Presto!

In Book IV of The Wealth of Nations, a vantage at which you have already left the economists shivering and huddled in their sleeping bags a thousand feet below, there is a sentence that lets you peer right into Adam Smith’s world. He is talking about Cameron of Lochiel, whose decision, against his better judgment, to come out for Prince Charles Edward Stuart in 1745 won the clans for the Pretender and doomed the ancient culture of the Highlands to extinction. ‘That gentleman, whose rent never exceeded five hundred pounds a year, carried, in 1745, eight hundred of his own people into the rebellion with him.’

The ’45 seems to have spooked Adam Smith. He had just spent a miserable six years at Oxford, itself a hot or at least warmbed of Jacobitism, acquiring that English veneer that had eluded Hume and Ferguson and the other Scots literati. He may have thought as he rode north to his home town, Kirkcaldy in Fife, in August 1746, that he had made a mistake.

Let us look at Smith’s sentence a little more closely. In it there are two quantities, £500 and 800 men, which are brought into a sort of relation in the classic fashion of economics: a century earlier. Sir William Petty had valued an Englishman at £86/13/3, but then he probably would have applied a discount to Highlanders because of their violence, tartan, bagpipes, chivalry, Gaelic etc. Over the fate of the 800 men, let us not linger: actually, it doesn’t bear thinking about. With the £500, we are on firmer ground, for it was Smith’s salary for accompanying the young Duke of Buccleuch to France in 1764, the sum that gave him the independence and leisure to write The Wealth of Nations. It is the price of a useful and virtuous existence, of influence and undying fame.

John Home’s History of the Rebellion of 1745 was not published until 1802, so Smith may not have seen it (though I bet he did). It contains an account of the meeting between Lochiel and Charles Edward at MacDonald of Boradale’s. Lochiel argued long and hard to dissuade the Chevalier, but when he failed, he said: ‘I’ll share the fate of my prince; and so shall every man over whom nature or fortune have given me power.’ The quotation from The Wealth of Nations thus conceals a drama as powerful, in its way, as the exchange of armour between Glaucus and Diomede in Book VI of The Iliad, the locus classicus for the clash of money and heroism. Whatever Lochiel thought he was up to, he was not pursuing his rational self-interest within the law in the approved fashion of The Wealth of Nations. And whatever Smith thought he was up to writing that sentence, he must have seen, in the crass juxtaposition of two exact quantities, how useless money (even sterling money) is to measure human destiny.

The Wealth of Nations has impressed many people over the years, not least those that came to power in England and Scotland in 1979 and are still, more or less, with us. For in its mechanical view of human affairs, it offers, in Joan Robinson’s exasperated phrase, an ‘ideology to end all ideologies, for it [has] abolished the moral problem’. All that is necessary is to pursue self-interest and, presto!, all will be for the best. Though its view of human history is simple-minded to the point of absurdity – I, for one, have absolutely no propensity to barter, truck or exchange one thing for another – it provides a morally rational justification for people to go on doing what they are doing, which is making money. And anyway it is preferable to the alternative, which is the Camerons blown to bits by grape-shot at Culloden Moor or poniarded in the heather, Lochiel dragged off the field with his ankles shattered, his family hounded to death, his brother hanged, drawn and quartered years after the event. For all the disgust of Sir Walter Scott, the cast of thought promoted by The Wealth of Nations had, by 1820, colonised even the remotest Highlands. ‘As the country advanced in civilisation,’ the Countess of Sutherland’s factor wrote, surveying an empty Strathnaver, ‘other objects of ambition arose which money alone could procure, and the population of the Highlands remained no longer an object to be encouraged beyond that point,’ and here the Smithian jargon sounds like a sentence of death, ‘which was required for the necessary demands of labour of the estate, or to realise a money rent.’

Unlike the early Scots economists, Adam Smith had rather a dull life. Smith spent most of his life in the lap of masculine institutions – Glasgow University, Balliol, conversation clubs, the Edinburgh Customs. Of girls, apart from his mother and a maiden cousin, even a modern biographer, alas, can find no trace. He seems to have been a good man, if a little prudent, and very witty. The great drama of Adam Smith’s life, much of it admirably covered in this very learned new biography, is that it coincides with the death of an old order in Scotland: the feudal life in the Highlands, absolute monarchy and the religious view of the world. From its ruins arises an optimistic, atheistic and mechanical view of human affairs, that survived the romantic challenge of Scott (and later Marx and his epigonoi), and is the orthodoxy today.

