Two anniversaries, one lesson: Adam Smith and the making of America
Last week's fireworks marking 250 years since the Declaration of Independence rather overshadowed a quieter, but arguably no less consequential, anniversary: the publication of Adam Smith's Wealth of Nations, which appeared in London on 9 March 1776, a full four months before Jefferson's document crossed the Atlantic. A sharp new paper from Samuel Gregg at AIER, Economist and Revolutionary, makes the case that these two texts were never quite as separate as the textbooks suggest.
Gregg's central claim is that Smith functioned, in effect, as an early analyst of Anglo-American relations rather than merely an abstract theorist. Books IV and V of the Wealth of Nations are saturated with commentary on the colonial crisis, and Smith went further still in a 1778 memorandum, written at the request of the Solicitor-General after Saratoga, sketching out how Britain might extract itself from a war it was steadily losing.
What's striking is how thoroughly economic Smith's diagnosis was. He traced the breakdown in Anglo-American relations to the mercantile system: the tariffs, the Navigation Acts, the East India Company's political muscle in Westminster. His preferred fix wasn't independence at all but full imperial union — American representation in Parliament, shared responsibility for the national debt, free trade across the empire. Only once that proved politically unworkable did Smith conclude, with evident reluctance, that separation was the more sensible course for both parties.
There's an obvious contemporary resonance here, and Gregg doesn't shy away from drawing it out. Protectionism still distorts our sense of the national interest; cronyism still dresses itself up as patriotism; interventionist agendas still generate friction between allies who ought to know better. Two hundred and fifty years on, the argument that got Smith "virulently abused" by his own contemporaries — that trade barriers enrich the connected few at everyone else's expense — remains as necessary, and in some quarters as unwelcome, as it ever was.
Worth a read before the bunting comes down.
Viggo Terling
