Thank you Adam Smith

It's a busy week. This week also marks the 250th anniversary of Adam Smith's Wealth of Nations, the first in-depth exploration and explanation of (in PJ O'Rourke's words) why some nations are prosperous and wealthy and other places just suck.In honour of the anniversary, here are several of Adam Smith’s most insightful observations:

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 necessities but of their advantages. [The Wealth Of Nations, Book I, Chapter II]

It is the great multiplication of the productions of all the different arts, in consequence of the division of labour, which occasions, in a well-governed society, that universal opulence which extends itself to the lowest ranks of the people. [The Wealth Of Nations, Book I, Chapter I]

Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes, and a tolerable administration of justice: all the rest being brought about by the natural course of things. [Lecture in 1755, quoted in Dugald Stewart, Account Of The Life And Writings Of Adam Smith LLD, Section IV, 25]

It is the maxim of every prudent master of a family, never to attempt to make at home what it will cost him more to make than to buy. [The Wealth Of Nations, Book IV Chapter I]

By means of glasses, hotbeds, and hotwalls, very good grapes can be raised in Scotland, and very good wine too can be made of them at about thirty times the expense for which at least equally good can be brought from foreign countries. Would it be a reasonable law to prohibit the importation of all foreign wines, merely to encourage the making of claret and burgundy in Scotland? [The Wealth Of Nations, Book IV, Chapter II]

Consumption is the sole end and purpose of all production; and the interest of the producer ought to be attended to, only so far as it may be necessary for promoting that of the consumer. [The Wealth Of Nations, Book IV Chapter VIII]

People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices…. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies, much less to render them necessary. [The Wealth Of Nations, Book IV Chapter VIII]

To widen the market and to narrow the competition, is always the interest of the dealers…The proposal of any new law or regulation of commerce which comes from this order, ought always to be listened to with great precaution... It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it. [The Wealth Of Nations, Book I, Chapter XI]

It is the highest impertinence and presumption… in kings and ministers, to pretend to watch over the economy of private people, and to restrain their expense... They are themselves always, and without any exception, the greatest spendthrifts in the society. [The Wealth Of Nations, Book II, Chapter III]

There is no art which one government sooner learns of another than that of draining money from the pockets of the people. [The Wealth Of Nations, Book V Chapter II Part II] 

Every individual... neither intends to promote the public interest, nor knows how much he is promoting it... 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 an invisible hand to promote an end which was no part of his intention.
    Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good. [The Wealth Of Nations, Book IV, Chapter II]

What improves the circumstances of the greater part can never be regarded as an inconveniency to the whole. No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable. [The Wealth Of Nations, Book I Chapter VIII]

Mercy to the guilty is cruelty to the innocent. [From his 1759 work, The Theory of Moral Sentiments]

The man of system…is apt to be very wise in his own conceit; and is often so enamoured with the supposed beauty of his own ideal plan of government, that he cannot suffer the smallest deviation from any part of it… He seems to imagine that he can arrange the different members of a great society with as much ease as the hand arranges the different pieces upon a chess-board. He does not consider that in the great chess-board of human society, every single piece has a principle of motion of its own, altogether different from that which the legislature might choose to impress upon it. [The Theory Of Moral Sentiments, Part VI, Section II, Chapter II]

"The time will therefore come when the sun will shine only on free men who know no other master but their reason"

"The time will therefore come when the sun will shine only on free men who know no other master but their reason; when tyrants and slaves, priests and their stupid or hypocritical instruments will exist only in works of history and on the stage; and when we shall think of them only to pity their victims and their dupes; to maintain ourselves in a state of vigilance by thinking of their excesses; and to learn how to recognise and so to destroy, by force of reason, the first seeds of tyranny and superstition, should they ever dare to reappear amongst us."

~ French philosopher & mathematician Marquis de Condorcet, from his 1794 book Sketch for a Historical Picture of the Progress of the Human Mind [hat tip Matthew H]

"Don't get mad..."

"'Don't get mad,' Mr. James had told him. 'State your case --your facts and your reasons -- and don't raise your voice. You aren't going to win every time, that's just the way it'll be, but you should win more than you lose'."

