FREDERIC BASTIAT, Defender of Sound Economics · 2006. 9. 20. · Cercle Bastiat of France for providing the Bastiat portrait used in this booklet. We also want to thank the Foundation

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FRÉDÉRIC BASTIAT,

Defender of Sound Economics


This publication is offered by The Montreal Econo-mic Institute and International Policy Network.




The Montreal Economic Institute would like to thank theCercle Bastiat of France for providing the Bastiat portraitused in this booklet. We also want to thank the Foundation

for Economic Education for their kind permission toreprint their translation of Bastiat’s works.



FRÉDÉRIC BASTIAT

Defender of Sound Economics


Introduction byMs. Linda Whetstone

ChairmanInternational Policy Network




Montreal Economic Institute

6418 Saint-Hubert St.Montréal (Quebec)H2S 2M2 Canada

Phone: (514) 273-0969Fax: (514) 273-0967

Email: [email protected] Site: www.iedm.org

Production supervision: Varia Counsel

Design, lay-out and typesetting: Guy Verville

© Montreal Economic Institute

ISBN 2-922687-13-9

Legal Deposit: 3rd Quarter 2003

Bibliothèque nationale du QuébecNational Library of Canada

Printed in Canada



Introduction

By Ms. Linda WhetstoneChairmanInternational Policy Network

Everyday we are confronted by economic fallacies in thenewspapers or on the radio or television. A news head-line tells us that the reconstruction following some

natural disaster will boost spending and thus lead toeconomic growth; an analyst complains about the loss of jobsand economic opportunities due to technological improve-ment; a lobby group asks for protection of the local economyagainst “unfair” competition from more efficient producersabroad.

Over 150 years ago, a French journalist and politician,Frédéric Bastiat, had explained in a deliciously ironic way whythese declarations don’t make sense from an economicperspective. His short and often humorous fables showed, in adidactic manner, that what is seen and appears obvious in theshort term is not necessarily as important as what develops ina more complex and hidden manner in the longer term.

Although he died at the young age of 49, Bastiat wrotedozens of these pieces and thoroughly demolished theeconomic fallacies that were in vogue in his country at thattime. Some of these, like his Petition from the candle makers,are worth more than the hundreds of treatises that have beenwritten on trade policies as an efficient and clear demonstra-tion of the absurdity of protectionism. Bastiat’s brilliant use ofsatire enabled him to turn even the most complex of economicissues into a tale to which the average person could relate.

Fallacies have to be demolished anew in every generation.Not just because of an abstract intellectual duty to fight whatis not true, but because the lives of millions of people areimpacted by policies that are founded on these illogical expla-nations of how the world works. Men, women and children in

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Third World countries today cannot have access to the basicnecessities of life, let alone fulfill their more ambitiousdreams, because the economic decisions of their governmentsare driven by economic fallacies.

This is the reason why we at the International PolicyNetwork created the Frederic Bastiat Prize for Journalism.The Prize is open to all writers, anywhere in the world. Itrecognizes and rewards those whose published workspromote the institutions of a free society in an outstandingmanner, in the tradition of Bastiat. In 2003, the Prize wasawarded at a ceremony in New York City in the presence ofacclaimed dignitaries and academic personalities fromaround the world. The winners received $10,000 and anengraved glass candlestick (a reference to Bastiat’s famousessay).

International Policy Network (IPN) is a non-profit,non-governmental, educational organization, whose missionis to «share ideas that free people.» We believe that peoplearound the world would be better off if they were governednot by overbearing autocrats or unaccountable bureaucrats,but by the institutions of the free society — property rights,the rule of law, free markets and free speech. Where regula-tions are necessary, we believe they should be based on soundscience and sound economics.

IPN achieves its mission by promoting discussion of therole of these institutions in the context of key issues of interna-tional importance. We sponsor and co-ordinate conferences;commission, edit and syndicate publications; develop websites and discussions lists; commission, edit and placeopinion pieces and co-ordinate attendance of expert commen-tators at key international conferences.

This superb booklet contains five of Bastiat’s most famousand relevant pieces and was distributed to all attendees of theNew York ceremony on October 22nd courtesy of theMontreal Economic Institute (MEI). MEI is a Quebec-basedresearch and educational institute which endeavours topromote a sound economic approach to the study of publicpolicy issues. Today, Frédéric Bastiat is better known in theEnglish-speaking world than in France, the country where helived. But MEI is trying to revive interest in his work in the

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Frédéric Bastiat, Defender of Sound Economics




French-speaking world, and published an earlier version ofthis booklet in the original French.

The more people know about Bastiat, in any language, themore likely it is that sound economic policies will be adopted,and that peace and prosperity will prevail around the world.

Introduction







What Is Seen andWhat Is Not Seen

1

In the economic sphere an act, a habit, an institution, a lawproduces not only one effect, but a series of effects. Of theseeffects, the first alone is immediate; it appears simulta-

neously with its cause; it is seen. The other effects emergeonly subsequently; they are not seen; we are fortunate if weforesee them.

There is only one difference between a bad economist anda good one: the bad economist confines himself to the visibleeffect; the good economist takes into account both the effectthat can be seen and those effects that must be foreseen.

Yet this difference is tremendous; for it almost alwayshappens that when the immediate consequence is favorable,the later consequences are disastrous, and vice versa. Whenceit follows that the bad economist pursues a small present goodthat will be followed by a great evil to come, while the goodeconomist pursues a great good to come, at the risk of a smallpresent evil.

The same thing, of course, is true of health and morals.Often, the sweeter the first fruit of a habit, the more bitter areits later fruits: for example, debauchery, sloth, prodigality.When a man is impressed by the effect that is seen and has notyet learned to discern the effects that are not seen, heindulges in deplorable habits, not only through natural incli-nation, but deliberately.

This explains man’s necessarily painful evolution. Igno-rance surrounds him at his cradle; therefore, he regulates hisacts according to their first consequences, the only ones that,

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1. The Introduction as well as sections I, III, V, VIII and IX of this essay,which comprises twelve, are included here.



in his infancy, he can see. It is only after a long time that helearns to take account of the others. Two very differentmasters teach him this lesson: experience and foresight. Expe-rience teaches efficaciously but brutally. It instructs us in allthe effects of an act by making us feel them, and we cannot failto learn eventually, from having been burned ourselves, thatfire burns. I should prefer, in so far as possible, to replace thisrude teacher with one more gentle: foresight. For that reason Ishall investigate the consequences of several economicphenomena, contrasting those that are seen with those thatare not seen.

I. The Broken Window

Have you ever been witness to the fury of that solidcitizen, James Goodfellow,2 when his incorrigible son hashappened to break a pane of glass? If you have been present atthis spectacle, certainly you must also have observed that theonlookers, even if there are as many as thirty of them, seemwith one accord to offer the unfortunate owner the selfsameconsolation: “It’s an ill wind that blows nobody some good.Such accidents keep industry going. Everybody has to make aliving. What would become of the glaziers if no one ever brokea window?”

Now, this formula of condolence contains a whole theorythat it is a good idea for us to expose, flagrante delicto, in thisvery simple case, since it is exactly the same as that which,unfortunately, underlies most of our economic institutions.

Suppose that it will cost six francs to repair the damage. Ifyou mean that the accident gives six francs’ worth of encour-agement to the aforesaid industry, I agree. I do not contest itin any way; your reasoning is correct. The glazier will come,do his job, receive six francs, congratulate himself, and blessin his heart the careless child. That is what is seen.

But if, by way of deduction, you conclude, as happens onlytoo often, that it is good to break windows, that it helps tocirculate money, that it results in encouraging industry in

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2. [In French, Jacques Bonhomme, used like “John Bull” in English torepresent the practical, responsible, unassuming average man.—Translator.]



general, I am obliged to cry out: That will never do! Yourtheory stops at what is seen. It does not take account of whatis not seen.

It is not seen that, since our citizen has spent six francs forone thing, he will not be able to spend them for another. It isnot seen that if he had not had a windowpane to replace, hewould have replaced, for example, his worn-out shoes oradded another book to his library. In brief, he would have puthis six francs to some use or other for which he will not nowhave them.

Let us next consider industry in general. The windowhaving been broken, the glass industry gets six francs’ worthof encouragement; that is what is seen.

If the window had not been broken, the shoe industry (orsome other) would have received six francs’ worth of encour-agement; that is what is not seen.

And if we were to take into consideration what is notseen, because it is a negative factor, as well as what is seen,because it is a positive factor, we should understand that thereis no benefit to industry in general or to national employ-ment as a whole, whether windows are broken or not broken.

Now let us consider James Goodfellow.On the first hypothesis, that of the broken window, he

spends six francs and has, neither more nor less than before,the enjoyment of one window.

On the second, that in which the accident did not happen,he would have spent six francs for new shoes and would havehad the enjoyment of a pair of shoes as well as of a window.

Now, if James Goodfellow is part of society, we mustconclude that society, considering its labors and its enjoy-ments, has lost the value of the broken window.

From which, by generalizing, we arrive at this unexpectedconclusion: “Society loses the value of objects unnecessarilydestroyed,” and at this aphorism, which will make the hair ofthe protectionists stand on end: “To break, to destroy, to dissi-pate is not to encourage national employment,” or morebriefly: “Destruction is not profitable.”

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What Is Seen and What Is Not Seen




What will the Moniteur industriel3say to this, or the disci-ples of the estimable M. de Saint-Chamans,4 who has calcu-lated with such precision what industry would gain from theburning of Paris, because of the houses that would have to berebuilt?

I am sorry to upset his ingenious calculations, especiallysince their spirit has passed into our legislation. But I beg himto begin them again, entering what is not seen in the ledgerbeside what is seen.

