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More On Why Adam Smith Was No Protectionist

Here’s the fourth in my series countering Curtis Ellis’s attempt, at American Greatness, to justify protectionism.


You’ll forgive me for sending another letter as I continue to counter the fusillade of fallacies that is Curtis Ellis’s attempted defense of protectionism (“An American System for America Prosperity,” March 18).

Straining to portray Adam Smith as a protectionist, Ellis notes Smith’s worry that removing trade restrictions immediately might throw too many workers all at once into the ranks of the unemployed. The specter of this “disorder” did indeed lead Smith to concede that it might be better that “the freedom of trade should be restored only by slow gradations.” (Observe, by the way, that Smith’s ultimate goal here is the restoration of free trade.)

But Ellis fails to note that, immediately following this concession, Smith backtracked from it, arguing that this “disorder”

would in all probability, however, be much less than is commonly imagined…. [T]hough a great number of people should, by thus restoring the freedom of trade, be thrown all at once out of their ordinary employment and common method of subsistence, it would by no means follow that they would thereby be deprived either of employment or subsistence.

Smith then observed that there was no great “disorder” in Britain at the close of the Seven Years War when many men were suddenly released from the military into the civilian labor force. Smith believed this fact to be especially telling because discharged soldiers, in Smith’s view, are much less fit for new jobs in the market economy than are workers who’ve lost jobs to imports.

Smith ended his discussion of this point with a more fundamental argument:

The legislature, were it possible that its deliberations could be always directed, not by the clamorous importunity of partial interests, but by an extensive view of the general good, ought upon this very account, perhaps, to be particularly careful neither to establish any new monopolies of this kind, nor to extend further those which are already established. Every such regulation introduces some degree of real disorder into the constitution of the state, which it will be difficult afterwards to cure without occasioning another disorder.*

In short, Smith advised, don’t erect trade barriers to begin with. Smith’s advice here is precisely the opposite both of what Ellis advises, and what Ellis would have us suppose was offered by Adam Smith.

Donald J. Boudreaux
Professor of Economics
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030

* All quotations from Smith are from Book IV, Chapter II of An Inquiry Into the Nature and Causes of the Wealth of Nations (1776).

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