Toward a Practical Justice Part 2: Adam Smith’s Moral and Economic Psychology

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Since Hayek’s concept of justice is insufficient, we have to turn no farther than the grandfather of modern economics for a richer understanding of justice and morality that I believe does stand the pragmatic test. In Adam Smith’s first book, The Theory of Moral Sentiments (TMS), he uses the word justice with multiple interconnected meanings.

When brought together these create a moral guide that fulfills both the demand that justice be a practical guide to individual conduct and the higher senses of justice that “social justice” usually tries to satisfy. To talk about justice in Smith, we need first to understand his moral psychology.

To Smith, human life is made up of sentiments towards various people, actions, and objects. These sentiments are developed through experience. We are born with the natural instinct to care for our own pleasure and pain. Through life, we develop a concern for the well-being of those around us such as our family and neighbors, and further we may develop a love for mankind as a whole. Since these outward developments occur so regularly, Smith feels no hesitation to also call them natural sentiments. Our sentiments develop with someone more intimately the closer they are.  There is a “sympathetic gradient” that develops with ourselves at the center and our attachments growing colder as the distance between us and another increases. Sentiments can be built for concrete objects and people or abstract patterns. Sentiments about human conduct we call moral sentiments.

But sentiments in the moment can deceive. Imagine someone sitting in front of you, perhaps a friend that you habitually end up in debates with. In the heat of the moment, when something that they say brings you past the boiling point, is it not natural to want to call them the first nasty name you can think of? Afterwards, remorse usually sets in, and any cool-headed bystander would disapprove of such behavior, no matter how reprehensible the opinion of the victim. Smith says, “This self-deceit, this fatal weakness of mankind, is the source of half the disorders of human life” (TMS 158). Our moral faculties have not left us unarmed against this weakness. “Our continual observations upon the conduct of others, insensibly leads us to form ourselves certain general rules concerning what is fit and proper either to be done or to be avoided” (TMS 159). To make sure our sentiments don’t lead us to disastrous decisions in the heat of the moment, we develop sentiments for general rules of conduct. These general rules help moderate our behavior and temper our partiality.

Smith’s famous example of the Chinese earthquake explains best (TMS 136-37). If a man in Europe is informed of an earthquake that swallows up all of China he may express sympathy, but ultimately it will not affect his sleep that night. If he is informed that the next day he will lose his pinky, that night will be one of the longest of his life. The example demonstrates clearly the sympathetic gradient. China is much farther from me than the two fingers I have resting on “A” and “;” as I type this sentence. Even though that may be the case, if anyone was given the choice between keeping their pinky and saving one billion people, most would make the sacrifice. How can this be the case if they have already confessed a greater attachment to their finger? There is a third inner force at work. Their devotion to the general rule that they must sacrifice what is only a “paltry misfortune” to themselves for the good of an “immense multitude” makes the choice an easy one. The rule saved this poor soul from the blindness of his own partiality.

Another similar tale that Smith tells is of the policy maker. Economic policy is laid out for the well-being of the people, but the policy maker rarely has an intimate relationship with each member of the population their policy will affect, both in terms of personal affection and situational knowledge. “…if you would implant public virtue in the breast of him who seems heedless of the interest of his country, it will be to no purpose to tell him, what superior advantages the subjects of a well-governed state enjoy…You will be more likely to persuade, if you describe the great system of public police [policy] which procures these advantages,” (TMS 186) Smith is appealing to economists. The love of political and economic systems can prompt even the most cold-hearted to work towards the betterment of others.

It is still important to remember that Smith believed that these rules and systems were “ultimately founded upon experience of what, in particular circumstances, our moral faculties…approve or disapprove of” (TMS 159). The general rules grow out of a deeper soil of natural sentiment. They can change over time as experiences accumulate and traditions evolve. They are still respected as rules in themselves, but their purpose remains to adjust people to pursue higher goals and protect them from self-deceit.

If the respect for rules or love of systems gets in the way of those higher goals, we run into the infamous man of system. The man of system may admit partiality in others, but out of “his own conceit” believes the system he has fallen in love with, or the rules that he has developed, trump all others.

“He seems to imagine that he can arrange the different members of a great society with as much ease as the hand arranges the pieces upon a chessboard. He does not consider that the pieces upon the chessboard have no other principle of motion besides that which the hand impresses on them”

Theory of Moral Sentiments pg. 234

We have a level of intimacy with chess pieces that we do not have with the members of a great society. Systems that ignore other forces will lead to disorder. The intimacy that the man of system fails to have is not always one of affection, but also that of situational knowledge. No single system can contain all the “particulars of time and place” that Hayek speaks of in “The Use of Knowledge in Society”.

Next week I’ll show how Adam Smith’s moral psychology reflects upon his broader and more encompassing sense of justice.

Bibliography:

  • Hayek, Friedrich. (1945) “The use of knowledge in society.” The American economic review 35, no. 4: 519-530.
  • Smith, Adam (1759) The Theory of Moral Sentiments. Liberty Fund.
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