This week, Ron and Ed profiled Frédéric Bastiat, a French economist and author who was a prominent member of the French Liberal School. He introduced the Parable of the Broken Window. He was also a Freemason, and member of the French National Assembly.
As a strong advocate of classical liberalism and the economics of Adam Smith, his views favoring free trade and opposing protectionism provided a basis for libertarian capitalism and the Austrian School.
The focus of our conversation will be around the works published in the free eBook entitled, The Essential Bastiat, published by the Foundation for Economic Education. Click on the link to get your copy.
“Frédéric Bastiat was the most brilliant economic journalist who ever lived.” –Joseph Schumpeter (1954)
Bastiat was an indefatigable advocate free trade, laissez-faire policies, unrelenting debater and statesman. He’s often compared to Voltaire and Benjamin Franklin, integrity, purity, and elegance.
He was unrivaled in exposing fallacies, using reductio ad absurdum.
He attacked statism of all kinds—socialism, communism, utopianism, and mercantilism, labor theory of value, exploitation theories.
Biography
Born June 29, 1801 in Bayonne, the south of France and tragically died young on December 24, 1850. He had poor health and weak lungs his whole life.
Son of a landowner and merchant in Spanish trade. His mother died when he was seven, father when he was nine, raised by his aunt and grandfather. Strong believer in the Catholic faith.
Heavily influenced by Jean-Baptise Say and Adam Smith.
In 1846, he moved to Paris, writing on free trade and in 1848 the peasants in France rebelled against the French monarchy, and their rallying cry was socialism.
Bastiat wrote of the rebellion: “We have tried so many things; when shall we try the simplest of all: freedom?”
He elected to the National Assembly in 1848, and was vice president of the finance committee. He sat on the left side, where the liberals and radicals sat.
Henry Hazlitt (1894-1993), author of Economics in One Lesson, 1946, has often been called a modern-day Bastiat. We will profile Hazlitt in a future Memorable Mentors show.
In 1843 Karl Marx moved to Paris to become editor of a monthly German magazine. He met Friedrich Engels in Paris, who became his life long collaborator.
Marx labeled Bastiat: the most “superficial apologist of the vulgar economy.”
We discussed the five essays included in the free FEE book, mentioned in the introduction above. Here are some excerpts.
The Youth of France
Are men’s interests, when left to themselves, harmonious or antagonistic?
Socialists love for society they dreamed up; actual society cannot be destroyed soon enough.
Socialism, like astrology and alchemy, proceeds by way of imagination.
Political economy, like astronomy and chemistry, proceeds by way of observation.
Deny evil! Deny pain! Who could? We are talking about mankind.
For the laws of Providence to be harmonious, it’s not necessary they exclude evil.
Since man is free, he can choose; since he can choose, he can err; since he can err, he can suffer.
What are the things men have right to impose upon another by force? I know of only one, and that’s justice.
What Is Seen and What Is Not Seen
The difference between good and bad economist, whole difference: the bad one takes account of the visible effect; the good takes account both of the effects which are seen, and also those which are necessary to foresee.
It almost always happens when immediate consequence is favorable, the ultimate consequences are fatal, and the converse.
We learn this lesson from two masters: experience and foresight. Experience teaches effectually, but brutally.
The Parable of the Broken Window
Society loses the value of things which are uselessly destroyed.
How much trade would gain by the burning of Paris?
If the nation profits from the Army, then we should enroll the entire male population.
If we disapprove of State support, we are supposed to disapprove of the thing itself, like the arts, education, health, environment, public works, etc.
Section VIII. Machinery
A curse on machines, is to curse the spirit of humanity!
If true, there is no activity, prosperity, wealth, or happiness possible for any people, except those who are stupid and inert, and to whom God has not granted the fatal gift of knowing how to think, to combine, invent.
All men seek to obtain the greatest amount of gratification with the smallest possible amount of labor.
If a machine discharges a workman: the seen is there’s an unemployed worker but there’s also a capitalist with an unemployed franc.
What is saved by one, profits all.
A Petition
Probably Bastiat’s most famous writing: “A Petition: From the Manufacturers of Candles, Tapers, Lanterns, sticks, Street Lamps, Snuffers, and Extinguishers, and from Producers of Tallow, Oil, Resin, Alcohol, and Generally of Everything Connected with Lighting.”
We are suffering from unfair competition at a fantastically low price: the sun.
Please pass a law ordering the closing of all windows, skylights, shutters, curtains, and blinds.
A Negative Railroad
Should there be a break in the tracks at Bordeaux on hte railroad from Paris to Spain? It would be profitable for boatmen, porters, hotels, taverns, etc.
Then we shall end by having a railroad composed of a whole series of breaks in the tracks, i.e., a negative railroad.
The Law
Life, liberty, and property do not exist because men have made laws. On the contrary, it was the fact that life, liberty, and property existed beforehand that caused men to make laws in the first place.
Law has been perverted by the influence of two different causes: stupid greed and false philanthropy.
Labor is pain, so history shows man will resort to plunder.
Look at the USA [1850]. There’s no country in the world where the law is kept more within its proper domain: the protection of every person’s liberty and property.
But, there are two issues that have always endangered the public peace.
Slavery is a violation, by law, of liberty. Tariff, by law, of property.
Socialists rely on the law; they practice legal plunder, not illegal plunder.
Other Bastiat Wit
If exports are good, and imports are bad, then we should sink the ships at sea.
The Right Hand and the Left (a Report to the King). This is one of Ron’s favorite of Bastiat, and we believe it applies to hourly billing (see Ron’s article from a Harcourt Brace Newsletter, from October 1997, posted on the VeraSage site). Here is the crux of the argument.
Deep study of the protectionist system has revealed to us this syllogism:
The more one works, the richer one is.
The more difficulties one has to overcome, the more one works.
Ergo, the more difficulties one has to overcome, the richer one is.
We propose that you forbid your loyal subjects to use their right hands.
No longer permissible to work except with the foot. As a last resort, we should take recourse to the limitless possibilities of amputation.
George Orwell wrote, “Each joke is a tiny revolution.”
Bastiat killed protectionism and socialism with ridicule.
Consumption is the end of all economic activity, production merely the means.
To sacrifice the consumer’s interest to that of the producer is the sacrifice of the end to the means. The interest of the consumer is identical to mankind.
People insist, it’s not enough to tear down; you must offer something constructive. I, for my part, think that to tear down an error is to build up the truth that stands opposed to it.
No solitary man would break his own tools to occupy his labor.
To maintain that the time will every come when human labor will lack employment, it would be necessary to prove that mankind will cease to encounter obstacles.
Only two ways to preserve life: production or plunder.
Other resources
Bastiat published two major works: Economic Harmonies and The Law, a pamphlet June 1850.
Also, Economic Sophisms, is an excellent compilation of some of Bastiat’s writings, with an Introduction by Henry Hazlitt.
Southwest Ad that ran after Wright Amendment repealed
Libertas book, The Tuttle Twins Learn About the Law
