How does this come about? I will try to make it understood by some examples.

Let us go back to the thirteenth century. Men who gave themselves up to the business of copying, received for this service a remuneration regulated by the general rate of profits. Among them is found one, who seeks and finds the means of multiplying rapidly copies of the same work. He invents printing. The first effect of this is, that the individual is enriched, while many more are impoverished. At the first view, wonderful as the discovery is, one hesitates in deciding whether it is not more injurious than useful. It seems to have introduced into the world, as I said above, an element of infinite inequality. Guttenberg makes large profits by this invention, and perfects the invention by the profits, until all other copyists are ruined. As for the public,—the consumer,—it gains but little, for Guttenberg takes care to lower the price of books only just so much as is necessary to undersell all rivals.

But the great Mind which put harmony into the movements of celestial bodies, could also give it to the internal mechanism of society. We will see the advantages of this invention escaping from the individual, to become forever the common patrimony of mankind.

The process finally becomes known. Guttenberg is no longer alone in his art; others imitate him. Their profits are at first considerable. They are recompensed for being the first who make the effort to imitate the processes of the newly invented art. This again was necessary, in order that they might be induced to the effort, and thus forward the great and final result to which we approach. They gain much; but they gain less than the inventor, for competition has commenced its work. The price of books now continually decreases. The gains of the imitators diminish in proportion as the invention becomes older; and in the same proportion imitation becomes less meritorious. Soon the new object of industry attains its normal condition; in other words, the remuneration of printers is no longer an exception to the general rules of remuneration, and, like that of copyists formerly, it is only regulated by the general rate of profits. Here then the producer, as such, holds only the old position. The discovery, however, has been made; the saving of time, labor, effort, for a fixed result, for a certain number of volumes, is realized. But in what is this manifested? In the cheap price of books. For the good of whom? For the good of the consumer,—of society,—of humanity. Printers, having no longer any peculiar merit, receive no longer a peculiar remuneration. As men,—as consumers,—they no doubt participate in the advantages which the invention confers upon the community; but that is all. As printers, as producers, they are placed upon the ordinary footing of all other producers. Society pays them for their labor, and not for the usefulness of the invention. That has become a gratuitous benefit, a common heritage to mankind.

What has been said of printing can be extended to every agent for the advancement of labor; from the nail and the mallet, up to the locomotive and the electric telegraph. Society enjoys all, by the abundance of its use, its consumption; and it enjoys all gratuitously. For as their effect is to diminish prices, it is evident that just so much of the price as is taken off by their intervention, renders the production in so far gratuitous. There only remains the actual labor of man to be paid for; and the remainder, which is the result of the invention, is subtracted; at least after the invention has run through the cycle which I have just described as its destined course. I send for a workman; he brings a saw with him; I pay him two francs for his day's labor, and he saws me twenty-five boards. If the saw had not been invented, he would perhaps not have been able to make one board, and I would have paid him the same for his day's labor. The usefulness then of the saw, is for me a gratuitous gift of nature, or rather it is a portion of the inheritance which, in common with my brother men, I have received from the genius of my ancestors. I have two workmen in my field; the one directs the handle of a plough, the other that of a spade. The result of their day's labor is very different, but the price is the same, because the remuneration is proportioned, not to the usefulness of the result, but to the effort, the labor given to attain it.

I invoke the patience of the reader, and beg him to believe, that I have not lost sight of free trade: I entreat him only to remember the conclusion at which I have arrived: Remuneration is not proportioned to the usefulness of the articles brought by the producer into the market, but to the labor.[11]

[Footnote 11: It is true that labor does not receive a uniform remuneration; because labor is more or less intense, dangerous, skillful, etc. Competition establishes for each category a price current; and it is of this variable price that I speak.]

I have so far taken my examples from human inventions, but will now go on to speak of natural advantages.

In every article of production, nature and man must concur. But the portion of nature is always gratuitous. Only so much of the usefulness of an article as is the result of human labor becomes the object of mutual exchange, and consequently of remuneration. The remuneration varies much, no doubt, in proportion to the intensity of the labor, of the skill which it requires, of its being a propos to the demand of the day, of the need which exists for it, of the momentary absence of competition, etc. But it is not the less true in principle, that the assistance received from natural laws, which belongs to all, counts for nothing in the price.

We do not pay for the air we breathe, although so useful to us, that we could not live two minutes without it. We do not pay for it, because Nature furnishes it without the intervention of man's labor. But if we wish to separate one of the gases which compose it, for instance, to fill a balloon, we must take some trouble and labor; or if another takes it for us, we must give him an equivalent in something which will have cost us the trouble of production. From which we see that the exchange is between troubles, efforts, labors. It is certainly not for hydrogen gas that I pay, for this is every where at my disposal, but for the work that it has been necessary to accomplish in order to disengage it; work which I have been spared, and which I must refund. If I am told that there are other things to pay for; as expense, materials, apparatus; I answer, that still in these things it is the work that I pay for. The price of the coal employed is only the representation of the labor necessary to dig and transport it.

We do not pay for the light of the sun, because Nature alone gives it to us. But we pay for the light of gas, tallow, oil, wax, because here is labor to be remunerated;—and remark, that it is so entirely labor and not utility to which remuneration is proportioned, that it may well happen that one of these means of lighting, while it may be much more effective than another, may still cost less. To cause this, it is only necessary that less human labor should be required to furnish it.

When the water-carrier comes to supply my house, were I to pay him in proportion to the absolute utility of the water, my whole fortune would not be sufficient. But I pay him only for the trouble he has taken. If he requires more, I can get others to furnish it, or finally go and get it myself. The water itself is not the subject of our bargain; but the labor taken to get the water. This point of view is so important, and the consequences that I am going to draw from it so clear, as regards the freedom of international exchanges, that I will still elucidate my idea by a few more examples.

The alimentary substance contained in potatoes does not cost us very dear, because a great deal of it is attainable with little work. We pay more for wheat, because, to produce it Nature requires more labor from man. It is evident that if Nature did for the latter what she does for the former, their prices would tend to the same level. It is impossible that the producer of wheat should permanently gain more than the producer of potatoes. The law of competition cannot allow it.

If by a happy miracle the fertility of all arable lands were to be increased, it would not be the agriculturist, but the consumer, who would profit by this phenomenon; for the result of it would be, abundance and cheapness. There would be less labor incorporated into an acre of grain, and the agriculturist would be therefore obliged to exchange it for a less labor incorporated into some other article. If, on the contrary, the fertility of the soil were suddenly to deteriorate, the share of Nature in production would be less, that of labor greater, and the result would be higher prices. I am right then in saying that it is in consumption, in mankind, that at length all political phenomena find their solution. As long as we fail to follow their effects to this point, and look only at immediate effects, which act but upon individual men or classes of men as producers, we know nothing more of political economy than the quack does of medicine, when, instead of following the effects of a prescription in its action upon the whole system, he satisfies himself with knowing how it affects the palate and the throat.

The tropical regions are very favorable to the production of sugar and coffee; that is to say, Nature does most of the business and leaves but little for labor to accomplish. But who reaps the advantage of this liberality of Nature? Not these regions, for they are forced by competition to receive simply remuneration for their labor. It is mankind who is the gainer; for the result of this liberality is cheapness, and cheapness belongs to the world.

Here in the temperate zone, we find coal and iron ore, on the surface of the soil; we have but to stoop and take them. At first, I grant, the immediate inhabitants profit by this fortunate circumstance. But soon comes competition, and the price of coal and iron falls, until this gift of Nature becomes gratuitous to all, and human labor is only paid according to the general rate of profits.

Thus natural advantages, like improvements in the process of production, are, or have a constant tendency to become, under the law of competition, the common and gratuitous patrimony of consumers, of society, of mankind. Countries therefore which do not enjoy these advantages, must gain by commerce with those which do; because the exchanges of commerce are between labor and labor; subtraction being made of all the natural advantages which are combined with these labors; and it is evidently the most favored countries which can incorporate into a given labor the largest proportion of these natural advantages. Their produce representing less labor, receives less recompense; in other words, is cheaper. If then all the liberality of Nature results in cheapness, it is evidently not the producing, but the consuming country, which profits by her benefits.

