Tag Archive for: AdamSmith

Weekend Read: Adam Smith’s Liberal Path

Estimated Reading Time: 10 minutes

The title “The Godly Path to Adam Smith’s Liberal Plan” refers to Smith’s politics. He put it this way: “allowing every man to pursue his own interest his own way, upon the liberal plan of equality, liberty and justice.”

My topic is the Godly path. When does it begin? One answer is with what is told of in Genesis, so billions of years ago.

But I jump to 10,000 BC, when our ancestors lived in small bands of 40 people. Between then and 1776, our culture changed a great deal, but our genes did not, and still have not. Genetically and instinctually, we are still band-man.

As band-man, we—that is, our ancestors—were integrated into the band. Those 40 people were all-in-all, ethically. Naturally sympathetic and social, we had a direct sense of the good of the whole, and there was no whole higher than the band.

We have an instinct to have direct social signals that tell us what to feel and to do, in a way that is consensus-oriented and immediately observable. The band was the direct and immediate basis for meaning and validation. Interpretation was simple and common to all.

Indeed, language was primitive, so critical thought would be minimal even if tolerated. We lived an existence of common knowledge, something still yearned for, today.

The good of the band constituted the basis for the spirit or god of the band, as Emile Durkheim said. Experience was encompassing, sentiment was encompassing. Our ancestors knew what Durkheim called effervescence—a holy experience of communion with the spirit through communion among the whole.

Today, however, society is complex; knowledge is wildly disjointed. A blooming, buzzing confusion.

To us, the band seems like a cult. The word “cult” is pejorative, but, in the band context, cultishness made sense. It worked in such a small simple all-in-all society. And we still have a bent toward cultishness.

The Godly path to Adam Smith’s liberal plan is a path away from cultishness.

The next moment is the ancient world—say from Homer to Constantine. Here, I begin to crib from Larry Siedentop, Inventing the Individual: The Origins of Western Liberalism (2014). Siedentop’s story goes from, say, Homer to 1600.

Siedentop says that Christianity made liberalism possible. I agree.

Siedentop anchors his story in the ancient world, which was also quite thoroughly cultish.

Why do I anchor the story, earlier, in the primeval band? It is because I think that to understand ourselves, our lapsarian selves, we need to see ourselves as band-man. For one thing, band-man helps us interpret politics, as Friedrich Hayek suggested. Many would anchor the story in Genesis, and that’s fine by me: But I suggest you give a chapter to band-man.

So, Siedentop describes the cultishness of the ancient world in three chapters, “The Ancient Family,” “The Ancient City,” and “The Ancient Cosmos.”

The primary seat of religion was the family, which was a cult, the paterfamilias being its priest. The ancient world was a compound of nested cults, from the family up to the city, each level having its God corresponding to the good of the group.

Siedentop richly describes that cultishness; I highlight a few things:

  1. The ruler or the king was a top priest, if not a god.
  1. Within the polity, the unit of subjection was the group, down to the family, not the person—the vast majority of persons lacked the status of citizen.
  1. The man or woman was to the compounded group as a foot to the body, and was to conform to the cultish cues that constituted the common interpretation of the cosmos. The man or woman was not charged with thinking, really, except for learning the program. He or she was simply to get with the program, which was cultishly unequivocal and unambiguous, — ya ’know, “Follow the science.” The foot does not think.
  1. The man or woman was not expected to have a conscience, nor even a soul. It was the family that had a soul and an immortality.
  1. What about those who did not get with the program? Ya’ know, the spreaders of mis-, dys-, or mal-information? To think or talk outside the hardened compound cultishness was to be an ‘idiot.’ Looking back, we might say that it was a contest between cultists and idiots. But the idiots were also sometimes treated as traitors or domestic terrorists. Miscreancy was a kind of treason.

The next big development is universal benevolent monotheism, which was fundamentally at odds with the polytheistic hardened compound of nested cults. Following Judaism, other monotheistic trends, Socrates and Plato, and the example of willful lawmaking by the top dog in Rome, there came Christianity.

