From Chapter 2, Smith expounds on how mankind makes use of one another, and suggests that they do so only when each party offers something in return.
"In almost every other race of animals each individual, when it is grown up to maturity, is entirely independent, and in its natural state has occasion for the assistance of no other living creature. But man has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only. He will be more likely to prevail if he can interest their self-love in his favour, and show them that it is for their own advantage to do for him what he requires of them. Whoever offers to another a bargain of any kind, proposes to do this. Give me that which I want, and you shall have this which you want, is the meaning of every such offer; and it is in this manner that we obtain from one another the far greater part of those good offices which we stand in need of. It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest."
Ending with this
"We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages. Nobody but a beggar chooses to depend chiefly upon the benevolence of his fellow-citizens."
A socialist can argue that socialism satisfies the above self-interest. That the bargaining is not done away with in socialism but merely driven through 'society'. I say, without Smiths eloquence, that socialism, in removing each persons individual ability to bargain his personal productive ability (however restrained by reality), it leaves nothing but compromise to piss every one off - and burgeoning 'black markets'.
Next up is a comparison between animal and man (Smith seems to like doing this) showing how division of labor is the source of mankinds strength.
"Each animal is still obliged to support and defend itself, separately and independently, and derives no sort of advantage from that variety of talents with which nature has distinguished its fellows. Among men, on the contrary, the most dissimilar geniuses are of use to one another; the different produces of their respective talents, by the general disposition to truck, barter, and exchange, being brought, as it were, into a common stock, where every man may purchase whatever part of the produce of other men's talents he has occasion for. "
So people make use of one anothers skills (division of labor) to mutual advantage and do so when they can trade with eachother to mutual enrichment.
Moving onto chapter 3 and argument that would be well used by supporters of small communes as a way to reduce the 'horrors' of specialisation.
"When the market is very small, no person can have any encouragement to dedicate himself entirely to one employment, for want of the power to exchange all that surplus part of the produce of his own labour, which is over and above his own consumption, for such parts of the produce of other men's labour as he has occasion for"
So when people are unspecialised certain skills are inhibited from developing either to any great degree, or from developing at all - which impacts on the usefulness people find within one another and thus the degree to which they would seek to trade. Perhaps this is the root to socialism? Doesn't sound very appealing though - sounds like Robisonson Crusoe self reliance isolationism to me.
Incidently when Smith talks of men doing simple work and becoming stupid - he doesnt speak about the mechanics, office PC using clerks, welders, carpenters, electricians, plumbers, painter & decoraters and all those other non-college educated jobs people do all around us in the West, but more the repetetive work of digging, log chopping, yarn weaving as done by the majority of workers in his day.
Fine though Smith's writing is - almost the entire book is well formed opinion and logical deduction rather than actual facts. Inevitable with 'social sciences' but in both these posts one should be cautious about taking 'because Smith said it' as being evidence of fact. Same goes for other writers. The reader is responsible for evaluating what is read.