Diverging perspectives on Colonisation

An Analysis through the Lens of Smith and Mill

UQ PPE Society

Published in

Statecraft Magazine

15 min readAug 9, 2024

by Joshua Pooranakaran

A massive congratulations to Joshua Pooranakaran on your outstanding achievement as the winner of the First-Year Writing Competition! Your essay showcased exceptional critical thinking and comparative analysis, making it a true pleasure to read. Thank you for your impressive work, and we look forward to enjoying more of your writing in the future.

All the best,

The Statecraft team

Introduction

In recent years, increased rhetoric highlighting the benefits of colonisation (Gilley 2017, 10), has inevitably been met with a surge in reactionary anti-colonial sentiment. Such anti-colonialists see its imperialistic and patriarchal underpinning as the foundational reason for many of today’s social issues (Juan and Jan, 168). In analysing colonisation, we turn to two of the most prominent classical liberal thinkers of modern times; Adam Smith and John Stuart Mill. While both thinkers are from a similar liberal tradition and have many shared values like peace, market-based prosperity, and limited government (Meskill 2013, 91), the one realm that they differ starkly in is colonisation. While Smith argues that colonisation is a net negative to indigenous populations, given its facilitation of monopoly formation and propagation of destruction (Williams 2014, 287), Mill argues that colonisation was a net-benefit to indigenous populations as it brought economic growth and modern institutions, thereby improving their quality of life (Habibi 2016, 522). As such, it’s clear that Smith and Mill, while cut from the same cloth of liberal enlightenment, still possessed an individualistic flair that grants us greater nuance in understanding impactful social issues like colonisation. In its analysis, this paper will first outline relevant ideas that Smith and Mill shared. Subsequently, it will compare and contrast their arguments on colonisation, before concluding with an analysis of why these thinkers diverged so starkly on colonisation.

Both Smith (Smith 2007, 19) and Mill (Mill 2010, 186) were avid advocates of free markets and trade, believing that economic agents acting competitively and in their self-interest would see societal good arising as a by-product. They believed in limited government (Smith 2007, 348), with interference justified only when necessary e.g. for addressing market failure, social inequalities, defence and justice (Mill 2010, 201). Interestingly, Mill was relatively more supportive of government intervention, believing the government had a role in realms like education (Mill 2010, 3) as it would allow for societal utility maximisation (Mill 2022, 12). In addition, Smith (Smith 2007, 94) and Mill (Mill 2010, 5) were staunch advocates of liberty and freedom, valuing their contribution to progress and prosperity while deterring the oppressive force of government tyranny. However, differing from Smith, Mill emphasised that concepts of liberty and individual autonomy were intended solely for developed societies where persuasive discourse and not violence guided progress (Mill 2010, 44). On an ethical front, while both were supporters of justice, Smith’s ethical framework focused more on empathy (Mill 2002, 4) and the role of selfishness (Smith 2007, 368) in facilitating tolerance, mutual dependence, and economic justice by reducing economic inequality via the free market. Mill, on the other hand, analysed the ethical nature of activities through the lens of utilitarianism with a focus on ensuring the greatest happiness for the greatest number (Mill 2022, 8). Indeed, as classical liberal thinkers, both Smith and Mill held many similar beliefs — though even in these realms there were slight differences as highlighted above. It is this extensive overlap in beliefs that makes a comparison between them especially useful, as it highlights that their similarities were not simply the result of blind agreement but reasoned and nuanced justification, making their differing conclusions on colonisation, as outlined below, all the more intriguing.

Smith’s Argument Against Colonialisation

Smith, in contrast to Mill, opposed colonisation for its tendency to facilitate monopoly formation (Smith 2007, 527). With monopolies using their inherent market power to hike prices, the indigenous population’s consumer surplus is reallocated to producers (Smith 2007, 402), leaving the indigenous population with hampered real income and a slowed improvement in their standard of living. Smith outlined the risk of monopoly formation explicitly when he emphasised that the main beneficiaries of colonisation were not the British or indigenous people, but British merchants (Smith 2007, 410). With merchants acting as suppliers of colonial imports and England implementing import restrictions on foreign entities, limited competition made British merchants monopolies where their immense market power from controlling supply allowed them to dictate high prices (Smith 2007, 367). As a result, Smith argued that colonisation saw to the drainage of indigenous resources and consumer surplus through hiked prices to the benefit of suppliers, leaving the indigenous population worse off because their gain in material standard of living from commercial exchange was less than their loss in resources and potential consumer surplus (Smith 2007, 445). Therefore, Smith was an opponent of colonisation due to its propensity to form monopolies to the economic detriment of the indigenous.

