≡ Menu

Quotation of the Day…

… is from pages 78-79 of Jerry Evensky’s article “The Wealth of Nations,” which is chapter 5 in Ryan Patrick Hanley, ed., Adam Smith: His Life, Thought, and Legacy (2016):

[Adam] Smith believed that the Britain of his day was the most advanced nation in the world precisely because it had, through the serendipitous unfolding of chance, circumstance, and the intended and unintended consequences of individuals’ choices, established laws and institutions that protected individuals’ independence and security.  But he saw this British success at risk due to the influence of the self-serving principles of the mercantile system.

DBx: The “mercantile system” is, of course, what we today commonly call “protectionism” or “economic nationalism.”  By duping the general public into believing that the artificially promoted and protected profits and wages reaped by a handful of highly visible and politically powerful firms and workers are the same as – or are evidence of – a high standard of living for ordinary people nationwide, mercantilists convince members of the general public to accept government-imposed restrictions on their freedom to trade with foreigners.  More succinctly, protectionists pull off the rather amazing feat of convincing ordinary people that their standard of living rises when government artificially increases the scarcity of the goods and services that they wish to consume.