The reader must apply himself to observe that there arenot only two people, but three, in the little drama that I havepresented. The one, James Goodfellow, represents theconsumer, reduced by destruction to one enjoyment insteadof two. The other, under the figure of the glazier, shows us theproducer whose industry the accident encourages. The thirdis the shoemaker (or any other manufacturer) whose industryis correspondingly discouraged by the same cause. It is thisthird person who is always in the shadow, and who, personi-fying what is not seen, is an essential element of the problem.It is he who makes us understand how absurd it is to see aprofit in destruction. It is he who will soon teach us that it isequally absurd to see a profit in trade restriction, which is,after all, nothing more nor less than partial destruction. So, ifyou get to the bottom of all the arguments advanced in favorof restrictionist measures, you will find only a paraphrase ofthat common cliché: “What would become of the glaziers ifno one ever broke any windows?”

III. Taxes

Have you ever heard anyone say: “Taxes are the bestinvestment; they are a life-giving dew. See how many families

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3. [Newspaper of the Committee for the Defense of Domestic Industry, aprotectionist organization.—Translator.]

4. [Auguste, Vicomte de Saint-Chamans (1777—1861), Deputy andCouncillor of State under the Restoration, protectionist and upholder ofthe balance of trade. His celebrated stand on the “obstacle” here quoted byBastiat comes from his Nouvel essai sur la richesse des nations, 1824. Thiswork was later (1852) incorporated in his Traité d’économiepolitique.—Translator.]



they keep alive, and follow in imagination their indirecteffects on industry; they are infinite, as extensive as life itself.”

To combat this doctrine, I am obliged to repeat thepreceding refutation. Political economy knows very well thatits arguments are not diverting enough for anyone to sayabout them: Repetita placent; repetition pleases. So, likeBasile,5 political economy has “arranged” the proverb for itsown use, quite convinced that, from its mouth, Repetitadocent; repetition teaches.

The advantages that government officials enjoy indrawing their salaries are what is seen. The benefits thatresult for their suppliers are also what is seen. They are rightunder your nose.

But the disadvantage that the taxpayers try to free them-selves from is what is not seen, and the distress that resultsfrom it for the merchants who supply them is somethingfurther that is not seen, although it should stand out plainlyenough to be seen intellectually.

When a government official spends on his own behalf onehundred sous more, this implies that a taxpayer spends on hisown behalf one hundred sous the less. But the spending of thegovernment official is seen, because it is done; while that ofthe taxpayer is not seen, because—alas!—he is prevented fromdoing it.

You compare the nation to a parched piece of land and thetax to a life-giving rain. So be it. But you should also ask your-self where this rain comes from, and whether it is notprecisely the tax that draws the moisture from the soil anddries it up.

You should ask yourself further whether the soil receivesmore of this precious water from the rain than it loses by theevaporation?

What is quite certain is that, when James Goodfellowcounts out a hundred sous to the tax collector, he receivesnothing in return. When, then, a government official, inspending these hundred sous, returns them to JamesGoodfellow, it is for an equivalent value in wheat or in labor.The final result is a loss of five francs for James Goodfellow.

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5. [In Act II of The Barber of Seville, Basile, the musician, says: “I havearranged several proverbs with variations.”—Translator.]



It is quite true that often, nearly always if you will, thegovernment official renders an equivalent service to JamesGoodfellow. In this case there is no loss on either side; there isonly an exchange. Therefore, my argument is not in any wayconcerned with useful functions. I say this: If you wish tocreate a government office, prove its usefulness. Demonstratethat to James Goodfellow it is worth the equivalent of what itcosts him by virtue of the services it renders him. But apartfrom this intrinsic utility, do not cite, as an argument in favorof opening the new bureau, the advantage that it constitutesfor the bureaucrat, his family, and those who supply hisneeds; do not allege that it encourages employment.

When James Goodfellow gives a hundred sous to a govern-ment official for a really useful service, this is exactly the sameas when he gives a hundred sous to a shoemaker for a pair ofshoes. It’s a case of give-and-take, and the score is even. Butwhen James Goodfellow hands over a hundred sous to agovernment official to receive no service for it or even to besubjected to inconveniences, it is as if he were to give hismoney to a thief. It serves no purpose to say that the officialwill spend these hundred sous for the great profit of ournational industry; the more the thief can do with them, themore James Goodfellow could have done with them if he hadnot met on his way either the extralegal or the legal parasite.

Let us accustom ourselves, then, not to judge things solelyby what is seen, but rather by what is not seen.

Last year I was on the Finance Committee, for in theConstituent Assembly the members of the opposition werenot systematically excluded from all committees. In this theframers of the Constitution acted wisely. We have heardM. Thiers6 say: “I have spent my life fighting men of thelegitimist party and of the clerical party. Since, in the face of acommon danger, I have come to know them and we have hadheart-to-heart talks, I see that they are not the monsters I hadimagined.”

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6. [Adolphe Thiers (1797-1877), French statesman and distinguishedhistorian. In his long political career he was Deputy and Prime Minister(1836 and 1840), and, as a final tribute, was elected President of the ThirdRepublic in 1871.—Translator.]



Yes, enmities become exaggerated and hatreds are intensi-fied between parties that do not mingle; and if the majoritywould allow a few members of the minority to penetrate intothe circles of the committees, perhaps it would be recognizedon both sides that their ideas are not so far apart, and aboveall that their intentions are not so perverse, as supposed.

However that may be, last year I was on the FinanceCommittee. Each time that one of our colleagues spoke offixing at a moderate figure the salaries of the President of theRepublic, of cabinet ministers, and of ambassadors, he wouldbe told:

“For the good of the service, we must surround certainoffices with an aura of prestige and dignity. That is the way toattract to them men of merit. Innumerable unfortunatepeople turn to the President of the Republic, and he would bein a painful position if he were always forced to refuse themhelp. A certain amount of ostentation in the ministerial anddiplomatic salons is part of the machinery of constitutionalgovernments, etc., etc.”

Whether or not such arguments can be controverted, theycertainly deserve serious scrutiny. They are based on thepublic interest, rightly or wrongly estimated; and, personally,I can make more of a case for them than many of our Catos,moved by a narrow spirit of niggardliness or jealousy.

But what shocks my economist’s conscience, what makesme blush for the intellectual renown of my country, is whenthey go on from these arguments (as they never fail to do) tothis absurd banality (always favorably received):

“Besides, the luxury of high officials of the governmentencourages the arts, industry, and employment. The Chief ofState and his ministers cannot give banquets and partieswithout infusing life into all the veins of the body politic. Toreduce their salaries would be to starve industry in Paris and,at the same time, throughout the nation.”

For heaven’s sake, gentlemen, at least respect arithmetic,and do not come before the National Assembly of France andsay, for fear that, to its shame, it will not support you, that anaddition gives a different sum depending upon whether it isadded from top to bottom or from bottom to top.

Well, then, suppose I arrange to have a navvy dig me aditch in my field for the sum of a hundred sous. Just as I

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conclude this agreement, the tax collector takes my hundredsous from me and has them passed on to the Minister of theInterior. My contract is broken, but the Minister will addanother dish at his dinner. On what basis do you dare toaffirm that this official expenditure is an addition to thenational industry? Do you not see that it is only a simpletransfer of consumption and of labor? A cabinet minister hashis table more lavishly set, it is true; but a farmer has his fieldless well drained, and this is just as true. A Parisian catererhas gained a hundred sous, I grant you; but grant me that aprovincial ditchdigger has lost five francs. All that one can sayis that the official dish and the satisfied caterer are what isseen; the swampy field and the excavator out of work arewhat is not seen.

Good Lord! What a lot of trouble to prove in politicaleconomy that two and two make four; and if you succeed indoing so, people cry, “It is so clear that it is boring.” Then theyvote as if you had never proved anything at all.

V. Public Works

Nothing is more natural than that a nation, after makingsure that a great enterprise will profit the community, shouldhave such an enterprise carried out with funds collected fromthe citizenry. But I lose patience completely, I confess, when Ihear alleged in support of such a resolution this economicfallacy: “Besides, it is a way of creating jobs for theworkers.”The state opens a road, builds a palace, repairs astreet, digs a canal; with these projects it gives jobs to certainworkers. That is what is seen. But it deprives certain otherlaborers of employment. That is what is not seen.Suppose aroad is under construction. A thousand laborers arrive everymorning, go home every evening, and receive their wages;that is certain. If the road had not been authorized, if funds forit had not been voted, these good people would have neitherfound this work nor earned these wages; that again iscertain.But is this all? Taken all together, does not the opera-tion involve something else? At the moment when M. Dupin7

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7. [Charles Dupin (1784-1873), distinguished French engineer andeconomist, professor at the Conservatory of Arts and Crafts, Deputy, andSenator. His greatest contribution to political economy was in the field ofeconomic statistics.—Translator.]



pronounces the sacramental words: “The Assembly hasadopted,….” do millions of francs descend miraculously on amoonbeam into the coffers of M. Fould8 and M. Bineau?9 Forthe process to be complete, does not the state have to organizethe collection of funds as well as their expenditure? Does itnot have to get its tax collectors into the country and itstaxpayers to make their contribution?Study the question,then, from its two aspects. In noting what the state is going todo with the millions of francs voted, do not neglect to notealso what the taxpayers would have done—and can no longerdo—with these same millions. You see, then, that a publicenterprise is a coin with two sides. On one, the figure of a busyworker, with this device: What is seen; on the other, an unem-ployed worker, with this device: What is not seen.Thesophism that I am attacking in this essay is all the moredangerous when applied to public works, since it serves tojustify the most foolishly prodigal enterprises. When a rail-road or a bridge has real utility, it suffices to rely on this fact inarguing in its favor. But if one cannot do this, what does onedo? One has recourse to this mumbo jumbo: “We must createjobs for the workers.”This means that the terraces of theChamp-de-Mars are ordered first to be built up and then to betorn down. The great Napoleon, it is said, thought he wasdoing philanthropic work when he had ditches dug and thenfilled in. He also said: “What difference does the result make?All we need is to see wealth spread among the laboringclasses.”

Let us get to the bottom of things. Money creates an illu-sion for us. To ask for co-operation, in the form of money,from all the citizens in a common enterprise is, in reality, toask of them actual physical co-operation, for each one of themprocures for himself by his labor the amount he is taxed. Now,if we were to gather together all the citizens and exact theirservices from them in order to have a piece of work performedthat is useful to all, this would be understandable; their recom-pense would consist in the results of the work itself. But if,after being brought together, they were forced to build roads

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8. [Achille Fould (1800-1867), politician and financier.—Translator.]

