This was the system of the Physiocrats, as they were called, which was introduced by Quesnay, a French physician of the time of Louis XV.; and it numbered among its adherents, Turgot, Morellet, the elder Mirabeau, and many of the most distinguished men of the time. Now Adam Smith, who with Hume had kept himself all along closely in touch with French thought, was so completely swept off his feet by the plausibility of this new system of Political Economy, that he gave himself no time to dig more deeply down to the absurdities which it concealed, but, as we shall see, practically swallowed it in all its essentials. Now, were I to affirm that the orthodox Political Economy of the present day is but a developed form of this old system of the Physiocrats, I should be met with a stare of mingled amazement and incredulity; for by the orthodox Economist this system is regarded as being as dead as that of the Mercantilists which it superseded. And yet I should be quite right in my contention; for the difference in essential principle between Adam Smith and these Physiocrats, - as we shall see, in spite of the elaborate affectation of disagreement with which he drew up his objections to their system in detail in a series of four or five propositions, - is infinitesimal.

So deeply, indeed, was his 'Wealth of Nations' permeated through and through with the principles of the Physiocrats, that he distinctly declares that their system "with all its imperfections is perhaps the nearest approximation to the truth that has yet been published upon the subject of Political Economy."

But if this be true, how, the reader will ask, do I account for the fact that Modern Political Economy traces its pedigree back to Adam Smith, instead of to this discredited, superseded, and now quite forgotten system of the Physiocrats? The answer is simple. Adam Smith like the thoughtful, careful, and laborious student and observer he was, devoted years of his life to going about among the landlords, capitalists, government officials, bankers, and men of business generally with whom he had acquaintance, or to whom from his position later as Commissioner of Trade he had easy access, and ascertaining from them personally, or from the statistics with which they supplied him, all kinds of existing business relations between landlord and tenant, capitalist and workman, all sorts of details of banking and retailing, of the profits of stock and the wages of labour in different employments, as well as the causes of their differentiations, and so on. And these he proceeded to generalise much in the same way as the thoughtful special correspondent of a newspaper in the present day might do when sent out by his chief to report on the methods and results of the different specialists in their several departments, - whether of trade, of manufacture, of agriculture, of science, or of art, - for the benefit of the general public who having practical experience of their own particular walk in life only, are anxious to get some general idea of what, why, and how other men are doing in theirs.

And these general principles and methods, supplemented by carefully thought-out reflections on currency, taxation, governmental regulations, tariffs, colonial management, and the like, Adam Smith, when he came to write his book, proceeded to set in the general framework of principles directly drawn, as we shall presently see, from the system of Political Economy of the Physiocrats, with which they seemed in his mind of all systems best to harmonise. But the reason they seemed to harmonise so well was, that the facts and the theories were at bottom the two complementary aspects of the same thing, - namely of the general condition of industry before the age of machine production. The theory of the Physiocrats, in a word, was but a superficial generalisation of the facts, while the facts lent a superficial gloss to the generalisations of the theory. The theory and the facts fitted each other much in the same way as the rules of grammar or of music in a particular age or stage, reflect the practices of the accredited writers and musicians of that age or stage of development of these arts; but the result was neither a Pure Science nor an Applied Science of Political Economy which would hold true for any and every stage of industrial development, and under all political or social conditions, but only for industry at a particular stage.

And the consequence of all this for Adam Smith and the future of Political Economy was this, - that his successors struck by the range and accuracy of his knowledge of different businesses and industrial employments, and the superficial harmony which obtained between his theory and the facts of which it was but the summary and shorthand expression, embraced them both as parts of a single harmonious whole, and transferred the encomiums, which justly pertained to his admirable digest of industrial facts, to his theory as well; not perceiving that the theory in which the facts were encased really belonged to the Physiocrats. And with this further result, that when industry had entered its full-fledged stage of machine production, and the increase of the wealth of the nation proceeded, as we have seen, on a different and even antagonistic principle, his successors, now that his name had become a classic, clung to his abstract theory, which was reallv in its essence that of the Physiocrats, developed and expanded it, and stamped it with the hall-mark of academic orthodoxy, at the very time that they were repudiating the abstract system of the Physiocrats in its raw state, as crude, antiquated, and obsolete.

So that it is really this system of the Physiocrats, disguised by the superficial modifications which we shall presently see Adam Smith made in it, which dominates the Political Economy of the orthodox schools to this hour. But as it would be unfair to the illustrious memory of Adam Smith to leave this imputation undemonstrated, I propose to pause here for a moment to consider in detail what their theory was, to point out the minor matters in which Adam Smith differed from them, and to connect their theory with that of the 'Mercantilists,' as they were called, who preceded them; and so by linking up their doctrines both with those which preceded and those which followed them, to make the evolution of the science more complete. By this means I hope still further to exhibit the impossibility of those who believe in the doctrine of Evolution ever going back to the Eighteenth Century for any body of distinctly human doctrine whatever, - and not less so for Political Economy than for any other subdivision of the Science of Civilization or Sociology. For the doctrines both of the Physiocrats and of Adam Smith being but the superficial reflex, as of a signet ring, of the industrial conditions of the particular time in which they lived, and these conditions, as we have seen, having almost entirely passed away, the doctrines which correspond to them ought long since to have passed away also.

Why they did not do so, we shall see in detail as we proceed.