Skepticism about the political viability of the extreme left’s proposals is well founded. It’s not due to what they propose so much as their inability to understand that the policies they propose are not socialism. Nor are those social programs they claim were socialist, like Social Security, Medicare etc.
In example, Social Security was a government mandated savings program that had nothing to do with government ownership of the means of production and distribution. In fact, none of the government programs we call entitlements or welfare are socialist. The political right only argues that they are, and our current headline grabbing “socialists” don’t have the sense to cast their proposals as what they are, sound capitalist policy.
Many liberals even cast blanket aspersions against capitalism, little realizing that Adam Smith’s opus, The Wealth of Nations (short title), was a work of moral philosophy that was critical of greed, and championed raising the condition of the working poor.
So, let’s get something straight. Social programs are not socialism. They could be initiated by a monarchy if it so moved the monarch. Saying they are socialist virtually admits that the rhetorical argument of the right is true. If people better understood economics, they would be seen for what they are: A good faith effort to alleviate societal problems through Keynesian economics.
In example, the nonpartisan Center on Budget and Policy Priorities (CBPP) issued a report a few years ago on their finding that each dollar of transfer payments (PDF – SNAP) returned as much as $1.70 to the treasury, whereas tax cuts for the wealthy return only $00.70. This is capitalism at its most functional.
The liberal reward of labour, therefore, as it is the necessary effect, so it is the natural symptom of increasing national wealth. The scanty maintenance of the labouring poor, on the other hand, is the natural symptom that things are at a stand, and their starving condition, that they are going fast backwards.
Much more, I suspect, is grossly misunderstood about Adam Smith’s views. In example, he is often referred to as an economist. The flaw in this assertion is that, while numerous luminaries wrote treatises on economics at the time, none were economists. In fact, economics did not become a formalized study in universities for nearly a century following the publication of Wealth. The science of economics did not exist. Moreover, Smith was a philosopher of morality, and quite famous for his writings on the topic in The Theory of Moral Sentiments.
The time in which Smith lived further calls many aspects of conventional understanding of his writings into question. Most notably, his advocacy of laissez faire economic principle that conservative politicians are so fond of invoking when they decry government economic intervention. While they ignore the principle when government policy favors business, they invariably oppose government stimulus and “welfare” at every turn, unless they want to bring home the pork to their districts.
In Smith’s day, governments were heavily involved in their respective economies to secure the nation’s mercantilist advantage. Government did, however, not form policy favoring labor, consumers, or to address the environmental damage that the burgeoning industrial revolution was causing. In fact, industrial cities were brutal cesspools of poverty, disease, and polluted air and water, all of which were tacitly supported by government policy.
Government was, in fact, most activist in putting down labor revolts, due to the extreme violence—because labor had absolutely no other recourse. Now, it would be absurd to argue speculatively that Smith would have approved of our social programs, but no more so than to argue that he would disapprove of them. He simply had no basis for any observations on the matter. It seems reasonable to suspect that he would have seen them as counter productive, though he might have thought policy favoring a living wage reasonable.
It’s more likely though that any objection Smith had to a government mandated living wage would be due to his belief and hope that ownership would see the folly of paying poverty level wages. His economics was, after all, a moral philosophy. Greed and building personal wealth have nothing to do with Smith’s capitalist philosophical reflections on building national wealth. These are human flaws in the perception of the role of capitalism.