9. [Jean Martial Bineau (1805—1855), engineer and politician, Minister ofFinance in 1852.—Translator.]



on which no one would travel, or palaces that no one wouldlive in, all under the pretext of providing work for them, itwould seem absurd, and they would certainly be justified inobjecting: We will have none of that kind of work. We wouldrather work for ourselves.

Having the citizens contribute money, and not labor,changes nothing in the general results. But if labor werecontributed, the loss would be shared by everyone. Wheremoney is contributed, those whom the state keeps busyescape their share of the loss, while adding much more to thatwhich their compatriots already have to suffer.

There is an article in the Constitution which states:“Society assists and encourages the development of

labor…. through the establishment by the state, the depart-ments, and the municipalities, of appropriate public works toemploy idle hands.”

As a temporary measure in a time of crisis, during a severewinter, this intervention on the part of the taxpayer couldhave good effects. It acts in the same way as insurance. It addsnothing to the number of jobs nor to total wages, but it takeslabor and wages from ordinary times and doles them out, at aloss it is true, in difficult times.

As a permanent, general, systematic measure, it isnothing but a ruinous hoax, an impossibility, a contradiction,which makes a great show of the little work that it has stimu-lated, which is what is seen, and conceals the much largeramount of work that it has precluded, which is what is notseen.

VIII. Machines

“A curse on machines! Every year their increasing powercondemns to pauperism millions of workers, taking their jobsaway from them, and with their jobs their wages, and withtheir wages their bread! A curse on machines!”

That is the cry rising from ignorant prejudice, and whoseecho resounds in the newspapers.

But to curse machines is to curse the human mind!What puzzles me is that it is possible to find anyone at all

who can be content with such a doctrine.

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For, in the last analysis, if it is true, what is its strictlylogical consequence? It is that activity, well-being, wealth,and happiness are possible only for stupid nations, mentallystatic, to whom God has not given the disastrous gift ofthinking, observing, contriving, inventing, obtaining thegreatest results with the least trouble. On the contrary, rags,miserable huts, poverty, and stagnation are the inevitableportion of every nation that looks for and finds in iron, fire,wind, electricity, magnetism, the laws of chemistry andmechanics—in a word, in the forces of Nature—an addition toits own resources, and it is indeed appropriate to say withRousseau: “Every man who thinks is a depraved animal.”

But this is not all. If this doctrine is true, and as all menthink and invent, as all, in fact, from first to last, and at everyminute of their existence, seek to make the forces of Natureco-operate with them, to do more with less, to reduce theirown manual labor or that of those whom they pay, to attainthe greatest possible sum of satisfactions with the leastpossible amount of work; we must conclude that all mankindis on the way to decadence, precisely because of this intelli-gent aspiration towards progress that seems to torment everyone of its members.

Hence, it would have to be established statistically thatthe inhabitants of Lancaster, fleeing that machine-riddencountry, go in search of employment to Ireland, wheremachines are unknown; and, historically, that the shadow ofbarbarism darkens the epochs of civilization, and that civiliza-tion flourishes in times of ignorance and barbarism.

Evidently there is in this mass of contradictions some-thing that shocks us and warns us that the problem concealsan element essential to its solution that has not been suffi-ciently brought to light.

The whole mystery consists in this: behind what is seenlies what is not seen. I am going to try to shed some light on it.My demonstration can be nothing but a repetition of thepreceding one, for the problem is the same.

Men have a natural inclination, if they are not preventedby force, to go for a bargain—that is, for something that, foran equivalent satisfaction, spares them labor—whether thisbargain comes to them from a capable foreign producer orfrom a capable mechanical producer.

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The theoretical objection that is raised against this inclina-tion is the same in both cases. In one as in the other, thereproach is made that it apparently makes for a scarcity ofjobs. However, its actual effect is not to make jobs scarce, butto free men’s labor for other jobs.

And that is why, in practice, the same obstacle—force—isset up against it in both cases. The legislator prohibits foreigncompetition and forbids mechanical competition. For whatother means can there be to stifle an inclination natural to allmen than to take away their freedom?

In many countries, it is true, the legislator strikes at onlyone of these types of competition and confines himself togrumbling about the other. This proves only that in thesecountries the legislator is inconsistent.

That should not surprise us. On a false path there isalways inconsistency; if this were not so, mankind would bedestroyed. We have never seen and never shall see a false prin-ciple carried out completely. I have said elsewhere: Absurdityis the limit of inconsistency. I should like to add: It is also itsproof.

Let us go on with our demonstration; it will not belengthy.

James Goodfellow had two francs that he let two workersearn.

But now suppose that he devises an arrangement of ropesand weights that will shorten the work by half.

Then he obtains the same satisfaction, saves a franc, anddischarges a worker.

He discharges a worker: that is what is seen.Seeing only this, people say: “See how misery follows civi-

lization! See how freedom is fatal to equality! The humanmind has made a conquest, and immediately another workerhas forever fallen into the abyss of poverty. Perhaps JamesGoodfellow can still continue to have both men work for him,but he cannot give them more than ten sous each, for they willcompete with one another and will offer their services at alower rate. This is how the rich get richer and the poor becomepoorer. We must remake society.”

A fine conclusion, and one worthy of the initial premise!

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Fortunately, both premise and conclusion are false,because behind the half of the phenomenon that is seen is theother half that is not seen.

The franc saved by James Goodfellow and the necessaryeffects of this saving are not seen.

Since, as a result of his own invention, James Goodfellowno longer spends more than one franc for manual labor in thepursuit of a given satisfaction, he has another franc left over.

If, then, there is somewhere an idle worker who offers hislabor on the market, there is also somewhere a capitalist whooffers his idle franc. These two elements meet and combine.

And it is clear as day that between the supply of and thedemand for labor, between the supply of and the demand forwages, the relationship has in no way changed.

The invention and the worker, paid with the first franc,now do the work previously accomplished by two workers.

The second worker, paid with the second franc, performssome new work.

What has then been changed in the world? There is onenational satisfaction the more; in other words, the inventionis a gratuitous conquest, a gratuitous profit for mankind.

From the form in which I have given my demonstrationwe could draw this conclusion:

“It is the capitalist who derives all the benefits flowingfrom the invention of machines. The laboring class, eventhough it suffers from them only temporarily, never profitsfrom them, since, according to what you yourself say, theyreallocate a portion of the nation’s industry without dimin-ishing it, it is true, but also without increasing it.”

It is not within the province of this essay to answer allobjections. Its only object is to combat an ignorant prejudice,very dangerous and extremely widespread. I wished to provethat a new machine, in making a certain number of workersavailable for jobs, necessarily makes available at the sametime the money that pays them. These workers and thismoney get together eventually to produce something that wasimpossible to produce before the invention; from which itfollows that the final result of the invention is an increase insatisfactions with the same amount of labor.

Who reaps this excess of satisfactions?

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Yes, at first it is the capitalist, the inventor, the first onewho uses the machine successfully, and this is the reward forhis genius and daring. In this case, as we have just seen, herealizes a saving on the costs of production, which, no matterhow it is spent (and it always is), gives employment to just asmany hands as the machine has made idle.

But soon competition forces him to lower his selling priceby the amount of this saving itself.

And then it is no longer the inventor who reaps the bene-fits of the invention; it is the buyer of the product, theconsumer, the public, including the workers—in a word, it ismankind.

And what is not seen is that the saving, thus procured forall the consumers, forms a fund from which wages can bedrawn, replacing what the machine has drained off.

Thus (taking up again the foregoing example), JamesGoodfellow obtains a product by spending two francs forwages.

Thanks to his invention, the manual labor now costs himonly one franc.

As long as he sells the product at the same price, there isone worker the fewer employed in making this specialproduct: that is what is seen; but there is one worker the moreemployed by the franc James Goodfellow has saved: that iswhat is not seen.

When, in the natural course of events, James Goodfellowis reduced to lowering by one franc the price of the product, heno longer realizes a saving; then he no longer releases a francfor national employment in new production. But whoeveracquires it, i.e., mankind, takes his place. Whoever buys theproduct pays one franc less, saves a franc, and necessarilyhands over this saving to the fund for wages; this is againwhat is not seen.

Another solution to this problem, one founded on thefacts, has been advanced.

Some have said: “The machine reduces the expenses ofproduction and lowers the price of the product. The loweringof the price stimulates an increase in consumption, whichnecessitates an increase in production, and, finally, the use ofas many workers as before the invention—or more.” In

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support of this argument they cite printing, spinning, thepress, etc.

This demonstration is not scientific.We should have to conclude from it that, if the consump-

tion of the special product in question remains stationary ornearly so, the machine will be harmful to employment. This isnot so.

Suppose that in a certain country all the men wear hats. Ifwith a machine the price of hats can be reduced by half, it doesnot necessarily follow that twice as many hats will be bought.

Will it be said, in that case, that a part of the nationallabor force has been made idle? Yes, according to ignorantreasoning. No, according to mine; for, even though in thatcountry no one were to buy a single extra hat, the entire fundfor wages would nevertheless remain intact; whatever did notgo to the hat industry would be found in the saving realized byall consumers and would go to pay wages for the whole of thelabor force that the machine had rendered unnecessary and tostimulate a new development of all industries.

And this is, in fact, the way things happen. I have seennewspapers at 80 francs; now they sell for 48. This is a savingof 32 francs for the subscribers. It is not certain, at least it isnot inevitable, that the 32 francs continue to go into jour-nalism; but what is certain, what is inevitable, is that, if theydo not take this direction, they will take another. One francwill be used to buy more newspapers, another for more food, athird for better clothes, a fourth for better furniture.

Thus, all industries are interrelated. They form a vastnetwork in which all the lines communicate by secret chan-nels. What is saved in one profits all. What is important is tounderstand clearly that never, never are economies effected atthe expense of jobs and wages.

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IX. Credit

At all times, but especially in the last few years, peoplehave dreamt of universalizing wealth by universalizing credit.

