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frédéric bastiat—free markets

 

 


The modern replacement bust of Frederic Bastiat

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Portrait o Frederic Bastiat, engraving
Frédéric Bastiat, 1801-1850

Do what you will, gentlemen; you cannot give money to some without taking it from others.

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What gives me courage is…the thought that, perhaps, my life may not have been useless to mankind.

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… heavy government expenditures and liberty are incompatible.

introduction
monument of Bastiat
Bastiat on why socialism cannot work
satirical story about candlemakers in the 19th century
the broken window, from what is seen and what is not seen
the balance of payments, socialist economic theory vs reality
bastiat’s regular method of reductio ad absurdum
where bastiat lived
bibliography
end notes

Like Keynes, Frédéric Bastiat [1801-1850] worked himself to death for the good of his country. Bastiat is important because, like Keynes, he was a pragmatist who chose to speak out clearly without concern for political favours.

Bastiat concerned himself with economics long before Keynes and the widespread development of modern, cartelised, fiat currencies. Thus, Bastiat worked before the advent of modern macro-economics of the Chicago school. Bastiat’s economic understanding is prior to to the huge advance of the factory system (mass production) and the ever-growing complexity of modern society. Even at the end of Bastiat’s life, modern society was merely a twinkle in the eye of the Creator (reality).

Had Bastiat only been a populariser of free-market economics, he would be interesting historically. Much more interesting is his concern for human freedom, and his understanding of the great threat posed to freedom by the would-be, fantasist system builders of the nascent socialist theorists.

monument of Bastiat

Monument raised to the memory of the economist Bastiat at the Square of Mugron
“Monument raised to the memory of the economist Bastiat at the Square of Mugron”, and inaugurated on 23 April 1878
engraving from the magazine Le Monde illustré, 1878
This monument to Bastiat, with its accompanying statue of Renomée [Fame] writing a list of Bastiat’s most important works on the side of the plinth, lasted until the 2nd World War. Then in 1942, the Germans searching for non-ferrous metals, demolished the statues to melt them down for the bronze. Fortunately, there was still a mould of the bust in the custody of the municipality, so that was used to remake the bust after the war. The new bust was remounted on the original plinth.

The modern replacement bust of Frederic Bastiat
The modern replacement bust of Frédéric Bastiat,
in Mugron town square

the current monument has plaques on each side, each with a different text.

 

 

 


advertising disclaimer

Frederic Bastiat plaque
To the front, Bastiat’s major works:
Cobden and the League,
Economic Sophisms,
Economic Harmonies, the Law.
Frederic Bastiat plaque
To the left:
This monument was inaugurated
the 23 April 1878
Frederic Bastiat plaque
To the rear:
To the great economist!
His admirers and friends.
Frederic Bastiat plaque
To the right:
Justice of the Peace in the canton of Mugron, Member of the General Council of Les Landes, representing the people at the constitutional and legislative assemblies [in Paris].

Bastiat on why socialism cannot work

Bastiat wrote innumerable pamphlets and articles in publications. Right up to his death, Bastiat was writing as fast as he could, to try and make people understand the distillation of his decades of study. Bastiat was working on Economic Harmonies at his death.

Frédéric Bastiat on why socialism cannot work, from Economic Harmonies, 1850.
20.90
Let us say first of all that the law must take this stand whenever it is dealing with a debatable act or practice, when one part of the population approves of something of which the other part disapproves. You contend that I am wrong to practice Catholicism; and I contend that you are wrong to practice Lutheranism. Let us leave it to God to judge. Why should I strike at you, or why should you strike at me? If it is not good that one of us should strike at the other, how can it be good that we should delegate to a third party, who controls the public police force, the authority to strike at one of us in order to please the other?

20.91
You contend that I am wrong to teach my son science and philosophy; I believe that you are wrong to teach yours Greek and Latin. Let us both follow the dictates of our conscience. Let us allow the law of responsibility [consequences] to operate for our families. It will punish the one who is wrong. Let us not call in human law; it could well punish the one who is not wrong.

20.92
You say that I would do better to follow a given career, to work in a given way, to use a steel plow instead of a wooden one, to sow sparsely rather than thickly, to buy from the East rather than from the West. I maintain the contrary. I have made my calculations; after all, I am more vitally concerned than you in not making a mistake in matters that will decide my own well-being, the happiness of my family, matters that can concern you only as they touch your vanity or your systems. Advise me, but do not force your opinion on me. I shall decide at my peril and risk; that is enough, and for the law to interfere would be tyranny.

