>> what i don't think has been nearly enough appreciated is a huge importance of smith's revolutionary, revolution in the understanding of principles of human nature, hume skepticism that is to say. not in his religious skepticism but his philosophical skepticism. and its importance in shaping hume's own agenda for the science of man. and clearly i am concluding at this moment, mr. chairman, i do think that what is interesting is think about smith as a man who in many respects completed and extended that extraordinary project of creating a science of man which disregarded religious principles altogether. and it is that that i've try to remember him in this book. thank you very much.

[applause] >> very good, very interesting. now if professor philipson's talk has stimulated a new a desire to buy this book, man, i'd like to read this book, it's pretty reasonable, here's what the book looks like. this is what your looking for. if you say to me aren't you engaging in famous marketing? my response would be i don't think adam smith would mind? >> onto our commentator, james otis is join professor of lawsuit in economics at yeshiva university in new york and the charles fellow seen at the fund for american studies in washington, d.c.. he received a ba from the university of notre dame, m.a. in velocity from the university of wisconsin milwaukee, and advanced degrees including ph.d from the university of chicago.

he tom purtzer at georgetown university and at the university of alabama. he is the author of adam smith marketplace of life, 2002 from cambridge university press. the 2007 templeton enterprise awards. he is the editor of the levelers there i know we are against them but i guess that's probably not right. you can always get straightened out that these things. and he's also the editor of adam smith selected philosophical writings which appeared in 2004. his book "adam smith" will be publishing 2011 and is working on a book and he is very industrious, don't you agree, he's going working on a book. would you please welcome jim otis and. [applause]

>> thank you. it's a pleasure to be here. as you all well know, adam smith is one of the most beloved and the most hated, the site and it probably for that reason the least read figures in the pantheon of great western writers. his ideas have helped transform political and economic policy throughout much of the world, and his ideas are credited by many for the astonishing and unprecedented growth in wealth and prosperity in the west, but they're also blamed by many for the inequalities in wealth that have arisen since smith's time. so we can have today the interesting spectacle on the one hand, a deirdre mccloskey who argues that adam smith's ideas have led to more good for humanity then arguably any single other -- that way i can see you better -- any other single person in history of humankind. and on the other hand, we can have a jeffrey sachs who suggest

that smithy markets have led to an equity exploitation and environmental degradation. and all of us accomplished by socially awkward 18th century scottish philosopher who wrote after all only two books his whole life which is hardly enough to get him a full professorship in an american university these days. so this is just something of a puzzle. who really is this person, adam smith? what were these momentous ideas, good or bad? how could a person in obscure profession in an obscure place, in an obscure place, and it's your time have brought such tremendous effect on the world? there's been as one might expect quite a range of writing on adam smith from all manner of perspective and for full disclosure i myself have contributed to that. and smith has been appropriate by many people including entire academic disciplines, political parties, schools of economics, by moral agendas, all who serve their own purposes.

so to make one wonder reasonably whether one might get a true measure of the man. where can one find an account this smith that one can trust, an account at sketches this ideas and traits, with due and proper wrecking a smith's time, places, friends, experiences, while professor philipson spoke is an excellent place to start. i have to say professor phillipson's book represent quite an achievement. i couldn't have pulled off a present a credible discussion of smith's ideas that bounces on one and the demands of scholars like me for precision, covering as, conferences and all of the scholarly apparatus, with one and then the demand of non-scholarly readers for a book that tells an engaging, a compelling story. professor felten has managed to do what some would've thought impossible. he tells an interesting story about an economist. [laughter] >> hats off to you.

in truth as professor phillipson himself pointed out, smith was much more than just an economist. he was a moral philosopher. that's what he called himself. this moral flaws were sought to extend the principles that animate all human behavior. he spent his college life trying to discover and describe these principles and in so doing he articulated not only a conception of human social institution grounded on empirical observation and the plausible naturalistic picture of human psychology and human nature, that he also delineate a methodology for research about human society that would set the agenda for new and future disciplines of the social sciences. he was a first great social scientist. now professor builds and reconstructs smith's achievement on by looking the key principles of human behavior and social science that smith discovered by also explaining both what smith take some and how he departs from others. so you get in this book and its relationship to his teacher,

