Adam Smith

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Adam Smith, "father of capitalism" and author of The Wealth Of Nations, was a liberal, not a libertarian: see his The Theory of Moral Sentiments. He supported an enormous range of government functions that libertarians generally do not.

Here is a list from Jacob Viner:

  • The Navigation Acts, blessed by Smith under the assertion that 'defence, however, is of much more importance than opulence'; (WN464)
  • Sterling marks on plate and stamps upon linen and woollen cloth (WN138-9)
  • Enforcement of contracts by a system of justice; (WN720)
  • Wages to be paid in money, not goods;
  • Regulations of paper money in banking; (WN437)
  • Obligations to build party walls to prevent the spread of fire; (WN324)
  • Premiums and other encouragements to advance the linen and woollen industries'; (TMS185)
  • 'Police', or preservation of the 'cleanliness of roads, streets, and to prevent the bad effects of corruption and putrifying substances';
  • ensuring the 'cheapness or plenty [of provisions]'; (LJ6; 331)
  • patrols by town guards, fire fighters and of other hazardous accidents; (LJ331-2)
  • Erecting and maintaining certain public works and public institutions intended to facilitate commerce (roads, bridges, canals and harbours); (WN723)
  • Coinage and the Mint; (WN478; 1724)
  • Post office; (WN724)
  • Regulation of institutions, such as company structures (joint stock companies; co-partneries, regulated companies); (WN731-58)
  • Temporary monopolies, including copyright, patents, of fixed duration; (WN754)
  • Education of youth ('village schools', curriculum design); (WN758-89)
  • Education of people of all ages (tythes or land tax) (WN788);
  • Encouragement of 'the frequency and gaiety of publick diversions'; (WN796)
  • The prevention of 'leprosy or any other loathsome and offensive disease' from spreading among the population; (WN787-88)
  • Encouragement of martial exercises; (WN786)
  • Registration of mortgages for land, houses, and boats over two tons; (WN861, 863)
  • Government restrictions on interest for borrowing (usury laws) to overcome investor 'stupidity'; (WN356-7)
  • Laws against banks issuing low-denomination promissory notes; (WN324)
  • Natural liberty may be breached if individuals 'endanger the security of the whole society'; (WN324)
  • Limiting 'free exportation of corn' only 'in cases of the most urgent necessity' ('dearth' turning into 'famine'); (WN539)
  • Moderate export taxes on wool exports for government revenue; (WN 879)

Some more include:

  • Progressive taxation.
  • Denunciation of landlords as non-productive.


Adam Smith Hates Bitcoin [More...]
"[...] people think it’s smart, nay cutting-edge, to create a sort of virtual currency whose creation requires wasting real resources in a way Adam Smith considered foolish and outmoded in 1776."
Adam Smith on how to make the working class happier and more productive: pay them more [More...]
That famous socialist Adam Smith says: "If masters would always listen to the dictates of reason and humanity, they have frequently occasion rather to moderate, than to animate the application of many of their workmen."
Adam Smith on the Benefits of Public Education [More...]
All the way back in 1776, long before public education was widespread, Adam Smith made the case in The Wealth of Nations for the government to provide public education for everyone, partly on the grounds that it would benefit the economy to have more educated workers, but also partly on the grounds that in a political context, educated people are "less liable ... to the delusions of enthusiasm and superstition" and "less apt to be misled" in a political context.
Adam Smith's views in 1776 on the progressive burden of taxation [More...]
Adam Smith’s ideas about the justification for progressive rather than merely proportionate taxation.
Class War and the Lessons of History [More...]
David Brin points out that class war has always been occurring according to Adam Smith, and that the founders of the US were levelers, creating institutions that broke up concentrations of wealth. Progressive leveling can work again.
Debt and the Decay of the Myth of Liberal Individualism [More...]
We are not, in any way, “men who owe no obligation to one another”. Our entire social system is founded on obligation and interconnectedness. This was likely true even in Smith’s time, but his genius was to have hidden it from view and in doing so to construct the founding myth of liberal individualism as it exists in modern times.
Existential Comics 337: Scooby-Doo and the Case of the Missing Landlords [More...]
"I just want to move capital from the landlords, who contribute nothing, into the hands of those who actually produce. Is that so bad?"
It’s Excessive Occupational Licensing, Charlie Brown! [More...]
Combined with the comments, this is a very useful discussion of the cherry-picked example of hair braiding being regulated under cosmetology. Including a description of Adam Smith's endorsement of occupational licensing.
Liberals, you must reclaim Adam Smith [More...]
David Brin denounces modern libertarians and their selective citation of Adam Smith. Brin calls for progressive reforms to bring capitalism back to Smithian competition.
Shrugging off Atlas [More...]
Brad DeLong identifies Nicholas Eberstadt's big lie on the second page of "A Nation of Takers: America’s Entitlement Epidemic". A scary "9.5 percent per annum for fifty straight years" is actually 1.2 percent.
Smith's word [More...]
Smithian soundbites misrepresent the larger picture he portrayed in his major works. "[...] evidence suggests that Smith had a more complex view of human action than most people give him credit for."
The Wealth of Nations (book, online)


