Adam Smith Wealth of Nations

Adam Smith published his Inquiry into the Nature and Causes of the Wealth of Nations in 1776, adding a second revolutionary event to that fateful year. A political democracy was born on one side of the ocean; an economic blueprint was unfolded on the other. But while not all Europe followed America's political lead, after Smith had displayed the first true tableau of modern society, all the Western world became the world of Adam Smith: his vision became the prescription for the spectacles of generations. Adam Smith would never have thought of himself as a revolutionist; he was only explaining what to him was very clear sensible, and conservative. But he gave the world the image of itself for which it had been searching. After The Wealth of Nations, men began to see the world about themselves with new eyes; they saw how the tasks they did fitted into the whole of society, and they saw that society as a whole was proceeding at a majestic pace toward a distant but clearly visible goal. In a word, a new vision had come into being. What was that new vision? As we might expect, it was not a State but a System -- more precisely, a System of Perfect Liberty. Smith's vision is like a blueprint for a whole new mode of social organization, a mode called Political Economy, or, in today's terminology, economics.

At the center of this blueprint are the solutions to two problems that absorb Smith's attention. First, he is interested in laying bare the mechanism by which society hangs together. How is it possible for a community in which everyone is busily following his self-interest not to fly apart from sheer centrifugal force? What is it that guides each individual's private business so that it conforms to the needs of the group? With no central planning authority and no steadying influence of age-old tradition, how does society manage to get those tasks done which are necessary for survival? These questions lead Smith to a formulation of the laws of the market. What he...