Ideas - The famously polarizing father of capitalism

Episode Date: June 5, 2025

<p>The 18th-century philosopher Adam Smith is often called “the father of economics,” and sometimes “the father of capitalism.”<em> IDEAS</em> contributor Matthew Lazin-Ryder examines how Smith’s name has been used and abused to both defend and attack free-market economics since his death.</p>

This is a CBC Podcast. I'm Nala Ayed. Welcome to Ideas. In the United States in the mid-80s, to prove your credentials as an intellectual member of the Republican Party, you'd wear a certain kind of patterned tie. The tie came in many colors. Burgundy was cool, navy blue was a nice choice, and if you were really devoted you could even get special pillows made from the same fabric. But what made the tie special was

not the color, it was the image on the tie that mattered of a Scottish philosopher named Adam Smith. of a Scottish philosopher named Adam Smith. Smith is best known today as the author of The Wealth of Nations, which is often called the first work of modern economics and Smith the first economist. Smith not only tends to be seen today as an economist, but indeed as a particular type of economist who is wedded to a particular ideological vision of how things are and how they ought to be. Smith's name carries a lot of weight and his name adorns various organizations, societies, and institutes.

The principles that explain how it is that an automobile operates are no different from the principles that explain how a horse and buggy operated or how a bow and arrow operated. One of the 20th century's greatest evangelists of Adam Smith was the free market economist Milton Friedman. The principles that Adam Smith enunciated are every bit as valid today as they were then. But Friedman certainly wasn't the first to claim Adam Smith as an intellectual father. I was recently giving a talk and an economist came out to me and was like, well, you know,

isn't like the most common thing about Adam Smith that like nobody reads him, but everybody just quotes him? And everybody laughed. And I was like, yeah. And actually there's like a big story behind that. But before he was cast as a timeless economist, Adam Smith was a workaday philosophy teacher, less concerned with the source of the wealth of nations and more with the origins of good and evil, the meaning of right and wrong, and the genesis of morality. Perennial questions of human nature and morality and what's right and wrong and just and what makes a free society or a happy society. And that is what Smith would have wanted to be remembered for.

CBC producer Matthew Lazen Rider brings us this documentary on the battle over Adam Smith's legacy. Have you remembered nothing? Recall the lessons of Adam Smith, the father of modern economics. In competition, individual ambition serves the common good. Exactly. Every man for himself, gentlemen. Adam Smith?

What's wrong with him? Careful. Careful. That's a scene from the 2001 film A Beautiful Mind. In it, a group of fratish college boys apply the lessons of Adam Smith to the art of picking up girls. One problem with that scene though is that Smith never actually said individual ambition serves the common good, at least not in anything he wrote down.

But he is often called the father of something. Yeah, the most common version of Adam Smith is that he's the father of economics. And there's something just very simple and benign about that. You know, he's the father of economics. Glory Liu is a postdoctoral research fellow at the political theory project at Brown University. The slightly more politically charged version of that is Smith is the father of capitalism and defender of free markets as the only and the best way to solve a variety of complex social, political, and economic problems. Glory's research involves not just who was Adam Smith, but how Adam Smith has

been used over time, how different generations have reinterpreted the writings of Adam Smith and various people who have deployed Smith to fight their ideological battles. KS – I think it's really important to be humble about a text and what we say we can know about it for sure. And I think understanding why a text becomes so famous and why its ideas become so powerful, we gain a richer understanding of that when we look at the text through the eyes of its past readers. So that's a big thing for me. As an intellectual historian, we truly try to reconstruct their worlds and see through their eyes and kind of think through their minds.

I think that gives us access on why certain kinds of ideas become so powerful and why they fade from view. Throughout the afterlife of Adam Smith's ideas, especially in this country, those views are somehow timeless and they transcend historical contexts. And I think it really matters that we get an understanding of Smith in his own time right before we decide for ourselves our Smith's questions and are Smith's answers the same as our questions to problems that we're facing today? Trevor Burrus questions like …

Lauren Henry Questions like … Lauren Henry … is capitalism fundamentally a moral system? Does it require steep inequality? And what are the problems with inequality? What are the advantages and disadvantages of open borders for trade? These are really hard questions and they've had different versions appear over time since the time Smith wrote. And I think looking at how people have answered those questions and brought Smith into the conversation can be really illuminating.

