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Executive Times |
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2007 Book Reviews |
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On the
Wealth of Nations by P.J. O’Rourke |
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Rating: |
*** |
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(Recommended) |
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Click on
title or picture to buy from amazon.com |
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Lightly I confess to
not having read Adam Smith’s The Wealth
of Nations. I suspect that I’m not alone. The folks at Atlantic Monthly
Press have figured that out and started a new series of Books That Changed
the World. They commissioned familiar writers to read those works and tell
the rest of us what they say. P.J. O’Rourke’s contribution, On the
Wealth of Nations, does just that. In typical O’Rourke style, he does it
with a light and humorous touch, while never losing clarity on the key points
he’s trying to convey. Here’s an excerpt, from the beginning of Chapter 4,
“The Wealth of Nations, Book 1 How the High Price of Freedom Makes the Best
Things in Life Free,” pp. 38-43: Considering the immense orb of Adam Smith’s thinking and
his tendency to go off on tangents, The
Wealth of Nations is surprisingly well organized. Smith divided Wealth into five books. He presents
his economic ideas in books 1 and 2. Book 1 addresses production and
distribution, and book 2 concerns capital and profit. Book 3 is an economic history
of western Europe showing how various aspects of production, distribution,
capital, and profit evolved and how their evolution caused a, so to speak,
global warming in the climate of ordinary life. Book 4 is a refutation of
economic ideas other than those of Adam Smith. It includes a particularly—too
particularly—detailed attack on the mercantilists. And Book 5 is Smith’s
attempt to apply his ideas to solving problems of government. But since
problems are the only excuse for government, solving them is out of the
question. For this and other reasons, Book 5 is surprisingly disorganized. It should be noted that
Adam Smith did not create the discipline he founded. What we call economics
was invented by Francois Quesnay and the French physiocrats, whom Smith knew.
The physiocrats, however, badly overthought
the subject. Quesnay, who was Louis XV’s physician, drew an elaborate Tableau Economique, a minutely labeled, densely zigzagging
chart—part cat’s cradle, part crossword puzzle, part backgammon board. It
may have put Smith off the whole idea of graphic representation. The tableau
supposedly showed how agriculture is the source of all economic progress,
how trade and manufacture do no good for anyone, and how everything—from
wagon wheels to Meissen chamber pots—grows, in
effect, on farms. Food is the entire basis of living,
therefore agriculture must be the entire basis for getting a life. So went
the physiocrat reasoning, more or less. To Quesnay
and his fellow courtiers the motive for investigating economics was
something between Pour la The
Wealth of Nations, Book 1 Smith called book 1, “Of
the Causes of Improvement in the productive Powers of Labour,
and of the Order according to which its Produce is naturally distributed
among the different Ranks of the People,” one of those people not being a moderntype book editor, who would have punched-up the
title. Smith began by asking two
very large questions: How is wealth produced, and how is it distributed? Over
the course of the 250-some pages in book 1 the answers—”division of labor”
and “mind your own business”—are explained. But in the meantime Smith
answered two even larger questions: Why is everyone equal, and why do we have
property rights? All men are created equal.
We hold this truth to be self-evident, which on the face of it is so wildly
untrue. Equality is the foundation of liberal democracy, rule of law, a free
society, and everything that the reader, if he or she is sane, cherishes.
