Adam Smith and pollution

November 11, 2024 by Joshua
in Freedom

My book, Sustainability Simplified, approaches our environmental problems in several ways. One is from the view that government should stick to a few specific roles, one of which is to protect your life, liberty, and property from me taking or destroying it without your consent. A government that doesn’t protect life, liberty, and property leads to a nation without hope for a better future, which leads to people retreating to what they can protect themselves.

Other approaches include to see that imperialism resulted from unsustainability and led to colonialism, slavery, and racism. If we want to end the downstream effects of imperialism, colonialism, slavery, and racism, any solutions will only be temporary unless we stop the upstream causes. For this post, though, I’ll focus on the free market approach.

I quote John Locke, Milton Friedman, Friedrich Hayek, Frederic Bastiat, and a few others, but only refer to Adam Smith through them. Today, I’ll quote his three passages that seem most relevant to me.

Adam Smith The Wealth Of Nations

First, his Theory of Moral Sentiments describes how society depends on justice. The next quotes will clarify what he means by justice. This quote says that being beneficent and virtuous is nice, but if society is a building, the whole structure rests on justice. Without justice, everything falls apart.

Tho’ nature, therefore, exhorts mankind to acts of beneficence, by the pleasing consciousness of deserved reward, she has not thought it necessary to guard and enforce the practice of it by the terrors of merited punishment in case it should be neglected. It is the ornament which embellishes, not the foundation which supports the building, and which it was, therefore, sufficient to recommend, but by no means necessary to impose. Justice, on the contrary, is the main pillar that upholds the whole edifice. If it is removed, the great, the immense fabric of human society, that fabric which to raise and to support seems in this world, if I may say so, to have been the peculiar and darling care of nature, must in a moment crumble into atoms. To enforce the observation of justice, therefore, nature has implanted in the human breast that consciousness of ill-desert, those terrors of merited punishment which attend upon its violation, as the great safe-guards of the association of mankind, to protect the weak, to curb the violent, and to chastize the guilty.

In The Wealth of Nations he expands that even without promoting beneficence or anything else, a government maintaining justice (plus peace and easy taxes) is enough for a state to realize its greatest opulence. Moreover, trying to do more results in oppression and tyranny.

Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes, and a tolerable administration of justice; all the rest being brought about by the natural course of things. All governments which thwart this natural course, which force things into another channel, or which endeavour to arrest the progress of society at a particular point, are unnatural, and to support themselves are obliged to be oppressive and tyrannical.

What is justice for Adam Smith?

If a government needs only implement justice (plus peace and easy taxes) to reach its greatest potential, what does Smith mean by justice? He clarifies it in The Theory of Moral Sentiments. The violation of justice is injury. I understand him to mean that justice means preventing injury, which seems to me effectively: to protect life, liberty, and property.

There is, however, another virtue, of which the observance is not left to the freedom of our own wills, which may be extorted by force, and of which the violation exposes to resentment, and consequently to punishment. This virtue is justice: the violation of justice is injury: it does real and positive hurt to some particular persons, from motives which are naturally disapproved of. It is, therefore, the proper object of resentment, and of punishment, which is the natural consequence of resentment.

My Conclusion

I understand Adam Smith to say, prior to everything about what a free market can achieve, that free market can only exist if government protects life, liberty, and property. Without it doing so, everything later is a building with no foundation.

How tall do you want to let a building grow without a foundation? How big a crash are you willing to see happen?

Pollution destroys life, liberty, and property. A government that allows pollution is allowing its citizens to build a structure with no foundation, liable to collapse. Smith writes more about what happens when people don’t expect justice. It’s not pretty.

You might say, “But we’ve built so much. Do you want to risk it all? We like the heights we’ve reached. What if we can’t reach them again without polluting?”

First, Smith couldn’t be more clear on the inevitability of such a structure leading to tyranny. Second, I don’t have to worry about demonstrating to people who agree with Smith on the potential of a market based on justice. A market based on justice will reach a greater potential than one without.

Corroboration

Toward the end of Wealth of Nations, he describes a “system of natural liberty.” In that system he describes how everyone can do what he or she wants as well as the role of government. Note that the liberty he describes doesn’t anyone can do anything. He clarifies “as long as he does not violate the laws of justice.” Moreover, the state does have some duties, and one is to protect, “as far as possible, every member of society from the injustice or oppression of every other member of it.”

Smith didn’t have to include these restrictions. Beyond including “as long as he does not violate the laws of justice,” he puts that clause before describing a person “left perfectly free to pursue his own interest his own way.”

In other words, as I understand him, Smith sees government protecting citizens from others harming them as prior to a market. Therefore, as long as government allows polluting, we cannot reach liberty. Government allowing polluting prevents liberty.

All systems, either of preference or of restraint, therefore, being thus completely taken away, the obvious and simple system of natural liberty establishes itself of its own accord. Every man, as long as he does not violate the laws of justice, is left perfectly free to pursue his own interest his own way, and to bring both his industry and capital into competition with those of any other man, or order of men. The sovereign is completely discharged from a duty, in the attempting to perform which he must always be exposed to innumerable delusions, and for the proper performance of which, no human wisdom or knowledge could ever be sufficient; the duty of superintending the industry of private people, and of directing it towards the employments most suitable to the interests of the society.

According to the system of natural liberty, the sovereign has only three duties to attend to; three duties of great importance, indeed, but plain and intelligible to common understandings:

  • First, the duty of protecting the society from the violence and invasion of other independent societies;
  • Secondly, the duty of protecting, as far as possible, every member of the society from the injustice or oppression of every other member of it, or the duty of establishing an exact administration of justice; and,
  • Thirdly, the duty of erecting and maintaining certain public works, and certain public institutions, which it can never be for the interest of any individual, or small number of individuals to erect and maintain; because the profit could never repay the expense to any individual, or small number of individuals, though it may frequently do much more than repay it to a great society.

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