Part I yesterday explained Adam Smith’s notion that general human betterment was the unintended result of each individual following his own self-interest in the market arena of voluntary and competitive exchange. Adam Smith considered such natural order far superior to attempts by government, by those in political power, to design and impose an order and coordination in the actions of the members of society.
Echoing his earlier warnings about the social engineer, that “man of system,” Smith stated:
…By pursuing his own interest [the individual] frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good . . .
What is the specie of domestic industry which his capital can employ, and of which the produce is likely to be of the greatest value, every individual, it is evident, can, in his own situation, judge much better than any statesman or lawgiver can do for him.
Editor note: Adam Smith (1723–1790) is considered the father of modern libertarian thought, although economics and political economy have advanced significantly since the 18th century. Many of Smith’s insights have proved prescient, and it is often remarkable how today’s follies bring to mind a quotation or insight from his books, essays, or correspondence.
Richard Ebeling, a leading scholar in the Smithian tradition, penned this two-part look-back at Adam Smith, which MasterResource reposts this July 4th week.
The Wealth of Nations was published in March 1776, just a few months before the signing of the American Declaration of Independence in July of 1776. If the American Founding Fathers articulated in The Declaration of Independence the political case for individual freedom, Adam Smith presented the complementary argument for economic freedom and free enterprise.…
“We’re not just going to be waiting for legislation …. I’ve got a pen and I’ve got a phone.” (President Obama, January 14, 2014)
“The Road to Serfdom showed that government planning was not only an economic disaster, but also more tellingly a step-by-step, process-oriented political system of control and management that threatened to bring about the end of human freedom.”
Seventy years ago this month (March 1944), The Road to Serfdom by Friedrich A. Hayek was published in Great Britain. Today, this slim book continues to challenge and influence the political-economic landscape of the world.
Hayek delivered an ominous warning that political trends in the Western democracies, including America, were all in the direction of a new form of servitude that threatened the personal and economic liberty of the citizens of these countries.…