Two bookends that bind American culture are the US Constitution and the Bill of Rights. Without them, our freedoms collapse like cascading books. Two bookends that bind American capitalism are Adam Smith’s 1776 classic An Inquiry into the Nature and Causes of the Wealth of Nations and… what else? Smith also wrote the other bookend, tying Wealth to an ageless wisdom that keeps our free markets from cascading off a shelf.
The story of these two bookends begins a century after the first settlers landed in America. As Hannah Arendt notes in her book On Revolution, Europeans began to take note of the new experiment in which hundreds of thousands of formerly poor people were within a generation or two living in comfortable homes of their own, enjoying a prosperity unprecedented in Europe.1 David Brooks adds that by 1740 “the American population as a whole enjoyed a higher standard of living than the population of any European country.”2 What accounted for this prosperity? Adam Smith knew.
Smith was a Scotsman born in 1723. He attended the University of Glasgow and earned a degree from Oxford. He earned his keep as a moral philosopher, delivering public lectures in 1748 at Edinburgh and, after earning a professorship at Glasgow University, he began teaching logic courses in 1751. When the Chair of Moral Philosophy died the next year, Smith took over the position. For the next thirteen years, he would write and teach, publishing the first bookend for business in 1759 – The Theory of Moral Sentiments. In a nutshell, Adam Smith said that free markets flourish when planted in a moral soil – where the best head is joined to the best heart.
Wise and judicious conduct, when directed to greater and nobler purposes, is called prudence. Prudence, combined with valour, benevolence, a sacred regard to the rules of justice, and supported by a proper degree of self-command – necessarily supposes the art, the talent, and the habit of acting with the most perfect propriety in every possible circumstance (and) necessarily supposes the utmost perfection of all the intellectual and of all the moral virtues. It is the best head joined to the best heart.3
The Theory of Moral Sentiments set the stage for Smith’s celebrated second bookend, The Wealth of Nations. It’s remarkable because Smith did not ask the conventional questions about the causes of poverty. In ancient cultures, where poverty was widespread, most economists stressed the questions that had to deal with poverty.4 Adam Smith instead asked how “real wealth” was created and broadened the definition beyond gold and silver to include “the annual produce of the land and labour of the society.”5 He “was the first man in history to conceive of a world from which poverty will be banished, a world of ‘universal affluence’ (his phrase), a world in which every woman, man, and child will be liberated from the prison of poverty,” Michael Novak writes.6
With these two bookends, Smith bound markets to morality and wealth to wisdom derived from the Judeo-Christian tradition. In fact, the title for Smith’s book is used more than once in Scripture. “The riches of the sea shall be lavished upon you and you shall possess the wealth of nations” (Isa. 60:5); “you shall enjoy the wealth of the nations and in their glory you shall glory” (Isa. 61:6) and finally, “Rejoice with Jerusalem… I will extend prosperity to her like a river, and the wealth of the nations…” (Isa. 66:11-13). Adam Smith rightly recognized that affluence is a condition and money is a commodity – a distinction found in scripture (and why we’re to love affluence, but not money).
There are two ironies here. The first is that many Christians delight in morality yet often disdain affluence and wealth – we’re stacking our books against only one bookend. Poverty, however, is not more spiritual than being wealthy.7 “Being affluent in a certain way – called “delight” – indeed reflects the good created order of God,” writes theologian John Schneider.8 Affluence can be good in the potential it has “for human flourishing and, through it, the flourishing of the cosmos as God wills it to be.”
The second irony is that others stack all their books against the second bookend – wealth. They’ve forgotten that the virtues sustaining capitalism and free markets were not lying around “here in America waiting for us. Just the opposite, they came with the Bibles that were carried in our grandparents’ steamship trunks, and in the lessons they carried in their heads and their hearts from Europe to America,” Michael Novak writes.9 This collective amnesia contributes to the recent calamitous collapse of ethics.
We won’t win people, however, by arguing about amnesia. C. S Lewis said you win with metaphor, or a new picture. In July of 1787, the ‘Committee of the Society for the purpose of effecting the abolition of the Slave Trade’ asked the great pottery-maker Josiah Wedgwood to design a new picture. He created a seal showing a kneeling slave asking: “AM I NOT A MAN AND A BROTHER?” This motto became a “conversation starter” that roused England. Is there a modern day Wedgwood who would produce a new set of bookends – one called The Wealth of Nations and the other, The Theory of Moral Sentiments? I’d buy several sets and bet that the enterprise would turn a profit.
1 Michael Novak, “The Spirit of Capitalism.” Keynote address given at the 30th Pio Manzù International Conference “Islands without an archipelago: Economies, the masses, nation states in search of a new sovereignty,” October 17, 2004.
2 David Brooks, On Paradise Drive: How We Live Now (And Always Have) in the Future Tense (New York, NY: Simon & Schuster, 2004), p. 252.
3 Adam Smith, The Theory of Moral Sentiments (Oxford, UK: Oxford University Press, 1976 ).
4 John R. Schneider, The Good of Affluence: Seeking God in a Culture of Wealth (Grand Rapids, MI: Eerdmans, 2002), p. 1.
5 Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations (Oxford, UK: Oxford University Press, 1976 ), p. 12.
6 Novak, Spirit of Capitalism.
7 Dallas Willard, The Divine Conspiracy: Rediscovering Our Hidden Life in God, San Francisco, CA: HarperCollins, 1998), pp. 193-219.
8 Schneider, Good of Affluence, p. 4.
9 “North Atlantic Community, European Community: Divergent paths and common values in Old Europe and the United States,” a speech delivered by Michael Novak for the F.A. Hayek Foundation in Bratislava, Slovakia on July 3, 2003.