It is the law that causes people to dig up vines on the hill slopes and plant them in the flat fields to avoid the vexations of indirect taxation.

Frédéric Bastiat
Part 1

I shall split the speech on the tax on wines and spirits which is two dozens pages long in three parts in order to extract three quotes from it. The fist part explores a certain number of issues linked to the tax on wines and spirits, one of them being highlighted by today’s quote. For those of you who are not into wine, please let me emphasise that today’s quote highlights a double absurdity because the best wines come from the vines planted on the slopes, on soils that are also not very well suited for other crops (like wheat for instance) which grows much better on flat fields.

This quote appears important to me because it highlights the fact that legislation has effects that are not necessarily those which are aimed at. The legislator votes legislation in order to obtain certain results (increase revenues to the Treasury in the present case) but often forgets that adopting such legislation creates incentives that were not part of the objectives (to avoid paying a tax on wine consumption by the farmers themselves in the present case), which leads to situations that are far away from what the legislator attempted to do (use wheat fields to produce bad wine, thus reducing the production of existing vines and better quality wine in the present case).

When the side effects of legislation are greater than its benefit, it ought to be abrogated. In order to do that, it would be preferable to identify the wrongs thus created, which is unfortunately not in the interest of the legislator who is usually short-sighted (if not individually, at least collectively through parliament that adopts legislation).

Other quotes from the Speech on the Tax on Wines and Spirits:
Part 1 – Part 2 – Part 3

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