Hence we may see the enormous absurdity of the consuming country, which rejects produce precisely because it is cheap. It is as though we should say: "We will have nothing of that which Nature gives you. You ask of us an effort equal to two, in order to furnish ourselves with articles only attainable at home by an effort equal to four. You can do it because with you Nature does half the work. But we will have nothing to do with it; we will wait till your climate, becoming more inclement, forces you to ask of us a labor equal to four, and then we can treat with you upon an equal footing."

A is a favored country; B is maltreated by Nature. Mutual traffic then is advantageous to both, but principally to B, because the exchange is not between utility and utility, but between value and value. Now A furnishes a greater utility in a similar value, because the utility of any article includes at once what Nature and what labor have done; whereas the value of it only corresponds to the portion accomplished by labor. B then makes an entirely advantageous bargain; for by simply paying the producer from A for his labor, it receives in return not only the results of that labor, but in addition there is thrown in whatever may have accrued from the superior bounty of Nature.

We will lay down the general rule.

Traffic is an exchange of values; and as value is reduced by competition to the simple representation of labor, traffic is the exchange of equal labors. Whatever Nature has done towards the production of the articles exchanged, is given on both sides gratuitously; from whence it necessarily follows, that the most advantageous commerce is transacted with those countries which are the most favored by Nature.

* * * * *

The theory of which I have attempted, in this chapter, to trace the outlines, would require great developments. But perhaps the attentive reader will have perceived in it the fruitful seed which is destined in its future growth to smother Protection, at once with Fourierism, Saint Simonism, Commonism, and the various other schools whose object is to exclude the law of COMPETITION from the government of the world. Competition, no doubt, considering man as producer, must often interfere with his individual and immediate interests. But if we consider the great object of all labor, the universal good, in a word, Consumption, we cannot fail to find that Competition is to the moral world what the law of equilibrium is to the material one. It is the foundation of true Commonism, of true Socialism, of the equality of comforts and condition, so much sought after in our day; and if so many sincere reformers, so many earnest friends to the public rights, seek to reach their end by commercial legislation, it is only because they do not yet understand commercial freedom.



V.

OUR PRODUCTIONS ARE OVERLOADED WITH TAXES.

This is but a new wording of the last Sophism. The demand made is, that the foreign article should be taxed, in order to neutralize the effects of the tax, which weighs down national produce. It is still then but the question of equalizing the facilities of production. We have but to say that the tax is an artificial obstacle, which has exactly the same effect as a natural obstacle, i.e. the increasing of the price. If this increase is so great that there is more loss in producing the article in question than in attracting it from foreign parts by the production of an equivalent value, let it alone. Individual interest will soon learn to choose the lesser of two evils. I might refer the reader to the preceding demonstration for an answer to this Sophism; but it is one which recurs so often in the complaints and the petitions, I had almost said the demands, of the protectionist school, that it deserves a special discussion.

If the tax in question should be one of a special kind, directed against fixed articles of production, I agree that it is perfectly reasonable that foreign produce should be subjected to it. For instance, it would be absurd to free foreign salt from impost duty; not that in an economical point of view France would lose any thing by it; on the contrary, whatever may be said, principles are invariable, and France would gain by it, as she must always gain by avoiding an obstacle whether natural or artificial. But here the obstacle has been raised with a fiscal object. It is necessary that this end should be attained; and if foreign salt were to be sold in our market free from duty, the treasury would not receive its revenue, and would be obliged to seek it from some thing else. There would be evident inconsistency in creating an obstacle with a given object, and then avoiding the attainment of that object. It would have been better at once to seek what was needed in the other impost without taxing French salt. Such are the circumstances under which I would allow upon any foreign article a duty, not protecting but fiscal.

But the supposition that a nation, because it is subjected to heavier imposts than those of another neighboring nation, should protect itself by tariffs against the competition of its rival, is a Sophism, which it is now my purpose to attack.

I have said more than once, that I am opposing only the theory of the protectionists, with the hope of discovering the source of their errors. Were I disposed to enter into controversy with them, I would say: Why direct your tariffs principally against England and Belgium, both countries more overloaded with taxes than any in the world? Have I not a right to look upon your argument as a mere pretext? But I am not of the number of those who believe that prohibitionists are guided by interest, and not by conviction. The doctrine of Protection is too popular not to be sincere. If the majority could believe in freedom, we would be free. Without doubt it is individual interest which weighs us down with tariffs; but it acts upon conviction.

The State may make either a good or a bad use of taxes; it makes a good use of them when it renders to the public services equivalent to the value received from them; it makes a bad use of them when it expends this value, giving nothing in return.

To say in the first case that they place the country which pays them in more disadvantageous conditions for production, than the country which is free from them, is a Sophism. We pay, it is true, twenty millions for the administration of justice, and the maintenance of the police, but we have justice and the police; we have the security which they give, the time which they save for us; and it is most probable that production is neither more easy nor more active among nations, where (if there be such) each individual takes the administration of justice into his own hands. We pay, I grant, many hundred millions for roads, bridges, ports, railways; but we have these railways, these ports, bridges and roads, and unless we maintain that it is a losing business to establish them, we cannot say that they place us in a position inferior to that of nations who have, it is true, no taxes for public works, but who likewise have no public works. And here we see why (even while we accuse internal taxes of being a cause of industrial inferiority) we direct our tariffs precisely against those nations which are the most taxed. It is because these taxes, well used, far from injuring, have ameliorated the conditions of production to these nations. Thus we again arrive at the conclusion that the protectionist Sophisms not only wander from, but are the contrary—the very antithesis of truth.

As to unproductive imposts, suppress them if you can; but surely it is a most singular idea to suppose, that their evil effect is to be neutralized by the addition of individual taxes to public taxes. Many thanks for the compensation! The State, you say, has taxed us too much; surely this is no reason why we should tax each other!

A protective duty is a tax directed against foreign produce, but which returns, let us keep in mind, upon the national consumer. Is it not then a singular argument to say to him, "Because the taxes are heavy, we will raise prices higher for you; and because the State takes a part of your revenue, we will give another portion of it to benefit a monopoly?"

But let us examine more closely this Sophism so accredited among our legislators; although, strange to say, it is precisely those who keep up the unproductive imposts (according to our present hypothesis) who attribute to them afterwards our supposed inferiority, and seek to re-establish the equilibrium by further imposts and new clogs.

It appears to me to be evident that protection, without any change in its nature and effects, might have taken the form of a direct tax, raised by the State, and distributed as a premium to privileged industry.

Let us admit that foreign iron could be sold in our market at eight francs, but not lower; and French iron at not lower than twelve francs.

In this hypothesis there are two ways in which the State can secure the national market to the home producer.

The first, is to put upon foreign iron a duty of five francs. This, it is evident, would exclude it, because it could no longer be sold at less than thirteen francs; eight francs for the cost price, five for the tax; and at this price it must be driven from the market by French iron, which we have supposed to cost twelve francs. In this case the buyer, the consumer, will have paid all the expenses of the protection given.

The second means would be to lay upon the public a tax of five francs, and to give it as a premium to the iron manufacturer. The effect would in either case be equally a protective measure. Foreign iron would, according to both systems, be alike excluded; for our iron manufacturer could sell at seven francs, what, with the five francs premium, would thus bring him in twelve. While the price of sale being seven francs, foreign iron could not obtain a market at eight.

In these two systems the principle is the same; the effect is the same. There is but this single difference; in the first case the expense of protection is paid by a part, in the second by the whole of the community.

I frankly confess my preference for the second system, which I regard as more just, more economical and more legal. More just, because, if society wishes to give bounties to some of its members, the whole community ought to contribute; more economical, because it would banish many difficulties, and save the expenses of collection; more legal, lastly, because the public would see clearly into the operation, and know what was required of it.

But if the protective system had taken this form, would it not have been laughable enough to hear it said, "We pay heavy taxes for the army, the navy, the judiciary, the public works, the schools, the public debt, etc. These amount to more than a thousand million. It would therefore be desirable that the State should take another thousand million, to relieve the poor iron manufacturers; or the suffering stockholders of coal mines; or those unfortunate lumber dealers, or the useful codfishery."

This, it must be perceived, by an attentive investigation, is the result of the Sophism in question. In vain, gentlemen, are all your efforts; you cannot give money to one without taking it from another. If you are absolutely determined to exhaust the funds of the taxable community, well; but, at least, do not mock them; do not tell them, "We take from you again, in order to compensate you for what we have already taken."

