To prohibit a great people, however, from making all that they can of every part of their own produce, or from employing their stock and industry in the way that they judge most advantageous to themselves, is a manifest violation of the most sacred rights of mankind.
This statement, in which the “great people” Smith is referring to are those subjects of the British crown that will, a few years later, become the first American citizens, is telling. Not only does the quote display Smith's belief that free trade constitutes one of the fundamental rights of man—a belief which, whether held by Smith or not, would come to be very important in the self-conception of the young Republic—the quote also foreshadows the fact that the major disputes between the Crown and its American colonies were economic. Smith's economic theory is ahead of its time in a number of ways. This statement in particular, however, had it reached the right ears, might have changed the course of history.
To propose that Great Britain should voluntarily give up all authority over her colonies, and leave them to elect their own magistrates, to enact their own laws, and to make peace and war, as they might think proper, would be to propose such a measure as never was, and never will be, adopted by any nation in the world. No nation ever voluntarily gave up the dominion of any province, how troublesome soever it might be to govern it, and how small soever the revenue which it afforded might be in proportion to the expense which it occasioned. Such sacrifices, though they might frequently be agreeable to the interest, are always mortifying to the pride of every nation
Many of Smith's economic arguments are based on the idea that men are governed by rational, calculating thought and motivated purely by self-interest. He believes that it is this self interest that regulates the market, and ensures that prices and investments will adjust so that wealth is dispersed in the most efficient possible manner. However, at a few points in the work, Smith acknowledges the tendency of men to overestimate their own capacity for luck or good fortune, or to be misled by pride. It is in statements like the one above that Smith demonstrates that there are certain flaws of hubris that would upset the clockwork of wills counter-balancing one another. His statement about Great Britain is also deeply relevant, given the impending American Revolution.
Without the assistance and co-operation of many thousands, the very meanest person in a civilized country could not be provided, even according to, what we very falsely imagine, the easy and simple manner in which he is commonly accommodated.
The quote captures Smith's description of the complexity and scope of the division of labor, and its ability to increase the standard of living in a given society. Smith believes that the propensity to truck, barter and exchange is part of human nature, and it is precisely this capacity that best organizes the economic system in large scale societies. The cooperation of the many thousands, inspired by each person's self interest, is what allows for the economic system to flourish, spreading opulence and raising the overall quality of life. Since observations on the progress inspired by the division of labor begin the book, Smith uses the contemplation of simple items (pins, for instance) as a starting point for his theorizing on the organization of economics in general.
The labor of some of the most respectable orders in the society is, like that of menial servants, unproductive of any value, and does not fix or realize itself in any permanent subject, or vendible commodity, which endures after that labor is past, and for which an equal quantity of labor could afterward be procured. The sovereign, for example, with all the officers both of justice and war who serve under him, the whole army and navy, are unproductive laborers.
Beyond relating Smith's clever distinction between productive and unproductive labor, this quote shows that Smith has no particular social allegiances to the wealthy or the bourgeoisie. Not only does Smith give a thorough criticism of the landed aristocracy, but he also conveys his well-founded suspicion of the wealthy bourgeois class by constantly reminding readers that they are, insofar as they participate in the economic system, linked to the efforts of productive laborers. This selection is especially poignant in light of the fact that Smith believes that professions are generally based not on natural talent or inherent worth, but on upbringing and habit. The creation of certain social classes is based on a number of contingencies, not on the inherent worth of persons, and, we are reminded, each class depends on the other.
Labor was the first price, the original purchase money that was paid for all things. It was not by gold or by silver, but by labor, that all the wealth of the world was originally purchased; and its value, to those who possess it, and who want to exchange it for some new productions, is precisely equal to the quantity of' labor which it can enable them to purchase or command.
Here, Smith is writing against one of the most basic tenets of mercantilism. Mercantilism conflates money with value and wealth. By re-defining value in terms of labor, Smith is re-defining how we conceive of wealth in general. Later in the work, Smith will argue that it is the conflation of gold and silver money with wealth that has led to false conclusions about international commerce.
The right of primogeniture, however, still continues to be respected; and as of all institutions it is the fittest to support the pride of family distinctions, it is still likely to endure for many centuries. In every other respect, nothing can be more contrary to the real interest of a numerous family, than a right which, in order to enrich one, beggars all the rest of the children.
Over the course of the work, Smith gives a scathing criticism of the law of primogeniture, characterizing it as an aberration that has maintained the pride of a few over productivity and efficiency that might be enjoyed by many. Not only do these laws “make beggars” of all but the first-born, they provide the basis for an economic system that supports unproductive, menial labor.
The experience of all ages and nations, I believe, demonstrates that the work done by slaves, though it appears to cost only their maintenance, is in the end the dearest of any. A person who can acquire no property can have no other interest but to eat as much and to labor as little as possible. Whatever work he does beyond what is sufficient to purchase his own maintenance, can be squeezed out of him by violence only, and not by any interest of his own.