20.93
We see, then, that in almost all of the important actions of life we must respect men's free will, defer to their own good judgment, to that inner light that God has given them to use, and beyond this to let the law of responsibility take its course.

 

satirical story about candlemakers in the 19th century

on tariffs and restrictive practices

A major recurring theme in Bastiat’s writings is his raging against the bad logic that claims society can be enriched by taxing and preferential subsidies for favoured client industries. Bastiat was constantly on the alert for damaging socialist schemes that attempt to disavantage competitors by tariffs that end up making products more expensive for the common man. Taxes, taken from the public and used to support unions and businesses, inevitably undermine more productive workers and industries.

Bastiat consistently supports individual freedom and choice, while mocking the grandiose schemes of would-be social engineers.

In France, the manufacturers of products associated with lighting - from candles to candlesticks, street lamps to tapers, by way of tallow, resins, oils and alcohol - had a brilliant idea to ensure that the domestic market for lighting had a head start against foreign competitors.

They would ensure that no advantage was gained from the free light emanating from the sun, which clearly undercuts all genuine and legitimate manufacturers of light and lighting. This would be in line with the trade barriers already in place against foreign suppliers offering products such as wheat, coal, iron and textiles at prices way lower than French producers could hope to reach.

The National Assembly [House of Commons] was petitioned to pass a law requiring all blinds, shutters, curtains and other means of stopping sunlight entering into buildings be closed - permanently.

Shutting off much access for natural light creates a continuing demand for artificial light, thus providing opportunities for many industries. Clearly this would generate many positive benefits for commerce and industry, and so society in general. The advantages would include:

  • A greater demand for candles, that are made from tallow, requiring more cattle and sheep that provide the fat for making the tallow. Clearly, there will be the knock-on effect of more land being cleared and maintained for the animals, as well as increased by-products of meat, leather, wool and manure, all which are the basis of agricultural wealth.
  • The greater demand for oil to put in oil lamps will see the expansion in cultivation of poppies, olives and rapeseed. Any soil depletion caused by these crops would be offset by the increased availability of animal manure.
  • Moorland would be covered by resinous trees, which would draw bees to collect otherwise wasted scented pollen, creating another industry.
  • The need for more whale blubber would mean more ship-building to increase the fleet, and so more jobs for sailors to man the ships.
  • Another industry that would grow is in the creation and manufacture of new styles of lamps, candlesticks, candelabras, as well as the decorating and gilding of the items.

The whole of French industry and society would benefit from this simple change to living conditions, from shareholders in shipping companies to the lowliest match vendor, thus making French industries grow considerably, and so out-compete perfidious Albion, where manufacturing will fail to develop as it suffers from the foolish use of free sunlight.

[Abridged and rewritten from the original text of Economic Sophisms, 1845]

View of the Chalossais valley from the Place Chantilly in central Mugron
View of the Chalossais valley from the Place Chantilly in central Mugron

the broken window, from the pamphlet what is seen and what is not seen, published in 1848

This story is a useful warning about the inclusion of destruction and politicians’ vanity projects in the GDP [gross domestic product] of nations, as if such activities add to the common good without incurring real costs.

Have you ever witnessed the anger of the good shopkeeper, James B., when his careless son happened to break a square of glass? If you have been present at such a scene, you will most assuredly bear witness to the fact, that every one of the spectators, were there even thirty of them, by common consent apparently, offered the unfortunate owner this invariable consolation - "It is an ill wind that blows nobody good. Everybody must live, and what would become of the glaziers if panes of glass were never broken?"

Now, this form of condolence contains an entire theory, which it will be well to show up in this simple case, seeing that it is precisely the same as that which, unhappily, regulates the greater part of our economical institutions.

Suppose it cost six francs to repair the damage, and you say that the accident brings six francs to the glazier's trade - that it encourages that trade to the amount of six francs - I grant it; I have not a word to say against it; you reason justly. The glazier comes, performs his task, receives his six francs, rubs his hands, and, in his heart, blesses the careless child. All this is that which is seen.

But if, on the other hand, you come to the conclusion, as is too often the case, that it is a good thing to break windows, that it causes money to circulate, and that the encouragement of industry in general will be the result of it, you will oblige me to call out, "Stop there! your theory is confined to that which is seen; it takes no account of that which is not seen."