It would be a too tedious undertaking to endeavor to point out all the fallacies of this Sophism. I will therefore limit myself to the consideration of it in three points.

You argue that France is overburthened with taxes, and deduce thence the conclusion that it is necessary to protect such and such an article of produce. But protection does not relieve us from the payment of these taxes. If, then, individuals devoting themselves to any one object of industry, should advance this demand: "We, from our participation in the payment of taxes, have our expenses of production increased, and therefore ask for a protective duty which shall raise our price of sale;" what is this but a demand on their part to be allowed to free themselves from the burthen of the tax, by laying it on the rest of the community? Their object is to balance, by the increased price of their produce, the amount which they pay in taxes. Now, as the whole amount of these taxes must enter into the treasury, and the increase of price must be paid by society, it follows that (where this protective duty is imposed) society has to bear, not only the general tax, but also that for the protection of the article in question. But it is answered, let every thing be protected. Firstly, this is impossible; and, again, were it possible, how could such a system give relief? I will pay for you, you will pay for me; but not the less, still there remains the tax to be paid.

Thus you are the dupes of an illusion. You determine to raise taxes for the support of an army, a navy, the church, university, judges, roads, etc. Afterwards you seek to disburthen from its portion of the tax, first one article of industry, then another, then a third; always adding to the burthen of the mass of society. You thus only create interminable complications. If you can prove that the increase of price resulting from protection, falls upon the foreign producer, I grant something specious in your argument. But if it be true that the French people paid the tax before the passing of the protective duty, and afterwards that it has paid not only the tax, but the protective duty also, truly I do not perceive wherein it has profited.

But I go much further, and maintain that the more oppressive our taxes are, the more anxiously ought we to open our ports and frontiers to foreign nations, less burthened than ourselves. And why? In order that we may share with them, as much as possible, the burthen which we bear. Is it not an incontestable maxim in political economy, that taxes must, in the end, fall upon the consumer? The greater then our commerce, the greater the portion which will be reimbursed to us, of taxes incorporated in the produce, which we will have sold to foreign consumers; whilst we, on our part, will have made to them only a lesser reimbursement, because (according to our hypothesis) their produce is less taxed than ours.

Again, finally, has it ever occurred to you to ask yourself, whether these heavy taxes which you adduce as a reason for keeping up the prohibitive system, may not be the result of this very system itself? To what purpose would be our great standing armies, and our powerful navies, if commerce were free?



VI.

BALANCE OF TRADE.

Our adversaries have adopted a system of tactics, which embarrasses us not a little. Do we prove our doctrine? They admit the truth of it in the most respectful manner. Do we attack their principles? They abandon them with the best possible grace. They only ask that our doctrine, which they acknowledge to be true, should be confined to books; and that their principles, which they allow to be false, should be established in practice. If we will give up to them the regulation of our tariffs, they will leave us triumphant in the domain of theory.

"Assuredly," said Mr. Gauthier de Roumilly, lately, "assuredly no one wishes to call up from their graves the defunct theories of the balance of trade." And yet Mr. Gauthier, after giving this passing blow to error, goes on immediately afterwards, and for two hours consecutively, to reason as though this error were a truth.

Give me Mr. Lestiboudois. Here we have a consistent reasoner! a logical arguer! There is nothing in his conclusions which cannot be found in his premises. He asks nothing in practice which he does not justify in theory. His principles may perchance be false, and this is the point in question. But he has a principle. He believes, he proclaims aloud, that if France gives ten to receive fifteen, she loses five; and surely, with such a belief, nothing is more natural than that he should make laws consistent with it.

He says: "What it is important to remark, is, that constantly the amount of importation is augmenting, and surpassing that of exportation. Every year France buys more foreign produce, and sells less of its own produce. This can be proved by figures. In 1842, we see the importation exceed the exportation by two hundred millions. This appears to me to prove, in the clearest manner, that national labor is not sufficiently protected, that we are provided by foreign labor, and that the competition of our rivals oppresses our industry. The law in question, appears to me to be a consecration of the fact, that our political economists have assumed a false position in declaring, that in proportion to produce bought, there is always a corresponding quantity sold. It is evident that purchases may be made, not with the habitual productions of a country, not with its revenue, not with the results of actual labor, but with its capital, with the accumulated savings which should serve for reproduction. A country may spend, dissipate its profits and savings, may impoverish itself, and by the consumption of its national capital, progress gradually to its ruin. This is precisely what we are doing. We give, every year, two hundred millions to foreign nations."

Well! here, at least, is a man whom we can understand. There is no hypocrisy in this language. The balance of trade is here clearly maintained and defended. France imports two hundred millions more than she exports. Then France loses two hundred millions yearly. And the remedy? It is to check importation. The conclusion is perfectly consistent.

It is, then, with Mr. Lestiboudois that we will argue, for how is it possible to do so with Mr. Gauthier? If you say to the latter, the balance of trade is a mistake, he will answer, So I have declared it in my exordium. If you exclaim, But it is a truth, he will say, Thus I have classed it in my conclusions.

Political economists may blame me for arguing with Mr. Lestiboudois. To combat the balance of trade, is, they say, neither more nor less than to fight against a windmill.

But let us be on our guard. The balance of trade is neither so old, nor so sick, nor so dead, as Mr. Gauthier is pleased to imagine; for all the legislature, Mr. Gauthier himself included, are associated by their votes with the theory of Mr. Lestiboudois.

However, not to fatigue the reader, I will not seek to investigate too closely this theory, but will content myself with subjecting it to the experience of facts.

It is constantly alleged in opposition to our principles, that they are good only in theory. But, gentlemen, do you believe that merchants' books are good in practice? It does appear to me that if there is any thing which can have a practical authority, when the object is to prove profit and loss, that this must be commercial accounts. We cannot suppose that all the merchants of the world, for centuries back, should have so little understood their own affairs, as to have kept their books in such a manner as to represent gains as losses, and losses as gains. Truly it would be easier to believe that Mr. Lestiboudois is a bad political economist.

A merchant, one of my friends, having had two business transactions, with very different results, I have been curious to compare on this subject the accounts of the counter with those of the custom-house, interpreted by Mr. Lestiboudois with the sanction of our six hundred legislators.

Mr. T... despatched from Havre a vessel, freighted, for the United States, with French merchandise, principally Parisian articles, valued at 200,000 francs. Such was the amount entered at the custom-house. The cargo, on its arrival at New Orleans, had paid ten per cent. expenses, and was liable to thirty per cent. duties; which raised its value to 280,000 francs. It was sold at twenty per cent. profit on its original value, which being 40,000 francs, the price of sale was 320,000 francs, which the assignee converted into cotton. This cotton, again, had to pay for expenses of transportation, insurance, commissions, etc., ten per cent.: so that when the return cargo arrived at Havre, its value had risen to 352,000 francs, and it was thus entered at the custom-house. Finally, Mr. T... realized again on this return cargo twenty per cent. profits; amounting to 70,400 francs. The cotton thus sold for the sum of 422,400 francs.

If Mr. Lestiboudois requires it, I will send him an extract from the books of Mr. T... He will there see, credited to the account of profit and loss, that is to say, set down as gained, two sums; the one of 40,000, the other of 70,000 francs, and Mr. T ... feels perfectly certain that as regards these, there is no mistake in his accounts.

Now what conclusion does Mr. Lestiboudois draw from the sums entered into the custom-house, in this operation? He thence learns that France has exported 200,000 francs, and imported 352,000; from whence the honorable deputy concludes "that she has spent, dissipated the profits of her previous savings; that she is impoverishing herself and progressing to her ruin; and that she has squandered on a foreign nation 152,000 francs of her capital."

Some time after this transaction, Mr. T... despatched another vessel, again freighted with domestic produce, to the amount of 200,000 francs. But the vessel foundered after leaving the port, and Mr. T ... had only farther to inscribe on his books two little items, thus worded:

"Sundries due to X, 200,000 francs, for purchase of divers articles despatched by vessel N.

"Profit and loss due to sundries, 200,000 francs, for final and total loss of cargo."

In the meantime the custom-house inscribed 200,000 francs upon its list of exportations, and as there can of course be nothing to balance this entry on the list of importations, it hence follows that Mr. Lestiboudois and the Chamber must see in this wreck a clear profit to France of 200,000 francs.

