How the Scots Invented the Modern World (32 page)

This, then, becomes the mission of good government. “The wisdom of every state or commonwealth endeavors, as well as it can, to employ the force of the society to restrain those who are subject to its authority, from hurting or disturbing the happiness of one another. The rules which it establishes for this purpose, constitute the civil and criminal law of each state . . . [and] a sacred and religious regard not to hurt or disturb in any respect the happiness of our neighbor . . . constitutes the character of the perfectly innocent and just man.” Hutcheson and Hume, at last, find common ground.

For Adam Smith, our moral life, as well as our cultural life, is a matter of imagination. The richer the inventory of objects for its diversion, and the deeper our own fellow feeling, the happier we become, but also the more we can perceive happiness in others.

Our imagination, which in pain and sorrow seems to be confined and cooped up within our own persons, in times of ease and prosperity expands itself to every thing around us. We are charmed then with the beauty of that accommodation which reigns in the palaces and oeconomy of the great; and admire how every thing is adapted to promote their ease, to prevent their wants [and] to gratify their wishes. . . . We naturally confound [this ease and beauty] in our imagination with the order, the regular and harmonious movement of the system, the machine or oeconomy by means of which it is produced.

So already, in the fourth book of the
Theory of Moral Sentiments,
we meet that crucial term
economy,
at first in its narrow meaning, referring to the households of the rich and mighty, and how “the pleasures of wealth and greatness . . . strike the imagination as something grand and beautiful and noble, of which the attainment is well worth the toil and anxiety which we are so apt to bestow upon it.” But Smith also employs it in the more modern sense, as the “machine or oeconomy” by which that wealth is produced—in other words, commercial society.

And here imagination turns out to be the driving wheel of that system as well. Our imagination, the inner picture of ourselves being as rich and comfortable as a Duke of Argyll or a Bill Gates, spurs on our efforts, focusing and directing our energies toward a single purpose. “It is this
deception,
” Smith adds (with my emphasis),

which rouses and keeps in continual motion the industry of mankind. It is this which first prompted them to cultivate the ground, to build houses, to found cities and commonwealths, and to invent and improve all the sciences and arts, which ennoble and embellish human life; which have entirely changed the whole face of the globe, have turned the rude forests of nature into agreeable and fertile plains, and made the trackless and barren ocean a new fund of subsistence, and the great high road of communication to the different nations of the earth.

The rich man is the man with the most fertile imagination, in other words; his eyes really are bigger than his stomach. By devoting all his efforts and those of his employees and tenants to his land or his warehouse or factory, he ends up producing far more than he can consume himself:

The rich consume little more than the poor [after all, you can drive only one Rolls-Royce at a time] and in spite of their natural selfishness and rapacity, though they mean only their own conveniency [and] their own vain and insatiable desires, they divide with the poor the produce of all their improvements. They are led
by an invisible hand
[my emphasis] to make the same distribution of the necessarities of life, which would have been made, had the earth been divided into equal portions among all its inhabitants. . . . Thus, without intending it, without knowing it, [the rich] advance the interest of the society, and afford means to the multiplication of the species.

The
Theory of Moral Sentiments
made Smith famous. To his dying day, he thought of it as a better book than The
Wealth of Nations
—and in fact, as we can see, it contains all the seeds of that later work. It won the warm approval of Hume (although he did not change his mind about his own theories). The book also won great praise for its “solidity” and “truth” from Edmund Burke, then a rising member of parliament and author of
The Theory of the Sublime,
who wrote to Smith that “a theory like yours founded on the Nature of man, which is always the same, will last.” German intellectuals read it with fascination, particularly Immanuel Kant, who asked plaintively, “Where in Germany is the man who can write so well about the moral character?” Voltaire summed up the feelings of many French
philosophes
when he exclaimed, “We have nothing to compare with him, and I am embarrassed for my dear compatriots.”

