The great paradox at the heart of Adam Smith’s genius

Is it fair to blame Adam Smith for the worst aspects of Victorian capitalism, or do we need to look deeper to understand him?

Adam Smith argued that we’re guided by an ‘impartial spectator’ and have the ability to judge our own and others’ behaviour (Getty)

Adam Smith’s reputation is paradoxical. He is celebrated as the author of The Wealth of Nations, perhaps the most significant work of political economy ever written, and yet at the same time held almost personally responsible for the worst aspects of Victorian capitalism.

In order to make a fair assessment of his thought, the proper starting point is his early essay on moral philosophy, Theory of Moral Sentiments.

In this work, he argued that while human beings are endowed with the capacity to reason, our behaviour tends to spring from instincts such as the impulse for self-preservation and sexual desires predicated upon the need to continue the species. Thus, he wrote of “hunger, thirst, the passion which unites the two sexes, the love of pleasure, and the dread of pain”. However, by putting instincts on the centre stage he immediately runs into a problem: where does morality come from? How do people form moral judgements, even about their own behaviour, indeed perhaps sometimes holding themselves to account?