Siedentop does not claim originality. He draws heavily on a small set of authors. Many others have argued that Christianity made liberalism possible.

What’s so remarkable about Christianity?—Putting aside, that is, the Incarnation and the like.

Siedentop expounds it richly, giving special importance to Paul and Augustine, and telling of further development through the centuries. I list points about Christian ontology and associated Christian moral intuitions:

  1. God loves his creatures, who are called to become his children.
  1. Everyone is a creature made in his image, Imago Dei.
  1. God’s benevolence extends to humankind universally, including posterity. That expands the field of “the whole” far beyond your family or city or nation.
  1. To cooperate with God you must advance what he finds beautiful, the good of the whole. That sets the human to figuring out how the world works, and, indeed, what constitutes goodness.
  1. The very nature of what your well-being consists in changes fundamentally: What becomes the cardinal matter of your well-being is God’s approval of your actions. You might be stuck in the wilderness in a hailstorm with nothing to eat, but if you have been conducting yourself kindly, bravely, or otherwise virtuously, you don’t feel so bad, despite the hail and hunger.
  1. Your conscience is a representative of God—not necessarily a good representative, but a representative nonetheless.
  1. God stands separately from any temporal cult. He stands separately from Caesar. Indeed, He stands above Caesar, who, after all, is but another creature of God. The spiritual is above the temporal.
  1. Godliness may call on you to be, if not a rebel or an insurgent, at least an “idiot,” remaining true, in word and belief, to your conscience.

Much comes from these Christian moral intuitions. They turn the world upside-down. They fundamentally challenge cultishness, which is so tied up with temporal power and status.

There are some things about the Jesus story that Siedentop does not emphasize that I think significant:

  1. Jesus was not a political leader. — In fact, a carpenter.
  1. He never wielded a sword. “Prince of peace” seems fitting.
  1. He was crucified by the top political power, and not as some kind of combatant. — What better way to launch a government-skeptical outlook than to have the messiah fall victim to government and its initiation of coercion?

Siedentop explains how the ontological views and moral intuitions developed, and why it took so long to translate into social and political practice, to the extent they were translated into practice.

For a treatment of Siedentop’s entire book, let me point you to a project posted at the Institute of Intellectual History at University of St. Andrews. There is a complete set of presentation notes to follow along.

Some conceptual points deserve mention.

The title is: Inventing the Individual. Christendom would see the world as being inhabited by individuals. Such individualism was a flipside of Imago-Dei universalism.

Christianity battled the cult of family or clan. The church restricted not only polygamy but cousin-marriage and such. Today, that development is hailed by WEIRD scholars—Western, Educated, Industrialized, Rich, Democratic. Our story is one of cultists challenged by ‘idiots,’ who spawn weirdos.

The standing of the individual before God provided a model for the standing of the individual before the sovereign. Here we take care to distinguish among three kinds of superiority, and hence three kinds of inferiority. There is the inferiority of me as I stand before Novak Djokovic in tennis. Then there is the inferiority as I stand before the sovereign or governor. Then there is the inferiority as I stand before a God-like being. The point is that the divine relationship made a model for politics: In the jural relationship the unit of subjection became the individual.

Now, emphasizing subjection may not seem very liberal. But that, in my view, is a problem with certain strains within liberalism, and not the Smithian strain. With the subjection of the individual comes, well, the individual, and hence consideration of his or her interests and rights.

Every individual is a child of God, and every individual, including the governor, bears a responsibility to advance the good of the whole. The king is a jural superior, but morally he stands equally before God and with the same kind of responsibilities. Thus, Christian moral intuitions opened a path to a liberal approach to politics, with checks, limitations, divisions, responsibilities bearing on governors. Christian moral intuitions are themselves a check on power.