francis hutcheson, you also get flushed out conversations of the reliance on the department of other major figures of the time, david hume, keynes, adam ferguson, russo, edinburg the statute is just outside, all of these players to into the story, allowing the reader to make sense of the complicated constellation of stars that made up the scottish enlightenment. while professor phillipson has done i think is explained in clear and this can be emphasized too much, readable prose, smith's project as it found expression in the lectures he gave and the sec road, in a learned society join, the french he kept and, of course, the two books that he published. in philipson sans smith becomes a social scientist. a brilliant mind trying to understand what institutions are that lead to human happiness and flourishing, combined with the

generosity of soul that smith had as a person severely committed to using his discoveries to help remove obstacles to the well being of the common man. it is an inspiring story. i say that in all sincerity. it's skillful telling justifies recommend that you read it. since part of my duty as a commentor is to point out and criticize the fall of a book, i spent some time looking for fault as i worked through phillipson's book. unsigned report i had a hard time finding any. this is partly due to the fact that phillipson's interpretations of smith's ideas are very close to my own, so that is a discovery that is very happy to make. steel for the sake of discussion let me point out a few things, i won't call them criticism, maybe gentle suggestions. first, as a philosopher i feel duty-bound to raise the thorny issue of the so-called is ought problem. this problem, this is ought problem relates to the logical

fallacy of deriving a normative statement, or an odd statement, one ought to do this or ought not to do this, from a descriptive or is statement such and such is the case or is the fact. it was smith's friend david humidor particularly this fallacy in history as of human nature, remarking that he knows the frequency with which moralists would go from describing a certain state of affairs to me to be drawing moral conclusions or moral injunctions from them. that hume noted that doesn't quite work logically. one can describe all the factual details of a murder, for example, without thereby determine any specific moral conclusion to draw from it. the moral value is something else that has to be added. one can go from one to the other. i raise this now because smith seems to have had a foot in both the knowledge of and the descriptive camps in both of his two books. and it's not quite clear or at least its not uncontested how he resolved this.

in phillipson's account of smith discusses in "the theory of moral sentiments" the impartial spectator as both as a horrific device the people in fact employ when deciding what to do. so if you want to did know what you're currently doing is the right thing for the wrong thing, you asked yourself what an impartial observer of your conduct within. would such an observer of proof, with such an approver -- observers disapprove? this will give you a guide as whether or not to do it. on the other hand, according to phillipson, smith also uses this impartial spectator not just as a description of how effective will make decisions, but how they ought to make decisions. to be a moral person you should listen to this voice of the impartial spectator. that raises the question of what exactly is smith doing in "the theory of moral sentiments"? is the moral psychologist who is married is driving his empirical findings about the phenomenon of human moral judgment making? or he's also a moralist who is

making recommendations about how people ought to live. it seems he is at least the former, argued that the latter as well but the question is how do they go together. i'm sure professor phillipson has an answer but we would be interested to hear what it is. similar issues in "the wealth of nations" at what smith declares it is not from the benevolence of the butcher, the brewer or the baker can you recite this fine with me? it is not from the benevolence of the butcher, the brewer or the baker that we expect our dinner, but from the regard to their own interests. that sounds like a descriptive statement, and as some have said a rather cynical one. but one might ask the question, perhaps that is how we often to be a bit is that how we should behave? so the question again is what kind of claim is smith making? is he describing the way human beings tend to behave or easy making a recommendation? so my first gentle suggestion to

professor phillipson is it would be nice if he addressed the issue and try to sort it out one way or another. that are a handful of other important topics to which one might wish to phillipson had given more than just i'm not or cursory attention. i'll mention one. and that question is how can one reconcile smith's argument for free trade? indeed in his own words, smith very violent attack on the whole commercial system of great britain. that's smith's words. how can one reconcile this as professor phillipson describes it correctly i had, smith's vigorous in exacting event punctilious fulfillment of his duties as the commission of customs for the last decade or so of his life. in other words, how can one square the fact that smith argued for the abolition of tariffs, quotas and other impediments to trade with the fact that would give the opportunity he applied and exacted exactly those things was great enthusiasm, perhaps even

