The Wisdom of Adam Smith—Even More Relevant Today

No society can be flourishing and happy, of which the

far greater part of the members are poor and miserable.

It is but equity, besides, that they who feed, clothe, and

lodge the whole body of the people, should have such a

share of the produce of their own labour as to be

themselves tolerably well fed, clothed, and lodged.

–Adam Smith, The Wealth of Nations, Book I, Chapter 8, 1776

The people of the United States are living in a period of exceptional division between a rich and powerful minority and a poor and powerless majority.

Much has been written about how this came to be in a country that for much of the last

century was the model of a “democratic” country in which all men (and women) were

equal. Yet there is no consensus about the reasons for this state of affairs and even less

optimism that it will improve.

So . . . I was struck by these words written by Adam Smith when I recently stumbled

across them. Remarkably, they were written 250 years ago—in the same year that

Americans declared their independence from the rule of Adam Smith’s king.

I want you to know how I chanced upon these words. It was in Episode 674 of the

Freakonomics podcast posted on 8 May 2026: “How Does a Composer Feel After the

World Premiere?”

The composer featured in this episode is David Lang. He was being interviewed by

podcast host Stephen Dubner after the premiere of an oratorio that Lang had composed

drawn from Adam Smith’s Wealth of Nations. The premiere was performed by the New

York Philharmonic Orchestra and took place on 19 March 2026.

If it interests you, here is a link to the podcast:

https://freakonomics.com/podcast/how-does-a-composer-feel-after-the-world-premiere/

Stephen Dubner singled out this Adam Smith quote as a key message in Lang’s

oratorio, and Lange agreed.

In my eyes, it is obvious that the American society today is not “flourishing and happy”.

It seems equally obvious that a fundamental reason for this state of affairs is that a large

percentage—perhaps more than 25%—of the roughly 350 million people living in the

USA are NOT “well fed, clothed, and lodged”.

How long can this situation continue? Historically, the answer is not much longer

because over the millennia of past human civilizations, when life for the majority has

become too bitter, the people have revolted against the king or emperor or minority and

created a new and less unequal order.

I’m less sure this pattern will be repeated in the future, however, because humans have

evolved to a point where incredible technological power is in the hands of a small group

of people: the private sector owners/managers of the globally dominant Artificial

Intelligence companies. They may be in a position to perpetuate their status.

I write this as SpaceX, a company owned primarily by one man—Elon Musk—has

announced a sale of its shares (through an Initial Public Offering—IPO) that will yield a

market valuation of 1.77 trillion US dollars. This is the figure one gets by multiplying the

price of each share being sold in the IPO by the total number of shares issued by the

corporation.

Adding Musk’s ownership share in SpaceX to his already great wealth will make him the

world’s first dollar trillionaire, meaning that after adding up all of his assets and

subtracting all of his liabilities (debts), his wealth will exceed one trillion US dollars.

The 10% poorest households in the USA have negative wealth: their debts exceed their

assets. The poorest 50% of households in the USA—roughly 65 million households—

have a combined wealth of four trillion US dollars. I can’t find the exact number, but it

looks like Musk alone has more wealth than the poorest 30 million households in the

USA.

I believe this level of wealth inequality is unsustainable. If I’m wrong, it suggests that in

the future there will be a permanent “underclass” as imagined in apocalyptic novels like

Brave New World and 1984.

The human tragedy is that people alive today obviously possess more than enough

knowledge and technology to feed, clothe, and house decently all 8 billion of us on

Planet Earth.

There could be a solution on the horizon that is not getting enough attention. Fewer

children are being born every year than the number of people who die, and the gap

between births and deaths is widening. This unprecedented trend of depopulation is

occurring so fast that the world’s human population may peak 20-30 years before the

peak year in the 2080s of the global forecast published by the United Nations in 2024.

(N.B. More than 150 countries and territories have GDP less than one trillion US

dollars.)