Dreams of the ideal city: reconciling the market and the republic
Smith and Rousseau on the tensions between the market and the good society
The deep issue, perhaps, underlying today’s fractious politics is the question of reconciliation: how to reconcile our desire for community, for shared purpose, for rewarding work, for security, for meaning, with the unyielding pressures of the global marketplace.
We depend upon ever more intricate systems of commercial exchange for our prosperity. But the relentless imperative of market discipline pulls against our wish for settlement, for refuge from the utilitarian business of economic survival.
The dominant theme in our politics is the turn away from liberal cosmopolitanism towards nation, ably cultivated by populists appealing to nostalgia for an imagined golden age of secure and settled identity. The dilemma may seem especially acute today, but it has resonated through political philosophy as societies have become ever more entwined, as I was reminded by a thoughtful discussion in a book first published in 1984, and republished last year, The Needs of Strangers, by the Canadian politician-scholar Michael Ignatieff.
Comprising four fine essays, the book probes the nature of the obligations we owe to others, the mutual claims capable of bonding a society of strangers. For me, one in particular stood out, The Market and the Republic, a discussion of the issues raised by a brief intellectual encounter between Adam Smith and Jean-Jacques Rousseau, in the form of Smith’s 1756 review of Rousseau’s Discourse on the Origin and Basis of Inequality Among Men published the previous year.
The exchange, however brief, between two major political philosophers of the age, Rousseau, the defender of the classical ideal of the republican city state, and Smith, still the most powerful advocate for the market economy, helps clarify why the argument over sovereignty and the market seems so fraught, and so circular. For it is not a problem to be solved, but a dilemma to be managed, of negotiation between two ideals, two political languages.
Ignatieff acknowledges from the outset that his heart is with Rousseau, with the dream of the classical polis, the city state of ancient Greece and Renaissance Italy. For Ignatieff:
Its human dimensions beckon still: small enough, so that each person would know his neighbour, and could play his part in the governance of the city, large enough so that the city could feed itself and defend itself; a place of intimate bonding in which the private sphere of the home and family and the public sphere of civil democracy would be but one easy step apart; a community of equals, in which each would have enough, and no one would want more than enough; a cooperative venture, in which work would be a form of collaboration among equals. Small, co-operative, egalitarian, self-governing and autarkic: these are the conditions of belonging that the dream of the polis has bequeathed to us.
But, like Rousseau, he recognises it is a utopia, impossible, certainly, by the eighteenth century as the imperatives of market pressures continued to assert themselves. The classical vision of the autarkic city state assumed a capacity for economic self-sufficiency, a defined population, and sufficient leisure for universal participation in civic life that absorption within an international market had eroded, with its imperatives to trade, open borders and a competitive labour market.
For Rousseau, the trespass of the market on once autonomous cities and nations was a fall, not only from the classical ideal, but from a golden age that predated civilisation itself, a state of grace in which nature’s abundance offered all that was necessary for material subsistence. There was no economic surplus to distribute, and so no space for inequalities to develop and envy to corrupt. Commercial exchange, however, had ripped Rousseau’s primordial state of harmony apart. He wrote in the Discourse:
But from the instant in which one man had occasion for the assistance of another, from the moment that he perceived that it could be advantageous to a single person to have provisions for two, equality disappeared, property was introduced, labour became necessary, and the vast forests of nature were changed into agreeable plains, which must be watered with the sweat of mankind, and in which the world beheld slavery and wretchedness, begin to grow up and blossom with the harvest.
Rousseau’s imagined state of nature was a utopian fantasy. Smith agreed that commerce generates desires that can never be satisfied. But that was the point. The continual transformation of the material world opened and necessitated by trade sparked the insatiable desire for accumulation through our forebears transcended material scarcity:
It is this which first prompted them to cultivate the ground, to build houses, to found cities and commonwealths, and to invent and improve all the sciences and arts which ennoble and embellish human life; which have entirely changed the whole face of the globe, have turned the rude forests of nature into agreeable and fertile plains, and made the trackless and barren ocean a new fund of subsistence, and the great high road of communication to the different nations of the Earth.
Commerce between cities and nations demanding perpetual ingenuity and ever finer divisions of labour was the key that unlocked the hitherto undreamt of capacities of the material world, generating the surplus that has freed us from the bonds of nature Rousseau had idealised.
Smith acknowledged that the relentless wheel of accumulation has opened up vertiginous inequalities and kindled the envy that attends them. But that is a feature of the system, not a bug, driving the desire for emulation that spurs the generation of ever greater wealth. And prosperity is not a zero-sum game. Though the poorest access only a fraction of the market’s bounty, their absolute share has continually increased, exceeding in Smith’s blunt eighteenth century words ‘many an African king, the absolute master of the lives in liberties of ten thousand naked savages’.
And although the obligation to introduce ever more granular divisions of labour — the need for ‘the narrow enclosing of the self in one task’ as Ignatieff puts it — has narrowed the range of skills that work has required us to master, specialisation has enabled exponential gains in productivity, opening up the possibility, at least, of fewer working hours.
Salvaging utopia
But Rousseau recognised that. The argument of the Discourse is much more hard-headed than its utopian tendencies might suggest: a persuasive description of what has been lost in the age of capitalism, and a subtle effort to recover what can be salvaged from the republican ideal in an age of commerce. For Ignatieff ‘Rousseau’s writing is the most profound attempt to defend the possibility of an egalitarian republic of citizens within the international division of labour of an emerging capitalist economy.’