Ross has done well to draw Smith out of the beady embrace of the economists, and present him as a philosopher of his times. The two interesting questions Ross addresses are: how, in the peculiar conditions of Protestant Lowland Scotland, Smith and his friends managed to preserve the essence of Calvinism (work, temporal reward and so on) while throwing out the incidental element (God); and how, out of a tradition of intense moral and psychological speculation that culminated in his own Theory of Moral Sentiments, Smith devised a mechanical economics drained of all psychology and ethics, or, to be vulgar, converted one great Scots vice (cant) into the other (stinge). In Smith’s case, at least, Brecht had it completely wrong: Erst kommt die Moral, dann das Fressen. Smith was clearly not quite happy with his progress, and Ross covers his later years with admirable sympathy and even tenderness.

Adam Smith was born in Kirkcaldy in 1723, the son of a formidable mother, Margaret Douglas, and a dead customs officer, also named Adam Smith. At the age of 14, he went up to Glasgow University which seems, from Ross’s description, to have been in a tumult of religious zeal, a sort of Calvinist University of Cairo; but there he came under the powerful and evidently benign influence of the professor of moral philosophy, Francis Hutcheson. Oxford, in contrast – as Gibbon was to find 12 years later – was fast asleep; but Smith turned himself into a fine scholar of classical antiquity and a thorough little Englishman, and on that basis was able to set up as a freelance lecturer in rhetoric in Edinburgh. In 1751 he was offered the professorship of logic at the University of Glasgow, and the next year was translated to Hutcheson’s old chair, where he remained happily till the patronage of the Duke of Buccleuch allowed him to travel to France and Geneva in 1764. From the university period we have a set of lecture notes, published as the Lectures on Jurisprudence, and the beautiful work that gave Smith a European reputation and won him the Buccleuch tutorship, The Theory of Moral Sentiments.

In Paris, through introductions from Hume, he was able to meet the leading French economic philosophers, notably Quesnay, Turgot and the Marquis de Mirabeau, the father of the Revolutionary orator. The illness of the Duke’s brother forced the party home, and Smith retired to his mother’s house in Kirkcaldy, working on what became The Wealth of Nations in 1776. Two years later, he was appointed a Commissioner of Customs at Edinburgh, a somewhat implausible post for an apostle of free trade, but he seems to have had no qualms about enforcing restrictions on ‘the obvious and simple system of natural liberty’ that he celebrates in Book VI of The Wealth of Nations. From this period, we have reports of an almost unbelievable absent-mindedness, the best of them spitefully collected by Walter Scott: ‘When walking in the street, Adam had a manner of talking and laughing to himself, which often attracted the notice and excited the surprise of the passengers ... that a decided lunatic, who, from his dress, appeared to be a gentleman, should be permitted to walk abroad.’ The Wealth of Nations was catching on in the South, and Smith was lionised. He appears to have had two other philosophical projects ‘on the anvil’ – evidently, according to Ross, philosophies of art and the law – but he hadn’t the strength or will to publish them, and much of his remaining vitality was expended on correcting and expanding his two published works, particularly The Theory of Moral Sentiments. The deaths in short order of his mother and of Janet Douglas, his cousin and housekeeper, seem to have broken his heart and he died, greatly mourned, in July 1790.

Dugald Stewart, the Professor of Moral Philosophy at Edinburgh and Smith’s first biographer, made an exceptionally acute observation about Smith’s thought: that all his works are presented in the form of a machine in which a connecting principle – gravity in astronomy, sympathy in ethics, money (or rather the division of labour) in economics – binds together the jumbled phenomena into a system that recommends itself to our imagination. The origin of such theorising lies less with Hume than with the spectacular achievements of the natural scientists, above all of Newton. The Newtonian systems, evidently so predictable and elegant, haunt these Lowland Scots: Law called his stupendous scheme of commercial revival and stock-jobbery in Paris his Système, while Watt actually built a steam engine in the precincts of Smith’s beloved university.

