“What is annually saved is as regularly consumed as what is annually spent, and nearly in
the same time,” (Sowell). It is said that history repeats itself over and over again. I think that this
is true, especially when it comes to an economic perspective. Some of the same issues that were
going on during the time of Adam Smith is continue to happen today. For an example when the
American economy was suffering, many consumers did not spend much, but they were trying
their best to save more. "It is not from the benevolence of the butcher, the brewer, or the baker,
that we can expect our dinner, but from their regard to their own interest," (Smith 1776). I
remember receiving only half of my pay due to government issues back in 2011. After a few new
bills and laws were passed by congress, I was able to receive my full pay later on that year.
“There is only a transactions demand for money; it can serve no other purpose besides
purchasing goods, and it is desired not for its own sake, but for the sake of what people can
purchase with it,” (Sowell). Nobody needs or really thinks about money until it is time to pay or
when buying something.
Some of the things that Smith would have notice is that the cost of living is way higher
now than what it used to be. Due to the rise in taxes over the years, we starting to see the effects
of it more and more every day. “The heavier taxation made necessary by the existence of a large
national debt as a serious disincentive to efficient production at home and a reason for some
capital to move abroad,” (Sowell). Even though the economy was bad, but slowly improving
over the years, America has still found a way to build, develop, expand job, and survive through
this hardship.
“A man would invest his wealth in the enterprise most likely to help him earn the highest
return for a given risk level,” (Blenman). People are risk takers, and at times, we are willing to
risk it all just to gain a profit that exceeded the risk given. Sometimes man needs to reevaluate
the risk to see if it really is worth the reward they are seeking to receive. “One man undertaking
the 18 steps required to complete the tasks could make but a handful of pins each week, but if the
18 tasks were completed in assembly-line fashion by ten men, production would jump to
thousands of pins per week,” (Blenman). Today we are still finding better ways to get the job
done faster, and to push production by assembly-line precisely with zero defects. Everything that
Smith was speaking on in the 1700s, is still place into perspective today. We have added to his
theory, but the majority of his statements and facts remain the same. “It is the great
multiplication of the productions of all the different arts, in consequence of the division of labor,
which occasions, in a well-governed society, that universal opulence which extends itself to the
lowest ranks of the people,” (Blenman).
“How selfish so ever man may be supposed, there are evidently some principles in his
nature, which interest him in the fortune of others, and render their happiness necessary to him,
though he derives nothing from it except the pleasure of seeing,” (London). In other words,
during life, at times, it may become every man for himself. Even when things may seem well,
there is always that one individual that wants more than everyone else. Greed will always bring
out the evil in certain people. For an example, some of the richest people in the world are still
trying to find ways to make more money than what they made a year ago. Some people are never
satisfied with what they already have achieved through success. “The worker “has no occasion to
exert his understanding or to exercise his invention”, and consequently “becomes as stupid and
ignorant as it is possible for a human creature to become,” (London). Have you ever wondered
how some things were created, but it did not have a true reason to why it was created?
Everything or every moment in life has a purpose, but some things that I see, I still wonder what
is the reason or the purpose for this idea?
“Despite a penchant for dogmatic assertions, the classical economists had the saving
grace of inconsistency which allowed them to recognize exceptions and modification and even to
quietly incorporate some of the views of heretics once orthodoxy had been vindicated,” Sowell.
Most things that we see or hear about today, were originally created from someone in the past.
We must acknowledge the fact that history really does repeat itself, and that we just finding other
ways to improve what have already been created. “A transfer of any given sum from the one to
the other could never diminish the collective wealth of the whole,” (Sowell).
References
Blenman, J. (2016). Adam smith: The father of economics. Investopedia. Retrieved from
https://www.investopedia.com/updates/adam-smith-economics/.
Genetski, R. (2011). Classical economic principles & the weatlth of nations, book I:
Classical principles. Campbell, CA: FastPencil, Inc.
Krugman, P. (2009). How did economist get it so wrong? The New York Times Magazine.
Retrieved from https://www.nytimes.com/2009/09/06/magazine/06Economic-
t.html?_r=0.
London, C.W. (2013). Smith’s word. Economist. Retrieved from
https://www.economist.com/blogs/freeexchange/2013/11/economic-history.
Sowell, T. (2007). On classical economics. New Haven, CT: Yale University Press.
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