Admiration for the book did not necessarily extend to approval of every idea in it. Some reviewers wanted to know if Smith was saying that we have no higher standard of morality than the one society imposes on us. What if society demands of us actions that are actually evil? Are we condemned to be social conformists forever? Smith replied no, “we soon learn . . . to set up in our minds a judge between ourselves and those we live with,” who weighs our actions according to an impartial standard, so that “real magnamity and conscious virtue can support itself under the disapprobation of all mankind.” But the conformity problem would not go away, and it would haunt every Enlightenment figure who treated morality as essentially a matter of social utility. Instead, it would take a renegade French musician, Jean-Jacques Rousseau, and a former Army chaplain from the Highlands, Adam Ferguson, to break that issue wide open and explore the new ethical horizons that it opened up. The result would be the birth of the Romantic movement,which proposed a different relationship between the inner self and society—one born of conflict rather than cooperation, in which our happiness seems possible only at the expense of others, and vice versa.

All this seemed a long way off, though, particularly to Smith. His most important work still lay ahead. It was the indirect result of his friendship with the eighteen-year-old Duke of Buccleuch, one of Scotland’s wealthiest aristocrats. The English politician and future Chancellor of the Exchequer Charles Townshend had suggested that Buccleuch take Smith as his tutor for his Grand Tour of Europe (Smith and Hume had given Townshend a copy of the
Theory of Moral
Sentiments
). The Grand Tour was the rite of passage of wealthy adolescent Britons in the eighteenth century. It involved visiting western European cities such as Paris, Amsterdam, Venice, and Rome to taste the artistic, social, and often sexual fruits of the culture of the Continent. It often could last a year or more. Smith, worn out by his teaching and administrative chores at Glasgow (he had become Dean of the Faculty in 1760), happily accepted the invitation, and set out with his young pupil for the Continent in February 1766.

The reader who expects the trip to have been a fiasco, with the young Buccleuch turning out to be a holy terror, a kind of aristocratic Tom Jones, is going to be disappointed. In fact, Buccleuch seems to have been a sweet, rather shy boy, not overburdened with intellect but serious enough for Smith to give him Hume’s
History of England
to read on the way. A strong bond of affection and trust developed between them, strong enough that when they returned, Buccleuch offered Smith enough money to quit teaching and to write his next big book—a sort of eighteenth-century “genius grant.” The book Smith completed in 1775 was, of course, his
Inquiry into the Nature and Causes of the Wealth of
Nations,
which appeared in print that following spring.

It was the logical follow-up to Smith’s earlier lectures on civil and natural law, but also to the themes of his moral theory: How and why do human beings learn to cooperate, and what makes for a constructive, useful life as opposed to a destructive one? Its strictly “economic” chapters, especially in Books One and Two, touched on subjects that certain French thinkers, the so-called Physiocrats, had taken up in their writings. Smith knew their work, and met several of them during his stay in Paris with Buccleuch. However, he does not seem to have taken much of what they said to heart, and he came back from his Paris visit very unimpressed (judging from their letters about Smith, the feeling was mutual). The real inspiration for his subject was his fellow Scots and the work they had done over the past three decades on the history of civil society, of how “commerce and manufactures gradually introduced order and good government, and with them, the liberty and security of individuals.” Lurking in the background of the
Wealth of Nations
are Kames, Hume, Robertson, and even Hutcheson. It is not only Adam Smith’s masterpiece. It is also the
Summa
of the Scottish Enlightenment, a summation of its exploration of the nature of human progress—and its salute to the triumph of the modern.

Starting with chapter 1, Smith explains how the business of civilization gets done, by isolating the basic principle that explains all social improvement: the division of labor. This is Smith’s term. The idea itself probably originated with David Hume, who called it “the partition of employments.” We use another, perhaps better, word for it:
specialization.

