Nuts and bolts
As for the general conclusion to which the arguments I present here tend, it’s a fairly safe bet that Adam Smith’s two most quoted remarks are these:
He [every individual] generally, indeed, neither intends to promote the publick interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it.
All systems either of preference or restraint, therefore, being thus completely taken away, the obvious and simple system of natural liberty establishes itself of its own accord.
If it is a characteristic of religion to invoke awe at the magical properties with which some supposed immanent order is allegedly imbued, then these statements - with their exhortation to seek grace through surrender to the hand of a higher law - qualify as religious. All will be well, and all will be well - if only. It turns out on analysis that much libertarian theory is little more than this; an unfounded quasi-religious statement of faith. It is, as I should like to put it, a market romance. (More sceptical readers will have suspected as much all along, of course. )
However - and naturally enough - libertarianism claims to be more. It claims to be a body of truth founded upon an appeal to reason and firm evidence. Specifically, many libertarians hold (1) that the market exchange is a paradigmatic exemplar of freedom, as it is of want-satisfaction also. They hold (2) that a pure free market (or ‘capitalist’) economy is ‘simply’, or ‘nothing more than’ the sum or aggregate of all the market exchanges which actually take place between individuals within a given set. (I shall call this ‘the reducibility thesis’. ) For such libertarians both the freedom thesis and the invisible hand thesis (so named after Smith’s remark quoted above) are closely logically related to, if not directly entailed by (1) and (2) taken together.