Who Shall Assist the Poor? An Inquiry into the Role of Markets, Private Charity and Government
Birch uses the writings of Adam Smith (The Wealth of Nations and The Theory of Moral Sentiments) to frame some of the economic, psychological and ethical issues regarding how best to assist the poor. First, the competitive free market perspective that economic growth provides a "rising tide that lifts all boats" is considered and related to contemporary China. This "Invisible Hand" perspective is juxtaposed against a less well known problem that Adam Smith recognized, namely the tendency of the poor to conceal their poverty (for fear of social disapprobation) and the rich to segregate themselves from the poor. This creates what I call an "Invisible Poor" problem and has implications for whether or not private charity is sufficient for assisting the poor. Finally, the role of government in providing assistance to the poor is considered, an option that Smith did not rule out although he was critical of the government policies in existence during his time yet relevant to the current U.S. welfare policy debate. Using Smith’s own economic and ethical thought and invoking the work of modern economists (e.g., the concept of "public goods") a case is made for the government to assist the poor although the precise type of assistance and the complementary role of private charity and markets is a fertile topic for debate. This program was developed as a part of the University Dialog Program.