We may draw hence yet another conclusion, viz.: that according to the Balance of Trade theory, France has an exceedingly simple manner of constantly doubling her capital. It is only necessary, to accomplish this, that she should, after entering into the custom-house her articles for exportation, cause them to be thrown into the sea. By this course, her exportations can speedily be made to equal her capital; importations will be nothing, and our gain will be, all which the ocean will have swallowed up.

You are joking, the protectionists will reply. You know that it is impossible that we should utter such absurdities. Nevertheless, I answer, you do utter them, and what is more, you give them life, you exercise them practically upon your fellow citizens, as much, at least, as is in your power to do.

The truth is, that the theory of the Balance of Trade should be precisely reversed. The profits accruing to the nation from any foreign commerce should be calculated by the overplus of the importation above the exportation. This overplus, after the deduction of expenses, is the real gain. Here we have the true theory, and it is one which leads directly to freedom in trade. I now, gentlemen, abandon you this theory, as I have done all those of the preceding chapters. Do with it as you please, exaggerate it as you will; it has nothing to fear. Push it to the farthest extreme; imagine, if it so please you, that foreign nations should inundate us with useful produce of every description, and ask nothing in return; that our importations should be infinite, and our exportations nothing. Imagine all this, and still I defy you to prove that we will be the poorer in consequence.



VII.

PETITION FROM THE MANUFACTURERS OF CANDLES, WAX-LIGHTS, LAMPS, CHANDELIERS, REFLECTORS, SNUFFERS, EXTINGUISHERS; AND FROM THE PRODUCERS OF TALLOW, OIL, RESIN, ALCOHOL, AND GENERALLY OF EVERY THING USED FOR LIGHTS.

To the Honorable the Members of the Chamber of Deputies:

"GENTLEMEN,—You are in the right way: you reject abstract theories; abundance, cheapness, concerns you little. You are entirely occupied with the interest of the producer, whom you are anxious to free from foreign competition. In a word, you wish to secure the national market to national labor.

"We come now to offer you an admirable opportunity for the application of your——what shall we say? your theory? no, nothing is more deceiving than theory;—your doctrine? your system? your principle? But you do not like doctrines; you hold systems in horror; and, as for principles, you declare that there are no such things in political economy. We will say then, your practice; your practice without theory, and without principle.

"We are subjected to the intolerable competition of a foreign rival, who enjoys, it would seem, such superior facilities for the production of light, that he is enabled to inundate our national market at so exceedingly reduced a price, that, the moment he makes his appearance, he draws off all custom from us; and thus an important branch of French industry, with all its innumerable ramifications, is suddenly reduced to a state of complete stagnation. This rival, who is no other than the sun, carries on so bitter a war against us, that we have every reason to believe that he has been excited to this course by our perfidious neighbor England. (Good diplomacy this, for the present time!) In this belief we are confirmed by the fact that in all his transactions with this proud island, he is much more moderate and careful than with us.

"Our petition is, that it would please your honorable body to pass a law whereby shall be directed the shutting up of all windows, dormers, sky-lights, shutters, curtains, vasistas, oeil-de-boeufs, in a word, all openings, holes, chinks and fissures through which the light of the sun is used to penetrate into our dwellings, to the prejudice of the profitable manufactures which we flatter ourselves we have been enabled to bestow upon the country; which country cannot, therefore, without ingratitude, leave us now to struggle unprotected through so unequal a contest.

"We pray your honorable body not to mistake our petition for a satire, nor to repulse us without at least hearing the reasons which we have to advance in its favor.

"And first, if, by shutting out as much as possible all access to natural light, you thus create the necessity for artificial light, is there in France an industrial pursuit which will not, through some connection with this important object, be benefited by it?

"If more tallow be consumed, there will arise a necessity for an increase of cattle and sheep. Thus artificial meadows must be in greater demand; and meat, wool, leather, and above all, manure, this basis of agricultural riches, must become more abundant.

"If more oil be consumed, it will cause an increase in the cultivation of the olive-tree. This plant, luxuriant and exhausting to the soil, will come in good time to profit by the increased fertility which the raising of cattle will have communicated to our fields.

"Our heaths will become covered with resinous trees. Numerous swarms of bees will gather upon our mountains the perfumed treasures, which are now cast upon the winds, useless as the blossoms from which they emanate. There is, in short, no branch of agriculture which would not be greatly developed by the granting of our petition.

"Navigation would equally profit. Thousands of vessels would soon be employed in the whale fisheries, and thence would arise a navy capable of sustaining the honor of France, and of responding to the patriotic sentiments of the undersigned petitioners, candle merchants, etc.

"But what words can express the magnificence which Paris will then exhibit! Cast an eye upon the future and behold the gildings, the bronzes, the magnificent crystal chandeliers, lamps, reflectors and candelabras, which will glitter in the spacious stores, compared with which the splendor of the present day will appear trifling and insignificant.

"There is none, not even the poor manufacturer of resin in the midst of his pine forests, nor the miserable miner in his dark dwelling, but who would enjoy an increase of salary and of comforts.

"Gentlemen, if you will be pleased to reflect, you cannot fail to be convinced that there is perhaps not one Frenchman, from the opulent stockholder of Anzin down to the poorest vendor of matches, who is not interested in the success of our petition.

"We foresee your objections, gentlemen; but there is not one that you can oppose to us which you will not be obliged to gather from the works of the partisans of free trade. We dare challenge you to pronounce one word against our petition, which is not equally opposed to your own practice and the principle which guides your policy.

"Do you tell us, that if we gain by this protection, France will not gain, because the consumer must pay the price of it?

"We answer you:

"You have no longer any right to cite the interest of the consumer. For whenever this has been found to compete with that of the producer, you have invariably sacrificed the first. You have done this to encourage labor, to increase the demand for labor. The same reason should now induce you to act in the same manner.

"You have yourselves already answered the objection. When you were told: The consumer is interested in the free introduction of iron, coal, corn, wheat, cloths, etc., your answer was: Yes, but the producer is interested in their exclusion. Thus, also, if the consumer is interested in the admission of light, we, the producers, pray for its interdiction.

"You have also said, the producer and the consumer are one. If the manufacturer gains by protection, he will cause the agriculturist to gain also; if agriculture prospers, it opens a market for manufactured goods. Thus we, if you confer upon us the monopoly of furnishing light during the day, will as a first consequence buy large quantities of tallow, coals, oil, resin, wax, alcohol, silver, iron, bronze, crystal, for the supply of our business; and then we and our numerous contractors having become rich, our consumption will be great, and will become a means of contributing to the comfort and competency of the workers in every branch of national labor.

"Will you say that the light of the sun is a gratuitous gift, and that to repulse gratuitous gifts, is to repulse riches under pretence of encouraging the means of obtaining them?

"Take care,—you carry the death-blow to your own policy. Remember that hitherto you have always repulsed foreign produce, because it was an approach to a gratuitous gift, and the more in proportion as this approach was more close. You have, in obeying the wishes of other monopolists, acted only from a half-motive; to grant our petition there is a much fuller inducement. To repulse us, precisely for the reason that our case is a more complete one than any which have preceded it, would be to lay down the following equation: + x + =-; in other words, it would be to accumulate absurdity upon absurdity.

"Labor and Nature concur in different proportions, according to country and climate, in every article of production. The portion of Nature is always gratuitous; that of labor alone regulates the price.

"If a Lisbon orange can be sold at half the price of a Parisian one, it is because a natural and gratuitous heat does for the one, what the other only obtains from an artificial and consequently expensive one.

"When, therefore, we purchase a Portuguese orange, we may say that we obtain it half gratuitously and half by the right of labor; in other words, at half price compared to those of Paris.

"Now it is precisely on account of this demi-gratuity (excuse the word) that you argue in favor of exclusion. How, you say, could national labor sustain the competition of foreign labor, when the first has every thing to do, and the last is rid of half the trouble, the sun taking the rest of the business upon himself? If then the demi-gratuity can determine you to check competition, on what principle can the entire gratuity be alleged as a reason for admitting it? You are no logicians if, refusing the demi-gratuity as hurtful to human labor, you do not a fortiori, and with double zeal, reject the full gratuity.

