By Frédéric Bastiat
Frédéric Bastiat (1801-1850) was a French economist, statesman, and author. He was the leader of the free-trade movement in France from its inception in 1840 until his untimely death in 1850. The first 45 years of his life were spent in preparation for five tremendously productive years writing in favor of freedom. Bastiat was the founder of the weekly newspaper
Le Libre Échange, a contributor to numerous periodicals, and the author of sundry pamphlets and speeches dealing with the pressing issues of his day. Most of his writing was done in the years directly before and after the Revolution of 1848—a time when France was rapidly embracing socialism. As a deputy in the Legislative Assembly, Bastiat fought valiantly for the private property order, but unfortunately the majority of his colleagues chose to ignore him. Frédéric Bastiat remains one of the great champions of freedom whose writings retain their relevance as we continue to confront the old adversary.
Arthur Goddard, trans., trans.
First Pub. Date
Irvington-on-Hudson, NY: The Foundation for Economic Education, Inc.
Introduction by Henry Hazlitt
The text of this edition is under copyright
- About the Author
- Preface to the English-Language Edition, by Arthur Goddard
- Introduction, by Henry Hazlitt
- S.1, Author's Introduction to the French Edition
- S.1, Ch.1, Abundance and Scarcity
- S.1, Ch.2, Obstacle and Cause
- S.1, Ch.3, Effort and Result
- S.1, Ch.4, Equalizing the Conditions of Production
- S.1, Ch.5, Our Products Are Burdened with Taxes
- S.1, Ch.6, The Balance of Trade
- S.1, Ch.7, A Petition
- S.1, Ch.8, Differential Tariffs
- S.1, Ch.9, An Immense Discovery
- S.1, Ch.10, Reciprocity
- S.1, Ch.11, Money Prices
- S.1, Ch.12, Does Protectionism Raise Wage Rates
- S.1, Ch.13, Theory and Practice
- S.1, Ch.14, Conflict of Principles
- S.1, Ch.15, Reciprocity Again
- S.1, Ch.16, Obstructed Rivers as Advocates for the Protectionists
- S.1, Ch.17, A Negative Railroad
- S.1, Ch.18, There Are No Absolute Principles
- S.1, Ch.19, National Independence
- S.1, Ch.20, Human vs. Mechanical Labor and Domestic vs. Foreign Labor
- S.1, Ch.21, Raw Materials
- S.1, Ch.22, Metaphors
- S.1, Ch.23, Conclusion
- S.2, Ch.1, The Physiology of Plunder
- S.2, Ch.2, Two Systems of Ethics
- S.2, Ch.3, The Two Hatchets
- S.2, Ch.4, Subordinate Labor Council
- S.2, Ch.5, High Prices and Low Prices
- S.2, Ch.6, To Artisans and Laborers
- S.2, Ch.7, A Chinese Tale
- S.2, Ch.8, Post Hoc, Ergo Propter Hoc
- S.2, Ch.9, Robbery by Subsidy
- S.2, Ch.10, The Tax Collector
- S.2, Ch.11, The Utopian
- S.2, Ch.12, Salt, the Postal Service, and the Tariff
- S.2, Ch.13, Protectionism, or the Three Aldermen
- S.2, Ch.14, Something Else
- S.2, Ch.15, The Little Arsenal of the Freetrader
- S.2, Ch.16, The Right Hand and the Left
- S.2, Ch.17, Domination through Industrial Superiority
An Immense Discovery!
First Series, Chapter 9
At a time when everyone is trying to find a way of reducing the costs of transportation; when, in order to realize these economies, highways are being graded, rivers are being canalized, steamboats are being improved, and Paris is being connected with all our frontiers by a network of railroads and by atmospheric, hydraulic, pneumatic, electric, and other traction systems; when, in short, I believe that everyone is zealously and sincerely seeking the solution of the problem of
reducing as much as possible the difference between the prices of commodities in the places where they are produced and their prices in the places where they are consumed; I should consider myself failing in my duty toward my country, toward my age, and toward myself, if I any longer kept secret the wonderful discovery I have just made.
Although the daydreams of inventors have been proverbially optimistic, I feel positively certain that I have discovered an infallible means of bringing to France the products of the whole world, and vice versa, at a considerable reduction in cost.
But its being infallible is only one of the advantages of my astounding discovery.
It requires neither plans nor estimates nor preparatory studies nor engineers nor mechanics nor contractors nor capital nor stockholders nor government aid!
It presents no danger of shipwreck, explosion, collision, fire, or derailment!
It can be put into effect in a single day!
Finally, and this will doubtless recommend it to the public, it will not add a centime to the budget; quite the contrary. It will not increase the staff of government officials or the requirements of the bureaucracy; quite the contrary. It will cost no one his freedom; quite the contrary.
