Responding to socioeconomic inequality and the decline of political participation, theorists of “audience democracy” emphasize citizens’ spectatorship of political leaders but neglect how citizens experience being watched themselves. I turn to Adam Smith's arguments about the effects of inequality on spectatorship, highlighting his criticisms of the public's disdain for people living in poverty. By comparing Smith's arguments about misperceptions of people living in poverty to his discussions of an innocent man accused of a crime, I show how mistaken spectators demoralize even morally judicious individuals. I also expand on an example of unjust censure that Smith suggests but does not discuss in detail: the social shame directed at a survivor of rape. I conclude by using Smith's insights to reflect on the social and interpersonal dynamics of surveillance that render contemporary welfare programs degrading for many participants and help transform socioeconomic inequality into political inequality.