"Again, when any article, as coal, iron, cheese, or cloth, comes to us from foreign countries with less labor than if we produced it ourselves, the difference in price is a gratuitous gift conferred upon us; and the gift is more or less considerable, according as the difference is greater or less. It is the quarter, the half, or the three-quarters of the value of the produce, in proportion as the foreign merchant requires the three-quarters, the half, or the quarter of the price. It is as complete as possible when the producer offers, as the sun does with light, the whole in free gift. The question is, and we put it formally, whether you wish for France the benefit of gratuitous consumption, or the supposed advantages of laborious production. Choose, but be consistent. And does it not argue the greatest inconsistency to check as you do the importation of coal, iron, cheese, and goods of foreign manufacture, merely because and even in proportion as their price approaches zero, while at the same time you freely admit, and without limitation, the light of the sun, whose price is during the whole day at zero?"



VIII.

DISCRIMINATING DUTIES.

A poor laborer of Gironde had raised, with the greatest possible care and attention, a nursery of vines, from which, after much labor, he at last succeeded in producing a pipe of wine, and forgot, in the joy of his success, that each drop of this precious nectar had cost a drop of sweat to his brow. I will sell it, said he to his wife, and with the proceeds I will buy thread, which will serve you to make a trousseau for our daughter. The honest countryman, arriving in the city, there met an Englishman and a Belgian. The Belgian said to him, Give me your wine, and I in exchange, will give you fifteen bundles of thread. The Englishman said, Give it to me, and I will give you twenty bundles, for we English can spin cheaper than the Belgians. But a custom-house officer standing by, said to the laborer, My good fellow, make your exchange, if you choose, with the Belgian, but it is my duty to prevent your doing so with the Englishman. What! exclaimed the countryman, you wish me to take fifteen bundles of Brussels thread, when I can have twenty from Manchester? Certainly; do you not see that France would be a loser, if you were to receive twenty bundles instead of fifteen? I can scarcely understand this, said the laborer. Nor can I explain it, said the custom-house officer, but there is no doubt of the fact; for deputies, ministers, and editors, all agree that a people is impoverished in proportion as it receives a large compensation for any given quantity of its produce. The countryman was obliged to conclude his bargain with the Belgian. His daughter received but three-fourths of her trousseau; and these good folks are still puzzling themselves to discover how it can happen that people are ruined by receiving four instead of three; and why they are richer with three dozen towels instead of four.



IX.

WONDERFUL DISCOVERY!

At this moment, when all minds are occupied in endeavoring to discover the most economical means of transportation; when, to put these means into practice, we are leveling roads, improving rivers, perfecting steamboats, establishing railroads, and attempting various systems of traction, atmospheric, hydraulic, pneumatic, electric, etc.,—at this moment when, I believe, every one is seeking in sincerity and with ardor the solution of this problem—

"To bring the price of things in their place of consumption, as near as possible to their price in that of production"—

I would believe myself acting a culpable part towards my country, towards the age in which I live, and towards myself, if I were longer to keep secret the wonderful discovery which I have just made.

I am well aware that the self-illusions of inventors have become proverbial, but I have, nevertheless, the most complete certainty of having discovered an infallible means of bringing the produce of the entire world into France, and reciprocally to transport ours, with a very important reduction of price.

Infallible! and yet this is but a single one of the advantages of my astonishing invention, which requires neither plans nor devices, neither preparatory studies, nor engineers, nor machinists, nor capital, nor stockholders, nor governmental assistance! There is no danger of shipwrecks, of explosions, of shocks, of fire, nor of displacement of rails! It can be put into practice without preparation from one day to another!

Finally, and this will, no doubt, recommend it to the public, it will not increase taxes one cent; but the contrary. It will not augment the number of government functionaries, nor the exigencies of government officers; but the contrary. It will put in hazard the liberty of no one; but the contrary.

I have been led to this discovery not from accident, but observation, and I will tell you how.

I had this question to determine:

"Why does any article made, for instance, at Brussels, bear an increased price on its arrival at Paris?"

It was immediately evident to me that this was the result of obstacles of various kinds existing between Brussels and Paris. First, there is distance, which cannot be overcome without trouble and loss of time; and either we must submit to these in our own person, or pay another for bearing them for us. Then come rivers, swamps, accidents, heavy and muddy roads; these are so many difficulties to be overcome; in order to do which, causeways are constructed, bridges built, roads cut and paved, railroads established, etc. But all this is costly, and the article transported must bear its portion of the expense. There are robbers, too, on the roads, and this necessitates guards, a police, etc.

Now, among these obstacles, there is one which we ourselves have placed, and that at no little expense, between Brussels and Paris. This consists of men planted along the frontier, armed to the teeth, whose business it is to place difficulties in the way of the transportation of goods from one country to another. These men are called custom-house officers, and their effect is precisely similar to that of steep and boggy roads. They retard and put obstacles in the way of transportation, thus contributing to the difference which we have remarked between the price of production and that of consumption; to diminish which difference as much as possible, is the problem which we are seeking to resolve.

Here, then, we have found its solution. Let our tariff be diminished. We will thus have constructed a Northern Railroad which will cost us nothing. Nay, more, we will be saved great expenses, and will begin from the first day to save capital.

Really, I cannot but ask myself, in surprise, how our brains could have admitted so whimsical a piece of folly, as to induce us to pay many millions to destroy the natural obstacles interposed between France and other nations, only at the same time to pay so many millions more in order to replace them by artificial obstacles, which have exactly the same effect; so that the obstacle removed, and the obstacle created, neutralize each other; things go on as before, and the only result of our trouble, is, a double expense.

An article of Belgian production is worth at Brussels twenty francs, and, from the expenses of transportation, thirty francs at Paris. A similar article of Parisian manufacture costs forty francs. What is our course under these circumstances?

First, we impose a duty of at least ten francs on the Belgian article, so as to raise its price to a level with that of the Parisian; the government withal, paying numerous officials to attend to the levying of this duty. The article thus pays ten francs for transportation, ten for the tax.

This done, we say to ourselves: Transportation between Brussels and Paris is very dear; let us spend two or three millions in railways, and we will reduce it one-half. Evidently the result of such a course will be to get the Belgian article at Paris for thirty-five francs, viz:

20 francs—price at Brussels. 10 " duty. 5 " transportation by railroad. — 35 francs—total, or market price at Paris.

Could we not have attained the same end by lowering the tariff to five francs? We would then have—

20 francs—price at Brussels. 5 " duty. 10 " transportation on the common road. — 35 francs—total, or market price at Paris.

And this arrangement would have saved us the 200,000,000 spent upon the railroad, besides the expense saved in custom-house surveillance, which would of course diminish in proportion as the temptation to smuggling would become less.

But it is answered, the duty is necessary to protect Parisian industry. So be it; but do not then destroy the effect of it by your railroad.

For if you persist in your determination to keep the Belgian article on a par with the Parisian at forty francs, you must raise the duty to fifteen francs, in order to have:—

20 francs—price at Brussels. 15 " protective duty. 5 " transportation by railroad. — 40 francs—total, at equalized prices.

And I now ask, of what benefit, under these circumstances, is the railroad?

Frankly, is it not humiliating to the nineteenth century, that it should be destined to transmit to future ages the example of such puerilities seriously and gravely practiced? To be the dupe of another, is bad enough; but to employ all the forms and ceremonies of legislation in order to cheat one's self,—to doubly cheat one's self, and that too in a mere mathematical account,—truly this is calculated to lower a little the pride of this enlightened age.



X.

RECIPROCITY.

We have just seen that all which renders transportation difficult, acts in the same manner as protection; or, if the expression be preferred, that protection tends towards the same result as obstacles to transportation.

A tariff may then be truly spoken of, as a swamp, a rut, a steep hill; in a word, an obstacle, whose effect is to augment the difference between the price of consumption and that of production. It is equally incontestable that a swamp, a bog, etc., are veritable protective tariffs.

There are people (few in number, it is true, but such there are) who begin to understand that obstacles are not the less obstacles, because they are artificially created, and that our well-being is more advanced by freedom of trade than by protection; precisely as a canal is more desirable than a sandy, hilly, and difficult road.

