Erik W. Matson has a defense of reading Adam Smith and other past thinkers. His article is titled, appropriately, “Why We Read Adam Smith.” He admits that he is biased, writing:
In the spirit of self-disclosure, I admit I have a vested interest in people reading Smith. I am part of a cottage industry of academics and educators devoted to the study and teaching of Smith’s ideas—I’m the deputy director of a program named for Smith in the Department of Economics at George Mason University. A declining interest in Smith would probably not bode well for me professionally.
I won’t repeat his argument. I will note, though, that he cites Richard Hanania’s argument against reading Smith and others. He quotes this from Hanania:
[T]he idea that someone writing more than say four hundred years ago could have deep insights into modern issues strikes me as farcical. If old thinkers do have insights, the same points have likely been made more recently and better by others who have had the advantage of coming after them.
You can’t dismiss Hanania’s argument; it’s an empirical one. What I will say is that people often miss the insights from a few generations back. Talk to young economists nowadays and tell them that from the mid-1930s to about 1980, the federal Interstate Commerce Commission insisted that trucks be licensed to carry whatever goods they carried in interstate commerce. So, for example, they might be licensed to take good A from city X to city Y, but that didn’t mean they could legally carry good B back from city Y to city X. So trucks were often forced to come back empty. There’s a good chance that those economists won’t believe you. That’s because they’re not reading any of the very good studies of the effects of trucking regulation from the late 1950s to the mid-1970s.
Of course you might argue that this is a failure to read works that are 50 years old, not 250 years old. True, but that’s a matter of degree. You might also argue that it’s a failure to read empirical studies, not the classics. But what were the classics? When Adam Smith claimed that the cost of Britain holding on to the 13 colonies exceeded the benefits to Brits, he was doing a back-of-the-envelope empirical study.
My favorite example of someone not knowing the history of a policy idea comes from Ron Hoffman, an economist in the U.S. Treasury in the late 1970s and early 1980s and a senior economist colleague of mine when I was a summer intern at the Council of Economic Advisers in 1973. (Parenthetically, I’m still grateful to Ron for telling me about a first-rate immigration lawyer whom I hired that summer when I got in trouble for working illegally, unbeknownst to me, at the CEA. Ron, by the way, is Dustin Hoffman’s brother.)
When I became the senior economist for health policy with the Reagan/Feldstein CEA in 1982, I looked up Ron, who told me the following story. During President Carter’s one term as president, Ron was heavily involved in health economics policy at the Treasury. The Secretary of Health, Education, and Welfare (HEW) from 1977 to 1979 was Joseph Califano. Califano had the idea of imposing a special federal tax on cigarettes and (I think) alcohol to finance part of Medicare. Ron went over to HEW to discuss the idea with one of Califano’s guys. Ron took along a Treasury veteran who had been in the Treasury from the late 1930s on. Califano’s guy had a gee-whiz, isn’t this a great idea tone, and expressed his thought that this was a new idea. The grizzled Treasury vet then proceeded to tell him about past similar proposals in the 1930s that had gone nowhere for various reasons. Ron was impressed and the HEW guy was stunned.
Postscript: Here’s the Concise Encyclopedia of Economics entry on freight transportation regulation and deregulation.
READER COMMENTS
Richard Fulmer
Oct 9 2023 at 9:49am
Wikipedia has a nice list of Latin phrases that is worth reading even though many of its nuggets of hard-earned wisdom are thousands of years old. Age is not synonymous with either wrong or irrelevant.
steve
Oct 9 2023 at 10:43am
When you are young you have no sense of history. I think it’s important that you read the classics, be it the Odyssey, Shakespeare or Adam Smith so you get some idea of how our ideas and culture developed and which ideas transcend time. Over time other authors will refine those ideas but the basics stick. What I wish Hanania had said is that sometimes some people seem to become almost  obsessive in defending the founders of what they believe, but Im not really hero worship type so what do I know.
Otherwise, totally agree that knowing history is very important. Without deregulation I would have had to drink a Bud or Miller instead of very nice microbrew I had this weekend with the pork chops and Alabama white sauce. But we also need to know history we dont like. Like when drugs weren’t regulated they mostly didnt work and many were harmful.
Steve
James Anderson Merritt
Oct 10 2023 at 11:50pm
Then again, the substitute ingredient that (over-the-counter) Sudafed PE uses instead of pseudoephedrine, making the product noticeably less effective than the original (still available, but restricted) Sudafed, is a direct result of “regulation” and the Drug War. This is why we can’t have nice (effective) things! 🙂
Monte
Oct 9 2023 at 1:11pm
No question.  History is replete with examples of why this is so.  Ford revolutionized the automobile industry by leveraging old ideas to conceptualize the assembly line.  Patton studied ancient battle tactics that helped develop him into one of the greatest generals in military history.  And let’s not forget New Ideas From Dead Economists.