with relish. in 1773 smith was offered the chance to become a tutor to the duke of hamilton. he turned it down and instead in 1778, he became the commissioner of customs. as phillipson rightly notes it was surely a mistake, those are phillipson's words and i agree, to turn down hamilton offer because the job of commissioner of customs consume more and more of smith's time, and it also negatively affected his health as well. as a result it probably prevented him from completing the great and large and tragically never published project of the philosophical project he'd been working on at the end of his life. instead smith connected history of liberal sciences and elegant arts at his executives describe it, i wished work for many years was never brought to fruition, and instead is note the manuscript as professor phillipson recounted a few

minutes ago, were burned at his direction only a few weeks before he died. so why, one would like to know, with smith not only take a job that seemed to conflict with his principles, but also prevented him from bleeding projects that he loved and believed in. and i would guess that no one would be any better position to address these questions and professor phillipson so i'd be interested to know what he thinks. and on a related but perhaps more philosophical note, one might ask you one should understand smith's endorsement of free trade in "the wealth of nations," and also his endorsement of limited government with its pervasive doubts about the competence of modern government on the one hand, with on the other hand is rather long list of duties that smith in various places suggested were the sovereigns including i might add, frequent and gave public diversions. is how do these things go together? in the interest of time, i have some of the examples but if perhaps the issue that professor

phillipson raised about religion is an interesting one, whether smith in back retain his religion on one hand and what role religion or god play in the "the theory of moral sentiments" or a wealth of nations is a second issue, i'd be happy just discusses in the question and answer session. another issue that i myself have written about but i was quite interested to see that phillipson did not vote was the so called adam smith problem, some of you may be interested in the discussion of that or even what that is, professor phillipson didn't discuss this in his book. but i would like to close my remarks by pointing out what i found to be one of the most important and even enlightening lessons from phillipson's book. professor phillipson at the end of the book rights that smith's wealth of nations, quoting him now, quoting professor phillipson can is the greatest and most enduring monument to the intellectual culture of the scottish enlightenment. that's quite a statement. i'll read it again. the greatest and most enduring monument to the intellectual

culture of the scottish enlightenment. if you know something about the astonishing production of human knowledge it in a whole range come indeed virtually every area of human learning that when i drink the scottish enlightenment, to locate that book as a great achievement, that's quite an important and strong statement. but i would like to say about that, phillipson's book show it is not unfair to say that the story of the scottish enlightenment actually parallels and reflects the story of adam smith himself. indeed, the story of the scottish enlightenment is a deep and profound sense of the story of adam smith. now, given how profoundly our own world has in turn been shaped by the ideas that came out of the scottish enlightenment, i think we can say that smith's story is the story also of us. so to understand adam smith is to understand ourselves. phillipson's book provides a deep and thorough picture of a complex life of adam smith and his integration into this

astonishing period of learning that we know in the scottish enlightenment, and in so doing i think phillipson's book ends up fighting and illuminating and surprisingly timely window onto our own place in the world today. thank you. [applause] >> k. we vetted very good for them here today. this is an extraordinary thing. and now we're going to cap it off with a quick question and answer session. now, as clearly to that i would say please raise your hand if you have a question. please say, you might want to get your name and an affiliation also. and wait for a microphone to arrive because, so we can get the sound throughout. and, finally, please have your comments in the form of a question. and if you want to direct into one or the other, indicates no. the gentlemen here in front. had his hand at the first.

>> my name is steve. no real affiliation to the attorney. i wanted to ask i guess both of you, what do you think any way adam smith could be considered a forerunner of the austrian school? and when i say that, i mean the kind of method of deductive reasoning that the austrians embraced versus the experimental models that have come up afterwards. the question is, and you think you pretty much embraced in a fortiori deductive reasoning method as opposed to a scientific method? >> both gentlemen. but first our author.

>> i think the short answer is no, what he can be seen as a forerunner to the austin school of economics. that's not to say that they won't at the end of the day and agree on many aspects of what the proper scope and function of the government is, for example. but smith was anything but. he was much more of a grounded and in peter gleick oriented philosopher. indeed, that's one of the main characteristics i would argue of the scottish enlightening or the scottish historical school of method that smith and hume and others are implemented a. if you want to know what's of government you should have, if you wanted a human societies were, go and look. see what difference because after all, the panoply of human experiment that there have been, offer quite a range of human experiments. go see comical look at them and see what has worked and what hasn't worked that i think that

