Saturday, 19 November 2011

Viner on Smith on government

The standards of honesty and competence of the governments of his day with which Smith was acquainted were unbelievably low, moreover, not only in comparison with what they are today in England, Germany, and the Scandinavian countries, but apparently even in comparison with earlier periods in English political history. Smith had encountered few instances in which government was rendering intelligent and efficient service to the public welfare outside of the fields of protection and justice. The English government of his day was in the hands of an aristocratic clique, the place-jobbing, corrupt, cynical, and classbiased flower of the British gentry, who clung to the traditional mercantilism not so much because of a strong faith that it met the problems of a growing trade struggling to burst its fetters, but because they did not know anything else to do. Even when Smith was prepared to admit that the system of natural liberty would not serve the public welfare with optimum effectiveness, he did not feel driven necessarily to the conclusion that government intervention was preferable to laissez faire. The evils of unrestrained selfishness might be better than the evils of incompetent and corrupt government. (Jacob Viner, "Adam Smith and Laissez Faire", Journal of Political Economy, Vol. 35, No. 2 (Apr., 1927), pp. 198-232.)
How much have things really changed since Smith's time?

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