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A case for compassionate capitalism from its “founding father”

If one were to believe without question what liberals say in the mainstream media and in academia about capitalism, one would think capitalism is all about greed, oppression, division, and using law enforcement and/or military to secure only the rights of the rich and powerful at the expense of the poor. One would believe no one espousing capitalism believes in fairness and helping the poor. So they criticize and vilify people like Adam Smith, the 18th century godfather of capitalism.

Adam Smith, "Founding Father" of free market capitalism
Adam Smith, “Founding Father” of free market capitalism

However, they are either mistaken or deliberately misleading regarding the nature of a capitalist society that Adam Smith envisioned or benefits of capitalism he noticed already existing in his society. Smith was very concerned that free market societies made sure the poor and less fortunate were given every opportunity to improve themselves by their own volition and with the help of the more fortunate if the poor proved themselves responsible. Unfortunately, pro-capitalists don’t highlight this enough.

The following quotes are from Smith’s primer on capitalism, An Inquiry into the Nature and Causes of the Wealth of Nations, or more commonly known as The Wealth of Nations:

♦ …man has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only. He will be more likely to prevail if he can interest their self-love in his favour, and show them that it is for their own advantage to do for him what he requires of them. Whoever offers to another a bargain of any kind, proposes to do this. Give me that which I want, and you shall have this which you want, is the meaning of every such offer; and it is in this manner that we obtain from one another the far greater part of those good offices which we stand in need of. 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. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages. Nobody but a beggar chuses to depend chiefly upon the benevolence of his fellow-citizens. Even a beggar does not depend upon it entirely. The charity of well-disposed people, indeed, supplies him with the whole fund of his subsistence. But though this principle ultimately provides him with all the necessaries of life which he has occasion for, it neither does nor can provide him with them as he has occasion for them. The greater part of his occasional wants are supplied in the same manner as those of other people, by treaty, by barter, and by purchase. With the money which one man gives him he purchases food. The old cloaths which another bestows upon him he exchanges for other old cloaths which suit him better, or for lodging, or for food, or for money, with which he can buy either food, cloaths, or lodging, as he has occasion. (Book I, chapter II)

♦ Smith was against the law of settlements, which oppressed the poor by giving them a short time to get on their feet financially before they were forcibly evicted from the parish where they had temporary housing– To remove a man who has committed no misdemeanour from the parish where he chuses to reside, is an evident violation of natural liberty and justice. The common people of England, however, so jealous of their liberty, but like the common people of most other countries never rightly understanding wherein it consists, have now for more than a century together suffered themselves to be exposed to this oppression without a remedy. …There is scarce a poor man in England of forty years of age, I will venture to say, who has not in some part of his life felt himself most cruelly oppressed by this ill-contrived law of settlements.  (Book I, chapter X)

♦ Smith hated abusive taxation rendered by both the state and the Church forced on the poor to satisfy the wasteful spending of the powerful– …the colony government of [Spain, Portugal, & France] is conducted upon a much more expensive ceremonial. The sums spent upon the reception of a new viceroy of Peru, for example, have frequently been enormous. Such ceremonials are not only real taxes …but they serve to introduce among them the habit of vanity and expence upon all other occasions. They are not only very grievous occasional taxes, but they contribute to establish perpetual taxes of the same kind still more grievous; the ruinous taxes of private luxury and extravagance. In the colonies of all those three nations too, the ecclesiastical government is extremely oppressive. Tithes take place in all of them, and are levied with the utmost rigour in those of Spain and Portugal. All of them, besides, are oppressed with a numerous race of mendicant friars, whose beggary being not only licensed but consecrated by religion, is a most grievous tax upon the poor people, who are most carefully taught that it is a duty to give, and a very great sin to refuse them their charity. (Book IV, chapter 7)

♦ Smith believed publicly funded schools were a good idea if they were organized to help children learn science-based skills for their careers or jobs to strengthen society– …the most essential parts of education, however, to read, write, and account, can be acquired at so early a period of life that the greater part even of those who are to be bred to the lowest occupations have time to acquire them before they can be employed… For a very small expence the public can facilitate… and can even impose upon almost the whole body of the people the necessity of acquiring those most essential parts of education.

If in those little schools the books, by which the children are taught… they were instructed in the elementary parts of geometry and mechanics [engineering], the literary education of this rank of people would perhaps be as complete as it can be. There is scarce a common trade which does not afford some opportunities of applying … principles of geometry and mechanics, and which would not therefore gradually exercise and improve the common people in those principles, …as well as to the most useful sciences. (Book V, chapter 1)

♦ Smith admired the positive role churches could play in a society if their character set positive standards for the poor & to make government accountable, but also noted the dangers of society when churches did not live up to good standards– Both the hospitality and the charity of the ancient clergy…are said to have been very great. They…maintained almost the whole poor of every kingdom. …Those virtues procured them the highest respect and veneration among all the inferior ranks of people, of whom many were constantly, and almost all occasionally, fed by them. …In this state of things, if the sovereign frequently found it difficult to resist the confederacy of a few of the great nobility, we cannot wonder that he should find it still more so to resist the united force of the clergy… In such circumstances the wonder is, not that he was sometimes obliged to yield, but that he ever was able to resist.

…that spiritual authority was much weakened when it ceased to be supported by the charity and hospitality of the clergy. The inferior ranks of people no longer looked upon that order, as they had done before, as the comforters of their distress, and the relievers of their indigence. On the contrary, they were provoked and disgusted by the vanity, luxury, and expence of the richer clergy, who appeared to spend upon their own pleasures what had always before been regarded as the patrimony of the poor. (Book V, chapter 1)

Capitalists who espouse Smith’s principles, which he based on true Christian doctrine, are true capitalists indeed.

Harry A. Gaylord

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2 thoughts on “A case for compassionate capitalism from its “founding father”

  1. If capitalism is really all that great, why so much corruption? Doesn’t it just contribute to a greater wealth gap and people gaming the system?

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    1. Citizen60,

      Corruption comes from human nature. We are inherently sinful and it will be reflected in whatever system we set up. A lot of markets based on capitalism aren’t pure capitalism. It’s cronyism set up by the globalists (Freemasons, Bilderberg, etc.). However, those less than pure systems do still provide several avenues for the less fortunate to work their way up and capitalism in Adam Smith’s writings was a system that encouraged checks and balances as well as resistance against injustice while discouraging the greed and envy seen in socialism. So I would still take a less than pure form of capitalism over any other system since it gives me the opportunity to right wrongs.

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