Smith was born in 1723 in Kirkcaldy, a seaside town on the east coast of Scotland. His father was a customs agent who died before he was born and he was raised only by his mother. An 1895 biography describes an unusual incident when he was a small child. He was playing in the yard of his uncle's house when a passing gang of vagabonds abducted him taking him into the forest. His uncle rounded up a posse, rode out into the forest, and brought back young Smith. Whether being kidnapped by vagrants had any lasting impact on his economic views is anyone's guess. But the biographer, a man named John Ray, goes on to speculate that it was the town itself, Kirkcaldy, that gave Smith a unique insight into the workings of

a modern economy. A small town like Kirkcaldy is a good observatory for beginning one's knowledge of the world. It has more sorts and conditions of men to exhibit than a rural district can furnish, and it exhibits each more completely in all their ways, pursuits, troubles, and characters that can possibly be done in a city. Smith, who, spite of his absence of mind, was always an excellent observer, would grow up in the knowledge of all, about everybody in that little place, from the great lady of the town to its poor colliers and salters, who were still bondsmen.

Kirkcaldy too had its shippers trading with the Baltic, its customs officers, with many a good smuggling story. And it had a nailery or two, which Smith is said to have been fond of visiting as a boy, and to have required in them his first rough idea of the value of division of labor. So he lived basically a boring scholarly life. Dennis Rasmussen is an associate professor of political science at Tufts University, and the author of the recent book The Infidel and the Professor, David Hume, Adam Smith and the friendship

that shaped modern thought. He went to excellent schools. He went to the University of Glasgow as a college student. After finishing at Glasgow, he went to Oxford for six years on a kind of fellowship where he did not learn anything from his professors. He found Oxford to be totally useless and the professors had given up, he said, even the pretense of teaching, but he immersed himself in self-study, after which he became a professor at the University of Glasgow for 12 years. He was a professor, but not in economics. Well, he was not a professor of economics because there's no such thing as a professor

of economics at the time. Economics didn't yet exist as a separate discipline. He was a professor of moral philosophy, was his title for most of his career. He would have described himself either as a philosopher or maybe more likely as a man of letters to use an 18th century term. The 18th century was a period of major social upheaval. Industrialization, urbanization, wars, a couple of revolutions, even more revolts, all to the new and energetic sounds of people like Arne and Baccarini, Mozart, Vivaldi, and a

whole lot of guys named Bach. And Scotland, of all places, was the place to be. The real dominant feature of his time in 18th century Scotland was the onset of what we now know as the Scottish Enlightenment, this real intellectual cultural flourishing that happened in what had previously been a pretty notoriously backward place, synonymous with poverty and barbarism. And over the course of Smith's lifetime, there's this economic flourishing, but along with it a cultural intellectual flourishing to the point where by the middle of the century no less a figure

than Voltaire, a bit ruefully said, is to Scotland of all places that we look for our idea of civilization. In 1759, he published the book that put him on the map. It was not The Wealth of Nations, by far his most famous book today. The book was called The Theory of Moral Sentiments. Right. So The Theory of Moral Sentiments was his first book, was published, the first edition came out in 1759. If his contemporaries are to be believed, he always believed this to be his better, more important work, despite the fact that The Wealth of Nations eventually became so much more famous. The Theory of Moral Sentiments was the book that really

kind of made his name. He became famous on the back of this book and The Wealth of Nations came much later when he was 52 years old So this was the the work that he was known for in his lifetime much more than The Wealth of Nations Which came toward the end of his life as a moral philosopher? He sought to ask fundamental questions about human nature how we're made what we value What is good why we think it's good? Ryan Hanley is a professor of political science at Boston College. He is also the author of several books on Smith, the most recent being Our Great Purpose, Adam Smith on Living a Better Life.

Well, Smith was fascinated by sympathy because it offered, among other things, a key to understanding why it is human beings act in the way that they do. The theory of moral sentiments was an attempt to figure out where our sense of morality, what is right and what is wrong, comes from. And central to Smith's theory is the human capacity for sympathy. Yeah, it's funny that today we tend to usually use the word empathy to describe what Smith is calling sympathy.

But I do like very much his use of the word sympathy and his occasional use of the word compassion. Both those words, as Smith would well have known, as well as many of his readers who had been steeped in classical languages, sympathy and compassion both end up meaning roughly the same thing. Sympathy is derived from Greek words that means roughly feeling with, so too compassion means almost precisely the same thing with a Latin derivative of feeling with. And Smith likes to use as a synonym for sympathy in English the language of fellow feeling. And that captures something very powerful that I think simple empathy doesn't.