typifies the approach of adam smith. that's not to say he wouldn't be an agreement with, say, well, a historical figure. smith read john locke, read the second treatise, was fully conversant with the tradition that a lockean would have represented where we at certain principles of human nature and natural laws to reduce from that the proper scope of government. that just wasn't his approach. so they may well have agreed in a conclusion but it would've arrived at them in very different ways. >> i think one of the things that it's often forgotten with "the wealth of nations" is this year, the consequences of the sheer richness of that book. and it very much, it tends to encourage speculation about what might smith have thought about something, as well as what smith did think. now, i make that distinction because smith it seems to me is extremely careful both

methodologically, as an executive in writing "the wealth of nations," to produce an analysis which explains why we have got in western europe basically, in french and british civilization to the stage with got at present. and his method doesn't allow him to form the principles of the more general than that. the humane underpinning of his thinking, the historic cysts, the store assist history i was a comic character of his reasoning does not allow him to explain anything more than the dilemmas and problems of governance that exists within his own society. the trouble is in doing that, he raises all sorts of general

questions which may or may not apply to the experience of civilization line beyond his own reach. and i think it's very interesting, one of the things i tried to do, i may say many goes riding my chat on "the wealth of nations" was strictly -- strip the announcers back to what smith was claiming he could throw light on, as political economist with a sense of public duty. and he's very careful about stopping the arguments at the point beyond which only the imagination can take us. and only utopian can go. and in that respect i don't see much, though i say i'm a poor economies, i don't so much see smith's affinities lie with the vienna school so much as -- with i'm afraid, keynes. well, i'm sorry.

[laughter] >> all sorts of hands have gone up. >> i know. the frame of mind, the frame of mind, the execution in terms of government, the frame of mind has much more in common with that of keynes that i think is more realize. >> we'll leave that hanging for a moment. the gentlemen in the second row from the aisle. right here. >> professor phillipson, what things did you learn while writing this book that you didn't know about previously, or things that added to your understanding that surprised you? >> the relationship with hume. i've always been intrigued by the relationship between hume

and smith, as anyone is bound to be. it's the depth of that relationship. and the thing that i must say really got the text moving, as far as i could see, was when i try to present smith as in fact an extremely friendly, and intelligent critic of hume's project for science of man as set out in the human nature. it is very interesting to reflect on what it is that smith does, almost certainly at the very beginning of his career, and continued in glasgow. to read these as developing, for recently probably don't really know about tom smith never

thought of doing. why is there no theory of light which in a tree dies of human nature. hume science of man depends upon a theory of language which will privilege and understanding of discourse, conversation and all this, doesn't produce one. smith does. again, the historicism, the fact that hume has an understanding that our ideas of justice and, therefore, am rally, legal obligation everything, will very in different types of civilization. but he doesn't work it out. i mean, he makes these distinctions are there in his early work but they are not developed. smith came over to me as someone who is developing these in the most brilliant way. and that i think was the most

exciting thing for me to be able to develop and then to carry that through but it's an interesting question accident it really is. >> the woman right here. >> my name is rosalyn blakesley maclennan and i'm a theater reviewer for d.c. theater. i just survived a very successful run here, a musical which bernstein continuously revise because he couldn't quite figure out what voltaire was trying to say. but that's my basic question, is do you explore address this relationship with the french and what was going on in france at that time? especially between 1750 and 1770 you have to help me out here, there was a movement,

physiocrats. yet and this idea that you can guarantee individual liberty but you can't guarantee the results. and there's this delightful numbers in the musical, you know, the best of all possible worlds, but he makes outrageous fun of both the beliefs, to him, retake his belief that came out of the indictment. this is the best of all possible worlds where there's an earthquake in lisbon, people are in dire poverty, and what's the use if you, of all this dishonest endeavor at being so clever if you just have to pass it along, pass it along, pass it along. you just pass it along? >> well, i must say i wish i had seen this version.