It was not chance, but observation, that put me in possession of my discovery. Let me tell you how I was led to make it.
I had this question to resolve:
“Why should a thing made in Brussels, for example, cost more when it reaches Paris?”
Now, it did not take me long to perceive that the rise in price results from the existence of
obstacles of several kinds between Paris and Brussels. First of all, there is the
distance; we cannot traverse it without effort or loss of time, and we must either submit to this ourselves or pay someone else to submit to it. Then come rivers, marshes, irregularities of terrain, and mud; these are just so many more
impediments to overcome. We succeed in doing so by raising causeways, by building bridges, by laying and paving roads, by laying steel rails, etc. But all this costs money, and the commodity transported must bear its share of the expenses. There are, besides, highway robbers, necessitating a constabulary, a police force, etc.
Now, among these
obstacles between Brussels and Paris there is one that we ourselves have set up, and at great cost. There are men lying in wait along the whole length of the frontier, armed to the teeth and charged with the task of putting difficulties in the way of transporting goods from one country to the other. They are called
customs officials. They act in exactly the same way as the mud and the ruts. They delay and impede commerce; they contribute to the difference that we have noted between the price paid by the consumer and the price received by the producer, a difference that it is our problem to reduce as much as possible.
And herein lies the solution of the problem. Reduce the tariff.
You will then have, in effect, constructed the Northern Railway without its costing you anything. Far from it! You will effect such enormous savings that you will begin to put money in your pocket from the very first day of its operation.
Really, I wonder how we could have ever thought of doing anything so fantastic as to pay many millions of francs for the purpose of removing the
natural obstacles that stand between France and other countries, and at the same time pay many other millions for the purpose of substituting
artificial obstacles that have exactly the same effect; so that the obstacle created and the obstacle removed neutralize each other and leave things quite as they were before, the only difference being the double expense of the whole operation.
A Belgian product is worth twenty francs at Brussels, but thirty francs when taken to Paris, because of transportation charges. The same article made in Paris is worth forty francs. How do we handle the problem?
First, we impose a customs duty of at least ten francs on the Belgian product, in order to raise its sales price at Paris to forty francs, and we pay numerous inspectors to see that it does not escape this tariff; with the result that, in transit, it is charged ten francs for transportation and ten francs for the tax.
Having done this, we reason as follows: This transportation charge of ten francs from Brussels to Paris is excessive. Let us spend two or three hundred millions for railroads, and we shall cut it in half. Yet clearly, all that we shall gain is that the Belgian product will be sold in Paris for thirty-five francs, to wit:
|20 francs||…………….||its price at Brussels|
|10 francs||…………….||customs duty|
|5 francs||…………….||reduced transportation cost by railroad|
|35 francs||…………….||total, or sales price at Paris|
Now, should we not have achieved the same result by lowering the tariff to five francs? We should then have:
|20 francs||…………….||price at Brussels|
|5 francs||…………….||reduced customs duty|
|10 francs||…………….||transportation cost by ordinary routes|
|35 francs||…………….||total, or sales price at Paris|
And this proceeding would save us the 200 millions the railroads would cost us, plus the costs of customs inspection, which will necessarily be reduced, since the lower tariff will constitute less of an incentive to smuggle.
But, it will be said, the tariff is necessary to protect Parisian industry. So be it; but do not, then, destroy its effectiveness by your railroad.
For if you persist in demanding that the Belgian product, like that of Paris, cost forty francs, you will have to raise the tariff to fifteen francs, so as to have:
|20 francs||…………….||price at Brussels|
|15 francs||…………….||protective tariff|
|5 francs||…………….||railroad transportation charges|
|40 francs||…………….||total at equalized prices|
But then, I venture to ask, what, in that case, is the good of the railroad?
Frankly, is it not somewhat humiliating for the nineteenth century to provide future ages with the spectacle of such childish behavior carried on with such an air of imperturbable gravity? To be hoodwinked by someone else is not very agreeable; but to use the vast apparatus of representative government to hoodwink ourselves, not just once, but twice over—and that, too, in a little matter of arithmetic—is surely something to temper our pride in being the
century of enlightenment.
First Series, Chapter 8
First Series, Chapter 10
The Coach and the Fly (Le Coche et la mouche): “Over a sandy, hilly, and difficult road, / Exposed to the sun on all sides / Six strong horses were drawing a coach.”—TRANSLATOR.]
First Series, Chapter 11
Du Système impôt fondé sur les principes d’économie politique.—TRANSLATOR.]
infra, Second Series, chap. 5, and
Economic Harmonies, chap. 4.—EDITOR.]
First Series, Chapter 12
Economic Harmonies, chap. 14.—EDITOR.]
First Series, Chapter 13