spectator. "When the happiness or misery of others depends in any respect on our conduct we dare not, as self-love would suggest to us, prefer the interest of one to that of many." And yet it is "not the soft power of humanity, it is not that feeble spark of benevolence which nature has lighted up in the human heart, that is thus capable of counteracting the strongest impulses of self-love. It is a stronger power, a more forcible motive which exerts itself on such occasions. It is reason, principle, conscience, the inhabitant of the breast, the man within, the great judge and arbiter of our conduct."1

The man within is the ideal of humanity; he is the true impartial spectator to whom the final appeal must be made. To this work on moral philosophy Adam Smith made some important additions just before his death in 1790. One passage is strangely pathetic: "It is only to the virtuous and humane that the infirmities of old age are not the objects of contempt and aversion. In ordinary cases, an old man dies without being much regretted by anybody. Scarce a child can die without rending asunder the heart of somebody." It was found on his death that his property was much less than had been expected, because he had given away the greater part in secret charity.

It may perhaps be thought a matter of little

1 The need for emphasising the moral philosophy of Adam Smith is shown by the following quotation from the Introduction to Byles's Sophisms of Free Trade signed by the editors W. S. Lilly and C. S. Devas: "No doubt Adam Smith regarded his political economy as a branch of his moral philosophy. But unfortunately his moral philosophy is in no true sense moral."-Op. cit.. Introduction, p. xviii, note.

importance in applying the ideas of Adam Smith to our present economic problems to show that he was not a "one-eyed flatfish with the side on which there is an eye always in the mud," but a man as keen in his appreciation of art and literature as his principal detractor-and with a far wider outlook and larger sympathies.

§ 3. Humanist and Nationalist.

Adam Smith had, no doubt, an exceptional genius for dealing with the economic side of human affairs, and he is rightly regarded as the founder of systematic political economy as distinct from the allied moral and social sciences; but his influence as an economist was enormously increased owing to his breadth of view, both moral and intellectual. Adam Smith was emphatically a great humanist, and that is the reason why, in treating of new economic problems, it is well to refresh our sympathies and sharpen our wits by a study of the master mind in this part of life. In particular we may learn of Adam Smith that questions of foreign trade require for their adequate discussion a reference to the great ideas of humanity and nationality as well as the more material interests of cheapness and plenty.

In the whole range of the history of perversions there is no more curious error than the popular idea that Adam Smith treated of the wealth of nations from the cosmopolitan standpoint, and that List, as opposed to Adam Smith, is the founder of national economy. If the two men are to be named by these

1

two names, then it is Adam Smith who must be ranked as the nationalist and List as the cosmopolitan. List had apparently taken his views of Adam Smith not from the original source but from the "school," and indeed it is to the "school" that he constantly refers. Most of his criticism, though valid as against the dogmas of the "school," is quite irrelevant as applied to the real Adam Smith. The nationalism of Adam Smith is so important that it is best treated in a separate chapter.

1 Cf. The National System of Political Economy by Friedrich List (edition Longmans, 1904). Introductory Essay by present writer, p. xiv.

CHAPTER II

THE NATIONALISM OF ADAM SMITH

§ 1. The Individual, the Family, and the Nation. IN the last edition of the Moral Sentiments, which was revised by the author just before his death, a new part was introduced,' which gives clearly his mature views on the relations of the individual to the family, the nation, and the world at large. The treatment of the family is interesting in connection with recent socialistic attacks, and gives a philosophical foundation to the common thought of the average Englishman. Adam Smith lays the greatest stress on the importance of the family relationships being intimate and continuous. The mere tie of blood is not enough. He goes so far, indeed, as to disapprove of the education of boys at distant great schools, and of young men at distant great colleges, a practice which he considered had hurt most essentially the domestic morals both of France and England. 'From their parents' house they may, with propriety and advantage, go out every day to attend public schools but let their dwelling be always at home.

1 Part vi.

Surely no acquirement which can possibly be derived from what is called a public education can make any sort of compensation for what is almost certainly and necessarily lost by it."

It is beyond the scope of the present inquiry to consider the validity of Adam Smith's general philosophical ideas; but the point is, that properly to understand his economics we must at any rate understand his attitude as regards the moral foundations of society. His individualism wears a different aspect if we remember that he was a passionate admirer of home and home life; and that on his view from the home as the centre the sympathies of the individual are extended through ever-widening circles of friends and acquaintances, until in this way the family is naturally linked with the state or nation.

"The state or sovereignty in which we have been born and educated and under the protection of which we continue to live is in ordinary cases the greatest society, upon whose happiness or misery our good or bad conduct can have much influence. Not only we ourselves, but all the objects of our kindest affections, our children, our parents, our relations, our friends, our benefactors, all those whom we naturally love and revere the most, are commonly comprehended within it; and their prosperity and safety depend in some measure upon its prosperity and safety. . . . When we compare it with other societies of the same kind we are proud of its superiority and mortified in some degree if it appears in any respect below them.

All