Wednesday, December 2, 2015

Bastiat and Political Economy 1852

Bastiat and his Works, article in The Economist 1852

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FRANCE lost in M Frederick Bastiat a most useful citizen, and the world an acute philosopher. His career was, however, short. It began as a pablic man 1845, and terminated in 1851; but from the day when he took up his pen in the cause of Free Trade it knew no repose. "Modest and studious by nature, he then became devouringly active; he scattered his truths abroad with both hands, and laboured as if he foresaw he should want time to distribute the treasure he had amassed by twenty years' silent study." Besides the works a list of which will be found below, be published in those five years about a hundred articles in the Journal des Economistes and in the Journal du Libre Echange, which he edited; he gave a gratuitous coarse of lectures, carried on a voluminous correspondence, entered into controversies in the public journals, and combated Proudhon, even in the Voix du Peuple. The revolution of 1848 carried him into the legislature, but there he spoke little. He made notes and wrote out heads of speeches on some of the most important subjects discussed, and though he joined no party he was honoured for the inflexible reason of what he did say. At the close of the summer of 1850 his protracted illness assumed a fatal character, and as a last hope he was ordered to Italy, where he died in the autumn of 1851.

A short time after M. Bastiat's death, a few of his friends, in order to do honour to his memory, resolved to acquire the copyright of his works and publish them in a cheap form. The means were speedily collected by subscription, and the works thus published, having recently reached us, induces us now to say a few words of the distinguishing characteristics of his writings.

Most of them were dictated by circumstances, and, like articles generally of newspapers or pamphlets of the moment, contain an abundance of extra scientific remarks. The most strictly scientific
and the largest or his works are his Sophismes Economiques, well known in England both in its native form and in Mr Porter's excellent translation; and his Harmonies Economiques. All his
writings are much more remarkable for the terse logic of his style, the felicity of his illustrations, the completeness of his demonstrations, than for any new principles he taught. He made no pretensions, except in his Harmonies Economiques, to establish or propound a system. His success was more doe to his great skill in expounding than in discovering truth; and his great merit lay
rather in his mode of treating what was known than in searching after the hidden. He is not so much distinguished from other political economists by his principles as by his lively yet vigorous
style. At the same time be holds himself up, or his friends now hold him up, as distinct from the English school. Like Sismondi,he aspires to carry the science from the domain of the material into that of the moral world. He deals with facts abstractedly, and is always more logical than statistical. "Wealth," says the preliminary notice of Messrs Prosper Paillottet and Roger de Fortenay to his Harmonies, "was for him only a form, an incident; the reality, the substance was the utility, the well-being, the development of man, intellectual and moral." Though adopting the doctrine that commodities pay for commodities, he did not rest at the visible productions, but went farther, and laid down the principle more general and more immaterial, that services are exchanged for services. The exchange is with him between men more than of goods. He made political economy more a science of man than of what man produces. He considered it more from the consumption than the production point of view-more as the wants of individuals were gratified than as the revenues of Governments were increased. He had to combat against Protection in every form
against restrictions on every productive art-to combat Socialism and Communism, the natural growth of Protection and restrictions; and he was much more intent on defending the rights
of individuals than on expounding the principles or taxation. He considered justice more than expediency, and, not stopping short at existing facts or existing systems, he went back to the principles of man's existence and the laws of Nature.

In the chapter "Moteur Social" of his Harmonies he says explaining both the impelling and the guiding or restraining power provided by Nature:-"The motive power is that innate irresistible impulse which incites us all to flee from evil and seek good. It is called the instinct of conservation, personal or private interest. But it is not enough that man is irresistibly impelled prefer good to evil, he requires to perceive it. For this end the Almiqhty has provided him with that marvellous and complex instrument called intelligence. To fix attention, compare, judge, reason, connect effect and causes, remember, and foresee, are the wheels of this admirable contrivance." Thus the science concerns, in his view, the intellect as well as the hand, knowledge as well as labour; and well does he demonstrate that the appetites and the wants, the impulses and the passions, carry forward society, while the intellect controls and guides it, and discovers, or rather records the means, when once discovered, by which evil is avoided and good attained.

On this principle M. Bastiat was a strenuous and powerful opponent of making classical learning the legal test of university and other literary honours, and of making it the basis of education.
In his little tract, Baccalaureat, he has shown, by a larger induction of instances, bringing together more facts than in any other of his productions, how very pernicious has been the effect
on the intellect and happiness of France, of the extreme study of the writings of the Romans and the Greeks. Speaking sneeringly of M. Thiers and a party zealous for the classics, M. Bastiat says: "To know what is, this is the evil. To impregnate oneself with Roman facts is morality. M. Thiers is not the first nor the only person who has succumbed to this illusion, I may say this mystification." To know what is, according to M. Bastiat, is the the wisdom, the sole means of properly guiding life; and filling the mind with a knowledge of what was, deadening the senses to
what is, and shutting out a knowledge of it, M. Bastiat demonstrates - going, we admit, ont of the ordinary bounds of political economy-was a source of the terrible ignorance and vast social
misery for which France has been more than half a century remarkable.

