Michael Munger on How Adam Smith Solved the Trolley Problem
Sep 18 2023
Adam Smith, portrayed in video production, An Animal that Trades.

In the original version of a now classic thought experiment, five people are about to be killed by a runaway trolley. Would you divert the trolley knowing that your choice will kill a single innocent bystander? Listen as Michael Munger of Duke University argues that Adam Smith gave an answer to this challenge a few hundred years before it was proposed by the philosopher Philippa Foot and brought vividly to life in the miniseries, The Good Place. Along the way, Munger and EconTalk's Russ Roberts discuss effective altruism, the moral claims of Peter Singer, what the trolley problem really tells us, if anything, and how our moral choices differ according to context.

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Explore audio transcript, further reading that will help you delve deeper into this week’s episode, and vigorous conversations in the form of our comments section below.


Mark Webb
Sep 18 2023 at 1:21pm

A few years back I read about a real-life “trolley problem” incident, where a runaway train in California was headed toward a major population center. They had the option of allowing the train to run off the rails in a low-population suburb instead of waiting for it to enter the urban environment and go off the rails on its own. They decided to derail it in the suburbs instead of letting it get into the city.

I strongly agree with Ross’s point that most of these ‘trolley problem’ hypotheticals fail to account for the uncertainty of real life. We repeat the mantra that “the plural of anecdote is not statistic”, but we often fail to internalize the reverse intuition, that “the average human has one breast and one testicle” and thus reasoning from averages often doesn’t tell us what to do in specific circumstances.

Sep 18 2023 at 2:48pm

“would have been killed in purpose”

Philosopher J.L.Austin would say that the right word is deliberately, not on purpose (nor intentionally):  QUOTE

“Can we think of a case in which something is done deliberately but not intentionally? Certainly this seems more difficult. However, there are cases.

“I am summoned to quell a riot in India. Speed is imperative. My mind runs on the action to be taken five miles down the road at the Residency. As I set off down the drive, my cookboy’s child’s new gocart, the apple of her eye, is right across the road. I realize I could stop, get out, and move it, but to hell with that: I must push on. It’s too bad, that’s all: I drive right over it and am on my way. In this case, a snap decision is taken on what is essentially an incidental matter. I did drive over the gocart deliberately, but not intentionally – nor, of course, unintentionally either…”

J.L.Austin “Three Ways of Spilling Ink” _Philosophical Papers_ p.278

Sep 18 2023 at 3:14pm

Coleridge wrote somewhere (he wrote op-eds for a decade) that moral puzzles serve to weaken the moral sense.

Joseph Martins
Sep 18 2023 at 8:19pm

Loved this episode

… then started watching season 2 of Apple’s rendition of Asimov’s Foundation and it occurred to me

Foundation is really a grand version of Asimov’s take on the trolley problem

Mike C
Sep 19 2023 at 6:35am

Michael Munger is a great guest, and he’s very much welcomed by EconTalk listeners.

With that said, I think his example involving the United States’ decision to use atomic bombs against Japan in 1945 over-simplified the issues of the time to make it appear now as a Trolley Problem dilemma between “use” or “don’t use”.  There was more at stake in how the war ended than merely getting to the fewest casualties for the US and Japan, and like Russ said, reality is usually more complicated than how Trolley Problem questions are posed.

I object to recasting the atomic bomb decision into a simplified Trolley Problem question because it overwrites history, with the simplified explanation becoming a new narrative of why it had to happen.  Trolley Problems pose limited options, whereas at the time, there were more options available, such as “use elsewhere” (on a non-populated area as a warning demonstration) and “use later” (after Russia declared war on Japan but prior to Operation Overlord’s invasion).   Over-simplification trivializes the significance and difficulty in the decision that had to be made in 1945.

I agree with Russ that Trolley Problems are entertaining conceptually but should not be used instructively.  But, they do help sell books …

Matěj Cepl
Sep 19 2023 at 1:59pm

There is a Czech humorist novel, where the main character has an uncle Francis. Uncle Francis owned a chemical factory despite the fact he absolutely refused to learn anything about chemistry from books, and he had to discover everything (like “it is a bad idea to pour water into an acid”) by experiment. After many traumatic events his employees were so twitchy and nervous, that when an employee asked him what would be the result of their then current effort, in one moment of random honesty uncle Francis said “God knows!” (in Czech “Ví Bůh!”, which sounds exactly like “výbuch” which is “an explosion”) and then was much surprised when all his employees jumped out of windows and later quit explaining that they have their duties to their families to provide for and they had chosen to work in safer employment in the next door ammunition factory instead.

That’s exactly how I feel when economists try to reestablish whole ethics from the basic principles. They have their elementary toys, they have discovered that pouring water into an acid is a bad idea, but with this equipment they try to decide whether it was a good idea to bomb Hiroshima and Nagasaki (or to firebomb other Japanese cities).

It is just seventy-eight years since the event and not one year was missed when some large treaties on ethics of that decision (for or contra) was not published. The situation is so complicated that even on rather homogeneous pro-conservative pro-Christian website like First Things, there could be next to each other published articles with completely opposing conclusions (e.g., https://www.firstthings.com/web-exclusives/2020/09/trumans-terrible-choice-75-years-ago or https://www.firstthings.com/web-exclusives/2011/08/does-jesus-really-love-nukes ). Current tools which moralizing economists have in their disposal seem to me like completely inadequate to the task.

On the more positive side. I think the issue of the whole “the man in the breast” issue (and why it doesn’t work in the real life very well, see Russ’ exposé on externalities) is of course one of the core problems here. There is for example whole large body of work in social psychology and sociology (especially among symbolic interactionist sociologist) on what’s there called “the generalized other” (which is quite close to Adam Smith’s man in the breast or for other school of thought, Freud’s “superego”). When you think about it for a second, it is obvious that (aside from people who would claim that it is a spark of the Divine Spirit or something like that; and even as a practicing Christian, I don’t subscribe to this theory completely) such generalized other is somehow result of the interaction with one’s surroundings. There is obviously different set of moral norms in the current Iran from what is the set of moral norms in the urban Boston, Massachusetts, or Paris, or for example the Russ’ current one in the urban Israel. And yes, both of these are quite different from the set of moral norms in the eighteenth century Glasgow, Scotland. So, yes this generalized other (to paraphrase Hayek) is not perfect, because it is also the result of human action (and especially interaction, thus the name of symbolic interactionism) not of human design, it not something automatically perfect, far from it. So, yes, it can be made more egoistic (and one can argue less well functioning) under the harsh conditions of the current meritocratic universe (see “Status Anxiety” by Alain de Botton, 2004), and yes neither free market nor the liberal democracy does anything to improve it.

Roger McKinney
Sep 20 2023 at 10:22am

Good points! The US had gone down a very dark path with the fire bombings of 5 major cities that killed over 1 million women and children. Racism played a part as did characterizing Japanese as pure evil. The general who ordered those bombings admitted he would be tried for war crimes if the US lost. The evil of the napalm bombing of women and children made the lesser evil of the A bombs much easier.

The US had other options besides a full scale invasion. It could have negotiated an end to the war. And it could have dropped the A bombs on the concentration of Troops in the south.


David Shaw
Sep 19 2023 at 6:47am

Mr Munger omits the fact that the U.S. provided notice to the Japanese citizens to evacuate. They had knowledge the bombs were coming and chose to stay.


Lawrence Proulx
Sep 19 2023 at 7:13am

I think there is an unstated assumption in most of the hypothetical posers you discussed, and that is that once this awful choice has been made, no further choices will be required. But life puts questions to us every day; horrible things happen to many people every day. How many fingers do we have?  How many appeals are made to our generosity, and how many of these are genuine and how many are fraudulent? In every life there has to be an economy of generosity – and I would say the same about courage — and choosing when to spend our store of it is not a simple thing.

Richard W Fulmer
Sep 19 2023 at 1:28pm

I think that Smith is a bit ungenerous to berate the observer for – though grieving over the deaths of 100 million strangers – not losing sleep over the loss. Giving up sleep will do nothing to help the 100 million while causing harm to the observer. To raise the stakes, would a moral person give up a little finger to mourn the loss of the 100 million, though his sacrifice would help no one? A rational person would not. That same person, however, would likely give up his little finger to prevent those deaths. Self-preservation requires that we keep our grief over the deaths of strangers within rational bounds.

