Frédéric Bastiat is probably the most famous political scientist you’ve never heard of. June 30 marks the 220e anniversary of his birth and, given the recent US embrace of cronyism through tariffs, grants and assignments, we need his wisdom more than ever.
Bastiat lived through the tumultuous cycle of revolutions in France during the first half of the 19th century. He saw first-hand how these upheavals provided ample opportunity for special interest groups to demand privileged treatment in return for supporting the demands of their benefactors to political power.
Bastiat is best known for the way his parables perfectly summarize a critical concept and present it in a relevant way. His style combines the insight of Milton friedman with the humor of Dave barry and PJ O’Rourke.
His best-known essay is “The Candlestick Petition. “In this satire, the lighting industry is asking for protection from the unfair practices of a powerful competitor, the sun. They argue that the sun has a natural advantage in producing light which reduces their sales and, for For reasons of economic growth, regulations should require every window to be covered with bricks.This would increase the demand for candles, lanterns and upstream products needed to produce light, for the benefit of these industries and their workers.
The idea is absurd, but the logic is the same as that used by supporters of the steel and aluminum tariffs created by the Trump administration and maintained by the Biden administration. A tariff, by its very nature, benefits domestic producers by to increase the price that domestic consumers have to pay. You can’t say, “We have to protect American industry!” without simultaneously harming American consumers.
Tariffs have a knock-on effect on the rest of the economy, but the bad outweighs the good. Trump’s – and now Biden – tariffs have increased revenues by a handful of the biggest and most influential companies producing steel and aluminum, but they did not increase employment. The more expensive metals reduced manufacturing output and caused a loss of 75,000 jobs.
The same faulty analysis is displayed in Bastiat’s parable “The broken window. After a child smashes a window, onlookers reassure the hapless owner with the insensitive platitude that, “Accidents like this move production forward. Everyone has to live. What would happen to the glaziers if ever no glass pane?” was not broken? “
Bastiat uses history to illustrate that a bad economist focuses on the obvious effect (“what is seen”), while a good economist studies the indirect effect (“what is to be expected”). But it doesn’t take an economics degree to understand that it would be much better if the resources that now have to be spent on a new window could instead be spent on other goods and services. Just spending money does not create economic growth.
Unfortunately, most economic policies implicitly embrace this cost-conscious perspective. One example is the growing support for the expansion of the federal government industrial policy. In particular, the revival of the military-industrial complex to compete with China in a new cold war will be a gold rush for those who are able to divert government support to their own economic advantage. Their lower cost justification will always be “It will create jobs”.
No discussion of Bastiat’s writings can be complete without mentioning “The lawPerhaps the simplest argument ever written against government interference in people’s lives. The best indicator of perversions of governmental power is whether “the law benefits one citizen to the detriment of another by doing what the citizen himself cannot do without committing a crime”.
This kind of government authorized theft – legal looting, as he calls it – leads to a decline in society as the government transforms into an entity “by which everyone seeks to live at everyone’s expense”. You don’t need to look any further than the recent reincarnation of assignments (in which members of Congress provide billions for their favorite projects, paid for by distant taxpayers who will never benefit) to understand that legal looting is alive and well in the US
The late George Mason University economist Walter Williams, in an introduction to the book, mentionned: “Bastiat’s greatest contribution is that he took the speech out of the ivory tower and made the ideas about freedom so clear that even the illiterate can understand them.”
As we approach America 245e anniversary, let us reconnect with the spirit which animated our Founders, and which inspired Bastiat to write: “Look at the United States. There is no country in the world where the law is more guarded in its own domain: the protection of the liberty and property of each person.
We don’t always live up to this high standard. Neither did we in 1848, as Bastiat recognized when he wrote these words. But things are better today than they were 170 years ago, and if we further limit the government’s ability to loot one person for another, the future will be even brighter.
Michael farren is an associate researcher at the Mercatus Center at George Mason University.