Dakota Beacon

I have a confession, I am really sick and tired of everyone trashing a good man by the name of Frederic Bastiat.

Since I was stormed in last week; thought I would catch up on some reading and one of my favorites is “The Law” by Frederic Bastiat.

Frederic Bastiat, was a French economist who lived from 1801-1850.

Joseph Schumpeter referred to “Bastiat as the most brilliant economic journalist who ever lived”.

Dick Armey says of Bastiat, “He produced in his short 49 years some of the most brilliant writings for the cause of liberty ever written.”

Bastiat was an advocate of classical economics and the economics of Adam Smith, he favored a free market and influenced the Austrian School.  (At the bottom of the article I have included Bastiat’s Broke Window Parable)

He argues we must protect all the rights of an individual, including private property and we ought not plunder other people’s property.

Bastiat said, "Each of us has a natural right – from God – to defend his person, his liberty, and his property." 

He is saying, that when legislators pass laws that infringe on our personal property and liberty, it violates the rights of the individual.  When they punish someone by passing a law against someone to defend themselves against the collective effort of others, it is plundering.

He also argues that government has no power beyond the rights an individual would have.

Bastiat states, “Socialism, like the ancient ideas from which it springs, confuses the distinction between government and society. As a result of this, every time we object to a thing being done by government, the socialists conclude that we object to its being done at all. We disapprove of state education. Then the socialists say that we are opposed to any education. We object to a state religion. Then the socialists say that we want no religion at all. We object to a state-enforced equality. Then they say that we are against equality. And so on, and so on. It is as if the socialists were to accuse us of not wanting persons to eat because we do not want the state to raise grain”.

He goes on to describe the rights that those individuals do have, he summarizes these as life, liberty, and private property, explaining that government's only legitimate role is to protect them. (quote from Wikipedia)

He also goes on to say, “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”.

Bastiat has gotten a bad rap from many people because a few legislators banded together to review laws prior to being passed to see if they passed the smell test of government overreach.

I suspect most of these legislators understood the premise of Bastiat’s writings and with good intentions worked to put some constraints on a government which is out of control.

If this was indeed their intentions, then the only negative thing I have to say is there weren’t enough of them.

Dick Armey’s analysis of the broken window, Unintended consequences… from “Leader” by Dick Armey page 71

Bastiat’s “rule” that the economist must see both, “what is seen and what is not seen”.

“To demonstrate the difference between good citizenship and governance – and to illustrate Bastiat’s rule that in order to fully understand economics or government you must see both what is seen and unseen – let’s imagine a scenario.  Suppose you are driving down the road and you approach a point where someone is trying to exit a parking lot but is stalled due to no break in the traffic.  Without looking in your rearview mirror, you decide to stop and let that person enter the road.  Now you think it is solely a voluntary transaction from which you have both benefited.  You both gain from the transaction.  

You feel good about being a good citizen, and the other person is the beneficiary of your time-saving gift.  Since you are both gainers, as a community of two you are both made better off.  You think that you have just been a party to a free and voluntary private transaction in which everyone benefits.  What’s not to appreciate in that?  Now you follow Bastiat’s admonition, and you look in the rearview mirror to see what has not been seen.  You see that there are three cars stopped behind you.  That changes everything.  Theirs was not a voluntary transaction.  You used your leadership position to compel them to stop.  

You are not a good citizen.  You are a de facto governor.  You forced them to stop and taxed them of their time.  Furthermore, you are an income redistributor.  You took their time and gave it to the person entering the roadway.  It doesn’t take a degree in math to see that the gain to the gainers, you and the person entering the road, is less than the loss to the losers, the three people behind you.  So, you have decreased the communal well-being of the five of you.

Bastiat's original parable of the broken window from "Ce qu'on voit et ce qu'on ne voit pas" (1850):

Have you ever witnessed the anger of the good shopkeeper, James Goodfellow, when his careless son has happened to break a pane of glass? If you have been present at such a scene, you will most assuredly bear witness to the fact that every one of the spectators, were there even thirty of them, by common consent apparently, offered the unfortunate owner this invariable consolation – "It is an ill wind that blows nobody good. Everybody must live, and what would become of the glaziers if panes of glass were never broken?"

Now, this form of condolence contains an entire theory, which it will be well to show up in this simple case, seeing that it is precisely the same as that which, unhappily, regulates the greater part of our economical institutions.

Suppose it cost six francs to repair the damage, and you say that the accident brings six francs to the glazier's trade – that it encourages that trade to the amount of six francs – I grant it; I have not a word to say against it; you reason justly. The glazier comes, performs his task, receives his six francs, rubs his hands, and, in his heart, blesses the careless child. All this is that which is seen.

But if, on the other hand, you come to the conclusion, as is too often the case, that it is a good thing to break windows, that it causes money to circulate, and that the encouragement of industry in general will be the result of it, you will oblige me to call out, "Stop there! Your theory is confined to that which is seen; it takes no account of that which is not seen."

It is not seen that as our shopkeeper has spent six francs upon one thing, he cannot spend them upon another. It is not seen that if he had not had a window to replace, he would, perhaps, have replaced his old shoes, or added another book to his library. In short, he would have employed his six francs in some way, which this accident has prevented.