Gary Lynne
Sep 19 2023 at 2:34pm

Professors Roberts and Munger:

Well, first, I thoroughly enjoyed the conversation relating to how Adam Smith solved the Trolley Problem, and, how mainstream (Micro)economists using Single Interest Theory (SIT, arrogant self-interest only), well, get it wrong.

Second, Adam Smith would be a Metaeconomist, not a Microeconomist, because Metaeconomics. like Smith, sees the dual nature of Humans.   A MetaEcon (like me), well, we represent Adam Smith’s thinking  using Dual Interest Theory. Adam Smith was a  MetaEcon, in that Smith saw the need to temper the arrogance of self-love, the arrogance of self-interest only, with the moral sentiments, the ethic.  Smith did it by first seeing the jointness of arrogance & sentiments, selfishness & selflessness, within each person.  Said sentiments relating to selflessness came out of a mindful empathy-with, leading to going into sympathy-with the shared cause. It was about forming an other-interest, shared with the other, and, then, internalized within the own-self, while tempering the self-interest. It was about a bit of self-sacrifice struck in good balance in the joint self & other-interest, which gave content to the own-interest, a peace of mind own-interest.  As a result, with each person maximizing own-interest not self-interest, a Human with the ethics within, it was also an economically efficient and stable (peaceful) political economy, so, yes, people could be happy!

So, third:  The puzzles, mysteries of the trolley, the atom bomb, the matter of the reaction to calamities in distant lands, destroying fancy shoes to save a drowning child, reducing the spend on a birthday party to help poor children, and, well, even the paradox of Max U while losing a little finger, and, perhaps even dying from  while saving another — all easily explained with Dual Interest Theory (DIT) in Metaeconomics.

See the Blog stirred by the Trolley Problem Podcast for the details.  Use DIT not SIT.  See Trolley Problem, and, Sacrificing a Little Finger (metaeconomics.info)

Gary Lynne, Professor Emeritus, University of Nebraska-Lincoln

Mike C
Sep 20 2023 at 7:21am

Prof. Lynne,

Thank you for introducing Metaeconomics and SIT versus DIT here.   If Niels Bohr were still alive and could comment, he would support these ideas as “complementarity” applied to economics, very much like wave/particle duality (quantum mechanics) in physics, and Yin-Yang interdependence in philosophy.

Russ sometimes talks on EconTalk about imagining he’s traveled in time to talk with Adam Smith.   Adding Niels Bohr to the conversation, my bet is they’d spend most of the time talking about metaeconomics.

Pamela Jackel
Sep 20 2023 at 12:22am

Adam Smith must have watched the ‘Button Button’ episode of Twilight Zone.


Roger McKinney
Sep 20 2023 at 10:14am

Great episode! One quibble. Smith did not say the impartial observer came from wanting to be admired and learning from what admired people do. He wrote, “Nature has lighted up in the human heart…” He meant God, our creator put it there.

Frank C Graves
Sep 20 2023 at 11:36pm

As usual, an excellent podcast, with many extrapolations and applications of the trolley problem to contexts in which I had not recognized its parallel, e.g. abortions, pollution and externalities, the bombings in WW2 and so on.  One limitation of the brief references to abortions:  it was presented as sort of the clean opposite of the Caesarian section problem, wherein the child is sacrificed for the mother.  I see the rhetorical logic of this but it trivializes the abortion decision to describe it as only occurring that way.  I believe that in many if not most cases, there is a prevailing concern that the fetus is impaired and so may have a poor quality of life or survival risks, and carrying it may in some cases also threaten the life of the mother.  If so, it is not a selfish reverse prioritization of the mother choosing her little finger over the trolley deaths, but a larger attempt to find an ethical and overall beneficial solution to a problem with few good alternatives.  Also, it is important to recognize that saving the mother preserves her option to have other children later and perhaps to care for her existing children more effectively.   Of course, that does not reduce the logical usefulness of your analogy, but just shows its limitations.

Derek H
Sep 21 2023 at 4:46pm

From a medical and ethical standpoint, I do not see a reason abortion would ever be needed to save the life of the mother. If the pregnancy is threatening her life, the doctor could induce labor or perform an emergency c-section. Doctors could then care for the child outside the womb and if he or she dies, if would be an indirect effect of saving the mother’s life. This is in line with the principle of double effect.

As to Frank’s other point, I do not see how killing the unborn child is an alternative to he or she having a life with particular struggles. To me that seems extreme and selfish. The mother has no way to determine whether the child’s life will not be worth living based off of a doctors diagnosis. What if the doctor’s diagnosis is completely wrong. Or what if those struggles bring joy and meaning to others.


Michael C. Munger
Sep 22 2023 at 9:51am

Frank, that’s a fair point. I should have been more careful. I was summarizing FOOT’s argument, in 1967, about allowing abortions in the case of danger to the mother.

THERE the parallel is pretty close.  And at that time there was some controversy.  But since the position Foot was arguing for is now seen as settled–relatively few people would ban abortion even in the case of imminent danger to the mother–you are quite right that the general argument for abortion is very different. Thanks for listening!  Mike

Michael C. Munger
Sep 22 2023 at 9:55am

I clearly failed to communicate the reason why the Japan atom bomb example is important.

We obsess about Hiroshima and Nagasaki, where the Tokyo and Dresden fire-bombings were in many ways just as bad, and in fact no different,  in a practical sense.  That’s it, that’s the puzzle: compared to the number of civilian casualties in many other circumstances, these two events were far from the most civilian-killing incidents of the war.

The discussion was not about whether the attack was justified. But about why we focus on those attacks, above all else, as being UNjustified.

The ANSWER (and I thought we said it….) is that standard bombs seem like normal warfare, targeting military objectives, but killing civilians
as a side effect. It would be hard to prevent collateral casualties.

The atom bomb, though, targets a CITY, not a factory. Somehow, targeting a factory and killing thousands is more acceptable than targeting a city
and INTENDING to kill thousands.

The fact that there were “other alternatives” is beside the point.  And frankly tendentious. Changing the argument so you can win is a 7th-grade debate tactic.

Sep 22 2023 at 2:59pm


Thank you for making that clear and sticking to the argument. As someone who’s studied military operations and morality for decades, I would add that many are unaware of the broader history which goes well beyond WWII firebombing. For time immemorial, military operations always held civilians at risk, if only coercively. Economist Thomas Schelling brilliantly outlined this issue in _The Strategy of Conflict_ and later, in _Arms and Influence_. That is, defeating another army was always in fact an intermediate objective which ultimately put at risk the civilian population. Whether the Athenian Melian Dialogue told by Thucydides, or the Mongols, who would sack a resisting city brutally behave in such a way as to teach the next city a lesson in early surrender, or Sherman, who burned Georgia to both reduce war making industrial capacity and force the Confederacy to early surrender, each used the actuality and threat to civilians as a coercive lever. In fact, by longstanding agreement and precedent, blockades and sieges specifically targeted not just civilians but the weakest civilians and allowed encircling military commanders to forbid or even kill civilians attempting to flee (see “siege law” which is a balance between humanitarian measures and “military necessity” of isolation). The British used night area bombing specifically to obliterate civilian areas in WWII (see Arthur “Bomber” Harris’ “blue book”) which obviously had retribution for Nazi bombardment of British cities in mind as well as the stated goal of early surrender. Reports of Soviet generals having gone through Dresden back to Stalin had a significant effect on his decisions to withdraw the Red Army from occupied areas such as Iran in the wake of WWII, goaded by threats and forward deployments of US B-29 bombers in Europe which had delivered nuclear weapons in Japan. Again, the mere threat to civilians when they become vulnerable has always been a coercive political lever, and as Schelling and others brilliantly discussed in the Cold War, nuclear weapons increased that coercive lever to a point that has, arguably, limited “conventional” war (and its inherent threat to non-combatants) since their invention and demonstration. Whereas “mutual assured destruction” (MAD…) seems quite jarring to moral sensibilities, it has arguably limited non-combatant casualties over time despite tragically causing so many of them in 1945 if only considered from a long-term utilitarian perspective. War is, indeed hell and the study of it helps us understand it better.  And regrettably, it isn’t going away anytime soon…

Roger McKinney
Sep 28 2023 at 11:43am

While all true, the Dutch Republic changed the rules of war for 300 years in Europe and banned civilian attacks. Jonathan Israel makes that clear in his book on the Dutch Republic as does the great historian of war and diplomacy Herbert Butterfield. WWI was the first step away from those high principles of war and began our descent into pagan total war again in WWII


Mike C
Sep 23 2023 at 2:08pm

Mike, thank you for your additional comments on the WW2 atomic-bombing and fire-bombing decisions.

