Smith’s critique of this system was to be notable for its sensitivity to the practicalities of installing it as well as to its economic thinking.42 Apart from the revolutionary act of state that would be needed to create a new and obviously deeply controversial tax system, the project hinged on the assumption that the stimulus of the single tax would be enough to turn the French landowning class into a class of efficient agricultural improvers – a proposition which Smith with his long-standing lack of faith in the redeeming qualities of the Scottish nobility found hard to credit. All he was prepared to grant was that ‘The class of proprietors [would contribute] to the annual produce by the expence which they may occasionally lay out upon the improvement of the land’43 (my italics). Smith was struck even more forcibly by the narrow rigidity of Quesnay’s system, which was like those concocted by ‘speculative physicians’ (like Quesnay himself), who claimed that ‘the health of the human body could be preserved only by a certain precise regimen of diet and exercise, of which every, the smallest, violation necessarily occasioned some degree of disease or disorder proportioned to the degree of the violation’.44 This critique, which must have taken shape in Paris, went to the heart of his disagreements with the French and reinforced his view that modern French thinking, for all its ingenuity, was seriously lacking in an understanding of the principles of human nature and, above all, the importance of pursuing policies that aimed at the progressive improvement of a country’s institutions rather than by revolutionary acts of state.
[Quesnay] seems not to have considered that in the political body, the natural effort which every man is continuously making to better his own condition, is a principle of preservation capable of preventing and correcting, in many respects, the bad effects of a political oeconomy, in some degree, both partial and oppressive. Such a political oeconomy, though it no doubt retards more or less, is not always capable of stopping altogether the natural progress of a nation towards wealth and prosperity, and still less of making it go backwards. If a nation could not prosper without the enjoyment of perfect liberty and perfect justice, there is not in the world a nation which could ever have prospered. In a political body, however, the wisdom of nature has fortunately made ample provision for remedying many of the bad effects of the folly and injustice of man; in the same manner as it has done in the natural body, for remedying those of his sloth and intemperance.45
In the Wealth of Nations Smith went on to demonstrate the analytical power of the principle of improvement. The capital error of Quesnay’s system was that it described the labour of artisans, manufacturers and merchants as essentially unproductive, resembling that of domestic servants in that it only ‘reproduces annually the value of its own annual consumption’. But artisans, manufacturers and merchants did, after all, produce ‘vendible’ commodities and the labour that produced them added to the total stock of labour and capital of a country by virtue of the extra demand it created. Nor was it true that the revenue derived from agriculture was necessarily greater than the revenue generated by trade and manufactures, for the fundamental reason that the progress of the division of labour and the progress of improvement would always be slower in agriculture than in manufacturing. These were criticisms based on conclusions that were fundamental to Smith’s thinking and may even have dated back to his Edinburgh lectures, that systems of political economy which were designed to favour either commerce or agriculture were equally flawed as means of maximizing the opulence of a nation. The task of political economy was to reflect on the means of giving effect to a genuinely liberal system which, so far as was possible, would remove the obstacles to free trade in both the agricultural and manufacturing sectors of the economy.