But as you suggest, it’s as much, if not more, a matter of missing the insights from old ideas than it is a matter of learning from them. Â Even so:
Those who cannot remember the past are condemned to repeat it. – George Santayana
Mark Z
Oct 9 2023 at 3:04pm
One point made by Hanania – or Bankman-Fried really – is mathematically flawed: that because the human population was so much lower hundreds of years again, the vast majority of people worth reading must be recent. By this logic, India and China should win every competitive international sports event. But they don’t. This is because the marginal returns to ‘economies of scale’ diminish with scale. Once countries get into the size of millions of people, the best few athletes – or thinkers – in that country will tend to be comparable in quality to best few from countries even 100x their size, all else being equal. So the best thinker. So, at least if only thinking about the demographics, it’s just as plausible that the best economist from 18th century Britain would be as good as the best economist from modern day America as it is that the best economist from modern day Sweden is as good as the best economist from modern America. Specialization makes it even more plausible. 17th century Netherlands produced more great artists than much larger neighbors like France and Germany. Talent in a given subject is almost never homogeneously distributed across space, why should it be so distributed across time?
A second objection: we read thinkers not because of their raw intellectual ability, but because of their novelty, and in novelty, it’s actually the earlier thinkers who have the advantage, not later ones. I don’t doubt that many modern economists are smarter than Smith and could’ve made his insights, but didn’t get the chance because he was born first. That may be unfair, but we don’t choose who is worth reading based on the fairness of the allocation of glory. Hanania might just as well argue that physicists shouldn’t bother learning Newtonian mechanics because most modern physicists are smarter than Newton. That’s likely true that they are. It’s not unlikely that every theoretical physics paper published in the latest edition of Nature required more intelligence than Newton possessed, and that the authors are smarter than Newton. That doesn’t mean any of these papers are more important understand than Newtonian mechanics. I’m guessing most of those authors would agree. The reason for reading Smith (or learning Newtonian mechanics) isn’t because Smith or Newton were so smart, but because, due to the novelty of their work, understanding them is foundational to understanding what came after them.
You’re right that Hanania’s position can’t just be dismissed, but I found it pretty unpersuasive.
David Henderson
Oct 9 2023 at 3:34pm
Well said, including your last line. The reason I said he can’t be dismissed is that I was trying to respond in advance to people who might think Hanania is so outrageous that they forget to consider his point. But clearly you did consider his point, and did it well.
Dylan
Oct 9 2023 at 5:25pm
Here’s a counterpoint. I haven’t read the Hanania piece, so I don’t know if this is part of his argument or not. But, there is an opportunity cost to reading any book, and that is all of the other books you could be reading instead. That cost is higher for books written long ago, just because the language is different and it takes more mental effort and hence time to parse out the meaning (there’s benefit to expending that mental effort for sure, but lets ignore that for now).
I’ve currently got a copy of Mill’s Principals of Political Economy on my nightstand and I read a few pages of this once a week or so before bed. I enjoy it and find it worth reading, but I go slow. I’ve been working my way through it for over a year and still have a good chunk of the book remaining. But here’s the thing, there are nuggets to be found, but precisely because Mill was so influential, most of the insights don’t come across as novel. They are things I’ve picked up in classes, though other readings. blogs like this one, and in the general ether of the world. And, of course, most of it just confirms my priors. I’m not sure I’m learning much that is new.
And here’s the thing, I figure at my slow pace of reading I’ve got maybe a dozen “great books” left in me. I’m thinking I’d probably be better served by reading things further outside of my sphere, that look at things from a perspective I haven’t considered before and be content to get my Adam Smith (and Buchanan and Coase and de Jasay) secondhand from the fine folks here and elsewhere on the net.
Thomas L Hutcheson
Oct 9 2023 at 3:14pm
“Talk to young economists nowadays and tell them that from the mid-1930s to about 1980, the federal Interstate Commerce Commission insisted that trucks be licensed to carry whatever goods they carried in interstate commerce.  … There’s a good chance that those economists won’t believe you.”
Possibly, but if so, it’s not failure to read the source documents documenting the policy, but that the policy seems so bizarre to anyone today. Even in Carter’s time, no one could think of a reason for the ICC policy (I was around and never heard one) beyond regulatory capture. Hopefully one day they’ll look back on NIMBYism or our immigration laws or ways of discouraging net emissions ofCO2 with a similar disbelief.
Kurt Schuler
Oct 9 2023 at 7:41pm
Ideas in science and technology are embodied in physical goods. A cell phone embodies thousands of scientific and technological ideas. It would be impossible to continue producing cell phones if the knowledge of those ideas were lost, so there is an incentive to transmit the knowledge, which admittedly is dispersed among thousands or millions of people.
Ideas in art, economics, politics, literature, and many other fields are not embodied in the same way. One cannot assume that the current state of such fields contains most of what has proved useful in the past. They more resemble history, where it is important to return to the original sources because later generations may have forgotten what their predecessors knew.
Mactoul
Oct 10 2023 at 1:21am
Each era has a kind of group think, a bundle of assumptions that pass unnoticed since they are shared by most writers and readers alike.
Reading authors from another era, who do not share the assumptions prevailing in our era, could make us notice our unexamined assumptions.
robert curry
Oct 13 2023 at 11:57am
Dear Mactoul,
Thank you for your excellent contribution!
There is no substitute for reading Smith or the Founders or other greats of the stature of Smith and the Founders. They provide an education not to be gotten in any other way.
Best wishes
Kshitiz Mishra
Oct 14 2023 at 10:02am
Well, Thomas Kuhn in Structure of Scientific Revolutions has rightly argued that knowledge doesn’t proceed linearly, but on paradigms, as one paradigm replaces the another. There is no obvious reason why we think that one paradigm is a better version of the previous paradigm (or even contains the previous paradigm as a subset). It is thus useful in at times to keep reading about previous paradigms, or at least the book that basically started the whole damn subject.
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