But they still say, this liberty ought to be reciprocal. If we take off our taxes in favor of Spain, while Spain does not do the same towards us, it is evident that we are duped. Let us then make treaties of commerce upon the basis of a just reciprocity; let us yield where we are yielded to; let us make the sacrifice of buying that we may obtain the advantage of selling.

Persons who reason thus, are (I am sorry to say), whether they know it or not, governed by the protectionist principle. They are only a little more inconsistent than the pure protectionists, as these are more inconsistent than the absolute prohibitionists.

I will illustrate this by a fable.

STULTA AND PUERA (FOOL-TOWN AND BOY-TOWN).

There were, it matters not where, two towns, Stulta and Puera, which at great expense had a road built which connected them with each other. Some time after this was done, the inhabitants of Stulta became uneasy, and said: Puera is overwhelming us with its productions; this must be attended to. They established therefore a corps of Obstructors, so called because their business was to place obstacles in the way of the wagon trains which arrived from Puera. Soon after, Puera also established a corps of Obstructors.

After some centuries, people having become more enlightened, the inhabitants of Puera began to discover that these reciprocal obstacles might possibly be reciprocal injuries. They sent therefore an ambassador to Stulta, who (passing over the official phraseology) spoke much to this effect: "We have built a road, and now we put obstacles in the way of this road. This is absurd. It would have been far better to have left things in their original position, for then we would not have been put to the expense of building our road, and afterwards of creating difficulties. In the name of Puera, I come to propose to you, not to renounce at once our system of mutual obstacles, for this would be acting according to a theory, and we despise theories as much as you do; but to lighten somewhat these obstacles, weighing at the same time carefully our respective sacrifices." The ambassador having thus spoken, the town of Stulta asked time to reflect; manufacturers, agriculturists were consulted; and at last, after some years' deliberation, it was declared that the negotiations were broken off.

At this news, the inhabitants of Puera held a council. An old man (who it has always been supposed had been secretly bribed by Stulta) rose and said: "The obstacles raised by Stulta are injurious to our sales; this is a misfortune. Those which we ourselves create, injure our purchases; this is a second misfortune. We have no power over the first, but the second is entirely dependent upon ourselves. Let us then at least get rid of one, since we cannot be delivered from both. Let us suppress our corps of Obstructors, without waiting for Stulta to do the same. Some day or other she will learn to understand better her own interests."

A second counselor, a man of practice and of facts, uncontrolled by theories and wise in ancestral experience, replied: "We must not listen to this dreamer, this theorist, this innovator, this utopian, this political economist, this friend to Stulta. We would be entirely ruined if the embarrassments of the road were not carefully weighed and exactly equalized, between Stulta and Peura. There would be more difficulty in going than in coming; in exportation than in importation. We would be, with regard to Stulta, in the inferior condition in which Havre, Nantes, Bordeaux, Lisbon, London, Hamburg, and New Orleans, are, in relation to cities placed higher up the rivers Seine, Loire, Garonne, Tagus, Thames, the Elbe, and the Mississippi; for the difficulties of ascending must always be greater than those of descending rivers. (A voice exclaims: 'But the cities near the mouths of rivers have always prospered more than those higher up the stream.') This is not possible. (The same voice: 'But it is a fact.') Well, they have then prospered contrary to rule." Such conclusive reasoning staggered the assembly. The orator went on to convince them thoroughly and conclusively by speaking of national independence, national honor, national dignity, national labor, overwhelming importation, tributes, ruinous competition. In short, he succeeded in determining the assembly to continue their system of obstacles, and I can now point out a certain country where you may see road-builders and Obstructors working with the best possible understanding, by the decree of the same legislative assembly, paid by the same citizens; the first to improve the road, the last to embarrass it.



XI.

ABSOLUTE PRICES.

If we wish to judge between freedom of trade and protection, to calculate the probable effect of any political phenomenon, we should notice how far its influence tends to the production of abundance or scarcity, and not simply of cheapness or dearness of price. We must beware of trusting to absolute prices, it would lead to inextricable confusion.

Mr. Mathieu de Dombasle, after having established the fact that protection raises prices, adds:

"The augmentation of price increases the expenses of life, and consequently the price of labor, and every one finds in the increase of the price of his produce the same proportion as in the increase of his expenses. Thus, if every body pays as consumer, every body receives also as producer."

It is evident that it would be easy to reverse the argument and say: If every body receives as producer, every body must pay as consumer.

Now, what does this prove? Nothing whatever, unless it be that protection transfers riches, uselessly and unjustly. Robbery does the same.

Again, to prove that the complicated arrangements of this system give even simple compensation, it is necessary to adhere to the "consequently" of Mr. de Dombasle, and to convince one's self that the price of labor rises with that of the articles protected. This is a question of fact, which I refer to Mr. Moreau de Jonnes, begging him to examine whether the rate of wages was found to increase with the stock of the mines of Anzin. For my own part I do not believe in it, because I think that the price of labor, like every thing else, is governed by the proportion existing between the supply and the demand. Now I can perfectly well understand that restriction will diminish the supply of coal, and consequently raise its price; but I do not as clearly see that it increases the demand for labor, thereby raising the rate of wages. This is the less conceivable to me, because the sum of labor required depends upon the quantity of disposable capital; and protection, while it may change the direction of capital, and transfer it from one business to another, cannot increase it one penny.

This question, which is of the highest interest, we will examine elsewhere. I return to the discussion of absolute prices, and declare that there is no absurdity which cannot be rendered specious by such reasoning as that of Mr. de Dombasle.

Imagine an isolated nation possessing a given quantity of cash, and every year wantonly burning the half of its produce. I will undertake to prove by the theory of Mr. de Dombasle that this nation will not be the less rich in consequence of such a procedure.

For, the result of the conflagration must be, that every thing would double in price. An inventory made before this event would offer exactly the same nominal value, as one made after it. Who then would be the loser? If John buys his cloth dearer, he also sells his corn at a higher price; and if Peter makes a loss on the purchase of his corn, he gains it back by the sale of his cloth. Thus "every one finds in the increase of the price of his produce, the same proportion as in the increase of his expenses; and thus if every body pays as consumer, every body also receives as producer."

All this is nonsense. The simple truth is: that whether men destroy their corn and cloth by fire or by use, the effect is the same as regards price, but not as regards riches, for it is precisely in the enjoyment of the use, that riches—in other words, comfort, well-being—exist.

Protection may, in the same way, while it lessens the abundance of things, raise their prices, so as to leave each individual as rich, numerically speaking, as when unembarrassed by it. But because we put down in an inventory three hectolitres of corn at 20 francs, or four hectolitres at 15 francs, and sum up the nominal value of each at 60 francs, does it thence follow that they are equally capable of contributing to the necessities of the community?

To this view of consumption, it will be my continual endeavor to lead the protectionists; for in this is the end of all my efforts, the solution of every problem. I must continually repeat to them that restriction, by impeding commerce, by limiting the division of labor, by forcing it to combat difficulties of situation and temperature, must in its results diminish the quantity produced by any fixed quantum of labor. And what can it benefit us that the smaller quantity produced under the protective system bears the same nominal value as the greater quantity produced under the free trade system? Man does not live on nominal values, but on real articles of produce; and the more abundant these articles are, no matter what price they may bear, the richer is he.



XII.

DOES PROTECTION RAISE THE RATE OF WAGES?

Workmen, your situation is singular! you are robbed, as I will presently prove to you.... But no; I retract the word; we must avoid an expression which is violent; perhaps indeed incorrect; inasmuch as this spoliation, wrapped in the sophisms which disguise it, is practiced, we must believe, without the intention of the spoiler, and with the consent of the spoiled. But it is nevertheless true that you are deprived of the just compensation of your labor, while no one thinks of causing justice to be rendered to you. If you could be consoled by noisy appeals to philanthropy, to powerless charity, to degrading alms-giving, or if high-sounding words would relieve you, these indeed you can have in abundance. But justice, simple justice—nobody thinks of rendering you this. For would it not be just that after a long day's labor, when you have received your little wages, you should be permitted to exchange them for the largest possible sum of comforts that you can obtain voluntarily from any man whatsoever upon the face of the earth?

Let us examine if injustice is not done to you, by the legislative limitation of the persons from whom you are allowed to buy those things which you need; as bread, meat, cotton and woolen cloths, etc.; thus fixing (so to express myself) the artificial price which these articles must bear.

