Only a bit rich
The National Business Review has released its 2012 ‘Rich List’ of the wealthiest New Zealanders.
Well, the wealthiest people who occasionally drop in to New Zealand … or, maybe, own some land in New Zealand … or, maybe, have an ‘investment’ in New Zealand … or … who cares?
Maybe Adam Smith does?
From Adam Smith’s ‘Theory of Moral Sentiments:
This disposition to admire, and almost to worship, the rich and the powerful, and to despise, or, at least, to neglect persons of poor and mean condition, though necessary both to establish and to maintain the distinction of ranks and the order of society, is, at the same time, the great and most universal cause of the corruption of our moral sentiments. That wealth and greatness are often regarded with the respect and admiration which are due only to wisdom and virtue; and that the contempt, of which vice and folly are the only proper objects, is often most unjustly bestowed upon poverty and weakness, has been the complaint of moralists in all ages.
We desire both to be respectable and to be respected. We dread both to be contemptible and to be contemned. But, upon coming into the world, we soon find that wisdom and virtue are by no means the sole objects of respect; nor vice and folly, of contempt. We frequently see the respectful attentions of the world more strongly directed towards the rich and the great, than towards the wise and the virtuous. We see frequently the vices and follies of the powerful much less despised than the poverty and weakness of the innocent. To deserve, to acquire, and to enjoy the respect and admiration of mankind, are the great objects of ambition and emulation. Two different roads are presented to us, equally leading to the attainment of this so much desired object; the one, by the study of wisdom and the practice of virtue; the other, by the acquisition of wealth and greatness. Two different characters are presented to our emulation; the one, of proud ambition and ostentatious avidity; the other, of humble modesty and equitable justice. Two different models, two different pictures, are held out to us, according to which we may fashion our own character and behaviour; the one more gaudy and glittering in its colouring; the other more correct and more exquisitely beautiful in its outline: the one forcing itself upon the notice of every wandering eye; the other, attracting the attention of scarce any body but the most studious and careful observer. They are the wise and the virtuous chiefly, a select, though, I am afraid, but a small party, who are the real and steady admirers of wisdom and virtue. The great mob of mankind are the admirers and worshippers, and, what may seem more extraordinary, most frequently the disinterested admirers and worshippers, of wealth and greatness.
For once, I have nothing to add.
I always enjoy seeing TMS quoted rather than WON. It paints a broader picture of Smith and his understanding of humanity, which is far removed than the simplicity of the “invisible hand”. He appreciates the ability of the marketplace to intuit, by its operation, the wants and needs of the population. Yet he never sees this as taking place in isolation. There must be some moral or ethical framework sitting above, a reason for all this activity and a method of sharing its benefits.
In fact, he first mentions the “invisible hand” in TMS:
“They are led by an invisible hand to make nearly the same distribution of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants, and thus without intending it, without knowing it, advance the interest of the society.”
Hi Raf,
Yes, the Theory of Moral Sentiments is one of those remarkable inquiries from first principles that is leavened with some subtle observations of the conditions under which various moral sentiments and judgments typically arise. Though he was a religious man and clearly saw a supreme God overseeing the whole affair his analysis is, nevertheless, quite in keeping with an evolutionary account of what we might expect in the way of moral judgments in particular situations. It’s remarkably ‘modern’ in its pragmatism about the human condition, too.
A very good read.
(I’m also trying to get through Wealth of Nations again. I’m afraid my eyes keep getting heavy through the bits on the price of corn and the consumption of silver from South American silver mines 🙂
This highlights a distinct difference between the economists of Smith’s era and today. In Smith’s era they were philosophers more than anything else while today, well, amorality seems to be the go. Getting rich is the end in itself of modern economics with the predictable result of extreme wealth amongst extreme poverty.
Hi Draco T Bastard,
Yes, somewhere along the line (probably around about the introduction of calculus in the 19th century and the aping of the natural sciences) people, in all their ‘flawed’ humanity, dropped out of economic thinking. Smith was an acute observer of human behaviour and interactions. He was also quite a practical man and had the advantage of starting the discussion about how people operated in the economic sphere and so, naturally, he talked about people selling and buying, not ‘market agents’ or whatever the term would be in today’s economics.
When he talked about the baker and brewer acting out of ‘self-interest’ i presume what he had in mind was their whole, rounded self-interest as people in a community concerned about their reputation and character. Today that famous quotation (from Wealth of Nations) is used to defend financial self-interest in abstracted market transactions – not quite the same idea of ‘self-interest’ if you think about it.
Thanks for commenting!
Puddleglum