It is not seen that as our shopkeeper has spent six francs upon one thing, he cannot spend them upon another. It is not seen that if he had not had a window to replace, he would, perhaps, have replaced his old shoes, or added another book to his library. In short, he would have employed his six francs in some way, which this accident has prevented.

Let us take a view of industry in general, as affected by this circumstance. The window being broken, the glazier's trade is encouraged to the amount of six francs; this is that which is seen. If the window had not been broken, the shoemaker's trade (or some other) would have been encouraged to the amount of six francs; this is that which is not seen.

And if that which is not seen is taken into consideration, because it is a negative fact, as well as that which is seen, because it is a positive fact, it will be understood that neither industry in general, nor the sum total of national labour, is affected, whether windows are broken or not.

Now let us consider James B. himself. In the former supposition, that of the window being broken, he spends six francs, and has neither more nor less than he had before, the enjoyment of a window.

In the second, where we suppose the window not to have been broken, he would have spent six francs on shoes, and would have had at the same time the enjoyment of a pair of shoes and of a window.

Now, as James B. forms a part of society, we must come to the conclusion, that, taking it altogether, and making an estimate of its enjoyments and its labours, it has lost the value of the broken window.

When we arrive at this unexpected conclusion: "Society loses the value of things which are uselessly destroyed;" and we must assent to a maxim which will make the hair of protectionists stand on end - To break, to spoil, to waste, is not to encourage national labour; or, more briefly, "destruction is not profit."

What will you say, Monsieur Industriel -- what will you say, disciples of good M. F. Chamans, who has calculated with so much precision how much trade would gain by the burning of Paris, from the number of houses it would be necessary to rebuild?

I am sorry to disturb these ingenious calculations, as far as their spirit has been introduced into our legislation; but I beg him to begin them again, by taking into the account that which is not seen, and placing it alongside of that which is seen. The reader must take care to remember that there are not two persons only, but three concerned in the little scene which I have submitted to his attention. One of them, James B., represents the consumer, reduced, by an act of destruction, to one enjoyment instead of two. Another under the title of the glazier, shows us the producer, whose trade is encouraged by the accident. The third is the shoemaker (or some other tradesman), whose labour suffers proportionably by the same cause. It is this third person who is always kept in the shade, and who, personating that which is not seen, is a necessary element of the problem. It is he who shows us how absurd it is to think we see a profit in an act of destruction. It is he who will soon teach us that it is not less absurd to see a profit in a restriction, which is, after all, nothing else than a partial destruction. Therefore, if you will only go to the root of all the arguments which are adduced in its favour, all you will find will be the paraphrase of this vulgar saying - What would become of the glaziers, if nobody ever broke windows?

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the balance of payments, socialist economic theory vs reality

I was at Bordeaux. I had a cask of wine which was worth 50 francs; I sent it to Liverpool, and the customhouse noted on its records an export of 50 francs.

At Liverpool the wine was sold for 70 francs. My representative converted the 70 francs into coal, which was found to be worth 90 francs on the market at Bordeaux. The customhouse hastened to record an import of 90 francs.

Balance of trade, or the excess of imports over exports: 40 francs.

These 40 francs, I have always believed, putting my trust in my books, I had gained. But M. Mauguin tells me that I have lost them, and that France has lost them in my person.

And why does M. Mauguin see a loss here? Because he supposes that any excess of imports over exports necessarily implies a balance that must be paid in cash. But where is there in the transaction that I speak of, which follows the pattern of all profitable commercial transactions, any balance to pay? Is it, then, so difficult to understand that a merchant compares the prices current in different markets and decides to trade only when he has the certainty, or at least the probability, of seeing the exported value return to him increased? Hence, what M. Mauguin calls loss should be called profit.

A few days after my transaction I had the simplicity to experience regret; I was sorry I had not waited. In fact, the price of wine fell at Bordeaux and rose at Liverpool; so that if I had not been so hasty, I could have bought at 40 francs and sold at 100 francs. I truly believed that on such a basis my profit would have been greater. But I learn from M. Mauguin that it is the loss that would have been more ruinous.

My second transaction had a very different result.

I had had some truffles shipped from Périgord which cost me 100 francs; they were destined for two distinguished English cabinet ministers for a very high price, which I proposed to turn into pounds sterling. Alas, I would have done better to eat them myself (I mean the truffles, not the English pounds or the Tories). All would not have been lost, as they were, for the ship that carried them off sank on its departure. The customs officer, who had noted on this occasion an export of 100 francs, never had any re-import to enter in this case.