From his doctrine of services be is led to differ from Mr Ricardo, Mr M'Culloch, and other English economists, who have described rent as "the sum paid for the use of the natural and inherent
powers of the soil." M. Bastiat-alarmed by this doctrine being logically acted on by the Socialists, who denied a property in the gratuitous services of nature, and therefore attacked property in
land, and therefore might, according to him, attack all property whatever, for the cloth manufacturer, the founder, the carpenter, the navigator, like the agriculturists, use the powers of nature - disputed its accuracy, and taught that rent paid as the price of food is only the reward of the service of the agriculturist, as the price of cloth or iron is the reward of the weaver or the founder. Such a conclusion (little more in truth than a repetition of his great definition that services always pay for services, and there is no other means of payment,) arises spontaneously in a Frenchman. It was common to M. Say with M. Bastiat. In France the land is parcelled out into little plots, and the wretched agriculturists, aided by all the inherent powers of the soil, scarcely obtain a bare and miserable subsistence. Such a conclusion will with difficulty be arrived at in England, where the land remains in a few hands, and where the present race of landlords (without, as landlords, rendering any services to other men) are persons of great fortunes. In France the great majority of the owners of the soil are only paid for the food they supply to others. The differences between rent in France and rent in England are so great that they cannot be reduced to a common principle. Rent in Englaud does not fall within M. Bastiat's principle-the very foundation of all his arguments- "that services are exchanged for services." In past times at least, whatever rent is now becoming or may become, it was much more like the taxes men are compelled to pay, whether they like or want the services of rulers paid for or not, than like those voluntary exchanges which alone are considered in political economy-which spring from division of labour, and are essential to its existence and continuance. A part of rent in this country is the reward of services; but as long as the Corn Law existed a part of rent was as much a tax as is part of the price of a pound of tea or a newspaper. That part lies as much beyond the domain of M. Bastiat's principle-services exchange for services -as does the Turkish system of taxation.

Another point on which M. Bastiat differs from most of our living economists, and from almost all practical politicians, is the narrow functions which be is led by the condition of France to
ascribe to the State. Wherever verbal reasoning much predominates over the observance of facts, as in education on the Continent, the philosophical theory of nominalism prevails, and public
writers as well as the populace ascribe to general terms properties and qualities not possessed by any or all the species or individuals for which the general name stands. "It is the deplorable
habit," he says, "of our age to give a life to mere abstractions to imagine a city apart from the citizens, a humanity different from men, a collective besides all the parts that compose it."
Both in his "Harmonies" and his little work "L'Etat," he takes pains to show that the State has no powers and no rights but those belonging to the individuals composing it, and that consequently
nothing is or can be more absurd than the multifarious demands which are made, by all parties and classes in France, for the State to exert powers and perform services for the people, as if it were endowed with God-like virtues, and could confer benefit on all by taking away the rights of all.

M. Bastiat, accordingly, limits the duties of the State to watching over the public security, to administering the common domain, and to levying the taxes. He fights valiantly against the State assuming too many duties, and says:-"When the State charges itself with everything, it becomes responsible fer everything. Under this system a suffering people can only look to the Government, and their only remedy and only policy is to overthrow it. Hence an inevitable chain of revolutions - I say inevitable, for under such a system the people must suffer injustice, ruin, suffering, and discontent, combined with the displacement of responsibility, cannot but lead to political convulsion." It is to be feared, too," he adds, "when a Government has assumed these gigantic proportions by transforming private business into public services, that revolutions, which are in themselves such terrible evils, are not even a remedy, except by the lessons of experience they afford. The displacement of responsibility perverts the public view. The people, accustomed to expect everything from the State, do not accuse it of doing too much, but of not doing enough. They destroy it and supersede it by another to which they do not say do less, but do more; and thus the abyss has been dug and is digging again."

We doubt, however, whether the great principle of services being exchanged for services is applicable to Governments and their subjects. It is not a fact that Government is now anywhere, except in the United States, the result of the deliberate and voluntary action of the people. In most cases they are born to it or born under it as a burden or an inheritance. They may be destined to outgrow it; they cannot shake it off. Though it acts only by the will of the people, their will is more instinctive than deliberative, and the general obedience, like the general striving after good, is more impulse than reason. France has gone through the process, supposed by M. Bastiat to constitute a Government of the people's will. The citizens have chosen their representatives, or rather their representative, in the person of Prince Louis, and he has already decided in a great variety of cases, besides continuing the action of the State in others, what the State shall and shall not do. For the services he thus renders to the whole people he decides, too, what he shall be paid for his part of them, and what the whole people shall pay for the services he ordains the State shall perform, or it has been accustomed to perform. In all the process there is nothing like an exchange of service for services voluntarily made, which is the peculiar feature of M. Bastiat's system. We fear, therefore, that the services of Governments cannot be measured by the rules of political economy, and that they stand apart from and are extraneous to the natural organisation of society, of which mutual voluntary exchange is a principle, and which we have nowhere seen so well described as in the first chapter of M. Bastiat's Harmonies Economiques.

Taking the facts that were continually passing before him for his text, and alarmed, as every rational man might well be, at the prodigious number of demands made by the French on the State,
and convinced as he was that the bulk of those demands were the necessary consequence of the gigantic assumptions of the State, M. Bastiat was the most consistent and the sturdiest opponent of Government action who has appeared in our time, or, perhaps, has ever appeared in the world. He carried his doctrines much beyond mere considerations of wealth, except as its production is indirectly and remotely influenced by the deadening of the faculties, the consequence of Government undertaking to do too much for the people; and more than any other economist, not of the sentimental school, he extended his researches from the works of man's hands to man himself, and the natural laws under which he lives in society.

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