I am sure I do not exaggerate in saying that since theFebruary Revolution10 the Paris presses have spewed forthmore than ten thousand brochures extolling this solution ofthe social problem.

This solution, alas, has as its foundation merely an opticalillusion, in so far as an illusion can serve as a foundation foranything.

These people begin by confusing hard money with prod-ucts; then they confuse paper money with hard money; and itis from these two confusions that they profess to derive a fact.

In this question it is absolutely necessary to forget money,coins, bank notes, and the other media by which productspass from hand to hand, in order to see only the productsthemselves, which constitute the real substance of a loan.

For when a farmer borrows fifty francs to buy a plow, it isnot actually the fifty francs that is lent to him; it is the plow.

And when a merchant borrows twenty thousand francs tobuy a house, it is not the twenty thousand francs he owes; it isthe house.

Money makes its appearance only to facilitate the arrange-ment among several parties.

Peter may not be disposed to lend his plow, but Jamesmay be willing to lend his money. What does William do then?He borrows the money from James, and with this money hebuys the plow from Peter.

But actually nobody borrows money for the sake of themoney itself. We borrow money to get products.

Now, in no country is it possible to transfer from onehand to another more products than there are.

Whatever the sum of hard money and bills that circulates,the borrowers taken together cannot get more plows, houses,

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10. [Popular demonstrations against Prime Minister Guizot on February 22,1848, resulted in his dismissal by King Louis Philippe. This prudent move,however, proved unavailing for the King, because the next day troops firedon a group of demonstrators, and the people of Paris responded with anarmed revolt, which brought about the abdication of Louis Philippe andthe establishment of the Second Republic.—Translator.]



tools, provisions, or raw materials than the total number oflenders can furnish.

For let us keep well in mind that every borrower presup-poses a lender, that every borrowing implies a loan.

This much being granted, what good can credit institu-tions do? They can make it easier for borrowers and lenders tofind one another and reach an understanding. But what theycannot do is to increase instantaneously the total number ofobjects borrowed and lent.

However, the credit organizations would have to do justthis in order for the end of the social reformers to be attained,since these gentlemen aspire to nothing less than to giveplows, houses, tools, provisions, and raw materials toeveryone who wants them.

And how do they imagine they will do this?By giving to loans the guarantee of the state.Let us go more deeply into the matter, for there is some-

thing here that is seen and something that is not seen. Let ustry to see both.

Suppose that there is only one plow in the world and thattwo farmers want it.

Peter is the owner of the only plow available in France.John and James wish to borrow it. John, with his honesty, hisproperty, and his good name, offers guarantees. One believesin him; he has credit. James does not inspire confidence or atany rate seems less reliable. Naturally, Peter lends his plow toJohn.

But now, under socialist inspiration, the state intervenesand says to Peter: “Lend your plow to James. We will guar-antee you reimbursement, and this guarantee is worth morethan John’s, for he is the only one responsible for himself, andwe, though it is true we have nothing, dispose of the wealth ofall the taxpayers; if necessary, we will pay back the principaland the interest with their money.”

So Peter lends his plow to James; this is what is seen.And the socialists congratulate themselves, saying, “See

how our plan has succeeded. Thanks to the intervention of thestate, poor James has a plow. He no longer has to spade byhand; he is on the way to making his fortune. It is a benefit forhim and a profit for the nation as a whole.”

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Oh no, gentlemen, it is not a profit for the nation, for hereis what is not seen.

It is not seen that the plow goes to James because it didnot go to John.

It is not seen that if James pushes a plow instead ofspading, John will be reduced to spading instead of plowing.

Consequently, what one would like to think of as an addi-tional loan is only the reallocation of a loan.

Furthermore, it is not seen that this reallocation involvestwo profound injustices: injustice to John, who, after havingmerited and won credit by his honesty and his energy, seeshimself deprived; injustice to the taxpayers, obligated to pay adebt that does not concern them.

Will it be said that the government offers to John thesame opportunities it does to James? But since there is onlyone plow available, two cannot be lent. The argument alwayscomes back to the statement that, thanks to the interventionof the state, more will be borrowed than can be lent, for theplow represents here the total of available capital.

True, I have reduced the operation to its simplest terms;but test by the same touchstone the most complicated govern-mental credit institutions, and you will be convinced that theycan have but one result: to reallocate credit, not to increase it.In a given country and at a given time, there is only a certainsum of available capital, and it is all placed somewhere. Byguaranteeing insolvent debtors, the state can certainlyincrease the number of borrowers, raise the rate of interest(all at the expense of the taxpayer), but it cannot increase thenumber of lenders and the total value of the loans.

Do not impute to me, however, a conclusion from which Ibeg Heaven to preserve me. I say that the law should not artifi-cially encourage borrowing; but I do not say that it shouldhinder it artificially. If in our hypothetical system or else-where there should be obstacles to the diffusion and applica-tion of credit, let the law remove them; nothing could bebetter or more just. But that, along with liberty, is all thatsocial reformers worthy of the name should ask of the law.





Abundance and Scarcity

Which is preferable for man and for society, abundanceor scarcity?“What!” people may exclaim. “How can there be any

question about it? Has anyone ever suggested, or is it possibleto maintain, that scarcity is the basis of man’s well-being?”

Yes, this has been suggested; yes, this has been main-tained and is maintained every day, and I do not hesitate tosay that the theory of scarcity is by far the most popular of alltheories. It is the burden of conversations, newspaper articles,books, and political speeches; and, strange as it may seem, itis certain that political economy will not have completed itstask and performed its practical function until it has popular-ized and established as indisputable this very simple proposi-tion: “Wealth consists in an abundance of commodities.”

Do we not hear it said every day: “Foreigners are going toflood us with their products”? Thus, people fear abundance.

Has not M. de Saint-Cricq1 said: “There is overproduc-tion”? Thus, he was afraid of abundance.

Do not the workers wreck machines? Thus, they are afraidof overproduction, or—in other words—of abundance.

Has not M. Bugeaud2 uttered these words: “Let bread bedear, and the farmer will be rich”? Now, bread can be dearonly because it is scarce. Thus, M. Bugeaud was extolling scar-city.

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1. [Pierre Laurent Barthélemy, Comte de Saint-Cricq, member of theChamber of Deputies, Minister of Commerce from January 4, 1828 toAugust 8, 1829, and later a Peer of France.—Translator.]

2. [T. R. Bugeaud de la Piconnerie (1784-1849), known chiefly as a militaryleader. He was also a member of the Chamber of Deputies, and wasinterested in agriculture, and endorsed protectionist principles.—Translator.]



Has not M. d’Argout3 based his argument against thesugar industry on its very productivity? Has he not said againand again: “The sugar beet has no future, and its cultivationcannot be extended, because just a few hectares of sugar beetsin each department would be enough to supply all theconsumers in France”? Thus, as he sees things, good consistsin barrenness and scarcity; and evil, in fertility and abun-dance.

Do not La Presse, Le Commerce, and the majority of thedaily newspapers publish one or more articles every morningto prove to the Chambers and to the government that it issound policy to legislate higher prices for everything throughmanipulation of the tariff? Do not the Chambers and thegovernment every day comply with this injunction from thepress? But tariffs raise the prices of things only because theyreduce their supply in the market! Thus, the newspapers, theChambers, and the government put the theory of scarcity intopractice, and I was right to say that this theory is by far themost popular of all theories.

How does it happen that in the eyes of workers, of publi-cists, and of statesmen, abundance seems dangerous and scar-city advantageous? I propose to trace this illusion to itssource.

We observe that a man acquires wealth in proportion ashe puts his labor to better account, that is to say, as he sells ata higher price. He sells at a higher price in proportion to theshortage, the scarcity, of the type of commodity produced byhis labor. We conclude from this that, at least so far as he isconcerned, scarcity enriches him. Applying this mode ofreasoning successively to all workers, we deduce from it thetheory of scarcity. Thereupon we proceed to put the theoryinto practice, and, in order to favor all producers, we artifi-cially raise prices and cause a scarcity of all goods by restric-tive and protectionist measures, the elimination ofmachinery, and other analogous means.

The same holds true of abundance. We observe that,when a product is plentiful, it sells at a low price; thus, the

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3. [Antoine Maurice Appolinaire, Comte d’Argout (1782-1858),administrator and fiscal specialist, Governor of the Bank ofFrance.—Translator.]



producer earns less. If all the producers are in this plight, theyare all poverty-stricken; hence, it is abundance that ruinssociety. And, as every person holding a theory seeks to put itinto practice, one sees in many countries the laws of manwarring against the abundance of things.

This sophism, phrased as a generalization, would perhapsmake little impression; but, when applied to a particular set offacts—to this or that industry or to a given class ofproducers—it is extremely specious, and this is easilyexplained. It constitutes a syllogism which, although notfalse, is incomplete. Now, what is true in a syllogism is alwaysand necessarily present to the mind. But what is incomplete isa negative quantity, a missing element that it is quite possibleand even very easy not to take into account.

Man produces in order to consume. He is at once bothproducer and consumer. The argument that I have just setforth considers him only from the first of these points of view.From the second, the argument would lead to an oppositeconclusion. Could we not say, in fact:

The consumer becomes richer in proportion as he buyseverything more cheaply; he buys things more cheaply inproportion as they are abundant; hence, abundance enricheshim; and this argument, extended to all consumers, wouldlead to the theory of abundance!

It is an imperfect understanding of the concept ofexchange that produces these illusions. If we analyze thenature of our self-interest, we realize clearly that it is double.As sellers, we are interested in high prices, and, consequently,in scarcity; as buyers, we are interested in low prices, or, whatamounts to the same thing, in an abundance of goods. Wecannot, then, base our argument on one or the other of thesetwo aspects of self-interest without determining beforehandwhich of the two coincides with and is identifiable with thegeneral and permanent interest of the human race.

