Kimberly Gladman: Adam Smith walks into a bar

What would the ‘Father of Economics’‘ make of our current world?

He orders three fingers of Scotch, and the bartender hands him an empty glass.

“Well, look what the cat dragged in,” I say, striding up like I own the place (cos I do). This is the Great Books Bar & Grill, a watering hole of my imagination: old dead white guys come here to knock a few back with the living, and defend, if they can, what their ideas have brought us to.
“How’s capitalism?” Adam asks me. He’s all perky.
“We’re eating credit cards,” I say, which I figure is as good a start as any. I explain about the recent study that found the average person is ingesting 5 grams of plastic—a credit card’s worth—every week, due to the degradation of discarded plastic into microparticles suffusing our water and air. I also tell him how any minute now, someone’s going to attack that study’s methodology, and then there’ll be a lot of arguing about whether maybe it’s only a couple of swizzle sticks a week, or just a good-sized drinking straw. Then a lot of good, smart people will work very hard for a couple of years convening and multi-stakeholdering and figuring out different possible pathways under which, if Herculean efforts are made, the baby food eaten by my hypothetical future grandson could have various plastic/food (or food/plastic) ratios. Meanwhile, nobody knows what the hell all that plastic-eating is doing to our bodies, so even though alcohol’s a proven carcinogen, I intend to have some more of it. I flag the bartender down.
“A lot of people think it’s your fault,” I tell Adam.
He looks at me blankly, and I realize I’ve used a whole lot of words he doesn’t know. Like plastic, for starters, and credit cards; a lot has happened since he’s been dead. So I send him off for a mind-meld with our lead waitperson, Tavi, who has a knack for updating these old guys on modern life. Meanwhile I go off to reread his books.
The Wealth of Nations, it turns out, opens with a disparagement of the indigenous economies that I and a lot of other people are now thinking are our best models for sustainability. “The savage nations of hunters and fishers,” Smith says on page 1, are “miserably poor,” and often have to euthanize or abandon their old, sick, and young. (Old Adam clearly didn’t know a lot about indigenous cultures, and he never tried to get health insurance in America.) Then he moves on to giving a free pass to the idle rich. In “civilized and thriving nations,” he says, there is a non-working class whose members may “consume the produce of . . .a hundred times more labour” than the average worker. Still, the economy is so productive that even the poorest worker, if he is “frugal and industrious,” has a higher standard of living than a “savage.” (I suppose the question of standards is key: would you rather have cable TV, or unplasticized water?)
But for all Smith’s prejudices, his core insights are revelatory, which is what got him into the canon. High productivity, he says, results from the division of labor, which allows us to make lots of stuff fast (he just didn’t anticipate that our making and consuming ever more stuff would one day threaten civilization itself).He notes that private land ownership—another thing indigenous peoples lack—was the start of the core conflict in society, between a powerful, propertied class and the workers it employs. He explains that wages are higher when societies are increasing in wealth than when they are stable (but doesn’t consider that constant growth might be unsustainable), and he describes how employers regularly collude to keep wages down (even though, he says, you don’t hear about it the way you hear about workers’ rebellions). Employers’ goal is to keep wages at the minimum needed to allow workers to raise children to reproduce their labor; a minimum level he also calls “consistent with common humanity.”

At first, I’m thinking he didn’t realize how little common humanity people actually have. But then I look at his other major book, the Theory of Moral Sentiments, and he’s all over it. He goes on about how we have a hard time imagining the suffering of people if we don’t know them, or even sometimes caring about them when we do, and how our own self-interest is always uppermost and pretty short-term focused. (Which, it occurs to me, might have to do with the fact that we live in the economic system he described in Wealth of Nations.) Anyhow, by this time I feel sure that he’ll understand pretty quickly the pickle we’re in, once we bring him up to speed about the Earth: that its bounty isn’t inexhaustible, and that so much of it has been damaged or destroyed.
So I walk back to the bar, and see that Tavi’s printed Adam the main reports he needed to see, once he got up to date on the modern economy. He’s speed-reading through the IPCC one from last year about global heating, and the recent IPBES one about biodiversity loss. But he looks up at the TV when the news comes on, showing satellite images of the fires in the Amazon rainforest. The crawl at the bottom of the screen accelerates, in order to fill him in ASAP. World’s largest carbon sink imperilled by racist government; major biodiversity reservoir produces 20% of world’s oxygen. Investors claim fiduciary duty limits them to weak response; seek greater disclosure of corporate supply chains. Companies ponder whether/how to act; raise concerns re: bottom-line effects, obligations to shareholders. Meanwhile, the forest burns and burns and burns.
He looks back at me. And then Adam Smith begins to weep.

Kimberly Gladman, CFA, Ph.D. has directed research at Domini Social Investments, The Corporate Library/GMI, Just Capital, and the 50/50 Climate Project. You can connect with her on her blog.