At the intersection of the original Adam Smith and the ‘net is, well, irresistible territory. And now we have it in the current Forbes, courtesy of P.J. O’Rourke’s "Adam Smith: Web Junkie."
Here’s the thesis, which is indisputably correct:
"I wonder if the know-it-alls at Wikipedia realize that the Internet was fully described and completely understood more than 200 years ago by Adam Smith, founder of free market economics. […]
"In The Wealth of Nations , published in 1776, Adam Smith explained the three factors that constitute the free market: pursuit of self-interest, division of labor and freedom of trade. There you have the Internet without so much as a mouse click. […]
"The Internet is not a wonderful new world. The Internet just is a natural extension of the free market."
But it’s deeper than that, at least to my way of thinking.
Every time I see or read another hyper-ventilating media expose of that old devil the Internet, with its fraud, its cons, its porn, its deviants, and its identity thieves, I can’t help but think of the marvelous, uplifting, inspirational, fascinating, and deeply challenging experiences that constitute my own personal history of exposure to the ‘net.
And in trying to reconcile these views, the answer is really staring us in the face: Humans created the ‘net, and the ‘net reflects us. So lots of traffic (read: attention) goes to news, sports, money, food, family, travel, sex (of course), health, shopping, commerce—you get the idea. I’d wager that the proportion of off-line, "real world" assets and dollars devoted to each of those categories is almost precisely mirrored online.
But back to Adam Smith.
"In The Wealth of Nations Adam Smith said that an individual “stands at all times in need of the co-operation and assistance of great multitudes, while his whole life is scarce sufficient to gain the friendship of a few persons.”
"Smith saw that the free market answered liberty’s need for a larger network of voluntary association. The pursuit of self-interest means that the free market has built-in incentives for network maintenance and expansion."
The ‘net promotes, above all, connections. And this brings us to P.J. O’Rourke’s key, and deadly serious, insight:
"Since networks are self-organizing they are, like all do-it-yourself projects, a mess. This makes networks too hard for any one person to understand, let alone dominate.
"
Most of our lives are spent in channels or chains of command or circuits. Networks release us from this. We are presented with numerous alternative connections. On the Internet these connections are, without intending a pun, virtually unlimited. We can take our business elsewhere or be that elsewhere by starting a business of our own."Networks aren’t egalitarian. Michael Dell always will be a bigger node than we are. But networks aren’t hierarchal, either. There’s no top and bottom to them, no magnetic north of authority. It’s all side-to-side and back and forth. Detours, shortcuts and work-around’s make a network."
In other words, the ‘net permits us to create new connections, to launch new
conversations, and to form new micro-communities neither foreseen nor exhorted by any person or group directing our actions or our attention. Sounds like a free market to me. If, as O’Rourke says, "the Internet is an advance for voluntary association," then Adam Smith would surely approve.
And of course he’d be publishing working drafts of Wealth of Nations online for critical commentary as they were done.
.
