The Wealth of a Nation

By Pia Varma

So what now? Before you reach for "The Dummies Guide to Getting America Back on Track" let me suggest another book. In fact, it happens to be the same book the Founding Fathers used when they were laying the foundation for this country. It’s called An Inquiry into the Nature and Causes of the Wealth of Nations, now simply referred to as The Wealth of Nations.

Enter Adam Smith: eccentric, reclusive and absent-minded. He never married, he lived with his mother and he often talked to himself. Yet he emerged as one of the leading intellectual heavyweights of the Anglo-Scottish Enlightenment. In fact, many call him the father of modern day economics.

In 1776, Smith published The Wealth of Nations, introducing the world to a brand new concept: Free Market Economics. That same year, across the pond, Thomas Jefferson, George Washington, John Adams and others were planning a revolution that would lead to the formation of what would become the wealthiest nation, a nation based entirely around Smith’s free market principles. But this wasn’t a coincidence.

The Scottish-born Smith had a profound influence on the Founding Fathers. Benjamin Franklin was his personal friend and James Madison was a big fan. Alexander Hamilton borrowed heavily from Smith in his own magnus opus, Report on Manufactures, and there are numerous references to Smith in the letters of Thomas Jefferson. Incredibly, George Washington’s signature was actually found in a 1789 edition of The Wealth of Nations.

Although Smith, himself, never ventured to the American colonies, there is no doubt that his ideas were being bounced around by these men over beers in Philadelphia’s City Tavern or in the debates at Constitution Hall.

But where did Smith’s ideas come from and what were they?

The forces that brought the ideas of Adam Smith to the Founding Fathers in Philadelphia had been set in motion centuries earlier, since the 14th Century re-emergence of Democracy and Republicanism in Italy. The simple concept that an individual could find truth without the aid of God and the Holy Roman Church had empowered the people of Europe, pulling them out of the Dark Ages and kick-starting a vibrant Renaissance.

Hungry for more knowledge, man leaped from one step of human pro-gress to another; the Renaissance became the Elizabethan Era, the Elizabethan Era was followed by the Age of Reason and the Age of Reason became the Age of Enlightenment. By the time the Age of Enlightenment rolled around, classical liberal ideas were in full force. New concepts such as inalienable rights and the acknowledgement of slavery’s immorality were being discussed in coffee houses and political salons across England, Scotland and America. Passions ran wild, and political activism was at its height. English author Thomas Paine had emigrated to the American colonies and was arguing for the rights of man. Edmund Burke and the radical Whigs in England were fighting against the abuses of King George III, just like their counterparts and allies in the American colonies.

By 1776, the stage was set for Adam Smith to introduce his free market ideas. The Wealth of Nations became an instant success, shattering the status quo and throwing a wrench into the power structure. Word about The Wealth of Nations travelled quickly from Scotland to England and throughout Europe, making its way across the Atlantic to the American colonies. The first edition was sold out in six months.

But what were these ideas that shook up the world? Essentially, Smith regarded Man as a rational being who, by acting in his own self-interest, would work to move society forward: "It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest." In the same way, the Founders emphasized the individual’s right to his own life, liberty and pursuit of happiness. Jefferson promised in his first inaugural address that the U.S. government "shall leave [its citizens] otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned."

Smith wanted to find the right institutional framework that would turn his vision of a society where individuals traded freely into a reality. This framework became a Constitutional Republic, where laws protecting inalienable rights reigned supreme and no majority could vote those rights away. Both Smith and the Founders believed that this framework of laws would best enable individuals to "truck, barter, and exchange one thing for another," without interference from the state. The view of the world suggested in The Wealth of Nations is that monopoly power can’t exist without assistance of government.

Smith based his arguments on a very simple idea, that there exists an invisible hand guiding the economic development of society, and this invisible hand functions best when left alone. This invisible hand is made up of all productive members of society, and naturally spreads wealth and increases quality of life. When a government attempts to engineer markets with regulations, subsidies, protectionist policies, sanctions, special licenses, tariffs, taxes and stifling programs, it will always lead to unintended consequences. The Founders took note of this and made specific provisions and clauses in the Constitution, preventing the state from interfering in interstate commerce and promoting the general welfare of the people. They, too, under-stood that the economic system that provided the greatest good for the greatest number of people was the free market system.