This idea that we are simultaneously when we're with people, we're feeling things together. We might not be feeling exactly what someone else is feeling. They might not be feeling exactly what someone else is feeling. They might not be feeling exactly what we're feeling. But we are also, are all engaged in a process of fellow feeling in which we're feeling certain things together. That's a very powerful image. And I think that really is captured with the resonance of that language of fellow feeling. The theory of moral sentiments has been overshadowed by the wealth of nations, especially when it comes to economic thought. But his earlier book does paint a picture of free market exchange, not of bread and beer and beef, but of sympathy.

Peter Robinson Yeah. And this is what's really so fascinating and so revolutionary about the doctrine of sympathy as Smith described it. I mean for millennia, when people came to think about how do we know what's good? What is the source of our knowledge of what is good? They make appeals to all kinds of very familiar sources. It comes from on high, whether that comes from say revealed religion and such things as the Ten Commandments or it comes from on high. Why do we think certain things are good? Because authority figures, politicians, professors, philosophers, they've proclaimed that these things are good and they've made sure that they've been taught.

These are all ways of understanding the origins of moral norms and moral virtues as coming from authority, as coming from up on high and being delivered to people down below. Smith's doctrine of sympathy turns that on its head. For us to generate standards of what is good, this doesn't come from on high, rather, Smith thought. It comes from simply the everyday interchange of sympathies in average and ordinary life. He describes the schoolyard on which children will be playing at recess. This is what he calls the great school of sympathy.

It's where we learn how other people make their judgments, how if we do certain things, they'll react in one way versus another. I'm gonna pick a baby! It's by that process and doing it again and again and again, seeing time and again, day in and day out, how our actions, our judgments affect others. By doing that every day, iterated many times over, we come to internalize the norms of our society

without anyone ever having to stand over us and tell us, this is good, this is bad. A very young child has no self-command. When it is old enough to go to school and mix with its equals, it soon finds those equals have no time for indulgence. The child naturally wishes to gain their favor and avoid their hatred, and soon finds that the only way to do so is by moderating not only its anger but all its passions to the degree that its play fellows are likely to be pleased with, it thus enters into the great school of self-command. As Smith writes it in The Theory of Moral Sentiments, we never really graduate from the great school of self-command. We are constantly learning morality by the approval or disregard of the people we harm

or please or witnessing ourselves the consequences of harm or fortune to other people. That is to say, an ordinary, normal, well-adjusted human being, if they're walking down the street and happen to see an innocent person suffer an awful tragedy will instinctively feel this sympathetic caring for the well-being of others when they see them suffer. So sympathy is hardwired into us, if you will, both as something that we want to get from others and also something that we're naturally inclined to give to others. And Smith thought that we could explain a great deal of how we act in ordinary life through the mechanism of an exchange of sympathy between us as we act and know that we're being

watched by others and others as they act knowing that they're being watched by us. So this what philosophers sometimes call this dialectical relationship of the exchange of sympathy. Smith thought that this explains a great deal of how we come to approve of certain standards, values, virtues within our societies. Smith argues that this is not an intellectual process. It's an emotional one. We don't want people's approval because it benefits us, an act of self-interest, or as Smith called it, self-love.

We want people's approval because we're human. Whatever may be the cause of sympathy, nothing pleases us more than to observe in other men a fellow feeling with all the emotions of our own breast. Those who are fond of deducing all our sentiments from self-love think themselves that no loss to account for this pleasure and this pain. Man, say they, conscious of his own weakness and the need he has for the assistance of others, rejoices whenever he sees they share his own passions, because he is then assured of that assistance. He grieves whenever he observes the contrary,

because he is then assured of their opposition. But both the pleasure and the pain are always felt so instantaneously, and often upon such frivolous occasions, that it seems evident that neither of them can be derived from any such self-interest. On the one hand, Smith is arguing something that seems pretty Smithian. Human behavior need not comply with an authority, either religious or political. On the other, an idea less often associated with Smith, that we act based on our weird

human frailties, our emotions, that the human spirit is most at home when it's in tune with our fellow beings, not acting out of rational self-interest. The very first sentence of the theory of moral sentiments talks about how we care about others independently of our own self-interest. So the kind of caricature of Smith should be dispelled on the very first sentence that you read of his first book. It's often said that Karl Marx himself wasn't a Marxist. I think Smith wasn't a Smithian if we think of Smithian as this naive defender of greed