there was another version approved by bernstein himself, in scotland a few years ago which was vastly intriguing. all sorts of things happen to appear but i'm not sure that i think it is -- i think it is a pretty free go at boulder. will alter himself would've said about this i don't think, would have undoubtedly been memorable. but the point was at his that i think it is important to remember, although ballplayer does not appear on the surface as a player in any of his debates with french, or let alone the physiocrats. he does not let it all. but that does not mean that voltaire is not there, and smith owned, he bought, he met

voltaire and he once told one of his students who start to criticize voltaire, he said there is only one voltaire. and he fought magnificent. and what that reminds me is, this is smith on the voltaire as the anti-clerical. it's very interesting that in this classic confrontation between the enlightenment and religion, and all the classic implications, all of that, that does not appear on the pages of smith at all in the way it does with hume, hume anti-clericalism, his religious skepticism is constantly resurfacing in his writing. smith, it never is. and one of the very interesting things, questions to ask about smith is why, when he has

adopted a philosophy which, in fact, argues for the irrelevance, philosophical irrelevance of theology, why in fact, and when there is very little doubt that he had, that he was alarmed by the consequences of clericalism that hume, voltaire or anyone, why he does not allow to intrude into the center of his philosophy, but he doesn't. >> i think he does. in the following way. he does mention voltaire and he does, smith does, to answer your first question, he does discuss smith connection to the french enlightenment. i think there is way in which voltaire has figured in a dismissive political and philosophical program. at least i would suggest we consideration. and that is followed. unit at the end, i haven't seen

the musical but in the book, one of the lessons is to attend to one's own garden. this i think is a powerful insight, and it figured mightily in smith v. classing of political philosophers. indeed, the extent to which our policymakers and legislators should no longer imagine that they can apprehend the good with a capital g. the way plato had imagined the political philosophers would do and then organize the entire state from top to bottom entrance of the conception of the good life. instead we are to do is to create a framework in which individuals can 10 to their own garden that we can become a nation of shopkeepers asset in "the wealth of nations" and that's all right. you manage your life in the best way you know how, given that housing opportunities you have, and the values that you have whatever they are, the state's job is to provide a framework in which you can do that to the degree possible, unmolested by others that you don't want to be molested by.

and that's in a sense, i think that's the transformation of the idea that were as god might be the monarch and, the next room, and voltaire wants to get rid of that as well. pharr smith what we're doing in this realm we are taking the political leaders, the magic of the legislators who imagine themselves as something like secular does. and bringing them down and say no, just last have a framework and we will lead our lives on her own, thank you very about what i think that is a powerful idea, if certain figures in smith but i wouldn't be surprised, i would suggest to professor phillipson that voltaire might've been one of the sources of this idea. >> okay. did you want to say just a bit more on that? >> i mean, i completely agree here he said it very elegantly. i just don't, i don't see that it has roots in voltaire. it belongs to a family of views,

but -- exactly. if i had to track and making the thinking i wouldn't feel the need to drag voltaire into it. [laughter] >> there may be other reasons for that. >> we don't care just as long as keynes doesn't show up again. [laughter] >> i believe smith was, studied mercantilism you mention. he really studied capitalism, and i believe he also originated the term die with people, and interpreted profit. and to get rid of the surplus value, you have to export. i think that was one of his prime contribution, "the wealth othe wealthof the nations. and we see today that china is a principal exporter and the u.s. is a tremendous deficit in the balance of trade. so would you say that china is a great follower of adam smith and

the u.s. is a poor follower of adam smith? >> adam smith is certainly red in china. i may say i hope you get a chinese translation to my book. but i very, very much doubt whether the present government, the government for the last half general and in china has actually been sitting there with copies of "the wealth of nations" on the desk. i think the intellectual history of policy formation and respect to the management of trade in china over the last 25 years is much more complicated than that. and i suspect extreme interesting, but as i say i'm no economist, a much more multifaceted and not necessarily

exclusively pragmatic approach to the management of trade. but as i say, that is from an economics amateur like myself. >> may i say something? i would suggest that in the last 30 years or so, china has been quite surprised at the chinese communist party should have been quite surprised the extent to which adam smith's ideas have worked. what they've done has effected a small untargeted ways areas in which smithian style markets have been allowed to operate, giving people property rights, allowing them to do with their profits as they would like, and to exchange the surplus value and surplus goods and they would like, and look at the astonishing growth and production that has enabled. i think it's been very calm is the chinese communist party turning into a smithian style, if you like, pragmatic liberals

government? no. on the other hand, are they coming, perhaps some of them grudgingly to the power of markets and the good they can do, yes, i think a certain our sing the. >> may i make one more comment on that? i think one of the things that we don't take enough account of in smith is precisely what he means by markets. now, if you look at the modeling of his discussion of markets, it's essentially can he is taking essentially a regional view of what the market is. he is thinking of the interplay between town and country. >> but also between countries, which is a? >> yes, but the notion of moving, these are the two problems on which he operates. but it seems to me that there's some real ambiguity, and it's interesting ambiguity about what he means by a national market.

