Adam Smith is widely regarded as the grandfather of modern capitalism. It was he who first established economics as a separate branch of knowledge, and many would vouch that his work has never been surpassed. But what is often lost in any discussion of his economic theory is his quiet Christianity. The Scottish Thinker's famous friendship with the humanist philosopher David Hume demonstrates his liberalism, rather than atheism. There can be little doubt that the infamous phrase "the invisible hand" had deep theological significance for Smith, and yet is grossly over quoted by critics who never bothered to actually read Smith. They just want a label. Smith only thrice used the phrase in all of his surviving works, once in each of his two published books and again in an unpublished treatise on astronomy. In each, the invisible hand has a distinct contextual meaning.
In his seminal 1775 book "The Wealth of Nations", Smith sets out the economic expression of what he meant by the invisible hand:
But recently, at least one expert on Smith's work has provided a deeper interpretation. Australian economist and Christian theologian Dr. Paul Oslington, argues persuasively that many words and phrases in Smith's writings, such as "natural", and "the Author of nature", or "the invisible hand", represent the Christian doctrine of divine providential care for humanity. Simply put, Adam Smith was a Christian philosopher.
According to Oslington, Smith was extending into secular writing the project of "natural theology", in the same fashion that Sir Isaac Newton famously did in the realm of science. In a phrase dating back to Thomas Acquinas, God's "other book" was physical nature. For Smith, it was also social nature. The word "nature" and its permutations are quite prevalent in Smith's work. The term appears nearly 700 times in "Wealth of Nations" and over 500 times in "The Theory of Moral Sentiments." Seldom does it refer, however, in a Darwinian sense to merely the natural physical world. Overwhelmingly it is used in "Wealth of Nations" in an economic-psychological sense and in "The Theory of Moral Sentiments" in a socio-theological sense:
"The happiness of mankind, as well as of all other rational creatures, seems to have been the original purpose intended by the Author of nature, when he brought them into existence. No other end seems worthy of that supreme wisdom and divine benignity which we necessarily ascribe to him...by acting according to the dictates of our moral faculties, we necessarily pursue the most effectual means for promoting the happiness of mankind, and my therefore be said...to co-operate with the Deity, and to advance...the plan of Providence."
This is clearly Christian theology. Smith's Christianity was not evangelical in terms of expressing an enthusiastic relationship with Our Lord and Saviour. In neither book does he mention "Christ" or "Jesus". Smith's faith was institutional, the polite version of Anglicanism common to the Neo-classical era, today considered mainstream Protestantism.
Some intellectuals have opposed this view, arguing that Smith was merely being cautious and conventional in his Christianity to avoid making enemies harmful to his career and publications. But the portrait of Smith as a careerist is unpersuasive, appealing though it may be to non-believers who admire Smith's science. It is understandable for us to want such heroes to reflect our own fancied consistencies.
Nor was Smith an intellectual coward. He denounced mercantilism, the populist position of his era. Trade deals, for example, are always expressed in mercantilist form: give us access to your markets and we will give you access to ours, because what we want is a positive balance of payments. Smith could have gone along with the socially correct mob, but staunchly refused. Still less plausible is the supposition that he would have lied when agreeing to the Thirty-Nine Articles of faith or achieved his academic chairs without scrutiny. Oxford and Cambridge were required by the English Test Act of 1673 to subscribe all students and faculty to each one of the Church of England's Thirty-Nine Articles of Religion. Non-conformists such as Quakers, Baptists, Congregationalists and of course Jews were forbidden to attend there until 1871. Smith spent six years studying at Oxford, and afterward held non-controversial appointments at the University of Glasgow and the University of Edinburgh.
Smith was of course a liberal, courageous advocate for the once scandalous notion that we should adopt "the obvious and simple system of natural liberty, the liberal plan of equality, liberty, and justice." Note the first term in the liberal trinity. Smith was a radical egalitarian, but his equality was not that of his rival Rousseau, who was at the headwaters of socialism and coerced equality of outcome. Nor was it that of the ancient Spartans so admired by the 18th century conservatives and modern New Liberals, a coerced equality of opportunity. Equality for the Spartans was achieved by seizing boys from their mothers by age 7 to train them together as warriors. Equality of opportunity is impossible without such utter enslavements to the state.
Equality of permission, however, could be achieved without coercion. Women can seek any type of employment, state occupational licensure is disbanded, tariffs against imports repealed. This is the full Smith laissez-faire plan, which also happens to be the program of liberal Christianity. Liberty of the will, propounded by Erasmus in 1524 through his famous debate on the subject with Martin Luther, grants equal dignity to souls. In the 18th century world of Adam Smith, such liberalism began to extend to all of aspects of human existence. The first great achievement of liberalism was the abolition of slavery. This remains at its core. There can be no human masters, since we are beholden only to Christ Jesus.
Smith was a serious thinker. He did not hold that there was an intrinsic contradiction between Christianity and liberalism. Smith was indeed an advocate of the idea, also embraced by Ayn Rand, that self-interest can promote public good. Smith believed that this unexpected relationship is the result of Divine teleology rather than happenstance. He also rejected the idea that selfishness is a virtue and instead endorsed altruistic empathy. In fact, he devoted an entire book, "The Theory of Moral Sentiments" in defense of Christian virtues such as altruism and charity. On the subject of the invisible hand, Smith said this:
"By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by the invisible hand to promote an end which as no part of his intention...By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it."