and laissez-faire capitalism. And I hope to show that he's a much more interesting and nuanced thinker than he's often taken to be and can even be a resource for our own thinking today, as opposed to a whipping boy if you're coming from the political left or a champion if you're coming from the libertarian right. As for the actual application of this idea, Smith has a pretty straightforward approach. People should behave as if trying to gain the empathy of an impartial spectator. So let's take the example of lying, right? So most of the time when you see somebody tell a gratuitous lie, you disapprove of it and Smith thinks an impartial spectator would also disapprove of it and so it's wrong. And so we make this

general rule as a society, lying is wrong. Now, lying might not always be wrong. A lie to save somebody's life might be perfectly reasonable and perfectly moral. And so Smith thinks an impartial spectator would see that, right? Again, they know all the circumstances involved in any given situation and they would take that into account. An impartial spectator might approve of a lie to save someone's life. And this could be contrasted with someone like Immanuel Kant, who says you have to do what's rational no matter what the circumstances. So even if somebody says, comes and knocks on your door and says, hello, I'd like to kill your mother, is she upstairs? You'd have to tell the truth, right? And Smith's notion of an impartial spectator makes room for nuances

in context and circumstance in a way that many other moral theories don't. And I think that's one of the more frankly attractive features of his moral theory. So, in many ways, Smith thought that the origins of morality emerged spontaneously, if you will. They emerged without anybody telling us one central directing being, what is good and why, but rather through the free interchange and exchange of sympathies among ordinary actors in everyday life. That was a revolutionary discovery on Smith's part and it was very powerful both for understanding central concepts and moral philosophy but also for the foundation it laid for thinking about

certain concepts not just of moral exchange but also for the foundation it laid for thinking about certain concepts, not just of moral exchange, but also economic exchange. Nat Senners Whether he was an economist or a philosopher or whatever you want to call him, Adam Smith has been dead for 229 years. Why does he matter today? Michael Snell I love it. Of all the points of contention over Smith, yes, it is undeniably true that he is dead. Why he matters today?

Well, he matters today at least for two reasons. One is that simply his name has a certain stature and like many of the great names in the history of philosophy, if you can claim him to be on your side, you have authority on your side, you have authority on your side. So he has some influence in terms of his legacy and the way in which his authority can be used to bolster a particular position. But he also has relevance because of the substance of his ideas. Smith thought broadly and he anticipated a number of the issues that are with us today. He was capacious in synthesizing a number of different issues that are with us today. He was capacious in synthesizing

a number of different strands across the social sciences and humanities in his day. So he brought together into a coherent package and indeed a far-seeing package, a system of ideas that's still very worthy of our engagement and which we can find a lot of food for thought as we work through our own issues today. Smith is remarkable because he does contain these vast multitudes that if you slice and dice him, you can get any position you want. What's really interesting is trying to put the whole together and understand how all these partial pockets of truth add up into a synthetic and reflective whole of a very

deep thinking philosopher who can't be easily pigeonholed into any one particular category. A lot of thinkers and theorists and politicians claim to take inspiration from Smith. The Wealth of Nations was on Barack Obama's 2008 essential reading list in the New York Times. Chinese Premier Wen Jiabao carried a copy of Theory of Moral Sentiments when traveling. While organizations like the Adam Smith Institute are explicitly libertarian, social critics like Noam Chomsky claim that Adam Smith would have despised free market capitalism. But this battle goes back a long way as people have tried to claim Smith for

almost as long as he's been dead. You're listening to Ideas on CBC Radio 1, Sirius XM, in Australia on RN, and on the CBC Listen app, free for both iOS and Android. I'm Nala Ayat. This episode is about the philosophy of Adam Smith, often called the father of economics. The Adam Smith of the 1700s has had a long afterlife. Here's economist Milton Friedman in his 1980 PBS series, Free to Choose, on the longevity of Adam Smith. His overall vision, his conception of how it was that without any central body planning it, millions of people could coordinate their activities

in a way that was mutually beneficial to all of them. That central concept is every bit as valid today as it was then. And indeed, we have more reason to be confident in it now than he had because we've had 200 years more experience to observe how it works. But as often as he's used to buttress arguments for free market policies, his name is also used to oppose them. It was Adam Smith, the father of free market economics, who once said, they who feed, clothe, and lodge the whole body of the people should be themselves tolerably well fed, clothe and lodge.

