A fine biography of a very fine gentleman
The Authentic Adam Smith: His Life and Ideas
by James Buchan (2006, Norton)
Novelist and critic James Buchan employs his considerable writing skills to sketch out a concise yet intellectually comprehensive profile of one of the leading figures of the Scottish Enlightenment. The person of Adam Smith has long been used as an icon by political conservatives and free marketeers to propagandize their laissez-faire ideology, an anti-Marx effigy paraded before the masses to ward off the evil spirits of social empathy. Doctrinaire stalwarts such as Alan Greenspan —with whom Buchan starts off the book, benignly neglecting the more glaring but superannuated standard-bearers, Margaret Thatcher and Ronald Reagan— relentlessly enshrine Adam Smith as the prophet of liberty, a liberty largely defined by —and mostly confined to— private business interests. Unstated but ever present is the doctrinaire’s message that here is the apostle of absolute truth, for somehow, we are supposed to believe, Adam Smith was obviously infallible.
Buchan does a great service to the contemporary affluent masses by presenting the real Adam Smith shorn of all mythical overtones. What emerges is an even more admirable personage. One of the first myths to go is that of the Promethean economist. Smith was but one among many thinkers in Europe to study the problem of commerce in the mercantilist societies of the preindustrial age. Smith’s renowned work, An Inquiry into the Nature and Causes of the Wealth of Nations, was not the first to broach the subject although it “more or less defined the field of inquiry known as political economy until the late nineteenth century.” Indeed, Buchan points out that Smith borrowed the denominative term from James Steuart’s An Inquiry into the Principles of Political Oeconomy, published nine years before The Wealth of Nations. Which was the natural thing to do, I might add, since Steuart’s choice was the apposite name.
Smith’s most celebrated term, the notorious “invisible hand,” receives due attention right from the start. “The phrase ‘invisible hand’ occurs three times in the million-odd words of Adam Smith’s that have come down to us, and on not one of those occasions does it have anything to do with free-market capitalism or awesome international transactions.” Golly gee whiz, read and learn. The initial occurrence is found in “The History of Astronomy,” Smith’s first philosophical essay which nevertheless was published posthumously. “In this its first avatar,” explains Buchan, “the invisible hand is not a commercial mechanism, but a circumlocution for God.” The second appearance comes in The Theory of Moral Sentiments, considered Smith’s magnum opus until “the rise of political economy amid the battles and factory smoke of the Victorian age.” Buchan argues that “The Invisible Hand here is like the Great Superintendant, or Superintendant of the Universe, or Great Conductor or Benevolent Nature and all the other deistic codewords that litter the Theory.” God by this time has become the more distant and impersonal Providence. The Hand’s third apparition is the only one to show up in the Wealth. Discussing how a merchant would rather invest at home than abroad in order to keep an eye on his capital, thus rendering the greatest possible revenue to his own society, Smith states that “he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.” A fitting observation, yes, but not exactly a passionate defense of raw, unfettered capitalism. Buchan gives us a glimpse of what Smith really thought of these merchants: ” ‘The proposal of any new law or regulation of commerce’ that arises from the merchant class, therefore, ‘ought always to be listened to with great precaution.’ ” In all likelihood, Smith would have included their modern ideological apologists in the warning as well. Later on in the book the Hand just disappears, substituted by the more rational if less poetic (and rhetorically worthless) “private interests and passions of individuals.”
As with the name for the field of economics and even with the title of his first masterwork (due to his knowledge of L.J. Levesque de Pouilly’s Théorie des sentiments agréables), Smith was in some debt to yet another thinker for the basic notion of the invisible hand: Bernard de Mandeville, author of the controversial The Grumbling Hive, expanded and republished as The Fable of the Bees: or, Private Vices, Publick Virtues, which stirred up in England a veritable hornets’ nest. Mandeville’s point was “that all public benefits arose from vices,” vices being, in essence, self-interest. But “Mandeville wrote like a pimp,” Buchan assures us, “and his blend of moral anarchy and gutter utilitarianism” did not go down well in proper English circles. The brazen satirist had it coming, and Smith dutifully joined in to denounce Mandeville in the Theory, though he did well absorb a clever point or two. This second clever Mandevillean point was none other than the Wealth’s fundamental concept of the division of labor, yet another instance of strategic Smithian borrowing.
Still, Smith was no plagiarist. Ideas do not arise in a vacuum but are always the product of the times, and Smith did develop and refine those ideas legitimately. It was his good fortune that his times were rich in world-class thinkers, beginning with his best friend, David Hume, a giant of modern philosophy who is always at hand in the narrative. (Incidentally, Hume also had already discussed the “partition of employments” in A Treatise of Human Nature, in accordance with the spirit of the times — which in this particular regard stretch all the way back to Plato.) This I found to be marvelous of this book, that Buchan takes the reader on a grand tour of the thinkers and doers of the period in their historical context. All presented in a most elegant literary prose. What more can one ask for? A detailed index? It’s there, one of the best to be consulted. The Authentic Adam Smith is a pleasure to read. I would suggest you savor the feast at your earliest convenience.