Is it true that protection, which avowedly raises prices, and thus injures you, raises proportionably the rate of wages?

On what does the rate of wages depend?

One of your own class has energetically said: "When two workmen run after a master, wages fall; when two masters run after a workman, wages rise."

Allow me, in more laconic phrase, to employ a more scientific, though perhaps a less striking expression: "The rate of wages depends upon the proportion which the supply of labor bears to the demand."

On what depends the demand for labor?

On the quantity of disposable national capital. And the law which says, "such or such an article shall be limited to home production and no longer imported from foreign countries," can it in any degree increase this capital? Not in the least. This law may withdraw it from one course, and transfer it to another; but cannot increase it one penny. Then it cannot increase the demand for labor.

While we point with pride to some prosperous manufacture, can we answer, from whence comes the capital with which it is founded and maintained? Has it fallen from the moon? or rather is it not drawn either from agriculture, or navigation, or other industry? We here see why, since the reign of protective tariffs, if we see more workmen in our mines and our manufacturing towns, we find also fewer sailors in our ports, and fewer laborers and vine-growers in our fields and upon our hillsides.

I could speak at great length upon this subject, but prefer illustrating my thought by an example.

A countryman had twenty acres of land, with a capital of 10,000 francs. He divided his land into four parts, and adopted for it the following changes of crops: 1st, maize; 2d, wheat; 3d, clover; and 4th, rye. As he needed for himself and family but a small portion of the grain, meat, and dairy-produce of the farm, he sold the surplus and bought oil, flax, wine, etc. The whole of his capital was yearly distributed in wages and payments of accounts to the workmen of the neighborhood. This capital was, from his sales, again returned to him, and even increased from year to year. Our countryman, being fully convinced that idle capital produces nothing, caused to circulate among the working classes this annual increase, which he devoted to the inclosing and clearing of lands, or to improvements in his farming utensils and his buildings. He deposited some sums in reserve in the hands of a neighboring banker, who on his part did not leave these idle in his strong box, but lent them to various tradesmen, so that the whole came to be usefully employed in the payment of wages.

The countryman died, and his son, become master of the inheritance, said to himself: "It must be confessed that my father has, all his life, allowed himself to be duped. He bought oil, and thus paid tribute to Province, while our own land could, by an effort, be made to produce olives. He bought wine, flax, and oranges, thus paying tribute to Brittany, Medoc, and the Hiera islands very unnecessarily, for wine, flax and oranges may be forced to grow upon our own lands. He paid tribute to the miller and the weaver; our own servants could very well weave our linen, and crush our wheat between two stones. He did all he could to ruin himself, and gave to strangers what ought to have been kept for the benefit of his own household."

Full of this reasoning, our headstrong fellow determined to change the routine of his crops. He divided his farm into twenty parts. On one he cultivated the olive; on another the mulberry; on a third flax; he devoted the fourth to vines, the fifth to wheat, etc., etc. Thus he succeeded in rendering himself independent, and furnished all his family supplies from his own farm. He no longer received any thing from the general circulation; neither, it is true, did he cast any thing into it. Was he the richer for this course? No, for his land did not suit the cultivation of the vine; nor was the climate favorable to the olive. In short, the family supply of all these articles was very inferior to what it had been during the time when the father had obtained them all by exchange of produce.

With regard to the demand for labor, it certainly was no greater than formerly. There were, to be sure, five times as many fields to cultivate, but they were five times smaller. If oil was raised, there was less wheat; and because there was no more flax bought, neither was there any more rye sold. Besides, the farmer could not spend in wages more than his capital, and his capital, instead of increasing, was now constantly diminishing. A great part of it was necessarily devoted to numerous buildings and utensils, indispensable to a person who determines to undertake every thing. In short, the supply of labor continued the same, but the means of paying becoming less, there was, necessarily, a reduction of wages.

The result is precisely similar, when a nation isolates itself by the prohibitive system. Its number of industrial pursuits is certainly multiplied, but their importance is diminished. In proportion to their number, they become less productive, for the same capital and the same skill are obliged to meet a greater number of difficulties. The fixed capital absorbs a greater part of the circulating capital; that is to say, a greater part of the funds destined to the payment of wages. What remains, ramifies itself in vain, the quantity cannot be augmented. It is like the water of a pond, which, distributed in a multitude of reservoirs, appears to be more abundant, because it covers a greater quantity of soil, and presents a larger surface to the sun, while we hardly perceive that, precisely on this account, it absorbs, evaporates, and loses itself the quicker.

Capital and labor being given, the result is, a sum of production, always the less great, in proportion as obstacles are numerous. There can be no doubt that protective tariffs, by forcing capital and labor to struggle against greater difficulties of soil and climate, must cause the general production to be less, or, in other words, diminish the portion of comforts which would thence result to mankind. If, then, there be a general diminution of comforts, how, workmen, can it be possible that your portion should be increased? Under such a supposition, it would be necessary to believe that the rich, those who made the law, have so arranged matters, that not only they subject themselves to their own proportion of the general loss, but taking the whole of it upon themselves, that they submit also to a further loss, in order to increase your gains. Is this credible? Is this possible? It is, indeed, a most suspicious act of generosity, and if you act wisely, you will reject it.



XIII.

THEORY—PRACTICE.

Partisans of free trade, we are accused of being theorists, and not relying sufficiently upon practice.

What a powerful argument against Mr. Say (says Mr. Ferrier,) is the long succession of distinguished ministers, the imposing league of writers who have all differed from him; and Mr. Say is himself conscious of this, for he says: "It has been said, in support of old errors, that there must necessarily be some foundation for ideas so generally adopted by all nations. Ought we not, it is asked, to distrust observations and reasoning which run counter to every thing which has been looked upon as certain up to this day, and which has been regarded as undoubted by so many who were to be confided in, alike on account of their learning and of their philanthropic intentions? This argument is, I confess, calculated to make a profound impression, and might cast a doubt upon the most incontestable facts, if the world had not seen so many opinions, now universally recognized as false, as universally maintain, during a long series of ages, their dominion over the human mind. The day is not long passed since all nations, from the most ignorant to the most enlightened, and all men, the wisest as well as the most uninformed, admitted only four elements. Nobody dreamed of disputing this doctrine, which is, nevertheless, false, and to-day universally decried."

Upon this passage Mr. Ferrier makes the following remarks:

"Mr. Say is strangely mistaken, if he believes that he has thus answered the very strong objections which he has himself advanced. It is natural enough that, for ages, men otherwise well informed, might mistake upon a question of natural history; this proves nothing. Water, air, earth, and fire, elements or not, were not the less useful to man.... Such errors as this are of no importance. They do not lead to revolutions, nor do they cause mental uneasiness; above all, they clash with no interests, and might, therefore, without inconvenience, last for millions of years. The physical world progresses as though they did not exist. But can it be thus with errors which affect the moral world? Can it be conceived that a system of government absolutely false, consequently injurious, could be followed for many centuries, and among many nations, with the general consent of well-informed men? Can it be explained how such a system could be connected with the constantly increasing prosperity of these nations? Mr. Say confesses that the argument which he combats is calculated to make a profound impression. Most certainly it is; and this impression remains; for Mr. Say has rather increased than diminished it."

Let us hear Mr. de Saint Chamans.

"It has been only towards the middle of the last, the eighteenth century, when every subject and every principle have without exception been given up to the discussion of book-makers, that these furnishers of speculative ideas, applied to every thing and applicable to nothing, have begun to write upon the subject of political economy. There existed previously a system of political economy, not written, but practiced by governments. Colbert was, it is said, the inventor of it; and Colbert gave the law to every state of Europe. Strange to say, he does so still, in spite of contempt and anathemas, in spite too of the discoveries of the modern school. This system, which has been called by our writers the mercantile system, consisted in ... checking by prohibition or import duties such foreign productions as were calculated to ruin our manufactures by competition.... This system has been declared, by all writers on political economy, of every school,[12] to be weak, absurd, and calculated to impoverish the countries where it prevails. Banished from books, it has taken refuge in the practice of all nations, greatly to the surprise of those who cannot conceive that in what concerns the wealth of nations, governments should, rather than be guided by the wisdom of authors, prefer the long experience of a system, etc.... It is above all inconceivable to them that the French government ... should obstinately resist the new lights of political economy, and maintain in its practice the old errors, pointed out by all our writers.... But I am devoting too much time to this mercantile system, which, unsustained by writers, has only facts in its favor!"

