The great Adam Smith was born in early June 1723. I won’t waste time figuring out what day because it doesn’t really matter.
To commemorate Smith’s birthday, Raison magazine asked several people to donate their favorite quotes of Smith and comment on them. I like a lot of choices. Among my favorites are those noted by Dan Hannan, Russ Roberts and Don Boudreaux.
Here are four of my other favorites:
No one has ever seen an animal by its natural gestures and cries signify to another, this is mine, that yours; I am willing to give this for that. When an animal wants to obtain something either from a man or from another animal, it has no other means of persuasion than to win the favor of those whose service it requires. A fawn puppy on its mother, and a spaniel strives by a thousand attractions to attract the attention of its master who is at dinner, when it wants to be fed by him. A man sometimes uses the same arts with his brothers, and when he has no other way of inducing them to act according to his inclinations, strives by all his servile and flattering attentions to obtain their benevolence. However, he does not have time to do so on every occasion. In civilized society, he needs the cooperation and assistance of great multitudes at all times, while his whole life is barely enough to win the friendship of a few people. In almost all other races of animals, each individual, when fully grown, is entirely independent and, in its natural state, does not need the assistance of any other living creature. But man almost constantly needs the help of his brothers, and it is in vain that he expects it from their benevolence alone. He will have a better chance of winning if he can turn their self-esteem in his favor and show them that it is in their interest to do for him what he requires of them. Whoever offers another a bargain, offers to do so. Give me what I want, and you will have what you want, that is the meaning of each of these offers; and it is thus that we obtain from each other the greater part of the good offices which we need. It is not from the benevolence of the butcher, the brewer or the baker that we expect our dinner, but from their concern for their own interest. We address ourselves, not to their humanity, but to their self-esteem, and never speak to them of our own necessities, but of their advantages.
The madness of the empire:
Founding a great empire for the sole purpose of building up a people of customers may at first glance seem like a project specific to a nation of shopkeepers. It is, however, a project quite unsuitable for a nation of shopkeepers; but extremely suited to a nation whose government is influenced by traders. Such statesmen, and such statesmen only, are capable of imagining that they will find some advantage in using the blood and the treasure of their fellow-citizens to found and maintain such an empire. Say to a shopkeeper: Buy me a good property, and I will always buy my clothes in your shop, even if I have to pay a little more than what I can get in other shops; and you will not find him very eager to accept your proposal.
The second sentence of the quote above is one of my favorite pithy Smith statements of all time. It reads as if it could have been written last week.
Smith’s first cost/benefit analysis of the empire:
The maintenance of this monopoly has hitherto been the principal, or more exactly perhaps the only end and the only object of the domination which Great Britain assumes over her colonies. In exclusive commerce, it is supposed, consists the great advantage of the provinces, which have never yet furnished either revenues or military forces for the maintenance of the civil government or the defense of the mother country. Monopoly is the chief badge of their dependence, and it is the only fruit which has hitherto been reaped from this dependence. Whatever expenditure Britain has thus far expended to maintain this dependence has actually been expended to support this monopoly. The expense of the ordinary establishment of peace in the colonies amounted, before the beginning of the present disturbances, to the pay of twenty regiments of infantry; at the expense of the artillery, stores and extraordinary provisions with which it was
necessary to supply them; and at the expense of a very considerable naval force, constantly maintained, in order to guard, against the contraband vessels of other nations, the immense coast of North America and that of our Antilles islands. The whole expense of this establishment of peace was a charge upon the revenue of Great Britain, and was, at the same time, the smallest part of what the domination of the colonies cost the mother country. If we wish to know the amount at all, we must add to the annual expense of this establishment of peace the interest of the sums which, in consequence of considering her colonies as provinces subject to her dominion, Great Britain has, on different occasions , disposed in their defense. To this must be added, in particular, all the expense of the last war, and a great part of that of the war which preceded it.
The last war was quite a colony quarrel, and all the expense of it, in whatever part of the world it may have taken place, whether in Germany or the East Indies, must justly be imputed on behalf of the colonies. It amounted to more than ninety millions of pounds sterling, including not only the new debt which was contracted, but the two shillings of the supplementary landed pound, and the sums which were each year borrowed from the Treasury. amortization. The Spanish War, which began in 1739, was primarily a colonial dispute. Its main object was to prevent the search for colony ships which were carrying on a contraband trade with the Spanish Main. All of this expense is, in effect, a bounty that has been given to support a monopoly. The supposed object was to encourage manufactures and to increase the commerce of Great Britain. But its real effect has been to raise the rate of mercantile profit, and to enable our merchants to turn into a branch of commerce, the returns of which are slower and more distant than those of most other trades, a greater proportion of their capital than they otherwise would have; two events that, if a bounty could have prevented, it might have been very useful to give such a bounty.
Under the current system of management, Great Britain therefore draws only losses from the domination it assumes over its colonies.
Smith’s prediction on the outcome of the Revolutionary War and the future of the United States:
Unless one stumbles upon this method or another, and there seems to be none more evident than this, of preserving the importance and satisfying the ambition of the leading men of America, it is unlikely that they will ever voluntarily submit to us. ; and we must consider that the blood that must be shed to force them to do so is, down to the smallest drop, the blood either of those who are, or of those whom we want to have for our fellow citizens. There are many weaklings who flatter themselves that, as things stand, our colonies will be easily conquered by force alone. The persons who now govern the resolutions of what they call their continental congress feel in themselves at this moment a degree of importance which, perhaps, the greatest subjects of Europe hardly feel. From shopkeepers, traders, and lawyers, they have become statesmen and legislators, and are employed in inventing a new form of government for an extended empire, which they flatter themselves will become, and which, indeed, seems very likely to become one of the greatest and most formidable that has ever existed in the world.
But hey, what did he know?