Hence, M. Mauguin would say, France gained 100 francs; for it was, in fact, by this sum that the export, thanks to the shipwreck, exceeded the import. If the affair had turned out otherwise, if I had received 200 or 300 francs' worth of English pounds, then the balance of trade would have been unfavorable, and France would have been the loser.

From the point of view of science, it is sad to think that all the commercial transactions which end in loss according to the businessmen concerned show a profit according to that class of theorists who are always declaiming against theory.

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bastiat’s regular method of reductio ad absurdum

From Frédéric Bastiat, a man alone, pp 231-2
As Henry Hazlitt pointed out in his introduction to one of Bastiat’s books:

He was the master of the reductio ad absurdum. Someone suggests that the proposed new railroad from Paris to Madrid should have a break at Bordeaux. The argument is that if goods and passengers are forced to stop at that city, it will be profitable for boatmen, porters, hotelkeepers and others there. Good, says Bastiat. But then why not break it also at Angouleme, Poitiers, Tours, Orleans, and, in fact, at all intermediate points? The more breaks there are, the greater the amount paid for storage, porters, extra cartage. We could have a railroad consisting of nothing but such gaps-a negative railroad!

 

where bastiat lived

Google satellite map of Sengresse and Mugron

The Bastiat family property at Sengresse, near Mugron, was acquired by Frédéric Bastiat’s grandfather after the Revolution.

In 1825, when Bastiat was 24 years old, his grandfather died. He inherited the manor Sengresse and over a dozen farms. Bastiat then lived at Sengresse.

Sengresse    Sengresse
The main house and cyclamen-covered lawn that are part of the Bastiat former estate at Sengresse,
near Mugron in Les Landes

The substantial and comfortably restored house with three hectares (7.5 acres) now takes paying guests.

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Mugron a pretty little town, which has almost forgotten Frédéric Bastiat, looks down over the fertile Chalossais valley. However, Bastiat is remembered in many of the local villages and towns, which often have their own rue de Frédéric Bastiat.

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There is a local organisation, le cercle Frédéric Bastiat, that has two missions :

  1. To keep alive the memory of that great humanist and economist, Frédéric Bastiat.
  2. To propagate his ethics of individual liberty and responsibility.

As well as with conferences, they fulfil their aims by holding a dinner-debate every quarter with a disourse and debate focussing on social and economic issues. Some of the discourses are translated into English, while all are available in French.

 

related material
citizen’s wage
It is necessary to remember that Bastiat was financially secure, and a land owner.

 

bibliography

Marker at abelard.org Frédéric Bastiat, a man alone
by George Charles Roche III
Frederic Bastiat by Roche

amazon.co.uk
Arlington House,1971
ISBN-10: 0870001167
ISBN-13: 978-0870001161

amazon.com
Arlington House, 1970
ASIN: B002TBFWUQ

This book is a very useful and readable introduction to the life of Frédéric Bastiat in the context of the history of politics and economics.
Marker at abelard.org By Robert Leroux

Lire Bastiat : Science sociale et liberalisme

 

Political Economy and Liberalism in France

Original in French:
Lire Bastiat : Science sociale et libéralisme

Hermann, pbk, 2008
Language French
ISBN-10: 2705667156
ISBN-13: 978-2705667153
£20.01 [amazon.co.uk]

Unfortunately, the English translation is sold at an exorbitant price. A more reasonably priced paperback edition may appear in due course.
Political Economy and Liberalism in France: The Contributions of Frederic Bastiat (Routledge Studies in the History of Economics)

Routledge, hbk, 2011
ISBN-10: 0415580552
ISBN-13: 978-0415580557
£71.25 [amazon.co.uk]
$115.56 [amazon.com]

Marker at abelard.org Frederic Bastiat, Library of Economics and Liberty
Providing links to complete versions in English of Bastiat’s main works.
Marker at abelard.org bastiat.net [English version]
Some personal background to Frédéric Bastiat..

 

end notes

  1. Cobden and the League, published in 1845
    Economic Sophisms, published in 1845
    Economic Harmonies, published in 1850
    the Law published in 1850.

  2. The sculptor of this statue was Gabriel-Vital Dubray [1813-1878].

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