What’s more, the subjection of the individual clarifies jural notions between subjects; that is, between neighbors, who are jural equals in relation to one another. That system of jural relations then serves as a baseline. The subject may say to the sovereign: Hey, my neighbor isn’t allowed to take my stuff, so if you’re going to take my stuff you ought to give us a good reason.

At the end of the book is a chapter titled “Dispensing with the Renaissance.” Renaissance means rebirth. But the so-called Renaissance was not a rebirth of ancient ways, as ancient ways were highly cultish. Thinkers of the so-called Renaissance and Enlightenment misunderstood their history and the development of their own presuppositions. Machiavelli, Montaigne, Voltaire, Paine sustained presuppositions of the individual, a legacy of Christianity. And in assailing Christianity or the Church they often were throwing the baby out with the bathwater. Other liberal thinkers, however, knew better, and it is they, like Lord Acton, who best represent liberalism.

Here, an important idea in Siedentop is that there is always the danger of the church being too submerged within the temporal powers. If the church passes into being a tool of those powers, then there is little liberal prospect. Submergence might explain why Eastern Christianity did not give rise to liberalism, and why other monotheistic regions did not. In the so-called Renaissance and Enlightenment, many thinkers saw the church as part of the problem. They looked at the Catholic church and thought: What have you done for me lately? They didn’t understand the evolution of their presuppositions, and threw the baby out with the bathwater.

In an Epilogue, Siedentop highlights two senses of the word ‘secular,’ one about religious belief, the other about separating church and state. Someone can be secular in the one sense but not the other. One who is avid both for God and for separating church and state is a theistic secularist. The point is that the liberal secularist owes a lot to Christianity, and in both senses: Both the liberal non-theist and the liberal who favors separating church and state owe a lot to Christianity.

Now I add some points to Siedentop’s story, with the period 1600 to 1776 in mind.

Deirdre McCloskey explains that in the 17th and 18th centuries there bubbled up the moral authorization of the pursuit of honest income. That moral authorization, together with the related liberal trend, invigorates economic life, bringing dynamism, innovation, and the Great Enrichment. I agree.

Now, what does it take for something to become morally authorized?

First, the moral authorization of something depends on moral authorities. Some authors with influence were not clerics, such as Pieter de la Court, John Locke, Daniel Defoe, Joseph Addison, Richard Steele, and David Hume.

But moral authorities based in the church especially moved society and sealed the deal. I highlight Protestants I know a bit about, and along the lines that Max Weber suggested. Luther and Calvin moved things toward that moral authorization, but, at least in Britain, especially noteworthy are such ministers as William Perkins, Richard Baxter, the Richard Steele of the 1684 The Trades-man’s Calling, Francis Hutcheson, Joseph Butler, and Josiah Tucker. Most of these men had great influence. These godly men morally authorized the pursuit of honest income.

But, second, for something to become morally authorized it is necessary, in the first instance, that that something be sufficiently clarified. Something has to be a thing before it is morally authorized. If the pursuit of honest income is to become morally authorized, people need to know what “honest income” is.

So, what is honest income?

Here I turn to jurisprudence. Hugo Grotius wrote of a basic form of justice called expletive justice; Smith called it commutative justice. It’s the duty not to mess with your neighbor’s person, property, and promises-due. Jural theorists explicated what counts as property, what counts as promises or contract, and what counts as messing with any of that. Building on Francisco Suárez and other Spanish writers, Grotius was a giant, as was Samuel Pufendorf, whose work was more utilized in Britain, flowing into Smith’s predecessors at Glasgow.

The point is that jurisprudence needed to clarify something like “honest income” in order for something like “honest income” to be morally authorized. Honest income was income flowing from activities that, at least at minimum, did not violate commutative justice.

This jurisprudence element belongs to the godly path. Grotius wrote a book titled The Truth of the Christian Religion and Pufendorf wrote of divine law. Jural theorists saw natural jurisprudence within God’s laws. Godly social life called for a social grammar, and commutative justice was a system of social rules making for a social grammar.