I’m just not sure whether it’s EVER a good idea to look backward in time evaluating significant historical decisions as Trolley Problem questions.  Simply reframing tough decisions into a Trolley Problem’s pose is sketchy (ie, limited alternatives, blindness to other considerations the historical decision maker was dealing with, and alternate outcomes had anything been different).   Utilitarianism creeps in, and we start hubristically thinking there’s a lesson to be drawn that max-utility is a sufficient rationale for future complex decisions.

I’d rather we leave historical decisions as they were, unrevised, with all their messy complexity, so that we and those who come after us can learn from them and hopefully do better next time.  There are important lessons in the WW2 atomic bombs in Japan, and the firebombings in Japan, Dresden, and London, but my argument is we shouldn’t use any of these as Trolley Problem scenarios.

Instead, I’d vote that Trolley Problem scenarios be limited to hypotheticals and possible future problems, to help us identify what we additionally need to learn between now and then, so we don’t end up at that future point bereft of a decision rationale other than the blunt cudgels of utilitarianism and max-U.

S Waas
Sep 24 2023 at 10:24am

Thanks for the clarification of your essential point in the a-bomb discussion: we obsess over Hiroshima far more than, say, Dresden (or indeed dozens of others) because in the later cases the atrocities could be written off as “collateral damage” whereas in the former case the atrocities, in a sense, were the point.  All this in spite of there being no real practical difference.  That is a pretty interesting point and does show the connection to the theoretical trolley problem.

But this leads me to another question (and often a key advantage of exploring abstract problems like the famous trolley are the exceptions and other deviations from the pure abstraction):  Given the practical similarity between the destruction wrought by the a-bomb and the destruction unleashed many other times by other means, why did it make a difference to the Japanese? Similarly, why did the Americans have any confidence that it would make a difference to the Japanese?  Similar displays of destructive power had failed to produce a surrender but this one suddenly did.  If quantitative measures of destruction don’t explain it, what does?

Was it simply that it eliminated even the ability to even fight back (since the ability to “win” was already apparently off the table)?  Was it somehow shocking enough (even if not more “destructive”) that it allowed a kind of mental reset by key decision makers, where the word “surrender” could actually be mentioned?  It seems to me the answer must be in the realm of psychology, and not so much military strategy or philosophy.

Patrick J Allen
Sep 26 2023 at 2:49pm

I have heard people talk about Adam Smith’s discussion of the effects of losing one’s little finger versus an earthquake that kills 100 million Chinese. But it was only when Mr. Munger talked about it and mentioned the publication date of The Theory of Moral Sentiments, i.e., 1759 (a date I knew), that I focused on the impact such a hypothetical would have had on Adam Smith’s readers. 1759 was, after all, only four years after the disastrous earthquake and tsunami that hit Lisbon on All Saints’ Day, November 1, 1755. Coming less than four years after the Lisbon earthquake, Smith’s example would have hit home much more than one realizes today when we just read it.


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TimePodcast Episode Highlights

Intro. [Recording date: August 28, 2023.]

Russ Roberts: Today is August 28th, 2023, and my guest is Michael Munger of Duke University. He hosts the podcast, The Answer Is Transaction Costs. This is Mike's 46th appearance on EconTalk. He was last here in June of 2023, talking about obedience to the unenforceable. Michael, welcome back to EconTalk.

Michael Munger: Thanks, Russ.

Russ Roberts: Our topic for today is an essay you wrote on the trolley problem and Adam Smith.

I want to add: We're probably going to get into some serious themes related to death. Parents may wish to screen this episode before sharing it with children.


Russ Roberts: Let's start with the trolley problem. Ages ago, back in 2015, we did an episode with Joshua Greene, Harvard University, that spent some time on this philosophical hypothetical. What is the trolley problem?

Michael Munger: The trolley problem raises the question of what Philippa Foot--the philosopher who first kind of raised the question in a systematic way, at least in this context--called the doctrine of double effect, or the difference between killing and allowing to die. And so, the both of those two doctrines are actually quite ancient.

And, interestingly, for economists, these tend to be--economists pretend that they're utilitarians or consequentialists. And, that is, the greatest good for the greatest number. Now, there's problems with that. We can't add up utility. But, the origin of this was--well, suppose we have some rule that allows us to treat people as equals. And, in a democracy or in liberal theory, that's not unfair. So, if we treat everyone as equals, then you can kind of add up lives or something like statistical lives saved.

So, it's common for us to use cost-benefit analysis as if we could add up utility. So, that was one of the reasons that I got interested in this to begin with.

But, it's an ancient problem, and it started probably with the Cesarean section. Now, the Cesarean section, as the name suggests, was--there is a child of Caesar that a woman is bearing, and the woman is sick, or at the time when the child is to be born, it's a breach birth and you're worried that both the mother and child are going to die. Should you remove--with all of the catastrophic cutting that that implies--should you remove the baby from the mother's womb? Knowing, in 200 AD, that that means the mother dies for certain, but you might save the baby.

And so, the difficulty is that it seems like a weak Pareto-improvement. They're both going to die, or maybe we can save the baby.

And so, the economist might say, 'It's a hard choice, but okay, let's do that.' Philippa Foot--

Russ Roberts: And, just to--you should say something about what you mean by a 'weak Pareto-improvement.'

Michael Munger: So, the Pareto criterion that economists often use as a substitute for ethical reasoning is a way to say that: Suppose that everyone is better off--two states of the world, A and B, and everyone is better off. The weak version is, no one is worse off, and at least one person is better off.

Obviously, we have choice A, which is: both the mother and the baby die. Choice B is: the mother dies, but probably, we can save the baby. B is better than A, as horrible as that sounds. Now the difference is that in the case of the mother and the baby dying, we're doing nothing to cause that. It just happens as a result of natural events.

In the case of the Cesarean section, we're actively intervening to kill one of the parties.

So, you can see why, and those familiar with the trolley problem, can see why this is a version of the trolley problem.

Russ Roberts: And, on utilitarian grounds, the fact that the baby has a longer lifespan ahead of them than the mother, would justify it in the Benthamite calculus. Bentham, being the father of utilitarianism. Carry on.

Michael Munger: Well, and so the real problem was that this was Caesar's baby and no one cared about the woman--so, it's in a patriarchal society. But, yes, the best version you can give of it is what you said.

So, what Philippa Foot--and I went down--I was preparing for this podcast and I looked up Philippa Foot and started to read about her. She's one of the most interesting people I've ever read about. I've probably spent 10 hours down the Philippa Foot rabbit hole this weekend. And, I blame you personally for that, Russ.

Russ Roberts: It's okay. I'm going to double your fee for this. I guess, tenfold increase in your fee for this episode, Mike. So, you'll end up better off.

Michael Munger: That makes it all worthwhile, thank you.

So, what Philippa Foot noted was that the problem of abortion often flips that calculus. So, particularly in the case of a difficult pregnancy that endangers the life of the mother, either both are going to die, or we're going to intervene and abort the fetus and save the life of the mother.

Now, the problem is that, in the case of a difficult pregnancy where both might die, those are happening in the natural course of events. Or, we actively intervene and kill the fetus, with the hopes that it makes the mother better off, because otherwise, both of them would've died. If the mother dies, obviously, the baby dies.

And so, the difference is--and this is where she pointed this out first in an article in 1967, which was where she first posits what she called the tram problem. We have translated that into English, so it's the trolley problem now. But, there's a tram that is--well, let me read her version of it. So:

it may be supposed that a person is the driver of a runaway tram, which he can only steer from one narrow track onto another; five men are working on one track and one man on the other; anyone on the track he enters is bound to be killed. The question is why we would say, without hesitation, that the driver should steer for the less occupied track, while most of us would be appalled at the idea that the innocent man could be framed ['would have been killed on purpose'--Munger].


The doctrine of double effect offers us a way out of the difficulty, insisting that it is one thing to steer toward someone foreseeing that you will kill him and another to aim at his death as a part of your plan. In real life, it would hardly ever be certain that the man on the narrow track would be killed. Perhaps he might find ['gains'--Munger] a foothold on the side of the tunnel and cling[s] on as the vehicle hurtled by. The driver of the tram does not then leap off and brain the man with a crowbar. [italics in original]

So, the point is that I have a choice between two alternatives which I did not create. And, in my little essay, I tried to identify the importance of this difference.

