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Deep Dive: Jon Murphy on The Jones Act and Adam Smith

July 31, 2022


What would Adam Smith do? About the Jones Act, that is. The WN talks about the British Acts of Navigation. What can we learn from them to help us think through modern trade issues? 
In this episode of The Great Antidote, guest Jon Murphy and host Juliette Sellgren discuss what Adam Smith might think about the Merchant Marine Act of 1920 (popularly known as “The Jones Act”) and the limits of free trade. This is the second time the Great Antidote has focused on the Jones Act. The first time was Colin Grabow on the Jones Act in April 2021. If you want to get a more thorough understanding of the Jones Act before beginning to think about what Adam Smith (and Jon Murphy) think you can listen to that first. 

Questions Murphy and Sellgren discuss include: 

  • What is at the root of modern peoples' urge to claim Adam Smith is “on their side” in public policy debates? 
  • What is “free trade” and what’s the simplest case for it?  
  • What is the evidence that Smith would oppose or support the Jones Act? 
  • Was Smith more theoretical or more empirical in his analysis? 
  • How does this all relate to the baby formula shortage? 

Murphy recently earned his PhD from George Mason University and will be starting as an instructor at Western Carolina University this fall. Murphy is also a frequent AdamSmithWorks contributor and even wrote an article which is referenced in the podcast called, “Would Adam Smith Have Supported the Jones Act?”

Sellgren’s opening question, as always, inquires into what one thing people in her generation should know that they don’t. Murphy’s answer is R-E-L-A-X. Murphy reminds listeners that just because the things you see haven’t happened before in your lifetime doesn’t mean they haven’t happened before. Inflation, civil unrest, pandemics are things that people have made their way through before and they will do it again. 

Murphy and Sellgren then talk about the desire to claim Smith for a particular policy position then move into their topic. 

Key Quote: 
Adam Smith is very explicit in the Wealth of Nations. He says over and over and over again, there's nothing more absurd than the doctrine of mercantilism. There's nothing more absurd than the doctrine of the trade balance…but like any good thinker he also realizes that there are exceptions to every rule and he's willing to, at least theoretically, consider these exceptions and build foundations on when exceptions might be appropriate. If you think the old saying that the bow that does not bend will break, that’s Smith. His goal is to build a robust theory of political economy.

The most relevant sections of Smith’s work on this question are Smith’s writings on the British Navigation Acts in the Wealth of Nations. They discuss Smith’s concerns about national security, maintaining military power, the martial spirit of citizens, and the weakening of a nation that focuses too much on commerce and luxury. Murphy also points to some areas where Smith might be impressed with the modern US. 
In closing, we learn about one thing that Murphy believed at one time in your life that he later changed his position on and why. Murphy talks about when to trust what sort of experts. For example, economists aren’t experts on what stocks you should pick but you can learn a lot from them in their more narrow areas of expertise. 

Listen to this episode
Jon Murphy on The Jones Act and Adam Smith

The guest

Related Great Antidote podcasts

More by guest (all at AdamSmithWorks)
Related Liberty Fund content
Additional resources on topics mentioned in the episode

Resources compiled by Christy Lynn


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