Smith justified his opposition to colonisation through a quantitative cost-benefit analysis

Moreover, as the father of economics, Smith justified his opposition to colonisation through a quantitative cost-benefit analysis; unlike Mill, who positioned his arguments heavily on qualitative socio-political impact. Indeed, with colonisation costing the British people more than it benefited them, the British choosing to act as a colonial power was in opposition to their self-interest (Smith 2007, 470). This is substantiated by Smith when he explicitly calculates that the taxpayer cost of financing the military defence and administrative maintenance of a monopoly, far exceeded the fraction of profits from exclusive trade that made it back to the people once the merchants took their cut (Smith 2007, 453). As such, with the magnitude of costs to the British people far outweighing the benefits, engaging in colonisation was to their financial detriment, with the benefit primarily going to the elite businessmen (Smith 2007, 470). Therefore, Smith highlighted his opposition to colonisation through an economic cost-benefit analysis, which interestingly is in contrast with the approach taken by Mill which focused on socio-political consequences.

Finally, while both Smith and Mill believed in the prosperity and civilisation-spreading benefit of colonisation, Smith still viewed colonisation as a net-harmful phenomenon that led to destruction, slavery, and death of indigenous populations (Smith 2007, 458). Indeed, the promise of a new world only heightened the natural desire within humans for domination, resulting in reduced moral inhibitions about the sanctity of life as they pursued wealth extraction and domineering (Smith 2007, 393). Smith makes this explicitly clear in Wealth of Nations, where he highlights that the “cruel destruction” of the “harmless natives” was one of the first acts of injustice in the new world (Smith 2007, 451). In addition, while acknowledging the potential for colonisation to accelerate a nation’s development, he remained a staunch opponent due to the significant human cost of colonial rule (Smith 2007, 510), which he viewed as incompatible with his values of peace, liberty and consent-given governance, given colonisation’s nature as a foreign imposition (Smith 2007, 450). Such a decision to reject colonisation, despite its potential for civilisation advancement, was further advanced by his brand of moral philosophy as outlined in his work “The Theory of Moral Sentiments”, where he emphasised the importance of sympathy and empathy (Smith 2002, 2) in maintaining social order and ensuring the fair self-evaluation of our actions’ moral worth (Smith 2002, 29). Here, by considering the destructive onslaught from the perspective of indigenous populations, Smith’s aversion to colonisation’s pain-inducing nature becomes comprehensible, despite its perceived civilisation-spreading nature. Therefore, despite recognising the potential for societal development like Mill, Smith opposed colonisation as he had moral qualms against the destructive nature of colonisation and its contradiction with his values of liberty and governance by consent.

Mill’s Argument For Colonisation

Contrasting Smith’s rejection of colonisation on economic grounds, Mill cites colonisation’s potential for facilitating economic growth as a fundamental reason for his support (Mill 1988, 297). With European colonials prioritising trade and production in their colonial advancements, capitalism thrived in the colonies. This is substantiated by the shift from centuries-long stagnation to the exponential economic growth experienced by colonies after colonisation brought trade, industry and educational improvement to their shores (Grier 2007, 20). Notably, Mill’s support for colonisation is based on a premise shared with Smith that prosperity is the appropriate metric for determining society-type desirability (Birchall 2022, 495). While seemingly simplistic, such a premise is credible as increased prosperity provides one with the economic means to afford a better quality of life — a goal in line with Mill’s principle of utilitarianism (Mill 2022, 8). Moreover, given that humans band together as societies to increase safety, stability, and quality of life, it becomes clear that a society which maximises these is desirable as it effectively fulfils the function of society (López-Ruiz et al. 2021, 3). Given that capitalist nations are the most prosperous and uniquely possess the highest quality of life, it would seem that prosperity is an appropriate metric for societal evaluation (Joshanloo, Jovanovic and Taylor 2019, 2). Therefore, despite agreeing on the potential for economic growth from colonisation, Mill and Smith’s disagreement on whom the benefits would accrue to, led to their diverging stance on colonisation.

while both thinkers believed colonisation benefits indigenous populations by promoting civilisation, unlike Smith, Mill does not acknowledge the subsequent issues that arise like genocide

