Share this Story : National Post Copy Link Email X Reddit Pinterest LinkedIn Tumblr

J.D. Tuccille: The one book Trump really needs to read

The Wealth of Nations insights into freedom and prosperity remain as relevant today as ever

You can save this article by registering for free here. Or sign-in if you have an account.

Monday, March 9, marks 250 years since the publication of Adam Smith’s An Inquiry into the Nature and Causes of the Wealth of Nations. National Post has asked experts and Smith admirers to reflect on the meaning of this seminal work.

Enjoy the latest local, national and international news.

Exclusive articles by Conrad Black, Barbara Kay and others. Plus, special edition NP Platformed and First Reading newsletters and virtual events.

Unlimited online access to National Post.

National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.

Daily puzzles including the New York Times Crossword.

Support local journalism.

Enjoy the latest local, national and international news.

Exclusive articles by Conrad Black, Barbara Kay and others. Plus, special edition NP Platformed and First Reading newsletters and virtual events.

Unlimited online access to National Post.

National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.

Daily puzzles including the New York Times Crossword.

Support local journalism.

Create an account or sign in to continue with your reading experience.

Access articles from across Canada with one account.

Share your thoughts and join the conversation in the comments.

Enjoy additional articles per month.

Get email updates from your favourite authors.

Create an account or sign in to continue with your reading experience.

Access articles from across Canada with one account

Share your thoughts and join the conversation in the comments

Enjoy additional articles per month

Get email updates from your favourite authors

Sign In or Create an Account

How time flies, and how little seems to change while it does so. Two hundred and fifty years ago, Adam Smith’s seminal book, An Inquiry Into the Nature and Causes of the Wealth of Nations, usually abbreviated as The Wealth of Nations, was originally published. In the first clear statement of modern economic ideas, Smith criticized the then-popular fetish that limiting imports, promoting exports, and hoarding precious metal were the keys to prosperity. Instead, he pointed out that wealth is gained by producing, buying, and selling in a state of liberty.

J.D. Tuccille: The one book Trump really needs to read Back to video

As influential as Smith’s book has been, its insights remain relevant in a world where politicians like U.S. President Donald Trump insist that unfettered trade is a sucker’s game.

This newsletter tackles hot topics with boldness, verve and wit. (Subscriber-exclusive edition on Fridays)

There was an error, please provide a valid email address.

By signing up you consent to receive the above newsletter from Postmedia Network Inc.

A welcome email is on its way. If you don't see it, please check your junk folder.

The next issue of Platformed will soon be in your inbox.

We encountered an issue signing you up. Please try again

Interested in more newsletters? Browse here.

Smith is often referred to as the father of capitalism, but that’s not really accurate. Smith didn’t develop a framework for a human-designed economic system; instead, he described how people benefit from conducting their economic relations with a minimum of interference. It’s fair to say that at the core of his economic observations is freedom rather than capital.

“The statesman, who should attempt to direct private people in what manner they ought to employ their capitals, would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it,” Smith wrote in his 1776 book.

Leaving people free to pursue their own priorities keeps the state within its proper limits, Smith emphasized in an insight at the core of classical liberalism and modern libertarianism. It also allows people to flourish without relying on noble sentiments or altruism as buyers, sellers, and people entering into voluntary transactions bargain their way to mutual benefit.

“By pursuing his own interest, he frequently promotes that of the society more effectually than when he really intends to promote it,” Smith wrote of the consequences of people’s self-interested dealing. “I have never known much good done by those who affected to trade for the public good.”

J.D. Tuccille: America running headlong into a debt crisis

J.D. Tuccille: Trump has a case for war. He should have made it to Congress

Advertisement 1Story continues belowThis advertisement has not loaded yet, but your article continues below.document.addEventListener(`DOMContentLoaded`,function(){let template=document.getElementById(`oop-ad-template`);if(template&&!template.dataset.adInjected){let clone=template.content.cloneNode(!0);template.replaceWith(clone),template.parentElement&&(template.parentElement.dataset.adInjected=`true`)}});

That is because, Smith noted, each person “intends only his own gain; and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.” Good for society as a whole results from voluntary exchanges negotiated among individuals seeking the greatest benefit for themselves. No purity of spirit is required when the common good is achieved by individuals working for their own profit.

Smith’s ideas, therefore, stand as a permanent rebuke to people who favour state intervention in and guidance of economic activities. That means all the various flavours of socialists, of course, who favour government control over individual action and disparage the value of private property. But he also stood in opposition to nationalist politicians who saw trade as a team sport with winners and losers. Unfortunately, that mindset has returned and once again threatens the world’s prosperity.