The notion itself is simple. When we concentrate our energy on one task rather than several, we increase our productivity. Instead of herding and fishing and farming for our living, as primitive man or the Highland clansman did, we just farm. The result is we grow more than enough to feed ourselves, enough in fact to sell to others. Later, instead of dividing our time between growing and then bartering or selling our produce, we decide to leave the farming to someone else and concentrate on just buying and selling. We become merchants, and soon discover we can earn far more than the farmers and peasants who sell us the fruit of their labors.

And so on, at each stage of civil society’s progress. The division of labor, Smith believed, was the inevitable rule everywhere; it occurred at every stage and in every human activity. But its role becomes particularly pronounced in commercial society. As we continue to specialize and become increasingly more productive, the fruits of our labor are no longer things we consume ourselves. They become “commodities,” literally the things that make our lives comfortable, which we buy and sell in exchange for other goods. We start to think about our labor in a new way. We look for ways to improve what we make and save time in making it, in order to sell it at market to get the things we really want. Capitalism is born, the system of economic production behind commercial society, a system whose productivity and inventiveness put all the rest in the shade.

The reason is that capitalism brings an intellectual as well as an economic change. It alters the way we think about ourselves and about others: we become buyers and sellers, customers and suppliers, who strive to improve the quality and quantity of our output, in order to gratify our needs. Eventually, Smith states, the division of labor produces people who do nothing but think about improvements: engineers such as his friends James Watt and Alexander Wilson, scientists such as Joseph Black, and those “whose trade it is not to do anything, but to observe everything”—philosophers, teachers, and professional managers of every sort.

The division of labor, in short, applies not just to physical labor, such as growing carrots or selling tobacco or making nails, but to intellectual labor as well. “Each individual becomes more expert in his own particular branch,” Smith explains, “more work is done upon the whole, and the quantity of science is considerably increased by it.” It lays the necessary foundation for technological innovation, as well as the gift of cultural refinement. Society finds space for its white-collar professionals, people who have time to do nothing but write, paint, teach, compose music, count numbers, or plead cases in court, all for the gratification of the rest of our fellow citizens.

Smith had finally defined the link between commerce and cultural progress, which the rest of the Scottish Enlightenment had written about and celebrated, but not really proved. But he also opened up a broader point, and gestured toward another, often overlooked advantage to living in a modern commercial society. As the fourth stage of human progress, it produces more, in greater quantities, than any of its predecessors. It is so productive, in fact, that it can supply the wants and needs not only of those who work, but of those who don’t. In the early drafts of
Wealth of Nations,
Smith strongly emphasized this (unfortunately, most of it did not make it to the final published version). He conceded that capitalism generates a great inequality of wealth, with a very few commanding the great bulk of commodities and a great part of the rest sharing what is left. But even so, Smith wanted to know, “in what manner shall we account for the superior affluence and abundance commonly possessed by even the lowest and most despised member of Civilized Society, compared with what the most respected and active savage can attain to.”

The answer is again division of labor, in which “so great a quantity of everything is produced, that there is enough both to gratify the slothful and oppressive profusion of the great, and at the same time abundantly to supply the wants of the artisan and the peasant.” Better to be a poor man in a rich country than a rich man in a poor one. It was a lesson in comparative advantage that Smith and his generation saw played out in the Scottish Highlands. Later on, the modern West learned it again as it watched floods of Third World emigrants gladly give up their homes in Bangladesh or Guatemala for the most menial jobs they could find in London or New York.

On this point, as on so many in the
Wealth of Nations,
Smith shared his friend Hume’s delight in irony. Commentators sometimes suggest that irony is the most characteristic attitude of the modern mind. Certainly the enlightened Scots had it in abundance. It sprang from their pursuit of intellectual detachment in observing human affairs, in noticing how our intentions and expectations so often differ from our actual performance. In Smith’s case, that detachment allowed him to see that the charity cases of commercial society’s “universal opulence” included not only the indigent and homeless at the bottom of the social scale, but the rich and famous at the top. It also led him to perceive the real significance of self-interest as a human motivation.