Smith would have called himself a philosopher, not an economist. But on both sides of the economic debate, his name carries a lot of weight. Here again is contributing producer Matthew Lason-Rydder's documentary on the battle over Adam Smith's legacy. I was once asked on an exam in high school who invented capitalism in 1776. That's Dennis Rasmussen at Tufts University. 1776 was a big year, not just for the American Declaration of Independence, but the publication of what became Adam Smith's best known work.

I think it's an overstatement to say that Smith invented capitalism. The very term capitalism has not yet been invented. But The Wealth of Nations is undoubtedly an important book. It's an important milestone in the history of thinking about the moral and social and political effects as well as course, economic effects of commerce and free trade. The Wealth of Nations is certainly one of the most famous books of all times, also not one of the most read or understood, but one of the most famous books of all time, and further solidified Smith's reputation. As I said, he thought the theory of moral sentiments was better and more important, but certainly he hoped The Wealth of Nations to have an important

practical impact as well. The book was a surprise hit. The printer at the time said it was basically number two on the bestseller list, coming second to only the pop history book, The Decline and Fall of the Roman Empire. The printer wrote that the sale of Smith's book, though not near so rapid, has been more than I could have expected from a work that requires much thought and reflection, qualities that do not abound among modern readers. The Wealth of Nations is a big sprawling book. It's hard to distill down to any one essence.

It's 900 pages long. I guess one place to start would be with the title, right? So the full title of the book is an inquiry into the nature and causes of the Wealth of Nations. So one of the big questions of the book is where does wealth come from? How do some nations become rich and others become poor? And this was a particularly striking question for someone like Smith because what he saw as the barbaric feudal age was still there in his own back door in the Scottish Highlands. Well, in Highland Scotland, there was still the clan system where you would have people loyal to their local chieftain and society revolved around these bonds of loyalty and

tradition. Whereas in Lowland Scotland, it was becoming much more advanced, progressive commercial and so people were out making money for themselves. You had merchants shipping goods across the oceans and it was a much more open, diverse commercial society that Smith saw as a great advance in terms of individual freedom and individual security and all kinds of things. And so what caused Lowland Scotland to become such a prosperous progressive place, whereas just a few hundred miles away there is a much more backward civilization? And how did this play out across the world was a big question that he and his compatriots all

wanted to answer. It seems like a big leap from thinking about the origin of morality and macroeconomics. So this has given rise to what's known in Adam Smith scholarship is the Adam Smith problem. So there's this question of are the two Smiths reconcilable? Can the Adam Smith of the theory of moral sentiments be reconciled with the Adam Smith of the wealth of nations? And in particular, people have wondered whether the emphasis on morality and especially on sympathy in the theory of moral sentiments can be reconciled with the emphasis on self-interest and the wealth of nations. Now, by this point, almost all Smith scholars say that yes, the two are fully reconcilable,

that the problem, what many have labeled as a pseudo problem, arose because people confused sympathy with benevolence and self-interest with selfishness. He in fact believed that the fact that self-interest is a reliable motive that you can rely on, as he famously puts it, the butcher, the brewer, the baker to sell you meat or beer or bread out of their self-interest keeps you from relying on their benevolence. It keeps you from being subservient or acting like a dog at a table begging for food. The way you might, for instance, if you're a serf in the feudal era and your livelihood depends on the whim, the caprice of your lord, your feudal baron. Ryan Hanley from Boston College, an author of several books on Smith, really wants people

to remember that Smith came at economics from a philosophical perspective. Right. So The Wealth of Nations is, of course, a 900 page book that many people have tried to distill into a few very succinct metaphors or concepts. When people think of the wealth of nations today, they tend to think of the concept of self-interest or laissez-faire, this idea that society is based upon the pursuit of self-interest without restriction will work to the general good. Now all of those ideas are key parts of the Wealth of Nations.

But if we were to look to see what Smith thinks is most valuable in the Wealth of Nations, why it's necessary to have an inquiry into the Wealth of Nations, we'd want to go back to the very beginning of this book. The book again is a book that's introduced on its title page as written by a professor of moral philosophy. So why is a professor of moral philosophy so invested in questions of economics? He begins to answer this from the very first pages of the book. In this lovely, what he calls it, the introduction and plan of the work, which is really only several paragraphs appended to the very beginning of the text, Smith has us think about the difference between what

he calls a so-called quote unquote savage society and a modern quote unquote civilized society. In the middle of the 1700s, an idea backed by people like philosopher Jean-Jacques Rousseau was growing in influence. It was the idea that modern society, with its streets and fences and joint stock companies, deprives humankind of some kind of noble, natural essence. That before humans came out of the forest and built cities and towns and ports, they lived in a savage yet somehow more egalitarian and considerate state.