~ Robert Gore from his 2013 novel The Golden Pinnacle

Intellectual v Artist

"An intellectual is a man who says a simple thing in a difficult way; an artist is a man who says a difficult thing in a simple way."

~ Charles Bukowski

"Welcome to the world of reality - there is no audience."

"Welcome to the world of reality - there is no audience. No one to applaud, to admire. No one to see you. Do you understand? Here is the truth — actual heroism receives no ovation, entertains no one. No one queues up to see it. No one is interested.... True heroism is minutes, hours, weeks, year upon year of the quiet, precise, judicious exercise of probity and care — with no one there to see or cheer. This is the world."

~ David Foster Wallace from his novella Something to Do with Paying Attention

"Underlying most arguments against the free market is a lack of belief in freedom itself.”

“Indeed, a major source of objection to a free economy is precisely that it does this task so well. It gives people what they want instead of what a particular group thinks they ought to want. Underlying most arguments against the free market is a lack of belief in freedom itself.”

~ Milton Friedman from his 1962 book Capitalism and Freedom

Walter Williams on social justice

The late great Walter Williams's thoughts on property, rights and justice are ideal on  post-Budget morning:

• "My definition of social justice: I keep what I earn and you keep what you earn. Do you disagree?…how much of what I earn belongs to you—and why?"
• "If one person has a right to something he did not earn, of necessity it requires that another person not have a right to something that he did earn."
• "Nothing in our Constitution suggests that government is a grantor of rights. Instead, government is a protector of rights.
• "There is no moral argument that justifies using the coercive powers of government to force one person to bear the expense of taking care of another."
• "Government has no resources of its own…government spending is no less than the confiscation of one person’s property to give it to another to whom it does not belong."
• "We don’t have a natural right to take the property of one person to give to another; therefore, we cannot legitimately delegate such authority to government."
• "Exercise of a right by one person does not diminish those held by another."
• "No matter how worthy the cause, it is robbery, theft, and injustice to confiscate the property of one person and give it to another to whom it does not belong."
• "The better I serve my fellow man…the greater my claim on the goods my fellow man produces. That’s the morality of the market."
• "The act of reaching into one’s own pockets to help a fellow man in need is praiseworthy and laudable. Reaching into someone else’s pocket is despicable."

"It's not just a case of governments doing more with less. It's about governments doing less with less."

  

Since it's Budget Week again, here's my helpful compilation of quotes to help journalists looking to spice up their budget-week blogs and broadcasts. (You're welcome.)

Cartoon by Nick Kim

“Taxation is just a sophisticated way of demanding money with menaces.” 
    ~ Terry Pratchett 

"To steal from one person is theft. To steal from many is taxation." 
    ~ Jeff Daiell 

"I don't know if I can live on my income or not — the government won't let me try it."
    ~ Bob Thaves

"The best things in life are free, but sooner or later the government will find a way to tax them."
    ~ Anon.

"A fine is a tax for doing something wrong. A tax is a fine for doing something right."
    ~ Anon.

"Taxation is the price we pay for failing to build a civilised society. The higher the tax level, the greater the failure. A centrally planned totalitarian state represents a complete defeat for the civilised world, while a totally voluntary society represents its ultimate success.
    ~ Mark Skousen

“For every benefit you receive a tax is levied.”
    ~ Ralph Waldo Emerson 

"It's sad to realise that most citizens do not even notice the irony of being bribed with their own money." 
    ~ Anon. 

“The art of taxation consists in so plucking the goose as to obtain the largest possible amount of feathers with the smallest possible amount of hissing.” 
    ~ Jean Baptiste Colbert 

"There are no taxes which have not a tendency to lessen the power to accumulate. All taxes must either fall on capital or revenue. If they encroach on capital, they must proportionably diminish that fund by whose extent the extent of the productive industry of the country must always be regulated; and if they fall on revenue, they must either lessen accumulation, or force the contributors to save the amount of the tax, by making a corresponding diminution of their former unproductive1 consumption of the necessaries and luxuries of life. Some taxes will produce these effects in a much greater degree than others; but the great evil of taxation is to be found, not so much in any selection of its objects, as in the general amount of its effects taken collectively."

