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Marxists have made much of this "alienation" theme (as they have christened it), without, however, attending to Smith's proposal to prevent, or at least mitigate, it. Marx himself, after quoting that passage in Capital, referred to this proposal as providing "education of the people by the state, but prudently, and in homoeopathic doses". The alternative measure he himself put forward might strike a modern reader as not so much prudent or homoeopathic as simply regressive. Writing almost a century after Smith, only a few years before the Forster Act of 1870 that established the principle of free, compulsory public education, Marx took as his model for educational reform the Factory Act of 1864, which permitted children under the age of 14 to work only if they spent part of the day at schools provided by the employer. Although he criticised that measure as "paltry", he approved of the principle of combining education with work, accepting the claim of factory inspectors that these children, in far fewer hours, learned as much or more than day-school children. His own proposal was heavily weighted toward work. "When the working class comes into power, as inevitably it must, technical instruction, both theoretical and practical, will take its proper place in the working class schools", making workers fit for a "variety of labours, ready to face any change of production". This was no passing thought on Marx's part. Almost 20 years earlier, in The Communist Manifesto, he derided the "bourgeois claptrap" about education, proposing instead free education with the proviso: "combination of education with industrial production."

Apart from the belated appearance of this pessimistic theme, the tone of The Wealth of Nations is notably optimistic. A flourishing economy is not only the precondition for the material improvement of the people; it also fulfills their natural desire for "betterment", a desire that "comes with us from the womb, and never leaves us till we go into the grave". Perhaps more important, it promotes liberty and good government. "Commerce and manufactures gradually introduced order and good government, and with them, the liberty and security of individuals, among the inhabitants of the country, who had before lived almost in a continual state of war with their neighbours and of servile dependency upon their superiors." Smith credited Hume with calling attention to this beneficent aspect of industrialism: its civilising, moderating, and pacifying effect on the people, on society, and on government itself.

Beyond material improvement, beyond even liberty, security, and tranquility, perhaps the most remarkable aspect of The Wealth of Nations is its democratic character. Smith used the conventional words to describe what we now call the working classes: "lower ranks (or orders)", "the common people", "the labouring poor", or, simply, the "poor". But it is the functional, rather than the hierarchic, nature of the three orders of society that concerned him. His classes are defined by the source of their income: rent, wages, and profit. And wage earners, or labourers, constitute not the third order, as was customary at the time (and still is in general discourse), but the second order, taking precedence over merchants and manufacturers who are the third order. The labourer is a full partner in the economic enterprise, indeed, the most important partner, because labour is the source of value. Moreover, labour, like rent and profit, is a "patrimony", a form of property entitled to the same consideration as any other kind of property.

The patrimony which every man has in his own labour, as it is the original foundation of all other property, so it is the most sacred and inviolable. The patrimony of a poor man lies in the strength and dexterity of his hand; and to hinder him from employing this strength and dexterity in what manner he thinks proper without injury to his neighbour is a plain violation of this most sacred property.

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Roy Lisker
July 8th, 2012
2:07 PM
I'd thought that this problem was solved by Gerard DeBreu in 1984. That's why he received the Nobel Prize in Economics

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