Adam Smith Said Colonists Should Join the British Union. Was He Serious?

Reading between the lines of The Wealth of Nations


By the time Adam Smith's An Inquiry Into the Nature and Causes of the Wealth of Nations appeared on March 9, 1776, the American colonies were in a state of revolt and the British authorities were furiously debating what was to be done. Smith's Wealth of Nations presented two options.

The first option was to let the colonies go. The second was to unify the American colonies with Britain the way Scotland had been united with England. Smith himself was Scottish and, looking back, was very glad of the 1707 Acts of Union, whereby Scotland quit its parliament in Edinburgh and henceforth sent parliamentarians to Westminster. In Wealth of Nations, Smith suggested the same course for the American colonies. He proposed that Americans send parliamentarians to sit as equals in Westminster. Just as Scotland belonged to Great Britain, so now would those erstwhile American colonies which opted in. Smith's proposal did not specify a new name for the enlarged constitutional state, but Smith foresaw with remarkable accuracy that a new name would, in time, be in order.

But did Smith propose such a union in earnest?

There was an outpouring of ironic writing in mid–18th century Britain, as Wayne C. Booth notes in his 1974 study, A Rhetoric of Irony. Likewise, as Arthur M. Melzer explains in 2014's Philosophy Between the Lines: The Lost History of Esoteric Writing, writing between the lines was pervasive up to the end of the 18th century.

Smith was no stranger to irony. His first publications in 1755 in the Edinburgh Review contained sly digs and satire. Such devices abounded in his 1759 book, The Theory of Moral Sentiments. Wealth of Nations is more straightforward, but it still has its sly moments and undercurrents.

A close examination of Smith's two proposals for how the British might deal with the American colonies suggests, to me, that Smith employed his deep understanding of rhetoric and artful indirection to advance his point of view more successfully than a direct approach would have.

Let 'em Go

What should Britain's rulers do about the American colonies? Smith's first-best answer was: Let 'em go. Here, Smith was direct and unequivocal. He wrote at length about the colonies as a fiscal sink for the British state, and he summed his case up in a characteristic one-sentence paragraph: "Under the present system of management, therefore, Great Britain derives nothing but loss from the dominion which she assumes over her colonies."

Smith likened letting go of the colonies to an act of proper parenting. It was the same as granting independence to a child who had come of age, which Smith said was the Greek approach, as opposed to the Roman. "The same sort of parental affection on the one side, and filial respect on the other," Smith wrote, "might revive between Great Britain and her colonies, which used to subsist between those of ancient Greece and the mother city from which they descended."

In Wealth of Nations' final chapter, Smith returned to the benefits of the let-'em-go approach. "If any of the provinces of the British empire cannot be made to contribute towards the support of the whole empire," he wrote, "it is surely time that Great Britain should free herself from the expence of defending those provinces in time of war, and of supporting any part of their civil or military establishments in time of peace, and endeavour to accommodate her future views and designs to the real mediocrity of her circumstances."

Alas, proud rulers routinely deny the real mediocrity of their circumstances. Letting go of colonies is "always mortifying to the pride of every nation," Smith observed. Moreover, letting go is "always contrary to the private interest of the governing part of it, who would thereby be deprived of the disposal of many places of trust and profit, of many opportunities of acquiring wealth and distinction." Corrupt elites refuse the first-best answer.

Therefore, Smith suggested a second-best option.

The Art of Indirection

Smith's second-best option was a trans-Atlantic union between Britain and the American colonies. But was this course offered in earnest? In my view, Smith acted like union was more possible and more desirable than he really thought it would be.

Why would Smith put on an act? Because his talk about forming a union was really aimed at helping opponents of American independence see the folly of their ways. As Smith explained in his lectures on rhetoric, some situations call for indirection; thus, we "are to conceal our design." Smith understood that nobody likes to be in the position of an inferior corrected by a superior. Readers want to identify themselves with the superiority of insight. So it was often best to put the reader in a position to put it all together for himself. Smith associated this indirect method with Socrates.

Smith conceded that a trans-Atlantic union between Britain and the American colonies would face great difficulties. "I have yet heard of none, however," he wrote, "which appear insurmountable."

There are good reasons to doubt his earnestness here. A big one is that Smith explicitly wrote elsewhere that he doubted the political feasibility of any such union. In a document on American affairs, dated February 1778, Smith wrote: "The plan of a union with our colonies and of an American representation seems not to be agreeable to any considerable party of men in Great Britain." Indeed, it "seems scarce to have a single advocate." To be sure, Smith's assessment of political possibility might have declined between 1776 and 1778. But if Smith's ostensible second-best option (union) was really just a ploy to overcome resistance to the first-best option (let 'em go), then we may doubt that Smith ever saw any political possibility in the first place.

