Mill refers to Rousseau's upsetting the consensus of the Enlightenment that the modern spirit of commerce makes people more "civilized" with his theory of "natural goodness" of men. A good review of recent scholarship on Rousseau is Gentle Savages and Fierce Citizens against Civilization by Mendham, who describes the consensus as follows:
"According to this theory, the increase of commerce - meaning both economic exchange and broader social interaction - would make societies more doux (gentle, mild, calm, peaceable, soft, and/or sweet: see Hirschman  1997, 56-63; 1985, 43). It was advocated by Jean-Francois Melon, Montesquieu, Voltaire, David Hume, and indeed a strong majority of the leading intellectuals of the time."
What was paradoxical about Rousseau's response to the doux commerce (sweet commerce) is that he counterposited to it not one but at least two (arguably three) alternative ideals, incompatible with each other. On the one hand, he extols "sensitivity, gentleness, sentimentality, and compassion" of naturally good "gentle savages", on the other, "manliness, courage, hardness, and patriotism" of "fierce citizens". The two are embodied in the metaphors of "tranquil household" and "Spartan city", respectively (the third option, of a "moral individual", is less pronounced). Accordingly, Rousseau's criticisms of his contemporary society seemed to paradoxically blame it for two opposite sets of vices, at the same time. He almost behaves like a modern pundit throwing everything and the kitchen sink at the "system" without much concern for coherence:
"On one hand, moderns are said to be luxurious, lazy, weak, and soft, in opposition to images of primitive hardiness, vigor, ferocity, and rustic virtue. On the other hand, modern life is said to be cruel, frenzied, competitive, and harsh, in opposition to primitive gentleness, idleness, abundance, and spontaneity. Is Rousseau, then, simply an imaginative ideologue, forwarding wildly opposed and oscillating characterizations of these eras, merely in revolt against the spirit of his age?"
Two influential modern attempts to unravel Rousseau's paradoxes go back to Strauss's On the Intention of Rousseau are Men and Citizens by Shklar. On the Straussian interpretation, Rousseau presents a "divided humanity" with the "political solution" and the "individualistic solution" to remedy its woes. However, the former is only intended for public consumption. The only virtuous life that is, in practice, available to moderns, and endorsed by Rousseau, is the one of romantic "solitary dreamer".
On the other hand, on Shklarian view, both the "tranquil household" and the "Spartan city" are equally valid and defended by Rousseau as meeting "the inner psychic needs of men for inner unity and social simplicity". That in contrast to the unholy union of half natural and half social arrangements that foster neither men nor citizens.
Todorov, Mendham and others argue for a reconciliation of the two views, where the opposite ideals are seen not as alternatives but as stages in the development of humans. Indeed, was one of the first theoreticians of perfectibilite, perfectibility of human species, and expressed ambivalence about modern civilization that "perfects... human reason, while deteriorating the species":
"More generally, by interpreting Rousseau's apparently conflicting remarks carefully according to sociopolitical context, we can discern many consistencies underlying his inconsistencies. In analyzing the social types which emerge, we might also find that Rousseau shows a surprising degree of impartiality in openly depicting various nonmodern weaknesses, while at least observationally and implicitly acknowledging certain modern strengths."