Furthermore, while both thinkers believed colonisation benefits indigenous populations by promoting civilisation, unlike Smith, Mill does not acknowledge the subsequent issues that arise like genocide. Instead, Mill focuses on the potential for European powers to bring liberal values and institutions of Western civilisation to the indigenous population, granting them centuries of progress in mere decades (Mill 1988, 235). For instance, Mill points to the introduction of justice administration, representative democracy, and increased movement of capital, labour, and information, as key institutions that could transform indigenous societies into something more similar in advancement to England, which he saw as superior in development (Mill 2020, 165). Remarkably, he based this conclusion on the stadial theory of history which was propagated by the Scottish Enlightenment (of which Smith was a member), which suggests settled societies are more advanced than nomadic societies because they experience a greater sense of civilisation (Birchall 2022, 495), prosperity and peace — contributing factors to utility maximisation (Mill 2022, 67). Such hierarchical rank-ordering of societies, while agreed upon by both Smith and Mill, still saw a divergence in views on colonisation, because Smith’s cost-benefit analysis accounted for the costs of colonisation far better than Mill, who focused primarily on its benefits (Coyne and Hall 2013, 366). Therefore, given Mill’s greater focus on benefits than Smith, Mill is a proponent of colonisation as he believes its facilitation of societal change from nomadic to settler lifestyle is a boon to the indigenous population.

However, Mill’s later writings shifted his stance against colonisation, highlighting the need for a balanced approach. Indeed, as the years progressed, Mill became increasingly concerned with the humanitarian costs that had similarly concerned Smith (Doyle 2015, 290). This was particularly the case as reports of settler violence against indigenous populations in India, the West Indies, and New Zealand increased in prominence (Smits 2008, 4). As a result, through his moral philosophy of consequentialist utilitarianism, Mill increasingly saw colonisation as undermining its intended civilising mission and feared that colonial abuses of power neutralised its moral justification (Smits 2008, 9). In his final years, he lost faith in the project, recognising the prevalence of rampant violence rendering colonisation an immoral mission unjustifiable by utilitarianism, only further undermined by its infringement on the values of liberty, independence, and right to self-governance that Mill held dear (Cynamon 2024, 3). Therefore Mill, a proponent of idealised colonisation, became increasingly critical of its practical implementation as he realised its noble intentions had been hijacked by violent exploiters (Doyle 2015, 292).

Understanding their Differing Stance on Colonisation:

Given Smith’s desire for prosperity and his economic preference for free trade over mercantilism, Smith’s opposition to mercantilism’s protectionist policies sees him opposing colonisation

Smith and Mill’s Different Approaches to Realising Universal Peace

Despite sharing a common underpinning value of universal peace, Smith and Mill have significantly different stances on colonisation (Coyne and Hall 2013, 362). Smith emphasises the importance of peaceful interaction as an underlying value in facilitating free markets and prosperity (Walraevens 2020, 215). Given Smith’s desire for prosperity and his economic preference for free trade over mercantilism, Smith’s opposition to mercantilism’s protectionist policies sees him opposing colonisation, as its use of dominance and the threat of violence to enforce monopolies runs counter to his desire for peaceful economic exchanges (Smith 2007, 366). As such, from an underlying belief in peace as a facilitator of prosperity, Smith criticises colonisation for its protectionist policies which, by creating a sense of dominance and animosity among economic agents, thereby limited prosperity generation — the key criterion for realising his desired progress in society. On the other hand, Mill believed that civilisation and settlement lead to more peaceful societies, as the stability provided by civilisation reduces fear of the Hobbesian state of nature (Tunick 2006, 603). With a belief in progress through the four stages of the stadial theory of history, Mill advocated for colonisation to facilitate the transformation of the colonised from nomadic to settled societies, facilitating the birth of more peaceful societies (Tunick 2006, 603). As such, Mill saw the need for colonisation as a peace-spreading force if his desire for universal peace was to be realised. Given such a contrast between Smith and Mill, we realise that counterintuitively, their opposing views on colonisation stem from their differing views on how to achieve their shared value of universal peace (Coyne and Hall 2013, 362). Therefore, it becomes clear that despite having different stances on colonisation, Smith and Mill are far more similar in underlying beliefs than one would think.