According to Hanley, Adam Smith didn't buy it. He notes that in the savage society, the sort of society that many people in 18th century and today sort of back to the land movements sometimes romanticize. Smith makes the observation that however free and simple, think about what life would have been like then. It would have been a state in which people were frankly poor and because they were poor, they were desperate.

They might have to engage in such things as infanticide, horrific treatment of elders, the disabled, those unable to earn their keep. A savage poor society is unable to support these individuals and therefore is reduced, Smith tells us in the fourth paragraph of The Wealth of Nations, to being unable to support them and indeed to have to let them go in ways that would violate our natural humane instincts. One of the benefits of opulence therefore from the very beginning is the idea that opulent societies don't need to do this. There is a certain standard of living within opulent societies that is valuable, not because it enables the 1% to

have everything in their dreams, not because it even enables individuals to climb through the ranks and to have tremendous amounts of economic opportunity. Those aren't things that Smith necessarily disparages by any means. But at the end of the day, what makes a commercial society good in the eyes of this professor of moral philosophy is the fact that it works to generate an opulence that is of benefit to the lowest and least well off. Smith makes that clear in the introduction and plan to the work and he goes on in the very first chapter of the Wealth of Nations in which he details the concept of the division

of labor to go on to say that in fact this is precisely what justifies the program as a whole. The fact that the lowest and least members of society can be reasonably well accommodated with the necessities of life. So this is I think one of the elements of the wealth of nations and Smith's economics more generally that only very recently have scholars begun to focus on and only very recently are we starting to see any appreciation of when it comes to Smith's popular reputation. The idea that if one is a friend of capitalism, one does it because one is a friend of the

rich, that's very much challenged by Smith himself. To the degree that Smith champions something that looks like what we know as capitalism today, it's not so that the rich can get richer. It's precisely so that the poor can be less poor and live lives of decency and dignity that have eluded them in previous economic systems. Smith's books took off at home and abroad, especially in the brand new nation of the United States of America. So, you know, Smith first published The Theory of Moral Sentiments in 1759, The Wealth of

Nations in 1776. In America or, you know, the American colonies and then later the United States, those works were imported almost immediately after they're published and they're quite popular. They're very well known. Smith has a wide reputation and I think kind of the most emblematic statements about Smith's notoriety in the decades of the early republic are statements from people like Thomas Jefferson who say things like, oh, well, Smith's Wealth of Nations is the best book extant on political economy or matters of finance or it's the best book to be read.

So Smith's works, both the Theory of Moral Sentiments and the Wealth of Nations are really read as like technical resources for politicians, for statesmen who are crafting the institutions that are very young at this stage in American's history. And at this stage in American history, trade policy had already helped push the United States to war. The War of 1812 was kind of a sideshow of the Napoleonic Wars, and it had its origins in a British trade embargo on France as Napoleon was rampaging his way across Europe. The U.S.

banned all international trade, hoping to stick it to Britain, but in the end, stuck it to their own economy and dragged themselves to war. and stuck it to their own economy and dragged themselves to war. Trade policy kind of becomes front and center basically right at the conclusion of the War of 1812. And so these congressmen are trying to really suss out what the right policy is, right? Do we discriminate different nations with trade policy? Do we open our borders? How much of a tariff?

What kinds of goods? And what are the consequences of a particular trade policy? They're looking to all the resources they have available and that means they're really looking at Smith. They're looking at the works of the French economist Jean-Baptiste Sey. Later it will be David Ricardo and plenty of other thinkers down the line. But what's particularly appealing about Smith is that he already has this kind of intellectual cachet.

He has this intellectual authority as the founder of the science. And so in these long, long debates, when they're trying to identify the ideas that they think will work, sometimes they will read long extracts from the wealth of nations or they'll say, you know, I'll lay down on the authority of Adam Smith this principle and they'll say it's on the authority of Adam Smith. He invented the science of political economy. And implied in that logic is because he's the inventor of the science of political economy, this must be the right thing to do. Lew has transcripts of plenty of 1800s U.S. congressmen name dropping Smith. George

McDuffie from South Carolina's real character. He's a hardcore, you know, Smith guy. He's talking about Smith a lot. I will lay down a general principle upon the authority of Adam Smith, who, notwithstanding the sweeping condemnations that have been applied to his speculations, the capital and labour, if left to their own discretion, will speedily find employment." And then kind of on the other side, right, so those who are more in favor of, we might say protectionism, back then it was called the American system, which is to say, higher tariffs to protect American industry and to promote American manufacturers and to shield them from foreign competition.

