Affirming Democracy, Gathering Resistance

Robert Reich in his substack recently reminded us that this year is the 250th anniversary not only of the US but also of Adam Smith’s monumental work, The Wealth of Nations. The one idea that most people know from this 500-page book is “the invisible hand”–the idea that the marketplace would, by way of thousands and thousands of individual transactions, involving adjustments of demand, supply, and price, distribute goods and services efficiently. The term has become a virtual mantra for many on the Right, undoubtedly most of whom have never read the book. Still, “invisible hand” is trotted out as a kind of unanswerable argument against any sort of government regulation. This despite the fact that the term appears exactly once in the book; it was decidedly not for Smith meant to signal a comprehensive theory.

Reich points out that, in fact, Smith was hardly a conservative–in his own time or for ours–and that Wealth was a revolutionary text, aligned with other Enlightenment texts–like those of Locke, Rousseau, Thomas Paine, and for that matter the American Declaration–in advancing a then-still-new vision of the dignity, equality, and worth of the individual human being, especially as a citizen within a nation. Smith reframed “the wealth” of a “nation,” treating it not as, to put it simply, the holdings of the monarch and the nobility but rather in this way, according to Reich:

A nation’s wealth was to be judged by the total value of all the goods its people produced for all its people to consume. To a reader in the 21st century, this assertion may seem obvious. At the time he argued it, it was a revolutionary democratic vision.

Today, of course, we are witnessing a different sort of “invisible hand”: a great, corrupt monarchical heist of the nation’s wealth by Trump, his family, his 1%-of-1% pals–and this on top of the massive transfer of wealth from the lower and middle classes to the upper classes that has transpired over the past thirty years.

So, a good time to overcome the ironic cooptation of Smith by the Right. Reich concludes:

In these times, as when Adam Smith wrote, it is important to remind ourselves of the revolutionary notion at the heart of Smith’s opus — that the wealth of a nation is measured not by its accumulated riches, but by the productivity and living standards of all its people.

You might not be tempted to read Wealth of Nations, but I hope you’ll take a look at Reich’s piece.