We are not, in any way, “men who owe no obligation to one another”. Our entire social system is founded on obligation and interconnectedness. This was likely true even in Smith’s time, but his genius was to have hidden it from view and in doing so to construct the founding myth of liberal individualism as it exists in modern times.
Philip Pilkington, "Debt and the Decay of the Myth of Liberal Individualism"
It really looks from the anthropologists that Adam Smith was wrong--that we are not animals that like to "truck, barter, and exchange" with strangers but rather gift-exchange pack animals--that we manufacture social solidarity by gift networks, and those who give the most valuable gifts acquire status hereby.
Brad DeLong, "Economic Anthropology: David Graeber Meets the Noise Machine..."
We may observe that the government in a civilized country is much more expensive than in a barbarous one; and when we say that one government is more expensive than another, it is the same as if we said that the one country is farther advanced in improvement than another. To say that the government is expensive and the people not oppressed is to say that the people are rich. There are many expenses necessary in a civilized country for which there is no occasion in one that is barbarous. Armies, fleets, fortified places, and public buildings, judges, and officers of the revenue must be supported, and if they be neglected, disorder will ensue.
Adam Smith, "Lectures on Justice, Police, Revenue and Arms (1763)"
The basic competitive-markets model dating back to Adam Smith has been modified over time by the inclusion, in rough historical order, of monopoly, externalities, scale economies, incomplete and asymmetric information, irrational behavior, and many other real world features.
Dani Rodrik, "Rescuing Economics from Neoliberalism"
And deserts—the fact that some people deserve what they have and others do not? That idea never made any sense to Adam Smith, for he saw that the overwhelming bulk of our wealth is our joint product through our collective division of labor, rather than the individual creation of some Randite John Galt, who if truly left to stand alone on his own two feet without the social division of labor would soon have his bones bleaching in some Colorado canyon.
Brad DeLong, "Shrugging off Atlas"
Civil government, so far as it is instituted for the security of property, is in reality instituted for the defence of the rich against the poor, or of those who have some property against those who have none at all.
Adam Smith, "The Wealth of Nations"
The masters, being fewer in number, can combine much more easily: and the law, besides, authorises, or at least does not prohibit, their combinations, while it prohibits those of the workmen. We have no acts of parliament against combining to lower the price of work, but many against combining to raise it. In all such disputes, the masters can hold out much longer.
Adam Smith, "The Wealth of Nations" VIII
The interest of the dealers, however, in any particular branch of trade or manufactures, is always in some respects different from, and even opposite to, that of the public. To widen the market and to narrow the competition, is always the interest of the dealers. To widen the market may frequently be agreeable enough to the interest of the public; but to narrow the competition must always be against it, and can serve only to enable the dealers, by raising their profits above what they naturally would be, to levy, for their own benefit, an absurd tax upon the rest of their fellow-citizens. The proposal of any new law or regulation of commerce which comes from this order ought always to be listened to with great precaution, and ought never to be adopted till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it.
Adam Smith, "The Wealth of Nations", last sentences in conclusion of Book 1.
We rarely hear, it has been said, of the combinations of masters, though frequently of those of workmen. But whoever imagines, upon this account, that masters rarely combine, is as ignorant of the world as of the subject. Masters are always and everywhere in a sort of tacit, but constant and uniform, combination, not to raise the wages of labour above their actual rate. To violate this combination is everywhere a most unpopular action, and a sort of reproach to a master among his neighbours and equals. We seldom, indeed, hear of this combination, because it is the usual, and, one may say, the natural state of things, which nobody ever hears of. Masters, too, sometimes enter into particular combinations to sink the wages of labour even below this rate. These are always conducted with the utmost silence and secrecy till the moment of execution; and when the workmen yield, as they sometimes do without resistance, though severely felt by them, they are never heard of by other people.
Adam Smith, "The Wealth of Nations" VIII
Our merchants and master manufacturers complain much of the bad effects of high wages in raising the price, and thereby lessening the sale of their goods, both at home and abroad. They say nothing concerning the bad effects of high profits; they are silent with regard to the pernicious effects of their own gains; they complain only of those of other people.
Adam Smith, "The Wealth of Nations" I.9, final sentences.
Workmen, on the contrary, when they are liberally paid by the piece, are very apt to overwork themselves, and to ruin their health and constitution in a few years... Almost every class of artificers is subject to some peculiar infirmity occasioned by excessive application to their peculiar species of work. .. Great labour, either of mind or body, continued for several days together is, in most men, naturally followed by a great desire of relaxation, which, if not restrained by force, or by some strong necessity, is almost irresistible... If it is not complied with, the consequences are often dangerous and sometimes fatal, and such as almost always, sooner or later, bring on the peculiar infirmity of the trade. If masters would always listen to the dictates of reason and humanity, they have frequently occasion rather to moderate, than to animate the application of many of their workmen. It will be found, I believe, in every sort of trade, that the man who works so moderately, as to be able to work constantly, not only preserves his health the longest, but, in the course of the year, executes the greatest quantity of work.
Adam Smith, "The Wealth of Nations" VIII
The pride of man makes him love to domineer, and nothing mortifies him so much as to be obliged to condescend to persuade his inferiors. Wherever the law allows it, and the nature of the work can afford it, therefore, he will generally prefer the service of slaves to that of freemen.
Adam Smith, "The Wealth of Nations" III.2.10
Whenever the legislature attempts to regulate the differences between masters and their workmen, its counsellors are always the masters. When the regulation, therefore, is in favour of the workmen, it is always just and equitable; but it is sometimes otherwise when in favour of the masters.
Adam Smith, "The Wealth of Nations" X.2