Rousseau didn’t deny commerce’s capacity to generate wealth, or believe time could be turned back. But he believed the unfettered market society contains the seeds of its own destruction. The relentless imperative of competition turns citizens against each other, dissolving their sense of common purpose, fostering resentments as inequalities widen. Capitalism replaces natural scarcity with social scarcity, the entrepreneur exchanging, in Ignatieff’s words, ‘natural alienation for social alienation, a battle with his fellows in place of a battle with the natural world’. The untrammelled market society tends to undermine itself, corroding the social bonds on which it depends. As discontent rises democratic and economic institutions are menaced by populism, or even the threat of revolution.
For Rousseau, then, wise governance of the modern market-driven polity requires the amelioration of ‘extreme inequality or Fortune’. Although his concern for equality anticipated the socialist philosophies that were to emerge over the following century he himself did not believe wealth should be forcibly redistributed. In Rousseau’s just republic the law applies equally to all: property could not be simply appropriated. Rather, the Discourse proposed a complex suite of interventions designed to check inequalities and preserve a sense of civic duty and common purpose.
Some of Rousseau’s proposals anticipated modern social democracy, such as taxes on wealth and income in proportion to circumstances, levies on luxury goods, and selective tariffs on trade. Others were more esoteric, reflecting his appeal to the classical virtues and the assumptions of his age. Following the Roman admiration for the hardy rustic life he advocated for taxes on manufacturing to preserve ‘honest’ agricultural work. Anticipating the Luddites he argued for restriction of the production of machines to protect craft-based forms of labour. And he had less faith than today’s technocratic progressives in the agency of the state. In accord with the republican ideal he believed citizens should govern themselves rather than rely on a class of professional bureaucrats and politicians to administer the duties of government.
The credibility of Rousseau’s patchwork of proposals can be disputed, and Smith did, presenting in his review an early version of his classic case for liberal capitalism. Restrictions on commerce can threaten social order as much unrestrained exchange, disrupting the engines of prosperity. Taxes discourage enterprise, and imports generate trade wars. New technology does render certain skills redundant, but the process of ‘creative destruction’ that drives capitalism generates demand for new ones. And efforts to shift the balance of the economy from urban to rural end up harming both: poorer cities mean less demand for agricultural produce.
But whatever the merits or otherwise of his particular proposals, Rousseau’s essential concern to preserve the common good against the market forces that drove people apart was shared by Smith. His definition of the market society prioritised the natural liberty of commercial exchange over the republican liberty of collective laws: in today’s language, perhaps, the freedom of the individual over equality. He did, however, recognise the tendency of individualism to erode the collective capacity of societies to discern the general interest. Like Rousseau he believed the public-minded individual should view themselves as a citizen, not just a consumer.
Two kinds of stoicism
Ignatieff notes that the political philosophy of both appealed to the stoic tradition, the capacity of the individual to check and channel desire through exercise of the will. Rousseau’s debt to stoicism is clear: the virtuous citizen must retain a steely capacity to choose the good, to resist the temptation to greed and envy, acting at all times with a view to the needs of the collective, not mere self-interest. Like Aristotle, the archetypal philosopher of the city state, he believed that virtue could become habitual. His interventionist state could help by removing, so far as possible, temptations to envy and competition.
Smith, although best known for modern capitalism’s definitive statement, The Wealth of Nations, developed a powerful moral philosophy in his earlier book The Theory Of Moral Sentiments, in which he argued that the virtuous citizen can practise good conduct by judging their actions from the perspective of an impartial spectator. Though sceptical of Rousseau’s interventionist agenda, he advocated publicly funded civic education to encourage the virtues of prudence, restraint and civility. For Ignatieff:
In the end, Smith had to make demands on the virtue of this utopia’s participants as austere as Rousseau. A market society could remain free and virtuous only were all its citizens were capable of stoic self command. Without this self-command, competition would become a deluded scramble, politics a war of factions, and government, a dictatorship of the rich.
The exchange between Smith and Rousseau illuminates the tragic dimension of political choice often lost in today’s debates: the need to choose between alternative goods that cannot be reconciled, in this case the conflict between private interest and public good. Then, as now, two concepts of the good are at stake, the one emphasising the generation of wealth, a taste for the novel, and the freedom of the individual, the other, security, settled vocation, and public virtue. Two ideals confronting and pulling against each other that cannot be resolved, but only accommodated, through negotiation, compromise and tolerance.
Elements of Rousseau’s thought foreshadow the radical socialist manifestos that were to follow. But for Ignatieff the Genevan’s philosophy is more hard-headed than the socialist faith supposing that the conflict between private interest and public good will fade under the conditions of material abundance emerging once the state has appropriated the means of production and channeled them towards the public good, allowing moral and intellectual life to flourish once the grounds for poverty, competition and envy have been removed.
But surely the conflict between private and public interest — between family and community, personal status and the needs of others, ambition and leisure — is too stubborn to wither with a change of economic system. And by appealing to the inevitability of world revolution, radicals sidestepped the hard issue Rousseau addressed: how to hold on to solidarity, a sense of community, against the tides of the global marketplace. The promise of world revolution in Ignatieff’s words is ‘a fantasy of deliverance from history that owed a suppressed debt to the religious image of the apocalypse’.
Marx, at least, has an intellectual rigour today’s populisms, with their hazy appeal to nostalgia lack. But, against liberal globalists, they in turn do take seriously the human need for settlement. Ignatieff’s lucid exposition shows the encounter between Rousseau and Smith offers a surer guide to the issues at stake than so much of what has followed.
The Needs of Strangers by Michael Ignatieff is published by Pushkin Press.
