Frédéric Bastiat (1801-1850) merits a hallowed place in the annals of political economy. A member of the French Liberal, or laissez-faire, school of economists that included the great J. B. Say, Bastiat marshaled logic, clarity, and exuberant wit in the cause of understanding society, prosperity, and liberty. In a series of brief essays and pamphlets, and a treatise on political economy, Bastiat taught, contra Rousseau, that there is a natural harmonious order to the social world, an order that emanates from the free exchange between human beings driven to satisfy unlimited wants with limited resources. The result is a steady progress in the material well-being of all. Interference with that freedom, and with its corollaries, property and competition, he wrote, leaves people poorer as well as oppressed. This is so because interference bars individuals from the creative action they otherwise would have engaged in. The fruits of the creativity thus forgone are “what is not seen” in any act of intervention.
Claude Frédéric Bastiat was born in the southwestern French port city of Bayonne. Orphaned at 9, he came of age during the Napoleonic wars, with their extensive government intervention in economic affairs. As a young man, he chose the study of economics over business and farming. The multilingual Bastiat devoured the works of political economists from throughout Europe, with the deepest impressions left by Say, Adam Smith, Destutt de Tracy, and Charles Comte. In 1844 he began his brief writing career, stimulated by the free-trade efforts of Richard Cobden (who would become his close friend) and the Anti-Corn Law League in England. Bastiat first garnered attention with “The Influence of French and English Tariffs on the Future of the Two Peoples,” published in the Journal des Économistes. Thus began his brief torrent of essays and pamphlets deftly exploding the economic fallacies of his day. Two series of those essays were compiled under the title Economic Sophisms (1845), a bestseller that went through many editions and was translated into several languages. In 1850, as his life was nearing an end, Bastiat published The Law, his eloquent foray into political and legal philosophy, and Economic Harmonies, his treatise on political economy. Other works, including Cobden and the League (1845) and Capital and Rent (published posthumously 1873?), have not been translated.
Bastiat was an activist as well as an author. In 1846 he organized the French Free Trade Association in Bordeaux, before moving to Paris where he organized the free-trade effort on a national scale. He served as secretary-general and editor of the weekly newspaper Le Libre Échange (Free Trade).
In the revolutionary year of 1848, the French people, disgusted with monarchical corruption on behalf of special interests, forced their king from power. In the turmoil that followed, socialist and other utopian schemes gained adherents. To combat these ideas, Bastiat, sick from tuberculosis, won a seat in the National Assembly from Landes. His earlier amicable contact with the poet Lamartine had made the future leader of the Second Republic something of a free trader. But when Lamartine endorsed interventionist programs Bastiat publicly opposed him. In the assembly Bastiat fought the socialists and communists, on the one hand, and the monarchists, protectionists, and militarists, on the other. His health failing, he valiantly tried to stave off the barrage of assaults on economic and civil liberties. As France veered toward another revolution in the summer of 1848 (this one aborted), Bastiat, in speech and essay, continued his battle for freedom and against statism.
Bastiat did not live to see the end of the republic and the crowning of Napoleon III. He died in Rome on Christmas Eve of 1850—but not before he wrote volume one and part of volume two of his magnum opus, Economic Harmonies. In his final months he also wrote what would become perhaps his best-known essay, “What Is Seen and What Is Not Seen” (included in Selected Essays on Political Economy). It almost never saw print. Bastiat lost the original manuscript, rewrote it, but was displeased with his effort and burned the second manuscript. Fortunately, he tried again.
Bastiat’s first book, Economic Sophisms, is a collection of short essays showing with unparalleled imagination the fallacy of government intervention. The underlying theme is that when government interferes with peaceful, productive activities, it sets obstacles against the process that improves the well-being of all. The most famous essay in this work is “A Petition,” in which the candlemakers of France petition for relief from the “ruinous competition of a foreign rival who works under conditions so far superior to our own for the production of light that he is flooding the domestic market with it at an incredibly low price.” The rival? The sun. The remedy requested? The mandatory shuttering of all windows. The result promised? The encouragement of not only of the candle industry, but also of all industries that supply it. Bastiat here mocked the multiplier effect long before Keynes was born.