and i think, i suspect although this is speculative, that there may be very good reasons for that. i mean, was there a scottish market? was there a scottish economy? was it legitimate at all of scotland as a particular market? well, it was in some respects, they say in relation to the workings of the tobacco trade, impossible to live in. but on the other hand, just what the nature of that market is. when you move between the markets that is recognize by the simple act of interchange between town and country, and the sort of market that is determined by in fact customs regulations and operating individually, i find myself wondering just what smith meant by market in that respect. whether or not it matters economically i don't know, but

for some of his thinking is as precise usually on these matters, i find that that vagueness is intriguing. and, frankly, i don't know quite what to make of it. >> this gentleman right here is waiting. >> sorry, i have a cold. i'm the author of a forthcoming book with cambridge university press, so i have to discuss some of these issues. i have just one comment and one question. the comment is that the view that adam smith had a very limited role is certainly not correct for the time, this was the enormous expansion, enormous mistake. what he wanted was to redirect the role of stayed away from for more efficient role.

that's my comment. the question is that adam smith had a lot of confidence in markets. clearly this is very central. at the same time he was very skeptical about merchants, lots of statements in "the wealth of nations" and so forth. so my question is, if you were living today, after two years of financial market chaos, what role? >> may i make a preface before you give your answer? i give one a diggen deere, which is smith come he was certainly quite critical of merchants in "the wealth of nations" but he was critical of many classes of people, not just merchants. professors, priests, and other people who use certain kinds of social institutions to their own advantage but that was really i think the crux of the argument, the person he was racing towards merchants. the problem he had with merchants was when they join

hands with ministers of the state in or to protect them from competition, to give them monopolies, give them special privileges which certainly would enrich both those protected merchants and usually indirectly than the politicians who gave him those protections, but always at the expense of the common man. so wasn't just merchants that he was criticizing. does anybody who tried to use the various kinds of social, political and economic apparatus is to enrich themselves at other people's expense your that was my preface. [inaudible] >> i absolutely agree with you on your comment, and i agree with most of gm's gloss on it. i think the important thing is that smith would not have denied there was able for regulation. the question of regulation was one that would have to be taken seriously. the interesting evidence of that

is spent on the role of banking in "the wealth of nations," i got particularly interested in this because he spent some time on scottish banking and a ghastly banking crisis of 1772, end of a boom, a housing crisis, it's quite ridiculous. the thing is that this is -- the question he comes up with in the context of 18th century banking is that these credit shops should actually be allowed to fall. fine. but that is a comment, but the point, i think the point is worth making is that he regards this question of regulation whether there should be or shouldn't be as a highly serious question. and he does not give the universal answer to it. his answer is historically defined by limits of the existing system. we know he took this question seriously because he delayed the

completion of "the wealth of nations" by at least 18 months while he attended to it. so again, the question, i read smith as being essentially beginning, middle and end, a pragmatist in the matter of regulation. but always, always accompanied, and as jim was saying, by an extraordinary, a huge sensitivity to the way in which interest groups operated in relation to parliament, to government, the civil service and to the ministry. >> may i say one other thing? i guess this may be a difference between us. i think smith would be agnostic with respect to a great deal. so what you want to see what what regulations would talk about and what effects. but he's not neutral. i think his reading of human history is that government

intervention tends to reduce productivity, it tends to have various kinds of unintended bad consequences. so i think much of the argument of "the wealth of nations" is for shifting the burden of proof. we want to assume that human beings ought to be allowed to leave their own affairs without third party willing exchanges of others. and less you can demonstrate that there's some very specific reason why in this case that has to be an intervention. so that shift, it's not a principal objection to all regulation. on the other hand, it is an important shifting of the burden of proof. this is what smith has in mind when he talks about the obvious and simple system of natural liberty. what that is, we allow for protections of people's private property, and that's going to be it unless there's some very specific reason why in the burden of proof will then be on you, the proposer of the legislation our intervention to show what everyone would benefit and is not the way to do it other than through third party