At the time, this was an extremely revolutionary idea. Before Smith came along, nation-states had been laboring under a mercantilist system, believing that there was a finite amount of wealth in the world, which must be gobbled up as quickly as possible. In their view, life was a zero sum game; only winners and losers. Spain, England, Portugal, France and others were in constant competition. Wars were waged and marriages and other alliances were formed in this quest for power, dominance and wealth. The primary goal was to have a favorable balance of trade; exports greater than imports, with the difference being settled in gold or IOUs. To a mercantilist, wealth equaled gold and a favorable balance of trade meant more gold.

Smith stated that it is incorrect to think that the wealth of a nation depends upon its holdings of precious metals. Rather than Spain and England competing with each other to grab up resources, it would be in each of the countries’ best interests for them to both be thriving nations. It would mean more customers for their goods and services. Nations could trade with one another and everyone would win. The Founders adopted this worldview and made it the bedrock of U.S. foreign policy.

Smith called this concept Absolute Advantage. He argued that if England can produce a commodity such as cotton at a lower cost than Spain, and if Spain could produce another commodity, such as grain, at a lower cost than England, then each country should stick to doing what it does best and trade; costs go down and quality goes up.

But the idea of Absolute Advantage is not limited to the foreign trade. It also applies to trade within a country. Smith explained that a major contributing factor to the wealth of a nation was the productivity of labor. He went on to say that productivity of labor depended on the division of labor. In the same way that nation-states should stick to doing what they do best, so, too, should individuals specialize in a skill or craft and trade with one another. As labor becomes more divided and specialized, productivity increases and costs go down. The Founders implemented a system of government that enabled individuals to fill needs in the market and contribute to the wealth of the nation.

But, today, America is at a crossroads, choosing between the free market system advocated by Adam Smith and the Founding Fathers and mercantilist policies that dominated the world for centuries. In many ways, Americans still hold on to mercantilist ideas. Our leaders desperately try to protect domestic industries with tariffs, subsidies and other protectionist policies, hoping it will maintain our status as a world leader. They have been on a mission to create shovel-ready jobs for the hundreds of thousands of people who are out of work as opposed to allowing the invisible hand of the market to determine labor needs.

It’s unclear which direction America will take in the future. But the simple reality is that the Founding Fathers adopted the ideas in The Wealth of Nations when they laid the foundation for America, and the United States of America went on to become the wealthiest nation.

You can’t really argue with results.

 



<< Return to the September 2010

Award-winning investigative journalist Lara Logan told Glenn Beck on the radio program Wednesday that a network of radical extremist terrorist organizations, which includes Antifa, are coordinating and escalating many of the violent riots in the wake of George Floyd's death.

Lara, who has done extensive reporting on Antifa, said it's "extraordinary" that so many Americans in the media and politics are defending the "very violent terrorist organization."

"[The media is] pretending that they care about journalism. They don't. They care about silencing, intimidating, destroying, annihilating, and getting us all to self-sensor so we don't cover any of the subjects they don't want us talking about," she said.

"For those of us who've followed [Antifa] for a while, and know what they're doing and what their agenda is, what has always been troubling is the way so many people in the media and in the political establishment have given them cover to operate," Laura added. "These are extremists. And you see a lot of parallels between extremists on the left and the right ... they pretty much operate the same way, exactly. And there's no difference between what Antifa is doing and the 'Brown Shirts' of Nazi Germany. Or the 'Black Shirts' of Mussolini."

She read the 10 points of action listed by an extremist group called the "Revolutionary Abolitionist Movement", which culminates with "Liberation begins where America dies."

Glenn recalled a prediction he made approximately 15 years ago, that "socialist, communists, radicals, anarchists, [and] Islamists would all work together ... they would all see the opportunity and work toward the same goal. And that's destruction of capitalism, and destruction of the Western world."

"A few years ago, I probably would not have agreed with you on that," Laura responded. "But I now see that you're absolutely correct."