In all of this, Smith was returning to the wider questions about the relations between country and town, agriculture and commerce he had raised in Glasgow, and may well have been better able to resolve as a result of his encounters with the économistes. After all, by the time he left Glasgow he had developed his discussion of commerce to the point that he had been able to ask why this most beneficent of practices had developed so slowly in Europe, and had answered with an analysis of the malign and complex effects of the feudal system on the progress of agriculture and the division of labour. In the Wealth of Nations he was to describe this progress as ‘retrograde and unnatural’, and as Istvan Hont suggests, it is likely that he learned from Mirabeau’s Rural Philosophy (and presumably from conversation with Mirabeau himself) exactly why it was so and why exactly the économistes’ system was so dangerous.46 Like Smith and many others, Mirabeau viewed the progress of opulence as a natural progress from hunting to herding and agriculture, and he viewed the origins and progress of commerce as the natural consequence of the history of agriculture in its more advanced state of development. ‘Thus alongside the agricultural societies there could be, and were bound to be, set up commercial societies, just as granaries are set up alongside crops.’47 Colbert’s attempt to turn France into a great trading and manufacturing nation by means of a tax system that favoured manufactures at the expense of agriculture was thus a perverse attempt to obstruct the course of nature which the économistes proposed to reverse by means of an act of state. By the time he came to write the Wealth of Nations Smith had come to see that, although this course of development could be regarded as ‘natural’ and ‘beneficial’, it did not describe the actual progress of commerce in modern Europe, and did not take account of the malign effects of the feudal system or of the history of war, exploration and luxury that had turned towns into little republics rather than the ‘granaries’ or comptoirs of Mirabeau’s analysis, and it may well be that his discussions in Paris in 1766 led him to this conclusion. If so it would have been in Paris that Smith came to realize fully that the task of political economy was to show how states which owed their origins to such unnatural and retrograde causes should be managed.
By the summer of 1766, however, Smith’s sojourn in Paris had begun to run its course. News had reached Smith and Buccleuch that the Duke’s friend Macdonald of Sleat, who had joined them in Toulouse, had died in Rome, a loss which prompted Hume to write, ‘Were you and I together Dear Smith we shoud shed Tears at present for the Death of poor Sir James Macdonald. We coud not possibly have sufferd a greater Loss than in that valuable young Man.’48 Worse was to follow. In late August Buccleuch went down with a fever and what sounds like food poisoning while visiting the Court at Compiègne. In spite of his protestations, Smith was worried enough to send for Quesnay as the king’s physician and two other doctors. He sent Townshend a meticulously detailed and precise account of the progress of the Duke’s illness, assuring him ‘I never stirr from his room from eight in the morning till ten at night, and watch for the smallest change that happens to him. I should sit by him all night too, if the ridiculous, impertinent jealousy of Cook [Buccleuch’s servant] who thinks my assiduity an encroachment upon his duty, had not been so much alarmed as to give some disturbance even to his master in his present illness.’49 It was the same sort of assiduous care he had shown during Thomas Fitzmaurice’s illness at Glasgow.
By then Smith was ready to go home. He told the publisher Andrew Millar that
Tho I am very happy here, I long passionately to rejoin my old friends, and if I had once got fairly on your side of the water, I think I should never cross it again. Recommend the same sober way of thinking to Hume. He is light-headed, tell him, when he talks of coming to spend the remainder of his days here, or in France. Remember me to him most affectionately.50
It sounds as though he had got what he wanted from Paris and was ready to write. One would guess that the Duke had had enough as well. What settled the matter was the sudden illness and death of Buccleuch’s brother Campbell Scott in Paris on 19 October. Scott had fallen ill with a fever, vomiting and delirium. Smith reported that Quesnay had been called in (‘one of the worthiest men in France and one of the best Physicians that is to be met with in any country’), as had Théodore Tronchin (‘my particular and in
timate friend’), but to no avail. He had gone to the Embassy to tell Buccleuch that his brother was dying and had returned to find that he had died five minutes earlier. ‘I had not the satisfaction of closing his eyes with my own hands. I have no force to continue this letter; The Duke, tho’ in very great affliction, is otherwise in perfect health.’51 The stay in Paris was instantly aborted. By about mid-November Smith and Buccleuch had returned home with Campbell Scott’s body. It was the end of Smith’s first and only visit to Europe.