[Footnote 12: Might we not say: It is a powerful argument against Messrs. Ferrier and de Saint Chamans, that all writers on political economy, of every school, that is to say, all men who have studied the question, come to this conclusion: After all, freedom is better than restriction, and the laws of God wiser than those of Mr. Colbert.]

Would it not be supposed from this language that political economists, in claiming for each individual the free disposition of his own property, have, like the Fourierists, stumbled upon some new, strange, and chimerical system of social government, some wild theory, without precedent in the annals of human nature? It does appear to me, that, if in all this there is any thing doubtful, and of fanciful or theoretic origin, it is not free trade, but protection; not the operating of exchanges, but the custom-house, the duties, imposed to overturn artificially the natural order of things.

The question, however, is not here to compare and judge of the merits of the two systems, but simply to know which of the two is sanctioned by experience.

You, Messrs. monopolists, maintain that facts are for you, and that we on our side have only theory.

You even flatter yourselves that this long series of public acts, this old experience of Europe which you invoke, appeared imposing to Mr. Say; and I confess that he has not refuted you, with his habitual sagacity.

I, for my part, cannot consent to give up to you the domain of facts; for while on your side you can advance only limited and special facts, we can oppose to them universal facts, the free and voluntary acts of all men.

What do we maintain? and what do you maintain?

We maintain that "it is best to buy from others what we ourselves can produce only at a higher price."

You maintain that "it is best to make for ourselves, even though it should cost us more than to buy from others."

Now gentlemen, putting aside theory, demonstration, reasoning, (things which seem to nauseate you,) which of these assertions is sanctioned by universal practice?

Visit our fields, workshops, forges, stores; look above, below, and around you; examine what is passing in your own household; observe your own actions at every moment, and say which principle it is, that directs these laborers, workmen, contractors, and merchants; say what is your own personal practice.

Does the agriculturist make his own clothes? Does the tailor produce the grain which he consumes? Does not your housekeeper cease to make her bread at home, as soon as she finds it more economical to buy it from the baker? Do you lay down your pen to take up the blacking-brush in order to avoid paying tribute to the shoe-black? Does not the whole economy of society depend upon a separation of occupations, a division of labor, in a word, upon mutual exchange of production, by which we, one and all, make a calculation which causes us to discontinue direct production, when indirect acquisition offers us a saving of time and labor.

You are not then sustained by practice, since it would be impossible, were you to search the world, to show us a single man who acts according to your principle.

You may answer that you never intended to make your principle the rule of individual relations. You confess that it would thus destroy all social ties, and force men to the isolated life of snails. You only contend that it governs in fact, the relations which are established between the agglomerations of the human family.

We say that this assertion too is erroneous. A family, a town, county, department, province, all are so many agglomerations, which, without any exception, all practically reject your principle; never, indeed, even think of it. Each of these procures by barter, what would be more expensively procured by production. Nations would do the same, did you not by force prevent them.

We, then, are the men who are guided by practice and experience. For to combat the interdict which you have specially put upon some international exchanges, we bring forward the practice and experience of all individuals, and of all agglomerations of individuals, whose acts being voluntary, render them proper to be given as proof in the question. But you, on your part, begin by forcing, by hindering, and then, adducing forced or forbidden acts, you exclaim: "Look; we can prove ourselves justified by example!"

You exclaim against our theory, and even against all theory. But are you certain, in laying down your principles, so antagonistic to ours, that you too are not building up theories? Truly, you too have your theory; but between yours and ours there is this difference:

Our theory is formed upon the observation of universal facts, universal sentiments, universal calculations and acts. We do nothing more than classify and arrange these, in order to better understand them. It is so little opposed to practice, that it is in fact only practice explained. We look upon the actions of men as prompted by the instinct of self-preservation and of progress. What they do freely, willingly,—this is what we call Political Economy, or economy of society. We must repeat constantly that each man is practically an excellent political economist, producing or exchanging, as his advantage dictates. Each by experience raises himself to the science; or rather the science is nothing more than experience, scrupulously observed and methodically expounded.

But your theory is theory in the worst sense of the word. You imagine procedures which are sanctioned by the experience of no living man, and then call to your aid constraint and prohibition. You cannot avoid having recourse to force; because, wishing to make men produce what they can more advantageously buy, you require them to give up an advantage, and to be led by a doctrine which implies contradiction even in its terms.

I defy you too, to take this doctrine, which by your own avowal would be absurd in individual relations, and apply it, even in speculation, to transactions between families, towns, departments, or provinces. You yourselves confess that it is only applicable to internal relations.

Thus it is that you are daily forced to repeat:

"Principles can never be universal. What is well in an individual, a family, commune, or province, is ill in a nation. What is good in detail—for instance: purchase rather than production, where purchase is more advantageous—is bad in a society. The political economy of individuals is not that of nations;" and other such stuff, ejusdem farinae.

And all this for what? To prove to us, that we consumers, we are your property! that we belong to you, soul and body! that you have an exclusive right on our stomachs and our limbs! that it is your right to feed and dress us at your own price, however great your ignorance, your rapacity, or the inferiority of your work.

Truly, then, your system is one not founded upon practice; it is one of abstraction—of extortion.



XIV.

CONFLICTING PRINCIPLES.

There is one thing which embarrasses me not a little; and it is this:

Sincere men, taking upon the subject of political economy the point of view of producers, have arrived at this double formula:

"A government should dispose of consumers subject to its laws in favor of home industry."

"It should subject to its laws foreign consumers, in order to dispose of them in favor of home industry."

The first of the formulas is that of Protection; the second that of Outlets.

Both rest upon this proposition, called the Balance of Trade, that

"A people is impoverished by importations and enriched by exportations."

For if every foreign purchase is a tribute paid, a loss, nothing can be more natural than to restrain, even to prohibit importations.

And if every foreign sale is a tribute received, a gain, nothing more natural than to create outlets, even by force.

Protective System; Colonial System.—These are only two aspects of the same theory. To prevent our citizens from buying from foreigners, and to force foreigners to buy from our citizens. Two consequences of one identical principle.

It is impossible not to perceive that according to this doctrine, if it be true, the welfare of a country depends upon monopoly or domestic spoliation, and upon conquest or foreign spoliation.

Let us take a glance into one of these huts, perched upon the side of our Pyrenean range.

The father of a family has received the little wages of his labor; but his half-naked children are shivering before a biting northern blast, beside a fireless hearth, and an empty table. There is wool, and wood, and corn, on the other side of the mountain, but these are forbidden to them; for the other side of the mountain is not France. Foreign wood must not warm the hearth of the poor shepherd; his children must not taste the bread of Biscay, nor cover their numbed limbs with the wool of Navarre. It is thus that the general good requires!

The disposing by law of consumers, forcing them to the support of home industry, is an encroachment upon their liberty, the forbidding of an action (mutual exchange) which is in no way opposed to morality! In a word, it is an act of injustice.

But this, it is said, is necessary, or else home labor will be arrested, and a severe blow will be given to public prosperity.

Thus then we must come to the melancholy conclusion, that there is a radical incompatibility between the Just and the Useful.

Again, if each people is interested in selling, and not in buying, a violent action and reaction must form the natural state of their mutual relations; for each will seek to force its productions upon all, and all will seek to repulse the productions of each.

A sale in fact implies a purchase, and since, according to this doctrine, to sell is beneficial, and to buy injurious, every international transaction must imply the benefiting of one people by the injuring of another.

But men are invincibly inclined to what they feel to be advantageous to themselves, while they also, instinctively resist that which is injurious. From hence then we must infer that each nation bears within itself a natural force of expansion, and a not less natural force of resistance, which are equally injurious to all others. In other words, antagonism and war are the natural state of human society.

Thus then the theory in discussion resolves itself into the two following axioms. In the affairs of a nation,

Utility is incompatible with the internal administration of justice.

Utility is incompatible with the maintenance of external peace.

Well, what embarrasses and confounds me is, to explain how any writer upon public rights, any statesman who has sincerely adopted a doctrine of which the leading principle is so antagonistic to other incontestable principles, can enjoy one moment's repose or peace of mind.