and date of first publication: JDE 11 (July 1845): 345–56.
First French edition as book or pamphlet: Economic Sophisms (First Series) (1846).
Location in Paillottet’s edition of OC: Vol. 4. Sophismes économiques. Petits pamphlets I, pp. 27–45.
Previous translations: 1st English ed., 1846; 1st American ed., 1848; FEE ed., 1964
It is said … but, so that I am not accused of putting sophisms into the mouths of protectionists, I will let one of their most vigorous athletes speak for himself.
It has been thought that protection in our country ought to be simply a representation of the difference that exists between the cost price of a commodity that we produce and the cost price of a similar commodity produced by our neighbors.… A protective duty calculated on these bases ensures nothing more than free competition. Free competition exists only where conditions and charges are equal. In a horse race, the weight that each runner has to bear is weighed and the conditions are equalized; without this, they are no longer competitors. In matters of trade, if one of the sellers is able to deliver at lower cost, he ceases to be a competitor and becomes a monopolist. If you abolish this protection that represents the difference in cost, as soon as foreigners invade your market, they have acquired a monopoly in it.1
Each person has to want, for himself as for the others, the production of the country to be protected against foreign competition, wherever this can supply products at a lower price.2
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This argument recurs constantly in articles written by the protectionist school. I propose to examine it carefully, that is to say, I will be asking for the attention and even the patience of the reader. I will first deal with the inequalities that result from nature and then those that result from the differences in taxation.
Here, as elsewhere, we find the theoreticians of protection situated in the producers’ camp, whereas we are taking up the cause of these unfortunate consumers whom they refuse to take into account. They compare the field of industry to the race track.3 However, the race track is simultaneously the means and the end. The public takes no interest in the competition outside the competition itself. When you start your horses with the sole aim of knowing which is the best runner, I can understand that you make the weights equal. But if your aim is to ensure that a major and urgent item of news reaches the post, could you with impunity create obstacles for the one that might offer you the best conditions of speed? This is, however, what you are doing to economic production. You are forgetting the result sought, which is well-being. You leave this out of the account, and even sacrifice it through completely begging the question.
But since we cannot bring our opponents around to our point of view, let us adopt theirs and examine the question from the point of view of production.
I will seek to establish:
1. That leveling the conditions of production is to attack the very basis of trade;
2. That it is not true that production in one country is stifled by competition from more favored countries;
3. That even if this were true, protectionist duties do not make production conditions equal;
4. That freedom levels these conditions as far as they can be leveled;
5. Lastly, that it is the countries that are least favored that gain the most from trade.
I. Leveling the conditions of production is not merely hampering a few transactions; it is attacking the very principle of trade, since it is based precisely
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on this diversity, or, if you prefer, on these inequalities of fertility, aptitude, climate, or temperature that you wish to wipe out. If the Guyenne sends wine to Brittany and Brittany wheat to the Guyenne, it is because these two provinces are situated in different conditions of production.4 Is there a different law for international trade? Once again, to hold against them the inequality of conditions that motivates and accounts for their actions is to attack their very raison d’être. If the protectionists had enough logic and power on their side, they would reduce men, like snails, to total isolation. Besides, there is not one of their sophisms that, when subjected to the test of rigorous deduction, does not end in destruction and annihilation.
II. It is not true in fact that the inequality in conditions between two similar productive enterprises necessarily leads to the fall of the one that is the less well endowed. At the race track, if one runner wins the prize, the other loses it, but when two horses work to produce useful commodities, each produces to the extent of its strength, and because the stronger provides the more services, it does not follow that the weaker provides none at all. Wheat is grown in all the départements of France, although there are huge differences of fertility between them and if, by chance, there is one that does not grow wheat, it is because it is not good, even for that département, to grow it. In the same way, a similar argument tells us that, under the regime of freedom, in spite of differences like these, wheat would be produced in all the kingdoms of Europe, and if there were one which had decided to abandon this crop it would be because, in its own interest, it had found a better use for its land, capital, and labor. And why does the fertility of a département not paralyze farmers in neighboring départements that are less favored? Because economic phenomena have a flexibility, elasticity, and, so to speak, a capacity for leveling that appears to escape the grasp of the protectionist school totally. The latter accuses us of being prisoners of a system, but it is its own members who are rigid to the highest degree, if the spirit of such consists in building arguments based on a single fact rather than on a set of facts. In the example above, it is the difference in the value of the land that compensates for the difference in its fertility. Your field produces three times as much as mine. Yes, but it has cost you ten times more and I can still compete with you. This is the question in a nutshell. And note that superiority in some
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respects brings about inferiority in others. It is precisely because your land is more fruitful that it is more expensive, in such a way that it is not accidental, but necessary for a balance to be established or to tend to become established. And can it be denied that freedom is the regime that favors this trend the most?
I have quoted one branch of agriculture, but I could have quoted a branch of manufacturing just as well. There are tailors in Quimper,5 and that does not prevent there being tailors in Paris, even though rent, furnishings, workers, and food cost Paris tailors much more. But they also have a very different class of customers, and this is enough not only to restore the balance but also even to tilt it in their favor.
So when we talk about balancing the conditions of work, we have at least to examine whether freedom does not do what we are asking arbitrary rule to do.
This natural leveling out of economic phenomena is so important functionally and at the same time so worthy of our admiration for the providential wisdom that presides in the egalitarian governance of our society, that I ask your permission to dwell on it for a moment.
You protectionists say that such and such a people have the advantage of cheap coal, iron, machines, and capital over us; we cannot compete with them.
This statement will be examined from other points of view. For the present I am limiting myself to the question whether, when superiority and inferiority confront one another, they do not carry within themselves, in the latter case, a natural tendency to rise and in the former to descend, such as to bring them back to a fair balance.
