The consumer finally bears all the charges, just as he receives all the advantages of production.

Frédéric Bastiat
Part 5 of 7

The reasoning that follows consists in showing how protectionism works. It is the opportunity for Frédéric Bastiat to set out a few phenomenons deriving from catallactics (the study of exchanges). Today’s quote is specific to export bounties but, as he is reminding us, it is true of all taxes.

It is still common nowadays to hear politicians advocating the implementation of such or such tax with a more or less open objective to make “the rich” pay (either the productive companies or their shareholders). On the short term, it may be possible to have the burden of a tax borne by a targeted slice of the population (although it is usually much less effective than initially announced), but do not fool yourself. Over the long term, the consumer pays all the production costs of what he buys, including taxes (and other “producers’ charges” despite their name).

Other quotes from Baccalaureate and Socialism:
Part 1 of 7 – Part 2 of 7 – Part 3 of 7 – Part 4 of 7 – Part 5 of 7 – Part 6 of 7 – Part 7 of 7

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