If man were a solitary animal, if he worked solely forhimself, if he consumed directly the fruits of his labor—inshort, if he did not engage in exchange—the theory of scarcitycould never have been introduced into the world. It would beall too evident, in that case, that abundance would be advanta-geous for him, whatever its source, whether he owed it to hisindustriousness, to the ingenious tools and powerful

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machines that he had invented, to the fertility of the soil, tothe liberality of Nature, or even to a mysterious invasion ofgoods that the tide had carried from abroad and left on theshore. No solitary man would ever conclude that, in order tomake sure that his own labor had something to occupy it, heshould break the tools that save him labor, neutralize thefertility of the soil, or return to the sea the goods it may havebrought him. He would easily understand that labor is not anend in itself, but a means, and that it would be absurd to rejectthe end for fear of doing injury to the means. He would under-stand, too, that if he devotes two hours of the day to providingfor his needs, any circumstance (machinery, the fertility of thesoil, a gratuitous gift, no matter what) that saves him an hourof this labor, so long as the product is as great, puts that hourat his disposal, and that he can devote it to improving hiswell-being, He would understand, in short, that a saving inlabor is nothing else than progress.

But exchange hampers our view of so simple a truth. Insociety, with the division of labor that it entails, the produc-tion and the consumption of an object are not performed bythe same individual. Each person comes to regard his labor nolonger as a means, but as an end. Exchange creates, in relationto each object, two interests, that of its producer and that of itsconsumer; and these two interests are always directlyopposed to each other.

It is essential to analyze them and to study their nature.Take the case of any producer. In what does his imme-

diate self-interest consist? It consists in two things: (1) thatthe smallest possible number of persons engage in the samekind of labor as he; and (2) that the greatest possible numberof persons be in quest of the product of his labor. Politicaleconomy expresses this more succinctly in these terms: thatthe supply be very limited, and the demand very extensive; instill other terms: limited competition, and unlimited market.

In what does the immediate self-interest of the consumerconsist? That the supply of the product he wants be extensive,and the demand limited.

Since these two interests are mutually incompatible, oneof them must necessarily coincide with the social or generalinterest, and the other must be hostile to it.

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But which one should legislation favor, as being theexpression of the public weal—if, indeed, it should favoreither one of them?

To know this, it suffices to discover what would happen ifthe secret desires of men were fulfilled.

In so far as we are producers, it must be admitted, each ofus has hopes that are antisocial. Are we vineyardists? Weshould be little displeased if all the vines in the world saveours were blighted by frost: this is the theory of scarcity. Arewe the owners of ironworks? We want no other iron to be onthe market but our own, whatever may be the public need forit, precisely because this need, keenly felt and incompletelysatisfied, brings us a high price: this too is the theory of scar-city. Are we farmers? We say, with M. Bugeaud: Let bread becostly, that is to say, scarce, and the farmers will prosper: thisis still the theory of scarcity.

Are we physicians? We cannot blind ourselves to the factthat certain physical improvements, such as better public sani-tation, the development of such moral virtues as moderationand temperance, the progress of knowledge to the point atwhich everyone can take care of his own health, and thediscovery of certain simple, easily applied remedies, would bejust so many deadly blows struck at our profession. In so far aswe are physicians, our secret wishes are antisocial. I do notmean to say that physicians actually give expression to suchwishes. I like to believe that they would welcome with joy thediscovery of a universal cure; but it would not be as physi-cians, but as men and as Christians that they would yield tosuch an impulse: by a laudable art of self-abnegation, theywould take the point of view of the consumer. But in so far asthe physician practices a profession, in so far as he owes tothat profession his well-being, his prestige, and even themeans of supporting his family, it is impossible for hisdesires—or, if you will, his interests—not to be antisocial.

Do we make cotton textiles? We wish to sell them at theprice that is most advantageous for us. We should heartilyapprove the proscription of all rival manufacturers; andthough we do not dare to express this wish publicly or to seekits full realization with any likelihood of success, we neverthe-less attain it to a certain extent by roundabout means: forexample, by excluding foreign textiles, so as to diminish the

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supply, and thereby to produce, by the use of force and to ourprofit, a scarcity of clothing.

In the same way, we could make a survey of all industries,and we should always find that producers, as such, have anti-social attitudes. “The merchant,” says Montaigne, “prospersonly by the extravagance of youth; the farmer, by the high costof grain; the architect, by the decay of houses; officers ofjustice, by men’s lawsuits and quarrels. Even the ministers ofreligion owe the honor and practice of their high calling to ourdeath and our vices. No physician takes pleasure in the goodhealth of even his friends; no soldier, in the peace of hiscountry; and so it goes for the rest.”

It follows that, if the secret wishes of each producer wererealized, the world would speedily retrogress toward barba-rism. The sail would take the place of steam, the oar wouldreplace the sail, and it in turn would have to yield to thewagon, the latter to the mule, and the mule to the packman.Wool would ban cotton, cotton would ban wool, and so on,until the scarcity of all things made man himself disappearfrom the face of the earth.

Suppose for a moment that legislative power and execu-tive authority were put at the disposal of the MimerelCommittee,4 and that each of the members of that associationhad the right to introduce and enact a favorite law. Is it veryhard to imagine what sort of industrial code the public wouldbe subjected to?

If we now turn to consider the immediate self-interest ofthe consumer, we shall find that it is in perfect harmony withthe general interest, i.e., with what the well-being of mankindrequires. When the buyer goes to the market, he wants to findit abundantly supplied. He wants the seasons to be propitiousfor all the crops; more and more wonderful inventions tobring a greater number of products and satisfactions withinhis reach; time and labor to be saved; distances to be wipedout; the spirit of peace and justice to permit lessening theburden of taxes; and tariff walls of every sort to fall. In allthese respects, the immediate self-interest of the consumerfollows a line parallel to that of the public interest. He may

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4. [A businessmen’s association headed by P. A. H. Mimerel de Roubaix(1786-1871), a textile manufacturer.—Translator.]



extend his secret wishes to fantastic or absurd lengths; yetthey will not cease to be in conformity with the interests of hisfellow man. He may wish that food and shelter, roof andhearth, education and morality, security and peace, strengthand health, all be his without effort, without toil, and withoutlimit, like the dust of the roads, the water of the stream, the airthat surrounds us, and the sunlight that bathes us; and yet therealization of these wishes would in no way conflict with thegood of society.

Perhaps people will say that, if these wishes were granted,the producer’s labor would be more and more limited, andfinally would cease for want of anything to occupy it. But why?Because, in this extreme hypothetical case, all imaginablewants and desires world be fully satisfied. Man, like theAlmighty, would create all things by a simple act of volition.Will someone tell me what reason there would be, on thishypothesis, to deplore the end of industrial production?

I referred just now to an imaginary legislative assemblycomposed of businessmen, in which each member world havethe power to enact a law expressing his secret wish in hiscapacity as a producer; and I said that the laws emanatingfrom such an assembly would create a system of monopolyand put into practice the theory of scarcity.

In the same way, a Chamber of Deputies in which eachmember considered solely his immediate self-interest as aconsumer would end by creating a system of free trade,repealing all restrictive laws, and removing all man-madecommercial barriers—in short, by putting into practice thetheory of abundance.

Hence, it follows that to consult solely the immediateself-interest of the producer is to have regard for an antisocialinterest; whereas to consider as fundamental solely the imme-diate self-interest of the consumer is to take the generalinterest as the foundation of social policy.

Allow me to emphasize this point, at the risk of repeatingmyself.

There is a fundamental antagonism between the sellerand the buyer.

The former wants the goods on the market to be scarce, inshort supply, and expensive.

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The latter wants them abundant, in plentiful supply, andcheap.

Our laws, which should at least be neutral, take the side ofthe seller against the buyer, of the producer against theconsumer, of high prices against low prices,5 of scarcityagainst abundance.

They operate, if not intentionally, at least logically, on theassumption that a nation is rich when it is lacking in every-thing.

For they say it is the producer who must be favored, bybeing assured a good market for his product. To achieve thisend, it is necessary to raise its price; to raise its price, it isnecessary to limit the supply; and to limit the supply is tocreate scarcity.

Just suppose that, at the present moment, when theselaws are in full force, a complete inventory were taken, not interms of monetary value, but in terms of weight, size, volume,and quantity, of all the objects existing in France that arecapable of satisfying the wants and tastes of its people—meat,cloth, fuel, wheat, colonial products, etc.

Suppose further that the following day all barriers to theimportation of foreign goods into France were removed.

Finally, suppose that, in order to determine the conse-quences of this reform, a second inventory is taken threemonths later.

Is it not true that there will be in France more wheat, live-stock, cloth, linen, iron, coal, sugar, etc., at the time of thesecond inventory than at the time of the first?

This is so true that our protective tariffs have no othergoal than to prevent us from importing all these things, tolimit their supply, to forestall a decline in their prices, and toprevent their abundance.

Now, are we to believe that the people are better fed underthe laws that prevail at present, because there is less bread,meat, and sugar in the country? Are they better clad, because

36



5. We have no noun in French to express the idea that is opposite to highprice (“cheapness” in English). It is quite noteworthy that the peopleinstinctively express this idea by this paraphrase: advantageous market,good market [bon marché]. The protectionists really ought to dosomething about changing this expression. It implies a whole economicsystem that is the converse of theirs.



there is less linen and woolen cloth? Are their houses betterheated, because there is less coal? Is their labor made easierbecause there is less iron and copper, or because there arefewer tools and machines?

But, you say, if foreigners flood us with their products,they will carry off our money!

Well, what difference does that make? Men are not fed oncash, they do not clothe themselves with gold, nor do theyheat their houses with silver. What difference does it makewhether there is more or less money in the country, if there ismore bread in the cupboard, more meat in the larder, moreclothing in the wardrobe, and more wood is the woodshed?

Restrictive laws always present us with the samedilemma.

Either we admit that they produce scarcity, or we do notadmit it.

If we do admit it, we thereby confess that they inflict uponthe people all the harm that they can do. If we do not admit it,then we deny that they limit the supply of goods and raisetheir prices, and consequently they deny that they favor theproducer.

Such laws are either injurious or ineffective. They cannotbe useful.








