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Adam smith invisible hand quotes8/30/2023 ![]() Many Continental and imperial wars between European powers were fought over the dogmatic articles of mercantilist faith, including the Anglo-Dutch Wars fought over the Navigation Act of 1651, which were designed to boost English trade interests at the expense of the Netherlands. The emphasis on natural resources including cash crops, lumber, and iron fueled imperial expansion to secure the raw materials necessary for domestic industry to manufacture goods for export on the burgeoning world market. The value placed on gold in particular, was the impetus spurring the Spanish to pillage as much gold from the Americas as possible, encouraging brutal conquest while simultaneously causing immense inflation in European markets in the process. Consequently, in the pre-capitalist societies of early-modern Europe, wealth was measured in gold holdings and natural resources, not gross domestic product. ![]() For a country to be deemed wealthy in a mercantile economy, it must operate under a trade surplus, rather than a deficit-and thus nations work to achieve a trade surplus and in doing so war with one another instead of working together by exchanging goods based off of their own unique natural resources. ![]() ![]() Propagated subversively with avaricious intent, the fallacious doctrine of balanced trade viewed wealth as finite rather than unlimited. Mercantilist Doctrines Lead to Calamity for All But the FewĬentral to mercantilist notions of trade was the concept of balanced trade, which has once again come to the forefront in our own time. The Dutch East India Company was another example of the mercantilist joint-stock company, which was in essence a public/private conglomerate, granted exclusive monopolies over trade in certain regions and given special legal status and protections. Initially backed militarily and subsidized financially by the British Empire, the British East-India Company was a multi-national monstrosity like few others. In the name of trade, the East India Company carried out a multitude of atrocities across the region, inciting wars to traffic drugs via its own private army-even leading to the usurpation of sovereign nations, as was the case in India. Perhaps the quintessential example of the repugnance of mercantilism was the British East-India Company and its doings in the Orient. A historical case-study reveals a plurality of horrific byproducts of the mercantile system during the age of empires and colonialism. A precursor to the more liberal market economies of the 19th century, mercantilism was a system in which merchants and bankers were the “chief architects of public policy,” as Adam Smith noted in his critique of the economic system. ![]() When reading Smith however, one is confronted with the startling fact that his ideas have been misconstrued and adulterated.Īdam Smith opened his Inquiry Into the Nature and Causes of the Wealth of Nations by declaring that it “was an attack on the whole commercial system of modern Europe.” Specifically, Smith’s seminal work was an attack on the political and economic system known as “mercantilism.” Mercantilism, derived etymologically from the French word for merchant, was the dominant economic system of early-modern Europe. Long heralded as a proponent of self-regulating markets, limited government, and free-market “capitalism,” Smith is often invoked by proponents of corporate capitalism as an archetype of reason, worthy of reverence. Adam Smith, the father of the discipline we now refer to as economics, was a moral and political philosopher of the Scottish Enlightenment and contemporary and acquaintance of Edmund Burke. ![]()
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