So, if you look at surveys of what are called the trolley problem, if I am on a runaway trolley, no brakes, no way to stop, and I'm heading towards a track that has one person who cannot escape and will be killed if I do nothing, or I can pull a switch and divert onto another track that will kill five people, but I can save the life of the one. Should I save the life of the one by acting? No one says that I should do that. No one says that I should divert and kill the five to save the one.

Now, what looks like almost the same thing, but is quite different: Suppose the tram is hurtling down a track and there's five people on that track, or I can divert. If I divert, it will go down a track that will kill one person. Do I do that? Now, from a sort of economic consequentialist perspective, there's no difference. But, there is a difference between my intention and my acting. So, the doctrine of double effect would say that any action that I take has two effects and I have to compare their consequences.

And Philippa Foot introduces this comparison, that she later expands on in a number of other, what she called, moral dilemmas. And, the moral dilemma is that we feel like there's a difference in terms of moral agency. And, what moral agency means is that if I allow someone to die, it is very different from me actively killing them.


Russ Roberts: So, first of all, I think it's fascinating. I've never read the original article that you're reading from. The fact that she notes the possibility of the one person leaping aside, I think is one of the reasons that some of these hypotheticals are foolish--not so much as a conversation topic; I don't find them foolish at all, I find them very interesting. But, when surveys are done and certain proportions of people answer one way or the other, people make big, grand conclusions about the human brain or about morality. And, I think it's very hard for most human beings answering a survey to ignore the real-world aspects of the hypothetical.

So, in all the hypotheticals in all the survey versions, you're told: The person will die with certainty. Or: They can't get out of the way. Right? And, there's a third version, of course, which I think we've mentioned on the program at some point, where you have a choice. You're on a footbridge, and you have a chance to push a person over the footbridge to stop the train that's about to kill five people. And, I think those survey results are very problematic, because I don't think you can ignore the possibility that other things will happen. You could assume that, but I find that a little bit troubling. And--

Michael Munger: Let me say--

Russ Roberts: Go ahead.

Michael Munger: Please, go ahead.

Russ Roberts: And, I think I've mentioned the program before, when I posed this problem to my children, one of my kids--who at that point was, like, 10 years old--said, 'Well, I wouldn't push the heavy person over the footbridge railing and save the others.' I said, 'Why not?' He said, 'Because he might fight with me, and then I wouldn't be able to push him over, and I might get pushed over.' And, I thought, 'Well, that's interesting. You're supposed to ignore that.' Then I realized: But most people probably don't. The idea of grappling with another human being--forget the whole issue here of causing the thing to happen versus allowing it to happen--the whole idea that the outcome is uncertain is just assumed away. And, I think that makes a lot of the survey results on these problems problematic.

I find the same issue with Peter Singer's example of ruining your shoes to save the drowning child. And therefore--because you should ruin your shoes to save a drowning child--you should send the value of your shoes to Africa for malaria bed nets, where malaria is prevalent, to save lives. As if it's a certainty, that you can save lives by spending money. Which, tragically, is not true.

And--anyway, my only point is that I want to emphasize that in these hypotheticals, I think it's more interesting to talk about them than to judge the survey results.

Michael Munger: Right? This brings us to three things. One is to Adam Smith--which was the reason that I wrote my essay, and probably the connection to EconTalk, in the sense that I think it's interesting. And, I think if you read Adam Smith, the hypothetical about sacrificing one's little finger or losing one's little finger, compared to 100 million people in China dying in an earthquake, that's a really interesting part of The Theory of Moral Sentiments.

But, let me suggest this. This afternoon--classes are starting today at Duke--I teach the first class in the PPE gateway--Philosophy, Politics, and Economics. And, I'm going to ask them how many have seen the movie, Oppenheimer. And probably a fair number of them will have seen the movie, Oppenheimer. And, that was not hypothetical. The United States faced two choices. It could try to develop an atomic weapon that it could use to end the war in the Pacific with Japan, or it could pursue a plan that they had come up with, called Operation Downfall.

And, Operation Downfall was a systematic military ground attack of the Japanese mainland. And interestingly, after the war, the Japanese defense plan--and it was called Operation Ketsu-Go. Operation Ketsu-Go was the fortification of much of Japan in a way that Okinawa had been fortified. And, the plan that--this is the Japanese estimate of their casualties--at least 2 million soldiers and as many as 50 million civilians would die if Operation KetsuGo were triggered. And, again, this is the Japanese view. It's possible that it was somewhat larger, somewhat smaller, but the Japanese themselves had decided that that was what they were going to do.

The United States had lost 25,000 dead on Okinawa. Nearly 100,000 had been wounded or put out of action. The Japanese had lost 200,000 on Okinawa, and that was not the Japanese mainland.

So, the United States faced the choice: Are we going to develop and drop atomic weapons on cities--defenseless cities--and intentionally kill women and children? Or are we going to pursue military objectives? And, as a side-consequence--as an unavoidable side consequence--that, because the enemy is resisting, is going to result in 10 times as many casualties?

Now, it's the trolley problem. Because, it is your intention to kill women and children, in the case of the atomic weapon. You are actively saying, 'We are going to drop a bomb onto an unsuspecting defenseless city, and the result is going to be catastrophic deaths. And, that is literally our intention. That's what we're going for.' Or, we can take another course of action that is within the tradition of military ethics.

And so, there is a--I think the usual hypothetical about should the United States have dropped the atomic bomb, is easy, because there are far fewer casualties in the case of the atomic bomb, even in Japan. Certainly, there's far fewer casualties to the United States. The estimates for the U.S. casualties were up to a million--up to a million U.S. soldiers might die in the taking of the Japanese mainland. The Japanese strategy was to--and they may have been right--that the United States would give up. It just wasn't worth it. At some point, after two or three more years, if they continued to resist, the United States would just give up.

And so, the question is: Was the United States morally justified in using atomic weapons when it involves killing? Not 'allowing to die.' When it allows killing, not allowing to die.

And so, the reason for that extended sort of claim--and let me raise one more--is--and whoever is playing the EconTalk drinking game may have to chug at this point, because you've not mentioned driverless cars or autonomous cars in quite a while. It used to be a main part of the show.

But, if you are programming an autonomous car and there's a school bus ahead of you that you're going to hit, or you can go up onto the sidewalk and hit a woman and a baby carriage, your choices are just to let the momentum of the car take you into the bus, or go up on the sidewalk and kill the woman and the baby carriage. That's not a hypothetical. That's literally things that we have to face.

So, the reason to do these hypotheticals is to train the minds of the young leaders in philosophy, politics, and economics, because they are, Russ, the elite. They are the best. So, the PPE [Philosophy, Politics, and Economics] students are clearly the smartest of all students, because that is the major everyone should pursue. We have to train them on toy problems, so that they could deal with the non-hypotheticals that they will have to deal with as tomorrow's leaders.


Russ Roberts: In the TV series, The Good Place,--a show I enjoyed immensely--one of the characters, Chidi, C-H-I-D-I, Chidi is a philosopher in the show. And he is forced--through a snap of the fingers, he finds himself in a trolley barreling down on some workers. There's a track: he can divert to kill one worker. And, he's got about 10 seconds to make the decision. And it's highly entertaining and quite interesting.

Michael Munger: No spoiler alerts, but it was highly entertaining.

Russ Roberts: Yeah, I will not tell you what happens. I'm not sure--

Michael Munger: But, we will link to it. It's important.

Russ Roberts: We may link to a clip from that episode, and you can say whether it's your cup of tea, if you haven't seen it. Later on in this series--this I will not mention--there is an actual answer to the trolley problem, which I found quite provocative and interesting.

But, in real life, you often have to make these decisions in real time. You don't have the luxury of sitting around in a seminar room. And, certainly, Harry Truman didn't have that luxury when deciding to drop the atomic bomb. It was not, evidently--he claims, I think--it was not a hard moral decision for him.

Michael Munger: He cared about Americans. He's the American President.

Russ Roberts: And, I would just mention that a quick Google search suggests that about 200,000 people died in the bombings of Hiroshima and Nagasaki. Of course, many more had health problems related to it. But, 100,000 people approximately died in a single night in the firebombing at Tokyo--

Michael Munger: Tokyo--

Russ Roberts: which was a horrific tragedy.

Michael Munger: And, intentional. It was an intentional firebombing.