    ~ David Ricardo

"See, when the Government spends money, it creates jobs; whereas when the money is left in the hands of Taxpayers, God only knows what they do with it. Bake it into pies, probably. Anything to avoid creating jobs." 
    ~ humorist Dave Barry 

"When the ... government spends more each year than it collects in tax revenues, it has three choices: It can raise taxes, print money, or borrow money. While these actions may benefit politicians, all three options are bad for average [workers]."
    ~ Ron Paul

"If taxes and government spending are both slashed, then the salutary result will be to lower the parasitic burden of government taxes and spending upon the productive activities of the private sector."
    ~ Murray Rothbard

"It's not just a case of governments doing more with less. It's about governments doing less with less. When that realisation dawns, we may discover that most things the government can do, we can do better and a whole lot cheaper."
    ~ William Weld 

"I’m all for reduction of government expenditures but to anticipate it by reducing the rate of taxation before you have reduced expenditure is a very risky thing to do."
    ~ F.A. Hayek

"The real goal should be reduced government spending, rather than balanced budgets achieved by ever-rising tax rates to cover ever-rising spending."
    ~ Thomas Sowell

"A fact is information minus emotion..."

"A fact is information minus emotion. 

"An opinion is information plus experience.
"Ignorance is an opinion lacking information. 

"Stupidity is an opinion that ignores fact."

~ Anonymous

Huxley had a poor view of the populus

"The greater part of the population is not very intelligent, dreads responsibility, and desires nothing better than to be told what to do.
    "Provided the rulers do not interfere with its material comforts and its cherished beliefs, it is perfectly happy to let itself be ruled."

~ Aldous Huxley from his “Complete Essays: 1926-1929”

"Happiness is a state of non-contradictory joy ... "

"Happiness is not to be achieved at the command of emotional whims. Happiness is not the satisfaction of whatever irrational wishes you might blindly attempt to indulge. Happiness is a state of non-contradictory joy—a joy without penalty or guilt, a joy that does not clash with any of your values and does not work for your own destruction, not the joy of escaping from your mind, but of using your mind’s fullest power, not the joy of faking reality, but of achieving values that are real, not the joy of a drunkard, but of a producer. Happiness is possible only to a rational man, the man who desires nothing but rational goals, seeks nothing but rational values and finds his joy in nothing but rational actions."

~ Ayn Rand, from 'Galt’s Speech' in her 1957 novel Atlas Shrugged. Hat tip psychologist Jean Moroney — who "chews" the paragraph sentence by sentence in her latest blog post. There's a lot packed in there, she reckons. "When I re-read this paragraph," she says, "I felt like it had taken me 30 years to understand it in detail, and I still had more to learn from it." You too, probably.

Life is not static

"Our [human] nature lies in movement; complete calm is death ... Nothing is so insufferable to man as to be completely at rest, without passions, without business, without diversions, without study. He then feels his nothingness, his abandonment, his insufficiency, his dependence, his impotence, his emptiness. There will immediately arise from the depth of his heart weariness, gloom, sadness, grief, anger, despair."

~ Blaise Pascal, from his Pensees [Section I, 29-131]

"Never argue with stupid people..."

"Never argue with stupid people, they will drag you down to their level and then beat you with experience."

~ old Proverb (often attrib. Mark Twain)

 

What's a Corporation?

"To differentiate it from a partnership, a corporation should be defined as a legal and contractual mechanism for creating and operating a business for profit, using capital from investors that will be managed on their behalf by directors and officers. To lawyers, however, the classic definition is U.S. Chief Justice John Marshall’s 1819 remark that 'a corporation is an artificial being, invisible, intangible, and existing only in contemplation of law.' But Marshall’s definition is useless because it is a metaphor; it makes a corporation a judicial hallucination."

~ Robert Hessen, from his article 'Corporations' at the Concise Encyclopedia of Economics [hat tip David R. Henderson]

 

"This is the first fact to remember about New Zealanders ..."