10
London, Kirkcaldy and the Making of the Wealth of Nations 1766–76
Campbell Scott’s death in October 1766 had brought Buccleuch’s European tour to an abrupt end. But although Smith had told Millar a few weeks earlier that he was anxious to get home, he was to remain in London until the spring of 1767. Why he did so is not clear, although it seems likely that he was under some sort of obligation to Buccleuch and Townshend. The Duke was to enter his majority in September 1767 and it may well be that his stepfather wanted Smith’s help in preparing his stepson to take over the management of his enormous estates in Scotland. At this stage Townshend still expected Buccleuch to enter politics and to follow the family practice of making one of his English houses his principal residence, running his estates from London through the elaborate system of devolved management that had evolved during the previous century. Townshend himself was a keen agricultural improver, and knowing Smith’s views on the importance of agricultural improvement to a nation’s wealth and its nobility’s greatness it is possible that this was when discussions with Smith about the future management of the estates began.1
Townshend may also have had other reasons for wanting Smith to be on hand. He had been appointed Chancellor of the Exchequer in Lord Chatham’s new ministry and his primary task was to bring the public finances under control in the aftermath of the Seven Years War. He had consulted Smith over taxation policy when he was still in France, and he consulted him again in the autumn of 1766 about his plans for a new sinking fund to bring the national debt under control. A paper on the subject was sent to Smith for comment, with the request to ‘speak … upon every part of this memorial (for I cannot call it a letter) without reserve and pitty’.2 Smith’s comments are unfortunately missing. But Campbell and Skinner are probably right to suggest that the political turmoil into which this most erratic of politicians was plunged in the autumn of 1766, together with the alarming financial crisis precipitated by the affairs of the East India Company, left little time or opportunity for serious consideration of the principles of taxation.3
Whether or not this explains Smith’s five-month stay in London, his time was clearly fully occupied. He was able to move in political circles at a time when the future of Anglo-American relations, the role of the East India Company in the government of India and public finance and taxation were under discussion, all matters of importance to the Wealth of Nations. Lord Shelburne, now a Secretary of State, asked him for information about the colonial policies of the Romans and was given a surprisingly perfunctory reply.4 He was known at the Royal Society – whose President, Sir John Pringle, was a Scot – and was elected a Fellow in May 1767. He had access to the enviable resources of the recently opened British Museum. He would have undoubtedly made a point of visiting the British Coffeehouse, off Charing Cross, the regular resort of Scots in London. And it was a convenient time to see the third edition of the Theory of Moral Sentiments, with the addition of the ‘Dissertation on the Origin of Languages’, through the press. It was published that same year. Smith returned to Kirkcaldy in May 1767 preceded by four large cases of heavily insured books, and remained there until 1773. It was there that most of the Wealth of Nations was drafted.
Settling in Kirkcaldy came as a great relief. The burgh was far enough from Edinburgh and Glasgow to provide peace and quiet, and his mother’s domestic regime provided order and security. Old school friends who had settled nearby offered the prospect of congenial and undemanding company. It was the right place to work on a demanding book. And for relaxation, he told Andreas Holt, it gave him the opportunity of studying botany ‘(in which however I made no great progress) as well as some other sciences to which I have never given much attention’.5 As he told Hume in June, ‘My Business here is Study in which I have been very deeply engaged for about a Month past. My Amusements are long, solitary walks by the Sea side. You may judge how I spend my time. I feel myself, however, extremely happy, comfortable and contented. I never was, perhaps, more so in all my life.’6 It was said that one of those long solitary walks took the form of a fifteen-mile trek to Dunfermline wrapped in thought and clad in a dressing gown, and only brought to an abrupt conclusion by the sound of the town’s church bells.7 And while Hume was able to provide Smith with news and gossip from the outside world, he constantly complained that he saw too little of him. A teasing, witty and affectionate letter proposing a trip to Edinburgh was written more in hope than in expectation of a visit.
