his Snell Exhibition and went home to live with his mother. He earned his keep giving paid lectures on English literature. Smith liked Pope and Gray and didn't like Milton's shorter, more readable poems. He believed Dryden was a better poet than Shakespeare and agreed with Voltaire that Shakespeare had written good scenes but not a good play. In the preface to
Lyrical Ballads,
Wordsworth would call Smith 'the worst critic, David Hume excepted, that Scotland, a soil to which this sort of weed seems natural, has produced'.
³⁵

Smith himself may not have thought too highly of the lectures. There's a comment in
The Theory of Moral Sentiments
about certain things being 'merely a matter of taste' and having 'all the feebleness and delicacy of that species of perceptions'.
³⁶
Among the self-betterers of Edinburgh, part of the attraction of the lectures was the English rather than the literature. Smith was listened to as someone who had fashionably lost his Scots accent. It is a good thing for us that he did, or reading
The Wealth of Nations
would be like attending the worst kind of Robert Burns recital.

In 1751, when he was twenty-eight, Smith was appointed professor of logic at Glasgow University. He was soon promoted to the more prestigious chair of moral philosophy. Smith was a popular professor. Dr Tronchin, Voltaire's physician, sent his son to study under Smith, and the future prime minister, Lord Shelburne, sent his younger brother. Besides the likes of James
Boswell, Smith attracted students from as far as Russia. Semyon Efimovich Desnitsky and Ivan Andreyevich Tret'yakov would become professors at the University of Moscow, where they preached the ideas of Adam Smith. These did not catch on.

At Glasgow, Smith also served as quaestor, curator of the college chambers, vice rector, praeses of the university meetings, and in other funnily named administrative posts. By all accounts he was trusted and effective. There's an important difference between absentminded and scatterbrained – the difference, for example, between the foreign policies of Britain and France.

Smith called his tenure at Glasgow University 'the period of 13 years which … I remember as by far the most useful and therefore as by far the happiest and most honourable period of my life'.
³⁷
Although Smith wrote that in a letter thanking the university for electing him rector in 1787, and what else would he say? Also, there's the 'therefore' to be considered.

In 1763, Smith was offered a position as tutor, to accompany the seventeen-year-old Duke of Buccleuch to France. And he accepted readily enough.

Smith's opinion of such continental tours was recorded in
The Wealth of Nations:

The Duke of Buccleuch seems to have been a nice young man. He grew up to be, according to the eleventh edition of
The Encyclopaedia Britannica,
'famous for his generosity and benefactions', not the least of which were to Adam Smith. It is to be hoped that Smith was generalizing and/or trusted that the duke would never read
Wealth
.

Smith's job opportunity came from the duke's stepfather, Charles Townshend, the future chancellor of the exchequer, who would kick off the American Revolution with his Tea Duties. But
The Wealth of Nations
hadn't been written. Townshend was impressed with Smith's first book.

Moral Sentiments
also impressed the French. Smith was received in all the most intellectual of salons, although his ability to speak the language was wretched. Perhaps there was a lot of note passing to Quesnay, Turgot, Helvétius, Diderot, and, of course, Mme Riccoboni. If her letter to Garrick is anything to go by, we can imagine the kind of notes she passed back.

On a trip to Geneva, Smith met with Voltaire five or six times. Apparently Voltaire told Smith a story about how their mutual
friend, the old reprobate Duc de Richelieu, had borrowed the embassy plate at Vienna and never returned it. And Voltaire remarked to Smith, as he remarked to others, that 'the English have only one sauce, melted butter.' Meeting of Great Minds, Part II. The French professor who endured the bagpipe music said Smith revered the memory of Voltaire.

At the end of 1766, Smith returned home and went to work in earnest on
The Wealth of Nations.
The book had had its beginnings in a fit of boredom in Toulouse – a better response to the tedium of that city than setting fire to cars in its suburbs. Smith wrote and rewrote for the next ten years.

The publication of
Wealth
had immediate effects, not necessarily good ones. Book 5 was what the men of influence seized upon. Any advice given to government, no matter how reasonable, intelligent, or well principled, has only one result – more government. In 1777 and 1778 the prime minister, Lord North, introduced four new taxes, all suggested, probably inadvertently, by Smith.

There was a tax on menservants, who were engaged in what Smith had categorized as 'unproductive labour', and a tax on inhabited houses because Smith had said, 'The rent of houses is paid for the use of an unproductive subject.'
³⁹
There was a tax on property sold at auction. Smith had unfortunately mentioned that certain property transfers are 'either public and notorious, or … cannot be long concealed' and that 'such transactions, therefore, may be taxed directly.'
⁴⁰
And there was a tax on malt, which meant a tax on beer, that luxurious expense of the inferior ranks of people. Smith's intentions had been
good. He'd merely pointed out, in his consideration of 'Taxes upon consumable Commodities', that 'a greater revenue than what is at present drawn from all the heavy taxes upon malt, beer, and ale, might be raised … by a much lighter tax upon malt.'
⁴¹
But we know what road it is that good intentions pave, and it's not the road to cheap beer.

The Wealth of Nations
had some good effects as well, such as the entire modern free world. Smith's arguments helped shape the Treaty of Paris, ending the Revolutionary War. The Earl of Shelburne, whose younger brother had boarded at Smith's house at Glasgow University, was an early adapter. He claimed to have been converted to Smith's ideas during a trip the two took from Glasgow to London in 1761. Shelburne became prime minister in 1782. The next year he signed the peace with the United States. Shelburne claimed that the Treaty of Paris was inspired by 'the great principle of free trade' and that 'a peace was good in the exact proportion that it recognized that principle.'
⁴²

Four years later Pitt the Younger would evoke the same Smithian principle in his Consolidation Bill reforming Britain's customs and excise laws. Centuries of mercantilist expedients and government grasps at revenue had caused these regulations to grow to the point that 2,537 individual resolutions were required to present the provisions of the Consolidation Bill to Parliament. Pitt also tried to effect Smith's idea of constitutional union with Ireland. The quarrel resulting from that is still going on.

There is a story that a few years before Smith died he went to a house in London where a distinguished company was
gathered, including the Lord Advocate Henry Dundas, Privy Councillor William Grenville, Bishop William Wilberforce, Pitt, and Henry Addington who would follow Pitt as prime minister. They all rose when Smith entered the room.

'Be seated, gentlemen,' said Smith.

'No,' replied Pitt, 'we will stand till you are first seated, for we are all your scholars.'
⁴³

It may have happened. But how the politicians of the world really viewed Adam Smith was probably better expressed by the Tory Pitt's longtime political rival Charles James Fox. It was Fox, not Pitt, who supposedly shared Smith's Whig convictions – political liberalization, social tolerance, support of parliamentary authority over royal prerogative. Fox was one of those
bien-pensant
progressives with messy personal lives, the Ted Kennedy type, who was very in favor of the French Revolution and very opposed to British intervention in the French revolutionary wars and so on. Fox told the author and memoirist Charles Butler that he had never read
The Wealth of Nations
and explained, 'There is something in all these subjects which passes my comprehension; something so wide that I could never embrace them myself nor find any one who did.'
⁴⁴

Therefore, naturally, as any student of politics could predict, it was Fox who first cited
The Wealth of Nations
in Parliament. And his citation indicates the perfect truth of what Fox told Butler:

The political system gave Adam Smith an appropriate compensation, the way the political systems so often reward us for our sins. In 1778, Smith was made a commissioner of customs for Scotland, with a large salary and various prerequisites such as that marching porter at the Customs House door.