Frederic Bastiat
Frederic Bastiat was an economist and philosopher who lived and worked in France during the French Revolution. He advocated for a Free market economy, the end of protectionist policies such as tariffs, and the socialization of various industries, including education and healthcare.
What is Plunder?
Throughout his writings, Frederic Bastiat argues against the “Plundering of the masses” by the government. The idea behind this concept is that societies legitimize and legalize what would otherwise be illegal for an individual to do, i.e. steal from one person and give that money to someone else. In his opinion, the point of government is to protect the individual rights of life, liberty, and property that Enlightenment thinkers of the time believed we are granted at birth. Thus, if the government infringes upon these individual rights by increasing its authority via taxation, tariffs, or mandatory public education it has strayed from its original intent and is a corrupted institution.
Individual Accountability
One thing that stood out amongst the writings of Frederic Bastiat is the emphasis he puts on the individual's actions. In his opinion, people are quick to blame the government for their issues and shortcomings rather than putting in the effort to work on themselves and improve. This is rooted in the fundamental nature of humanity that we do not want to have to work and would rather just enjoy the fruits of someone else’s labor. While on an individual basis, this is perceived as wholly unacceptable, the government serves as a means by which people can attempt to accomplish this. According to Bastiat, this will always result in one group of people (the people not in power) feeling aggrieved and oppressed as they are laden with an excessive tax burden, while they view the others who are profiting from government subsidies (paid for by them) with great discontent. In this scenario, both groups of people can blame the government for their lack of success. The group receiving the subsidies will never feel that it is enough and always ask for more- blaming their lack of forward progress on the lack of funds that they are receiving. The second group claims that their lack of success is also due to the government, this time due to the unfair financial burden that it places upon them. In both instances, individual accountability is removed from the picture which is truly needed for an individual to improve their situation in society whether it be financially, socially, or educationally.
Tariffs
Bastiat is vehemently against using tariffs to protect domestic industries. However, tariffs have been in the news recently as they have become a popular means of achieving three policy ambitions.
- Theoretically, it reduces the competition of domestic industries, retaining jobs at home.
- Strategically, it can be used to punish countries who are financially dependent on exporting to your country and coerce them into bending to your will.
- Fiscally, it can be used to raise funds and potentially offset income taxes.
Unfortunately, the way tariffs work there is no way to pass them without passing on that cost to the consumer. Thus, they act as a sort of consumption tax still taxing the citizens of the country, just via a different avenue. Additionally, just like other forms of welfare, tariffs foster dependency. A great example of this is the automotive manufacturers in America. Protectionist policies have led to them not having to worry as much about foreign entries to the US car market for several years. This meant that they did not feel the true pressure of the competition and thus did not innovate as quickly. The result was that foreign manufacturers developed means to manufacture vehicles that were comparable in quality or better to the American-made ones manufactured at a price that let them be competitive on the US market even with the tariffs. When the tariffs get lifted or lowered in the US, manufacturers are screwed, as they now have a more expensive product of inferior quality.
Education
One interesting thing that Bastiat mentions is that education should not be socialized. While I think this idea has potential, I do think that the government would have to set some standards if education were to occur purely in the private sector. Bastiat argues that the poor should focus on becoming fiscally stable before seeking education, and I do see his point. However, I think the only way that Bastiat’s ideal government would have a chance at working would be in a democratic society with a highly educated electorate. Thus, it might be in his best interest to include education and financial stability together in one step. It would have to be a democratic government because, in an autocratic state, power is concentrated in the hands of a few people with selfish motives. This is always going to lead to governmental overreach. Furthermore, the electorate must be educated as this can help defend against populist candidates who promise subsidies. Ideally, education means learning economically useful skills and through this education, individuals can achieve a higher degree of financial stability. Thus, with the caveat that education must consist of employable skills, in my opinion, education is an excellent means by which the poor can elevate their status. Whether it is administered by the state, or a private entity is less important to the person than the hourly rate they can make with the skills that they learn.