Happiness was one of the most important parts of Adam Smith’s systematic analysis of human society. His close friend and first biographer, Dugald Stewart, makes this clear:But the philosophers of all the different sects very justly represented virtue; that is, wise, just, firm, and temperate conduct; not only as the most probable, but as the certain and infallible road to happiness even in this life. 1
Smith’s passion for happiness is clearly compatible with the revolutionary ideals of the USA. Among those ideals in the Declaration of Independence are the equal and unalienable rights to life, liberty, and the pursuit of happiness; that Jefferson placed those words in the Declaration was no accident. The Constitution also listed revolutionary goals important to happiness, such as establishing justice and promoting the general welfare which, for the founders, meant the well-being of all—not the current connotation of government support programs for the poor.The study of human nature in all its branches, more particularly of the political history of mankind, opened a boundless field to his [Adam Smith’s] curiosity and ambition; and while it afforded scope to all the various powers of his versatile and comprehensive genius, gratified his ruling passion, of contributing to the happiness and the improvement of society. 2
These documents are so familiar that their revolutionary significance is not always appreciated. Revolutionary? Many historians argued that the US war of independence was not a revolution because we simply exchanged British elites for local elites; the working class did not take power. The Marxian class warfare argument is correct, as far as it goes, but it grossly minimizes the importance of our astounding ideals. Our founders did not invent these ideals, but they were radical innovators because they were the first to apply to everyone ideals that had previously affected only a few people. Universal application of rights to equality, liberty, and the pursuit of happiness was revolutionary.
Adam Smith and the American founders shared a concern for the happiness of the entire population. They also shared a desire to improve society to increase the chances of universal happiness. This book analyzes Smith’s ideas about happiness and attempts to apply them to contemporary society.
Contrary to what contemporary Americans think, Smith and the founders were not individualistic; they emphasized social relationships. Students of the new science of happiness are virtually unanimous in affirming the importance of this point. Ed Diener and Robert Biswas-Diener argue that “we need others to flourish.” 3 Comparing the least happy people with the happiest people, their research shows the importance of “high-quality friendships, family support, or romantic relationships; the happiest folks all had strong social attachments.” 4 Martin Seligman’s work shows the connection between altruism and happiness. 5 Richard Layard states that, “If we really want to be happy, we need some concept of a common good, towards which we all contribute.” 6 Predating the happiness scholars by several decades, Bertrand Russell clearly stated the importance of social relationships for happiness. 7
Because it ignores the science of happiness and the wisdom of Smith and the founders, modern individualism impedes our quest for happiness. Such individualism is also economically costly to societies. We would promote the general welfare, the good of all, if self-interest were moderated by the social values of Smith, the founders, and happiness researchers. It is time to remember the revolutionary ideal of equality in the pursuit of happiness. But, before going into detail (in Chap. 2) about why we ignore this ideal, we must try to define happiness.
Happiness
Happiness is neither easily defined nor easily attained; nevertheless, from ancient philosophers to modern positive psychologists and behavioral economists, humans have tried both to define it and attain it. Moreover, Thomas Jefferson made happiness a test of the very legitimacy of a government which “exists for the happiness of the governed.” 8 Jefferson could have gotten this idea from Adam Smith, who wrote: “All constitutions of government, however, are valued only in proportion as they tend to promote the happiness of those who live under them.” 9
The idea that the people’s happiness is the purpose of government was widely shared by the founders. For instance, John Adams wrote in 1776 that whatever form of government provided “ease, comfort, security, or in one word, happiness to the greatest number of persons, and in the greatest degree, is the best.” He also wrote in the same document that happiness “consists in virtue.” 10
Government, on its own, cannot provide happiness; happiness comes from within. But government, one part of a multifaceted socio-economic system, helps provide a framework which can facilitate happiness or impede it. This work will focus on the interaction of government and the economy. In the USA and in much of the world, economies are based on market principles that were first clarified by Adam Smith. We will examine how Smith’s political economic thought might help increase happiness.
Smith wrote that a major part of happiness “arises from the consciousness of being beloved.” 11 His understanding of human beings included his conviction that we all require mutual assistance. “Where the necessary assistance is reciprocally afforded from love, from gratitude, from friendship, and esteem, the society flourishes and is happy.” 12 Or, as a biographer puts it, “Smith is saying that the happiness of others is necessary to us….” 13 His social orientation is also obvious in his praise for benevolence “aimed at the happiness of a great community…” rather than benevolence aimed “at the happiness of an individual, such as a son, a brother, a friend.” 14 The importance of sociability is also demonstrated by his comments on the negative implications of antisocial behavior for happiness; he stated that hatred and anger “are altogether destructive of that composure and tranquility of mind which is so necessary to happiness, and which is best promoted by the contrary passions of gratitude and love.” 15
Individualistic Americans may be surprised by Smith’s emphasis on the importance of sociability for happiness. But as noted above, happiness scholars are virtually unanimous on this point. Supporting it, a modern economist, Joseph Stiglitz, recounts his parents’ definition:
Here, Stiglitz argues against a common individualistic assumption: he who has the most toys wins. Do possessions bring happiness? Modern consumer society is based on the assumption that they do. Some economists have supported and some have criticized this view. John Kenneth Galbraith notes that, for Bentham, consumption was the supreme source of “happiness”; but, Galbraith notes: “With Veblen it became in its fullest development a vacuous thing, a service to puerile personal aggrandizement. Is this what the economic system is really about?” 17 Consumption is a perpetual treadmill; people are never satisfied. Make one significant purchase, and rising aspirations require another purchase. Material desires are insatiable. 18I remember clearly my parents’ advice when, like all teenagers, I wondered what I would do when I grew up. They said, “Money is not important. It will never bring you happiness. Use the brain God has given you, and be of service to others. That is what will give you satisfaction.” 16
One form of consumption is viewing television. Americans watch an average of 35 hours of TV (in all its forms, including video) per week. If watching TV makes you happy, y...