Changes

Just as Isaac Newton’s discovery and explanation of the unseen force of gravity was a brilliant insight in science, Adam Smith of Scotland discovered a powerful unseen force in economics known as the “invisible hand.”  If government allows free enterprise to flourish on its own, without interference by government, then an “invisible hand” harnesses the power of self-interest for the overall good of society.  Companies are guided by this “invisible hand” to work in a way that is beneficial to others, and the overall wealth and progress of society will increase.  This is what Adam Smith wrote in the influential ''The Wealth of Nations'', published in the same year as the Declaration of Independence in America:  1776.  Adam Smith’s book is still considered the world’s greatest economics masterpiece.  He explained how the basis of wealth is found in a free economy with an unregulated exchange of goods, whereby the supply of goods and services responds in an efficient way to the demand of the public without government intervention.  Smith advocated the concept of laissez faire, which means “allow to do” or, more simply, “hands off” by government.  Ironically, homeschooling in New Jersey (and a few other states) is an activity that most resembles Adam Smith’s ideal of an unregulated market.  Let’s defend this lack of regulation of homeschooling while we can!

Just as Isaac Newton’s discovery and explanation of the unseen force of gravity was a brilliant insight in science, Adam Smith of Scotland discovered a powerful unseen force in economics known as the “invisible hand.”  If government allows free enterprise to flourish on its own, without interference by government, then an “invisible hand” harnesses the power of self-interest for the overall good of society.  Companies are guided by this “invisible hand” to work in a way that is beneficial to others, and the overall wealth and progress of society will increase.  This is what Adam Smith wrote in the influential ''The Wealth of Nations'', published in the same year as the Declaration of Independence in America:  1776.  Adam Smith’s book is still considered the world’s greatest economics masterpiece.  He explained how the basis of wealth is found in a free economy with an unregulated exchange of goods, whereby the supply of goods and services responds in an efficient way to the demand of the public without government intervention.  Smith advocated the concept of laissez faire, which means “allow to do” or, more simply, “hands off” by government.  Ironically, homeschooling in New Jersey (and a few other states) is an activity that most resembles Adam Smith’s ideal of an unregulated market.  Let’s defend this lack of regulation of homeschooling while we can!

“Capitalism” became the prevailing economic theory in Britain as a result of the insights of Adam Smith and others.  The Merriam-Webster online dictionary defines capitalism as follows:  “an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market.”  Britain quickly became the largest and greatest empire in the history of the world as a result of its adherence to this superior economic system.  The British empire was larger than even the Mongol empire, except that the British empire was not "contiguous" on land, but included faraway places like Australia.

“[[Capitalism]]” became the prevailing economic theory in Britain as a result of the insights of Adam Smith and others.  The Merriam-Webster online dictionary defines capitalism as follows:  “an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market.”  Britain quickly became the largest and greatest empire in the history of the world as a result of its adherence to this superior economic system.  The British empire was larger than even the Mongol empire, except that the British empire was not "contiguous" on land, but included faraway places like Australia and India.

   

   

A related economic theory known as “mercantilism” also became popular.  Mercantilism was a policy for a nation (such as Britain) to increase its own national wealth based on trade with other nations and territories.  Under mercantilism, a nation should accumulate gold by exporting more goods than it imported, and by using colonies (such as the English colonies in America) to ship raw materials to the mother country that could be manufactured and exported to other peoples.  Another key component of mercantilism was establishing foreign trading monopolies that would have unfair advantages over competitors in other countries.  One such British monopoly was the East Indian Tea Company, and its unfair business advantage caused the colonists in Boston to revolt in the form of the Boston Tea Party.

A related economic theory known as “mercantilism” also became popular.  Mercantilism was a policy for a nation (such as Britain) to increase its own national wealth based on trade with other nations and territories.  Under mercantilism, a nation should accumulate gold by exporting more goods than it imported, and by using colonies (such as the English colonies in America) to ship raw materials to the mother country that could be manufactured and exported to other peoples.  Another key component of mercantilism was establishing foreign trading monopolies that would have unfair advantages over competitors in other countries.  One such British monopoly was the East Indian Tea Company, and its unfair business advantage caused the colonists in Boston to revolt in the form of the Boston Tea Party.