or state intervention. so i think it is a shifting of the burden of proof so i don't think he is purely neutral with respect. he's going to view these, any sort of regulars with a measure of skepticism in a sense you need to make your case. on the other hand, if you make a case okay, then you have made your case. >> can i just gloss that just a little? one of the things, someone spoke, jim, you did, of smith as one of the first, the great social scientists. and as such, one of the key interests that cuts through his jurisprudence which is absolutely wonderful such, richly textured, it really is a terrific one, is how do societies reproduce themselves? the analysis is designed to show at every point how in fact a regime that will perpetuate itself, perpetuates its rule and all the rest of it. now, the point is that there's a

paradox built into this sort of realism, if you like to think of it like that. but the more effective in. it rule is, whether it's the chargers or whether it's a few regime, what happens, the better able it is to maintain the rules of justice and to secure regularity, the rules of justice, the more that, in fact, people since what is just and essentially what is there will move around. in any government which then wishes to preserve itself is actually on the long-term going to have to respond to that shift insensibility, the sensibility of fairness, sensibility of justice, the sensibility of what it is the government can provide. and if it doesn't, it will be a problem.

and i think it may be that there is a tension between this sense of sensibility that cuts through the jurisprudence. and "the wealth of nations" because what smith, the analysis allows him to do is to say the fabric of british and french society is changing in ways in which its governors do not fully understand. and here is an analysis which will explain that. this profound analysis. profoundly serious analysis. and what he is dancing is the public interest, and, therefore, the long-term interest of traditional interest groups must be seen as changing. and if it doesn't, there's a french revolution waiting down the road for it. so i would put the problem like

that, and that is, in fact, what underlies his sense, his desire to try to teach a new sort of prudence in the governors of, particularly british but to a lesser extent french society. >> we will in today where we started with the picture of the wall that claimed i think rightly that adam smith was a great benefactor of mankind. nicholas phillipson has written a book about adam smith that is very fine on this great benefactor of mankind, one you want to consider i think for your time for reading. and this great benefactor of mankind i think we have concluded was a revenge a libertarian but a libertarian for all that. please join us for dinner, or lunch upstairs. [applause]

>> well, with federal judges -- $40 of the program and beginning saturday morning at eight eastern through monday morning at eight eastern. nonfiction books, all weekend every weekend right here on c-span2.

>> well, with federal judge jenny chen of the rejection of the 2008 google books settlement, the future of a complete online library is in question. joining us now to discuss this issue is sarah wyman, the news editor of publishers marketplace. if you could begin by giving us a brief overview of what the google books settlement was and who are the parties involved? >> sure. the google books settlement arose from original lawsuit that was filed by the association of american publishers and the authors guild. they object to the fact that thn their view who was scanning primarily out of print and orphan work, those works whose copyright status was not entirely known. and they felt that this wholesale scanning was infringement come and they didn't like that so they sued. as it made way to the court the parties all decide the fate what is known as the google book

settlement. and what that would entail is coming up with some means of giving copyright holders a monetary value for their work. and what they elected to do was to create what's known as an opt out process where the authors did not want their works to be scanned by google, they could write in an opt out there and those who did have their works can by google would get about $60 per work. as it made its way through court, judge chin last heard about this approximately 14 months ago. and then he was confirmed to the second court of appeals to which nobody knew exactly what was going on with a settlement. then when the news came in last week that he rejected it, that sort of create a wave of surprise among many parties and especially in the publishing community. >> what was judge chin's rationale? >> he ultimately believe that the settlement was not fair adequate are reasonable, he felt

that numerous objectives that were lodged by the 6800 authors as well as 500 other parties were substantial enough to rule that the way the settlement was created contravened current copyright law, and that there was perhaps a better way to do with. so in his view he thought the majority of the objections could be multiplied instead of an opt out process, using an opt in process were copyright holders could say no, i want to be part of the settlement instead of assuming that they let you opt out, that you're automatically entered he didn't like that and he felt that this was not a good way of doing it to the other portion that i addressed earlier was related to orphan work. and he felt that the google book settlement could not adequately address this. and instead this was a matter that should be taken up by congress. >> so, sarah weinman, during