People on the other side are also cognizant that Smith is this symbol of a type of intellectual authority that has to be dealt with. The chief object of protection is to develop the home trade and in this, it has the sanction of the apostle of free trade, Adam Smith himself. So the economist Jacob Weiner, who taught at the University of Chicago in the early 20th century, he actually said something along the lines of, you know, there's scarce an economist who can't quote from the wealth of nations and make it say whatever he wants, right? He calls it like a great Catholic book, meaning there's so much in there and you can really

make it quotable and stand for whatever you want. And that's certainly a dimension of it. But rather than saying it's just kind of like this mishmash of ideas, I think the issue is that, you know, Smith is a very complex thinker and he wrote a lot and The Wealth of Nations is a very complex book and The Theory of Moral Sentiments is also a very complex work of philosophy. So it's actually rather surprising that politically and, you know, in popular discourse, Smith appears so one-dimensional.

Smith ends up just being kind of like a partisan slogan or a partisan banner. Luke points to a tradition that is still alive and well today, using Smith's own words to argue against other people using Smith's own words. One aspect that I find particularly interesting about that kind of argument, which I often call a kind of even Smith said so logic is that when you pit Smith's identities against one another or you bring them together, it's really an argument about legitimizing a particular worldview or what have you. And that's why it's well past the time to raise a minimum wage that in real terms right

now is below where it was when Harry Truman was in office. You know, Obama famously said in 2015 he was giving an argument to raise the minimum wage. He said, It was Adam Smith, the father of free market economics, who once said, they who feed, clothe and lodge the whole body of the people should be themselves tolerably well fed, clothe and lodge. For those of you who don't speak old English, let me translate. It means if you work hard, you should make a decent living. Then you have somebody like Arthur Brooks, the president of AEI saying, well, Smith was the father of capitalism but his earlier book, The Theory of Moral Sentiments provided the

moral foundations for capitalism. What people are doing when they're invoking Smith as both an economist and a moral philosopher is to kind of maybe soften the harsher popular interpretations of capitalism as inherently unequal, degrading for the poor and to say, well, actually, our patron saint of capitalism had these egalitarian impulses or these moral impulses as well. And so those appeals to the various aspects of Smith's identity, you know, go pretty far. Smith's value is always political. But whether that political value stems from our belief that

his scientific authority as an economist is what gives him political value, right, because we need economics to guide our understanding about how a market society should operate. Or whether his value is political because he provided a way for us to think about what we owe one another in society as a moral philosopher. That's open still. And up to us, his readers, to decide. Part of the reason Smith may be so easily read from both sides of the economic divide is that he argued both sides of the economic divide is that he argued both sides equally well.

Yeah. Smith was serious in thinking that there are certain moral failures inherent in commercial societies, one of which is the simple fact that the same engine that generates universal opulence also quite frankly corrupts. And so Smith opens the Wealth of Nations in its first chapter with a famous study of the division of labor. And there he sketches out the wonderful metaphor of the pin factory and how 18 workers all working together on their separate specialized tasks can generate infinitely more product than any one worker going it alone ever possibly could. One man draws out the wire, another straights it, a third cuts it, a fourth points it, a fifth grinds it at the top for receiving the head. To make the head requires two or three distinct operations.

To put it on is a peculiar business, to whiten the pins is another. It is even a trade by itself to put them into the paper. And the important business of making a pin is, in this manner, divided into about 18 distinct operations. If they had all wrought separately and independently, they certainly could not each of them have made 20 pins in a day, but those persons working together could make among them upwards of 48,000 pins in a day. The Wealth of Nations has five books and so in the first book he introduces the concept of the division of labor, but in the fifth book he returns to the concept of the division of labor. And there he makes very clear that the division of labor for all its tremendous benefits in