Russ Roberts: Yep.

Michael Munger: They waited until the weather was right to have enough wind to create the firestorm.

Russ Roberts: And--again, I'm not sure that was a serious moral dilemma for the people who pulled the trigger on that decision. But, I'm only remarking on that because--and of course, neither of those casualty numbers were known in advance. Nobody knew exactly how many people would die in either them. But, for some reason, the nuclear attacks are treated differently from the firebombing.

And it's an example of why, many times in these hypotheticals, there are strange, intangible things that the answer hinges on for many people.

In the case of the trolley problem, as you point out, for many people, it's the causing versus allowing to happen. People feel very differently about that. Why that is: longer conversation, another time, probably.

But, in the case of the atomic bomb versus firebombing, for some reason, the atomic bomb is put in its own unique box. And, you could argue it's because it allows an unimaginable destruction in its aftermath in the future, or simply because it has a technological aspect to it that is different from bombs of which human beings had been using for some time.

But, I thought it was unintentional--unintentionally ironic on your part that you mentioned that the atomic bomb was like a different kind of warfare. Not so much. The standard of what was acceptable after the bombing of London--which I think was an accident by Hitler--the bombing of civilian targets, opened up, changed the norms. Or at least excused a different set of norms. And, we got the firebombing of Tokyo.

There's also of course the firebombing of Dresden. I'm looking that up now--

Michael Munger: 25,000--

Russ Roberts: The firebombing--


Michael Munger: 25,000.

Russ Roberts: Only, quote, "only 25,000". But horrific, destructive: one night of horror, terror and destruction for civilians. You can argue whether they were innocent or not; there's a whole bunch of moral lines you could draw. Certainly, I would argue the children were innocent, but you could argue more widely depending on your perspective.


Russ Roberts: But, let's move on to Adam Smith, unless you want to respond to anything I said. We are in the 300th anniversary of the birth of Smith, so it's kind of nice that we're talking about him. You quickly summarized it, but talk about it again, and let's talk about the dilemma that Smith poses.

Michael Munger: Well, it was actually Adam Smith that was the point of my essay. Because I claimed that Adam Smith had, 'solved'--and perhaps we should put that in quotation marks--Adam Smith suggests a way that our intuition about what later has come to be called the trolley problem might work.

So, on page 136 of the Liberty Fund edition of The Theory of Moral Sentiments--and I should say, I first encountered this in your marvelous six-part discussion with Dan Klein a long time ago, now. I think it was 2009, that I really recommend to everyone this discussion of the brilliance of the way that Smith kind of turns the tables. Because usually, the story is--and I think it is worth reading, just to make sure we have the context. So, again, this is on page 136 in Section Three, Chapter Three.

Let us suppose that the great empire of China, with all its myriads of inhabitants, was suddenly swallowed up by an earthquake, and let us consider how a man of humanity in Europe, who had no sort of connexion with that part of the world, would be affected upon receiving intelligence of this dreadful calamity.

So, this is pretty much a standard person of humanity, not someone who is inured to human suffering. Someone who actually cares about other people. He would, I imagine, first of all:

express very strongly his sorrow for the misfortune of that unhappy people, he would make many melancholy reflections upon the precariousness of human life, and the vanity of all the labours of man, which could thus be annihilated in a moment. He would too, perhaps, if he was a man of speculation, enter into many reasonings concerning the effects which this disaster might produce upon the commerce of Europe, and the trade and business of the world in general. And when all this fine philosophy was over, when all these humane sentiments had been once fairly expressed, he would pursue his business or his pleasure, take his repose or his diversion, with the same ease and tranquillity, as if no such accident had happened. The most frivolous disaster which could befal himself would occasion a more real disturbance. If he was to lose his little finger to-morrow, he would not sleep to-night; but, provided he never saw them, he will snore with the most profound security over the ruin of a hundred millions of his brethren, and the destruction of that immense multitude seems plainly an object less interesting to him, than this paltry misfortune of his own.

Now, usually people stop there and say, 'Adam Smith says we're so selfish.' There's several interesting things about that. He calls the Chinese "our brethren"--which, in 1759 in England, racism is pretty rampant and unquestioned. It's not clear that that is--Smith was an egalitarian. There's a thoroughgoing egalitarian.

Russ Roberts: Yep.

Michael Munger: But, he's actually using the fact that they are our brethren and we still don't really care, as part of his point. And if you stop there, it makes you think, 'Boy, people are just rotten, selfish pieces of work.'

Russ Roberts: Yeah, and it's a beautiful hypothetical, because I think most of us would concede that it's true. As unpleasant and unappealing it is to believe that human beings are like this, most of us read news all the time about catastrophic things happening to people far away. Where in his day, the news would be the equivalent of watching a supernova, an event that would have occurred long ago in the past. By the time you got news of that earthquake in China, it would have happened, presumably, a week at least beforehand. Today, we watch it live, and we still sleep like babies at night. A strange expression, actually, 'sleeping like a baby.' It means to sleep well. Most babies don't sleep so well; but whatever.

So, I think most of us--and I challenge all of you listening--to ask yourself, how many catastrophic things we just read about--many of us watched or read about the tragedy in Hawaii, a horrible, horrible loss of life of, for many people, their own country-, fellow country-members. And yet, they slept fine.

And yet, I think Smith is correct, that if we knew we were going to have surgery tomorrow, even minor surgery--so-called minor surgery, which, of course, is surgery that happens to someone else: there is no such thing as minor surgery for ourselves--we'd sleep badly. We'd be in trouble.

Michael Munger: This is disfiguring. You're going to lose your little finger. They're going to cut off part of your hand.

Russ Roberts: And it's painful, and it's uncertain about the real full consequences--

Michael Munger: It's awful, it's awful--

Russ Roberts: coming back to the ability to talk about hypotheticals. But, let's say, try to pretend that it's only your little finger. It's still your little finger, and it's hard--

Michael Munger: And the power is that it's your little finger; that he's probably right.

Russ Roberts: Yeah.

Michael Munger: I would be more upset about the prospective loss of my little finger than I would the deaths of many people that I don't know, that I have no personal connection with.

Russ Roberts: At least, in the psychological impact on our day-to-day equanimity--

Michael Munger: Yeah--

Russ Roberts: I mean, that's what Smith is literally saying.

Michael Munger: He's talking about the way that we live our lives. So, I would think--and I would go for a walk, in fact. I might even cry a little. I would be upset: 'That's just so awful that this has happened.' And, then, I'd have dinner.


Russ Roberts: Yeah. So, carry on, though. That is very important: that that is not the end of Smith's discussion, but it is often where it is ended when other people write about it. But, he goes on.

Michael Munger: Well, and it is a fair place to end, in terms of an outline. So, what I read, full stop, that's an important point. We have now set one important standard.

Then, he continues--and he's not a big guy on paragraphs, so it's still the same paragraph:

To prevent, therefore, this paltry misfortune to himself, would a man of humanity be willing to sacrifice the lives of a hundred millions of his brethren, provided he had never seen them? Human nature startles with horror at the thought, and the world, in its greatest depravity and corruption, never produced such a villain as could be capable of entertaining it.

Now, I think that's not right. But, there are sociopaths who might very well consider that. Or, like, the Joker on Batman--

Russ Roberts: Yeah--

Michael Munger: But, that's why he's so horrible, is that there's just wanton--or in No Country for Old Men, the sort of chaos figure. He's so horrible precisely because he would consider it.

Russ Roberts: Meaning, a person who would sacrifice the 100 million foreigners to save one's own little finger--which didn't come out in that reading, by the way. I'm not sure why. You said "just to sacrifice," you didn't say "to save the little finger." Did you skip ahead, or--

Michael Munger: No, I continued.

Russ Roberts: Okay, carry on.

Michael Munger: But, let me say it again, because it wasn't clear:

To prevent, therefore, this paltry misfortune to himself

That's: Save the little finger:

would a man of humanity be willing to sacrifice the lives of a hundred millions of his brethren, provided he had never seen them? Human nature startles with horror at the thought, and the world, in its greatest depravity and corruption, never produced such a villain as could be capable of entertaining it. But what makes this difference? When our passive feelings are almost always so sordid and so selfish, how comes it that our active principles should often be so generous and so noble? When we are always so much more deeply affected by whatever concerns ourselves, than by whatever concerns other men; what is it which prompts the generous, upon all occasions, and the mean upon many, to sacrifice their own interests to the greater interests of others?