A PetitionFrom the Manufacturers of Candles,Tapers, Lanterns, Candlesticks,Street Lamps, Snuffers, andExtinguishers, and from theProducers of Tallow, Oil, Resin,Alcohol, and Generally ofEverything Connectedwith Lighting.

To the Honorable Members of the Chamber of Deputies.Gentlemen:You are on the right track. You reject abstract theories

and have little regard for abundance and low prices. Youconcern yourselves mainly with the fate of the producer. Youwish to free him from foreign competition, that is, to reservethe domestic market for domestic industry.

We come to offer you a wonderful opportunity forapplying your—what shall we call it? Your theory? No,nothing is more deceptive than theory. Your doctrine? Yoursystem? Your principle? But you dislike doctrines, you have ahorror of systems, and, as for principles, you deny that thereare any in political economy; therefore we shall call it yourpractice—your practice without theory and without principle.

We are suffering from the ruinous competition of aforeign rival who apparently works under conditions so farsuperior to our own for the production of light that he isflooding the domestic market with it at an incredibly lowprice; from the moment he appears, our sales cease, all theconsumers turn to him, and a branch of French industrywhose ramifications are innumerable is all at once reduced tocomplete stagnation. This rival, which is none other than thesun, is waging war on us so mercilessly that we suspect he isbeing stirred up against us by perfidious Albion (excellentdiplomacy nowadays!), particularly because he has for thathaughty island a respect that he does not show for us.1

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1. [“Perfidious Albion” is England, along with a typically French jibe at theEnglish fog, which keeps the sun from interfering with artificial light inEngland as much as it does in France. During the 1840’s, Franco-Englishrelations were occasionally very tense.—Translator.]



We ask you to be so good as to pass a law requiring theclosing of all windows, dormers, skylights, inside and outsideshutters, curtains, casements, bull’s-eyes, deadlights, andblinds—in short, all openings, holes, chinks, and fissuresthrough which the light of the sun is wont to enter houses, tothe detriment of the fair industries with which, we are proudto say, we have endowed the country, a country that cannot,without betraying ingratitude, abandon us today to sounequal a combat.

Be good enough, honorable deputies, to take our requestseriously, and do not reject it without at least hearing thereasons that we have to advance in its support.

First, if you shut off as much as possible all access tonatural light, and thereby create a need for artificial light,what industry in France will not ultimately be encouraged?

If France consumes more tallow, there will have to bemore cattle and sheep, and, consequently, we shall see anincrease in cleared fields, meat, wool, leather, and especiallymanure, the basis of all agricultural wealth.

If France consumes more oil, we shall see an expansion inthe cultivation of the poppy, the olive, and rapeseed. Theserich yet soil-exhausting plants will come at just the right timeto enable us to put to profitable use the increased fertility thatthe breeding of cattle will impart to the land.

Our moors will be covered with resinous trees. Numerousswarms of bees will gather from our mountains the perfumedtreasures that today waste their fragrance, like the flowersfrom which they emanate. Thus, there is not one branch ofagriculture that would not undergo a great expansion.

The same holds true of shipping. Thousands of vesselswill engage in whaling, and in a short time we shall have afleet capable of upholding the honor of France and of grati-fying the patriotic aspirations of the undersigned petitioners,chandlers, etc.

But what shall we say of the specialties of Parisian manu-facture? Henceforth you will behold gilding, bronze, andcrystal in candlesticks, in lamps, in chandeliers, in candelabrasparkling in spacious emporia compared with which those oftoday are but stalls.

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There is no needy resin-collector on the heights of hissand dunes, no poor miner in the depths of his black pit, whowill not receive higher wages and enjoy increased prosperity.

It needs but a little reflection, gentlemen, to be convincedthat there is perhaps not one Frenchman, from the wealthystockholder of the Anzin Company to the humblest vendor ofmatches, whose condition would not be improved by thesuccess of our petition.

We anticipate your objections, gentlemen; but there is nota single one of them that you have not picked up from themusty old books of the advocates of free trade. We defy you toutter a word against us that will not instantly rebound againstyourselves and the principle that guides your entire policy.

Will you tell us that, though we may gain by this protec-tion, France will not gain at all, because the consumer willbear the expense?

We have our answer ready:You no longer have the right to invoke the interests of the

consumer. You have sacrificed him whenever you have foundhis interests opposed to those of the producer. You have doneso in order to encourage industry and to increase employ-ment. For the same reason you ought to do so this time too.

Indeed, you yourselves have anticipated this objection.When told that the consumer has a stake in the free entry ofiron, coal, sesame, wheat, and textiles, “Yes,” you reply, “butthe producer has a stake in their exclusion.” Very well! Surelyif consumers have a stake in the admission of natural light,producers have a stake in its interdiction.

“But,” you may still say, “the producer and the consumerare one and the same person. If the manufacturer profits byprotection, he will make the farmer prosperous. Contrariwise,if agriculture is prosperous, it will open markets for manufac-tured goods.” Very well! If you grant us a monopoly over theproduction of lighting during the day, first of all we shall buylarge amounts of tallow, charcoal, oil, resin, wax, alcohol,silver, iron, bronze, and crystal, to supply our industry; and,moreover, we and our numerous suppliers, having becomerich, will consume a great deal and spread prosperity into allareas of domestic industry.

Will you say that the light of the sun is a gratuitous gift ofNature, and that to reject such gifts would be to reject wealth

41

A Petition




itself under the pretext of encouraging the means of acquiringit?

But if you take this position, you strike a mortal blow atyour own policy; remember that up to now you have alwaysexcluded foreign goods because and in proportion as theyapproximate gratuitous gifts. You have only half as good areason for complying with the demands of other monopolistsas you have for granting our petition, which is in completeaccord with your established policy; and to reject ourdemands precisely because they are better founded thananyone else’s would be tantamount to accepting the equation:+ × + = –; in other words, it would be to heap absurdity uponabsurdity.

Labor and Nature collaborate in varying proportions,depending upon the country and the climate, in the produc-tion of a commodity. The part that Nature contributes isalways free of charge; it is the part contributed by humanlabor that constitutes value and is paid for.

If an orange from Lisbon sells for half the price of anorange from Paris, it is because the natural heat of the sun,which is, of course, free of charge, does for the former whatthe latter owes to artificial heating, which necessarily has tobe paid for in the market.

Thus, when an orange reaches us from Portugal, one cansay that it is given to us half free of charge, or, in other words,at half price as compared with those from Paris.

Now, it is precisely on the basis of its beingsemigratuitous (pardon the word) that you maintain it shouldbe barred. You ask: “How can French labor withstand thecompetition of foreign labor when the former has to do all thework, whereas the latter has to do only half, the sun takingcare of the rest?” But if the fact that a product is half free ofcharge leads you to exclude it from competition, how can itsbeing totally free of charge induce you to admit it into compe-tition? Either you are not consistent, or you should, afterexcluding what is half free of charge as harmful to ourdomestic industry, exclude what is totally gratuitous with allthe more reason and with twice the zeal.

To take another example: When a product—coal, iron,wheat, or textiles—comes to us from abroad, and when we canacquire it for less labor than if we produced it ourselves, the

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difference is a gratuitous gift that is conferred upon us. Thesize of this gift is proportionate to the extent of this difference.It is a quarter, a half, or three-quarters of the value of theproduct if the foreigner asks of us only three-quarters,one-half, or one-quarter as high a price. It is as complete as itcan be when the donor, like the sun in providing us with light,asks nothing from us. The question, and we pose it formally, iswhether what you desire for France is the benefit of consump-tion free of charge or the alleged advantages of onerousproduction. Make your choice, but be logical; for as long asyou ban, as you do, foreign coal, iron, wheat, and textiles, inproportion as their price approaches zero, how inconsistent itwould be to admit the light of the sun, whose price is zero allday long!

A Petition







A Chinese Tale

People bewail the greed and selfishness of our age!I, for my part, find the world, especially Paris, peopledwith Deciuses.1

Open the thousand books, the thousand newspapers, thethousand pamphlets, that the Parisian presses spew forthevery day over the country. Are they not all the work of littlesaints?

What animation in the painting of the vices of our day!What moving concern for the masses! With what liberality therich are invited to share with the poor, if not the poor with therich! What a host of plans for social reforms, social improve-ments, social organizations! Is there any hack scribbler who isnot devoting himself to the welfare of the toiling masses? Foran advance of a few crowns, he will find the opportunity toindulge himself in humanitarian lucubrations.

And yet people talk about the selfishness and individu-alism of our era!

There is nothing that does not pretend to serve thewell-being and the edification of the people—nothing, noteven the customhouse. You think, perhaps, that it is justanother instrument of taxation, like the license bureau or thetollhouse at the end of the bridge? Nothing of the kind. It isessentially an institution for the advancement of civilization,fraternity, and equality. What do you expect? To be in fashiontoday, one must show, or pretend to show, feeling, senti-

45


1. [The Deciuses referred to here were Publius Decius Mus, father and son,both military leaders of the Roman Republic between 350 and 275 B.C.Each is said to have performed an act of self-devotion by hurling himselfinto the enemy’s midst when the Roman column he was leading wasrepulsed by the foe.—Translator.]



mental sensibility, everywhere, even at the customhousewindow where they ask, “What do you have there, friend?”

But for realizing these humanitarian aspirations, thecustomhouse has, it must be confessed, some rather strangeprocedures.

It musters an army of directors, assistant directors, inspec-tors, deputy inspectors, superintendents, auditors, collectors,department heads, assistant department heads, clerks, super-numeraries, candidates for the jobs of supernumeraries, andcandidates for the candidacy, to say nothing of those on activeservice—all with the object of exercising over the productiveactivities of the people the negative action that can besummed up in the word bar.

Notice that I do not say tax, but quite genuinely bar.And to bar, not acts repugnant to morality or dangerous

to public order, but transactions that are innocent and, as isadmitted, conducive to peace and harmony among nations.

Nevertheless, mankind is so flexible and adaptable that inone way or another it always surmounts these barriers. It isjust a matter of applying more labor.