What is more, Wealth of Nations elaborated on the impracticality of governing across the expanse of the Atlantic, which is what union would have entailed. "The distance of the colony assemblies from the eye of the sovereign, their number, their dispersed situation, and their various constitutions, would render it very difficult to manage them," he wrote. "The unavoidable ignorance of administration…the offences which must frequently be given, the blunders which must constantly be committed in attempting to manage them in this manner, seems to render such a system of management altogether impracticable with regard to them."

Such points had been made by others. Referring to the American colonies in 1775, for example, Edmund Burke noted that, "three thousand miles of ocean lie between you and them." Trans-Atlantic republicanism would be absurd enough in our Zoom age; in 1776, when each single piece of a dialogue between someone here and someone there meant a written document traveling for months at enormous expense, meaningful representation—a hot slogan in America at the time—would obviously be a farce. The following exchange, for example, would take more than six months to complete:

"William, has winter been harsh?"

"This is William's widow. Yes, winter was harsh. Can you come and help me raise the children?"

"I set sail in May."

Shared experience, understanding, and negotiation would all be lacking; trust would break down; suspicion would be rampant. People would demonize distant elites, just as many did at the time in rallying for a clean break with Britain. Union, in short, was a complete nonstarter, and for good reason. Smith's proposal was a put-on.

Read Between the Lines

When Smith talked up the desirability of union, what he meant was union as opposed to war between Britain and the American colonies. He was not saying that union was more desirable than letting the colonies go. He made his ranking perfectly plain.

Smith's ranking of three options:

1. Let 'em go

2. Union

3. War

In elaborating how union was preferable to war, he made points that would also work for letting 'em go over war. In talking up union, he indirectly talked up letting 'em go.

It is in arguing for union over war that Smith made some of his most colorful remarks about American affairs. Offering union was better than vanquishing the Americans, he wrote, because "the blood which must be shed…is, every drop of it, the blood either of those who are, or of those whom we wish to have for our fellow-citizens." The American War for Independence was a civil war, British versus British. Was it also a revolution? It was not like the English Revolution or the French Revolution, which saw kings beheaded. American patriots had no plan to sail to England to decapitate anyone. They sought to extricate themselves from rule by King George III and the rest—to secede, like a grown son going his own way.

Second, union was preferable to war because the Americans would be so hard to vanquish. He wrote:

The persons who now govern the resolutions of what they call their continental congress, feel in themselves at this moment a degree of importance which, perhaps, the greatest subjects in Europe scarce feel. From shopkeepers, tradesmen, and attornies, they are become statesmen and legislators, and are employed in contriving a new form of government for an extensive empire, which, they flatter themselves, will become, and which, indeed, seems very likely to become, one of the greatest and most formidable that ever was in the world. Five hundred different people, perhaps, who in different ways act immediately under the continental congress; and five hundred thousand, perhaps, who act under those five hundred, all feel in the same manner a proportionable rise in their own importance. Almost every individual of the governing party in America, fills, at present in his own fancy, a station superior, not only to what he had ever filled before, but to what he had ever expected to fill; and unless some new object of ambition is presented either to him or to his leaders, if he has the ordinary spirit of a man, he will die in defence of that station.

The self-importance swelling in the erstwhile shopkeepers and attorneys in America could, Smith pretended, be tempted in another direction: by offering union. "Instead of piddling for the little prizes which are to be found in what may be called the paltry raffle of colony faction," he wrote, "they might then hope, from the presumption which men naturally have in their own ability and good fortune, to draw some of the great prizes which sometimes come from the wheel of the great state lottery of British politics." In sum, Smith's argument-by-misdirection made union sound more attractive than war, after having already made letting 'em go sound more attractive than union. The whole thing boiled down to Smith making the case for letting the colonies go.

Decline and Fall

Smith gave his British readers something else to ponder. "Such has been the rapid progress" of the American colonies "in wealth, population and improvement," he observed, "that in the course of little more than a century, perhaps, the produce of American might exceed that of British taxation. The seat of the empire would then naturally remove itself to that part of the empire which contributed most to the general defence and support of the whole."

In other words, a trans-Atlantic union might easily result in America eclipsing England within the British state. English parliamentarians would then find themselves on the periphery, enjoying the sea air during long voyages to a new parliamentary building in a place like Philadelphia. Furthermore, with England now at such a distance from the power center, what should the empire be called? Under the union plan, Smith suggested, Britons might look forward to calling themselves citizens of the American empire.

Smith probably designed this uproarious argument to turn the tables on his British readers and awaken them to the absurdities of both union and war, leaving letting 'em go as the only viable option for dealing with the American colonies. Readers of another famous work published in 1776, the first volume of Edward Gibbon's The History of the Decline and Fall of the Roman Empire, would also surely have grasped the parallels that Smith was subtly drawing. Thanks to rising industry elsewhere, the Roman capital moved from Rome to Ravenna to, finally, Constantinople. Once again, Smith advised the British to emulate the Greeks, not the Romans.

When your sons and daughters are grown and demand independence, accord them that independence.