Differing Contextual Factors and Lived Experiences

Secondly, from a contextual approach, Smith differed from Mill in his views on colonisation because he was the product of a different time (Williams 2023, 40). Uniquely, Smith wrote during the Industrial Revolution, where the world witnessed economic upheaval (Hill and Clary 1990, 50). The sudden availability of more cost-effective production of steam-powered ships and advances in transportation infrastructure like railroads made it cheaper and faster to transport goods and people across continents, contributing to increased global interconnectedness (Hill and Clary 1990, 51). Recognising the importance of international trade for continued economic development, Smith argued against colonial mercantile systems because their trade patterns undermine efficient resource allocation and competition (Myint 1977, 232). Furthermore, Smith’s primary work Wealth of Nations was published in 1776, a pivotal year in history, coinciding with the American Revolutionary War. To Smith, the war symbolised backlash from the colonised against coloniser rule, leaving Smith concerned about the potential inevitability of a colony uprising and subsequent state of war where peace and freedom are reduced (Schumacher 2020, 21). In such a state, the sudden increase in the cost of colony maintenance that came from needing to finance a war would worsen the cost-benefit split, reinforcing his criticism of the dominating and violent mercantilist policies of his time (Smith 2007, 433). Moreover, the influence of such arguments on Smith was likely exacerbated by his greater sensitivity to economic reasoning due to his professorial background in economics, which saw him deeply involved in understanding economic phenomena (Graafland and Wells 2020, 33). Therefore, Smith’s anti-colonial stance, grounded in opposition to the economically inefficient mercantile system, was uniquely influenced by his experience as an economic scholar and real-life experience of the Industrial and American Revolution, making him relatively more sensitive than Mill to economic reasoning (Williams 2023, 40).

Mill’s support for colonisation was coloured by his utilitarian-taught upbringing and confirmation bias from being a longtime employee of a colonising company

In contrast, Mill’s support for colonisation as a peace and civilisation-spreading endeavour can be attributed to his early education emphasising utilitarianism and his long-time employment with the East India Trading Company (Zastoupil 1988, 32). Influenced from a young age by his father and Jeremy Bentham’s philosophy, Mill was raised in a school of thought that would see colonisation as bringing prosperity, progress, and thus utility to the greatest number (Harris 1964, 190). He substantiated such preconceived beliefs through reference to his first-hand account of technological and educational development in India (Tunick 2006, 586). As a result, Mill viewed the harm to indigenous populations from colonial systems as being offset by economic and civilising improvements, thereby having an overall net-increasing effect on utility (Harris 1964, 202). Notably, Mill’s affiliation with the East India Trading Company may have tempered his criticism of colonisation as he grappled with the complexities of governance and administration in colonial territories, fallaciously justifying injustices as unfortunate collaterals to the overall noble business of bringing civilisation and peace to India (Zastoupil 1988, 33). Furthermore, Mill lived during the height of the British Empire, a period of extensive colonial expansion and propaganda which likely influenced his support for colonisation as a means of spreading “civilisation” and “prosperity” to less-developed regions (Lester and Vanderbyl 2020, 186). Therefore, Mill’s support for colonisation was coloured by his utilitarian-taught upbringing and confirmation bias from being a longtime employee of a colonising company.

Conclusion

In a final analysis, while Smith and Mill are similar in their views on free markets, limited governance, and universal peace (Meskill 2013, 91), they differed significantly on colonisation due to the difference of opinion on the pathway to universal peace and different lived experiences. Smith viewed colonisation as a detriment to peace due to its reinforcement of the violent mercantile system (Williams 2014, 287), while Mill saw it as a way to spread civilisation and thus peace to backward societies (Habibi 2016, 522). Similarly, Smith’s economic background (Graafland and Wells 2020, 33), and his lived experience during the Industrial and American Revolution, made him more sensitive to the economically unjustifiable effects of colonisation (Williams 2023, 40). On the other hand, Mill’s utilitarian upbringing (Harris 1964, 190) and long-term employment with a colonising company made him susceptible to the cognitive fallacy of myside bias (Zastoupil 1988, 32), where his susceptibility to a contrarian view was limited given his long-term loyalty and employment in colonisation. Thus, comparing and contrasting Mill and Smith shows that, while they agree on much (with certain nuances), a fundamental divergence on colonisation emphasises their individualism. As such, there is no single thinker who accurately represents the entirety of liberal thought, as many secondary interpretations suggest. Instead, a study of their primary works, regardless of perceived similarities, is crucial for a comprehensive understanding of historical thought and therefore, a strong foundation for tackling the world’s wicked problems.

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