All of which begs the question: whose invisible hand was Smith referencing here? And, what is the invisible hand? The answer is simple: God's providence. Smith made this abundantly clear in his "Theory of Moral Sentiments", where he first introduced the invisible hand metaphor:
"The produce of the soil maintains at all times nearly that number of inhabitants which it is capable of maintaining. The rich only select from the help what is most precisely and agreeable. They consume little more than the poor, and in spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they propose from the labours of all the thousands whom they employ, is the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements. 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, and afford means to the multiplication of the species. When Providence divided the earth among a few lordly masters, it neither forgot nor abandoned those who seemed to have been left out in the partition."
The invisible hand here is the hand of "Providence", which is capitalized by Smith for emphasis. Elsewhere in "Moral Sentiments", Smith pointed to private virtue and its social benefits as a means for us to "cooperate with the Deity", thereby linking the Deity, Providence and God in one statement:
"But by acting according to the dictates of our moral faculties, we necessarily pursue the most effectual means for promoting the happiness of mankind, and may therefore be said, in some sense, to cooperate with the Deity, and to advance as far as in our power the plan of Providence. By acting other ways, on the contrary, we seem to obstruct, in some measure, the scheme which the Author of nature has established for the happiness and perfection of the world, and to declare ourselves, if I may say so, in some measure the enemies of God."
It is thus impossible to deny the presence of God in the writings of Adam Smith. Smith's stance for economic freedom against the contemporary policies of the English Crown showed him to be one willing to say what he truly thought. He therefore laces his works throughout with Christian references.
The "Wealth of Nations" is a sly and subversive classic of secular humanism too often mistaken today for a mere lecture upon the benefits of capitalism. In it, Smith said little about religion, and yet he managed to adroitly point to the forces that still shape the role of religion in Western politics today. His analysis is a better guide to the future of the evangelical movement than are most contemporary accounts. Smith saw much of what we now see: the progress of modernity was not undermining religion in the Britain of his day. Instead, religious revivals were blooming. These new religious movements often rejected the liberal values of a free society. They favoured absolute moral codes, conservative interpretations of religious doctrines, and political activism to enact their values into law.
Smith observed a relationship between these revivals and the process we now call urbanization. Young people, arriving in cities in search of work, faced new opportunities and temptations absent the structure which village life-with its communities of relatives and others to watch over and guide youth-had once provided. "A single week's thoughtlessness and dissipation is often suffice to undo a poor workman forever", wrote Smith about life in London. But the city's small sectarian religious congregations gave rural immigrants a social support network and a moral code to keep them on the straight and narrow as they forged new lives. These movements were a response to the dislocations of modernity; there was no reason to expect them to fade away.
Yet in the teeming religious marketplace of Britain's cities, Smith also saw pressures limiting the political impact of religious beliefs and preventing theocracy. With so many competing denominations, he noted, religious leaders could acquire political influence only by finding allies outside their own version of the faith-and the process of forming those alliances would drive them toward agendas drawing a wider, multi-faith audience. To be politically significant, he wrote, religious extremists had to move toward broader and necessarily more more moderate coalitions. Their entry into politics would, itself, moderate them. As Smith puts it eloquently in the opening paragraph of "Moral Sentiments":
"How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it."
Smith wrote this seven years prior to "Wealth of Nations", and regarded "Moral Sentiments" as his most important work because in it he identified the profound human instinct to act not necessarily in self-interest but through, as he phrased it, a "mutual sympathy of sentiments."The work is divided into seven parts. In Part 1: Of the Propriety of Action, Smith posits that sympathy, can found human actions towards others, prompted by various emotions-be it perception of misfortune in others or simply 'the pleasure of mutual sympathy.' Other parts include 'Of the Effect of Utility upon the Sentiment of Approbation', 'Of the Character of Virtue' and finally 'Of Systems of Moral Philosophy'.
In this concluding section, Smith considers the views of other philosophers, including Epicurus, Zeno, Plato, Aristotle, Cicero, and Hobbes, as well as the opinions of his mentor, Sir Francis Hutchinson. Smith proposes that mankind's sense of morality is interwoven with social instincts as much as reason or self-interest. Sympathy, or the contemporary word "empathy", is a universal and strongly held human emotion, imbued with the Christian virtues of prudence, justice, and beneficence.
Adam Smith believed in meritocracy. He emphasized advancement made possible by human will to better ourselves. He is now widely regarded as the greatest economist of all time. But what he really thought, and the implications of his ideas, remain fiercely contested. Was he an eloquent advocate of capitalism and individual freedom? A prime mover of market fundamentalism? An apologist for human selfishness? Or something else entirely?
Smith clearly saw himself primarily as a philosopher rather than an economist, and would never have predicted that the ideas for which he is now best known were his most important. The "Wealth of Nations" and "The Theory of Moral Sentiments" were part of a larger scheme to establish a grand 'Science of Man'-one of the most ambitious projects of the European Enlightenment, which was to encompass law, history, aesthetics, economics, and even ethics. As we have seen, at the heart of Smith's doctrine is an optimistic view of the effects of self-interest. Though each individual seeks only personal gain, the collective result is increased prosperity and freedom, which benefits society as a whole. Seen in this way, there can be no question whose "invisible hand" guides the hearts, minds, and actions of mankind toward a Divine Providence entailing liberty, free will, benevolence, and Christian charity.