Unlike Hume, whose deathbed became a raree-show as he calmly countenanced extinction, Smith could not quite dispense with final causes. With the deployment of a highly symptomatic quotation from The Theory of Moral Sentiments, Ross suggests that Smith’s religious faith was a residue of his orphandom: ‘The very suspicion of a fatherless world must be the most melancholy of all reflections.’ The problem is that, before the economic virtues can triumph, the Christian religion must either be abolished or altered out of all recognition: that was the theme of R.H. Tawney’s great series of lectures at King’s College, London, in 1922. Smith solves his problem with a piece of commercial teleology, the so-called Invisible Hand, a deity more at home in the market than Jesus Christ. The rich, Smith writes, ‘divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants.’ One does not have to be homesick for the Age of Faith to mourn, with Tawney, the travesty of metaphysics in this deistic claptrap. None the less, Smith’s apotheosis of the market mechanism – in a similar but better known passage in The Wealth of Nations, since the economists don’t read the Theory – has exercised for weak minds and bad commercial consciences an unbreakable fascination.

The force of The Wealth of Nations lies not in its originality, for it has none. Ross gingerly suggests a ‘paradigm shift’, an idiotic phrase that always leads people into error: The Wealth of Nations is a compendium of economic and philosophical ideas that had been floating around in merchant or free-thinking circles for more than a century. (Ross is not much interested in Smith’s economic predecessors, and lists the titles of works by Law and Cantillon incorrectly.) The force of The Wealth of Nations is that, like Fra Pacioli’s treatise on double-entry bookkeeping in 1494, it reproduces commercial knowledge and practice in the vernacular, and like that great work provides them with respectability. That was the view of Dugald Stewart, and it is generally wise to follow the witness of the age. However, Ross and to an extent all the editors of the Glasgow edition regard The Wealth of Nations as scripture. That attitude in turn leads Ross greatly to exaggerate the book’s influence over the French Revolutionaries. The most influential Scotch economist in 1790 was, by a factor of about 10,000, John Law: as Ross would have seen if he’d consulted the speeches of Mirabeau fils to the National Assembly rather than Simon Schama.

I hope I can now resolve a problem that perplexed both Smith and Ross. Smith ended his encomium of Hume with these words, which echo Plato’s eulogy of Socrates in the Phaedo: ‘Upon the whole, I have always considered him, both in his lifetime and since his death, as approaching as nearly to the idea of a perfectly wise and virtuous man, as perhaps the nature of human frailty will permit.’ The sentence caused great offence in England, especially in Johnson’s circle, and provoked Smith to write: ‘A single, and, as I thought, a very harmless Sheet of paper, which I happened to write concerning the death of our late friend Mr Hume, brought upon me ten times more abuse than the very violent attack I had made upon the whole commercial system of Great Britain.’ The truth is, of course, that The Wealth of Nations is not a very violent attack on the commercial system but a collection of 17th-century truisms, and anyway the country was usually at war: free trade is not often maintained in wartime. But the election of Hume as the new Socrates – the philosopher who, in the Phaedo, gives the best ever argument for believing in the immortality of the soul – shook the world of Johnson and Boswell. It leads directly to the Economists’ Creed, courageously formulated by Keynes: in the long run, we are all dead. To the economists, nothing is real, not the soul or society or the species or nature; only desire embodied in money.

That then resolves another of Ross’s problems: why couldn’t Smith complete his other works and why did he destroy most of his papers? Dugald Stewart again understood his subject perfectly: Adam Smith didn’t want to mislead people any further. Almost the last thing he wrote – and here Ross’s great knowledge of the texts come into play – was a passage he added to the sixth edition of The Theory of Moral Sentiments. In it, he describes the admiration accorded to rich people and the contempt meted out to the poor not just as a fault, but as the ‘great and most universal cause of the corruption of moral sentiments’. I feel it would have surprised Smith to learn that, long after Newton’s system had been exploded, Law’s Système been forgotten, The Theory of Moral Sentiments gone out of print and Watt’s engine consigned to the museum, the imaginary machine known as The Wealth of Nations was not just ticking along but was worshipped, by most of humanity and all the English, as reality.