Smith criticizes slavery not on moral grounds, but on economic ones. Writing at a time when slavery was employed in many of the colonies to provide Europe with a plethora of cash crops (tobacco, sugar, cotton), Smith's criticism is perhaps more biting than a moral criticism might be because it attacks what was seen as the most compelling justification for slavery—cheap labor. Smith's broader argument is that people are most motivated to perform well when they themselves are able to enjoy the fruits of their labor. All but the most basic forms of regulation—from politicians imposing tariffs to slaveowners robbing people of their freedom—undermine productivity by complicating or destroying the ability of those who work to enjoy what they have produced.
In the progress of the division of labor, the employment of the far greater part of those who live by labor, that is, of the great body of the people, comes to be confined to a few very simple operations; frequently to one or two. But the understandings of the greater part of men are necessarily formed by their ordinary employments. The man whose whole life is spent in performing a few simple operations, of which the effects, too, are perhaps always the same, or very nearly the same, has no occasion to exert his understanding, or to exercise his invention, in finding out expedients for removing difficulties which never occur. He naturally loses, therefore, the habit of such exertion, and generally becomes as stupid and ignorant as it is possible for a human creature to become. The torpor of his mind renders him not only incapable of relishing or bearing a part in any rational conversation, but of conceiving any generous, noble, or tender sentiment, and consequently of forming any just judgment concerning many even of the ordinary duties of private life.
The context of this quote is Smith's larger argument for making education a public good. This quote is significant, however, because it speaks to the phenomenon of alienation, whereby laborers find themselves ever more alienated from the products of their labor. This process dehumanizes the person over time, likening them to a machine and reducing them to the repetitive motions of their labor. Many Marxist critics have discussed this theme, lamenting the idea that, as the process of industrialization continues, laborer's relationship to the world itself is mediated through the capitalist system that employs them. While Smith's comments do not go as far as the Marxist critiques will in centuries to come, his observation that the division of labor, for all its efficiency, has negative effects on the human psyche, are extremely insightful for the period in which he was writing.
According to the system of natural liberty, the sovereign has only three duties to attend to; three duties of great importance, indeed, but plain and intelligible to common understandings: first, the duty of protecting the society from the violence and invasion of other independent societies; secondly, the duty of protecting, as far as possible, every member of the society from the injustice or oppression of every other member of it, or the duty of establishing an exact administration of justice; and, thirdly, the duty of erecting and maintaining certain public works, and certain public institutions, which it can never be for the interest of any individual, or small number of individuals to erect and maintain; because the profit could never repay the expense to any individual, or small number of individuals, though it may frequently do much more than repay it to a great society.
Above, Smith describes his view of the duties of the sovereign. His work shows that, while the duties of the sovereign include these three important charges, the power of the sovereign must also be limited to these three duties. Any regulation of the market, any establishment of a special relationship to certain social classes or social factions, any prohibition placed on what may or may not be traded, all would disrupt the natural balance of the market and hinder efficiency and production. When the government oversteps these three duties, it actively harms its people. Contemporary economic liberals share Smith's viewpoint that government power must necessarily be extremely limited, lest it do more harm than good.
Though the state was to derive no advantage from the instruction of the inferior ranks of people, it would still deserve its attention that they should not be altogether uninstructed. The state, however, derives no inconsiderable advantage from their instruction. The more they are instructed, the less liable they are to the delusions of enthusiasm and superstition, which, among ignorant nations frequently occasion the most dreadful disorders. An instructed and intelligent people, besides, are always more decent and orderly than an ignorant and stupid one. They feel themselves, each individually, more respectable, and more likely to obtain the respect of their lawful superiors, and they are, therefore, more disposed to respect those superiors. They are more disposed to examine, and more capable of seeing through, the interested complaints of faction and sedition; and they are, upon that account, less apt to be misled into any wanton or unnecessary opposition to the measures of government.
Here, Smith explains why the state should be interested in educating its lower classes, who will not, it is strongly suggested, go on to “use” their education directly, since they will live their lives as laborers. He suggests, contrary to what might be expected, that an educated people is less likely to be disruptive to the government. A people that is reasonably well-educated will be less easily persuaded by “factions” (e.g., unions or extremist political parties) than a less-educated one, and pose less political threat. On the other hand, this viewpoint seems to suggest that a well-educated people will also hold its government to certain expectations. It is only reasonable for a government to educate its people if the government concerned is reasonably democratic. Because Smith is making policy recommendations to Great Britain, it is just such a government that he has in mind.
The Wealth of Nations Questions and Answers
The Question and Answer section for The Wealth of Nations is a great
resource to ask questions, find answers, and discuss the novel.