James’s Court, Edinburgh, 20 Aug. 1769
Dear Smith
I am glad to have come within sight of you, and to have a View of Kirkaldy from my Windows: But as I wish also to be within speaking terms of you, I wish we coud concert measures for that purpose. I am mortally sick at Sea, and regard with horror, and a kind of hydrophobia the great Gulph that lies between us. I am also tir’d of travelling, as much as you ought naturally to be, of staying at home: I therefore propose to you to come hither [to Edinburgh], and pass some days with me in this Solitude. I want to know what you have been doing, and propose to exact a rigorous Account of the method, in which you have employed yourself during your Retreat. I am positive you are wrong in many of your Speculations, especially where you have the Misfortune to differ from me. All these are Reasons for our meeting, and I wish you woud make me some reasonable Proposal for the Purpose. There is no Habitation on the Island of Inch-keith [halfway across the Firth of Forth]; otherwise I shoud challenge you to meet me on that Spot, and neither [of] us ever to leave the Place, till we were fully agreed on all points of Controversy. I expect General Conway here tomorrow, whom I shall attend to Roseneath, and I shall remain there a few days. On my Return, I expect to find a Letter from you, containing a bold Acceptance of this Defiance. I am Dear Smith Yours sincerely
David Hume8
The young Duke of Buccleuch was the only person allowed to interrupt Smith’s retreat and Smith’s desultory correspondence suggests that he was perfectly content for him to do so. The sudden death of Townshend on 4 September put an end to the plan to draw Buccleuch into the ‘vortex of Politics’ and run his affairs from London. He chose Dalkeith House outside Edinburgh as his new centre of operations, extensively modernized it and prepared to celebrate his coming of age and his recent marriage to Elizabeth, daughter of the Duke of Montagu, before getting down to the business of taking over his estates. Smith was invited as a friend and mentor to the young couple. Buccleuch’s introduction to local society does not seem to have been a conspicuous success. According to Carlyle, ‘The Fare was Sumptuous, but the Company was formal and Dull. Adam Smith their only Familiar at Table, was but ill qualifi’d to promote the Jollity of a Birthday, and Their Graces were quite unexperienc’d.’9 But Smith stayed at Dalkeith for two months, his longest absence from his Kirkcaldy retreat before 1773; it was the first of many such visits there he was to make for the rest of his life. For he became a lifelong family friend, a replacement for Townshend, someone who saw eye to eye with his former pupil on questions of estate management and had a far more palatable view of the role of great landowners in public life than his former patron.
The task of reviving the Buccleuch estates was formidable. Townshend had borrowed heavily – some said embezzled – on the credit of the estate, leaving it with serious cash-flow problems.10 The estates were enormous; those in the so-called South Country of Ettrick, Teviotdale and Liddesdale alone consisted of 439 farms with an annual rental of £19,074. All were leased to tenants whose leases had t
o be reissued on the Duke’s majority. The estate itself was heavily entailed, making the issue of the long leases that Smith, Buccleuch and every improver believed essential to encourage agricultural improvement, impossible. Whether or not Smith was involved in early discussions about the future of the estate in 1766, he was certainly involved in the relaunch in the autumn of 1767, and almost certainly in plans for securing the legislation needed to allow the entail to be eased, a complicated and protracted business which was only brought to a conclusion with legislation in 1770. One of his favourite Glasgow pupils, the advocate Ilay Campbell, was to be the Duke’s prime legal adviser. It is inconceivable that he and Smith were not involved in discussing and drafting the remarkable advertisement that appeared in the Edinburgh Advertiser of 20 October, calling for applications for leases on the Duke’s South Country estates. Prospective tenants were asked to state the length of the lease they wanted, to explain the sort of improvements they wished to bring about, to estimate the amount the Duke was expected to pay to finance them, and to state the rent they were prepared to offer. It was a remarkable exercise in encouraging agricultural improvement which bears all the marks of Smith’s thinking, and swept aside alternative, more cautious plans proposed by other advisers. This ‘General Sett’ was conspicuously successful – half of the proposals coming from existing tenants, half from strangers, many from England. As Brian Bonnyman has put it, ‘it was an explicit attempt to expose the land to the competition of the market’,11 and although the problems involved in implementing the plan were far from straightforward it seems likely that Smith was kept in close touch with them on his frequent visits to Dalkeith.
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