But are we all equal because we all showed up? It does not work that way at
weddings or funerals. Are we all equal because it says so in the American
Declaration of Independence, the French Declaration of the Rights of Man,
and the UN Universal Declaration of Human Rights? Each of these documents
contains plenty of half-truths and nontruths as
well. The UN proclaims, “Everyone has the right to rest and leisure,
including reasonable limitation of working hours.” I’ll have my wife inform
the baby. High-minded screeds cobbled
together by unrepresentative and, in some cases, slightly deranged members of
the intelligentsia are not scripture. Anyway, to see what a scripture-based
polity gets for a social system we have only to look at the Taliban in When Smith considered how
division of labor developed, he briefly—for Smith—directed our attention to
an interesting and characteristic quality of man. The most powerful creature
to ever stride the earth is the most pitifully helpless. We are born
incapable of caring for ourselves and remain so—to judge by today’s
youth—until we’re forty. At the age of two when any other mammal is in its
peak earning years, hunting, gathering, and procreating, the human toddler
cannot find its ass with both hands, at least not well enough to use the
potty. The creativity of a Daniel Defoe couldn’t get Robinson Crusoe through
the workweek without a supply of manufactured goods from the shipwreck’s hold
and the services of a cannibal executive assistant. We must treat other people
with the respect due to equals not because we are inspired by principle or
filled with fraternal affection but because we’re pathetic and useless. Smith wrote that an
individual “stands at all times in need of the co-operation and assistance of
great multitudes, while his whole life is scarce sufficient to gain the
friendship of a few persons.”1 This nearly left-wing statement was
the prologue to Adam Smith’s most quoted passage: “It is not from the benevolence
of the butcher, the brewer, or the baker, that we expect our dinner, but from
their regard to their own interest.”2 Smith wasn’t urging us to
selfishly pursue wealth in the free enterprise system. He was urging us to
give thanks that the butcher, the brewer, and the baker do. It is our good
fortune that they are endowed by their Creator with certain unalienable rights, that among these are steak, beer, and hoagie
rolls. Smith’s answer to why we
have property rights was equally straightforward: “The property which every
man has in his own labour, as it is the original
foundation of all other property, so it is the most sacred and inviolable.”3
Property rights are not an invention of the rich to keep poor people
off their property. Property rights are the deed we have to ownership of
ourselves. The property may be modest, but it is inherent. “The patrimony of
a poor man,” Smith wrote, “lies in the strength and dexterity of his hands.”4
From this humble grasp of hammer and, ahem, sickle, comes all free
enterprise: “and to hinder him from employing this strength and dexterity in
what manner he thinks proper without injury to his neighbour,
is a plain violation of this most sacred property.”5 Any definition of liberty
that is not based on a right to property and a right to the same rights as
all other people have is meaningless. What we have is ours, and nobody can
push us around. This is practically all we mean when we say we are free.
Other rights derive from these, when we even bother with those other rights. Freedom of speech is
wonderful, if you have anything to say. A search of the “blogosphere”
reveals that hardly anyone does. Freedom of religion is more wonderful, but
you can, when you pray, “enter into thy closet, and when thou hast shut thy
door, pray to thy Father which is in secret” (Matt. 6:6). Jesus Christ
himself said so. Freedom is mostly a workaday experience, taking place in he
material, economic world. Before Adam Smith was even well under way with The Wealth of Nations he had proved
that we require and deserve an equitable society where we’re free from the
exercise of arbitrary power and can go to the mall and swipe our Visa cards
until the magnetic strips are toasted crisp, if that’s what we want. The
Divisibility of Labor However, the main purpose of Book 1 of Wealth, as Smith
conceived it, was to show the importance of the division of labor. The
purpose of division of labor, wrote Smith, is “to make a smaller quantity of labour produce a greater quantity of work.”6
Smith perceived that the division of labor—specialization—is the original
source of economic growth. Specialization increases
economic value. As an example Smith famously used the “trifling manufacture”
of a pin. Without specialization and specialists’ machinery it would take us
all day to make one pin. In an early draft of Wealth, Smith noted that if we went so far as to dig in the iron
mines, smelt our own ore, and so forth, we could “scarce make a pin in a
year.”7 And somewhere a group of hobbyists—contactable via the
Internet— is doing just that, to the irritated mystification of their wives. Busy readers
will learn more about The Wealth of
Nations from reading O’Rourke’s On The
Wealth of Nations, than is likely to happen by picking up the original. While
I never found Cliff’s Notes to be satisfying (although necessary on a few
academic deadline occasions), On the
Wealth of Nations was a joy to read. Steve Hopkins,
March 23, 2007 |
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The recommendation rating for
this book appeared in the April 2007
issue of Executive Times URL for this review: http://www.hopkinsandcompany.com/Books/On
the Wealth of Nations.htm For Reprint Permission,
Contact: Hopkins & Company, LLC • E-mail: books@hopkinsandcompany.com |
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