ABSTRACT
Focusing onAnglo-American relations in the late eighteenth century, the purpose of this book is to ‘reveal the practical application of Adam Smith’s theories to political settlements during a time of considerable change and upheaval, when the definition of empire was shifting from military conquest to commercial domination’ (p. viii). The author was motivated by Vincent Harlow’s commendable remark that much research needs to be done on the influence of Smith’s doctrines on the economic policy of British political leaders during the late eighteenth century. Hamilton attempts to achieve this through a study of the ideas of some thinkers who have thus far received scarce academic attention, and their influence on some of the pivotal political figures in the early American republic. He embraces Bailyn’s argument that earlyAmerican culture was mostly the result of further developing metropolitan Western European culture, not least in economic thought. Hume’s, Smith’s and Tucker’s ideas on political economy have remained under-analysed in recent biographies of John Adams and Benjamin Franklin. Still, the author posits, ‘the dialogue of ideas that the British thinkers exchanged with their American counterparts is imperative to understand how the new country positioned itself in relation to other nation-states’ (p. xvi). The pivotal figure in the book is Benjamin Vaughan (1751-1835), the influential private secretary of Lord Shelburne, while both men are singled out as major proponents of Smith’s ideas. By way of context, the book commences with an overview of the debate on
trade in the eighteenth century, particularly the alleged dichotomy between laizzezfaire and mercantilist ‘reason of state’. It must be noted that, throughout the entire book, the author proceeds in a very fragmented way, apparently more informed by the content of his secondary literature, than the specific purpose of the book. So here, in just a few pages, he analyses Stewart’s biography of Smith, follows up with three French thinkers (Turgot, Gournay and d’Argenson) and continues with Jacob Viner and the role of the Christian tradition in the trade debate going back to the fourth-century pagan Libanius. Then, two German thinkers, Oberfohren and Rothkrug, are briefly introduced, before the argument returns to France with a focus on Belesbat and Boisguilbert. While all this is interesting, it fails to provide
convincing evidence for the claim that ‘a genealogy of Smith’sWealth of Nations must necessarily include these French influences’ (p. 17). The reader longs for a more analytical approach, as for example provided by Douglas Irwin (1996), while it remains unclear why other participants in the trade debate in that period are excluded (for example those presented in Clark, 2003). From the second chapter onwards, Hamilton turns to Vaughan; in his words,
‘the essential yet overlooked figure’ in free-trade theories in the context of British colonial relations (p.23) and the ‘cosmopolitan staunch defender of the liberal system’who kept his back straight, while Smith and JohnAdams were ‘eventually pressed to reverse their free trade stances in the face of international trade sanctions’ (p. 24). The author starts with an account of the life of the second Lord Shelburne (William Petty). Petty’s brother was a lodger of Smith and he and Shelburne were lifelong friends, In Shelburne’s own words, Smith’s principles ‘constituted the happiness of my life’ (p. 31). Vaughan, as his confidential secretary, was a key figure in Shelburne’s circle from the 1770s onwards, while he was also a friend of Benjamin Franklin. Consequently, Vaughan acted as trusted friend of both sides during the Paris peace negotiations between America and Britain in 1782-1783. He tried hard to include articles guaranteeing free trade in the peace agreement, but failed. Shortly afterwards, he helped to prepare Shelburne’s speaking notes for his defence of the peace treaty in parliament but this also failed, leading to the latter’s fall as a prime minister. Vaughan then followed in his father’s footsteps as a politically active merchant. He continued to object to moves to limit trade; for example, the initiative to exclude the Americans from commerce with the British West Indies. Vaughan kept friendly relations with many important thinkers and activists in many countries, particularly in France. After the French revolution had escalated, Vaughan left Britain because he feared imprisonment in the wake of investigations into ‘revolutionary enthusiasts’. He ended up in Maine, USA, where he spend the last 35 years of his life as a politically influential land owner. Vaughan was the editor of Franklin’s collected writings and had a hand in the
translation of Condorcet’s Vie de M. Turgot into English. His own writings mainly consisted of essays and letters; for example, advising Shelburne on the American question. In line with Turgot, he consistently emphasised the importance of free trade between Britain and the Americans. Although published anonymously, New and Old Principles of Trade (1788) was almost certainly written by Vaughan (p. 119-120). The essay was republished in 1859 in the collection, New and Old Principles of Trade, edited by the influential free trade supporter John Ramsay McCulloch. Vaughan’s brief treatise was, in the words of Hamilton, ‘not the earliest, yet the most perfect expression of laissez-faire, cosmopolitanism and benevolence before the French Revolution’ (p. 124). In it, Vaughan attacked mercantilism with the help of four conceptual tools. He attempted to show that all participating countries benefited from free trade (the rich country-poor country question) and that free trade fostered peace. He even believed in the beneficial effects of trade between belligerent neighbours. He provided arguments and examples to show that trade theory would work in
practise, while he also used ‘providential arguments’, as Viner has called it, or the idea that God has purposely scattered the resources across the Earth to compel humans to cooperate through commerce. Together the treatise provided a fully cosmopolitan vision of the world. Hamilton follows Hirschmann in the argument that the eighteenth century wit-
nessed a shift in thinking about colonial relations, from passion and power-based raison d’état, to an interest-based doux commerce, as Montesquieu has coined it. Here, the peace enhancing effects of international commercial relations were central. Hamilton also places Hume and Smith (p. 95) in this category. That is simply erroneous. Of course, both Hume and Smith highly valued trade for numerous reasons, not least economic and cultural. Yet they did not expect that increased commercial ties between nations would ensure or even just foster peace. Indeed, they pointed out that the increased wealth of nations as a result of free trade would go together with increased military capacity and that many causes of war remained (see Van de Haar 2009, 2010, 2013). While the author is not unique in making this mistake, it is symptomatic for the
whole book. It lacks a yardstick for the selection of the numerous thinkers presented. It is only a short book, so there is no room for a sufficiently detailed analysis of their thought. This leads to a very scattered information flow. The author’s choice has clearly been to use a broad-brush approach to the history of ideas. That choice in itself is of course valid, yet becomes troublesome if the main questions of the book remain unanswered. To give the most prominent example: the author set out to analyse the practical influence of Adam Smith’s theories. Of course this demands a thorough knowledge of those theories, for which the author does not provide much evidence. The bibliography just lists the Hackett and Cannan versions of theWealth of Nations as primary sources, no other works of Smith are mentioned. Hence, the book does not qualify as a solid piece of Smith-related scholarship.
This said, it is still of some interest to Smith scholars, as the author does succeed to draw attention to the interesting figure of Benjamin Vaughan. Vaughan was one of those almost forgotten yet influential contemporaries of Smith. The two men knew each other and like Shelburne, Vaughan attempted to bring Smith’s principles into practical policy making, particularly in the transatlantic context. His close ties with Franklin and his role during the peace negotiations make it worthwhile to get (re)acquainted with his life story and his writings on trade. The book offers an opportunity for this.