How B.C.'s conflicting Indigenous land claims are a problem 150 years in the making Canada

How B.C.'s conflicting Indigenous land claims are a problem 150 years in the making

When Canada's 'tolerance and diversity' clashes with Sikh 'radicalism' NP Comment

When Canada's 'tolerance and diversity' clashes with Sikh 'radicalism'

Advertisement 2Story continues belowThis advertisement has not loaded yet, but your article continues below.document.addEventListener(`DOMContentLoaded`,function(){let template=document.getElementById(`oop-ad-template`);if(template&&!template.dataset.adInjected){let clone=template.content.cloneNode(!0);template.replaceWith(clone),template.parentElement&&(template.parentElement.dataset.adInjected=`true`)}});

IED tossed near anti-Islam protesters outside New York City's mayoral residence: police World

IED tossed near anti-Islam protesters outside New York City's mayoral residence: police

Letters: War in Iran, property worries in B.C., and other concerns for Canadians NP Comment

Letters: War in Iran, property worries in B.C., and other concerns for Canadians

Carney calls April 13 byelections in three ridings Canadian Politics

Carney calls April 13 byelections in three ridings

In April of last year, the Trump administration published a trade report huffing that “An America First Trade Policy will … reduce our destructive trade imbalance” with tariffs and other trade restrictions on its way to making the United States more prosperous. That’s the sort of thinking that Smith, 250 years ago, dismissed as untrue and damaging.

“Nothing, however, can be more absurd than this whole doctrine of the balance of trade,” he warned. “When two places trade with one another, this doctrine supposes that, if the balance be even, neither of them either loses or gains; but if it leans in any degree to one side, that one of them loses, and the other gains, in proportion to its declension from the exact equilibrium. Both suppositions are false.” In fact, he pointed out, “trade which, without force or constraint, is naturally and regularly carried on between any two places, is always advantageous, though not always equally so, to both.”

That observation remains relevant centuries later. In 1978, Nobel Prize-winning economist Milton Friedman (who often wore neckties featuring Adam Smith’s profile) told a lecture audience at Kansas State University: “The gain from foreign trade is what we import. What we export is the cost of getting those imports. The proper objective for a nation, as Adam Smith put it, is to arrange things so we get as large a volume of imports as possible for as small a volume of exports as possible.”

The way to do that, Smith and Friedman believed, is to encourage voluntary exchange so that people can cut deals they consider advantageous and reject those that don’t meet their terms. As Friedman added, “we could set a great example to the world and benefit the world as a whole, contribute not only to prosperity but to peace around the world, by moving in the direction of free trade.”

As Friedman’s comment about peace suggests, Smith’s observations weren’t just economic in nature. The Scottish thinker served for many years as a professor of moral philosophy at the University of Glasgow. His writings addressed the whole range of human conduct.

“Smith had a radical, fresh understanding of how human societies actually work,” the London, UK-based Adam Smith Institute notes in a brief biography about the source of its inspiration. “He realised that social harmony would emerge naturally as human beings struggled to find ways to live and work with each other. Freedom and self-interest need not produce chaos, but — as if guided by an “invisible hand” — order and concord.”

Smith’s ideas percolated in an environment of rare intellectual ferment. Smith was close friends with the classical liberal philosopher, David Hume. Their relationship is wonderfully captured by Dennis C. Rasmussen’s The Infidel and the Professor: David Hume, Adam Smith, and the Friendship That Shaped Modern Thought, published in 2017. The book is worth reading precisely because both men’s ideas remain so relevant and needed a quarter-millennium later (Hume died in 1776 and Smith in 1790).

Two hundred and fifty years after it first appeared in print, Adam Smith’s The Wealth of Nations deserves celebration for its insight into freedom and the necessary conditions for prosperity. But it also should be read because its lessons have yet to fully penetrate the thick skulls of those who govern us.

Share this Story : National Post Copy Link Email X Reddit Pinterest LinkedIn Tumblr

Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information.

Is this award-winning mattress and bed frame worth it? I tested both for 60+ nights I put the Endy Hybrid Mattress and Curve Bed through their paces 1 hour ago Sleep

Is this award-winning mattress and bed frame worth it? I tested both for 60+ nights

I put the Endy Hybrid Mattress and Curve Bed through their paces

Our editors tested Reformation's most popular spring shoes: Here's the verdict The Inez comes in several chic styles for the season 21 hours ago Fashion

Our editors tested Reformation's most popular spring shoes: Here's the verdict

The Inez comes in several chic styles for the season

Lose an hour, not your sleep: The products that actually help Tips on maintaining your sleep schedule during time changes 2 days ago Sleep

Lose an hour, not your sleep: The products that actually help

Tips on maintaining your sleep schedule during time changes

Advertisement 3Story continues belowThis advertisement has not loaded yet, but your article continues below.document.addEventListener(`DOMContentLoaded`,function(){let template=document.getElementById(`oop-ad-template`);if(template&&!template.dataset.adInjected){let clone=template.content.cloneNode(!0);template.replaceWith(clone),template.parentElement&&(template.parentElement.dataset.adInjected=`true`)}});

Top carpet cleaners that can handle tough messes Whether you have kids or pets, find options for every use and budget 2 days ago Home Living

Top carpet cleaners that can handle tough messes

Whether you have kids or pets, find options for every use and budget

The best online deals in the Canadian retail space right now Cozy Earth, Saje and Explore Hardware, to name a few 3 days ago Deals

The best online deals in the Canadian retail space right now

Cozy Earth, Saje and Explore Hardware, to name a few

© National Post