The Economics of Freedom: What Your Professors Won't Tell You, Selected Works of Frederic Bastiat Page 12

to buy personal satisfactions he uses to buy pieces of land, a house, government bonds, industrial enterprises; or perhaps he invests it with a broker or a banker. Follow the money through all these hypothetical uses, and you will be convinced that, through the intermediary of sellers or borrowers, it will go to support industry just as surely as if Ariste, following the example of his brother, had exchanged it for furniture, jewels, and horses.

  For when Ariste buys for ten thousand francs pieces of land or bonds, he does so because he feels he does not need to spend this sum. This seems to be what you hold against him.

  But, by the same token, the person who sells the piece of land or the mortgage is going to have to spend in some way the ten thousand francs he receives.

  So that the spending is done in either case, whether by Ariste or by those who are substituted for him.

  From the point of view of the working class and of the support given to industry, there is, then, only one difference between the conduct of Ariste and that of Mondor. The spending of Mondor is directly accomplished by him and around him; it is seen. That of Ariste, being carried out partly by intermediaries and at a distance, is not seen. But in fact, for anyone who can connect effects to their causes, that which is not seen is every bit as real as that which is seen. What proves it is that in both cases the money circulates, and that no more of it remains in the coffers of the wise brother than in those of the prodigal.

  It is therefore false to say that thrift does actual harm to industry. In this respect it is just as beneficial as luxury.

  But how superior it appears, if our thinking, instead of confining itself to the passing hour, embraces a long period of time!

  Ten years have gone by. What has become of Mondor and his fortune and his great popularity? It has all vanished. Mondor is ruined; far from pouring fifty thousands francs into the economy every year, he is probably a public charge. In any case he is no longer the joy of the shopkeepers; he is no longer considered a promoter of the arts and of industry; he is no longer any good to the workers, nor to his descendants, whom he leaves in distress.

  At the end of the same ten years Ariste not only continues to put all of his income into circulation, but he contributes increasing income from year to year. He adds to the national capital, that is to say, the funds that provide wages; and since the demand for workers depends on the extent of these funds, he contributes to the progressive increase of remuneration of the working class. Should he die, he will leave children who will replace him in this work of progress and civilization.

  Morally, the superiority of thrift over luxury is incontestable. It is consoling to think that, from the economic point of view, it has the same superiority for whoever, not stopping at the immediate effects of things, can push his investigations to their ultimate effects.

 

  12. The Right to Employment and the Right to Profit

 

  “Brothers, assess yourselves to furnish me work at your price.” This is the right to employment, elementary or first-degree socialism.

  “Brothers, assess yourselves to furnish me work at my price.” This is the right to profit, refined or second-degree socialism.

  Both live by virtue of such of their effects as are seen. They will die from those of their effects that are not seen.

  What is seen is the work and the profit stimulated by the assessments levied on society. What is not seen is the work and the profits that would come from this same amount of money if it were left in the hands of the taxpayers themselves.

  In 1848 the right to employment showed itself for a moment with two faces. That was enough to ruin it in public opinion.

  One of these faces was called: National workshop.

  The other: Forty-five centimes.

  Millions went everyday from the rue de Rivoli to the national workshops. This was the beautiful side of the coin.

  But here is what was on the other side. In order for millions of francs to come out of a coffer, they must first have come into it. That is why the organizers of the right to employment addressed themselves to the taxpayers.

  Now, the farmers said: “I must pay forty-five centimes. Then I shall be deprived of clothes; I cannot marl my field; I cannot have my house repaired.”

  And the hired hands said: “Since our boss is not going to have any new clothes, there will be less work for the tailor; since he is not going to have his field marled, there will be less work for the ditchdigger; since he is not going to have his house repaired, there will be less work for the carpenter and the mason.”

  It was therefore proved that you cannot profit twice from the same transaction, and that the work paid for by the government was created at the expense of work that would have been paid for by the taxpayer. That was the end of the right to employment, which came to be seen as an illusion as well as an injustice.

  However, the right to profit, which is nothing but an exaggeration of the right to employment, is still alive and flourishing.

  Is there not something shameful in the role that the protectionist makes society play?

  He says to society:

  “You must give me work, and, what is more, lucrative work. I have foolishly chosen an industry that leaves me with a loss of ten percent. If you slap a tax of twenty francs on my fellow citizens and excuse me from paying it, my loss will be converted into a profit. Now, profit is a right; you owe it to me.”

  The society that listens to this sophist, that will levy taxes on itself to satisfy him, that does not perceive that the loss wiped out in one industry is no less a loss because others are forced to shoulder it—this society, I say, deserves the burden placed upon it.

  Thus, we see, from the many subjects I have dealt with, that not to know political economy is to allow oneself to be dazzled by the immediate effect of a phenomenon; to know political economy is to take into account the sum total of all effects, both immediate and future.

  I could submit here a host of other questions to the same test. But I desist from doing so, because of the monotony of demonstrations that would always be the same, and I conclude by applying to political economy what Chateaubriand said of history:

 

  There are two consequences in history: one immediate and instantaneously recognized; the other distant and unperceived at first. These consequences often contradict each other; the former come from our short-run wisdom, the latter from long-run wisdom. The providential event appears after the human event. Behind men rises God. Deny as much as you wish the Supreme Wisdom, do not believe in its action, dispute over words, call what the common man calls Providence “the force of circumstances” or “reason”; but look at the end of an accomplished fact, and you will see that it has always produced the opposite of what was expected when it has not been founded from the first on morality and justice.

  (Chateaubriand, Memoirs from beyond the Tomb.)

  A Petition

  From the Manufacturers of Candles, Tapers, Lanterns, Candlesticks, Street Lamps, Snuffers, and Extinguishers, and from the Producers of Tallow, Oil, Resin, Alcohol, and Generally of Everything Connected with 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. You concern yourselves mainly with the fate of the producer. You wish to free him from foreign competition, that is, to reserve the domestic market for domestic industry.

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

  We are suffering from the ruinous competition of a foreign rival who
apparently works under conditions so far superior to our own for the production of light that he is flooding the domestic market with it at an incredibly low price; for the moment he appears, our sales cease, all the consumers turn to him, and a branch of French industry whose ramifications are innumerable is all at once reduced to complete stagnation. This rival, which is none other than the sun, is waging war on us so mercilessly that we suspect he is being stirred up against us by perfidious Albion (excellent diplomacy nowadays!), particularly because he has for that haughty island a respect that he does not show for us.

  We ask you to be so good as to pass a law requiring the closing of all windows, dormers, skylights, inside and outside shutters, curtains, casements, bull's-eyes, deadlights, and blinds—in short, all openings, holes, chinks, and fissures through which the light of the sun is wont to enter houses, to the detriment of the fair industries with which, we are proud to say, we have endowed the country, a country that cannot, without betraying ingratitude, abandon us today to so unequal a combat.

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

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

  If France consumes