We see in the writings of these clerics a progression in their discussion of calling. In Luther, it is working hard, even piously, in your job. Writers suggested something like a list of the jobs that were elect callings. But there is a general movement toward greater abstraction:

  • The list was expanded to include more of the familiar jobs, now also deemed elect.
  • There is discussion of choosing your calling from those on the list.
  • And then combining callings.
  • And switching among callings.
  • And then adding wholly new callings to the list; that is, innovation.

All this drives toward reverting instead to the basic idea of honest income—that is, scrapping entirely the idea of a list. Whatever way you earn income, as long as you kept within the bounds of commutative justice (as well as other important bounds), the income was kosher, even praiseworthy. The clarification of commutative justice made possible an open, expansive, innovation-friendly idea of serving God by pursuing honest income.

The flipside of not messing with other people’s stuff is others not messing with your stuff. The sovereign not messing with people’s stuff is liberty. Liberty is a flipside of commutative justice. Thus, clarifying commutative justice meant clarifying a set of principles—or rights—that subjects could claim against their governors.

Dugald Stewart wrote that natural jurisprudence provided “the first rudiments…of liberal politics taught in modern times.” J.G.A. Pocock put the point succinctly: “The child of jurisprudence is liberalism.”

I think Adam Smith would defend the liberal plan as true to Christianity. In my remarks I have highlighted elements along the path to Smith’s liberal plan. Many of those elements are best understood in reference to a universal benevolent beholder.

Even if one stops short of theistic conviction, one should realize that this pattern of ethical thought owes everything to theism and that this pattern ought to dance with theistic interpretations.

Also, from the point of view of a parent, one should realize that a good way to impart that pattern of thought to your child is to posit God and go from there.

In closing, I raise the question: Can liberalism be sustained in a world of waning belief in God? Tocqueville said that the spirit of liberty and the spirit of religion depend on one another. Hayek ended The Fatal Conceit asking whether people in an age of waning theism will not be inclined to find meaning and validation in cultish politics.

Christianity led to the inventing of the individual, but Tocqueville and Hayek feared that resurgent cultishness would de-invent the individual by crushing liberty and instituting a new form of serfdom.

I believe liberals will do a better job of sustaining their tradition if they realize that—and I think Jordan Peterson says this—our modes of sense-making must involve formulations that are quasi-religious if not fully religious.

With theists, I find in humans a call upward. Cultists may call the miscreant an idiot. But it is only the ‘idiot’ who discovers paths upward, and he or she does so in conversation with other ‘idiots.’

People, even cultists, know, deep down, that we are called upward, and upwardness is admired.

The worse the times are, the more will ‘idiocy’ become us. So, stay hopeful; God isn’t going anywhere.

This article was published by Brownstone Institute and is reproduced with permission.

Encountering the Natives of Flyover Country

Estimated Reading Time: 7 minutes

In the late 19th and early 20th century, it was commonplace for newspapers in the US and Europe to hire what were known as “stringer” journalists who would work on commission to produce stories about the lives of foreigners in distant lands. They might go to Africa or the West Indies, or describe cowboys and Native American tribes on the American frontier. Some, like the renowned German writer Theodor Fontane, traveled all over Europe producing columns for the people back home. As literacy and print media grew, so did the demand for exotic stories.

Glenn Hubbard, former chairman of the Council of Economic Advisors (2001-2003) and now a professor at Columbia University, has in some ways copied this older style. Hubbard’s book, The Wall and the Bridge, is a sort of mish-mash of superficial economic history and recycled public policy ideas. But at its core, this book is a form of stringer journalism about the far-off and exotic land of Youngstown, Ohio.

Hubbard bravely takes a group of MBA students into the wild and savage-filled lands west of New York City to encounter that creature all but extinct on the civilized streets of Manhattan or Brooklyn: the Trump voter. His is not the drama-filled tale of JD Vance, nor the fictional account of Claas Relotius. Instead, Hubbard tries, unsuccessfully in this reviewer’s mind, to craft economic policy prescriptions based on his “experience”  visiting the once-thriving steel manufacturing city. Hubbard wants to use the example of Youngstown to help salvage the prestige and credibility of East Coast intellectual elites like himself, that was lost with the rise of populism in the US and elsewhere.