Watch the video below to hear Lara detail evidence to expose the truth about Antifa:

Media targets Lara Logan for exposing the truth about Antifa

The media pretends to care about good journalism, but what they really care about silencing, intimidating, destroying, annihilating and getting us all to...


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The Trump-deranged media is calling the president a "coward" because he was moved to an underground bunker as riots erupted outside the White House over the weekend.

Former Secret Service agent Dan Bongino joined the "Glenn Beck Radio Program" Tuesday to set the record straight. He told Glenn that under Title 18, US Code 3056, the Secret Service has the authority to protect the president however they deem necessary, with or without his consent.

Dan explained that the severity of the White House riots, which resulted in at least 50 Secret Service agents being injured, would very likely have warranted overriding the president's preference on whether or not to take shelter.

"Shame on the media ... for painting this as some kind of situation where Trump ran like a coward," Dan said. "Which is totally false and made-up. [...] They're morons. These are imbeciles with double digit IQs who are only in this to aggravate an already-bad situation. And it's a shame, because they're really incentivizing this kind of stuff to happen."

He also made it clear that the so-called protests over the death of George Floyd were actually "very strategic" riots organized by "Antifa terrorists."

"It was not even a protest. It should have been, and could have been ... but that's not what it was. It was an insurrection. It was a riot," Dan stated.

"I can tell you, from sources of mine that were there, [who are] more than credible and unimpeachable, that the attack at the White House -- and that's what it was over a period of days -- was very organized. It was done using very strategic tactics," he added. "I want to be crystal clear, this was organized by Antifa terrorists. It's not a joke. It's not hyperbole. These were people that were committed to an insurrection that was thankfully put down."

Watch the video below for more details:

Dan Bongino: Trump is NOT a Coward Hiding in a Bunker


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The media has been trying to discredit BlazeTV's Elijah Schaffer after he recorded a disturbing video of a man being brutally beaten and stoned almost to death by rioters Saturday evening in Dallas.

Elijah joined Glenn Beck on the radio program Monday to set the record straight.

"The very dishonest far-left media is working tirelessly at the moment to completely, not only discredit myself, but they always say, 'Elijah Schaffer who works for Glenn Beck's BlazeTV.' As if that's an insult. So I'm going to clear the air right now," he told Glenn.

"There was a group of about, I would say 150 rioters. They were not protesters. They were breaking windows. They broke into a bank. They broke into a bar. They were looting alcohol and partying on the streets while breaking glass. These were not people who were grieving over black lives," he added. "The police had lost control of the city."

Elijah went on to describe the violent scene, detailing the events leading up to the brutal beating of a man who was apparently trying to defend a local bar. Elijah posted a video of the incident on Twitter Saturday night.

*Warning: graphic content*

"Rioters with rocks and bricks and bats and weapons, 150 or more, were accosting him as he stood in front of the bar," Elijah said. "Then they started stoning him, Glenn! Medieval! Throwing rocks and bricks.... We're in America. This is 2020. We do not stone people in the United States of America!"

Watch the video below for more details:

*Warning: graphic content*

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A new Pew Research Center report shows the death toll in the United States from COVID-19 is "heavily concentrated" in Democratic congressional districts.

According to the analysis, more than half of all COVID-19 deaths in the U.S. occurred in just 44 (approximately 10 percent of) congressional districts, and 41 of those 44 hardest-hit districts are represented by Democrats, while only three are represented by Republicans.

"A new Pew Research Center analysis of data on official reports of COVID-19 deaths, collected by the John Hopkins University Center for Systems Science and Engineering, finds that, as of last week, nearly a quarter of all the deaths in the United States attributed to the coronavirus have been in just 12 congressional districts – all located in New York City and represented by Democrats in Congress. Of the more than 92,000 Americans who had died of COVID-19 as of May 20 (the date that the data in this analysis was collected), nearly 75,000 were in Democratic congressional districts," Pew reported.

Filling in for Glenn Beck on the radio program this week, Pat Gray and Stu Burguiere argued that, while the coronavirus should never have been made into a partisan issue, the study certainly makes a strong statement in favor of GOP leadership.

Watch the video below:


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