"For New Zealand is a good country. It has the feeling of being a very old country, though not at all in the European sense where countries are old with the marks of humanity...
    "New Zealand is very old, much older than any of this, and quite untouched by men. Its rocks and mountains are worn smooth by south Pacific winds. They are very cold to touch and very clean. The country, with its sharp hills, gives you the same feeling as the clear salt of the sea. The country is, in fact, so old in itself that none of us have dared to touch it; we have only just begun to live there. The Maoris who came before us moved among the dark heavy trees like ghosts and could have sailed away at any time and never left a mark. We could leave it ourselves now: in a few years the red-roofed wooden bungalows would rot with borer and crumble into the earth. Fern would cover the grassland and, after fern, small trees would come and in time the dark, rich, matted bush again. Other men might come in a hundred years and nothing that we had left would worry them, but they could draw strength as we have done from the sharp, fierce lines of the hills and the streams always running and the wide sea on every side. 

    "This has been another cause of conflict to New Zealanders, that there have never been enough of them nor have they had sufficient confidence in themselves to take over the country, so that they live there like strangers or as men might in a dream which will one day wake and destroy them. 

    "There is nothing soft about New Zealand, the country. It is very hard and sinewy, and will outlast many of those who try to alter it. 

    "This is one reason why New Zealanders, a young people but already with a place in history, are often wanderers and restless and unhappy men. They come from the most beautiful country in the world, but it is a small country and very remote. After a while this isolation oppresses them and they go abroad. They roam the world looking not for adventure but for satisfaction. They run service cars in Iraq, or goldmines in Nevada, or newspapers in Fleet St. They are a queer, lost, eccentric, pervading people who will seldom admit to the deep desire that is in all of them to go home and live quietly in New Zealand again.

    "Those who do not go abroad and do not travel are afflicted with the same sad restlessness. They are all the time wanting to set out across the wide seas that surround them in order to find the rest of the world... New Zealanders are all the time standing on the edge of these seas. They spend their lives wanting to set out across the wide oceans that surround them in order to find the rest of the world. 

    "One way and another, those who are going and those who are staying have all the time within them this sad inner conflict and frustration. This is the first fact to remember about New Zealanders, who live in the most beautiful country of the world."

          ~ John Mulgan, from his 1947 Report on Experience 

 

"We defeated the divine right of kings, now we have to do the same to the divine right of bureaucrats."

"I would like to think that the cozy post war socialist consensus is coming to a long overdue end. We defeated the divine right of kings, now we have to do the same to the divine right of bureaucrats."

~ Roué le Jour, from their comment on the 'Scorpion State'

How to watch, and read, your news

"[T]the most studious and engaged man can neglect [newspapers and TV news] only at his cost. But have little to do with them. Learn how to get their best too, without their getting yours.... Like some insects, some [news] died the day it was born....

    "There is a great secret in knowing what to keep out of the mind as well as what to put in.... The genuine news is what you want, and practice quick searches for it. Give yourself only so many minutes for the paper [or TV news]. Then you will learn to avoid the premature reports and anticipations, and the stuff put in for people who have nothing to think.”

~ Ralph Waldo Emerson, from his column 'Emerson Talks With a College Boy'

Knowledge needs freedom

"We all come into the world in ignorance of ourselves, and of everything around us. By a fundamental law of our natures we are all constantly impelled by the desire of happiness and the fear of pain. But we have everything to learn, as to what will give us happiness, and save us from pain. No two of us are wholly alike, either physically, mentally, or emotionally; or, consequently, in our physical, mental, or emotional requirements for the acquisition of happiness, and the avoidance of unhappiness. No one of us, therefore, can learn this indispensable lesson of happiness and unhappiness, of virtue and vice, for another. Each must learn it for himself. To learn it, he must be at liberty to try all experiments that commend themselves to his judgment… And unless he can be permitted to try these experiments to his own satisfaction, he is restrained from the acquisition of knowledge, and, consequently, from pursuing the great purpose and duty of his life."

~ Lysander Spooner, from his 1875 essay 'Vices Are Not Crimes' [hat tip Corey Massimino]

"The English ... value liberty because it is liberty."

"The English invented personal liberty without any theories about it. They value liberty because it is liberty."

~ Alexander Herzen, in Tom Stoppard's 2002 play The Coast of Utopia

Think ...

"Two percent of the people think, three percent of the people think they think, and nine-five percent of the people would rather die than think."

~ attrib. George Bernard Shaw