In “The Negative Railroad,” he takes up a suggestion that the railroad from Paris to Spain have a break in the tracks at Bordeaux to profit the businesses there. But what’s good for Bordeaux’s producers is also good for the producers of every town along the line. So why not “a railroad composed of a whole series of breaks in the tracks, i.e., a negative railroad”? Such absurdity, Bastiat writes, is what comes of focusing on the producer and neglecting the consumer in economic analysis. No wonder Henry Hazlitt called him a “master of the reductio ad absurdum” and F.A. Hayek dubbed him a “publicist of genius.”
Bastiat’s The Law, is his venture into explicit political philosophy. In its clarity and brevity it is an achievement to behold. Philosophers have conceived law as resulting from a social contract with a paternalistic sovereign (Thomas Hobbes), as designed to effect the greatest happiness for the greatest number (Jeremy Bentham and the utilitarians), or as an arbitrary convention defining right and wrong (the legal positivists). In contrast, Bastiat is squarely in the natural law camp (along with John Locke): “Life, liberty, and property do not exist because men have made laws. On the contrary, it was the fact that life, liberty, and property existed beforehand that caused men to make laws in the first place.” He locates the source of law in human nature: to live, human beings need liberty and property in order to transform nature’s potential into usable things. Thus law that conflicts with liberty and property is not proper law, but legalized plunder, a constant temptation since men wish to achieve their objectives with the least exertion. The result is moral chaos, oppression, and material deprivation. Bastiat concludes with a call for freedom and a rejection of all proposals to impose unnatural social arrangements on people.
Bastiat moved to the broader examination of the market system as a whole in Economic Harmonies. In it Bastiat methodically builds his theoretical edifice. He begins by recognizing the economic regularity that daily permits Paris to be fed. Remarkably, that regularity is not designed or maintained by any grand master. It results from the acts of countless individuals looking after their own interests. For Bastiat the task of economics is to explain this order produced by that “prodigiously ingenious mechanism”—the free market—which harmonizes the interests of the multitude, enabling each person to enjoy an array of consumer goods no one of them could produce in ten centuries. Bastiat leaves the reader no choice but to marvel at both the market’s complexity and its peerless facility at improving our material circumstances. For him, society is a system of exchange of services founded on self-interest, private property, and free competition, whose rationale is the benefit of consumers.
This stands in contrast to the British economists—notably Adam Smith and David Ricardo—who concentrated on the production of material wealth. It is in the very nature of this system, Bastiat taught, that it requires no central direction; indeed, all attempts at directing it lead to poverty and despair. Bastiat thus left a monumental and eloquent brief against socialism and all other forms of government economic intervention, most famously protectionism. The tour de force covers exchange, value, wealth, capital, land, competition, rent, wages, savings, population, and even that scourge of progress, war. While the work lacks some of the insights achieved later by the subjectivist Austrian school of economics, Bastiat’s picture of the market process is sophisticated and valuable.
Selected Essays on Political Economy, a posthumous collection of essays and pamphlets, contains some of Bastiat’s best writings. Here he debunks, for example, the doctrine of the balance of trade, pointing out that if it is better to export than to import, then best of all would be for ships carrying exports to sink so that no imports may return as a result. Also in this volume is his essay “The State,” which contains the oft-quoted truth, “The state is the great fictitious entity by which everyone seeks to live at the expense of everyone else.”
In “What Is Seen and What Is Not Seen,” Bastiat’s perspicacity and perspicuity are on display. He begins with a story of a boy who has broken a window. An onlooker points out the silver lining of the boy’s mischief: the glazier will earn six francs plying his trade, his industry thus encouraged. To which Bastiat protests, “That will never do! Your theory stops at what is seen. It does not take account of what is not seen.” What is not seen is that had the window not been broken, the six francs would have been available for things that the window-owner must now do without. He is therefore poorer! There is no silver lining. (See pages 12 to 14 in this issue.)