If people are barred from importing their food fromabroad, they produce it domestically. This is more laborious,but one must eat. If they are barred from passing through thevalley, they climb over the mountains. This way is longer, butone must reach one’s destination.

All this is regrettable, but it does have its ridiculous side.When the law has in this way created a certain number ofobstacles, and when, in order to overcome them, mankind hasdiverted a corresponding amount of labor from other employ-ments, you are no longer allowed to demand the reform of thelaw; for if you point out the obstacle, the jobs that it makes forare pointed out to you, and if you say, “These are not jobs thathave been created, but displaced, by the obstacle,” you areanswered in the words of L’Esprit public: “Only our impover-ishment is certain and immediate; as for our enrichment, thatis more than problematical.”

This reminds me of a Chinese story.Once upon a time there were, in China, two great cities:

Chin and Chan. They were connected by a magnificent canal.The emperor judged it desirable to have enormous blocks ofstone thrown into it, in order to put it out of service.

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Seeing this, Kuang, his chief mandarin, said to him:“Son of Heaven, you are making a mistake.”To which the emperor replied:“Kuang, you are talking like a fool.”(Of course I am reporting here only the gist of their conver-

sation.)After three moons had passed, the celestial emperor sent

for the mandarin and said to him:“Kuang, look yonder.”And Kuang opened his eyes and looked.And he saw, some distance from the canal, a multitude of

men at work. Some were excavating, others were raisingembankments, still others were leveling the ground, andothers laying paving stones; and the mandarin, who was verywell read, thought to himself: They are making a highway.

After three more moons had passed, the emperorsummoned Kuang and said to him:

“Look yonder.”And Kuang looked.And he saw that the highway was completed, and he

noticed that at different points all along the road, inns werebeing built. A host of pedestrians, carts, and palanquins werecoming and going; and innumerable Chinese, overcome withfatigue, were carrying heavy burdens from Chin to Chan andfrom Chan to Chin. And Kuang said to himself: “It was thedestruction of the canal that provided jobs for these poorpeople.” But it never occurred to him that their labor had beendiverted from other employments.

And three more moons passed by, and the emperor saidto Kuang:

“Look yonder.”And Kuang looked.And he saw that the inns were always full of travelers,

and, grouped around them, were the shops of butchers,bakers, and dealers in swallows’ nests, to feed the hungry trav-elers. And, inasmuch as these worthy artisans could not goabout naked, there had also settled among them tailors, shoe-makers, and dealers in parasols and fans; and since people donot sleep out in the open air, even in the Celestial Empire,there were also carpenters, masons, and roofers. Then there

47

A Chinese Tale




were police officials, judges, and fakirs; in brief, a city with itssuburbs had grown up around each inn.

And the emperor said to Kuang, “What do you think ofit?”

And Kuang replied: “I should never have thought that thedestruction of a canal could create jobs for so many people”;for it never occurred to him that these jobs had not beencreated, but displaced, and that the travelers used to eat justas well when they went along the canal as they did after theywere forced to use the highway.

However, to the great astonishment of the Chinese, theemperor died, and this Son of Heaven was laid to rest.

His successor sent for Kuang and said: “Have the canalopened up.”

And Kuang said to the new emperor:“Son of Heaven, you are making a mistake.”And the emperor answered:“Kuang, you are talking like a fool.”But Kuang persisted and said, “Sire, what do you have in

mind?”“I have in mind,” the emperor said, “facilitating the move-

ment of men and things between Chin and Chan by makingtransportation less expensive, so that the people may have teaand clothing at lower cost.”

But Kuang was all prepared. The evening before, he hadreceived several issues of the Moniteur industriel, a Chinesenewspaper. Knowing his lesson well, he asked permission toreply; after obtaining it, he prostrated himself nine times andsaid:

“Sire, by facilitating transporation, you hope to reduce theprice of consumers’ goods, in order to put them within reachof the people, and to this end, you begin by making them loseall the jobs that the destruction of the canal gave rise to. Sire,in political economy, low prices…”

The emperor: “You seem to be reciting this frommemory.”

Kuang: “You are right; it will be more convenient for meto read it to you.”

And, after unfolding L’Esprit public, he read:In political economy, low prices for consumers’ goods are

of only secondary importance. The real problem consists in

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establishing an equilibrium between the price of labor andthat of the means of subsistence. The wealth of a nationconsists in the amount of employment it provides its laborforce, and the best economic system is that which provides thegreatest possible number of jobs. The question is not whetherit is better to pay four cash or eight cash for a cup of tea, fivetaels or ten taels for a shirt. These are childish considerationsunworthy of a mature mind. No one disputes your thesis. Theproblem is whether it is better to have to pay more for acommodity, but to have, thanks to the abundance of jobs andthe higher price of labor, more means of acquiring it; orwhether it is better to limit the number of job opportunities,reduce the total quantity of domestic production, and trans-port consumers’ goods by water, doubtless at lower cost, butat the same time denying some of our workers the possibilityof buying them even at these reduced prices.

Since the emperor was still not entirely convinced, Kuangsaid to him: “Sire, deign to wait. I still have the Moniteurindustriel to read to you.”

But the emperor said:“I do not need your Chinese newspapers to know that to

create obstacles is to divert and displace labor. But that is notmy mission. Go out there and clear the obstacles from thecanal. After that, we’ll reform the tariff.”

And Kuang went off, tearing at his beard and lamenting:“O Fô! O Pê! O Lî! and all other monosyllabic, circumflectedgods of Cathay, take pity on your people; for there has come tous an emperor of the English school, and I can see that beforelong we shall be in want of everything, since we shall no longerneed to do anything.”

A Chinese Tale







Something else

“What is restriction?”“It is a partial interdiction.”“What is interdiction?”“It is an absolute restriction.”“So that what is true of the one is true of the other?”“Yes; the difference is only one of degree. The relation

between them is the same as that between the arc of a circleand the circle itself.”

“Therefore, if interdiction is bad, restriction cannot begood?”

“No more than the arc of a circle can be anything butcircular.”

“What is the generic name for both restriction and inter-diction?”

“Protectionism.”“What is the ultimate effect of protectionism?”“To require that men expend more labor for the same

result.”“Why are men so attached to the protectionist system?”“Because, as free trade enables them to attain the same

result with less labor, this apparent diminution of labor terri-fies them.”

“Why do you say apparent?”“Because all the labor that has been saved can be devoted

to something else.”“What else?”“That is what cannot be specified and does not need to

be.”“Why?”

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“Because, if the total quantity of consumers’ goodsenjoyed by the French people could be obtained withone-tenth less labor, no one can predict what new satisfac-tions they would try to obtain for themselves with theremaining available labor. One person would want to bebetter clothed; another, better fed; this one, better educated;that one, better entertained.”

“Explain to me the functioning and the effects of protec-tionism.”

“That is not so easy. Before considering the more compli-cated cases, one should study the simpler ones.”

“Take the simplest case you wish.”“You remember how Robinson Crusoe managed to make

a board when he had no saw?”1

“Yes. He cut down a tree; then, by trimming the trunk,first on one side and then on the other, with his axe, hereduced it to the thickness of a plank.”

“And that cost him a great deal of labor?”“Two full weeks.”“And what did he live on during that time?”“On his provisions.”“And what happened to the axe?”“It became very dull as a result.”“Quite right. But perhaps you do not know this: just as he

was about to strike the first blow with his axe, RobinsonCrusoe noticed a plank cast up on the beach by the waves.”

“Oh, what a lucky accident! He ran to pick it up?”“That was his first impulse; but then he stopped and

reasoned as follows:“ ‘If I go to get that plank, it will cost me only the exertion

of carrying it, and the time needed to go down to the beachand climb back up the cliff.

“ ‘But if I make a plank with my axe, first of all, I shall beassuring myself two weeks’ labor; then, my axe will becomedull, which will provide me with the job of sharpening it; and Ishall consume my provisions, making a third source of

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1. [What follows is based on Robinson Crusoe, the famous novel by theEnglish author, Daniel Defoe (1659-1731). A number of students ofeconomics, including Bastiat, have used what has been called the“Crusoeist” approach to economic problems by starting with the simplestpossible economic organization.—Translator.]



employment, since I shall have to replace them. Now, labor iswealth. It is clear that I shall only be hurting my own interestsif I go down to the beach to pick up that piece of driftwood. Itis vital for me to protect my personal labor, and, now that Ithink of it, I can even create additional labor for myself bygoing down and kicking that plank right back into the sea!’ ”

“What an absurd line of reasoning!”“That may be. It is nonetheless the same line of reasoning

that is adopted by every nation that protects itself by inter-dicting the entry of foreign goods. It kicks back the plank thatis offered it in exchange for a little labor, in order to give itselfmore labor. There is no labor, even including that of thecustoms official, in which it does not see some profit. It isrepresented by the pains Robinson Crusoe took to return tothe sea the present it was offering him. Consider the nation asa collective entity, and you will not find an iota of differencebetween its line of reasoning and that of Robinson Crusoe.”

“Did he not see that he could devote the time he couldhave saved to making something else?”

“What else?”“As long as a person has wants to satisfy and time at his

disposal, he always has something to do. I am not obliged tospecify the kind of work he could undertake to do.”

“I can certainly specify precisely the kind that probablyescaped his attention.”

“And I maintain, for my part, that, with incredible blind-ness, he confused labor with its result, the end with themeans, and I am going to prove it to you…”

“You do not have to. The fact still remains that this is anillustration of the system of restriction or interdiction in itssimplest form. If it seems absurd to you in this form, it isbecause the two functions of producer and consumer are herecombined in the same individual.”

“Let us therefore proceed to a more complicated case.”“Gladly. Some time later, after Robinson had met Friday,

they pooled their resources and began to co-operate incommon enterprises. In the morning, they hunted for sixhours and brought back four baskets of game. In the evening,they worked in the garden for six hours and obtained fourbaskets of vegetables.