this entire legal process, google has been scanning books into its system. what happens to those books? >> that's a very good question and, in fact, because the settlement has now been rejected no one really knows what the next move will be. there is supposed to be a status meeting in court on april 25 at 4:30 at which time i guess the parties are going to stake their claims as to why they should come up with a revised settlement, that's what the aap and the ag are both on record saying that and google will have to figure out exactly what they want. there are multiple ways of looking at it. some commentators say that this actually hurts google because it is put to their scanning ability and out. of the commentators say that no, this impact is fine because and another separate program which is integration of ogilvy books, google is already scanning books that are in the copyright with

various permission that you can go to google's e-book site online and download for a price and current e-book that is probably available for sale. you can go to various independent retailers that our affiliate with the google e-book bookstore and if that would they do it what's known as a partner program for publishers, and authors as well, have opted in in order to make these books available for sale. so there's some rationale that by implementing in instituting this particular program, that this is perhaps a model for what the google book settlement should be. the other thing that is put in limo is the settlement was supposed to greet what's known as a google e-book writes registry. google and publishers that between 12 and 15 million already into getting this up and running. how can you have a writes registry for a settlement that technically doesn't entirely exist? so it remains to be seen, with the aap and the ag relaunch

their lawsuit? will of the parties litigate? will google want to continue the suit? i have a feeling we will know a lot more when the status be happens on april 25. >> now, what was google's reaction and the american association of publishers reaction to judge chin's suggestion that they use an opt in system? >> both the aap and the ag were understandably disappointed that the settlement was not approved, but both parties seem to express some optimism that they could find a way into the settlement. like, for example, mcmillan ceo john sargent issued a statement on behalf of the aap essentially said they are prepared that if the publisher plaintiffs in a very narrow settlement along the line to take a finish of this groundbreaking opportunity and hope other parties will do as well. and scott the robust with a person of the ag, he says along the lines of regardless of what the outcome of discussions are,

readers want access to unattainable works on every market they can get you there has to be a way to make some kind of settlement happened to make these works available. and so they hope they can, in fact, arrived at a settlement. with respect to google, they were as i said kind of disappointed, but they essentially said they hope to be able to continue their scanning work and make as many books available. so essentially i think it's a disappointment but cautious optimism seems to be raining the day. >> sarah weinman, what about google's competitors, amazon, microsoft, yahoo!, et cetera, what was their reaction? >> to the best of my knowledge i think the reactions were mostly lodged with court documents. from what i understand the paper certainly pleased the settlement was not approved because each of those parties or sorting the

majority of these parties did lodge objections with the court to amazon has essentially said if you give google this unfair advantage, how is this good for copyright? that was another big issue of judge chin which is it's a good idea to have a digital library, to have works of scanned, but should google be the arbiter and the decision-maker, the entity that decides how it is scanned, what is scanned, which books are essentially made available. and i think in judge chin's opinion he felt very comfortable that one entity, one corporation could have that much power and an unfair advantage over any other corporate entity or public entity. >> sarah weinman, result in "the new york times" robert doornbos the director of the harvard university library wrote that the decision is a victory for the public good but insisted quote, we should not abandon

google string of making all the books in the world available to everyone. instead we should build a digital public library which would provide these digital copies free of charge to readers. is there any viability to that? >> it sounds like a wonderful idea. yeah, the only entity that has stepped up his google and, unfortunately, especially with the current economic state of play, the priority for a digital public library that was already in progress i suspect is not the highest of priorities. i mean, already look at the money that's just been spent on the rise of registry alone which might have to be abandoned in a worst-case scenario. winning best case scenario taken up. but then who would it be taken up by? google with a market cap they have were really one of the only corporations or own entities, public or private, that has the clout and the muscle to be able to make this happen. so i think ultimately that was

why a settlement was a good idea for the aap and the ag because they recognize there is guided in the work that google did, and he wanted to at least get something off the ground and that could be built on and built on. will the library system be able to come together for a nonprofit entity when they're facing such massive cutbacks at the state and federal level? i'm not entirely certain. so even though there's discipline and cautious optimism about reviving settlement, there's also understandable skepticism that this can happen. so some people are looking at it as a win-win. i'm looking at it as more of a neutral potentially great loss, i suppose, if something doesn't move forward. >> will judge chin continue to have a role in this issue? >> from what i understand he will not, especially now that he has