What this method reveals about Hubbard and his ilk may be far more interesting than the policies he’s proposing. Hubbard first suggests offering job retraining to American manufacturing workers displaced by growing globalization. He awkwardly labels this “reskilling” and “opportunity policy.” None of this is particularly original except for his tired use of awkward terms from public policy. Politicians have been discussing job retraining and education since the 1980s and little of it has translated into widespread success in the American Rust Belt. Furthermore, it’s obviously self-serving for a college professor to trumpet education as the solution to this problem (let’s help these workers by throwing more money at my profession!). On several occasions, Hubbard mentions time spent at seminars at Youngstown State University and speaks highly of the institution. Does he seriously believe “reskilling” steel workers to become psychologists and Women’s Studies majors to be a solution? Additionally, such education programs can only succeed if those prescribing the “reskilling” can accurately predict which jobs will be good and secure, as well as guarantee that workers in places like Youngstown will be able to get them locally.

Second, he proposes expanding “social insurance.” Anyone familiar with Washington-speak, and skeptical of government programs, can understand what Hubbard is proposing here. He’s arguing for the creation of a new welfare program for Trump-landia to help buy them off. Setting aside for a moment the fiscal implications of such a proposal during an era of high inflation, exploding government spending and debt, it is fanciful to imagine that we can arrest support for populism simply by writing checks to rural America. This proposal grossly oversimplifies what’s going on in areas where President Trump won large majorities in 2016 and 2020.

By way of justifying this approach, Hubbard offers a profoundly superficial review of the work of Adam Smith. He correctly notes that among Smith’s more prominent targets in his writing were the mercantilists who supported protective tariffs and the British colonial system, based on a flawed understanding of the nature of national wealth and prosperity. He also accurately describes Smith’s views on the vital role some government policies, such as rule of law, can play in maintaining the market order.

But from there, things go horribly wrong. Hubbard claims that Smith was writing in response to Hume, which is completely wrong—if anything Smith was replying to Mandeville in much of his work. Hubbard proceeds to discuss “neoliberalism,” a term he seems to use in much the same way as those on the modern left, to describe a heartless anarcho-capitalist system. This “neo-liberal” night watchman state would be completely indifferent to the needs of those displaced by the creative destruction. Hubbard compares two “neoliberals,” Hayek and Friedman, to the more nuanced Smith who, for example, supported universal education and public goods such as national defense. Smith’s broader understanding of a widely-shared prosperity, he claims, is the only reasonable foundation for a free market economy in a representative political system.

Sympathy, for Smith, helps explain why we can rein in self-interest and connect with individuals outside of our kinship networks and local communities.

Smith was completely silent on the issue of social welfare or “reskilling” and had significant reservations about manufacturing and industrial work. Hayek in fact supported a limited safety net in The Constitution of Liberty for the exact reason that Hubbard cites. Of course, knowing that that would have involved actually reading more of Hayek, rather than casually labeling and caricaturing him. At the very least, Hubbard is playing fast and loose with both thinkers.

Making matters worse, Hubbard appears to have little understanding of Adam Smith the complete scholar. One really can’t understand the Wealth of Nations without tackling Theory of Moral Sentiments and Hubbard in particular could have benefited from spending some time with Smith’s moral theory.  Smith was first and foremost a moral philosopher, not merely a cold, calculating economist. Smith’s complex explanation of how human social order evolves and functions would take pages to flesh out, but at its core, the argument is based on what Smith called sympathy, what today we’d refer to as empathy. Sympathy, for Smith, helps explain why we can rein in self-interest and connect with individuals outside of our kinship networks and local communities. Sympathy helps curb the external manifestations of self-interest in our social and personal interactions. We listen and try to understand the plight and position of others when we are not interacting with them in market settings.

