Functional socialism

CAPITAL 11S

Smith, in agreement with de Mandeville, is the result of natural instinct, which may not itself be virtuous but is bestowed upon us by Providence for the realization of ends beyond our ken.

LIBERAL POPE

Now the significance of Adam Smith’s conceptions of labour and capital is not that they are of enduring truth but that they were expressed at the formative period of the great industry. We must remember that he was not only the father of political economy but the Pope of the approaching Libertarian age. His disciples are found even to-day; during his own and the next two generations he was the Master. It was Schmoller, I think, who said that, after his death, political economy suffered from anemia. His contemporaries and successors might criticize this or that, but they were agreed that the main structure stood. In essentials, his is the political economy of the nineteenth century. We all know that his conception of labour is stated in terms that seem hopelessly at variance with his conception of capital. His critics have not been slow to point to what they regard as contradictions. I do not take that view; they are really the logical antinomies inherent in the economic life of his time. The opening sentence of his Wealth of Nations is as famous as the opening lines of Paradise Lost: “The annual labour of every nation is the fund which originally supplies it with all the necessaries and conveniences of life which it annually consumes, and which consists always either