Now, there's more. There's more to be said. And, he says a couple more important things.

Russ Roberts: Yeah, hang on. I want you to read that part, too. But, just to summarize here, what he's saying is that: you've told me already you care about your little finger more than you do about the death of 100 million, because it keeps you up at night, and the other thing doesn't. And yet, when you have a chance to act and save your little finger--which you care more about according to your emotional response--you won't do it.

And that, to me, is the--if he'd been writing the book in 2023, he might have started, instead of being on 136 [i.e., 'page 136'--Econlib Ed.] --I know there's some preamble in the Liberty Fund edition, but it's not the opening. It would have been a great opening few pages. Instead, it opens much more diffidently and in a more challenging way to follow. But, that is essentially the setup for The Theory of Moral Sentiments.

Cover page: The Theory of Moral Sentiments, by Adam Smith. Source: Online Library of Liberty.

I just want to say, by the way, Mike, that I was in Scotland a week and a half ago. And, I was in Edinburgh for the first time, and I was able to go to Adam Smith's house, Panmure House, where he spent the last 12 years of his life living with his mom. And, in the front of that, as you enter that building, there is a copy of The Theory of Moral Sentiments open there. And, it comes with a subtitle I had not seen. It is: The Theory of Moral Sentiments, OR, An Essay Towards an Analysis of the Principles by which Men Naturally Judge, Concerning the Conduct and Character, First of Their Neighbors, and Afterwards, of Themselves.

Now, I mention that only because it's a very useful bit of verbiage to help you understand what The Theory of Moral Sentiments is really about, given that we don't use the phrase 'moral sentiments' in the way today that Smith did.

But, that's what it's about: it's about judging the character and actions of your neighbors, and of yourself.

And so, what he's saying is that: 'Okay, this is who we are. We don't care much about others. We care more about ourselves. We are self-interested. But we are not selfish.' We do not kill others--most of us--to save a small amount of ourself.

And that's a startling and bold claim, which I also believe is true.

Michael Munger: I have an embarrassing admission. And, that is, because I am so much more of a fanboy of you than you are of yourself--which is as should be. Dan Klein read the subtitle that you just gave in your six-part EconTalk about it. Which of course, you wouldn't know. This is like somebody goes up to somebody from the Eagles, and, 'How did you write these lyrics?' 'I have no idea. I don't remember that.' But, the fanboy has memorized them, and expects you to have memorized all this. You have seen it before. At least, you've heard it.

Russ Roberts: Oh.

Michael Munger: But, that was 2009.

Russ Roberts: 2009. But, this confirms Adam Mastroianni's claim, that the brain is not connected to the ears, episode of a couple of weeks ago.

Michael Munger: You said you had not read it before. Actually, technically, you have saved yourself. You would've heard it.

Russ Roberts: But, I'd heard it.

Michael Munger: Yes.

Russ Roberts: It's embarrassing. Okay.

Michael Munger: Because Dan, unsurprisingly, thought it was important: That--that subtitle is important--to understanding it.

So, before I continue to give Smith's explanation: In my essay, I say: Adam Smith, if he had had the opportunity, would have posed the question in the language of the trolley problem.

So, there's a trolley hurtling down a track, and it happens that I am stuck beside the track and my little finger is stuck in the track. And if the trolley continues on its current course, it will cut off my finger. Or, I have a switch, and I can pull the switch and it will divert the trolley onto a path where it will kill 100 million. Now, that's actually a really difficult problem, since I also control the switch, but that's Smith's formulation.

So, we could take one step back and have a sort of an A and B version. The A version is: I, a disinterested, impartial spectator, I have control of the switch, and I see it's heading towards you, Russ Roberts, and it's going to cut off your little finger. Or I can divert it, and it will kill 100 million people. I hope you don't mind, but you're going to lose your finger.

Now, it's interesting to ask whether having control of the switch yourself, would you actually have the self-control, the self-governance? Because that's what Smith-the-stoic is advocating for: is that we would actually have the self-governance that we would not press the switch. And of course, he's right. If I did panic and push the switch, and 100 million were killed to save my little finger, people would be horrified. And rightly so. That was an awful thing to do. So, I hope that I would have the self-control to have it continue along that path.


Russ Roberts: Before I get to Smith's answer, I just want to add one thing, because you're talking about self-sacrifice and you being in charge of the switch, versus me being in charge of the switch. I always find it interesting when we read about the moral failures of others. People will often say, 'Well, I would've done something different,' or, 'I wouldn't have.' And, I'm always thinking, 'Mmmmm--I don't think that's true, probably,' but it's nice to say.

So, for example, the brave Germans who took Jews into their houses, or Poles who took Jews into their houses during the Holocaust--or, let's take those who didn't. Those who gave away the hiding places of Jews to curry favor with the Nazis, people would say, 'Well, I would never do that.' Well, wait until you're in that situation. You're worried about your own family. And, I don't judge people who--I hope I wouldn't have done that if I had been a Pole. I hope that, as a Pole, I would have harbored Jews and risked my own life. But, if I'm risking my family's life, it starts to get complicated.

But my point is that a person would--I think many people harbored Jews. It didn't take a family of five to make it a morally worthwhile thing to do. Nobody said, 'Well, let's see. I'm risking my own life, but I could save five, so I'll do that.' They didn't do that. They weren't utilitarian. They said, 'This is the right thing to do.' There's a small number who did it. I think it's incredibly courageous. Those are people who gave up more than their little finger. They gave up the peace of mind that they could have had by doing nothing, and risked their own lives--often risked their family's lives--to save people who weren't them.

And so, when you talk about you'd hope that I would give up my little finger to save 100 million: Yeah, I hope so, too. But, maybe not everybody would've done it. And certainly, if talking about risking my little finger to save your leg, or your arm, or hand, it can start to get even more complicated.

Michael Munger: So, the reason I like the putting Smith's claim in the trolley problem formulation is that it does allow you to change that out a little bit. So, suppose instead of your little finger, it was you--

Russ Roberts: Yeah--

Michael Munger: Or your family. Now, I still think Smith's analysis go through, but gosh, that's an awful kind of situation.

And that's closer to the sheltering-the-Jews problem: is that I'm not actually going to lose my little finger if this goes wrong. I'm going to lose a lot. But, only in probability. But there's a pretty good chance.

So that, I wrote down, 'Peace of mind,' and I think we should come back to that. Let's put a stake in the question of peace of mind, because it's actually peace of mind that has to do with Smith's answer.

To review, we've talked about a bunch of stuff. Smith has posed a puzzle. It's not a hypothetical. It's a puzzle.

So, if you accept his premise--and I think I do--the premise is that I'd be more upset about the prospect of losing my little finger than I am upset, in terms of actual, material day-to-day life, by hearing of the distant death of 100 million people that I do not know. But, I would sacrifice my little finger to save those 100 million people.

So, that seems like a preference reversal. That seems like something behavioral economists would say, 'That's a paradox.' So, one of the reasons why some people say Smith was the sort of poor behavioral economist was he came up with these preference reversals and then came up with explanations for them.


Russ Roberts: Before you go further, you actually, I think unintentionally, changed Smith a little bit. Which normally, I would say is no big deal, but in this case, it kind of is a big deal. You gave the example of that I would sacrifice my little finger to save the 100 million. He actually, I think, talks about: Would I kill the 100 million to save my little finger? In a way, it's the same thing; but in these kinds of goofy philosophical hypotheticals, they're different, slightly.

Michael Munger: Yep. Because what he says is, 'Is he willing to sacrifice the lives of 100 million to prevent this paltry misfortune to himself?' So, you are right, that is the formulation.

So, his answer is--and we finished with, "But what makes this difference?"

... When we are always so much more deeply affected by whatever concerns ourselves, than by whatever concerns other men; what is it which prompts the generous, upon all occasions, and the mean upon many, to sacrifice their own interests to the greater interests of others?

So, a generous person, by definition, is willing to sacrifice their own interests. But, the mean, upon many occasions, that is people who are by no means generous, are still willing to sacrifice their own interests to the greater interests of others.

And, this is just beautiful:

It is not the soft power of humanity, it is not that feeble spark of benevolence which Nature has lighted up in the human heart, that is thus capable of counteracting the strongest impulses of self-love.