Hubbard claims that he and his cadre of MBA students sat down and listened to the stories and concerns of displaced steel workers in Youngstown. But when we consider how Hubbard approaches the “problem” of populism among the people of Youngstown, all we see are Hubbard’s own biases and preferences as a neoclassical economist. We don’t see much Smithian sympathy.

Modern economics, with its reliance on simplified models of human choice, struggles to understand why people don’t simply leave Youngstown, or other areas in which support for populism has been robust. Economists like to view the world strictly in terms of mechanical choices and decisions based on material gains and costs. That perspective provides the kinds of “solutions” that Hubbard is proposing here. He does not tell himself that, “these people are making subjective evaluations to stay in Youngstown and we should try to understand why they want to stay and support folks like Trump.” Instead, he reasons that “these people are materially constrained to make bad choices because they can’t afford to make better decisions.” His solution is to lower the costs of leaving or “reskilling” in their decision-making to allow them to make the “correct” choice.  

But is that the solution to the problem, if there really is a problem here? People understand they are materially worse off but choose to stay. Hubbard and his students listened to the people of Youngstown as neoclassical economists. The biases of their training did not allow them to think about their support for populism through a lens of subjective decision making rather than purely materialistic concerns.

A Smithian sympathizer would have gone beyond the economic lens of Hubbard to consider non-pecuniary factors in understanding the people he met. The job losses that Hubbard is addressing here did not just happen in the past few years. Plant closures and steep job cuts began during the Carter administration. The individuals who are still living in Youngstown are not there because they are unable to leave for economic reasons. Like most of the folks living in smaller towns throughout the Rust Belt, they simply prefer to stay. Their world views on topics such as family ties, religion, immigration, sexual norms, social values, and such are as important, if not more so, than economics. They are not trapped by material forces in these areas. They are making choices that a mechanical choice model simply can’t account for.  

Noble Laureate James Buchanan explained the limits of the neoclassical approach in his essay “Is Economics a Science of Choice” by noting that economists want to limit choice to the action of “choosing” a lower objective cost. This removes choice from the process and makes it seem purely objective in terms of economic calculation. Buchanan rightly points out that

[i]n the logic of choice, choosing becomes a subjective experience. The alternative for choice as well as the evaluations placed upon them exist only in the mind of the decision maker. Cost, which is the obstacle to choice, is purely subjective, and this consists in the chooser’s evaluation of the alternative that must be sacrificed in order to attain the which is selected. This genuine opportunity cost vanishes once a decision is taken. By relatively sharp contrast with this, in the pure science of economic behavior, choice itself is illusory. In the abstract model the behavior of the actor is predictable by an external observer.

And make no mistake, Hubbard is assuming away non-economic choice for those people in Youngstown. His book focuses exclusively on that approach and completely misses any possible impact social or cultural factors may have had in the election. In explaining his model early in the book he mentions that manufacturing job losses in rural parts of Michigan, Pennsylvania, and Wisconsin were critical in deciding the election. No one doubts that economic changes played a role in those areas, but Hillary Clinton spent little time campaigning in those states and even less time addressing the non-economic policies that were important to those voters. Nor does he, or really any elite, to this day acknowledge that Clinton lost the female vote for non-college-educated white women, few of whom were employed by manufacturing plants in those areas. Economics was part of a larger story, but it alone doesn’t determine the choices made. Social issues did and continue to play a huge role.

It is perhaps too much to expect an explorer in New Guinea to place himself into the mind of tribes that practice cannibalism. It is not too much to ask an intelligent and highly educated academic with significant political experience to take seriously the idea that economics is only part of what is driving the rise of populism. Voters have reasons for rejecting elite control over policy. One gets the sense that Hubbard, observing a group of natives feasting on human brains, might have concluded that “reskilling” the locals towards tofu factories and organic farming would have solved the problem. I for one have my doubts about this approach.


This article was published in Law & Liberty and is reproduced with permission.