generating this universal opulence also has, to put it mildly, a downside. And the downside is the specific effect that this process has on those who are engaged in the actual processes of divided specialized labor. To generate those pins, Smith insists that each of those 18 individuals in the factory have to engage in one repetitive task that they do over and over and over, thousands and tens of thousands of times a day, day in and day out. Our image of modern factory work, of course, is anticipated by Smith in these passages. But Smith, what makes him, I think, so fascinating as a philosopher who tries to see all sides

of an issue rather than just an ideologue who tells us one side of it. At the same time that he sees the benefits of that process also understands the human costs of this particular repetitive activity. In the fifth book of The Wealth of Nations, he tells us very explicitly that an individual who is compelled to engage in these sorts of activities and who does them day in and day out is likely to end up as he says, quote unquote, mentally mutilated. That is, shorn of all of those faculties that make them a human being and all of what he calls the noblest parts of human nature become eviscerated as the human being is reduced to a mere cog in the machine. The torpor of his mind renders him incapable of conceiving any generous,

noble or tender sentiment. In every improved and civilized society, this is the state into which the laboring poor must necessarily fall unless government takes some pains to prevent it. The same phenomenon of divided labor that is the great engine of our progress and opulence is also the great engine and driver of mental mutilation and corruption. The question then becomes specifically for governments, for polities, for societies. What sorts of mechanisms can we propose, invent,, so that we can continue to maximize the undeniable benefits of this specialized labor, but also at the same time mitigate some of the remarkable and even abhorrent moral costs today.

Smith's description of the negative effects of factory work may be a little overblown, but his point was that the same things that make society rich can make individuals miserable. I think the best thing that Smith can give us is an alternative to the bifurcated ways in which we tend to understand the traditional divisions of economics on the left and the right today. We're seeing in our public discourse an increased polarization in terms of two options, capitalism and socialism. These two isms are now just in terms of our electoral politics in North America emerging as rivals. What's so wonderful about Smith is that at a time in which we're retreating ever more to these more extreme places on the spectrum, Smith stands somewhere entirely separate from this very familiar bifurcation. Smith is neither simply

a libertarian capitalist nor is he simply a democratic socialist. Smith is in fact sympathetic to at least some of the inclinations on each of these sides. But what he offers is an alternative understanding of market society and its benefits as well as its shortcomings, a way of understanding the benefits of a capitalist or free market order in so far as these mechanisms that we traditionally associate with the right free markets lower taxes free trade That those can benefit when implemented specifically the aims that we often associate with the left today the creation of more just More decent more dignified more humane society one that's especially sensitive to the least well-off more humane society, one that's especially sensitive to the least well off among us. At a time in which both sides, left and right, seem unable to come together to acknowledge

the genuine concerns that potentially could bind them both together, Smith offers us an alternative way of understanding what we really want to get out of a humane, decent political order, both what the proper aims of such an order are as well as some of the mechanisms that can help us most effectively get there. Adam Smith died in 1790 in Edinburgh. His obituary in the Times newspaper claims that he died with bills unpaid and his papers a meth. It also tells a story about his state of mind in a way that makes it sound about as true

as that story of being kidnapped by passing vagrants. The article says Smith went to meet a friend and take a tour of a local tannery. It goes on, They were standing on a plank which had been laid across the tanning pit. Dr. Smith, who was talking warmly on his favorite subject, the division of labor, forgetting the precarious ground on which he stood plunged headlong into the nauseous pool. He was dragged out, stripped, and carried with blankets, and conveyed home on a sedan chair where, having recovered of the shock of this unexpected cold bath, he complained bitterly that he must leave life with all his affairs in the greatest disorder which

was considered his affectation. It's unclear if Smith really did fall into a tanning vat, or was kidnapped by vagabonds for that matter, just as it's unclear how Smith would feel about a $15 minimum wage, or tariffs on imports from China, or whether a carbon tax is the best way to tackle climate change. Smith did leave us two books, a profile pick to put on ties, and a name to argue over, quote and misquote, for 250 years or more. You were listening to Ideas and to a documentary on the battle over Adam Smith's legacy by contributing producer Matthew Lason Ryder at CBC Vancouver.

Thanks to WUWM in Milwaukee and WAER in Syracuse. If you'd like to comment on anything you've heard in this episode or in any other, you can do that on Facebook or Twitter or on our website, cbc.ca slash ideas, where of course you can always get our podcast. Lisa Ayuso is the web producer for Ideas. Technical production, Danielle Duval. Senior producer, Nicola Lukcic. The executive producer of Ideas is Greg Kelly.

And I'm Nala Ayed.