53

Something else




“One day a longboat landed on the Isle of Despair. A hand-some foreigner2 disembarked and was admitted to the table ofour two recluses. He tasted and highly praised the products ofthe garden, and, before taking leave of his hosts, he addressedthem in these words:

“ ‘Generous islanders, I dwell in a land where game ismuch more plentiful than it is here, but where horticulture isunknown. It will be easy for me to bring you four baskets ofgame every evening, if you will give me in exchange only twobaskets of vegetables.’

“At these words, Robinson and Friday withdrew to confer,and the debate they had is too interesting for me not to reportit here in full.

“Friday: Friend, what do you think of it?“Robinson: If we accept, we are ruined.“F.: Are you quite sure of that? Let us reckon up what it

comes to.“R.: It has all been reckoned up, and there can be no

doubt about the outcome. This competition will simply meanthe end of our hunting industry.

“F.: What difference does that make if we have the game?“R.: You are just theorizing! It will no longer be the

product of our labor.“F.: No matter, since in order to get it we shall have to part

with some vegetables!“R.: Then what shall we gain?“F.: The four baskets of game cost us six hours of labor.

The foreigner gives them to us in exchange for two baskets ofvegetables, which take us only three hours to produce. There-fore, this puts three hours at our disposal.

“R.: You ought rather to say that they are subtracted fromour productive activity. That is the exact amount of our loss.Labor is wealth, and if we lose one-fourth of our workingtime, we shall be one-fourth less wealthy.

“F.: Friend, you are making an enormous mistake. Weshall have the same amount of game, the same quantity of

54



2. 93. [There is a nuance of meaning here in the French that cannot bereproduced in English. The French word étranger means both ”foreigner"and “stranger.” Bastiat’s point, as is evident in what follows, is, not that thevisitor was just a stranger, but that he was a foreigner in the sense of beingexternal to Robinson’s and Friday’s economic system.—Translator.]



vegetables, and—into the bargain—three more hours at ourdisposal. That is what I call progress, or there is no such thingin this world.

“R.: You are talking in generalities! What shall we do withthese three hours?

“F.: We shall do something else.“R.: Ah! I have you there. You are unable to mention

anything in particular. Something else, something else—thatis very easy to say.

“F.: We can fish; we can decorate our cabin; we can readthe Bible.

“R.: Utopia! Who knows which of these things we shall do,or whether we shall do any of them?

“F.: Well, if we have no wants to satisfy, we shall take arest. Is not rest good for something?

“R.: But when people lie around doing nothing, they die ofhunger.

“F.: My friend, you are caught in a vicious circle. I amtalking about a kind of rest that will subtract nothing from oursupply of game and vegetables. You keep forgetting that bymeans of our foreign trade, nine hours of labor will provide uswith as much food as twelve do today.

“R.: It is very clear that you were not brought up inEurope. Had you ever read the Moniteur industriel, it wouldhave taught you this: ‘All time saved is a dead loss. Whatcounts is not consumption, but production. All that weconsume, if it is not the direct product of our labor, counts fornothing. Do you want to know whether you are rich? Do notmeasure the extent of your satisfactions, but of your exertion.’This is what the Moniteur industriel would have taught you.As for myself, being no theorist, all I see is the loss of ourhunting.

“F.: What an extraordinary inversion of ideas! But…“R.: But me no buts. Moreover, there are political reasons

for rejecting the selfish offers of the perfidious foreigner.“F.: Political reasons!“R.: Yes. First, he is making us these offers only because

they are advantageous to him.“F.: So much the better, since they are so for us too.“R.: Then, by this traffic, we shall make ourselves

dependent upon him.

55

Something else




“F.: And he will make himself dependent on us. We shallhave need of his game; and he, of our vegetables; and we shallall live in great friendship.

“R.: You are just following some abstract system! Do youwant me to shut you up for good?

“F.: Go on and try. I am still waiting for a good reason.“R.: Suppose the foreigner learns to cultivate a garden,

and that his island is more fertile than ours. Do you see theconsequence?

“F.: Yes. Our relations with the foreigner will be severed.He will no longer take our vegetables, since he will have themat home with less labor. He will no longer bring us game, sincewe shall have nothing to give him in exchange, and we shallthen be in precisely the same situation that you want us to bein today.

“R.: Improvident savage! You do not see that afterdestroying our hunting industry by flooding us with game, hewill destroy our gardening industry by flooding us with vegeta-bles.

“F.: But this will happen only so long as we shall be in aposition to give him something else, that is to say, so long aswe shall be able to find something else to produce with asaving in labor for ourselves.

“R.: Something else, something else! You always comeback to that. You are up in the clouds, my friend; there isnothing practical in your ideas.

“The dispute went on for a long time and left each one, asoften happens, unchanged in his convictions. However, sinceRobinson had great influence over Friday, he made his viewprevail; and when the foreigner came to learn how his offerhad been received, Robinson said to him:

“ ‘Foreigner, in order for us to accept your proposal, wemust be very sure about two things:

“ ‘First, that game is not more plentiful on your islandthan on ours; for we want to fight only on equal terms.

“ ‘Second, that you will lose by this bargain. For, as inevery exchange there is necessarily a gainer and a loser, weshould be victimized if you were not the loser. What do yousay?’

“ ‘Nothing,’ said the foreigner. And, bursting intolaughter, he re-embarked in his longboat.”

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“The story would not be so bad if Robinson were not soabsurd.”

“He is no more so than the committee of the rueHauteville.”3

“Oh, their case is very different. In the hypothetical casesyou cited, first, one man was living by himself, and then (whatamounts to the same thing), two men were living in a state ofcommon ownership. That is far from being the picturepresented by the world in which we are living today; the divi-sion of labor and the intervention of tradesmen and moneychange the picture considerably.”

“These conditions do, in fact, make transactions morecomplicated, but they do not change their essential nature.”

“What! You want to compare modern commerce tosimple barter?”

“Commerce is nothing but barter on a grand scale; barterand commerce are essentially identical in nature, just as laboron a small scale is of essentially the same nature as labor on alarge scale, or as the force of gravitation that moves an atom isof essentially the same nature as the force of gravitation thatmoves a planet.”

“Then, as you see it, these arguments, which are so clearlyuntenable when advanced by Robinson Crusoe, are no less sowhen advanced by our protectionists?”

“No less; the only reason the error is less evident is thatthe circumstances are more complicated.”

“In that case, why not give us an example taken fromconditions as they are at present?”

“Very well. In France, owing to custom and the demandsof the climate, cloth is a useful item. Is the essential thing tomake it or to have it?”

“A fine question! In order to have it, you must first makeit.”

“Not necessarily. In order to have it, someone must makeit, no doubt; but it is not necessary that the person or thecountry that consumes it should also produce it. You did not

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Something else


3. [The Committee for the Defense of Domestic Industry, a protectionistorganization of which Antoine Odier (1766-1853), President of theChamber of Commerce of Paris, a Deputy, and later a Peer of France, wasone of the leaders.—Translator.]



make the fabric that clothes you so well, nor did Franceproduce the coffee on which her inhabitants breakfast.”

“But I bought my cloth, and France its coffee.”“Precisely, and with what?”“With money.”“But you did not produce the metal for your money, nor

did France either.”“We bought it.”“With what?”“With the products we sent to Peru.”“Thus, in reality, it is your labor that is exchanged for

cloth, and French labor that is exchanged for coffee.”“Undoubtedly.”“Hence, it is not absolutely necessary that you produce

what you consume?”“Not if we produce something else that we give in

exchange.”“In other words, France has two ways of providing itself

with a given quantity of cloth. The first is to manufacture itherself; the second is to make something else, and toexchange that something else with foreigners for cloth. Ofthese two ways, which is the better?”

“I hardly know.”“Is it not that which, for a given amount of labor, yields a

larger amount of cloth?”“It would seem so.”“And which is better for a nation, to be free to choose

between these two ways of getting cloth, or to have a law inter-dicting one of them, on the chance of stumbling on the betterof the two?”

“It seems to me that it is better for a nation to be free tochoose, all the more so since in such matters it always chooseswisely.”

“The law that bans foreign cloth thus determines that ifFrance wants to have cloth, she must make it herself, andprohibits her from making that something else with which shecould buy foreign cloth.”

“True.”“And since the law compels the making of cloth and

forbids the making of something else, precisely because thatsomething else would require less labor (for otherwise there

58





would be no need for the law to interfere), it thus virtuallydecrees that for a given quantity of labor France shall have butone meter of cloth by making it herself, whereas for the sameamount of labor she would have had two meters by makingsomething else.”

“But what else, for goodness’ sake?”“For goodness’ sake, what difference does it make? Once

given freedom of choice, she will make something else only inso far as there is something else to be made.”

“That is possible; but I keep being haunted by the ideathat foreigners may send us cloth and not take the somethingelse from us in return, in which case we should be thoroughlyvictimized. In any case, this is the objection, even from yourpoint of view. You do agree, do you not, that France will makethis something else to exchange for cloth with less labor thanif she had made the cloth itself?”

“Without a doubt.”“Therefore, there will be a certain quantity of her avail-

able labor supply that will be disemployed.”“Yes, but without her being any the less well clothed—a

little circumstance that makes all the difference in the world.It was this that Robinson lost sight of, and that our protection-ists either do not see or pretend not to see. The piece of drift-wood also disemployed Robinson’s labor for two weeks, atleast in so far as it might have been applied to making a plank,but it did not deprive him of its use. We must, therefore, distin-guish between two senses in which labor may be disemployed:that in which the effect is privation, and that in which thecause is satisfaction. They are worlds apart, and if you regardthem as alike, your reasoning is no better than Robinson’s. Inthe most complicated cases, as well as in the simplest, thesophism consists in judging the utility of labor by its dura-tion and intensity, and not by its results; which leads to theeconomic policy of reducing the results of labor with the aimof increasing its duration and intensity.”

Something else







Table of Contents

Introduction — 7

What Is Seen andWhat Is Not Seen — 11

Abundance and Scarcity — 29

A Petition — 39

A Chinese Tale — 45

Something else — 51




Documents

FREDERIC BASTIAT, Defender of Sound Economics · 2006. 9. 20. · Cercle Bastiat of France for providing the Bastiat portrait used in this booklet. We also want to thank the Foundation