Private Prudence, Public Folly, by Adam Smith

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All of them find it for their interest to employ their whole industry in a way in which they have some advantage over their neighbours,* and to purchase with a part of its produce, or what is the same thing, with the price of a part of it, whatever else they have occasion for.

What is prudence in the conduct of every private family, can scarce be folly in that of a great kingdom. If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them with some part of the produce of our own industry, employed in a way in which we have some advantage. The general industry of the country, being always in proportion to the capital which employs it, will not thereby be diminished, no more than that of the above-mentioned artificers; but only left to find out the way in which it can be employed with the greatest advantage. It is certainly not employed to the greatest advantage, when it is thus directed towards [making] an object which it can buy cheaper than it can make.*

by Adam Smith 1723-1790

From ‘An Inquiry Into the Nature and Causes of the Wealth of Nations’, by Adam Smith (1723-1790).

* Smith does not mean an exploitative or fraudulent advantage, simply that a tailor has the advantage that he can make suits and a cobbler can’t, and a cobbler has the advantage that he can make shoes and a tailor can’t. And when it comes to farming, neither has the advantages a farmer enjoys.

* That is, when the Government forces us to spend our capital on making at home something that that could be bought more cheaply from abroad.

Précis

Wisely, said Smith, tradesmen make only what they have the skill to make, and buy other things from fellow tradesmen. A wise Government would do the same, and let the public buy from abroad what we don’t make well at home. This would put our earnings to work in the most efficient way, for ourselves and for the wider economy.

Questions for Critics

1. What is the author aiming to achieve in writing this?

2. Note any words, devices or turns of phrase that strike you. How do they help the author communicate his ideas more effectively?

3. What impression does this passage make on you? How might you put that impression into words?

Based on The English Critic (1939) by NL Clay, drawing on The New Criticism: A Lecture Delivered at Columbia University, March 9, 1910, by J. E. Spingarn, Professor of Comparative Literature in Columbia University, USA.

Précis

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