So, it's not a contest between self-love and benevolence that is my primary caring about other people:

It is a stronger power, a more forcible motive, which exerts itself upon such occasions. It is reason, principle, conscience, the inhabitant of the breast, the man within, the great judge and arbiter of our conduct. It is he who, whenever we are about to act so as to affect the happiness of others, calls to us, with a voice capable of astonishing the most presumptuous of our passions, that we are but one of the multitude, in no respect better than any other in it; and that when we prefer ourselves so shamefully and so blindly to others, we become the proper objects of resentment, abhorrence, and execration. It is from him only that we learn--

And that "him" is the impartial spectator:

It is from him only that we learn the real littleness of ourselves, and of whatever relates to ourselves, and the natural misrepresentations of self-love can be corrected only by the eye of this impartial spectator. It is he who shows us the propriety of generosity and the deformity of injustice; the propriety of resigning the greatest interests of our own, for the yet greater interests of others, and the deformity of doing the smallest injury to another, in order to obtain the greatest benefit to ourselves. It is not the love of our neighbour, it is not the love of mankind, which upon many occasions prompts us to the practice of those divine virtues. It is a stronger love, a more powerful affection, which generally takes place upon such occasions; the love of what is honourable and noble, of the grandeur, and dignity, and superiority of our own characters.

I have goosebumps from reading that.


Russ Roberts: Yeah, it's a very subtle formulation. It's a little bit contradictory. Obviously--I think we've talked about it before in the program--and for the drinking game, people waiting for the quote: Smith says, "Man naturally desires, not only to be loved, but to be lovely". That is, to not only--

Michael Munger: You were pretending not to know that. Come on.

Russ Roberts: No, I was struggling there. It's been a long day here in Jerusalem. I did blank out for a minute. I thought, 'Did I get that right?' And, I think I got it right. If not, we'll find 80 or 90 other episodes where we can patch in it right.

Michael Munger: That may be the best moment in the history of EconTalk.

Russ Roberts: So, by that, Smith meant praise--lovely--he said we desire to be loved, we desire to earn the respect and admiration and praise of others, and we want to earn it honestly. We want to be not just loved, but lovely. We want to be praise-worthy.

And yet, that's not exactly what he says in that passage, right? The passage that--'we desire to be loved and lovely,' says: we often behave well because we want other people to respect us, and we want to be worthy of that respect. And this passage you just read is really, in a way, an elaboration--even though I think it precedes the quote that I'm quoting--it's really elaborating on what it means to be lovely. That your self-image, that you use the idea of an impartial spectator--who is not you, and not one of the Chinese--you use this impartial spectator as your standard of conduct. That is, someone who is disinterested, impartial.

So which is it? Is it utilitarian on my part? Wrong use, wrong word. Is it utility-driven on my part, that: I'm going to behave well because I want other people to like me? Or, is it the fact that I have a standard for myself, a behavior, a nobleness, a grandeur, a conscience?

And they're not exactly the same thing. And, what Smith is saying--subtle--is that they both work together to keep me from doing the most selfish things that come naturally to me. To be self-interested is who I am. And yet, I sometimes--and often--rise above that, because I want to earn the respect of others, and I want to earn respect, self-respect. And, I think that's a very deep and thoughtful formulation.

Michael Munger: I want to defend Smith here as being coherent, though difficult. And, you actually already foreshadowed the answer by saying 'peace of mind.' It's going to take me a minute to get back to that.

What Smith is imagining is that we care very much about being approved of by others. And, over time, we develop the habit of acting in a way that should elicit approval of others, because we become aware of manners and the system of propriety that has been developed by the great author of nature to ensure the things we approve of are good, and the things we disapprove are bad.

And so, we actually stop looking to others for approval, though we still care about it. What we mainly look for is our well-formed and carefully habituated impartial spectator.

And, a person of propriety has an impartial spectator that is actually better than the momentary reaction of the people around us. I might do something that doesn't immediately get approval, but I've thought about this and it's the right thing to do. And I'm, in some cases, able to console myself with that, though it still hurts to be disapproved of.

And so, the reason why, actually, I was pursuing peace of mind if I was someone who sheltered Jews or someone who was oppressed, was I would've felt even worse if I had not done that, because it would not have been in accordance with what I know to be the right thing to do. I would've been sacrificing the lives of others to save my own little finger, or the equivalent of that.

And so, it's actually for peace of mind. He is literally arguing for peace of mind here.

And in the next paragraph, I think he explains why. And, as far as I can tell, Philippa Foot never cited this, but it is exactly her contrast between allowing and causing harm. So, let me read it. Just continuing on, on, on page 137:

When the happiness or misery of others depends in any respect upon our conduct, we dare not, as self-love might suggest to us, prefer the interest of one to that of many. The man within immediately calls to us, that we value ourselves too much and other people too little, and that, by doing so, we render ourselves the proper object of the contempt and indignation of our brethren. Neither is this sentiment confined to men of extraordinary magnanimity and virtue.

So, again, it's not just the generous, but even those who are mean.

It is deeply impressed upon every tolerably good soldier, who feels that he would become the scorn of his companions, if he could be supposed capable of shrinking from danger....

One individual must never prefer himself so much even to any other individual, as to hurt or injure that other, in order to benefit himself, though the benefit to the one should be much greater than the hurt or injury to the other.

So, that's literally the trolley problem. Even if it would benefit one much more than it would the other, if I act to impose that harm and that benefit, then I am behaving badly just on its face. It's different--it's one thing to allow. So, if it's hurtling towards the one person, of course, I will not switch it. But, if it's hurtling towards the five, I feel really bad about switching it towards the one, because it is my act that is causing the harm.

Russ Roberts: Yeah. And, obviously, in a certain perspective there, it's easy to call them equivalent.

Michael Munger: They are in one sense. In the utilitarian sense, they are.

Russ Roberts: Shoving someone into a deep body of water, like San Francisco Bay near Alcatraz, seems very different from failing to rescue them. Again, we'll assume that you can swim so well that you can bring the person back. And, yet, we feel differently about them.


Russ Roberts: But, what this all reminds me of, and you can ignore this; and if you want to make a broader point, please do. But, again, as much as I love Adam Smith, and as much as I've learned from him, a criticism you could make at this point is that, as an armchair theorist, he's hampered by the circle he inhabits. And, when your best friend is David Hume, and you hang out with people like Hume and others in Edinburgh and elsewhere, you may have a slightly distorted view of human nature.

If Smith were literally right in that passage--if that passage was accurate--we would not worry about externalities in economics. We would just say, 'Well, they're not important, because people internalize them because of the man in the breast.' They would never pollute or litter, or do things that harmed other people, because they would be aware that they were putting themselves forward.

And of course, later on, Smith talks about our ability to self-deceive: that, in the heat of the moment, the passion of the moment, we often fool ourselves and lie. But in the calm that follows, we'll reflect on it and realize we have been less than lovely.

But, the impression you get from passages like that is that many of the social problems that bedevil modern society should go away without any type of policy intervention--because we're all decent chaps.

And, as economists, we tend to be skeptical of that answer.

And worse, maybe in teaching our students that, they misunderstand what the definition of rationality is--which is a whole other can of worms we're not going to open right now.

But, my point is, is that: that's a powerful and eloquent defense of our natural inclination to do the right thing. But we know--and again, I think Smith knew, and he writes about it--that we often don't do the right thing. So, he did recognize it's complicated.

Michael Munger: Well, partly this is exhortation: that he wants people to recognize that a society that operates according to these principles is going to be a better society. Now, he's not an anarchist. There are all sorts of reasons why it takes more than that. But, if we act in accordance with our natural principles, rather than being beaten down and becoming selfish, the society will be better off.

Well, he goes on one little bit more. Let me just cite two more things. We're coming to the end of our time. And, this is Smith, page 138, in Theory of Moral Sentiments:

When the happiness or misery of others, indeed, in no respect depends upon our conduct, when our interests are altogether separated and detached from theirs, so that there is neither connexion nor competition between them [Munger leaves out "between them"--Econlib Ed.], we do not always think it so necessary to restrain, either our natural and, perhaps, improper anxiety about our own affairs, or our natural and, perhaps, equally improper [Munger reads that as "equally important"--Econlib Ed.] indifference about those of other men.

So, this is about moral agency. And that's what the trolley problem is about, also.

So, there's really two issues here. One, I think is Smith's perhaps excessive optimism about this being an actual solution. And, I read that as exhortation. It's fair enough to say it would be better if society operated that way.

The other is his extremely elegant solution of the problem of why it is that we think it's different to divert and kill one, or do nothing and kill one. That is, Philippa Foot's later distinction between allowing and killing.