The phenomenon of the unseen has its roots in two of Bastiat’s themes: human wants are unlimited and resources are scarce. As long as nature imposes these conditions, there is no danger of general overproduction. The work to be done is without end. All government interventions designed to create or save jobs, such as tariffs, are obstacles to progress because, by creating or maintaining artificially high prices, they leave consumers less money with which to satisfy other wants. If cheap imported textiles are banned, people are unable to afford other goods the savings would have allowed. As a result, the community is less well off than it would have been.
Throughout his writings, Bastiat dealt with a single question: What sort of economy best promotes human flourishing? As noted above, his answer builds on two facts about the world around us: unlimited wants and scarce resources. Taken together, these conditions imply that a free society, one in which people can use their property as they see fit, is the best society. Only such a society allows people to reconcile their diverse goals and interests through trade—and this trade in turn supports the division of labor, which allows each to prosper to a degree far beyond what any could achieve alone.
To maintain this prosperity, Bastiat emphasizes that government interference with the system of free exchange, no matter how well intentioned, has perverse effects. To fully understand this, we must look beyond the immediate effects to the secondary, “unseen” consequences. Only if we do so can we be sure that government policy is not “legal plunder,” benefiting the few at the expense of the many.
Bastiat was neither the first nor the last political economist to recommend a free society. Others from Adam Smith to F. A. Hayek have done so. Nor was he the most influential: while he influenced important American and English economists in the nineteenth century, including Amasa Walker and William Stanley Jevons, he has been largely ignored since then. However, he has few peers when it comes to presenting the case for liberty with clarity and wit. Who can not see the folly of the proposal for the negative railroad or of the petition of the candle makers? And who can forget the formulation of “the seen and the unseen”? These and other literary gems constitute Bastiat’s genius, making his works a treasure trove that can still instruct and delight readers who happen across them today.
Bibliography of Secondary Works
Hébert, Robert F. “Claude Frédéric Bastiat,” New Palgrave Dictionary: A Dictionary of Economics, I. London: Macmillan, and New York: Stockton Press, 1987.
Henderson, David R. “Frédéric Bastiat,” The Fortune Encyclopedia of Economics, ed. David R. Henderson. New York: Warner Books, 1993.
Roche, George. Free Markets, Free Men: Frederic Bastiat, 1801-1850, foreword by Dick Armey. Hillsdale, Mich.: Hillsdale College Press, and Irvington-on-Hudson, N.Y.: Foundation for Economic Education, 1993. Originally published as Frederic Bastiat: A Man Alone. New Rochelle, N.Y.: Arlington House, 1971, and Hillsdale, Mich.: Hillsdale College Press, 1977.
Russell, Dean. Frédéric Bastiat: Ideas and Influence. Irvington-on-Hudson, N.Y.: Foundation for Economic Education, 1965.
- Economic Sophisms, trans. and ed. Arthur Goddard, with introduction by Henry Hazlitt (Irvington-on-Hudson, N.Y.: Foundation for Economic Education, 1996 ). Online edition: www.econlib.org/library/Bastiat/basSoph.html.
- The Law, http://fee-misc.s3.amazonaws.com/files/doclib/20121116_TheLaw.pdf
- Economic Harmonies, trans. W. Hayden Boyers, ed. George B. de Huszar, with introduction by Dean Russell (Irvington-on-Hudson, N.Y.: Foundation for Economic Education, 1996 ). Online edition: www.econlib.org/library/Bastiat/basHar.html.
- Cobden et la Ligue, ou, L’agitation anglaise pour la liberté du commerce (Paris: Guillaumin, 1845).
- Capital et rente (Paris: H. Bellaire, 1873?).
- Selected Essays on Political Economy, trans. Seymour Cain, ed. George B. de Huszar, with introduction by F.A. Hayek (Irvington-on-Hudson, N.Y.: Foundation for Economic Education, 1995 ). Online edition: www.econlib.org/library/Bastiat/basEss.html.