So, the other thing that I thought was great was: Smith raises a question of how much it is that we know. And so, the fact that I don't really know the 100 million people--I don't have any sort of direct connection--it's difficult for me to establish some kind of empathy with them. He said:

Two different sets of philosophers have attempted to teach us this hardest of all the lessons of morality. [para III.I.50]

And that hardest of all lessons is that we only care about ourselves, and yet, morality says that we should care about others. And we do if we have any active role in it. So:

One set have laboured [Munger read as "One have laboured"--Econlib Ed.] to increase our sensibility to the interests of others; another, to diminish that to our own.

So, one is: Care less about yourself. And one is: You should care more about others.

... The first are those whining and melancholy moralists, who are perpetually reproaching us with our happiness, while so many of our brethren are in misery, who regard as impious the natural joy of prosperity, which does not think of the many wretches that are at every instant labouring under all sorts of calamities, in the languor of poverty, in the agony of disease, in the horrors of death, under the insults and oppression of their enemies. [para III.I.51]

So, at this point, you have to give Peter Singer a little bit of credit. The effective altruism movement is saying: 'We actually can do something, and we can get information that Adam Smith was not able to get.' In Adam Smith's time, as you said, it's like a supernova. This happened months ago. Well, this is happening now, in Africa, in South America, or maybe an earthquake in China. And, as a result, it is possible for us to act on the impulse, to sacrifice some small amount from ourselves and try to help someone else.

And so, I bet that there was a philosophy softball team at Princeton called The Whining and Melancholy Moralists, because I think it's either a great band name, or an intramural softball team name. But, the whining and melancholy moralists are constantly trying to get us to think about other people. And we don't, because failing to act is not actually that important. But it has become relatively more important.

And, I should note that the next episode of The Answer Is Transaction Costs, my podcast, takes up this question. Because in a way, it's a question of transaction costs. Do I know two things? First, do I know that the suffering is real? And second, do I know that if I make some kind of contribution, it will actually be received and used by the people that I care about?

So, I think that it is interesting that Smith sort of foresees this, but also raises it as a kind of transaction cost question, which in principle, might be changed if our ability to know things is modified.

Russ Roberts: Well, I disagree with that--with the role of information. I think the transaction cost is crucial. But, I think a key part of Singer's claim--I think Singer's claim, which I disagree with, Singer's claim is that you care more about your child than a strange child. Therefore, you throw a birthday party for your child, and you fail to save a foreign child from malaria, the death by malaria. And, Singer exhorts us to rise above that natural inclination and that self-interest, and care as much about the foreign child as your own child.

I disagree with that calculus. That's a subject for another time. So, in that sense, I think the information is not the central piece of the challenge of the drowning child. That's not a good example--not the drowning child: the child who is at risk of malaria death.


Russ Roberts: I want to close with a different question. Do you think capitalism and the commercial society encourages us to put ourselves before others? Many people believe that. Very common argument. Smith would not have agreed with that, I don't think. But, you can give me Smith's view, and you can give me Mike Munger's view. Do you believe that we are coarsened by the competitive nature of capitalism and tend to frequently ask, 'What's in it for me?'

Smith is explicitly saying, 'What's in it for me,' is the first question that comes to mind. He then argues, I think, the second question is--it should come to mind and often does--is, 'What's in it for others?' And therefore, I should not always do what's in it for me. What do you think about those questions?

Michael Munger: Smith is relying on a pre-existing system of propriety at the social level, and the cultivation of self-governance at the individual level. In that context, I think he rightly thinks capitalism does not coarsen or make us more selfish.

But remember, Smith, in Theory of Moral Sentiments, talks about four sources of sentiments. The first is my impulse to act to help others. The second is the reaction of other people to my attempts to help. Are they grateful? Do they show gratitude? Is it something they actually want?

And the third is: does this comport with my sense of propriety, culturally? Are these--this satisfy the norms of the way that people should act?

It is only the fourth, our appreciation of the well-contrived machine of commercial society, that is a mechanism for elaborating division of labor.

So, in Smith's system, capitalism does not coarsen us, because we have those four sources of moral sentiments. And, the first three are still operating in most of our personal relationships. But it is crucial that the well-contrived machine of division of labor be able to operate at sufficient scale, because it's limited by the extent of the market.

So, our wealth and prosperity can coexist with the sense of social relations we have from the first three sources of moral sentiments. That balance, I think, has not been well defended by classical liberals. Classical liberals have often come pretty close to saying, 'Well, markets are really all that we need, and then each of us will go off and pursue our own sense of happiness. We can all be atomistic, and it'll work out fine.' That's not true.

And so, if you just say that we don't need any social relations, we don't need to be embedded in a social context: all we need is markets to provide wealth and from that, we'll have these little gewgaws and our pockets will be full of tweezer-holders, and all the operose machines that Smith said, 'That's stupid. That's not the source of happiness,'--then yes, we can be coarsened by capitalism.

Russ Roberts: I would just add that Smith thought that capitalism--commercial society, buying and selling--forces to often put ourselves in the shoes of our neighbors, figure out what they need, what would make them happy. And that, actually, not just--doesn't coarsen us, but actually makes us more sympathetic to what our brethren need. But, I want to close.

Michael Munger: Virgil Storr has written about that. So, a number of people have written about capitalism is creating a moral space in which people can cultivate those other sources of moral sentiments. That's certainly right.

Russ Roberts: But, I do want to agree with you, that the culture that surrounds us is always up for grabs, and it can exist in the socialist and in capitalist societies.

My answer to my own question about whether capitalism creates self-ish people, is: Compared to what? The Soviet Union was not a particularly empathetic place, when only certain people could get apartments and so on. It wasn't a love fest of kumbaya.

And certainly, a coarse culture can exist with capitalism, or with socialism. And, without the culture you're talking about, that Smith advocated for, I think it struggles--all systems struggle--to lead to human flourishing.


Russ Roberts: I want to close and just ask you to summarize--you said it beautifully, but you said it fairly quickly. And, for listeners who have been overwhelmed by the different scenarios we've talked about, I want you to restate, if you would, how Smith, quote, "solves the puzzle." Not of what to do, or what the right thing to do is in the trolley problem, but why we feel differently about certain scenarios within the trolley problem; why there seems to be inconsistency between how we feel, say, and how we act. Which is the problem that he poses. Not exactly the trolley problem, but you've applied it there.

So, try to summarize that again for listeners who have, in the middle of their commute or walking their dog are thinking, 'You know, that's really interesting, but what was the bottom line again?' So, take a shot at it.

Michael Munger: So, Smith poses a dilemma, a puzzle: Why is it that we care more about our little finger than 100 million people in China, or some far away country that we don't know those people, of them dying or coming to grief? And, we care more about a little finger in the sense that we are more upset by the prospect of--in our everyday life, that is more of an upset. There's no way to say how much we care. But, in terms of how much I am upset, I care more about my little finger.

On the other hand, if I have a chance to act on that impulse, I'd not only reverse it, but there's just no question that I would not bear the sacrifice of 100 million lives to save my little finger--to accept your correction. I mean, that is the way that Smith actually states it. And then he gives a solution to that; and that is: He thinks that there is a difference between accepting the consequences of things that are happening in the world and our own obligations of moral agency to act.

And, I think that solution not only is right--that, given a chance to act, I should, and in fact, I would satisfy the dictates of the impartial spectator, to saying you are a monster if you would say, 'No, no, I care more about my little finger than the 100 million people,' if I actually had the chance to make a difference, if I could act in the world in a way that would have an effect on that.

What I think is interesting is that that answer, if you pick it up and take it over to the trolley problem, also solves the trolley problem. So, Smith is not actually addressing the trolley problem, because it had not been stated. It was not stated until 1967 by Philippa Foot.

But, Philippa Foot actually proposes, almost, Smith's solution. She uses different words. The words that she uses are that there's a difference between allowing a harm and causing a harm. There's a difference between allowing a death and killing.

And, that's exactly the point that Smith was making. I would not act to kill, or even to harm someone else, in order to save myself some harm, if it is actually my action that makes the difference. And, that's the essence of the trolley problem: is when we're in a position to act ourselves, we're much more reluctant to accept an outcome, which if it's the default, we're happy to allow.

Russ Roberts: Beautifully said. My guest today has been Mike Munger. Mike, thanks for being part of EconTalk.

Michael Munger: Thanks, Russ. Thanks so much.

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